DEF 14A 1 d284456ddef14a.htm DEF 14A DEF 14A
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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

SCHEDULE 14A

Proxy Statement Pursuant to Section 14(a) of the Securities

Exchange Act of 1934

 

Filed by the Registrant     ☑    Filed by a Party other than the Registrant    ☐
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Confidential, For Use of the Commission Only (as permitted by Rule 14a-6(e)(2))
☑ Definitive Proxy Statement   
☐ Definitive Additional Materials   
☐ Soliciting Material Pursuant to § 240.14a-12

Invesco Ltd.

 

(Name of Registrant as Specified in Its Charter)

 

 

(Name of Person(s) Filing Proxy Statement, if Other Than Registrant)

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Table of Contents

    

LOGO

 

 

Proxy

Statement

 

 

Notice of 2021 Annual General Meeting of Shareholders

 

 

 

 

LOGO     

Your vote is important:

Please vote by using the Internet, the telephone or by signing, dating and returning a proxy card

 


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Invesco

A leading independent global investment management firm

 

Founded in     Proudly manages     Over     Serving clients in     On the ground in
1935          $1.35T          8,000          120+          20+
and headquartered     in assets for retail     employees to better     countries     countries to leverage
in Atlanta, Georgia     and institutional     serve all clients         local presence
    investors1            

Our single focus is to help clients achieve their investment objectives

 

  We direct all of our intellectual capital, global strength and operational stability toward helping our clients
  We have a broad and deep presence in key markets across the globe
  We have a strong track record of financial stability and possess the resources to continue our long-term investment in the business

Our purpose

Delivering an investment experience that helps people get more out of life

 

     

 

LOGO

 

 

Our multi-year strategic objectives

 

•  Achieve strong investment performance

 

•  Be instrumental to our clients’ success

 

•  Harness the power of our global platform

 

•  Perpetuate a high-performance organization

 
     

 

LOGO

 

 

Our beliefs put clients at the center of everything we do

 

•  Pure focus on investing

 

•  Passion to exceed

 

•  Diversity of thought and a collaborative culture

 

•  A comprehensive range of capabilities enables us to meet the unique needs of clients

 

•  A high-conviction approach is more impactful

 

•  Patience leads to better results over time

 
     

 

LOGO

 

 

Our beliefs enable us to

•  Inspire the consistent behaviors and discipline that help generate strong, long-term investment performance for our clients

•  Maintain an engaging work environment that helps us attract, develop, motivate and retain the best talent in the industry

 
     

1 December 31, 2020

 


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LOGO

G. Richard Wagoner, Jr.

has served as Chair of our

Board since 2019 and as a

non-executive director of

our company since 2013

A letter to our shareholders from the

Chairperson of Our Board

Dear Fellow Shareholder,

The Invesco Ltd. Board of Directors fully appreciates that you have entrusted us as stewards of your investment in the firm and takes very seriously our duties and responsibilities in that regard.

In that spirt, I thought it appropriate to share with you several of the most important areas in which the Board focused its attention in 2020.

Managing through the COVID-19 global pandemic. As was the case for companies around the globe, the coronavirus crisis represented a tremendous challenge for Invesco throughout 2020. Invesco’s primary focus throughout the pandemic has been on ensuring the health and safety of our people, and managing client assets and serving as a valued partner to them, while protecting the financial position of the firm.

The Board closely monitored Invesco’s prompt, decisive and effective reaction to this difficult situation. The firm stepped up its digital efforts to engage with clients safely while rotating nearly all of its employees to work-from-home status. Invesco reshaped its client delivery model to a fully digital engagement platform, allowing frequent connection with clients to help deliver the outcomes they were seeking.

Monitoring the firm’s financial strength. Like many companies managing through the initial phases of the pandemic, Invesco’s results came under pressure during the first half of the year. Given the prevailing uncertainty, the Board supported management’s decision to draw down the company’s credit lines and in April 2020 made the difficult decision to reduce the quarterly common stock dividend by 50%. These measures were taken to enhance liquidity and maintain financial flexibility in the uncertain market environment.

The Board was pleased to see Invesco take advantage of the improving market and economic conditions in the second half of 2020, leading to record assets under management of $1.35 trillion as of year end and improved financial results. As we move into 2021, the Board believes Invesco is well positioned to maintain positive momentum in 2021 and beyond.

Delivering on our commitment to ESG. Your Board recognizes that environmental, social and governance (ESG) investing matters greatly to our clients, communities and shareholders. Invesco is strongly committed to a comprehensive ESG effort across the firm, and views it as an important agent of change in driving a holistic perspective on the investment industry’s role in creating value. The firm’s recognized track record provides a strong foundation on which to build and which will support its ESG ambitions. For the last four consecutive years, Invesco achieved an A+ rating from the PRI (Principles for Responsible Investment) for its strategy and governance. The firm also continued its strong history of innovation in this important area by launching a number of ESG-related products in 2020.

Evolving our Board composition. The Board remains committed to recommending to shareholders a slate of directors which is well-equipped to oversee the company and effectively represent the interests of shareholders. This includes ensuring an appropriate balance of diversity, expertise, experience and continuity, as well as fresh perspectives.

In late 2020, the Board welcomed three new members. Nelson Peltz and Edward P. Garden joined as representatives of Trian Fund Management, in conjunction with Trian’s significant investment in Invesco. Thomas M. Finke, formerly of Barings, a subsidiary of MassMutual, which is Invesco’s largest shareholder, joined at the same time. The additions of Mr. Peltz, Mr. Garden and Mr. Finke recognize their significant domestic and international board and industry experience, and valuable perspective as major shareholders of Invesco. Their prior

 

 

2021 Proxy Statement        ii


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significant experiences in asset management give them a deep understanding of the substantial growth opportunities within this industry. We are very pleased to have them as colleagues on the Invesco Board.

In addition, as noted later in this proxy statement, the Board is pleased to nominate Paula Tolliver for election to the Board at the May Annual General Meeting. Ms. Tolliver brings in-depth experience in technology and global business operations, and we look forward to welcoming her to our Board.

I would also like to take this opportunity to express the Board’s deep appreciation to Rod Canion, who retired from the Board in December 2020 after 23 years of service. Mr. Canion provided invaluable insights and perspective to the Board throughout his years of service, leveraging his experience as co-founder and CEO of Compaq Computer Corp.

Annual General Meeting Invitation. You are cordially invited to attend the 2020 Annual General Meeting of Shareholders of Invesco Ltd., which will be held virtually on Thursday, May 13, 2021, at 1 p.m. ET.

Your vote is important, and we encourage you to vote promptly. Regardless of whether you can attend the Annual General Meeting, please follow the instructions contained in the Notice of Internet Availability of Proxy Materials (“Notice”) on how to vote via the Internet or the toll-free telephone number, or request a paper proxy card to complete, sign and return by mail so that your shares may be voted.

Your Board’s conviction regarding Invesco’s opportunity within the asset management business remains as strong as ever, as does our confidence in the Invesco team. On behalf of the Board of Directors, I extend our appreciation for your continued support.

Yours sincerely,

 

LOGO

G. Richard Wagoner, Jr

Chairperson

 

 

   iii        Invesco Ltd.


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LOGO

Martin Flanagan

has been President and

Chief Executive Officer of

our company and a director

since 2005

A letter to our shareholders from our

President and CEO

Dear Fellow Shareholder,

Thank you, as always, for your continued support as a shareholder in our firm. I’d also like to express our deep appreciation to our clients and employees for their continued support in these extraordinary times. Our Board of Directors, leadership and more than 8,000 employees are dedicated to helping clients across the globe meet their investment objectives while generating value for our shareholders.

The past year provided many new challenges for the industry as COVID-19 swept across the globe, changing the way we interact with our families, our colleagues and our clients. Throughout 2020, we focused on executing our long-term strategy while supporting our employees and clients, finding new ways of working and achieving our purpose of helping people get more out of life.

The real story of 2020 for Invesco is how we came together as an organization under the most challenging circumstances to ensure the safety and well-being of our employees and help clients meet their investment objectives while advancing the organization’s ability to meet key client demand trends that will drive our success going forward.

A look back at 2020: Further positioning Invesco for future success

Despite the challenges we encountered, we made significant advances in a number of key areas in 2020. Specifically, we:

  Prioritized the health and safety of our employees as we transitioned 99% of our firm to a productive work-from-home environment while remaining highly focused on our clients and our business;
  Maintained strong investment performance across our global business in areas of high demand and worked to address other capabilities where we saw under-performance;
  Materially advanced our digital engagement with clients, which further improved our ability to meet their desired outcomes;
  Undertook a comprehensive strategic evaluation of our business to further enhance client outcomes, improve our ability to drive organic growth, reduce complexity and streamline our operating environment. Through this evaluation, we are investing in key areas of growth, including ETFs, Fixed Income, China, Solutions, Alternatives and Global Equities, while identifying and executing permanent improvements in our expense base that will ultimately result in net cost savings of $200 million; and
  Led a public call to action on social injustice by leaders and employees, and stepped up our Diversity and Inclusion efforts.

Combined, this work of further building our business allowed us to weather challenges in the first half of the year while supporting the strengthening of our operating results in the second half of 20201:

  We achieved strong performance in several key growth areas, particularly Fixed Income and Global Equities, including Emerging Markets, and Asian Equities;
  Invesco ended the year with record assets under management of $1,349.9 billion, up from $1,226.2 billion in AUM at the end of 2019;
  Following net outflows of $33.3 billion in the first half of the year, we achieved six straight months of net long-term inflows totaling nearly $18 billion in the second half of 2020;
  Retail flows significantly improved in the second half of the year, and our solutions-enabled institutional pipeline remains near record levels;
  We saw strong net inflows in Asia Pacific totaling more than $17 billion in the second half of the year, with improving flows in EMEA and the Americas in the same timeframe;
  Global ETF AUM grew to a record $345 billion, and the firm introduced several innovations to the market, including the expansion of the QQQ suite of products, and the launch of non-transparent active funds, ESG/Sustainable strategies and others; and
  We improved balance sheet liquidity and flexibility after making the difficult decision to reduce the quarterly common stock dividend in April 2020 during the height of pandemic uncertainty.
 

 

2021 Proxy Statement        iv


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Our work over the past year further enhanced the firm’s ability to anticipate, understand and meet client needs, while strengthening our effectiveness and efficiency, and achieving greater economies of scale that will enable us to provide a higher level of value to clients and further improve our competitive position. We believe our efforts to further deepen client relationships through the pandemic, continued investment in our key growth areas and the additional operating efficiency we achieved in 2020 will meaningfully enhance our ability to grow our business, compete and win as efforts to mitigate the pandemic progress in 2021.

Building a strong foundation for 2021 and beyond

The events of the past year challenged us to re-examine long-term trends in our industry and our beliefs about the future. A few of our beliefs have evolved, but the overall direction remains the same. If anything, the pandemic has accelerated many of the macro trends impacting our business. In particular:

  Clients are seeking deeper relationships with fewer trusted managers and looking for best-in-class solutions providers;
  We’re operating in a new normal of “digital everything” that is changing the relationship among investment managers, intermediaries and end-clients;
  Although the US remains the largest asset management market, China and emerging markets will drive growth in the future; and
  Client demand for outcomes using a combination of active, passive and alternative capabilities continues to grow at a rapid pace.

Combined, the challenges and opportunities in our industry continue to widen the gap between global, increasingly scaled firms like Invesco and those that will struggle as these trends further accelerate in 2021 and beyond.

Invesco operates in a $100 trillion industry2 that we anticipate will continue to grow. We also have a clear understanding of how client demand is evolving and where it’s headed. Over the past decade, we’ve been highly focused on investing ahead of shifts in client demand, putting us in a very strong position to take advantage of key industry tailwinds in the future.

As a result, we now have a strong and highly diversified set of capabilities aligned to client demand trends, with leadership positions in key markets across the globe.

  Our ETF platform is the fourth-largest in the world, and we are a global leader in factors with a 36-year track record of innovation 3;
  We have a highly competitive private markets platform, with strong positions in real estate, bank loans and distressed credit capabilities 4;
  We provide a suite of fully scaled fixed income, global and emerging market capabilities with consistently strong performance 5;
  We have a market-leading Solutions business that brings the full power of our investment capabilities to clients; and
  Our #1 leadership position among onshore providers in China (Z-Ben Advisors 2020 China rankings of top foreign firms in China, published April 2020), the world’s fastest-growing market, builds on a 40-year legacy of success in the Asia Pacific region.

These capabilities also define key areas of focus for the firm in 2021. Market-leading capabilities with high demand and strong performance form the core of our go-to-market efforts and will help drive value creation within the business. As importantly, we’ll also continue to strengthen those areas of our business that enable growth, including our highly competitive digital efforts, investment solutions, asset allocation offerings and our ESG capabilities.

 

 

v        Invesco Ltd.


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Looking to the future

I’d like to express our deep appreciation to the Invesco Ltd. Board for their proactive engagement in the business and their continued support. Their significant expertise and experience proved invaluable through the challenges of 2020 and will help us achieve the true potential of our firm going forward.

We’re confident that we have the talent, the capabilities, the resources and the momentum to drive the firm’s future growth and success for the benefit of clients, while creating value for shareholders. We’re optimistic about the prospects for the global economy in the year ahead and look forward to taking our business forward on behalf of our valued shareholders in 2021 and beyond.

Regards,

 

LOGO

Marty Flanagan

President and CEO

 

 

 

Disclosures

1

Source: All data Invesco data as of December 31, 2020. See the firm’s most recent presentation of operating results at www.invesco.com/corporate for full disclosures related to the figures provided.

2

Source: IVZ, CS Market, Opportunity Model. Data as of December 31, 2019. Includes money market AUM.

3

Source: Invesco ETFs Strategy & Research, as of December 31, 2020.

4

Source: Invesco data. See the firm’s presentation of fourth-quarter operating results at www.invesco.com/corporate for full disclosures related to the figures provided.

5

Source: Invesco data as of December 31, 2020. Includes actively managed fixed income, money market and stable value funds.

 

 

2021 Proxy Statement        vi


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        Notice of 2021 Annual Meeting of Shareholders

 

    
                           

Date and time

 

LOGO  

Thursday, May 13, 2021,

at 1:00 p.m.,

Eastern Time

Place
LOGO  

Virtual Meeting

www.meetingcenter.

io/293405929

For details on how to

participate in the virtual

meeting, see “How

do I attend the Annual

General Meeting” on

page 85

Voting methods

 

LOGO   Internet
 

Visit the web site

listed on your Notice

 
LOGO   Telephone
 

Call the telephone

number listed on

your Notice

 
LOGO   Mail
 

Sign, date and return

a requested proxy card

 
LOGO   Virtually
  Attend the virtual
  Annual General
  Meeting
         Board voting
Items of business    recommendation
1   To elect twelve (12) directors to the Board of Directors to hold office until the annual general meeting of shareholders in 2022   

 

     LOGO

 

 

FOR    

2   To hold an advisory vote to approve the company’s executive compensation   

 

     LOGO

 

 

FOR

3   To amend and restate the Invesco Ltd. 2016 Global Equity Incentive Plan to increase the number of shares authorized under the plan   

 

     LOGO

 

 

FOR

4   To appoint PricewaterhouseCoopers LLP as the company’s independent registered public accounting firm for the year ending December 31, 2021   

 

     LOGO

 

 

FOR

5   To consider and act upon such other business as may properly come before the meeting or any adjournment thereof         

Who can vote

Only holders of record of Invesco Ltd. common shares on March 15, 2021 are entitled to notice of, to attend and vote at the virtual Annual General Meeting and any adjournment or postponement thereof. Beginning on March 26, 2021, we mailed a Notice of Internet Availability of Proxy Materials containing instructions on how to access this Proxy Statement and our Annual Report via the Internet to eligible shareholders.

During the virtual Annual General Meeting, the audited consolidated financial statements for the year ended December 31, 2020 of the company will be presented.

By order of the Board of Directors,

Kevin M. Carome

Company Secretary

March 26, 2021

 

 

vii        Invesco Ltd.


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Proxy statement

This Proxy Statement is furnished in connection with the solicitation of proxies by the Board of Directors of Invesco Ltd. (“Board” or “Board of Directors”) for the virtual Annual General Meeting to be held on Thursday, May 13, 2021, at 1:00 p.m. Eastern Time. Please review the entire Proxy Statement and the company’s 2020 Annual Report on Form 10-K before voting. In this Proxy Statement, we may refer to Invesco Ltd. as the “company,” “Invesco,” “we,” “us” or “our.”

Voting roadmap

Proposal     Election of directors

 

 

1    

 

 

 

Diversity

of our director nominees:

 

LOGO

 

 

•  11 of our 12 nominees are independent

•  We have an independent chair of the Board

•  Our independent directors meet regularly without management present

•  All of our Board committees are composed exclusively of independent directors

•  Our Board has principal responsibility for oversight of the company’s risk management process and understanding of the overall risk profile of the company

•  Directors are elected for a 1-year term

 

 

 

  

 

Qualifications, skills and experience

 

  
        LOGO   

92%

Executive

leadership

   LOGO   

92%

Strategy

and execution

   LOGO   

75%

International

experience

   LOGO   

67%

Industry

Experience

   LOGO   

33%

Accounting and

financial reporting

   LOGO   

25%

Technical -

government, legal,

regulatory, and

technology

 

                                 
 

 

LOGO

 

 

FOR

  

Recommendation of the Board of Directors

The board of directors unanimously recommends a vote “FOR” the election to the board of each of the director nominees.

 

            

                 

 

 

 

 

2021 Proxy Statement        viii


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        Proposal

  2

 

 

    

Advisory vote on the compensation

  paid to our named executive officers
 

 

Invesco’s executive compensation program is designed to align executive compensation with the long-term interests of our shareholders. Our compensation program uses a company scorecard to measure our financial performance, how we deliver to clients and our organizational strength. Our compensation committee assesses the company’s quantitative performance through the company scorecard and qualitative individual achievements to determine each executive’s incentive compensation. The pay determination process reinforces our shareholder value framework.

 

Pay for 2020 is aligned with performance, reflecting a year of challenged financial performance due to the COVID-19 pandemic, a challenging industry environment and only partially achieving our 2020 goals, offset by management’s response to COVID-19 for our employees and clients and, later in the year, the return of positive flows and improved investment performance.

 

              
2020 Financial performance (year-over-year change)1

 

                  
Adjusted     Adjusted     Adjusted     Ending  
operating income2        operating margin2        diluted EPS2        AUM               
$1.7 billion     37.0%     $1.93     $1.35T  
(+0.5%)     (-0.5 percentage     (-24%)     (+10%)  
    point)          
                  

 

 

          

LOGO

 

Martin L. Flanagan

President and CEO

 

2020 CEO Compensation

Mr. Flanagan is President and CEO. He develops, guides and oversees execution of Invesco’s long-term strategic priorities to deliver value for clients and shareholders over the long-term.

 

Mr. Flanagan’s total compensation is down 9.4% from 2019. The committee decided that Mr. Flanagan’s total incentive compensation should be $10.31 million, which is 76.4% of his 2020 incentive target.

Total CEO pay decreased     

93%

 

    

60%

 

              

9.4%

 

      

of CEO’s 2020

pay is variable

      

of CEO’s 2020 equity is

performance-based

   
from 2019      

 

Further information regarding executive compensation begins on Page 32 of this Proxy Statement.

 

                         

LOGO

 

 

FOR        

  

Recommendation of the Board of Directors

The board of directors unanimously recommends a vote “FOR” the approval of the compensation of our named executive officers.

 
            

 

 

1  Financial results for 2019 include approximately 7 months of OppenheimerFunds financial results compared to 2020, which include 12 months of OppenheimerFunds financial results.

2  Adjusted financial measures are all non-GAAP financial measures. See the information in Appendix A regarding Non-GAAP financial measures.

 

 

ix        Invesco Ltd.


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        Proposal

  3

  

 

Approval of the amended and

   restated Invesco Ltd. 2016 global
   equity incentive plan
       
   The amended and restated Invesco Ltd. 2016 Global Equity Incentive Plan will increase the number of shares authorized under the plan.
   Why we support the proposal
   The Equity Plan:
  

•  Is key to our attracting and retaining top talent

  

•  Enables us to align the long-term interests of our associates with those of our shareholders

  
  

 

  
  

LOGO

 

FOR

  

Recommendation of the Board

The board of directors unanimously recommends a vote “FOR” the approval of the equity plan.

       
  

 

       
       
       
       
       

 

        Proposal

  4

  

Ratification of the appointment of

PricewaterhouseCoopers LLP as the

company’s independent registered

public accounting firm for 2021

       
   The Audit Committee and the Board believe that the continued retention of PwC as our independent registered public accounting firm is in the best interest of the company and our stockholders.
       
       
  

 

       
  

LOGO

 

 

FOR    

  

Recommendation of the Board

The board of directors unanimously recommends a vote “FOR” the appointment of PwC as the company’s independent registered public accounting firm for the year ending December 31, 2021.

       
  

 

       

 

 

 

2021 Proxy Statement        x


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Contents

 

Proxy statement summary      1       
 
Board of Directors      6       
Nominee biographies      6       
Director independence      13       
Board meetings and annual general meeting of shareholders      13       
Committee membership and meetings      13       
The Audit Committee      13       
The Compensation Committee      14       
The Nomination and Corporate Governance Committee      14       
Director compensation      15       
 
Proposal No. 1 – Election of directors      19       
 
Corporate governance      20       
Corporate governance guidelines      20       
Code of conduct and directors’ code of conduct      20       
Board leadership structure      20       
Director recruitment      20       
Director orientation and continuing education and development      21       
Board evaluation process      21       
Shareholder engagement      22       
Board’s role in risk oversight      23       
Our risk management framework      24       
Environmental, social and governance (ESG) responsibility      25       
Commitment to inclusion and diversity      27       
 
Information about the executive officers of the company      29       
 
Executive compensation      32       
Compensation discussion and analysis      32       
Compensation committee report      60       
Summary compensation table      61       
All other compensation table      62       
Grants of plan-based share awards      63       
Outstanding share awards at year-end      64       
Shares vested      65       
Potential payments upon termination or change in control      66       
CEO pay ratio      67  
Compensation committee interlocks and insider participation      67  
Certain relationships and related transactions      68  
Related person transaction policy      71  
Security ownership of principal shareholders      71  
Security ownership of management      72  
Proposal No. 2 – Advisory vote to approve the company’s executive compensation      73  
Proposal No. 3 – Amend and restate the Invesco Ltd. 2016 Global Equity Incentive Plan to increase the number of shares authorized under the plan      74  
Proposal No. 4 – Appointment of independent registered public accounting firm      81  
Fees paid to independent registered public accounting firm      82  
Pre-approval process and policy      82  
Report of the audit committee      83  
General information regarding the annual general meeting      84  
Questions and answers about voting your common shares      84  
Important additional information      87  
Appendix A – Schedule of Non-GAAP information      90  
Appendix B – Amended and Restated Invesco Ltd.      94  
2016 Global Equity Incentive Plan      94  
 
 


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Proxy statement summary

2020 presented many challenges for Invesco, our industry and global financial markets as a result of the COVID-19 pandemic. The impact of the pandemic, investment performance challenges in some of our strategies and disappointing flows negatively impacted the company. However, our response to the pandemic for our employees and clients and, later in the year, the return to positive flows and improved investment performance allowed us to partially achieve our 2020 goals.

 

 

2020 Financial performance (year-over-year change)1

 

Adjusted      Adjusted      Adjusted      Ending
operating income2      operating margin2      diluted EPS2      AUM
$1.7 billion               37.0%               $1.93               $1.35T
(+0.5%)      (-0.5 percentage point)      (-24%)      (+10%)

 

 

 

Our firm 2020 highlights

 

    
 

 

 
 

LOGO

 

  Investment performance continued to be strong in high demand capabilities, including Fixed Income, Global Equities, including Emerging Markets Equities, and Asian Equities.  
 

 

 
  LOGO   Following long-term net outflows of $33.3 billion in the first half of the year, we achieved six straight months of long-term net inflows totaling nearly $18 billion in the second half of 2020, including progress made across channels, geographies and asset classes and ended the year with record assets under management of $1,350 billion.  
             The long-term net inflows in our retail channel significantly improved in the second half of the year and our solutions-enabled institutional pipeline remains near record level.  
   

In Asia Pacific, we saw net inflows of over $17 billion in the second half of 2020, our net flows in the Americas and EMEA are improving, and we saw robust long-term net inflows into our fixed income capabilities.

 

          
 

 

 
  LOGO   We took action during the year to improve our financial position and flexibility. Following the dividend reduction in April, we made progress in improving our balance sheet cash position and reduce our credit facility balance to zero at the end of the year.  
    We embarked upon a strategic evaluation of the business, focusing on four key areas:  
    Our organizational model    Our real estate footprint  
   

Management of third-party spend

 

  

Technology and operations efficiency

 

 
 

 

 
             
  1

Financial results for 2019 include approximately 7 months of OppenheimerFunds financial results compared to 2020, which include 12 months of OppenheimerFunds financial results.

 
  2

Adjusted financial measures are all non-GAAP financial measures. See the information in Appendix A regarding Non-GAAP financial measures.

 

 

 

 

 

2021 Proxy Statement        1


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Looking forward

We expect the strategic evaluation discussed above will reduce our annual operating expenses by a net $200 million by the end of 2022, providing us with opportunities to continue to invest in key growth areas:

 

ETFs    Alternatives    Solutions
China    Fixed income    Global equities

With the investments we have made into our key capabilities over the last decade and our most recent efforts to better align the organization with our strategy, we believe that we have the talent, capabilities, resources and momentum to drive our future growth and success.

 

 

 

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Governance highlights

 

Board refreshment

    Added 3 new directors to the Board in 2020 and one new nominee for 2021.
    Increased Board diversity over the past 5 years.
    Directors may not stand for election after age 75 unless the Board determines there is a good reason to make an exception to this policy.

Independence

    10 of our 11 current directors and 11 of our 12 director nominees are independent.
    Our chief executive officer is the only management director.
    All of our Board committees are composed exclusively of independent directors.

Independent Chair

    We have an independent Chair of our Board of Directors, selected by the independent directors.
    The Chair serves as liaison between management and the other independent directors.

Board oversight of risk management

    Our Board has principal responsibility for oversight of the company’s risk management process and understanding of the overall risk profile of the company.

 

 

 

Accountability

  Directors are elected for a one-year term.  
  A meeting of shareholders may be called by shareholders representing at least 10% of our outstanding shares.  

Board practices

  Our Board annually reviews its effectiveness as a group with a questionnaire and confidential and private one-on-one interviews coordinated by an independent external advisor that reports results of the annual review in person to the Board.  
  Nomination criteria are adjusted as needed to ensure that our Board as a whole continues to reflect the appropriate mix of skills and experience.  

Executive sessions

  The independent directors regularly meet in private without management.  
  The Chair presides at these executive sessions.  

Share ownership requirements

  We require directors and executives to maintain an ownership level of our stock.  
 
 

 

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Our Directors and their qualifications

    Director nominees are highly qualified and have the significant leadership and professional experience, knowledge and skills necessary to provide effective oversight and guidance for Invesco’s global strategy and operations.  
    Director nominees represent diverse views, experiences and backgrounds.  
    Director nominees possess the characteristics that are essential for the proper functioning of our Board.  
    Tenure of the members of our Board of Directors provides the appropriate balance of expertise, experience, continuity and perspective to our board to serve the best interests of our shareholders.  
    As the Board considers new director nominees, it takes into account a number of factors, including nominees that have skills that will match the needs of the company’s long-term global strategy and will bring diversity of thought, global perspective, experience and background to our Board.  
    While the Board has no formal policy regarding diversity, as the Board reviews its needs for additional directors, the Board routinely considers gender, ethnic and other diversity factors.  
    For more information on our director nomination process, see Information about Director  

      Nominees — Director Recruitment.

 

   

 

Director nominees highlights

 

 

    

 

 

Average tenure            

6

years

 

 

Director nominees composition

 

LOGO

   

                    

 

 

Average age

65

years

 

 

        

 

Director nominees tenure                                 Director nominees

                                                                            independence

 

                      
   

LOGO

 

 

 

 

    

 

 

 

 

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Our Board considers new ideas and perspectives important components of a well-functioning board. We consider candidates with diverse capabilities, including one or more of those listed below.

 

 

 

       

 

 

Executive leadership

 

   92%         International experience    75%
     LOGO  

Directors with senior leadership and executive management backgrounds bring valuable practical experience to our Board, providing insights into challenging issues while remaining focused on our strategic initiatives

 

             LOGO    We invest and provide products globally, making international experience an important perspective to our Board   
 

 

       

 

 

Industry experience

 

   67%     

 

     LOGO

   Strategy and execution    92%
     LOGO  

A key to our success is our ability to provide asset management excellence and directors with backgrounds in the financial services industry and capital markets help provide oversight of our strategy

 

                

Directors with experience developing and executing a strategic direction for an entity assist the Board in providing oversight of the Company’s strategy in a rapidly evolving business environment

 

  
 

 

       

 

 

Accounting and financial reporting

 

   33%     

 

     LOGO   

  

Technical - government, legal, regulatory and technology

 

   25%
     LOGO      We are subject to complex financial reporting obligations and we benefit from having directors with strong accounting and financial reporting experience         Substantive government, legal, regulatory and technology experience on our Board offers us valuable insights into the environment in which we operate and the implications to our business   

 

    

 

 

 

 

2021 Proxy Statement        5


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Board of Directors

 

 

Nominee biographies

 

LOGO

 

Sarah E. Beshar

Non-executive director

 

Age                    Tenure

62                        4 Years

 

Committees:

•  Audit

•  Compensation

•  Nomination and Corporate Governance (Chair)

 

Qualifications:

•  Industry expertise

•  International experience

•  Technical - government, legal, regulatory and technology

  

Sarah E. Beshar

Sarah Beshar has served as a non-executive director of our company since 2017 and has been an attorney with Davis Polk & Wardwell LLP for over 30 years. She joined the firm in 1986 and was named a partner in the Corporate Department in 1994. During more than three decades as a corporate lawyer, Ms. Beshar has advised Fortune 500 companies on an array of legal and governance issues. She also served in a number of management roles at the firm, including as the lead partner of one of the firm’s largest financial services clients from 2008 to 2015. She presently serves as Senior Counsel at the firm.

 

Ms. Beshar is a member of the corporate board of Lincoln Center, a conservation fellow of the Whitney Museum and a trustee of the Episcopal Charities (New York). In 2018, she was appointed a Director of the Board of the U.S. Asia Center, Australia’s preeminent foreign policy and trade think tank and in 2020, she was appointed a director of the American Australian Association, a privately funded organization dedicated to cooperation between the U.S. and Australia. Ms. Beshar graduated from the University of Western Australia with a B.A. in Law and Jurisprudence in 1981. Ms. Beshar also graduated from Oxford University in 1984 with a Bachelor of Civil Law degree from Magdalen College. She was awarded an Honorary Doctorate in Law from the University of Western Australia in 2015.

 

Director qualifications

•  Relevant global industry experience: As a member of her firm’s capital markets practice, as an advisor to some of the largest global companies, and with significant experience in the development of new financial products, Ms. Beshar has broad exposure and experience to the issues in our industry.

•  Legal and regulatory expertise: Ms. Beshar has over three decades of experience as a corporate lawyer and strategic advisor on the legal issues facing large financial services companies such as Invesco. Ms. Beshar has significant experience in U.S. and global capital markets transactions, as well as securities, compliance, and corporate governance issues. In addition, Ms. Beshar led large teams at Davis Polk advising global financial institutions on complex investment products for both retail and institutional investors. The breadth of Ms. Beshar’s background is particularly helpful to the Board of Directors of Invesco as it assesses the legal and strategic ramifications of key business priorities and initiatives.

 

LOGO

 

Thomas M. Finke

Non-executive director

 

Age                    Tenure

57                       <1 Year

 

Committees:

•  Audit

•  Compensation

•  Nomination and Corporate Governance

 

Qualifications:

•  Executive leadership

•  Industry expertise

•  International experience

•  Strategy and execution

  

Thomas M. Finke

Mr. Finke has served as a non-executive director of our company since December 2020. Mr. Finke served as Chairman and Chief Executive Officer of Barings from 2016 through November 2020 when he retired. He joined Barings predecessor Babson Capital Management in June 2002 when Babson acquired First Union Institutional Debt Management. Mr. Finke was appointed Chairman and CEO of Babson Capital in December of 2008, and also served as EVP and CIO of Massachusetts Mutual Life Insurance Company from December 2008 until May 2011. He earned a Master of Business Administration degree from Duke University’s School of Business and a bachelor’s degree from the University of Virginia’s McIntire School of Commerce.

 

Director qualifications

•  Executive leadership: Mr. Finke ‘s service as Chairman and CEO of Barings, an international investment management firm with over $300 billion of assets under management, and his other executive positions throughout his career provide Mr. Finke with an astute understanding of the skills needed for exemplary leadership and management that will benefit our Board.

•  Industry experience: Mr. Finke’s 34-year financial career has included roles in both the banking and investment management industries providing him with an extensive knowledge of the investment management industry.

 

 

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LOGO

Martin L. Flanagan

President and CEO

Age             Tenure

60                 16 Years

Qualifications:

  Executive leadership
  Industry experience
  International experience
  Accounting and financial reporting
  Strategy and execution

 

LOGO

Edward P. Garden

Non-executive director

Age             Tenure

59                 <1 Year

Committees:

  Compensation
  Nomination and Corporate
Governance

Qualifications:

  Executive leadership
  Industry expertise
  Strategy and execution
  Accounting and financial reporting

Martin L. Flanagan

Martin Flanagan has been a director and President and Chief Executive Officer of Invesco since 2005. He is also a trustee and vice-Chair of the Invesco Funds (the company’s U.S. open- and closed-end funds). Mr. Flanagan joined Invesco from Franklin Resources, Inc., where he was president and co-chief executive officer from 2004 to 2005. Previously, he held numerous positions of increasing responsibility at Franklin — co-president, chief operating officer, chief financial officer and senior vice president – from 1993 to 2003. Mr. Flanagan served as director, executive vice president and chief operating officer of Templeton, Galbraith & Hansberger, Ltd., before its acquisition by Franklin in 1992. Before joining Templeton in 1983, he worked with Arthur Andersen & Co. He serves as Trustee of Southern Methodist University (SMU) and as a member of the executive board at the SMU Cox School of Business. He serves as Chair of Engage Ventures, an innovation platform bringing together Atlanta-based corporations to support startups. He sits on the Executive Council for the Metro Atlanta Chamber and served as 2020 MAC Chair. He is a member of the Executive Committee for the Investment Company Institute, and formerly served as Chair and on the Board of Governors for ICI. He serves as a Board member of the Atlanta Committee for Progress and is a former ACP Chair. Mr. Flanagan is a CFA charterholder and a certified public accountant. He earned a B.A. and B.B.A. from Southern Methodist University (SMU).

Director qualifications

  Executive leadership, relevant industry experience: Mr. Flanagan has spent over 30 years in the investment management industry, including roles as an investment professional and a series of executive management positions in business integration, strategic planning, technology and investment operations, and finance. Through his decades of leadership and involvement, including as former Chair of our industry’s principal trade association, the Investment Company Institute, he has amassed a broad understanding of the larger context of investment management.
  Accounting and financial reporting expertise: Mr. Flanagan obtained extensive financial accounting experience with a major international accounting firm and served as chief financial officer of Franklin Resources. He is a chartered financial analyst and certified public accountant.

Edward P. Garden

Ed Garden has served as a non-executive director of our company since November 2020 and has been Chief Investment Officer and a Founding Partner of Trian Fund Management, L.P. since its inception in 2005. Previously, Mr. Garden served as Vice Chairman and a director of Triarc Companies, Inc., where he was also head of corporate development. Prior to joining Triarc, Mr. Garden was a Managing Director of Credit Suisse First Boston, where he served as a senior investment banker and BT Alex Brown, where he was co-head of Equity Capital Markets. Mr. Garden received a B.A. from Harvard College.

Director qualifications

  Executive leadership, Industry experience: Mr. Garden has over 25 years of experience in advising, financing, operating and investing in companies, including several in the asset management industry. Mr. Garden has worked with management teams and boards to implement growth initiatives as well as operational, strategic and corporate governance improvements. Mr. Garden brings a network of relationships with institutional investors and investment banking/capital markets experience to the Board. In October 2014, Mr. Garden was named to CNBC’s Next List, composed of 100 next generation trailblazers expected to change the face of business over the next 25 years.
  Public company board experience: Mr. Garden is currently a director of General Electric Company, where he is a member of the Management Development & Compensation Committee. Mr. Garden previously served as a director of The Wendy’s Company, Family Dollar Stores, Inc., Pentair plc, The Bank of New York Mellon Corporation and Legg Mason, Inc.
 

 

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LOGO

William F. Glavin, Jr.

Non-executive director

Age             Tenure

62                2 Years

Committees:

  Audit
  Compensation
  Nomination and Corporate Governance

Qualifications:

  Executive leadership
  Industry experience
  Strategy and execution

 

LOGO

C. Robert Henrikson

Non-executive director

Age             Tenure

73                9 Years

Committees:

  Audit
  Compensation (Chair)
  Nomination and
Corporate Governance

Qualifications:

  Executive leadership
  Industry expertise
  International experience
  Strategy and execution

William F. Glavin, Jr.

William (“Bill”) F. Glavin, Jr. has served as a non-executive director of our company since 2019 and is nominated pursuant to a shareholder agreement with Massachusetts Mutual Life Insurance Company described on pages 68-70. Mr. Glavin served as vice chairman of MM Asset Management Holding LLC from 2015 until his retirement in 2017. Previously, Mr. Glavin served as chair of OppenheimerFunds Inc., (“OppenheimerFunds”), from 2009 to 2015, as chief executive officer from 2009 to 2014, and as president from 2009 to 2013. Prior to joining OppenheimerFunds Inc., Mr. Glavin held several senior executive positions at MassMutual Financial Group, including co-chief operating officer from 2007 to 2008 and executive vice president, U.S. Insurance Group from 2006 to 2008. He served as president and chief executive officer of Babson Capital Management LLC (“Babson”), from 2005 to 2006, and chief operating officer of Babson from 2003 to 2005. Prior to joining MassMutual, Mr. Glavin was president and chief operating officer of Scudder Investments from 2000 to 2003. Mr. Glavin held senior positions at the Dreyfus Corporation, the Boston Company, State Street Bank and Trust Company, and Procter & Gamble. Mr. Glavin earned a B.A. from the College of the Holy Cross.

Director qualifications

  Executive leadership, relevant industry experience: Mr. Glavin served five years as chief executive officer of OppenheimerFunds and has over 20 years of experience in the asset-management industry.
  Global business experience: Mr. Glavin’s experience as an executive of OppenheimerFunds and MassMutual has provided him with a global perspective that benefits our Board and our Management.
  Public company board experience: Mr. Glavin serves as a member of the board of directors of LPL Financial Holdings Inc. (audit and nominating and corporate governance committees).

C. Robert Henrikson

Robert Henrikson has served as a non-executive director of our company since 2012. Mr. Henrikson was president and chief executive officer of MetLife, Inc. and Metropolitan Life Insurance Company from 2006 through 2011, and he served as a director of MetLife, Inc. from 2005, and as Chairman from 2006 through 2011. During his more than 39-year career with MetLife, Inc., Mr. Henrikson held a number of senior positions in that company’s individual, group and pension businesses. He currently serves on the Bipartisan Policy Center’s Commission on Retirement Security and Personal Savings and the Board of Directors of the Bipartisan Center. Mr. Henrikson is a former Chairman of the American Council of Life Insurers, a former Chairman of the Financial Services Forum and a director emeritus of the American Benefits Council. Mr. Henrikson also serves as Chairman of the board of the S.S. Huebner Foundation for Insurance Education, as a trustee emeritus of Emory University and of Americares. Mr. Henrikson earned a bachelor’s degree from the University of Pennsylvania and a J.D. degree from Emory University School of Law. In addition, he is a graduate of the Wharton School’s Advanced Management Program.

Director qualifications

  Executive leadership, relevant industry experience: Mr. Henrikson’s more than 39 years of experience in the financial services industry, which includes diverse positions of increasing responsibility leading to his role as chief executive officer of MetLife, Inc., have provided him with an in-depth understanding of our industry.
  Public company board experience: Mr. Henrikson served on the Board of Directors of Swiss Re from 2012 to 2018. Until 2011, Mr. Henrikson served as the Chair of the board of MetLife, Inc.
 

 

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LOGO

Denis Kessler

Non-executive director

Age            Tenure

69                19 Years

Committees:

  Compensation
  Nomination
and Corporate Governance

Qualifications:

  Executive leadership
  Industry expertise
  International experience
  Strategy and execution

Denis Kessler

Denis Kessler has served as a non-executive director of our company since 2002. Mr. Kessler has served as Chairman and chief executive officer of SCOR SE since 2002. Prior to joining SCOR, Mr. Kessler was Chairman of the French Insurance Federation, senior executive vice president and member of the executive committee of the AXA Group and executive vice chairman of the French Business Confederation. Mr. Kessler is a Fellow of the French Institute of Actuaries and holds a PhD in economics and is a graduate of Ecole des Hautes Etudes Commerciales (HEC Paris). In addition, he holds honorary degrees from the Moscow Academy of Finance and the University of Montreal.

While Mr. Kessler is currently the CEO and Chair of a public company and serves as an outside director of two public companies (Invesco and BNP Paribas), he has demonstrated a continued commitment to Invesco. SCOR has announced that Mr. Kessler will transition from his role a CEO of SCOR SE in 2022, but he will continue to serve as SCOR SE’s Chairman of the Board of Directors after that time. Mr. Kessler’s unique perspective, fueled by his experience as an economist, his diverse international business experience and current position with a major global reinsurance company, significantly enhances the skill set of our Board of Directors by providing, among other things, valuable insight into both the investment management industry’s macro-economic positioning over the long-term across multiple geographies as well as our company’s particular challenges within that industry. The fact that his current position and experience is in a similar industry as the company, combined with his 19 years of service on our Board, allows Mr. Kessler to quickly achieve a sophisticated understanding of the issues to be addressed by the company and its industry.

In addition, his commitment is reflected by his attendance during 2020 at all of Invesco’s Board of Director’s meetings and all of the Board’s Committees on which he serves. Importantly, during 2020 and 2021’s unprecedented COVID-19 pandemic, which could be viewed as a global crisis and a material event for Invesco as a global company, Mr. Kessler’s dedication to the company and its Board strengthened despite other demands placed upon him during these unprecedented times.

Director qualifications

  Executive leadership, relevant industry experience: Mr. Kessler’s experience as an economist and chief executive of a major global reinsurance company have combined to give him valuable insight into both the investment management industry’s macro-economic positioning over the long-term as well as our company’s particular challenges within that industry.
  Global business experience: Mr. Kessler’s experience as a director of a variety of international public companies in several industries over the years enables him to provide effective counsel to our Board on many issues of concern to our management.
  Public company board experience: Mr. Kessler currently serves on the boards of SCOR SE and BNP Paribas SA (accounts committee (president)). He previously served on the boards of directors of Bollore from 1999 until 2013, Fonds Strategique d’Investissement from 2008 until 2013 and Dassault Aviation from 2003 until 2014
 

 

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LOGO

Nelson Peltz

Non-executive director

Age             Tenure

781                <1 Year

Committees:

  Nomination
and Corporate Governance

Qualifications:

  Executive leadership
  Industry experience
  Strategy and execution

Nelson Peltz

Nelson Peltz has served as a non-executive director of our company since November 2020 and has been Chief Executive Officer and a Founding Partner of Trian Fund Management, L.P. since its inception in 2005. From April 1993 through June 2007, Mr. Peltz served as Chairman and Chief Executive Officer of Triarc Companies, Inc. Mr. Peltz was Chairman and Chief Executive Officer and a director of Triangle Industries, Inc. from 1983 until December 1988.

Mr. Peltz is Honorary Co-Chairman of the Board of Trustees and Chairman of the Board of Governors of the Simon Wiesenthal Center. In addition, he is a member of the Board of Overseers of the Weill Cornell Medical College and Graduate School of Medical Sciences, a member and trustee of NewYork-Presbyterian Hospital, a member and governor of NewYork-Presbyterian Foundation, Inc., a member of the Board of Overseers of The Milken Institute, a member of the Honorary Board of Directors of the Prostate Cancer Foundation (formerly known as CaP CURE), a member of the Intrepid Advisory Council, a former member of the Board of Trustees of the Intrepid Museum Foundation and a member of the Board of Directors of the Avon Old Farms School. Mr. Peltz attended The Wharton School of the University of Pennsylvania.

Director qualifications

  Executive leadership, Industry experience: Mr. Peltz has over 40 years of business and investment experience and has served as chairman and chief executive officer of public companies for over 20 years. Throughout his professional career, he has developed extensive experience working with management teams and boards, as well as acquiring, investing in and building companies and implementing operational improvements at the companies with which he has been involved, including several in the asset management industry. Mr. Peltz also brings an institutional investor perspective to the Board.
  Public company board experience: Mr. Peltz serves as the non-executive Chairman of The Wendy’s Company and serves on the boards of The Procter & Gamble Company, Sysco Corporation, and Madison Square Garden Sports Corp.2 He previously served as a director of H. J. Heinz Company, Legg Mason, Inc., Ingersoll-Rand plc, MSG Networks Inc. and Mondelēz International, Inc. Mr. Peltz was recognized by The National Association of Corporate Directors in 2010, 2011 and 2012 as among the most influential people in the global corporate governance arena.

 

 

 

1

Mr. Peltz’s experience as CEO and Founding Partner of Trian Fund Management, L.P. is highly valuable to the Board and the Company. The Board therefore determined that these were special circumstances that warranted an exception to the age limits set forth in the Corporate Governance Guidelines and voted to nominate Mr. Peltz for election.

2

Mr. Peltz has advised us that he currently expects to reduce the number of other boards on which he serves from four to three by the end of 2021.

 

 

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LOGO

Sir Nigel Sheinwald

Non-executive director

Age             Tenure

67                6 Years

Committees:

  Audit
  Compensation
  Nomination and Corporate Governance

Qualifications:

  Executive leadership
  Technical - government, legal, regulatory and technology
  International experience
  Strategy and execution

 

LOGO

Paula C. Tolliver

Non-executive director nominee

Age

56

Committees:1

  Audit
  Compensation
  Nomination and Corporate Governance

Qualifications:

  Executive leadership
  International experience
  Strategy and execution
  Technical – government, legal regulatory and technology

Sir Nigel Sheinwald

Sir Nigel Sheinwald has served as a non-executive director of our company since 2015. Sir Nigel was a senior British diplomat who served as British Ambassador to the United States from 2007 to 2012, before retiring from Her Majesty’s Diplomatic Service. Previously, he served as Foreign Policy and Defence Adviser to the Prime Minister from 2003 to 2007 and as British Ambassador and Permanent Representative to the European Union in Brussels from 2000 to 2003. Sir Nigel joined the Diplomatic Service in 1976 and served in Brussels, Washington, Moscow, and in a wide range of policy roles in London. From 2014 to 2015, Sir Nigel served as the Prime Minister’s Special Envoy on intelligence and law enforcement data sharing. Sir Nigel also serves as a senior advisor to the Universal Music Group and Tanium, Inc. and is a visiting professor at King’s College, London. In addition, Sir Nigel serves on the Advisory Boards of the Ditchley Foundation, BritishAmerican Business and the Centre for European Reform. He is an Honorary Bencher of the Middle Temple, one of London’s legal inns of court. Sir Nigel received his M.A. degree from Balliol College, University of Oxford, where he is now an Honorary Fellow.

Director qualifications

  Global and governmental experience, executive leadership: Sir Nigel brings unique global and governmental perspectives to the Board’s deliberations through his more than 35 years of service in Her Majesty’s Diplomatic Service. His extensive experience leading key international negotiations and policy initiatives, advising senior members of government and working closely with international businesses positions him well to counsel our Board and senior management on a wide range of issues facing Invesco. In particular, Sir Nigel’s experience in the British government is a valuable resource for advising the Board with respect to the challenges and opportunities relating to regulatory affairs and government relations.
  Public company board experience: Sir Nigel currently serves on the Board of Directors of Royal Dutch Shell plc (Chair of the Safety, Environment and Sustainability Committee and member of the Nomination and Succession Committee).

Paula C. Tolliver

Paula C. Tolliver is a director nominee this year. She is the founder and principal of TechEdge, a consulting firm specializing in advising executive leadership on information technology strategies. Ms. Tolliver previously served as corporate vice president and chief information officer at Intel Corporation, a technology company, from 2016 to 2019. Prior to joining Intel, Ms. Tolliver served as corporate vice president of Business Services and chief information officer at The Dow Chemical Company (a wholly owned subsidiary of Dow, Inc.) from 2012 to 2016. Ms. Tolliver also led a services business for Dow Chemical, in addition to holding a variety of other roles in her 20 plus years with the company. She earned a bachelor’s degree in Business Information Systems and Computer Science from Ohio University.

Director qualifications

  Executive Leadership/Technical: Ms. Tolliver has significant experience and expertise in the areas of information technology and innovation. In particular, she has expertise in driving business growth, digital transformation, advanced analytics, cyber security and operational excellence.
  Public company board experience: Ms. Tolliver has served as a director of C.H. Robinson Worldwide, Inc. since 2018 and currently serves as a member of the audit and compensation committees.

 

 

 

If elected to the Board, Ms. Tolliver will serve on the following committees.

 

 

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LOGO

G. Richard Wagoner, Jr.

Chair of the Board

Age                 Tenure

68                    8 Years

Committees:

  Audit
  Compensation
  Nomination and Corporate Governance

Qualifications:

  Executive leadership
  International experience
  Accounting and financial reporting
  Strategy and execution

 

LOGO

Phoebe A. Wood

Non-executive director

Age                 Tenure

67                   11 Years

Committees:

  Audit (Chair)
  Compensation
  Nomination and Corporate Governance

Qualifications:

  Executive leadership
  International
  Accounting and financial reporting
  Strategy and execution

G. Richard Wagoner, Jr.

G. Richard (“Rick”) Wagoner, Jr. has served as Chair of our company since May 2019 and as a non-executive director of our company since 2013. Mr. Wagoner served as Chairman and chief executive officer of General Motors Corporation (“GM”) from 2003 through March 2009, and had been president and chief executive officer since 2000. Prior positions held at GM during his 32-year career with that company include president and chief operating officer, executive vice president and president of North American operations, executive vice president, chief financial officer and head of worldwide purchasing, and president and managing director of General Motors do Brasil. Mr. Wagoner is a member of the board of directors of Excelitas Technologies, a privately-held company. In addition, he advises several financial firms, start-ups and early-stage ventures. Mr. Wagoner is a member of the Virginia Commonwealth University Board of Visitors, the Duke Kunshan University Advisory Board and the Duke University’s Health System Board of Directors. In addition, he is a honorary member of the mayor of Shanghai, China’s International Business Leaders Advisory Council. Mr. Wagoner received his B.A. from Duke University and his M.B.A. from Harvard University.

Director qualifications

  Executive leadership, global business experience: Mr. Wagoner brings to the Board valuable business, leadership and management insights into strategic direction and international operations gained from his 32-year career with GM.
  Accounting and financial reporting expertise: Mr. Wagoner also brings significant experience in public company financial reporting and corporate governance matters gained through his service with other public companies. He has been designated as one of our audit committee’s financial experts, as defined under the rules of the Securities and Exchange Commission (“SEC”).
  Public company board experience: Mr. Wagoner has served on the Board of Graham Holdings Company (audit committee) since 2010 and also currently serves on the Board of ChargePoint Holdings, Inc.

Phoebe A. Wood

Phoebe Wood has served as a non-executive director of our company since 2010. She is currently a principal at CompaniesWood and served as vice chairman, chief financial officer and in other capacities at Brown-Forman Corporation from 2001 until her retirement in 2008. Prior to Brown-Forman, Ms. Wood was vice president, chief financial officer and a director of Propel Corporation (a subsidiary of Motorola) from 2000 to 2001. Previously, Ms. Wood served in various capacities during her tenure at Atlantic Richfield Company (ARCO) from 1976 to 2000. Ms. Wood currently serves on the boards of trustees for the Gheens Foundation and the American Printing House for the Blind (Chair). Ms. Wood received her A.B. degree from Smith College and her M.B.A. from the University of California Los Angeles.

Director qualifications

  Executive leadership, global business experience: Ms. Wood has extensive experience as both a director and a member of senior financial management of public companies in a variety of industries.
  Accounting and financial reporting expertise: Ms. Wood has significant accounting, financial and business expertise, which is valuable to our directors’ mix of skills, and she has been designated as one of our audit committee’s financial experts, as defined under the rules of the SEC.
  Public company board experience: Ms. Wood serves on the following boards: Leggett & Platt, Incorporated (audit (Chair ) committee), Pioneer Natural Resources Company (compensation and leadership development and nominating and corporate governance (Chair) committees) and PPL Corporation (audit, executive and governance and nominating (Chair) committees).
 

 

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Director independence

  In accordance with the rules of the New York Stock Exchange (“NYSE”), the Board has affirmatively determined that it is currently composed of a majority of independent directors, and that the following current directors and director nominee are independent and do not have a material relationship with the company: Sarah E. Beshar, Thomas M. Finke, Edward P. Garden, William F. Glavin, Jr., C. Robert Henrikson, Denis Kessler, Nelson Peltz, Sir Nigel Sheinwald, Paula C. Tolliver, G. Richard Wagoner, Jr. and Phoebe A. Wood.
  For a director to be considered independent, the Board must affirmatively determine that the director does not have any material relationship with the company either directly or as a partner, shareholder or officer of an organization that has a relationship with the company. Such determinations are made and disclosed according to applicable rules established by the NYSE or other applicable rules.
  As part of its independence determinations, the Board considers any direct or indirect relationship between a director (or an immediate family member of such director) and the company or any third party involved with the company. As part of its independence determinations with respect to director Sarah E. Beshar, the Board considered certain third-party transactions previously disclosed, which in total were significantly below the required independence thresholds.

 

 

Board meetings and annual general meeting of shareholders

  During the calendar year ended December 31, 2020, the Board held eleven meetings (not including committee meetings).
  Each director attended at least seventy-five percent (75%) of the aggregate of the total number of meetings held by the Board and all committees of the Board on which he or she served during 2020.
  All of our directors attended the 2020 Annual General Meeting. The Board does not have a formal policy regarding Board member attendance at shareholder meetings.
  The non-executive directors (those directors who are not officers or employees of the company and who are classified as independent directors under applicable NYSE standards) meet in executive session each quarter at a minimum.
  G. Richard Wagoner, Jr., our Chair and a non-executive director, presides at the executive sessions of the non-executive directors.

 

 

Committee membership and meetings

  The current committees of the Board are the audit committee, the compensation committee and the nomination and corporate governance committee.
  The Board has affirmatively determined that each committee consists entirely of independent directors according to applicable NYSE rules and rules promulgated under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), including the heightened independence standards for compensation committee and audit committee members.

 

Members:

Sarah E. Beshar

Thomas M. Finke1

William F. Glavin, Jr.

C. Robert Henrikson

Sir Nigel Sheinwald

G. Richard Wagoner, Jr.

Phoebe A. Wood (Chair)

 

Independence:

Each member of the committee is independent and financially literate

 

Audit Committee

Financial Experts:

Ms. Wood and

Mr. Wagoner qualify as
defined by SEC rules

 

Meetings held in 2020:

10

  

 

The Audit Committee

Under its charter, the committee:

•  is comprised of at least three members of the Board and each is “independent” under the rules of the NYSE and SEC and is also “financially literate,” as defined under NYSE rules;

•  members are appointed and removed by the Board;

•  is required to meet at least quarterly;

•  periodically meets with the head of Internal Audit and the independent auditor in separate executive sessions without members of senior management present; and

•  has the authority to retain independent advisors, at the company’s expense, whenever it deems appropriate to fulfill its duties.

 

The committee’s charter sets forth its responsibilities, including assisting the Board in fulfilling its responsibility to oversee:

•  the company’s financial reporting, auditing and internal control activities, including the integrity of the company’s financial statements;

•  the independent auditor’s qualifications and independence;

•  the performance of the company’s internal audit function and independent auditor; and

•  the company’s compliance with legal and regulatory requirements.

 

The committee’s charter is available at www.invesco.com/corporate (the “company’s website”).

1 Mr. Finke joined the Audit Committee effective December 1, 2020.

 

 

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Members:

Sarah E. Beshar

Thomas M. Finke1

Edward P. Garden2

William F. Glavin, Jr.

C. Robert Henrikson (Chair)

Denis Kessler

Sir Nigel Sheinwald

G. Richard Wagoner

Phoebe A. Wood

 

Independence:

Each member of the

committee is independent

 

Meetings held in 2020:

6

  

 

The Compensation Committee

Under its charter, the committee:

•  is comprised of at least three members of the Board, each of whom is “independent” of the company under the NYSE and SEC rules;

•  members are appointed and removed by the Board;

•  is required to meet at least four times annually; and

•  has the authority to retain independent advisors, at the company’s expense, whenever it deems appropriate to fulfill its duties, including any compensation consulting firm.

 

The committee’s charter sets forth its responsibilities, including:

•  annually approving the compensation structure for, and reviewing and approving the compensation of, senior officers and non-executive directors;

•  overseeing the annual process for evaluating senior officer performance;

•  overseeing the administration of the company’s equity-based and other incentive compensation plans; and

•  assisting the Board with executive succession planning.

 

The committee’s charter is available on the company’s website.

 

In addition, the committee meets at least annually to review and determine the compensation of the company’s non-executive directors.

 

Members:

Sarah E. Beshar (Chair)

Thomas M. Finke1

Edward P. Garden2

William F. Glavin, Jr.

C. Robert Henrikson

Denis Kessler

Nelson Peltz3

Sir Nigel Sheinwald

G. Richard Wagoner, Jr.

Phoebe A. Wood

 

Independence:

Each member of the

committee is independent

and financially literate

 

Meetings held in 2020:

6

  

 

The Nomination and Corporate Governance Committee

Under its charter, the committee:

•  is comprised of at least three members of the Board, each of whom is “independent” of the company under the NYSE and SEC rules;

•  members are appointed and removed by the Board;

•  is required to meet at least four times annually; and

•  has the authority to retain independent advisors, at the company’s expense, whenever it deems appropriate to fulfill its duties.

 

The committee’s charter sets forth its responsibilities, including:

•  establishing procedures for identifying and evaluating potential nominees for director;

•  recommending to the Board potential nominees for election; and

•  periodically reviewing and reassessing the adequacy of the Corporate Governance Guidelines to determine whether any changes are appropriate and recommending any such changes to the Board for its approval.

 

The committee’s charter is available on the company’s website. For more information regarding the director recruitment process, see Information about Director Nominees - Director recruitment.

 

 

 

1  Mr. Finke joined the Compensation and Nomination and Corporate Governance Committees effective December 1, 2020.

2  Mr. Garden joined the Compensation and Nomination and Corporate Governance Committees effective November 4, 2020.

3  Mr. Peltz joined the Nomination and Corporate Governance Committee effective November 4, 2020.

 

 

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Director compensation

The compensation committee annually reviews and determines the compensation paid to non-executive directors. No executive officer of the company is involved in recommending or determining non-executive director compensation levels. Mr. Flanagan does not receive compensation for his service as a director. The committee considers, among other things, the following policies and principles:

  that compensation should fairly pay the non-executive directors for the work, time commitment and efforts required by directors of an organization of the company’s size and scope of business activities, including service on Board committees;
  that a component of the compensation should be designed to align the non executive directors’ interests with the long-term interests of the company’s shareholders; and
  that non-executive directors’ independence may be compromised or impaired if director compensation exceeds customary levels.

As a part of its annual review, the committee engaged Johnson Associates, Inc. (“Johnson Associates”) as a third-party consultant to report on comparable non-executive director compensation practices and levels. This report included a review of director compensation at the same peer companies the committee considers for executive compensation practices. See page 57 for a list of our 2020 peers.

In December 2019, following its annual review, the compensation committee determined that the annual equity award value would increase from $145,000 to $180,000 for the 2020 service period. All other compensation for the 2020 service period would remain the same. The committee also added a one-year vesting requirement for equity awards commencing with the 2020 service period. In April 2020, given the then-current condition of the market resulting from the COVID-19 pandemic, the Board determined to revert the compensation of non-executive directors to 2019 compensation levels. As a result, the increase to the equity award value did not occur. The one-year vesting requirement for equity awards for the 2020 service period remains in place.

The compensation for non-executive directors for the 2020 service period was as follows, with each component paid in quarterly installments in arrears:

 

Basic cash fee    Non-executive directors (other than the Chair of the Board) received an annual basic fee paid in cash in the amount of $120,000
Chair fee    In lieu of the above basic cash fee, the Chair of the Board received an annual cash fee of $400,000
Basic shares fee    Non-executive directors also received an annual award of shares in the aggregate amount of $145,000. Beginning with the quarter ended March 31, 2020 equity awards are subject to a one-year vesting requirement

Audit Committee

Chair fee

   The Chair of the audit committee received an additional annual cash fee of $50,000
Compensation and Nomination and Corporate Governance Committee Chair’s fee    The Chair of the compensation committee and the Chair of the nomination and corporate governance committee each received an additional annual cash fee of $15,000

We also reimburse each of our non-executive directors for their travel expenses incurred in connection with attendance at Board of Directors and committee meetings. Directors do not receive any meeting or attendance fees. Invesco does not have a deferred compensation plan for its directors.

In December 2020, following its annual review, the compensation committee determined that compensation for the 2021 service period would remain the same. In addition, the compensation committee approved the transition of granting equity awards from a quarterly basis to an annual basis.

 

 

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Stock ownership policy for non-executive directors — All shares granted to our non-executive directors are subject to the Non-Executive Director Stock Ownership Policy. The policy generally requires each non-executive director to achieve and thereafter maintain an ownership level of at least 18,000 shares within seven years of such director’s first appointment as a non-executive director. Until such ownership level is achieved, each non-executive director is generally required to continue to retain at least 50% of all shares received as compensation from the company. The following table shows the status of our non-executive directors meeting the requirements of the policy as of December 31, 2020.

 

 

2020 Non-executive director stock ownership

Shares held as of December 31, 2020

 

Name    Shares held    Requirement met    Name   Shares held    Requirement met  

Beshar

   49,740    LOGO    Kessler   73,078    LOGO

Finke1,2

   0         Peltz3   45,457,427    LOGO

Garden3

   45,457,427    LOGO    Sheinwald   36,561    LOGO

Glavin2

   15,677         Wagoner   57,463    LOGO

Henrickson

   61,472    LOGO    Wood   53,528    LOGO

 

1

Mr. Finke joined the Board effective December 1, 2020.

2

Based on current compensation levels, it is anticipated that Messrs. Finke and Glavin will attain the share ownership goal within the time period prescribed by the policy.

3

Includes 45,457,427 common shares which may be deemed to be beneficially owned by Trian Fund Management, L.P. (“Trian”) as of December 31, 2020. Trian Fund Management GP, LLC, of which each of Mr. Peltz and Mr. Garden are members, is the general partner of Trian, and therefore is in a position to determine the investment and voting decisions made by Trian. Accordingly, each of Mr. Peltz and Mr. Garden may be deemed to indirectly beneficially own all of the common shares that Trian beneficially owns.

 

 

Director compensation table

The following table sets forth the compensation paid to our non-executive directors during 2020.

 

Name   

Fees earned or paid

in cash ($)1

     Share awards ($)2      Total ($)  

Sarah E. Beshar

     120,000        144,979        264,979  

Joseph R. Canion

     135,000        144,979        279,979  

Thomas M. Finke

                    

Edward P. Garden

                    

William F. Glavin, Jr.

     120,000        144,979        264,979  

C. Robert Henrikson

     135,000        144,979        279,979  

Denis Kessler

     120,000        144,979        264,979  

Nelson Peltz

                    

Sir Nigel Sheinwald

     120,000        144,979        264,979  

G. Richard Wagoner, Jr.

     400,000        144,979        544,979  

Phoebe A. Wood

     170,000        144,979        314,979  

 

1

Includes the annual basic cash fee and, as applicable, Chair of the Board fee and committee Chair fees.

2

Reflects the grant date fair value for each share award. Share awards for the quarter ended December 31, 2019 were 100% vested as of the date of grant. Beginning with the quarter ended March 31, 2020, share awards are 100% vested on the one-year anniversary of the date of grant.

 

 

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The following table presents the grant date fair value for each share award made to each non-executive director during 2020.

 

2020 Director grant date fair value  
Name   

Date of grant

1/30/20 ($)

    

Date of grant

4/24/20 ($)

    

Date of grant

7/29/20 ($)

    

Date of grant

10/28/20 ($)

    

Total grant date

fair value ($)

 

Sarah E. Beshar

     36,247        36,247        36,241        36,244        144,979  

Joseph R. Canion

     36,247        36,247        36,241        36,244        144,979  

Thomas M. Finke1

                                  

Edward P. Garden1

                                  

William F. Glavin

     36,247        36,247        36,241        36,244        144,979  

C. Robert Henrikson

     36,247        36,247        36,241        36,244        144,979  
           

Denis Kessler

     36,247        36,247        36,241        36,244        144,979  

Nelson Peltz1

                                  

Sir Nigel Sheinwald

     36,247        36,247        36,241        36,244        144,979  

G. Richard Wagoner, Jr.

     36,247        36,247        36,241        36,244        144,979  

Phoebe A. Wood

     36,247        36,247        36,241        36,244        144,979  

1 Messrs. Garden and Peltz were elected to the Board effective November 4, 2020. Mr. Finke was elected to the Board effective December 1, 2020.

 

 

2021 Proxy Statement        17


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Director outstanding awards table

The following table provides information about outstanding equity awards held by our non-executive directors as of December 31, 2020.

 

Name    Date of grant     

Number of shares or units that

have not vested1,2

 

Sarah E. Beshar

     04/24/20        4,647  
     07/29/20        3,419  
     10/28/20        2,719  
     

Total

              10,785  

Joseph R. Canion

     04/24/20        4,647  
     07/29/20        3,419  
     10/28/20        2,719  
     

Total

              10,785  

Thomas M. Finke3

               

Edward P. Garden3

               

William F. Glavin, Jr.

     04/24/20        4,647  
     07/29/20        3,419  
     10/28/20        2,719  
     

Total

              10,785  

C. Robert Henrikson

     04/24/20        4,647  
     07/29/20        3,419  
       10/28/20        2,719  

Total

              10,785  

Denis Kessler

     04/24/20        4,647  
     07/29/20        3,419  
     10/28/20        2,719  
     

Total

              10,785  

Nelson Peltz3

               

Sir Nigel Sheinwald

     04/24/20        4,647  
     07/29/20        3,419  
     10/28/20        2,719  
     

Total

              10,785  

G. Richard Wagoner, Jr.

     04/24/20        4,647  
     07/29/20        3,419  
     10/28/20        2,719  
     

Total

              10,785  

Phoebe A. Wood

     04/24/20        4,647  
     07/29/20        3,419  
     10/28/20        2,719  
     

Total

              10,785  

1 Time-based equity awards granted under the 2016 Global Equity Incentive Plan vest in one installment on the one-year anniversary of the date of grant.

2 Dividends and dividend equivalents on unvested time-based equity awards are paid at the same time and rate as on our shares.

3 Messrs. Garden and Peltz were elected to the Board effective November 4, 2020. Mr. Finke was elected to the Board effective December 1, 2020.

 

 

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Proposal

1

Election of directors

You are being asked to cast votes for twelve director nominees: Sarah E. Beshar, Thomas M. Finke, Martin L. Flanagan, Edward P. Garden, William F. Glavin, Jr., C. Robert Henrikson, Denis Kessler, Nelson Peltz, Sir Nigel Sheinwald, Paula C. Tolliver, G. Richard Wagoner, Jr. and Phoebe A. Wood.

 

  A director holds office until such director’s successor has been duly elected and qualified or until such director’s death, resignation or removal from office under our Bye-Laws.
  Each director is elected for a one-year term ending at the 2022 Annual General Meeting.
  The Board currently has eleven directors. Paula C. Tolliver is a new director nominee. Ms. Tolliver was initially identified as a potential candidate by an external search firm. The Board is excited to welcome Ms. Tolliver to its membership following the 2021 Annual General Meeting and believes that she possesses the skills and qualifications to make a significant contribution to our Board.
  Each nominee has indicated to the company that he or she would serve if elected. We do not anticipate that any director nominee will be unable to stand for election, but if that were to happen, the Board may reduce the size of the Board, designate a substitute or leave a vacancy unfilled. If a substitute is designated, proxies voting on the original director nominee will be cast for the substituted candidate.
  Under our Bye-Laws, at any general meeting held for the purpose of electing directors at which a quorum is present, each director nominee receiving a majority of the votes cast at the meeting will be elected as a director.
  If a nominee for director who is an incumbent director is not elected and no successor has been elected at the meeting, the director is required under our Bye-Laws to submit his or her resignation as a director. Our nomination and corporate governance committee would then make a recommendation to the full Board on whether to accept or reject the resignation.
  If the resignation is not accepted by the Board, the director will continue to serve until the next annual general meeting and until his or her successor is duly elected, or his or her earlier resignation or removal.
  If the director’s resignation is accepted by the Board, then the Board may fill the vacancy. However, if the number of nominees exceeds the number of positions available for the election of directors, the directors so elected shall be those nominees who have received the greatest number of affirmative votes cast at the virtual Annual General Meeting or by proxy.

 

 

 

LOGO

 

 

FOR

  

 

Recommendation of the Board of Directors

The board of directors unanimously recommends a vote “FOR” the election to the board of each of the director nominees.

 

Vote required: This proposal requires the affirmative vote of a majority of votes cast at the Annual General Meeting.

 

 

 

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Corporate governance

 

 

Corporate governance guidelines

The Board has adopted Corporate Governance Guidelines (“Guidelines”) and Terms of Reference for our Chair and for our Chief Executive Officer, each of which is available in the corporate governance section of the company’s website. The Guidelines set forth the practices the Board follows with respect to, among other matters, the composition of the Board, director responsibilities, Board committees, director access to officers, employees and independent advisors, director compensation and performance evaluation of the Board.

 

 

Code of conduct and directors’ code of conduct

As part of our ethics and compliance program, our Board has approved a code of ethics (the “Code of Conduct”) that applies to our principal executive officer, principal financial officer, principal accounting officer and persons performing similar functions, as well as to our other officers and employees. The Code of Conduct is posted on the company’s website. In addition, we have adopted a separate Directors’ Code of Conduct that applies to all members of the Board. We intend to satisfy the disclosure requirement regarding any amendment to, or a waiver of, a provision of the Code of Conduct for our directors and executive officers by posting such information on the company’s website. The company maintains a compliance reporting line, where employees and individuals outside the company can anonymously submit a complaint or concern regarding compliance with applicable laws, rules or regulations, the Code of Conduct, as well as accounting, auditing, ethical or other concerns.

 

 

Board leadership structure

As described in the Guidelines, the company’s business is conducted day-to-day by its officers, managers and employees, under the direction of the Chief Executive Officer and the oversight of the Board, to serve the interest of our clients and enhance the long-term value of the company for its shareholders. The Board is elected by the shareholders to oversee our management team and to seek to assure that the long-term interests of the shareholders are being served. In light of these differences in the fundamental roles of the Board and management, the company has chosen to separate the Chief Executive Officer and Board Chair positions. The Board believes separation of these roles: (i) allows the Board to more effectively monitor and evaluate objectively the performance of the Chief Executive Officer, such that the Chief Executive Officer is more likely to be held accountable for his performance; (ii) allows the non-executive Chair to control the Board’s agenda and information flow; and (iii) creates an atmosphere in which other directors are more likely to challenge the Chief Executive Officer and other members of our senior management team. For these reasons, the company believes that this board leadership structure is currently the most appropriate structure for the company. Nevertheless, the Board may reassess the appropriateness of the existing structure at any time, including following changes in board composition, in management or in the character of the company’s business and operations.

 

 

Director recruitment

The nomination and corporate governance committee identifies and adds new directors using the following process:

 

LOGO  

The committee reviews and updates its criteria for prospective directors based on succession planning for directors, to fill gaps in skill sets among current directors and to address new or evolving needs of the company. The committee then utilizes each of the following recommendations to determine the candidates for consideration:

•  Directors

•  Independent search firms

 

Candidates meet with the committee members, the Board Chair, the other Board members and the CEO who assess candidates based on several factors, including whether the candidate has skills that will assist the company in seeking to meet its long-term strategic objectives and will bring diversity of thought and the desired qualifications to our Board. While the Board has no formal policy regarding diversity, as the Board reviews its needs for additional directors, the Board routinely considers gender, ethnic and other diversity factors.

 

 

 

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LOGO

 

Due diligence is conducted, including soliciting feedback on potential candidates from persons outside the Company. Qualified candidates are presented to the Board of Directors.

 

  Three new directors and one director nominee since 2019 adding the following skills and traits to our Board:
 

•  Gender and geographic diversity

•  International experience

•  Accounting and financial reporting

•  Technical - government, legal, regulatory and technology

  

•  Strategy and execution

•  Industry experience

•  Executive leadership

The nomination and corporate governance committee believes there are certain minimum qualifications that each director nominee must satisfy in order to be suitable for a position on the Board, including that such nominee:

  be an individual of the highest integrity and have an inquiring mind, a willingness to ask hard questions and the ability to work well with others;
  be free of any conflict of interest that would violate any applicable law or regulation or interfere with the proper performance of the responsibilities of a director;
  be willing and able to devote sufficient time to the affairs of the company and be diligent in fulfilling the responsibilities of a director and Board committee member; and
  have the capacity and desire to represent the best interests of the shareholders as a whole.

The committee will consider candidates recommended for nomination to the Board by shareholders of the company. Shareholders may nominate candidates for election to the Board under Bermuda law and our Bye-Laws. The manner in which the committee evaluates candidates recommended by shareholders would be generally the same as any other candidate. However, the committee would also seek and consider information concerning any relationship between a shareholder recommending a candidate and the candidate to determine if the candidate can represent the interests of all of the shareholders. For further information regarding deadlines for shareholder proposals, see Important additional information — Shareholder proposals for the 2022 annual general meeting on page 88.

 

 

Director orientation and continuing education and development

When a new independent director joins the Board, we provide an orientation program for the purpose of providing the new director with an understanding of the strategy and operations of the company. To assist the directors in understanding the company and its industry and maintaining the level of expertise required for our directors, the company ‘s management team makes presentations during Board meetings relating to the competitive and industry environment and the company’s goals and strategies. In addition, at most meetings the Board receives presentations on various topics related to key industry trends, topical business issues and governance.

Each director is encouraged to participate in continuing education programs for public company directors sponsored by nationally recognized educational organizations not affiliated with the company. The cost of all such continuing education is paid for by the company.

 

 

Board evaluation process

 

LOGO   

The Board engages an independent external advisor to coordinate the Board’s self-assessment by its members. The advisor has each director review a questionnaire and then performs one-on-one confidential interviews with directors. In addition to the questionnaires and interviews of each director, interviews are also conducted with those members of executive management who attend Board meetings on a regular basis.

 

The advisor prepares and presents a report to the Board, which discusses the findings of the advisor based upon its reviews.

 

The Board then discusses the evaluation to determine what action, if any, could further enhance the operations of the Board and its committees.

 

 

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Shareholder engagement

Why we engage

One of our key priorities is ensuring robust outreach and engagement with our shareholders in order to:

  Provide transparency into our business, governance practices and compensation programs
  Determine which issues are important to our shareholders and share our views on those issues
  Identify emerging trends or issues that may impact our business and influence our practices

How we engage

 

 

LOGO   

Investor relations and senior management

We provide institutional investors with many opportunities to provide feedback to senior management by participating in conferences, one-on-one and group meetings throughout the year.

 

LOGO   

Shareholders

Consistently for many years, we have engaged with representatives of our major shareholders through conference calls that occur outside of proxy season. These exchanges cover our executive compensation program, risk management, ESG, strategic planning processes and current and emerging governance practices generally and specifically with respect to Invesco.

  

As investment professionals, we know the value of engaging with companies and seek to maintain an active and open dialogue with our shareholders. Although in 2020 we were not able to engage in person with our shareholders, we were able to virtually engage with them. We attempt to incorporate and address the feedback

we receive from our shareholders into our practices. We look forward to continuing to expand our shareholder outreach efforts.

 

  

How we interact

 

•  Conference attendance

•  Investor meetings

•  One-on-one meetings with shareholders

•  Outreach, calls and meetings with investor corporate governance departments

•  Universal access to an email address for shareholders who wish to contact our Board

  

Topics discussed

 

•  Company performance and progress against our long-term strategy

•  Executive compensation program

•  Current and emerging corporate governance practices and industry trends, including ESG considerations

•  Risk management

•  Strategic planning

•  Regulatory considerations

•  Board composition and leadership structure

   In addition to our year-round shareholder engagement, we also conduct a targeted shareholder and proxy adviser outreach in the Fall of each year. See Shareholder and proxy advisory engagement and feedback below for more information on this outreach and related findings.

 

 

 

 

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Communications with the Chair and other non-executive directors

Any interested party may communicate with the Chair of our Board or our non executive directors as a group at the following address:

Invesco Ltd.

1555 Peachtree Street N.E.

Atlanta, Georgia 30309

Attn: Office of the Company Secretary, Legal Department

Communications will be distributed to the Board, or to any of the Board’s committees or individual directors as appropriate, depending on the facts and circumstances of the communication. In that regard, the Invesco Board does not receive certain items which are unrelated to the duties and responsibilities of the Board.

In addition, the company maintains the Invesco Compliance Reporting Line for its employees or individuals outside the company to report complaints or concerns on an anonymous and confidential basis regarding questionable accounting, internal accounting controls or auditing matters and possible violations of the company’s Code of Conduct or law. Further information about the Invesco Compliance Reporting Line is available at the company’s website. The information on the company’s website is not intended to form a part of, and is not incorporated by reference into, this proxy statement.

Non-employees may submit any complaint regarding accounting, internal accounting controls or auditing matters directly to the audit committee of the Board of Directors by sending a written communication addressed to the Audit Committee at the address set forth above.

 

 

Board’s role in risk oversight

The Board has oversight responsibility for the company’s risk management processes including the monitoring of the company’s overall risk profile. Though Board committees address specific risks and risk processes within their purview, the Board has not delegated risk oversight to a committee as full Board engagement supports appropriate consideration of risk in strategy setting and a more holistic understanding of risk across the enterprise.

Invesco is committed to continually strengthening and evolving our risk management activities to ensure they keep pace with business change and client expectations. We believe a key factor in our ability to manage through challenging market conditions and significant business change is our integrated and global approach to risk management. Risk management is embedded in our day-to-day decision-making as well as our strategic planning process while our global risk management framework enables consistent and meaningful risk dialogue up, down and across the company. Our framework leverages two governance structures: (i) our Global Performance and Risk Committee oversees the management of core investment risks; and (ii) our Corporate Risk Management Committee oversees the management of all other business and strategy related risks. A network of regional, business unit and specific risk management committees, with oversight of the Corporate Risk Management Committee, provides ongoing identification, assessment, management and monitoring of risk that ensures both broad as well as in-depth, multi-layered coverage of the risks existing and emerging in the various domains of our business.

One of these risk management committees, the Global Security Oversight Committee, provides executive level oversight and monitoring of the end-to-end programs dedicated to managing information security and cyber related risk. Important to these programs is our investment in threat-intelligence, our active engagement in industry and government security-related forums and our utilization of external experts to challenge our program maturity, assess our controls and routinely test our capabilities.

The Board reviews and discusses with executive and senior management risk management information and reporting provided, at least quarterly, by the Global Performance and Risk Committee and the Corporate Risk Management Committee. The Board also reviews and approves the company’s risk appetite statement and crisis management framework. By receiving these reports, the Board maintains a practical understanding of the company’s risk management processes, overall risk profile and risk culture. In addition, Board and committee agenda business-related topics include discussion of the risks in our ongoing business as well as those introduced by new business developments. Through this regular and consistent risk communication and dialogue, the Board seeks to maintain reasonable assurance that all material risks of the company are being addressed and that the company is fostering a risk-aware culture in which effective risk management is embedded in the business.

 

 

2021 Proxy Statement        23


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Our risk management framework

 

LOGO

In addition, the compensation committee annually assesses the risks of our compensation policies and practices. The compensation committee has concluded our policies and practices do not create risks that are reasonably likely to have a material adverse effect on the company. In reaching this conclusion, the compensation committee considered the input of a working group comprised of representatives from our human resources and finance departments that reviewed each of Invesco’s compensation plans.

Invesco’s compensation programs are designed to reward success over the long-term, promote a longer-term view of risk and return in decision making and seeks to protect against incentives for inappropriate risk taking. Examples of risk mitigation in our compensation program design include:

  Consideration of multiple performance metrics in establishing the company-wide annual incentive pool each year, so no one metric creates an undue reward that might encourage excessive risk taking;
  The vast majority of investment professional bonus plans have multi-year measurement periods and are weighted to longer-term performance, caps on earnings and discretionary components;
  Sales and commission plans generally contain multiple performance measures and discretionary elements; and
  Executives receive a substantial portion of compensation in the form of long-term equity that vests over multi-year periods. Time-based equity awards vest ratably over a four-year period. Performance-based equity awards for executive officers are subject to a three-year performance period and three-year cliff vesting. The achievement of financial performance for the performance-based equity awards must be certified by the compensation committee and the awards are subject to a clawback. Executive officers are also subject to our stock ownership policy.

The audit committee routinely receives reports from the control functions of finance, legal, compliance and internal audit. The Global Head of Internal Audit reports to the Chair of the audit committee. The audit committee oversees the internal audit function’s planning and resource allocation in a manner designed to ensure testing of controls and other internal audit activities are appropriately prioritized in a risk-based manner. The audit committee also seeks to assure that appropriate risk-based inputs from management and internal audit are communicated to the company’s independent public auditors.

Cyber security

At a time when cyber threats are considered one of the most significant risks facing financial institutions, we continue to invest in our security capabilities to keep clients, employees, and critical assets safe, uphold privacy rights, and enable a secure and resilient business. We have a designated Global Chief Security Officer and have a global security program that combines information (including cyber) security, physical security, privacy, business recovery and operational resilience, and strategy and reporting under a single umbrella supported by an intelligence function that provides timely threat information.

Our information security program, led by our Chief Information Security Officer, is designed to oversee and maintain all aspects of information security risk and seeks to ensure the confidentiality, integrity and availability of information assets. This includes the implementation of controls aligned with industry guidelines and applicable statutes and regulations to identify threats, detect attacks and protect these information assets. We have an incident response program that includes periodic testing and is designed to restore business operations as quickly and as orderly as possible in the event of a breach.

 

 

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We are rooted in the belief that our role as one of the world’s leading independent investment management organizations is to serve as a trusted partner to our clients, shareholders, employees and communities, including our natural environment. We recognize that ESG matters greatly — it matters to us.   

 

Environmental, social and governance (“ESG”) responsibility

 

Invesco’s commitment to ESG investment stewardship

Environmental, social and governance (“ESG”) investing is a fundamental commitment at Invesco. Invesco employs a purposeful, holistic and integrated approach to ESG investment stewardship. Our fundamental belief is that ESG investing is an essential part of the solution to a sustainable future. We view it as an important agent of change in driving a holistic perspective on the investment industry’s role in creating value.

 

Sustainable value creation and effective risk mitigation are fundamental to our purpose to deliver an investment experience that helps people get more out of life. As a result, our focus is on integrating ESG into the heart of our investment process, with our investment teams making decisions every day on how to manage this integration. Invesco has been implementing ESG investment strategies for over 30 years and today we deliver these strategies through a number of products and mandates:

  

•  equities

•  alternatives

•  bespoke investment solutions

  

•  fixed income

•  real estate

  

•  multi-asset

•  ETFs

   Our commitment goes far beyond delivering specific ESG investment solutions – it goes to:
  

•  the way we work with our clients to realize the value they seek;

•  how we use our leverage in important areas such as portfolio company engagement and proxy voting; and

•  our work to achieve specific client needs, using skills such as our self-indexing capabilities to provide the right ESG solutions.

   To that end, Invesco is a signatory to a number of leading ESG investment organizations, including:

    

   LOGO

What is Invesco doing to put ESG at the forefront of our role as investors?

 

1    ESG INTEGRATION EVERYWHERE
   Various aspects of ESG have an impact on sustainable value creation, as well as risk management. We aspire to incorporate ESG considerations in all our investment capabilities and processes. In general, investment teams incorporate ESG considerations as one input to their investment process as part of the evaluation of ideas, company dialogue and portfolio monitoring. As such, assessment of ESG aspects is incorporated into the wider investment process as part of a holistic consideration of the investment risk and opportunity. ESG aspects may therefore be considered alongside other economic drivers when evaluating the attractiveness of an investment. Our investment managers have absolute discretion in taking a view on any given ESG risk or opportunity.
2    BENEFITING FROM DIVERSITY OF THOUGHT
   We value diversity of thought so our ESG implementation is not generic. Our Global ESG team functions as a center of excellence, setting standards and providing specialist insights on research, engagement, voting, integration, tools, client and product solutions. Invesco’s Chief Investment Officers and teams leverage this resource to tailor and implement ESG approaches relevant to their asset classes and investment styles.
3    USING OUR INFLUENCE
   Much of our work is rooted in fundamental research and frequent dialogue with companies making Invesco well placed to use our ESG expertise and beliefs in ways that drive corporate change. As a provider of both active and passive strategies, we amplify our active votes as our passive vote typically follows the largest active holder. In addition to corporate change we also participate in extensive industry dialogue to influence systemic industry developments.
 

 

2021 Proxy Statement        25


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4

  

A TRACK RECORD TO BUILD ON

We have a recognized ESG track record. For the last four consecutive years, we’ve achieved an A+ rating from the PRI (Principles for Responsible Investment) for our strategy and governance. In Private Markets, over the last five years, Invesco Real Estate has been recognized by GRESB as a global leader in its sustainable management of buildings.

  

5

  

CLIMATE AS A FOCUS TOPIC

Climate change is a key focus for us and our clients. Invesco has committed to the Task Force on Climate-related Financial Disclosures and we are part of the solution by supporting and investing in companies that are allocating capital towards the transition. For more detail please see our Climate Change Report on our company website.

  

6

  

A COMMITMENT TO SOLUTIONS

Increasingly, our clients want us to provide the means for them to explicitly express their own ESG values through investment vehicles. We will continue to develop innovative solutions and products to deliver for them. Already, we manage more than $34 billion1 in dedicated sustainable investing strategies and we will continue to build on our experience.

  

For more information regarding Invesco’s ESG investment stewardship, please see our most recent ESG Investment Stewardship Report on the company’s website.

Invesco’s corporate stewardship

At Invesco, corporate stewardship matters. Our efforts are motivated by the belief that doing what is right for the environment, our people and the communities in which we have a presence helps us deliver positive outcomes for our shareholders. Our senior leaders and our employees are committed to the communities where we live, work and volunteer. We actively partner with non-profits, start-ups and other organizations to strengthen our communities. Our areas of focus are:

•  improving financial education,

•  protecting the environment,

•  promoting environmental sustainability,

  

•  championing diversity and inclusion in our industry and our company, and

  

•  supporting and collaborating with local civic and community organizations.

Through Invesco Cares and Environmental Green Teams, local Invesco offices identify areas of need that are unique to each specific community. Our Environmental Green Teams focus on preserving and improving the environment by focusing on reducing carbon emissions, eliminating plastic consumption, promoting waste awareness and recycling electronic computers and laptops. These groups also volunteer to clean up local community parks, plant trees and clean up marine areas around the globe. The Invesco culture encourages employees to go beyond their work responsibilities, and join with like-minded colleagues, to make an impact in communities we serve. Invesco Cares partners with local charitable organizations around the globe through volunteering, sharing our skills, and raising funds to improve the local communities where we work.

Invesco strives to align with the Global Reporting Initiative (GRI) standard reporting guidelines and Sustainability Accounting Standards Board (SASB) metrics for Asset Management & Custody Activities as further detailed in our Corporate Social Responsibility Report, which is available on the company website.

 

For 2019, Invesco offset

20,994 tons of carbon

dioxide emissions

through our partnership

with ClimateCare,

representing all of our air

and rail travel purchased through our third-party

travel agency, which

represents the majority

of our air and rail travel

for 2019.

  

Invesco’s commitment to the natural environment

Operating environmentally responsibly is fundamental to our corporate stewardship. Invesco seeks to help protect our natural environment by implementing and maintaining environmental management processes – for example, at Invesco offices we aim to reduce utility consumption and carbon emissions, promote energy efficiency and utilize appropriate waste management practices.

 

Invesco has a structured program that monitors our environmental impact, gathers ideas and suggestions for improving our global environmental management practices and approves initiatives. Invesco maintains global objectives and regional targets which are monitored to seek to ensure the continual improvement of our impact on the environment. Our commitments and objectives are detailed in our Global Corporate Carbon Emissions and Environmental Policy Statement which is available on the company’s website.

1 As of December 31, 2020

 

 

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LOGO

1

2020 Assessment Report for Invesco Ltd., PRI

 

 

Commitment to inclusion and diversity

Fundamentally, we believe that in order to best help our clients and employees get more out of life, our workforce should reflect the diversity of people and perspectives of the communities we serve. We believe that diversity and inclusion are both moral and business imperatives. At Invesco, we are committed to improving diversity and inclusion across our global business.

Our 4 pillar approach to diversity and inclusion

At Invesco, there are four key components to our diversity and inclusion (“D&I”) strategy, focusing on:

 

1   

Purpose and

priorities

Ensuring D&I is a key part of who we are and how we operate

   2   

Talent

Enhancing diversity and representation by focusing on the recruitment and advancement of diverse colleagues

   3   

Belonging

Ensuring an inclusive culture where all colleagues feel safe and supported

   4   

Client and

community

Moving our industry and our communities forward

We know that success requires the participation of all Invesco colleagues, and these guiding principles allow us to coordinate efforts across the organization, in every region in which we operate.

Purpose and priorities

Ensuring that every Invesco colleagues has a clear role to play in our D&I efforts is critical to our success. This begins at the top, where our CEO and each one of our Senior Managing Directors continue to have diversity and inclusion embedded in their annual performance goals. Executives also lead and sit on our newly formed Diversity & Inclusion Executive Committee, helping to push our agenda further and drive accountability into the organization.

 

From 2017 to 2020,

we have increased

female representation

of senior managers from

26% to 33% globally.

  

Talent

Increasing diverse talent has been a key focus since we formally launched our diversity and inclusion initiatives.

•  We recently set a target of 35% female representation of senior managers, which we seek to achieve by 2022. We were at 33% as of December 2020.

  

•  We have also expanded our development programs, adjusting our Women in Leadership program to a virtual format in a remote working environment, which meant we could double the number of participants.

  

•  We continued our pursuit of reaching our set target of diverse candidate slates and interview panels for new hires.

   Belonging
   While representation of diverse colleagues is a key focus, we know that success goes hand in hand with an inclusive culture. To that end, we have committed to getting all Invesco colleagues through Unconscious Bias training by the end of 2021. In addition, we launched 6 new Business Resource Groups in 2020, bringing our global number to 9. We believe these groups are critical to the success of our culture, allowing employees to build communities and help drive inclusion and engagement at a grassroots level.
 

 

2021 Proxy Statement        27


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Client and community

2020 marked a shift in our diversity and inclusion efforts as we began to cast an eye externally, focusing on how we can drive our communities forward. Be it through the creation of specific products geared toward underrepresented communities, the expansion of our supplier diversity program, or signing pledges like the State of Connecticut Corporate Call to Action, we aim to create more diverse and inclusive communities where we operate. We also work with a variety of external partners with the goal of improving diversity and inclusion both within Invesco and across our industry. For example, we are active members in a number of local or regional public or industry initiatives such as the UK and North America Asset Management Diversity Project, of which Invesco was a founding member.

Measuring success

All of these efforts are sponsored by our CEO and senior managing directors, supported by our senior leaders across the business, cascaded to our employees and captured in the firm’s business plans and leadership objectives. We know the importance of measuring our progress and have expanded our efforts by launching our first ever demographic data capture survey. Launched in October of 2020, all Invesco colleagues are invited to confidentially disclose their demographic data such as race and ethnicity, gender identity, sexual orientation, caregiver status, military service, neurodiversity, and more. We plan to use this data to track the experience of different population groups throughout the organization and seek to ensure equity across all groups at all levels.

We continue to track inclusion through employee surveys. We find a high level of engagement across groups and allow the results of these surveys to drive our inclusion goals and strategy for the year. In 2021, Invesco will continue to conduct “pulse surveys” to monitor, among other factors, our inclusion efforts and employee engagement.

A note on responding to the challenges of 2020

2020 hit our global community with multiple crises and our diversity and inclusion framework and employee networks were critical to our response. From the Covid-19 pandemic, to the racial reckoning in North America, many of our colleagues experienced difficulty operating “business as usual.” Our first priority was, and remains, the health and wellness of our employees, and a wide range of programs were put in place to support the mental wellbeing of our employees and the challenges they faced working remotely. In addition:

 

  We successfully pivoted to a virtual workforce in March of 2020, and remained virtual through year-end in many of our global locations.

 

  We transitioned all of our development programs, including Unconscious Bias training, traditional mentoring programs, reverse mentoring programs, Women in Leadership, and all business resource group events, to a virtual platform. While attrition may have been expected, we are proud to state that all of these programs increased in size as compared to 2019.

 

  We launched a comprehensive action plan to increase racial representation and inclusion, created in coordination with the North America Invesco Black Professionals Network and the D&I Executive Council. Our strategy focuses on broad education for our employee base, increasing representation of minority colleagues through expanded partnerships and metrics-based goals, and partnering with our clients to move our industry forward. In addition, we offered June 19th (“Juneteenth”) as an optional holiday for all US employees; a tradition we will carry forward in 2021 and beyond.

 

  We created and sustained employee matching programs based on community feedback of where employees felt their giving would have the biggest impact.

 

  Our Working Families Network worked in coordination with Invesco Human Resources to provide support to parents trying to juggle remote work, childcare and virtual learning, including encouraging flexible schedules and a reduction of hours.

These examples are a sampling of the intersection between our inclusion work and our ability to respond to employee needs in real time and highlight the criticality of having a strong and agile D&I program at Invesco.

 

 

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Information about the executive officers of the company

In addition to Martin L. Flanagan, whose information is set forth above under Information about Director Nominees, the following is a list of individuals serving as executive officers of the company as of the date of this Proxy Statement. All company executive officers are elected annually by the Board and serve at the discretion of the Board or our Chief Executive Officer.

 

LOGO

 

Kevin M. Carome

Senior Managing Director

and General Counsel

 

Age                 Tenure

64                    18 Years

 

 

Kevin M. Carome

Kevin Carome has served as general counsel of our company since 2006. Previously, he was senior vice president and general counsel of Invesco’s U.S. retail business from 2003 to 2005. Prior to joining Invesco, Mr. Carome worked with Liberty Financial Companies, Inc. (LFC) where he was senior vice president and general counsel from 2000 through 2001. He joined LFC in 1993 as associate general counsel and, from 1998 through 2000, was general counsel of certain of its investment management subsidiaries. Mr. Carome began his career at Ropes & Gray. He is a trustee of the U.S. Powershares ETFs and a director of ICI Mutual Insurance Company, the U.S. investment management industry captive insurer. He earned two degrees, a B.S. in political science and a J.D., from Boston College.

LOGO

 

L. Allison Dukes

Senior Managing Director

and Chief Financial Officer

 

Age                 Tenure

46                    1 Year

 

L. Allison Dukes

Allison Dukes has served as senior managing director and chief financial officer of our company since August 2020. Her current responsibilities include finance, accounting, tax, investor relations, corporate strategy and Invesco’s private markets platform. Prior to joining Invesco, Ms. Dukes served as chief financial officer of SunTrust from February 2018 to December 2019 when SunTrust merged with BB&T Bank to become Truist. As chief financial officer, Ms. Dukes oversaw all corporate finance functions, including corporate development, corporate tax, corporate real estate, strategic planning, investor relations and treasury. Prior to becoming chief financial officer, Ms. Dukes served as head of Commercial & Business Banking for SunTrust from January 2017 to February 2018 which included delivery of SunTrust’s investment banking and capital markets capabilities offered by SunTrust Robinson Humphrey. Prior to her role as head of Commercial & Business Banking, she served as president and chief executive officer of the Atlanta Division of SunTrust from January 2015 to January 2017 and executive vice president and co-head of the Private Wealth Management business from January 2013 until December 2014. Ms. Dukes also currently serves as a director of Haverty Furniture Companies, Inc. She earned a B.S. degree in mathematics from Vanderbilt University and a Master of Business Administration from the Goizueta Business School at Emory University.

 

LOGO

 

Mark Giuliano

Senior Managing Director

and Chief Administrative

Officer

 

Age                 Tenure

59                    5 Years

 

Mark Giuliano

Mark Giuliano has served as a senior managing director since 2019 and has served as chief administrative officer since 2018. Previously he served as Invesco’s Chief Security Officer and Managing Director and Global Head of Security, Technology and Operations from 2016 to 2018. His responsibilities include overseeing Technology, Investment Operations, North America Transfer Agency, Global Security, Global Corporate Services and Invesco Trust Company Departments. Mr. Giuliano joined Invesco in 2016 after serving over 28 years with the Federal Bureau of Investigation (FBI). While at the FBI, Mr. Giuliano served in a number of leadership roles, including Special Agent in charge of the Atlanta division and executive assistant director of the National Security Branch, before retiring as the Deputy Director and Chief Operating Officer. Mr. Giuliano earned a degree in business economics from the College of Wooster.

 

 

2021 Proxy Statement        29


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LOGO

 

Andrew T.S. Lo

Senior Managing Director

and Head of Asia Pacific

 

Age                   Tenure

59                     27 Years

 

  

Andrew T.S. Lo

Andrew T. S. Lo has served as head of Invesco Asia Pacific since 2001. He joined our company as managing director for Invesco Asia in 1994. Mr. Lo began his career as a credit analyst at Chase Manhattan Bank in 1984. He became vice president of the investment management group at Citicorp in 1988 and was managing director of Capital House Asia from 1990 to 1994. Mr. Lo was Chair of the Hong Kong Investment Funds Association from 1996 to 1997 and a member of the Council to the Stock Exchange of Hong Kong and the Advisory Committee to the Securities and Futures Commission in Hong Kong from 1997 to 2001. He earned a B.S. and an MBA from Babson College in Wellesley, Massachusetts.

LOGO

 

Gregory G. McGreevey

Senior Managing Director,

Investments

 

Age                 Tenure

58                    10 Years

  

Gregory G. McGreevey

Greg McGreevey has served as senior managing director, Investments, since 2017, with responsibility for certain of Invesco’s global equity investment teams, equity trading, fixed income, Global Performance and Risk Group and investment administration. Previously, he was chief executive officer of Invesco Fixed Income from 2011 to 2017. Prior to joining Invesco, Mr. McGreevey was president of Hartford Investment Management Co. and executive vice president and chief investment officer of The Hartford Financial Services Group, Inc. from 2008 to 2011. From 1997 to 2008, Mr. McGreevey served as vice chairman and executive vice president of ING Investment Management – Americas Region, as well as business head and chief investment officer for ING’s North American proprietary investments and chief executive officer of ING Institutional Markets. Before joining ING, Mr. McGreevey was president and chief investment officer of Laughlin Asset Management and president and chief operating officer of both Laughlin Educational Services and Laughlin Analytics, Inc. Mr. McGreevey currently serves as a director of Invesco Mortgage Capital Inc. He is a Chartered Financial Analyst. Mr. McGreevey earned a B.B.A. from the University of Portland and an M.B.A. from Portland State University.

 

LOGO

 

Colin D. Meadows

Senior Managing

Director and Head of

Digital Ventures

 

Age                 Tenure

50                    15 Years

  

Colin D. Meadows

Colin Meadows has served as senior managing director and head of Digital Ventures since 2020 overseeing our commercial software and venture capital businesses. Previously, Mr. Meadows served as Head of Invesco Global Institutional and Private Markets from 2015 to 2020 overseeing our global institutional platform and with direct responsibility for our Americas institutional business as well as our real assets and private equity businesses. Previously, he also served as chief administrative officer of Invesco from 2006 to 2018. Mr. Meadows came to Invesco from GE Consumer Finance where he was senior vice president of business development and mergers and acquisitions. Prior to that role, he served as senior vice president of strategic planning and technology at Wells Fargo Bank. From 1996 to 2003, Mr. Meadows was an associate principal with McKinsey & Company, focusing on the financial services and venture capital industries, with an emphasis in the banking and asset management sectors. Mr. Meadows earned a B.A. in economics and English literature from Andrews University and a J.D. from Harvard Law School.

 

 

 

30        Invesco Ltd.


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LOGO

 

Andrew R. Schlossberg

Senior Managing Director

and Head of the Americas

 

Age                     Tenure

47                        20 Years

 

 

  

Andrew R. Schlossberg

Andrew Schlossberg has served as senior managing director and head of the Americas since 2019. In addition, Mr. Schlossberg has responsibility for the firm’s exchange-traded funds capabilities globally and for human resources. Previously, he was senior managing director and head of EMEA (which includes the UK, continental Europe and the Middle East) from 2016 to 2019. Mr. Schlossberg joined Invesco in 2001 and has served in multiple leadership roles across the company, including his previous position as Head of US Retail Distribution and global exchange-traded funds for Invesco. He has also served as U.S. chief marketing officer, head of Global Corporate Development (overseeing business strategy and mergers and acquisitions), and in leadership roles in strategy and product development in the company’s North American Institutional and Retirement divisions. Prior to joining Invesco, Mr. Schlossberg worked with Citigroup Asset Management and its predecessors from 1996 to 2000. He earned a B.S. in finance and international business from the University of Delaware and an M.B.A. from the Kellogg School of Management at Northwestern University.

 

LOGO

 

Doug J. Sharp

Senior Managing Director

and Head of EMEA

 

Age                 Tenure

46                    13 Years

 

  

Doug J. Sharp

Doug Sharp has served as senior managing director and head of EMEA since 2019 and is the Chair of the Board of Invesco UK (Invesco’s European Subsidiary Board). He has 15 years’ experience in the asset management industry. Mr. Sharp joined Invesco in 2008 and has served in multiple leadership roles across the company, including his previous role as the Head of EMEA Retail. Prior to that, he ran Invesco’s Cross Border retail business, as well as serving as the global Head of Strategy and Business Planning and as Chief Administrative Officer for Invesco’s US institutional business. Mr. Sharp joined Invesco from the strategy consulting firm McKinsey & Company, where he served clients in the financial services, energy and logistics sectors. Mr. Sharp earned an M.B.A. from the Tuck School of Business at Dartmouth College, a master’s degree in accounting from Georgia State University and a B.A. in economics from McGill University.

 

Retired executive

 

LOGO

 

Loren M. Starr

formerly Senior Managing

Director and Chief

Financial Officer

 

Age                 Tenure

59                    16 Years

 

  

 

Loren M. Starr

Loren Starr retired from our company on March 1, 2021. Prior to this time, Mr. Starr had served as senior managing director and chief financial officer of our company from 2005 to August 1, 2020 and in an executive advisory role as Vice Chair from August 1, 2020 until his retirement. Prior to joining Invesco, he served from 2001 to 2005 as senior vice president and chief financial officer of Janus Capital Group Inc., after working as head of corporate finance from 1998 to 2001 at Putnam Investments. Prior to these positions, Mr. Starr held senior corporate finance roles with Lehman Brothers and Morgan Stanley & Co. He served as a past Chair of the Association for Financial Professionals and is a member of the board of directors of the Georgia Leadership Institute for School Improvement. Mr. Starr was named one of the best US CFOs by Institutional Investor magazine. He earned a B.A. in chemistry and B.S. in industrial engineering from Columbia University, as well as an M.B.A. from Columbia and an M.S. in operations research from Carnegie Mellon University.

.

 

 

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Executive compensation

 

 

Compensation discussion and analysis

Invesco’s executive compensation program is designed to align executive compensation with the long-term interests of our shareholders. This Compensation Discussion and Analysis (“CD&A”) provides shareholders with information about our business, 2020 performance, our disciplined approach to compensation and 2020 compensation decisions for our Named Executive Officers (“NEOs”) listed below. We refer to certain Non-GAAP measures throughout this section that are used in compensation decisions. Please refer to Appendix A of this Proxy Statement for information regarding these measures.

 

LOGO

  

LOGO

  

LOGO

  

LOGO

  

LOGO

  

LOGO

Martin L. Flanagan    L. Allison Dukes1    Andrew T.S. Lo   

Gregory G.

McGreevey

Senior Managing Director,

Investments

  

Andrew R.

Schlossberg

Senior Managing Director and

Head of the

Americas

   Loren M. Starr2

President and Chief

Executive Officer

(“CEO”)

   Senior Managing Director and Chief Financial Officer (“CFO”)   

Senior Managing Director and Head

of Asia Pacific

  

Retired Vice Chair, Former Senior Managing Director and Chief

Financial Officer

 

1

Ms. Dukes was appointed Senior Managing Director and Chief Financial Officer effective August 1, 2020.

2

Mr. Starr transitioned from his role as Senior Managing Director and Chief Financial Officer to an executive advisory role of Vice Chair effective August 1, 2020. He served as Vice Chair until his retirement from the company on March 1, 2021.

Contents

 

Executive summary    33  
 

LOGO

  

Introduction

     36  
 
   Invesco shareholder value framework      36  
   Shareholder and proxy advisory engagement and feedback      36  
 

LOGO

  

Our compensation framework

     39  
 
   How the committee uses its judgment in making incentive compensation decisions      39  
   Invesco 2020 performance      41  
   Company scorecard results for 2020 – aligning pay with results      41  
   2020 NEO total annual compensation summary – aligning pay to results      43  
   NEO variable pay is at risk      44  
 

LOGO

  

NEO pay outcomes and performance summaries

     45  
 
   We link pay and performance      45  
   CEO pay is aligned to financial performance      46  
   Other NEO pay and performance      47  
 

LOGO

   The committee’s process for determining executive compensation      52  
 
       

LOGO

  

Our compensation components

     54  

LOGO

  

Our compensation philosophy and objectives

     55  
   Compensation philosophy      55  
   Performance-based equity awards      55  
   Market data      57  

LOGO

  

Our compensation policies and practices

     58  
   Summary of executive compensation practices      58  
   Stock ownership policy      58  
   Hedging policy      58  
   Clawback policy      58  
   Benefits      59  
   Perquisites      59  
   Tax reimbursements      59  
   Tax deductibility of compensation      59  
   Employment agreements      59  
   Potential payments upon termination or change in control      60  
 
 

 

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 Executive summary

Pay for 2020 is aligned with performance, reflecting a year of challenged financial performance due to the COVID-19 pandemic, a challenging industry environment and only partially achieving our 2020 goals, offset by management’s response to COVID-19 for our employees and clients and, later in the year, the return of positive flows and improved investment performance.

         

          

2020 Financial performance (year-over-year change)1

 

                  
Adjusted     Adjusted     Adjusted     Ending  
operating income2        operating margin2        diluted EPS2        AUM           
$1.7 billion     37.0%     $1.93     $1.35T  
(+0.5%)     (-0.5 percentage point)     (-24%)     (+10%)  
                  

More information regarding select financial performance highlights is located on page 41.

    The impact of the COVID-19 pandemic, investment performance challenges in some of our active equity and alternative strategies and disappointing flows in our retail channel hindered our ability to achieve our 2020 goals. We were disappointed that we were unable to grow revenue and adjusted operating income when adjusted for the additional five months of Oppenheimer financials included in 2020 versus 2019.  
    The compensation committee viewed the year holistically and considered management’s response to COVID-19 for our employees and clients, the plan to reduce adjusted operating expenses by $200 million, actions to improve underperforming active equity funds and reduce complexity of cross-functional activities and, later in the year, return of positive flows and improving investment performance.  
    The compensation committee did not change the goals or targets set early in 2020.  

 

Total CEO pay decreased

 

    

93%

 

    

60%

 

          

9.4%

 

      

of CEO’s 2020

pay is variable

      

of CEO’s 2020 equity is

performance-based

   
from 2019      

 

  Invesco’s responsiveness in 2020

     Progress on corporate strategy            

  Prioritized the health and wellbeing of our

    

  Continued to offer our clients diverse solutions to

  

employees

    

ensure they can remain resilient

  

  Successfully pivoted to a work from home

    

  Expanded our digital wealth solutions

  

environment

    

  Executed a strategic restructuring to enhance

  

  Leveraged more extensive digital engagement

    

efficiencies and promote future growth

  

with our clients

    

  Strengthened our balance sheet by paying down

  

  Our board and senior management met informally

    

our credit facility to zero at December 31, 2020

  

on a weekly basis during the initial phase of the

    

  Focused on delivering exceptional investment

  

pandemic

    

performance by promoting a strong investment

  

  Launched comprehensive action plan to increase

    

culture and changing underperforming strategies

  

racial representation and inclusion. Recognized

    

  Added depth and experience to our board through

  

Juneteenth as optional US holiday

    

the addition of three new directors

  

 

  Company scorecard links performance to pay

     We have sound compensation practices            

  Continued to use a company scorecard to assess

    

  Pay practices align with shareholder interests

  

company performance on a quantitative basis

    

  93% of our CEO pay is variable and 84 - 92% of our

  

  Based on shareholder feedback, our 2020

    

other NEO pay is variable

  

company scorecard reflects fewer and more

    

  Annual review of metrics to ensure drivers are

  

focused metrics as well as an easy to follow

    

meaningful for creating shareholder value

  

illustration to better understand pay decisions

    

  In 2021, we will further refine our compensation

  

  Throughout the year, our compensation

    

design, process and scorecard by focusing on

  

committee assessed performance against our

    

the most relevant metrics and providing more

  

goals and peer performance

    

transparency on the financial goals and actual

  
    

scorecard results

  

 

  1

Financial results for 2019 include approximately 7 months of OppenheimerFunds financial results compared to 2020, which include 12 months of OppenheimerFunds financial results.

 
  2

Adjusted financial measures are all non-GAAP financial measures. See the information in Appendix A regarding Non-GAAP financial measures.

 
 

 

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More about 2020, our responsiveness and executive pay

Covid-19 pandemic — compensation decisions

The pandemic and its ongoing effects have, not surprisingly, raised extraordinary compensation issues unlike any in our history. This is particularly true for the incentive compensation framework put in place before the pandemic and that has been severely impacted in ways that could not have been contemplated.

Throughout the pandemic, the committee regularly discussed how best to balance and fairly recognize management’s achievements to successfully navigate the pandemic, while recognizing the adverse impact on our shareholders and employees. During this unprecedented year, the committee noted our executives’ responsiveness – the executive team focused on what they could control – announcing a plan to reduce adjusted operating expenses by $200 million, initiating actions to improve underperforming equity funds, focusing on client interactions in a more digital way and supporting our global employees.

The committee’s assessment of company performance and individual achievements determine NEO compensation. The committee believes that our scorecard performance measures provide a key indicator of our performance. At the onset of 2020, having completed the integration of OppenheimerFunds, we set an aggressive plan for growth. As 2020 unfolded, the committee recognized that the effect of the pandemic on investor preferences, performance challenges in some of our active equity and alternative strategies and disappointing flows in our retail channel would hinder our ability to achieve all of our 2020 goals. Despite the impact of the pandemic, the committee did not change our executive officers goals or targets set at the beginning of the year.

 

  Considerations        Approach

As 2020 unfolded, the committee viewed the year holistically including:

    

The committee agreed on the following general philosophies in making decisions about the pandemic-impact on our executives’ compensation

  The committee did not change goals or targets set at the beginning of the year

  No changes on outstanding performance-based equity awards; no substitute awards

  The retention and continued motivation of executives and senior staff is of paramount importance, given the skills needed to meet the continuing challenges of the pandemic and the changing asset management industry

  how the executive management team responded to COVID-19 for employees and clients in the short and long-term

 

  how the executive management team focused on what they could control

 

–  announcing our strategic evaluation that will reduce adjusted operating expenses by a net $200 million by the end of 2022

–  reducing the complexity of cross functional activities

 

–  addressing performance issues in our active equity complex

 

–  strengthening our ESG efforts

    

•  the improvement in investment performance during the second half of the year

    

•  the adverse impact of the pandemic on our shareholders, including the board’s decision to reduced our dividend rate to preserve cash, our net outflows during the first half of the year, and our volatile stock price

    

 

    

 

 

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98%

of our employees say Invesco prioritized

their health and safety

 

 

How we supported our employees

•   Our top priority in 2020 was the health and wellbeing of our employees. We provided online resources for our employees to provide timely information and support.

 

•   At the onset of the pandemic, we seamlessly pivoted the vast majority of our workforce to a work from home environment with remote support allowing us to continue to serve clients and meet our regulatory obligations.

 

•   We conducted regular check-in surveys to understand the general wellbeing of our employees, their ability to perform their job and any work from home obstacles. These surveys provided critical insights about what aspects of our pandemic response have been effective in identifying concerns.

 

•   To stay in touch with our global employee base, we dramatically increased our employee communications including videos with senior management to provide updates on our business and to maintain a connection with our employees.

 

•   We created a global Return to Office task force that is charged with ensuring the safety of our global office locations. The task force is also charged with developing a framework of specific conditions necessary to enable a safe return to the office. The framework will be guided by science and the advice of our health authorities, best practices developed by businesses and compliance with applicable governmental restrictions and requirements.

 

 

Throughout this CD&A, we discuss our compensation program, compensation decisions and changes to our executive compensation program. We believe that the enhancements summarized below deliver meaningful improvements to our executive compensation program.

 

 

 

Summary of 2020 enhancements to our executive compensation program

 

•   Improved company scorecard. The company scorecard includes fewer and more focused goals. See page 42 for the company scorecard results.

 

•   CEO compensation cap. CEO cash bonus is capped at the lesser of $10 million or 30% of the CEO’s incentive pay.

 

•   Performance-based equity awards. 60% of equity awards are performance-based.

 

•   Updated peer groups. We implemented a new peer group for our 2020 performance-based awards. We also implemented a new compensation peer group for 2021. These peer groups emphasize pure asset management firms with significant business overlap and similar scale. See page 57 for a discussion about our updated peer groups.

 

•   Updated vesting matrix. We established an updated vesting matrix for our performance-based equity awards that more closely ties to the firm’s operating plan. See page 56 for our updated vesting matrix.

 

    

 

 

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LOGO Introduction

 

 

Invesco shareholder value framework

Invesco is committed to serving our clients and delivering long-term shareholder value. Our executives are able to directly influence key business drivers that create long-term shareholder value, recognizing that our financial results can be significantly impacted by movements in the global capital markets that are beyond our control. Invesco’s framework for long-term shareholder value creation is based primarily on:

 

LOGO   

Our focus on delivering the outcomes our clients seek enables us to grow our business by attracting and retaining new assets under management (“AUM”), resulting in positive long-term organic growth.

 

Our strong global operating platform allows us to operate effectively and efficiently and is an important driver of our operating leverage that benefits clients and shareholders. The creation of operating leverage allows us to meet current client demands, invest for future growth and create value for our shareholders.

 

We strive to maintain our financial strength through disciplined capital management and return capital to shareholders on a consistent and predictable basis.

 

Our focus on driving greater efficiency and effectiveness, combined with our work to build a global business with a comprehensive range of capabilities, puts Invesco in a strong position to meet client needs, run a disciplined business, continue to invest in and grow our business over the long term, and deliver long-term value to our clients, shareholders and other stakeholders.

 

Invesco’s commitment to delivering shareholder value is aligned with the purpose-driven way we manage our business. To meet the needs of our clients, we focus on:

  delivering strong, long-term investment performance; and
  providing a comprehensive range of investment capabilities and technology solutions seeking to ensure deep and stable investment teams.

Investing for the long-term is an important element of our strategy. Our diversified investment capabilities in terms of investment objectives, styles, client types, and geographies enable us to meet client needs through differing market cycles across the globe. We also strive to give clients greater value for their money, which means competitively priced products, as well as investor education, thought leadership, digital platforms and other “value adds” that create an enhanced client experience.

 

In 2020, we contacted

our top 30 shareholders, representing

 

74%

of our outstanding shares

  

 

Shareholder and proxy advisory engagement and feedback

The Annual General Meeting of Shareholders provides our shareholders with the opportunity to:

  evaluate our executive compensation philosophy, policies and practices;

  assess the alignment of executive compensation with Invesco’s results; and

  cast an advisory vote to approve the company’s executive compensation.

  

 

At the 2020 Annual General Meeting of Shareholders, 68% of shareholder votes were cast in favor of our Say-on-Pay advisory vote (a significant decrease from 93% of votes cast in favor in 2019).

  

 

Invesco’s board understands the importance of executive compensation decisions and encourages open and constructive dialogue with our shareholders. Each year, Invesco engages with key shareholders and major proxy advisory firms to solicit insights on executive compensation and governance matters.

 

 

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In the Fall of 2020, we invited our top 30 shareholders representing 74% of our outstanding shares1 to engage with us regarding, among other topics, our executive compensation program. We held meetings with all shareholders who accepted our invitation – nine of our shareholders representing 24% of our outstanding shares1, including shareholders who voted against our Say-on-Pay proposal in 2020. We also met with major proxy advisory firms. Our board chair and compensation committee chair attended meetings with our top institutional shareholders and the major proxy advisory firms to provide the board’s perspective and gain insights. During these meetings, we asked specific questions about the design of our current executive compensation program and gave our meeting attendees the opportunity to provide feedback. Both the participating directors and management provided feedback to the committee based on these meetings.

MassMutual, our largest shareholder, received updates to our compensation program and governance in lieu of a meeting. Trian Fund Management, L.P. (“Trian”) owns approximately 9.9% our outstanding common shares. In November 2020, Messrs. Garden and Peltz (each representing Trian) joined our board. Messrs. Garden and Peltz have an impressive track record as long-term investors, and their prior experience in asset management gives them a deep understanding of the significant growth opportunities of this industry. We are pleased to have Trian as a significant shareholder. We welcomed these new directors to the board and are working closely with them as board members (and a member of the compensation committee in the case of Mr. Garden) to further strengthen our business and achieve the potential of our global firm.

The table below shows key topics or themes that were raised during our Fall outreach and actions taken or proposed to be taken in response. The committee, in conjunction with its independent consultant and senior management, integrated aspects of the feedback into our compensation program.

 

 

Recap of 2020 outreach feedback and actions

 

Topics and themes    Invesco’s response

Invesco’s response to 2020

•   We would like to know what actions you took in response to the unprecedented events this year.

•   Did the events of 2020 impact your pay decisions?

  

•   Prioritized the health and wellbeing of our employees

•   Did not modify or change goals or targets set at the beginning of the year

•   Leveraged full digital engagement with our clients

•   Reduced dividend rate to preserve cash

•   The committee viewed the year holistically when making pay decisions.

Improved transparency around decision making

•   We would like to see greater transparency and insight into the reasons for your decisions and actions.

•   We would like to see an example of how CEO pay was determined.

  

•   Included more disclosure on how the committee arrived at final pay outcomes

•   Included an illustration that shows how the results of the company scorecard and CEO achievements were used to determine CEO pay

Company scorecard

•   We think that the scorecard has too many measures

•   We would like for the scorecard to have a better line of sight to pay decisions.

•   We would like to know if you adjusted any of your scorecard targets during the year.

•   We would like more information about the rating system for the scorecard.

  

•   For 2020, we added disclosure regarding the percentage score for each performance category on the company scorecard as well as a scoring legend.

•   For 2020, we added disclosure about the importance of key scorecard metrics. Despite the impact of the pandemic on our ability to achieve all of our 2020 goals, we did not change goals or targets set at the beginning of the year.

•   For 2021, we will further reduce the number of company scorecard metrics and update the weightings of the categories to increase the impact of financial factors.

•   For 2021, we will add metrics related to long-term net flows.

Executive compensation tables

•   We would like to see additional disclosure in the executive compensation tables in order to gain insight into the vesting of performance-based awards.

  

•   For our 2021 proxy, the awards vested table now includes

information about the percent of award vesting during the year on a grant-by-grant basis.

Performance-based awards

•   We believe at least 50% of awards should be performance-based.

  

•   For awards granted in 2021, 60% of total equity awards for

executives is performance-based (an increase from current level of 50%)

  

•   For 2021, the vesting matrix for our performance-based awards will be more closely tied to the firm’s operating plan

Equity plan share replenishment

•   We want to know the reason for share replenishment.

•   Provide projected overhang

  

•   Proposal 3 provides information about why we are seeking

approval to replenish our equity plan as well as projected

overhang data.

 

1 As of October 1, 2020

  
 

 

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LOGO

  Board involvement
  In 2020, our board chair and compensation committee chair participated in certain shareholder and proxy advisor meetings to provide the board’s perspective and gain insights. Both the participating directors and management provided feedback to our compensation committee based on such meetings.
LOGO  

Evolution of our executive compensation program

The below timeline demonstrates Invesco’s continued responsiveness to shareholder feedback and the progression of our compensation program over the past several years.

 

LOGO

 

 

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LOGO   Our compensation framework

 

We achieve alignment    How we align performance and pay
of performance and pay by measuring company performance and individual achievements    Executive pay outcomes are aligned to both our company performance and individual achievements. At the beginning of the year, the committee approves the CEO objectives, the company scorecard and its weightings that measure the following key drivers of shareholder value creation:

 

LOGO   

LOGO   our financial performance

   50%
  

LOGO   meeting client needs with the quality and breadth of investment capabilities that achieve strong medium- and long-term investment performance

  

 

30%

  

 

LOGO   sustaining a high performing organization, since our people are the source of everything we do

  

 

20%

     
Following completion of the year, the committee’s assessment of the company’s performance and individual achievements determines each NEO’s annual and long-term incentives.

 

The committee uses judgment as we believe that a wholly formulaic program could have unintended consequences   

 

How the committee uses its judgment in making incentive compensation decisions

The committee uses financial and other metrics in the company scorecard to evaluate firm performance. Our business is dynamic and requires us to respond rapidly to changes in market conditions and other factors outside of our control that impact our financial performance, such as the COVID-19 pandemic in 2020.

 

The committee believes that applying structured judgment and thoughtful consideration of an executive’s qualitative performance is a critical feature of our executive compensation program.

 

The committee believes that a rigid, formulaic program based strictly on quantitative metrics could have unintended consequences such as encouraging undue focus on achieving specific short-term results, at the expense of long-term success. In addition, solely formulaic compensation would not permit adjustments based on factors beyond the control of our executives as well as relative performance in relation to shifting market conditions and less quantifiable factors such as recognition of strategic developments and individual achievements. Therefore, thoughtful consideration of these additional factors allows the committee to fully consider the overall performance of our executives over time and has been a key ingredient in ensuring our long-term financial results.

 

 

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For all NEOs, at least 60% of their total incentive award is delivered through deferred equity. All incentives are paid from a company-wide incentive pool.   

The committee’s well-defined process for making pay decisions

The pay determination process reinforces our shareholder value framework. The committee’s 4-step process determines each NEO’s total incentive outcome, which includes all variable pay (annual cash award + annual stock deferral award + long-term equity awards). Based on quantitative and qualitative performance assessment, total incentive awards can range from 0% to 130% of each NEO’s incentive target. Once the total incentive award is determined, the pay mix between cash, deferred equity and long-term equity is more heavily weighted to equity awards. See page 44 for the overall pay mix for the NEOs.

 

See pages 52 through 53 for a detailed description regarding these steps

   LOGO

The table below shows NEO incentive targets for 2020. With the exception of Ms. Dukes who joined Invesco in 2020, there were no changes from 2019 targets.

 

2020 NEO incentive targets        
     2020 Incentive target  
Name    (in millions)1  

Martin L. Flanagan

     $13.50  

L. Allison Dukes2

     $3.00  

Loren M. Starr

     $3.15  

Andrew T.S. Lo

     $4.14  

Gregory M. McGreevey

     $5.80  

Andrew R. Schlossberg

     $4.55  

1 Incentive compensation includes bonus and short-term deferral and long-term equity.

2 Ms. Duke’s 2020 incentive target was prorated to reflect her tenure in her current role.

 

 

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Invesco 2020 performance

The asset management industry is continuing to undergo rapid change. In 2020, the first part of the year was consumed with responding to the COVID-19 pandemic. Invesco pivoted quickly to a work from home platform with little interruption to our employees or clients. We encountered challenges in the first half of 2020 in connection with the COVID-induced market uncertainty. The investments we had made in the business in the years leading up to 2020 allowed us to weather the initial phase of the pandemic and to emerge stronger in the second half of the year. We continued to focus on operational efficiency, evolving our business and making investments in key growth areas.

Below are performance highlights. Many of these metrics are also included in our company scorecard that we use to determine 2020 executive pay.

 

 

Year-end assets under
management ($B)

 

 

Net revenue1 ($M)

 

 

Adjusted net income1,2 ($M)

 

 

Adjusted diluted earnings

per share1,2 ($)

LOGO

  LOGO   LOGO  

LOGO

 

Adjusted operating income1,2

($M)

 

 

Adjusted operating margin1,2

(%)

 

 

Cash dividend per common

share ($)

 

 

Total return of capital ($M)

LOGO

  LOGO   LOGO   LOGO

 

During the first half of 2020, we experienced meaningful net outflows and redemptions rates.

 

During the second half of 2020, we saw marked improvements to our share price, our investment performance and inflows.

  

 

Company scorecard results for 2020 – aligning pay with results

In early 2021, using the company scorecard, the committee conducted its final quantitative assessment of company performance for 2020.

 

For 2020, the committee did not change the goals or targets set at the beginning of the year, despite the pandemic-related challenges experienced earlier in the year. For example, in the financial performance category, scoring was negatively impacted by our board’s decision in April to cut our dividend rate to preserve cash. Our clients’ reactions to the pandemic negatively impacted our stock price which, in turn, negatively impacted our relative TSR ranking. In the Delivering to Clients category, we experienced significant net outflows. During the second half of 2020, we saw marked improvements in items such as paying our credit facility to zero and increases in our share price, and net long-term inflows.

 

 

 

 

1

Financial results for 2019 include approximately 7 months of OppenheimerFunds financial results compared to 2020, which include 12 months of OppenheimerFunds financial results.

2

The adjusted financial measures are all non-GAAP financial measures. See the information in Appendix A of this Proxy Statement regarding Non-GAAP financial measures.

 

 

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The outcomes for our 2020 company scorecard are described below with an overall company score of 72% - targets partially achieved.

 

         

 

2020 Scorecard

         

Category

weighting factor

   Measures included        

2020

Performance

     

 

     

Financial performance

 

LOGO

  

•  Adjusted earnings per share (diluted EPS)

•  Adjusted operating income

•  Leverage ratio (adjusted debt/EBITDA)1

•  Adjusted operating margin

•  Operating expense per average AUM

  

•  Dividend growth

•  Cumulative capital returned to shareholders (5-year period)

•  Total shareholder return vs. total returns of S&P 500 and our peer group (top half of peer group)

  

66% - targets

partially

achieved

  
  
  
  
  
  
  
  
              

 

  

 

Assessment/Total incentive percentage range   

Delivering to clients

LOGO

 

  

•  Sustain responsible investment and corporate stewardship commitment (PRI rating)

•  Quality and breadth of mature investment capabilities (share of investment strategies with leading marketability scores)

  

•  60% of actively managed assets in top half of peer group over 3- & 5- year period

•  Organic Growth2

•  Absolute growth flows

•  Absolute net flows

•  Redemption rate

  

63% - targets

partially

achieved

 

Exceptional

target

achievement

   126% - 130%

 

Targets

exceeded

   111% - 125%

 

Targets achieved    85% - 110%

 

  

 

Targets partially achieved    50% - 84%    Organizational strength   

•  Leadership effectiveness

–  Foster and build a diverse and inclusive culture

–  Sustainable employee engagement scores

  

•  Employee retention (employee turnover rate)

  

99% - targets

achieved

 

  
Targets not achieved    0% - 49%    LOGO

 

  
  
  
  
  
        
        
              
              
              
     

 

      Overall weighted rating of performance outcomes      

72% - targets

partially

achieved

     

 

              

The committee and its compensation consultant engaged in discussions throughout the year about the evolving impact of the COVID-19 pandemic, including the impact on our scorecard, our pay practices and related pay outcomes. The committee acknowledged they had higher aspirations for 2020 and engaged in lengthy discussions about what measures management had direct control over and those that management did not have direct control over (for example, management cannot control the market or the reactions of our clients to the pandemic).

The committee believes that the scorecard is a good indicator of overall health of the firm. In this context, the committee used the company scorecard to assess 2020 outcomes versus proposed goals and used its structured discretion to assess individual executive achievements.

1 Amounts exclude the outstanding preferred shares

2 Based on average long-term assets and flows

 

 

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2020 NEO total annual compensation summary – aligning pay to results

CEO pay determination

 

LOGO

Our CEO’s 2020 incentive compensation is aligned with the company’s performance for the year. In determining Mr. Flanagan’s compensation, the committee took into consideration the challenged financial performance of the company due to the COVID-19 pandemic, a challenging industry environment, and the company’s scorecard results of only partially achieving its 2020 goals. These factors were offset by the company’s response to the pandemic for its employees and clients and, later in the year, the return of positive flows and improved investment performance. As a result, the committee determined that Mr. Flanagan’s incentive compensation would be $10.31 million, which is 76.4% of his 2020 incentive target and represents a decrease of 10% in total incentive pay compared to 2019.

Pages 45 and 46 under the heading 2020 Key achievements further describe Mr. Flanagan’s achievements of this past year, as well as the outcomes of several metrics included in the company scorecard.

Illustration. Based on company performance and Mr. Flanagan’s performance, the below illustration shows how the committee calculated Mr. Flanagan’s pay in respect of 2020. The committee’s process for determining executive officer pay is applied to all incentive compensation (consisting of cash bonus + annual stock deferral + long-term equity).

 

  

Step 1 – Quantitative assessment of company performance

 

   2020 incentive target      $13.50M  
  

 

 
   Quantitative score from scorecard      72%  
  

 

 
   2020 incentive target, as adjusted      $9.72M  
  

 

 
  

Step 2 – Qualitative assessment of executive achievements

 

Payout range = 50% to 84% of incentive range    Committee considered multiple considerations from the year including:

 

  

  Leadership during the COVID-19 pandemic and actions on social injustice and diversity and inclusion discussed in Mr. Flanagan’s key achievements below

   

       

    Strategic engagement with clients during the pandemic

    The return of positive flows and improved investment performance in the later part of the year

  

 

 
   Committee application of modifier for 2020 achievements      +$0.59M  
  

 

 
   Total incentive      $10.31M  
  

 

 
   Percent of target      76.4%  
  

 

 

NEO pay determinations. Given the company’s performance in 2020, our CEO recommended to the committee, and the committee agreed, to reduce the other NEOs’ incentive compensation for 2020 by 10%, with one exception, based on strong regional performance. The exception is Andrew Lo, our executive overseeing the Asia-Pacific region, whose incentive compensation was flat year-over-year and was 104.8% of his 2020 incentive compensation target given the significant increase in growth in the region, in particular China.

The tables below show compensation decisions for each of the NEOs for 2020, including incentive pay as a percentage of their respective incentive compensation targets. Incentive compensation for the CEO and the other NEOs may range from 0% to 130% of each executive’s target.

 

 

2020 NEO total incentives earned relative to target

 

LOGO

 

 

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2020 NEO total compensation

 

Name   

Base

salary ($)

    

Cash

bonus ($)

    

Stock

deferral ($)

    

Long-term

equity ($)

    

Total

compensation

($)

    

YOY %

change

     Performance-
based ($)1
 

Martin L. Flanagan

     790,000        3,093,000        1,546,500        5,670,500        11,100,000        -9.4%        4,330,200  

L. Allison Dukes

     500,000        900,000        675,000        1,125,000        3,200,000        N/A        1,080,000  

Loren M. Starr

     450,000        848,160        369,210        1,476,900        3,144,270        -2.7%        1,107,666  

Andrew T.S. Lo

     462,398        1,400,000        541,930        2,400,000        4,804,328        0.0%        1,765,158  

Gregory M. McGreevey

     450,000        1,890,000        990,000        2,160,000        5,490,000        -9.3%        1,890,000  

Andrew R. Schlossberg

     450,000        1,638,000        1,228,500        1,228,500        4,545,000        -9.1%        1,474,200  

1 Represents 60% of the combined value of the stock deferral and long-term equity awards

Caps

For the CEO, annual total compensation is capped at $25 million. New for 2020 pay, the CEO annual cash bonus is capped at the lesser of $10 million or 30% of incentive pay.

For executives (other than the CEO), annual cash bonuses are capped at 50% of total pay.

Performance-based incentives

New for 2020 pay, 60% of the combined value of the annual stock deferral and long-term incentive awards is performance-based (an increase from 50%). Vesting of performance-based awards continues to be tied to adjusted operating margin over a three-year period and three-year average of TSR of the company. See Performance-based equity awards on pages 55 - 56 for additional details.

 

 

NEO variable pay is at risk

Our compensation structure reflects our commitment to pay for performance. As noted below, 84 - 93% of our NEO compensation is variable. Compensation mix percentages reflect compensation decisions by the committee for 2020.

Cash bonus, annual stock deferral and long-term equity awards were earned in 2020 and paid/granted in 2021. In accordance with SEC requirements, the Summary Compensation Table on page 61 reports equity in the year granted, but cash in the year earned. The Summary Compensation Table reports “All Other Compensation,” which is not part of the committee’s compensation determinations.

 

 

2020 CEO total annual compensation — $11.1M

 

LOGO

 

 

2020 NEO total annual compensation (excluding CEO)

 

LOGO

 

 

44        Invesco Ltd.


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LOGO    NEO pay outcomes and performance summaries

 

 

We link pay and performance

Below is a summary of 2020 NEO compensation and material accomplishments the committee considered when determining compensation for 2020.

 

 

LOGO

 

Martin L. Flanagan

President and CEO

     

2020 Compensation

(in 000s)

 

     

Responsibilities

Mr. Flanagan is President and CEO. He develops, guides and oversees execution of Invesco’s long-term strategic priorities to deliver value for clients and shareholders over the long-term.

 

Mr. Flanagan is responsible for senior leadership development and succession planning, defining and reinforcing Invesco’s purpose and engaging with key clients, industry leaders, regulators and policy makers.

  

 

 
   Base salary      $790  
  

 

 
   Annual incentive award – Cash      $3,093  
  

 

 
   Annual incentive award – Stock deferral      $1,547  
  

 

 
   Long-term equity award      $5,671  
  

 

 
   Total annual compensation      $11,100  
     
     
  

 

 
   Total incentive compensation      $10,310  
  

 

 
   2020 incentive target      $13,500  
  

 

 
  

Total incentive compensation as

a % of 2020 incentive target

     76.4%  

 

 

For 2020, the committee decided that Mr. Flanagan’s total incentive compensation should be $10.31 million, which is 76.4% of his 2020 incentive target of $13.5 million. Mr. Flanagan’s total compensation is down 9.4% from 2019. As noted above, the company’s process for determining executive officer pay is applied to all incentive compensation (consisting of cash bonus + annual stock deferral + long-term equity).

 

 

LOGO   

 

2020 Key achievements

•  Mr. Flanagan led the firm’s efforts to continue executing on its long-term strategy while supporting our employees, finding new ways of working, and serving and delivering expected client outcomes.

•  Mr. Flanagan navigated the firm through an unprecedented market backdrop in the first half of the year. Under Mr. Flanagan’s leadership, the firm achieved record AUM of $1,350 billion at the end of 2020 and record gross long-term inflows of $91.6 billion during the fourth quarter.

•  Mr. Flanagan oversaw a comprehensive strategic evaluation of our business with several objectives, including enhancing client outcomes, improving organic growth, reducing complexity of cross-functional activities and streamlining the firm’s operating environment. We expect this optimization will allow continued investment in the business while reducing adjusted operating expenses by a net $200 million by the end of 2022. We realized $30 million in annualized savings in the fourth quarter.

•  Invesco continued to invest in its leadership position in Greater China, the world’s fastest-growing market, where we have been managing Chinese investments for nearly four decades. Invesco now ranks #1 among onshore providers in China1, building on a legacy of success in the broader Asia-Pacific region.

•  Invesco’s ETF business is the fourth largest in the world.2 During the fourth quarter of 2020, Invesco’s ETFs experienced total net inflows of $6.1 billion globally.

•  Mr. Flanagan and Invesco remain firmly committed to further strengthening Invesco’s Environmental, Sustainability and Governance (ESG) efforts. Invesco was awarded an A+ rating for its overall approach to responsible investment (strategy and governance) for the fourth consecutive year as well as achieving an A or A+ across all categories by the PRI (Principles for Responsible Investment).

•  Mr. Flanagan led a public call to action on social injustice by community leaders in the firm’s headquarters city, Atlanta, Georgia, and meaningfully strengthened the firm’s own Diversity and Inclusion efforts.

1 Z-Ben Advisors, April 2020

2 Invesco ETFs Strategy and Research as of December 31, 2020.

 

 

2021 Proxy Statement        45


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Our compensation committee has demonstrated over multiple years that our CEO’s compensation is aligned with the company’s financial performance   

 

CEO pay is aligned to financial performance

The below charts demonstrate that over the last five years the committee has ensured that the CEO’s compensation has aligned closely with the financial outcomes of the firm.

     
  

 

  

5-year Invesco CEO pay versus financial performance

 

   LOGO

 

           
      2016      2017      2018      20193      20203  

LOGO   CEO compensation ($mil)

     13.5        13.8        11.0        12.30        11.1  

 

 

LOGO   Adjusted operating income2 ($mil)

     1,297        1,482        1,392        1,656        1,665  

 

 

LOGO   Adjusted operating margin2 (%)

     38.2        39.5        36.5        37.5        37.0  

 

 

LOGO   Adjusted diluted EPS2 ($)

     2.23        2.70        2.43        2.55        1.93  

 

 

 

  1

Consists of salary, annual cash bonus, annual stock deferral award and long-term equity award . For 2018 and 2019, 50% of the combined value of the annual stock deferral and long-term equity awards is performance based . For 2020, 60% of the combined value of the annual stock deferral and long-term equity awards is performance-based. See note on page 44 regarding differences from the summary compensation table.

  2

The adjusted financial measures are all non-GAAP financial measures. See the information in Appendix A of this Proxy Statement regarding Non-GAAP financial measures.

  3

Financial results for 2019 include approximately 7 months of OppenheimerFunds financial results compared to 2020, which include 12 months of OppenheimerFunds financial results

The table below shows the year-over-year change in adjusted operating income, adjusted operating margin and CEO compensation:

 

                     
     2016             2017             2018             20193             20203         
                     

Adjusted operating income1

     -13%        LOGO        +14%        LOGO        -6%        LOGO        +19%        LOGO        +0.5%        LOGO  
                     

Adjusted operating margin1

     -6%        LOGO        +3%        LOGO        -8%        LOGO        +1%        LOGO        -1%        LOGO  
                     

CEO total incentive compensation2

     -11%        LOGO        +3%        LOGO        -21%        LOGO        +12%        LOGO        -10%        LOGO  

 

1

The adjusted financial measures are all non-GAAP financial measures. See the information in Appendix B of this Proxy Statement regarding Non-GAAP financial measures.

2

Consists of annual cash bonuses, annual stock deferral awards and long-term equity awards.

3

Financial results for 2019 include approximately 7 months of OppenheimerFunds financial results compared to 2020, which include 12 months of OppenheimerFunds financial results.

 

 

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Other NEO pay and performance

 

 

 

LOGO

 

L. Allison Dukes

Senior Managing

Director and Chief             Financial Officer

 

 

2020 Compensation

(in 000s)

 

     

 

Responsibilities

Ms. Dukes serves as Senior Managing Director and Chief Financial Officer.

 

Ms. Dukes is responsible for planning, implementing, managing and controlling all corporate financial-related activities of the firm, including forecasting, strategic planning, capital allocations and expense management. She also oversees corporate finance, accounting, investor relations and corporate strategy.

 

 

  Base salary    $500
 

 

  Annual incentive award – Cash    $900
 

 

  Annual incentive award – Stock deferral    $675
 

 

  Long-term equity award    $1,125
 

 

 

Total annual compensation

 

  

$3,200

 

 

 

  Total incentive compensation    $2,700
 

 

  2020 incentive target    $3,000
 

 

  Total incentive compensation as a % of 2020 incentive target    90.0%

 

 

Based on the quantitative outcome of Invesco’s performance and a qualitative review of Ms. Dukes’ individual performance, the committee determined that Ms. Dukes’ total incentive compensation should be $2.7 million, which is 90% of her 2020 incentive target of $3 million.

 

 

 

LOGO

        

  

 

2020 Key achievements

•  Ms. Dukes successfully assumed CFO responsibilities in August after joining the firm in March. She meaningfully contributed to Invesco’s strategy to navigate the market downturn with a particular focus on liquidity and capital management to create financial flexibility.

•  Under her leadership, the company ended the year with $1.4 billion in cash and no balance on the credit facility.

•  Ms. Dukes led the company’s efforts to conduct a strategic evaluation, identifying discrete cost initiatives that will be executed over the course of two years and allow continued investment in the business while reducing adjusted operating expenses by a net $200 million by the end of 2022. We realized $30 million in annualized savings in the fourth quarter.

•  She implemented enhancements to the firm’s annual budget review process and key initiatives designed to strengthen internal fiscal discipline and accountability while better aligning capital management practices to the company’s strategic priorities.

•  Ms. Dukes restructured the firm’s financial leadership, retaining key leadership while attracting new talent and strengthening the finance leadership bench.

•  Ms. Dukes joined the Invesco Women’s Network as an Executive Sponsor and will help lead the firm’s efforts to enhance diversity at the firm.

 

 

2021 Proxy Statement        47


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LOGO

 

Andrew T. S. Lo

Senior Managing

Director and Head            

of Asia Pacific

 

 

2020 Compensation

(in 000s)

 

     

 

Responsibilities

Mr. Lo is Senior Managing Director and Head of Asia Pacific.

 

Mr. Lo is responsible for the firm’s operation in the Asia Pacific region where he addresses the large and growing needs of our investors in the region. He works with clients to understand their issues and objectives and finding solutions for them.

 

 

  Base salary    $462
 

 

  Annual incentive award – Cash    $1,400
 

 

  Annual incentive award – Stock deferral    $542
 

 

  Long-term equity award    $2,400
 

 

 

Total annual compensation

 

  

$4,805

 

 

 

  Total incentive compensation    $4,342
 

 

  2020 incentive target    $4,142
 

 

    Total incentive compensation as a % of 2020 incentive target    104.8%   

 

 

Based on the quantitative outcome of Invesco’s performance and a qualitative review of Mr. Lo’s individual performance, the committee determined that Mr. Lo’s total incentive compensation should be $4.34 million, which is 104.8% of his 2020 incentive target of $4.14 million due to Mr. Lo’s exceptional performance in Asia-Pacific. Mr. Lo’s total 2020 compensation was flat compared to 2019.

 

 

 

LOGO   

2020 Key achievements

•  Despite continued challenges from geopolitical tension and pandemic aftershock, Mr. Lo led our Asia-Pacific business to achieve a record year in 2020. With $171.3 billion ending AUM (up 33.1% versus prior year), the region recorded full year net inflows of $23.1 billion, an 80.4% year-over-year increase.

•  The strong inflows were supported by solid investment performance in Asia Pacific investment centers, where 60%, 57% and 77% of the region’s long-term assets outperformed peers on a 1-, 3- and 5-year basis, respectively.1

•  Under Mr. Lo’s leadership, our China growth initiative continued to achieve significant growth. China-sourced AUM increased from $52.2 billion in 2019, to $77.9 billion, up 49.2% year-over-year. Primary drivers of growth were strong new fund launches coupled by accelerated E-commerce development. Invesco’s China franchise was highly recognized by the industry and was ranked # 1 onshore in the most recent Z-Ben ranking among foreign JV fund management companies.

•  Outside of China, Mr. Lo led the region to build a diverse book of business by delivering Invesco’s global investment capabilities to meet client needs. For example, Invesco Japan had significant wins in providing customized beta solutions to prominent asset owners capturing over $7.5 billion of net flows within 6 months of launch.

•  Mr. Lo is committed to enhancing diversity and inclusion in the workplace. At the conclusion of 2020, 41% of the region’s workforce and 38% of the region’s senior leadership are female. Mr. Lo participated in Mutual Mentoring to encourage diversity of thought across different organizational levels.

 

 

 

 

1

Invesco data as of December 31, 2020.

 

 

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LOGO

 

Gregory G. McGreevey    

Senior Managing

Director, Investments

 

2020 Compensation

(in 000s)

 

     

Responsibilities

Mr. McGreevey serves as Senior Managing Director, Investments. In 2020, Mr. McGreevey assumed leadership of the firm’s private market groups (including real estate). He continues his responsibility for certain of Invesco’s global investment teams, trading, Global Performance and Risk Group, Solutions, Indexing, ESG and investment thought leadership/investor engagement.

 

 

  Base salary    $450
 

 

  Annual incentive award – Cash    $1,890
 

 

  Annual incentive award – Stock deferral    $990
 

 

  Long-term equity award    $2,160
 

 

 

Total annual compensation

 

  

$5,490

 

 

 

  Total incentive compensation    $5,040
 

 

  2020 incentive target    $5,800
 

 

  Total incentive compensation as a % of 2020 incentive target    86.9%

 

 

Based on the quantitative outcome of Invesco’s performance and a qualitative review of Mr. McGreevey’s individual performance, the committee determined that Mr. McGreevey’s total incentive compensation should be $5.0 million, which is 86.9% of his 2020 incentive target of $5.8 million. Mr. McGreevey’s total 2020 compensation was down 9.3% compared to 2019.

 

 

 

LOGO

        

  

2020 Key achievements

•  Mr. McGreevey played a critical role in maintaining an engaged and successful workforce during the pandemic and a remote work environment by focusing on authentic and transparent communication with his teams. He successfully led the investments business through market turmoil in the first half of the year and then record flows in fixed income and improved year over year flows in equities in the second half of the year.

•  Mr. McGreevey assumed leadership oversight of the Invesco Real Estate (IRE) business, improving collaboration and connectivity with the firm’s broader investments organization.

•  Under Mr. McGreevey’s leadership, top half investment performance in high demand areas remained strong in long term, peer relative 3- and 5-year measures: Active Fixed Income 80%, 89%, Active Global Equities 68%, 59%, Investment Solutions 100%.1

•  Mr. McGreevey streamlined the firm’s product mix by rationalizing products in multiple areas to improve the firm’s focus on high demand capabilities while addressing challenged areas and bring efficiencies across the platform.

•  Mr. McGreevey successfully executed a strategic evaluation of the investments business and organization in 2020. The objectives of the strategic evaluation were to implement people and process changes that will enhance our investment capabilities and offerings and help us build greater scale.

•  Mr. McGreevey’s 2019 investment in an ESG strategy to transform the organization into a top ESG asset manager benefitted the firm in 2020, joining Climate Action 100+, winning a US award for Best ESG Responsible Investment Expert by Capital Finance International, launching a proprietary ESG platform to provide unique insights to clients, and launching multiple ESG-themed funds and indices.

•  Mr. McGreevey is committed to the firm’s diversity and inclusion goals. In 2020, female hires in the Investments organization increased and Mr. McGreevey participated in the Mutual Mentoring program which encourages diversity of thought across the organization.

 

 

 

1

Invesco data as of December 31, 2020.

 

 

2021 Proxy Statement        49


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LOGO

 

Andrew R. Schlossberg

Senior Managing Director

and Head of the Americas

 

2020 Compensation

(in 000s)

 

     

Responsibilities

Mr. Schlossberg is senior managing director and Head of the Americas business. He has responsibilities for distribution, marketing, global exchange traded funds capabilities, corporate communications and human resources. Prior to taking this role in 2019, Mr. Schlossberg was the senior managing director and Head of EMEA.

 

 

  Base salary    $450
 

 

  Annual incentive award – Cash    $1,638
 

 

  Annual incentive award – Stock deferral    $1,228
 

 

  Long-term equity award    $1,227
 

 

 

Total annual compensation

 

  

$4,545

 

 

 

  Total incentive compensation    $4,095
 

 

  2020 incentive target    $4,550
 

 

  Total incentive compensation as a % of 2020 incentive target    90.0%

 

 

Based on the quantitative outcome of Invesco’s performance and a qualitative review of Mr. Schlossberg’s individual performance, the committee determined that Mr. Schlossberg’s total incentive compensation should be $4.1 million, which is 90% of his 2020 incentive target of $4.55 million. Mr. Schlossberg’s total 2020 compensation was down 9.1% compared to 2019.

 

 

 

LOGO

        

  

2020 Key achievements

•  Under Mr. Schlossberg’s leadership, the Americas business completed its integration of OppenheimerFunds, developed its strategy for growth, contributed to the firm’s efficiency efforts, and managed through the pandemic ensuring the health and safety of our employees and remote engagements with our clients.

•  Americas business momentum strengthened under Mr. Schlossberg’s leadership in the second half of 2020 as long-term net flows improved by $26 billion from the first half of the year. In support of this, our distribution teams transformed the Americas go-to-market to a digital format, which has increased the firm’s client touchpoints and introduced digital tools to assist clients in an extraordinary year.

•  The Americas institutional business development, pipeline management, and multi-year growth strategy led to a meaningful contribution to the firm’s global institutional gross sales and net long-term inflows.

•  Mr. Schlossberg oversaw our global ETF platform growth to an all-time high AUM of $345 billion as of December 31, 2020. In addition, the firm introduced several new innovations including nontransparent active funds and the Invesco QQQ Innovation Suite.

•  Mr. Schlossberg oversaw our efforts to elevate the firm’s brand and profile which resulted in improving our US brand equity ranking as a mutual fund provider to #7, up from #12 in the previous year, and ranked #6 in brand equity amongst asset managers (first year measured).1

•  In Mr. Schlossberg’s role of having overall responsibility for the global human resources and communications function, the firm was able to successfully migrate employees to work from home. He championed increased, transparent employee communications and sponsored several surveys where 98% employees responded they felt supported and that the firm prioritized their safety and health.

•  Mr. Schlossberg continued to be a strong supporter of promoting various diversity and inclusion efforts, including improving the firm’s gender balance within senior management roles and extending or establishing new business resource groups, such as the Black Professional Network and Young Professionals Network.

 

 

 

1

Escalent. Cogent Syndicated. Advisor Brandscape® 2020.

 

 

50        Invesco Ltd.


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LOGO

 

Loren M. Starr

Retired Senior Managing

Director and Chief

Financial Officer

  

2020 Compensation

(in 000s)

 

     

Responsibilities

Mr. Starr retired from his position as senior managing director and chief financial officer on August 1, 2020. Mr. Starr transitioned to an executive advisory role as Vice Chair at that time until his retirement from the company on March 1, 2021.

  
  

 

 
   Base salary      $450  
  

 

 
   Annual incentive award – Cash   

 

 

 

$848

 

 

  

 

 
   Annual incentive award – Stock deferral      $369  
  

 

 
   Long-term equity award   

 

 

 

$1,641

 

 

  

 

 
   Total annual compensation     

 

$3,308

 

 

 

  

 

 
   Total incentive compensation      $2,858  
  

 

    
   2020 incentive target   

 

 

 

$3,150

 

 

  
  

 

    
   Total incentive compensation      90.7%     
  

as a % of 2020 incentive target

 

     

 

 

LOGO  

2020 Key achievements

•  During his tenure as CFO, Mr. Starr worked with the board and management, recommending, and then implementing a decision to cut the dividend by 50% and redeem seed capital to increase the firm’s financial stability during the COVID-19 pandemic. He also led a team to explore other cost containment activities that the firm could execute on in both the short- and long-term.

•  Mr. Starr played an active and integral role in on boarding and transitioning his CFO duties to Ms. Dukes.

•  Mr. Starr continued his role of executive sponsor of the Invesco Proud Network, Invesco’s global LGBTQ+ business resource group.

 

 

2021 Proxy Statement        51


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LOGO    The committee’s process for determining executive compensation

We describe below for our shareholders and other interested parties a summary of the steps that our committee takes in making its compensation decisions.

 

Step 1 – incentive awards may range from 0% to 130% of target

 

Step 2 - ensuring that our incentive pool and incentive awards are commercially viable

  

Step 1 – approving company scorecard and setting individual incentive targets and goals

In early 2020, the committee approved the company scorecard and established annual incentive targets (consisting of cash bonus + annual stock deferral + long-term equity) for our CEO and our other executive officers. Actual incentive awards may range from 0% up to a maximum of 130% of the target amount based on company and individual performance. The committee also approved the company’s operating plan which is part of the annual goals for the company and CEO.

 

In consultation with Johnson Associates, the committee’s independent compensation consultant, the committee set 2020 incentive targets, which are based on the executive’s role. Other than Ms. Dukes, who joined the company in 2020, there were no changes to the 2019 incentive targets. See page 40 for the 2020 incentive targets.

 

Step 2 – setting our company-wide incentive pool

In early 2021, based on 2020 financial results and the company’s performance toward achieving its strategic objectives, the committee set the company-wide incentive pool for 2020 at 41.6% of pre-cash bonus operating income (“PCBOI”). Absolute incentive pools were down year-over-year from 2019. However, as a percentage, the 2020 pool was higher than our 5-year average although within our range (described below). The 2020 company-wide incentive pool is reflective of PCBOI being lower in 2020 and the firm’s need to continue to remain competitive. All incentive awards, including NEO awards, are paid out of this pool.

 

The committee uses a range of 34-48% of PCBOI in setting the company-wide incentive pool. The range includes the cash bonus, deferred and equity pools, as well as the amounts paid under sales commission plans (in which our NEOs do not participate). The range was determined based on historical data and practices of asset management and other similar financial services firms as analyzed by Johnson Associates and data obtained from the McLagan and CaseyQuirk Performance Intelligence Study.

 

Linking the aggregate incentive compensation pool to a defined range of our PCBOI ensures incentive compensation is commercially viable.

   LOGO
Step 3 - the scorecard is a quantitative assessment of company performance   

Step 3 – Using the scorecard to assess company performance

During the fourth quarter of 2020 and early in 2021, the committee conducted its final quantitative assessment of company performance for 2020. The scorecard is based on results achieved and related weightings in the following categories: financial performance 50%; delivering to clients 30%; and organizational strength 20%. For 2020, the committee did not change the goals or targets set at the beginning of the year. The outcomes for our 2020 company scorecard have an overall company score of 72%. See page 42 for more information about our company scorecard results. The committee believes that each of the company performance measures supports the key indicators of company success.

 

 

52        Invesco Ltd.


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Step 4 – the committee applies its qualitative assessment of executive achievements   

Step 4 – qualitative assessment of individual performance and determining individual compensation

 

Aligning pay with performance

During the fourth quarter of 2020 and early in 2021, following the committee’s approval of the company-wide annual incentive pool, the committee assessed each executive’s performance within the context of:

•  company performance as detailed on the company scorecard;

•  each executive’s performance against the executive’s goals; and

•  each executive’s incentive target range.

 

After the quantitative assessment of company performance, the committee applied its qualitative assessment of each executive officer in setting final compensation in order to ensure that outcomes are aligned with company and individual performance and with shareholder interests.

 

Once the committee determined each executive’s total compensation, the committee determined the appropriate mix between cash, stock deferral and long-term equity. For all NEOs, at least 60% of their total incentive is delivered in deferred equity.

 

 

2021 Proxy Statement        53


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LOGO    Our compensation components

 

 

Compensation components

We utilize the following compensation components in our executive compensation program to achieve our objectives:

 

 

Component

  

 

Purpose

  

 

Description

Base salary

Cash

   Provides fixed pay for the performance of day-to-day job duties   

Based on knowledge, skills, experience and scope of responsibility

 

Relatively small portion of total annual compensation

 

Evaluated on an annual basis; generally, remains static unless there is a promotion or adjustment needed due to industry trends

 

Annual incentive award Cash bonus and stock deferral   

Recognizes current year achievement of goals and objectives

 

 

Aligns with company, business unit and individual performance

 

Deferral portion aligns executive with client and shareholder interests and encourages retention by vesting over time

 

  

Based upon assessment of company and individual performance

 

When mandated by local regulatory requirements, we grant awards denominated in our product fund offerings in lieu of annual stock deferral awards

 

Our annual deferral awards vest over four years in equal annual increments

Long-term incentive award

Equity

  

Recognizes potential for future contributions to the company’s long-term strategic objectives

 

Aligns executive with client and shareholder interests and encourages retention by vesting over time

 

  

Based upon assessment of company and individual performance

 

Our long-term equity awards are time-based and vest over four years in equal annual increments

Performance shares Equity   

Aligns executive with client and shareholder interests

 

Encourages retention by vesting based on time and performance measures

  

New for 2020 pay, 60% of the combined value of the annual stock deferral and long-term incentive awards to executive officers is performance-based. Vesting is tied to adjusted operating margin and Relative TSR

 

Our performance-based equity awards have a three-year performance period and three-year cliff vesting

 

 

 

54        Invesco Ltd.


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LOGO    Our compensation philosophy and objectives

 

 

Compensation philosophy

Invesco’s compensation program is designed to support our multi-year strategic objectives and the behaviors and discipline that generate strong performance for our clients and shareholders by:

  aligning the interests of our senior-level employees and NEOs with clients and shareholders through long-term awards and accumulation of meaningful share ownership;
  balancing pay-for-performance with economic outcomes;
  reinforcing our commercial viability by closely linking rewards to Invesco, business unit and individual results and performance;
  attracting, recognizing and retaining the best talent in the industry by ensuring a meaningful mix of cash and deferred compensation; and
  discouraging excessive risk-taking that would have a material adverse impact on our clients, shareholders or company.

Emphasis on deferrals

The committee has designed our executive compensation program so a significant portion of an executive’s compensation is in the form of deferred incentives. The committee believes this appropriately aligns our executive’s interests with our shareholders as it focuses on long-term shareholder value creation.

60% - 70% of incentive compensation of our CEO and each of our senior managing directors is deferred. The committee has no pre-established policy or target on the compensation mix between pay elements.

 

 

Performance-based equity awards

New for 2020, 60% of the combined value of the annual deferral award and the long-term equity award is performance-based. Vesting is tied to the following two performance measures — adjusted operating margin and relative TSR over a three-year period.

The committee believes tying vesting to both adjusted operating margin and relative TSR over a multi-year period aligns with shareholder interests and the following goals with respect to performance-based awards:

Relative TSR

  tracks value created for shareholders as a quantitative measure
  aligns with shareholder interests

Adjusted operating margin (AOM)

  focuses discipline in corporate investments, initiatives and capital allocation
  is consistent with the way the business is managed
  is an important measure of overall strength of an asset manager
  aligns with Invesco’s shareholder value framework
  is a primary measure of focus of industry analysts
  is improved through effective management over the long-term
  more effectively avoids conflicts of interest with clients

Performance award vesting matrix

The number of shares that vest will equal the target award amount multiplied by the vesting percentage associated with the Average AOM and Relative TSR ranking on the chart below. Vesting may range from 0% to 150%. We believe that the linked vesting performance thresholds provides significant rigor to our incentive program, as payouts are not a range of outcomes but represent specific performance levels.

 

 

2021 Proxy Statement        55


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The below vesting matrix is for performance-based equity awards granted in connection with 2020 pay.

 

Absolute 3-year    Relative TSR1  

average AOM (%)

                 Lowest          7th          Median          3rd          Highest    

< 41.0

     100%                  116%                  133%                  142%                  150%    

40.0

     83%          103%          122%          133%          142%    

39.0

     67%          90%          111%          123%          133%    

37.5

     50%          75%          100%          113%          125%    

36.0

     33%          58%          83%          100%          117%    

34.5

     17%          42%          68%          88%          108%    

< 33.0

     0%          25%          50%          75%          100%    

 

1

Points between the stated data points are determined by ratable straight line interpolation.

If Invesco’s Relative TSR is the lowest ranked and average adjusted operating margin is 33% or less, then our CEO and each of our executives will not be entitled to a distribution of any shares or accrued dividends.

The rigor of the thresholds, as well as the partial vesting of awards for failure to meet the target range and an upside opportunity for performance beyond the target range, align with the the company’s operating plan and committee’s belief that the company’s performance-based awards demonstrate our pay-for-performance philosophy.

Below is a summary of the features of our performance awards:

 

   
Performance-based award features     
Performance period    Three years
   
Performance metrics    Adjusted operating margin and Relative TSR
   
Performance vesting range    0% - 150%; straight line interpolation used for actual result
   
Vesting    3-year cliff
   
Dividends    Deferred and paid only to the extent an award vests
   
Settlement    Shares
   
Clawback    Subject to clawback policy in the event of fraudulent or willful misconduct

See page 57 for a list of peers that we use for our performance-based equity awards.

Role of the compensation committee

The committee’s responsibilities include:

 

  reviewing and making recommendations to the board about the company’s overall compensation philosophy;

 

  approving the aggregate compensation pool;

 

  evaluating the performance of, and setting the compensation for, the CEO; and

 

  overseeing management’s annual process for evaluating the performance of, and approving the compensation for, all other executive officers.

Role of the independent compensation consultant

The committee has engaged Johnson Associates, an independent consulting firm, to advise it on director and executive compensation matters. Johnson Associates assists the committee throughout the year by:

 

  providing analysis and evaluation of our overall executive compensation program, including compensation paid to our directors and NEOs;

 

  attending certain meetings of the committee and periodically meeting with the committee without members of management present;

 

  providing the committee with market data and analysis that compares executive compensation paid by the company with that paid by other firms in the financial services industry, which we consider generally comparable to us; and

 

  providing commentary regarding market conditions, market impressions and compensation trends.
 

 

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Under the terms of its engagement with the committee, Johnson Associates does not provide any other services to the company unless the committee has approved such services. No such other services were provided in 2020. The committee has considered various factors as required by NYSE rules as to whether the work of Johnson Associates with respect to director and executive compensation-related matters raised any conflict of interest. The committee has determined no conflict of interest was raised by the engagement of Johnson Associates.

Role of the executive officers

Our chief executive officer meets with the non-executive directors throughout the year to discuss executive performance and compensation matters, including proposals on compensation for individual executive officers (other than himself). Our chief executive officer and head of human resources work with the committee to implement our compensation philosophy. They also provide to the committee information regarding financial and investment performance of the company as well as our progress toward our long-term strategic objectives. Our chief financial officer assists as needed in explaining specific aspects of the company’s financial performance.

 

 

Market data

The committee, with assistance from Johnson Associates, reviews the composition of our peer group to ensure that the group continues to serve as an appropriate market reference for executive compensation purposes. In considering the composition of our peer group, the committee considers a broad set of comparators firms from several perspectives. The committee evaluates business model and scope, historical pay ranges, and competitors who we compete for talent.

Recent industry consolidation and a corresponding decline in the number of relevant peer firms, have created challenges in identifying a meaningful peer group. During the committee’s recent peer group assessment, emphasis was given to a narrower, exclusively investment management focused peer group. The peer group emphasizes pure asset management firms supplemented by firms with significant business overlap and similar scale.

The company’s peer group does not solely determine executive pay outcomes but is a reasonable reference point and one of multiple perspectives considered when determining executive (including NEO) pay.

Below is the compensation peer group that we will use for 2021 as well as for the 2020 performance-based awards that were granted in February 2021:

 

Peer group        

•  AllianceBernstein1

 

•  Goldman Sachs (Asset Management)

 

•  Northern Trust1

•  Bank of NY Mellon1

 

•  Janus Henderson1

 

•  State Street1

•  BlackRock1

 

•  Lazard1

 

•  T. Rowe Price1

•  Franklin Resources1

 

•  Morgan Stanley (Investment Management)

 

 

   
1

Vesting for performance-based equity awards is calculated based on absolute adjusted operating margin and the TSR of the company and its designated peer group. The above firms comprise the designated peer group for purposes of determining relative TSR for performance-based equity awards.

 

 

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LOGO

Compensation policies and practices

 

 

Summary of executive compensation practices

Our executive compensation program reflects our commitment to responsible financial and risk management and is demonstrated by the following policies and practices:

 

 

What we do

 

Align pay with performance

Link incentive compensation to the firm’s performance

Emphasize deferred compensation with long vesting periods in order to align executives with client and shareholder interests

Robust performance measures

Require 60% of equity awards for executive officers to be performance-based

Maintain a clawback policy for executive officers for performance-based compensation

Engage in frequent outreach to provide shareholders and major proxy advisory firms with opportunities for feedback and insights on our executive compensation program

Maintain significant stock ownership guidelines for our executive officers

Maintain a cap on cash bonuses for our executive officers and total compensation cap for our CEO

Utilize “double triggers” for vesting of equity awards in the event of a change in control

Retain an independent compensation consultant to assess our executive compensation program

 

What we don’t do

 

X

No dividends or dividend equivalents on unvested performance-based awards

X

No tax gross ups

X

No short selling, hedging or pledging of company stock by insiders

X

No share recycling on stock options and stock appreciation rights

X

No reloads on stock options or SARs

X

No supplemental retirement benefits or retirement arrangements

X

No supplemental severance benefit arrangements outside of standard benefits

X

No repricing of stock options without shareholder approval

 

 

 

Stock ownership policy

Our Executive Officer Stock Ownership Policy requires the CEO to hold at least 250,000 shares of Invesco common stock. All other executives must hold at least 100,000 shares of Invesco common stock. All of our executives have exceeded the stock ownership requirements.

 

 

Hedging policy

As part of our Insider Trading Policy, our hedging policy prohibits hedging or monetization transactions, such as zero-cost collars and forward sale contracts, involving our securities; however, limited exceptions are allowed. To date, no exceptions have been made. The hedging policy is in place for all of our directors, officers, employees and any of their respective (i) family members that reside in the same household as the individual, (ii) anyone else who lives in the household, (iii) family members outside of the household that the individual directs or influences control and (iv) any entities, including any corporations, partnerships or trusts that the individual influences or controls. Certain aspects of this policy do not apply to Trian, an institutional investment manager of which Mr. Garden is Chief Investment Officer and Mr. Peltz is Chief Executive Officer, and the funds and investment vehicles managed by Trian. The company’s general policy nevertheless applies to each of Mr. Garden and Mr. Peltz in his individual capacity.

 

 

Clawback policy

All performance-based equity awards held by our executive officers are subject to forfeiture or “clawback” provisions, which provide that any vested or unvested shares, any dividends and the proceeds from any sale of such shares, are subject to recovery by the company in the event that:

 

  the company issues a restatement of financial results to correct a material error;

 

  the committee determines that fraud or willful misconduct on the part of the employee was a significant contributing factor; and

 

  some or all of the shares granted or received prior to such restatement would not have been granted or received based upon the restated financial results.
 

 

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Benefits

All NEOs are entitled to receive medical, life and disability insurance coverage and other corporate benefits available to most of the company’s employees working in the same country. NEOs are also eligible to participate in the Employee Stock Purchase Plan on the same terms as the company’s other employees. In addition, the NEOs may participate in the 401(k) plan or similar retirement savings plans in the NEO’s home country.

 

 

Perquisites

The company provides limited perquisites to its NEOs to aid the executives in their execution of company business. The committee believes the value of perquisites are reasonable in amount and consistent with its overall compensation plan.

Mr. Flanagan has personal use of company-provided aircraft. The company leases an airplane for which it pays direct operating expenses, monthly lease payments and management fees.

Compensation attributed to our NEOs for 2020 perquisites is included in the All Other Compensation Table for 2020 on page 62.

 

 

Tax reimbursements

Invesco did not provide tax reimbursements for any perquisites or other compensation paid to our NEOs.

 

 

Tax deductibility of compensation

The committee considers the tax and accounting consequences of the compensation plans applicable to executive officers. Under Internal Revenue Code Section 162(m), compensation paid to certain executive officers of public companies in excess of $1 million in any tax year generally is not deductible. The performance-based pay exception to the deduction limit previously available under Section 162(m) is no longer available except with respect to certain grandfathered amounts which may continue to be deductible. No actions have been taken that were intended to impact the status of any grandfathered amounts.

 

 

Employment agreements

Martin L. Flanagan — Our CEO has an employment agreement with the company. Under the employment agreement, Mr. Flanagan is employed as President and Chief Executive Officer of the company. The agreement terminates upon the earlier of December 31, 2025 (the year in which Mr. Flanagan reaches age 65) or the occurrence of certain events, including death, disability, termination by the company for “cause” or termination by Mr. Flanagan for “good reason.”

The terms of Mr. Flanagan’s amended employment agreement provide:

  an annual base salary of not less than $790,000;

 

  the opportunity to receive an annual cash bonus award based on the achievement of performance criteria;

 

  the opportunity to receive share awards based on the achievement of performance criteria;

 

  eligibility to participate in incentive, savings and retirement plans, deferred compensation programs, benefit plans, fringe benefits and perquisites and paid vacation, all as provided generally to other U.S.-based senior executives of the company; and

 

  certain stipulations regarding termination of employment that are described in Potential Payments Upon Termination or Change in Control.

In the event of his termination without “cause” or resignation for “good reason”, Mr. Flanagan is entitled to receive the following payments and benefits (provided he has not breached certain restrictive covenants):

 

  his then-effective base salary through the date of termination;

 

  a prorated portion of the greater of $4,750,000 or his most recent annual cash bonus;

 

  immediate vesting of all outstanding share-based awards (with performance-based awards vested at 100% of target);

 

  any compensation previously deferred under a deferred compensation plan (unless a later payout date is stipulated in his deferral arrangements);

 

  a cash severance payment generally equal to the sum of (i) his base salary; (ii) the greater of $4,750,000 or his most recent annual cash bonus; and (iii) the amount of his most recent annual equity grant (unless the value thereof is less than 50% of the next previously-made grant, in which case the value of the next previously-made grant will be used);

 

  continuation of medical benefits for him, his spouse and his covered dependents for a period of up to 36 months following termination;

 

  any accrued vacation; and

 

  any other vested amounts or benefits under any other plan or program.
 

 

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Loren Starr — On February 24, 2020, the company announced that Mr. Starr would transition from chief financial officer to Vice Chair of the company effective August 1, 2020. As Vice Chair, Mr. Starr acted as a senior advisor to the company’s executive management team and led special projects. Mr. Starr remained Vice Chair until his retirement from the company on March 1, 2021.

In July 2020, the committee approved the acceleration of all unvested annual stock deferral awards and long-term equity awards (with performance-based awards vesting at 100% of target) given Mr. Starr’s 15 years of valuable service to the company. Mr. Starr’s incentive awards were accelerated as of March 1, 2021.

Other NEOs — Our other NEOs are parties to employment arrangements that create salary continuation periods of six or twelve months in the event of involuntary termination of service without cause or unsatisfactory performance. See Potential payments upon termination or change in control below.

 

 

Potential payments upon termination or change in control

Generally, all participants in our global equity incentive plans who hold equity awards (other than the parties covered by UCITS), including our NEOs, are eligible, under certain circumstances, for accelerated vesting in the event of a change of control of the company that is followed by involuntary termination of employment other than for cause or unsatisfactory performance or by voluntary termination for “good reason”.

 

 

Compensation committee report

The compensation committee has reviewed and discussed with management the Compensation Discussion and Analysis included in this Proxy Statement. Based on this review and discussion, the compensation committee has recommended to the board that the Compensation Discussion and Analysis be included in this Proxy Statement and incorporated by reference into our Annual Report on Form 10-K for the year ended December 31, 2020.

Respectfully submitted by the compensation committee:

C. Robert Henrikson (Chair)

Sarah E. Beshar

Thomas M. Finke1

Edward P. Garden1

William F. Glavin, Jr.

Denis Kessler

Sir Nigel Sheinwald

G. Richard Wagoner, Jr.

Phoebe A. Wood

 

 

 

1

Mr. Finke joined the Compensation Committee effective December 1, 2020, and Mr. Garden joined the Compensation Committee effective November 4, 2020.

 

 

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Summary compensation table for 2020

The following table sets forth information about compensation earned by our named executive officers during 2018, 2019 and 2020 in accordance with SEC rules. The information presented below may be different from compensation information presented in this Proxy Statement under the caption Executive compensation — Compensation discussion and analysis, as such section describes compensation decisions made in respect of the indicated year, regardless of when such compensation was actually paid or granted. For an explanation of the principal differences between the presentation in the Compensation discussion and analysis and the table below, please see the note on page 44.

 

             
Name and Principal Position    Year      Salary ($)1     

Share

awards ($)2

     Non-equity
incentive plan
compensation
($)3
     All other
compensation
($)4
     Total ($)  

Martin L. Flanagan

     2020        790,000        7,755,984        3,093,000        108,118        11,747,102  

President and Chief

     2019        790,000        6,909,962        3,704,000        114,987        11,518,949  

Executive Officer

     2018        790,000        8,714,798        3,300,000        116,901        12,921,699  

 

 

L. Allison Dukes

     2020        500,000        1,499,996        900,000        7,550        2,907,546  

Senior Managing Director

and Chief Financial Officer

                 

 

 

Andrew T.S. Lo

     2020        462,398        2,941,920        1,400,000        69,536        4,873,854  

Senior Managing Director

     2019        458,070        2,729,163        1,400,000        63,677        4,650,910  

and Head of Invesco Asia Pacific

     2018        457,978        2,628,842        1,337,213        63,570        4,487,603  

 

 

Gregory G. McGreevey

     2020        450,000        3,499,978        1,890,000        30,024        5,870,002  

Senior Managing Director,

     2019        450,000        2,749,364        2,100,000        30,309        5,329,673  

Investments

     2018        450,000        2,632,942        1,800,610        29,349        4,912,901  

 

 

Andrew R. Schlossberg

     2020        450,000        2,729,981        1,638,000        63,676        4,881,657  

Senior Managing Director,

     2019        450,000        2,186,395        1,820,000        87,966        4,544,361  

Head of the Americas

     2018        450,000        2,159,940        1,457,600        47,442        4,114,982  

 

 

Loren M. Starr

     2020        450,000        2,037,974        848,160        32,096        3,368,230  

Retired Vice Chair, Former

     2019        450,000        2,037,854        912,000        31,934        3,431,788  

Senior Managing Director and

     2018        450,000        2,072,928        911,976        30,830        3,465,734  

Chief Financial Officer

                 

 

 

 

1

For each of the named executive officers, includes salary that was eligible for deferral, at the election of the named executive officer, under our 401(k) plan or similar retirement savings plan in the named executive officer’s country. For each of the named executive officers, salary is unchanged from 2019. For Mr. Lo, base salary is converted to U.S. dollars using an average annual exchange rate, which accounts for the different salary amounts shown despite the fact Mr. Lo’s salary has not charged during the periods shown.

2

For share awards granted in 2020, includes (i) time-based equity awards that vest in four equal annual installments on each anniversary of the date of grant; and (ii) performance-based awards, which are subject to a three-year performance period (2020-2022) and vest on February 28, 2023. The value of performance-based awards is based on the grant date value and reflects the probable outcome of such conditions and represents the target level (100%) of achievement. If maximum level of performance had been assumed, the grant date fair value of the performance-based awards would have been: (i) $$5,816,988 for Mr. Flanagan; (ii) $1,528,481 for Mr. Starr; (iii) $2,206,440 for Mr. Lo; (iv) $2,624,983 for Mr. McGreevey; and (v) $2,047,486 for Mr. Schlossberg. See Grants of plan-based share awards for 2020 below for information about the number of shares underlying each of the equity awards. Grant date fair values were calculated in accordance with Financial Accounting Standards Board (FASB) Accounting Standards Codification Topic 718 “Compensation — Stock Compensation” (“ACS 718”). The grant date fair value was calculated by multiplying the target number of shares granted by the closing price of the company’s common shares on the date of grant. The amounts disclosed do not reflect the value actually realized by the named executive officers. For additional information, please see Note 12 — “Common Share-Based Compensation” to the financial statements in our 2020 Annual Report on Form 10-K.

3

Reflects annual cash bonus award earned for the year by the named executive officers and paid in February of the following year.

4

The table below reflects the items that are included in the All Other Compensation column for 2020.

 

 

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All other compensation table for 2020

 

Name    Insurance
premiums ($)
    

Company
contributions to
retirement and

401(k) plans ($)1

     Tax
consultation ($)
     Perquisites ($)2      Total all other
compensation ($)
 

Martin L. Flanagan

     9,558        23,100               75,460        108,118  

L. Allison Dukes

     300        6,000                      6,300  

Andrew T.S. Lo

     8,186        53,425        6,000               69,536  

Gregory G. McGreevey

     6,924        23,100                      30,024  

Andrew R. Schlossberg

     2,460        23,100        30,961        7,155        63,676  

Loren M. Starr

     8,996        23,100                      32,096  

 

1

Amounts of matching contributions paid by the company to our retirement savings plans are calculated on the same basis for all plan participants, including the named executive officers.

2

Perquisites include the following:

With respect to Mr. Flanagan, includes $69,125 for his personal use of company-provided aircraft. The company leases an airplane for which it pays direct operating expenses and monthly lease payments and management fees. We calculate the aggregate incremental cost to the company for personal use based on the average variable costs of operating the airplane. Variable costs include fuel, repairs, travel expenses for the flight crews and other miscellaneous expenses. This methodology excludes fixed costs that do not change based on usage, such as depreciation, maintenance, taxes and insurance. Mr. Flanagan’s total also includes certain amounts for technology support and the value of a gift presented by the company.

With respect to Mr. Schlossberg, includes (i) $6,431 for temporary housing paid for by the company in connection with his relocation, and (ii) the value of a gift presented by the company.

 

 

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Grants of plan-based share awards for 2020

The compensation committee granted equity awards to each of the named executive officers during 2020. Equity awards are subject to transfer restrictions and are generally subject to forfeiture prior to vesting upon a recipient’s termination of employment. All equity awards immediately become vested upon the recipient’s termination of employment during the 24-month period following a change in control (i) by the company other than for cause or unsatisfactory performance, or (ii) by the recipient for good reason.

The following table presents information concerning plan-based awards granted to each of the named executive officers during 2020.

 

 

 
              Estimated future payouts under         Estimated future payout under     All     Grant  
              non-equity incentive plan awards         equity incentive plan awards     other     date  
Name   Grant
date1
  Type of
award2
   

Threshold

(#)3

   

Target

(#)3

   

Maximum

(#)3

       

Threshold

(#)3

   

Target

(#)3

   

Maximum

(#)3

    share
awards
(#)4
    fair value
of share
awards ($)5
 

 

 

Martin L.

  02/28/20     Time                                             269,305       3,877,992  

Flanagan

  02/28/20     Performance                                 269,305       403,958