UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

 

 

SCHEDULE 14A INFORMATION

Proxy Statement Pursuant to Section 14(a) of the

Securities Exchange Act of 1934

(Amendment No.    )

 

 

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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 Materials under § 240.14a-12

S&P Global Inc.

(Name of Registrant as Specified In Its Certificate)

 

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

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55 Water Street

New York, NY 10041-0003

 

 

March 19, 2018

Dear Fellow Shareholder:

On behalf of our Board of Directors and management, we cordially invite you to attend our Annual Meeting of Shareholders on Tuesday, May 1, 2018. The Annual Meeting will be held at 55 Water Street, New York, New York, 10041, at 11:00 a.m. (EDT). If you are unable to attend the Annual Meeting in New York, please join us via live webcast on the Company’s website at www.spglobal.com.

The Notice of Annual Meeting of Shareholders and Proxy Statement accompanying this letter describe the business we will consider at the Annual Meeting. Your vote is very important. We urge you to vote to be certain your shares are represented at the Annual Meeting even if you plan to attend. Most shareholders have a choice of voting over the Internet, by telephone or by using a traditional proxy card. Please refer to your proxy materials or the information forwarded by your bank, broker or other holder of record to see which methods are available to you.

We look forward to seeing you at the Annual Meeting.

 

Charles E. Haldeman, Jr. Chairman of the Board		Douglas L. Peterson President and Chief Executive Officer

		55 Water Street New York, NY 10041-0003

 

Notice of Annual Meeting of Shareholders

To Be Held Tuesday, May 1, 2018

The Annual Meeting of Shareholders of S&P Global Inc. will be held on Tuesday, May 1, 2018, at 11:00 a.m. (EDT) at 55 Water Street, New York, New York, 10041. At the Annual Meeting, shareholders will be asked to:

 

Items of Business						Board’s Recommendation
1. Elect 12 Directors;							FOR each Director Nominee
2. Approve, on an advisory basis, the executive compensation program for the Company’s named executive officers, as described in this Proxy Statement;							FOR
3. Ratify the selection of Ernst & Young LLP as our independent registered public accounting firm for 2018; and							FOR
4. Consider any other business, if properly raised.

 

This notice and proxy statement is being mailed or made available on the Internet to shareholders on or about March 19, 2018. These materials describe the matters being voted on at the Annual Meeting and contain certain other information. In addition, these materials are accompanied by a copy of the Company’s 2017 Annual Report that includes financial statements as of and for the fiscal year ended December 31, 2017.

All shareholders of record as of the close of business on March 12, 2018 will be entitled to vote, in person or by proxy, at the Annual Meeting.

We urge you to participate in electing directors and deciding the other items on the agenda for the Annual Meeting. Please cast your votes by one of the following methods:

 

The Internet		Signing and Returning a Proxy Card		Toll-Free Telephone		In Person at the Annual Meeting

If you accessed this proxy statement through the Internet after receiving a Notice of Internet Availability of Proxy Materials, you may cast your vote over the Internet by following the instructions in that Notice.

If you received this proxy statement by mail, you may cast your vote by mail, by telephone or over the Internet by following the instructions on the enclosed proxy card.

If you plan to attend the Annual Meeting in person and you are a shareholder of record, you will need your admission ticket in order to enter the Annual Meeting. If you plan to attend the Annual Meeting in person and you are a beneficial owner, you will need proof of beneficial ownership of the Company’s common stock as of the record date in order to enter the Annual Meeting. If you are unable to attend the Annual Meeting in New York, please join us via live webcast on the Company’s website at www.spglobal.com.

Whether or not you plan to attend the Annual Meeting, your vote is very important.

By Order of the Board of Directors.

Taptesh (Tasha) K. Matharu

Associate General Counsel

& Corporate Secretary

New York, New York

March 19, 2018

 

TABLE OF CONTENTS

 

General Information			1
Board of Directors and Corporate Governance			7
Enhanced Corporate Governance Environment			8
Corporate Governance Materials			10
Director Independence			10
Additional Information Regarding Director Independence			10
Annual Meeting Attendance			11
Leadership Structure of the Board of Directors			11
Role of Board of Directors in Risk Oversight			12
Succession Planning			13
Process for Identifying and Evaluating Directors and Nominees			14
Specific Experience, Qualifications, Attributes and Skills of Directors			15
Director Nominees			16
Committees of the Board of Directors			28
Nominating and Corporate Governance Committee			28
Audit Committee			29
Compensation and Leadership Development Committee			29
Executive Committee			31
Financial Policy Committee			31
Membership and Meetings of the Board and Its Committees			32
Compensation Committee Interlocks and Insider Participation			32
Director and Officer Indemnification and Insurance			32
Transactions with Related Persons			33
Board and Committee Self-Evaluations			34
Executive Sessions			34
Executive Compensation Matters			35
Compensation Discussion and Analysis			35
Compensation Committee Report			67
Executive Compensation Tables			68
2017 Summary Compensation Table			68
2017 Grants of Plan-Based Awards Table			71
Outstanding Equity Awards at 2017 Fiscal Year-End Table			72
Option Exercises and Stock Vested in 2017 Table			73
2017 Pension Benefits Table			74
2017 Non-Qualified Deferred Compensation Table			76
Ratio of Chief Executive Officer Pay to Employee Median Pay			77
Potential Payments upon Termination or Change-in-Control			78
Director Compensation			84
2017 Director Compensation Table			84
Director Compensation and Governance			86
Ownership of Company Stock			88
Company Stock Ownership of Management			88
Company Stock Ownership of Certain Beneficial Owners			89
Section 16(a) Beneficial Ownership Reporting Compliance			90
Independent Registered Public Accounting Firm’s Fees and Services			90
Audit Committee Report			91

 

		2018 Proxy Statement				i

Items of Business to be Acted on at the Annual Meeting			92
Item 1. Election of Directors			92
Item  2. Proposal to Approve, on an Advisory Basis, the Executive Compensation Program for the Company’s Named Executive Officers			93
Item  3. Proposal to Ratify the Appointment of the Company’s Independent Registered Public Accounting Firm			94
Item 4. Other Matters			95
Exhibits			A-1
Exhibit A			A-1
Exhibit B			B-1

 

ii				2018 Proxy Statement

GENERAL INFORMATION

 

S&P Global Inc.

Proxy Statement

2018 Annual Meeting of Shareholders

GENERAL INFORMATION

Why did I receive this Proxy Statement?

The Board of Directors of S&P Global Inc. (the “Company,” “we” or “us”) is soliciting proxies for the 2018 Annual Meeting of Shareholders (the “Annual Meeting”) to be held on Tuesday, May 1, 2018, at 55 Water Street, New York, New York 10041, at 11:00 a.m. (EDT) and at any adjournment of the Annual Meeting. When the Company asks for your proxy, we must provide you with a Proxy Statement that contains certain information specified by law. This Proxy Statement summarizes the information you need in order to vote at the Annual Meeting.

Why have I received a Notice Regarding Internet Availability of Proxy Materials instead of printed copies of these materials in the mail?

In accordance with rules promulgated by the Securities and Exchange Commission (“SEC”), we have elected to furnish our proxy materials to shareholders over the Internet. Most shareholders are receiving by mail a Notice of Internet Availability of Proxy Materials (“Notice”), which provides general information about the Annual Meeting, the address of the website on which our proxy statement and annual report are available for review, printing and downloading and instructions on how to submit proxy votes. For those who wish to receive their materials in a different format (e.g., paper copy by mail or electronic copy by e-mail), the Notice contains instructions on how to do so. Shareholders who have previously consented to electronic delivery will receive an e-mail with a web address to view the proxy statement and annual report online, along with instructions on how to vote.

What will I vote on?

The following items:

 

1.

election of 12 Directors;

 

2.

approval, on an advisory basis, of the executive compensation program for the Company’s named executive officers, as described in this Proxy Statement;

 

3.

ratification of the selection of Ernst & Young LLP as our independent registered public accounting firm for 2018; and

 

4.

other matters that may properly be brought before the Annual Meeting.

Will there be any other items of business on the agenda?

We do not expect any other items of business at the Annual Meeting. Nonetheless, if there is an unforeseen need, your proxy will give discretionary authority to the persons named on the proxy to vote on any other matters that may be properly brought before the Annual Meeting. These persons will use their best judgment in voting your proxy.

Who can vote?

Shareholders as of the close of business on the record date, which is March 12, 2018, may vote at the Annual Meeting.

How many votes do I have?

You have one vote at the Annual Meeting for each share of common stock you held on the record date.

What does it mean to be a “shareholder of record”?

If, as of the close of business on the record date, your shares were registered directly in your name with our transfer agent, Computershare, you are a shareholder of record. As a shareholder of record, you may vote in

 

		2018 Proxy Statement				1

GENERAL INFORMATION (continued)

 

person at the Annual Meeting or by proxy. The Company is incorporated in New York and, in accordance with New York law, a list of the Company’s common shareholders of record as of the record date will be available for inspection at the Annual Meeting upon request.

What does it mean to beneficially own shares in “street name”?

If, as of the close of business on the record date, your shares were not held directly in your name but rather were held in an account at a brokerage firm, bank or similar intermediary organization, then you are the beneficial holder of shares held in “street name.” The intermediary is considered to be the shareholder of record for purposes of voting at the Annual Meeting. As a beneficial owner, you have the right to direct the intermediary how to vote the shares held in your account.

How do I vote my shares of Company common stock?

If you are a shareholder of record, you can vote in the following ways:

 

•

By Internet. Follow the Internet voting instructions included on the Notice or proxy card you received. You may vote at any time up until 11:59 p.m. (EDT) on April 30, 2018.

•

By Telephone. Follow the telephone voting instructions included on the proxy card you received. You may vote at any time up until 11:59 p.m. (EDT) on April 30, 2018.

•

By Mail. If you received a printed copy of the proxy materials from us by mail, you may vote by mail by marking, dating and signing your proxy card in accordance with the instructions on it and returning it by mail in the pre-addressed reply envelope provided with the proxy materials. The proxy card must be received prior to the Annual Meeting.

•

In Person. You may vote your shares in person at the Annual Meeting. The Company will give you a ballot at the Annual Meeting. Even if you plan to attend the Annual Meeting, we urge you to vote in advance by Internet, telephone or mail so that your vote will be counted in the event you later decide not to attend the Annual Meeting.

If you are a beneficial owner, you can vote in the following ways:

 

•

As the beneficial owner, you have the right to direct your broker on how to vote the shares in your account. Your broker should give you instructions for voting your shares by Internet, telephone or mail. As a beneficial owner, you are invited to attend the Annual Meeting, but you may not vote your shares in person at the Annual Meeting unless you request and obtain a valid legal proxy from your broker giving you the legal right to vote the shares at the Annual Meeting.

How will my shares be voted if I do not give specific voting instructions when I deliver my proxy?

Shareholders of Record

If you are a shareholder of record and you return a signed proxy card without indicating your vote for some or all of the matters, your shares will be voted as follows for any matter you did not vote on:

 

•

“FOR” the 12 nominees to the Board;

•

“FOR” approval, on an advisory basis, of the executive compensation program for the Company’s named executive officers; and

•

“FOR” the ratification of the selection of Ernst & Young LLP as our independent registered public accounting firm for 2018.

Beneficial Owners

As noted above, as the beneficial owner of shares held in street name, your broker is required to vote your shares in accordance with your instructions. If you do not give instructions, one of two things can happen depending on whether the proposal is considered “routine” or “non-routine” under the rules of the New York Stock Exchange (the “NYSE”):

 

•

If the proposal is considered “routine” under the rules of the NYSE, the broker may vote your shares in its discretion.

 

2				2018 Proxy Statement

GENERAL INFORMATION (continued)

 

•

If the proposal is considered “non-routine” under the rules of the NYSE, the broker may not vote your shares without your instructions. When a broker refrains from voting your shares because the broker has not received your instructions, it is called a “broker non-vote.”

Item 3 in this Proxy Statement (ratification of the selection of Ernst & Young LLP as our independent registered public accounting firm for 2018) will be considered routine under the rules of the NYSE and the broker may vote your shares for this Item in its discretion. The broker is not entitled to vote your shares on the other Items unless the broker has received instructions from you.

What should I do if I want to attend the Annual Meeting?

Only shareholders (of record or beneficial) and their proxy holders may attend the Annual Meeting.

If you are a shareholder of record and receive your proxy materials by mail, you will find an admission ticket attached as part of the proxy card or Notice sent to you. If you plan to attend the Annual Meeting, please bring your admission ticket with you to the Annual Meeting. If you are a shareholder of record and receive your materials electronically, and vote via the Internet, please print out the admission ticket you will find online and bring it with you.

If your shares are held in street name (i.e., you are a beneficial owner), you must bring to the Annual Meeting an account statement or letter from the broker, bank, trustee or other intermediary organization that holds your shares indicating that you were the beneficial owner of the shares on March 12, 2018.

When you arrive at the Annual Meeting, you may be asked to present photo identification, such as a driver’s license, to be admitted. S&P Global Inc. employees wishing to attend the Annual Meeting can present their current employee identification card to be admitted.

For safety and security reasons, no cameras, large bags, briefcases, packages, recording equipment or other electronic devices will be permitted in the Annual Meeting.

Whether you hold shares as a shareholder of record or are a beneficial owner, we urge you to vote in advance by Internet, telephone or mail so that your vote will be counted in the event you later decide not to attend the Annual Meeting.

How do I vote my shares in the Company’s Dividend Reinvestment Plan?

If you participate in the Company’s Dividend Reinvestment Plan, any proxy you give will also govern the voting of all shares you hold in this Plan.

How do I vote my shares in the Company’s Employee Stock Purchase Plan?

If you participate in the Company’s Employee Stock Purchase Plan, any proxy you give will also govern the voting of any shares you hold in this Plan. Any Plan shares for which we do not receive instructions from the employee will not be voted. Plan shares cannot be voted in person at the Annual Meeting.

How do I vote my shares in the Company’s 401(k) Savings and Profit Sharing Plans?

If you received this Proxy Statement because you are an employee of the Company who participates in one of the Company’s 401(k) Savings and Profit Sharing Plans and you have shares of common stock of the Company allocated to your account under one of these Plans, you may vote your shares held in these Plans as of March 12, 2018 by mail, by telephone or via the Internet. Instructions are provided on the proxy card you received from Computershare. Computershare must receive your instructions by 2:00 p.m. (EDT) on April 27, 2018 in order to communicate your instructions to the Plans’ Trustee, who will vote your shares. Any Plan shares for which we do not receive instructions from the employee will be voted by the Trustee in the same proportion as the shares for which we have received instructions. Plan shares cannot be voted in person at the Annual Meeting.

 

		2018 Proxy Statement				3

GENERAL INFORMATION (continued)

 

Can I revoke or change my vote?

Yes. If you are a shareholder of record, you have the right to revoke your proxy at any time before the Annual Meeting by sending a signed notice to the Corporate Secretary, c/o Office of the General Counsel, S&P Global Inc., 55 Water Street, New York, New York 10041-0003 or by sending an e-mail to the Corporate Secretary at corporate.secretary@spglobal.com. If you want to change your vote before the Annual Meeting, you must deliver a later dated proxy by telephone, via the Internet or in writing. You may also change your proxy by voting in person at the Annual Meeting.

If you are a beneficial owner, please refer to the information forwarded by your broker for procedures on revoking or changing your proxy.

What are the requirements to conduct business at the Annual Meeting?

In order to conduct business at the Annual Meeting, we must have a quorum. This means at least a majority of the outstanding shares entitled to vote must be present in person or represented by proxy at the Annual Meeting. You are part of the quorum if you have voted by proxy. As of the record date, 249,359,076 shares of Company common stock were outstanding and eligible to vote.

Are abstentions and broker non-votes part of the quorum?

Yes. Abstentions and broker non-votes count as “shares present” at the Annual Meeting for purposes of determining a quorum.

What are the costs of soliciting these proxies and who will pay them?

The Company will pay all costs of soliciting these proxies. In addition, some of our officers and employees may solicit proxies by telephone or in person. We will reimburse brokers for the expenses they incur in forwarding the proxy materials to you. The Company has retained Georgeson LLC to assist us with the solicitation of proxies for a fee not to exceed $19,000, plus reimbursement for out-of-pocket expenses.

How many votes are required for the approval of each Item?

•

Item One – A nominee will be elected as a Director if he or she receives a majority of the votes cast at the Annual Meeting. A majority of votes cast means that the number of shares voted “for” a Director’s election exceeds the number of votes cast “against” that Director’s election. If an incumbent Director who has been nominated for re-election fails to receive a majority of the votes cast in an uncontested election, New York law provides that the Director continues to serve as a Director in a hold-over capacity. The Company’s By-Laws provide that, in such circumstances, the Director is required to promptly tender his or her resignation to the Board of Directors. The Board’s Nominating and Corporate Governance Committee is then required to make a recommendation to the Board as to whether to accept or reject the tendered resignation. The Board will act on the tendered resignation and will publicly disclose its decision and rationale within 90 days following certification of the election results. If a Director’s resignation is accepted by the Board, the Board may fill the vacancy or decrease the size of the Board. Abstentions and broker non-votes, if any, will not be counted either for or against the election of a Director nominee.

 

•

Item Two – The affirmative vote of the holders of a majority of the votes cast is required to approve, on an advisory non-binding basis, the executive compensation program for the Company’s named executive officers, as described in this Proxy Statement. Abstentions and broker non-votes, if any, will not be counted either for or against this proposal.

 

•

Item Three – The affirmative vote of the holders of a majority of the votes cast is required to ratify the selection of Ernst & Young LLP as our independent registered public accounting firm for 2018. Abstentions and broker non-votes, if any, will not be counted either for or against this proposal.

Who will count the vote?

Votes at the Annual Meeting will be counted by one or more independent inspectors of election appointed by the Board.

 

4				2018 Proxy Statement

GENERAL INFORMATION (continued)

 

How do I submit a shareholder proposal for the 2019 Annual Meeting?

The Company’s 2019 Annual Meeting is currently scheduled for May 8, 2019. There are three different deadlines for submitting shareholder proposals. First, if a shareholder wishes to have a proposal considered for inclusion in next year’s Proxy Statement, he or she must submit the proposal in writing so that we receive it by 5:00 p.m. (EDT) on November 19, 2018. Proposals should be addressed to the Corporate Secretary, c/o Office of the General Counsel, S&P Global Inc., 55 Water Street, New York, New York 10041-0003 or by sending an e-mail to the Corporate Secretary at corporate.secretary@spglobal.com. If you submit a proposal, it must comply with applicable laws, including Rule 14a-8 of the Securities Exchange Act of 1934.

On January 27, 2016, we amended our By-Laws to include a proxy access provision. The Company’s By-Laws now permit a shareholder, or group of up to 20 shareholders, owning continuously for at least three years shares of common stock representing an aggregate of at least 3% of our outstanding shares, to nominate and include in next year’s Proxy Statement director nominees constituting up to two individuals or 20% of the Company’s Board of Directors, whichever is greater, provided that the shareholder(s) and nominee(s) satisfy the requirements in the Company’s By-Laws. Notice of proxy access director nominees must be received no earlier than October 20, 2018, and no later than November 19, 2018.

In addition, the Company’s By-Laws provide that any shareholder wishing to nominate a candidate for Director or to propose any other business at the Annual Meeting, but not intending to have such nomination or business included in next year’s Proxy Statement, must give the Company written notice no earlier than January 1, 2019 and no later than January 31, 2019. This notice must comply with applicable laws and the Company’s By-Laws. Copies of the By-Laws are available to shareholders free of charge on request to the Corporate Secretary, c/o Office of the General Counsel, S&P Global Inc., 55 Water Street, New York, New York 10041-0003 or by sending an e-mail to the Corporate Secretary at corporate.secretary@spglobal.com. You may also download the By-Laws from the Corporate Governance section of the Company’s Investor Relations website at http://investor.spglobal.com.

May I view future proxy materials online instead of receiving them by mail?

Yes. Shareholders may provide their consent to electronic delivery of Proxy Statements and Annual Reports instead of receiving them by postal mail. If you elect this feature, you will receive an e-mail notice, which will include the web address for viewing the materials online. The e-mail notice will also include instructions so you can vote your proxy online or by telephone. If you have more than one account, you may receive separate e-mails for each account. Costs normally associated with electronic delivery, such as usage and telephone charges, as well as any costs incurred in printing documents, will be your responsibility.

During the 2018 proxy voting period, the Internet voting systems will automatically provide shareholders the option to consent to electronic delivery of future years’ materials.

During the year, shareholders may provide their consent to electronic delivery by going to the appropriate website:

 

•

Shareholders of record go to www.computershare.com/investor

•

Beneficial owners go to https://enroll.icsdelivery.com/spgi

•

Owners of shares through one of the Company’s 401(k) Savings and Profit Sharing Plans go to www.spglobalbenefits.com

What are the benefits of electronic delivery?

Electronic delivery benefits the environment and saves the Company money by reducing printing and mailing costs. It will also make it convenient for you to view your proxy materials and vote your shares online. If you have shares in more than one account, it is also an easy way to eliminate receiving duplicate copies of proxy materials.

 

		2018 Proxy Statement				5

GENERAL INFORMATION (continued)

 

What are the costs of electronic delivery?

The Company charges nothing for electronic delivery. You may, of course, incur expenses associated with Internet access such as telephone charges or charges from your Internet service provider.

How do I opt-out of electronic delivery?

At any time, shareholders may revoke their consent to electronic delivery and resume postal mail delivery of the Proxy Statement and Annual Report by going to the appropriate website:

 

•

Shareholders of record go to www.computershare.com/investor

•

Beneficial owners go to https://enroll.icsdelivery.com/spgi

•

Owners of shares through one of the Company’s 401(k) Savings and Profit Sharing Plans go to www.spglobalbenefits.com

What is “householding”?

We have adopted “householding,” a procedure under which beneficial owners who have the same address and last name and do not participate in electronic delivery of proxy materials will receive only one copy of our Annual Report and Proxy Statement unless one or more of these shareholders notifies us that they wish to continue receiving individual copies. This procedure reduces duplicate mailings and thus reduces our printing costs and postage fees.

Shareholders who participate in householding will continue to receive separate proxy cards. Householding does not affect dividend check mailings.

How do I request a separate paper or e-mail copy of the Proxy Statement or Annual Report at no charge?

If you wish to receive a separate paper or e-mail copy of the 2017 Annual Report or this Proxy Statement at no charge, please call us toll-free at (866) 436-8502, or send an e-mail to investor.relations@spglobal.com, or write to: Investor Relations, S&P Global Inc., 55 Water Street, New York, New York 10041-0003. We will promptly deliver to you the documents you requested. Please make your request for documents on or before April 17, 2018 to facilitate timely delivery of the documents to you prior to the Annual Meeting.

Where can I find the voting results?

We expect to announce preliminary voting results at the Annual Meeting. We will also publish voting results in a Form 8-K, which we will file with the SEC on or before May 7, 2018. To view this Form 8-K online, log on to the Company’s Investor Relations website at http://investor.spglobal.com, and click on the SEC Filings link.

Can shareholders and other interested parties communicate directly with our Board? If so, how?

Yes. You may communicate directly with one or more members of the Board by writing to the Corporate Secretary, c/o Office of the General Counsel, S&P Global Inc., 55 Water Street, New York, New York 10041-0003, or by sending an e-mail to the Corporate Secretary at corporate.secretary@spglobal.com. The Corporate Secretary will then forward all questions or comments directly to our Board or a specific Director, as the case may be, unless such questions or comments are considered, in the reasonable judgment of the Corporate Secretary to be inappropriate for submission to the intended recipient(s).

 

6				2018 Proxy Statement

BOARD OF DIRECTORS AND CORPORATE GOVERNANCE

 

BOARD OF DIRECTORS AND CORPORATE GOVERNANCE

The Company’s business and affairs are overseen by our Board pursuant to the New York Business Corporation Law and our Restated and Amended Certificate of Incorporation and By-Laws. We currently have 12 Directors who are all being nominated at this Annual Meeting for one-year terms, which will expire at the Annual Meeting in 2019. (See Item 1 on page 92.)

Governance Highlights

 

Accountability				Board Independence and Refreshment				Compensation and Risk Management
Annual elections for directors.				Independent Chairman of the Board.				Equity Ownership Requirements for directors and executive officers.
Majority voting in uncontested director elections.				All nominees except our CEO are independent.				“Double trigger” vesting of equity-based awards upon a change in control.
Special meeting rights for shareholders holding 25% or more of the voting stock.				Executive sessions of independent directors every Board meeting.				Pay recovery policy or “clawback” applicable to executives and employees under Company policy and S&P Global Ratings policy.
Proxy access right for a shareholder or a group of up to 20 shareholders holding at least 3% of our outstanding shares for at least three years to nominate up to two directors or 20% of the Board, whichever is greater.				Our nominees have an average tenure of 6.5 years and half of our nominees have been members of the Board for five years or less.				Anti-hedging and anti-pledging policy for directors and executive officers.
Annual performance evaluations of the Board and each committee.				Retirement age prevents directors from standing for re-election after reaching age 72.				Risk oversight, including succession planning, by the Board and committees.

Snapshot: Board of Directors

 

 

 

		2018 Proxy Statement				7

BOARD OF DIRECTORS AND CORPORATE GOVERNANCE (continued)

 

Enhanced Corporate Governance Environment

The Board of Directors has taken a series of actions designed to enhance the Company’s corporate governance environment. The Company’s current corporate governance structure reflects an ongoing commitment to strong and effective governance practices and a willingness to be responsive and accountable to shareholders. We regularly assess and refine our corporate governance policies and procedures to take into account evolving best practices and the interest of our shareholders. Our corporate governance structure includes:

Board Structure and Independence

ü

Board Independence. All of the Company’s director nominees are independent, with the exception of our CEO, who is the only member of management serving on the Board.

 

ü

Independent Chairman. The Company currently maintains separate roles of chief executive officer and chairman of the Board. An independent director acts as chairman of the Board. In the future, if the chairman is not an independent director, our Corporate Governance Guidelines require that an independent director be designated as presiding director.

 

ü

Independent Committee Chairs. Each of the Committees of the Board is led by an independent Director.

 

ü

Executive Sessions. The independent directors of the Board meet in executive session led by the independent chairman of the Board at every regularly scheduled Board meeting.

Board Diversity and Refreshment

ü

Board Membership. Since 2016, we have added four new independent directors who have brought valuable and varied experience in distinct and critical areas, each providing a fresh perspective to our Board. Their appointments underscore the Company’s commitment to inviting diverse backgrounds, perspectives, skills and experience into the Boardroom to guide the growth and performance of the Company.

 

ü

Board Skills. Throughout 2016, the Nominating and Corporate Governance Committee undertook a comprehensive review of the skills and qualifications of the Board, and the critical skills necessary to guide the Company forward. In 2016 and 2017, we added important skills to our Board in the areas of technology, international operations and commodity markets.

 

ü

Diversity. We believe that diversity is an important attribute of a well-functioning Board. While diversity can be measured in many ways, we note that our 12 Director nominees include four women and two African-Americans.

 

ü

Offer to Resign upon Change in Circumstances. Pursuant to our Corporate Governance Guidelines, any director undergoing a significant change in personal or professional circumstances must offer to resign from the Board.

 

ü

Retirement Age. Pursuant to our Corporate Governance Guidelines, directors cannot stand for re-election after reaching the age 72.

 

ü

Board Tenure. Since 2011, we have reduced the average tenure of our Board from 11.3 years to 6.5 years.

Election of Directors / Accountability to Shareholders

ü

Annual Election of Directors. The Company’s charter provides for the annual election of directors.

 

ü

Majority Voting in Director Elections. The Company’s By-Laws provide that in uncontested elections, director candidates must be elected by a majority of the votes cast. In uncontested director elections, a director who does not receive a majority of the votes cast must offer to submit his or her resignation for consideration.

 

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ü

Shareholder Right to Call Special Meetings. The Company’s By-Laws allow shareholders of record of twenty-five percent (25%) or more of the voting power of the Company’s outstanding common stock to call a special meeting.

 

ü

Annual Self-Evaluation. The Board conducts an annual self-evaluation of Board and committee performance and the Nominating and Corporate Governance Committee reports the results to the Board, including its assessment of the Board’s and the committees’ effectiveness and areas for improvement.

Shareholder Recommendations / Proxy Access

ü

Shareholder Recommendations. Shareholders can submit recommendations of director candidates for consideration by the Nominating and Corporate Governance Committee.

 

ü

Proxy Access. A shareholder, or group of up to 20 shareholders, owning continuously for at least three years shares of common stock representing an aggregate of at least 3% of our outstanding shares, may nominate and include in the Company’s Proxy Statement director nominees constituting up to two individuals or 20% of the Company’s Board of Directors, whichever is greater.

Management Succession Planning

ü

Succession Planning. The Board believes that one of its primary responsibilities is to oversee the development and retention of executive talent and to ensure that an appropriate succession plan is in place for our Chief Executive Officer and other members of management. Based on feedback from the Board’s self-evaluation last year, greater focus has been brought to bear on the development of succession planning, including emergency Chief Executive Officer succession planning, at the Board and Committee level. Additional information can be found beginning on page 13 of this Proxy Statement.

 

ü

Board Talent Agenda. In 2017, the full Board reviewed specific talent management topics as standing agenda items at four out of eight of its scheduled in-person meetings.

Compensation Practices

ü

“Double-Trigger” Condition for Vesting of Equity-Based Awards upon a Change in Control. Awards granted under the Company’s 2002 Stock Incentive Plan after December 31, 2014 are subject to “double-trigger” treatment in the case of a change-in-control. Additional information can be found in our Compensation Discussion and Analysis section, beginning on page 35 of this Proxy Statement.

 

ü

Pay Recovery Policy. The Company may recover (or “clawback”) cash incentive and long-term incentive award payments received by covered active and former employees and executives under various circumstances, including misconduct and financial restatements, under the applicable Company policy and S&P Global Ratings policy. Additional information can be found beginning on page 66 of this Proxy Statement.

Equity Ownership Requirements

ü

Senior Executive Equity Ownership Requirements. The Company maintains equity ownership standards requiring senior management to hold shares or stock units of our common stock with a value equal to a multiple of base salary. Unless the Compensation and Leadership Development Committee determines that a financial hardship exception applies, until the guidelines for ownership levels are attained, senior executives must retain 100% of the net shares received (after payment of taxes and any exercise price) upon the exercise of stock options, the payment of PSU and RSU awards and the vesting of any restricted stock awards. Additional information can be found on page 65 of this Proxy Statement.

 

ü

Director Equity Ownership Requirements. Each Director is required to hold 400 shares of the Company’s common stock within 90 days of his or her election to the Board and to hold such shares through his or her tenure as a Director. Additionally, under the Company’s Non-Employee Director Stock Ownership Guidelines, each non-employee Director is required to own or acquire, within five years of election to the Company’s Board of Directors, shares of common stock of the Company having a market value of at least five times the annual cash retainer for serving as a Director of the Company. Additional information can be found on page 87 of this Proxy Statement.

 

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BOARD OF DIRECTORS AND CORPORATE GOVERNANCE (continued)

 

ü

Policy Prohibiting Hedging and Pledging. The Company’s Insider Trading Policy prohibits the hedging and pledging of Company stock by executive officers, other designated employees and directors without exception.

Corporate Governance Materials

The following corporate governance materials are available and can be viewed and downloaded from the Corporate Governance section of the Company’s Investor Relations website at http://investor.spglobal.com:

 

•

the Company’s Amended and Restated Certificate of Incorporation;

 

•

the Company’s By-Laws;

 

•

the Company’s Corporate Governance Guidelines;

 

•

Board Committee Charters for the Company’s Audit, Compensation and Leadership Development, Executive, Financial Policy and Nominating and Corporate Governance Committees;

 

•

the Code of Business Ethics applicable to all Company employees;

 

•

the Code of Ethics applicable to the Company’s Chief Executive Officer and Senior Financial Officers;

 

•

the Code of Business Conduct and Ethics for Directors applicable to all the Company’s Directors; and

 

•

the Audit Committee’s Policy concerning Employee Complaint Procedures Regarding Accounting and Auditing Matters.

Director Independence

The Board has determined that all of the Company’s current Directors, with the exception of Mr. Douglas L. Peterson (the Company’s President and Chief Executive Officer), have met the independence requirements of the New York Stock Exchange based upon the application of objective categorical standards adopted by the Board. To be considered independent, a Director must have no material relationship (other than as a Director) with the Company, or any of its subsidiaries, either directly or as a partner, shareholder or officer of an organization that has a material relationship with the Company or any of its subsidiaries. In making independence determinations, the Board broadly considers all relevant facts and circumstances.

In addition, members of the Audit Committee must also satisfy the SEC and NYSE independence requirements, which provide that they may not be affiliates and may not accept directly or indirectly any consulting, advisory or other compensatory fee from the Company or any of its subsidiaries, other than their directors’ compensation. The Board evaluated each member of the Compensation Committee under the additional SEC and NYSE compensation committee member standards and also determined that these members qualify as “non-employee directors” (as defined under Rule 16b-3 under the Securities Exchange Act of 1934) and as “outside directors” (as defined in Section 162(m) of the Internal Revenue Code).

Additional Information Regarding Director Independence

In making its independence determinations with respect to our Directors, the Board considered the following transactions that the Company engages in from time to time with organizations in which our independent Directors serve as executive officers or otherwise have a material interest:

 

•

Cisco Systems, Inc. Ms. Rebecca Jacoby served as the Senior Vice President of Operations at Cisco Systems, Inc. until her retirement in January 2018, after a 22-year career at Cisco Systems, Inc., and will continue to provide advisory services through May 2018. Cisco Systems, Inc. provides the Company and its divisions with network and telecommunications equipment and services from time to time. The Company and its divisions provide the following types of products and services from time to time to Cisco Systems, Inc.: credit ratings services, index services and data subscriptions and licensing of publications.

 

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•

Lockheed Martin Corporation. Ms. Stephanie C. Hill is the Senior Vice President for Corporate Strategy and Business Development at Lockheed Martin Corporation. The Company and its divisions provide the following types of products and services from time to time to Lockheed Martin Corporation: credit ratings services, index services and data subscriptions and licensing of publications.

 

•

MetLife, Inc. Ms. Maria R. Morris served as the Executive Vice President leading MetLife, Inc.’s Global Employee Benefits business from 2011 until her retirement in September 2017. The Company and its divisions provide the following types of products and services from time to time to MetLife, Inc.: credit ratings services, index services and data subscriptions and licensing of publications.

 

•

Snam S.p.A. Mr. Marco Alverà is the Chief Executive Officer of Snam S.p.A. The Company and its divisions provide the following types of products and services from time to time to Snam S.p.A.: credit ratings services.

All of these transactions are entered into in the ordinary course of business and on terms that are substantially equivalent to those prevailing at the time for comparable transactions with other similarly situated customers or vendors of the Company. None of the transactions described above exceeds 1% of the Company’s consolidated revenue or that of such other company.

In making its independence determinations with respect to our Directors, the Board reviews the materiality of these transactions not only from the standpoint of the applicable Director but also from the standpoint of the organizations in which they serve. Based on this review, the Board has concluded that these transactions do not interfere with the ability of each such Director to exercise independent judgment in carrying out his or her Board responsibilities.

Annual Meeting Attendance

It is the Company’s policy that, subject to illness or an unavoidable schedule conflict, all Directors will attend and be introduced at the Annual Meeting. All of our Directors attended the 2017 Annual Meeting, other than Ms. Monique Leroux due to a pre-existing commitment made prior to her appointment as a Director.

Leadership Structure of the Board of Directors

The Company’s Corporate Governance Guidelines provide that the Board shall select annually the Chairman of the Board based upon such criteria as the Company’s independent Nominating and Corporate Governance Committee recommends and what the Directors believe to be in the best interests of the Company at a given point in time. This process shall include consideration of whether the roles of Chairman and Chief Executive Officer should be combined or separated based upon the Company’s needs and the strengths and talents of its executives at any given time.

Although the Board regularly considers and is open to different structures as circumstances may warrant, the Board believes that it is in the best interests of the Company and its shareholders at this time that the positions of Chairman and Chief Executive Officer be held by separate individuals. The Board believes that this leadership structure will continue to assure the appropriate level of management oversight and independence for the Company. In the future, if the Chairman is not an independent director, our Corporate Governance Guidelines require that an independent director be designated as presiding director to lead the executive sessions of the independent directors at Board meetings, consult on committee selection, and communicate the annual evaluation of the Chief Executive Officer, together with the Chairman of the Compensation and Leadership Development Committee. In addition, each of the Committees of the Board is led by an independent Director acting as the Committee chair.

Mr. Charles E. Haldeman is currently the Board’s independent chairman. The only member of management who serves on the Board is Mr. Douglas L. Peterson, the Company’s President and Chief Executive Officer. The

 

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BOARD OF DIRECTORS AND CORPORATE GOVERNANCE (continued)

 

position of Chairman of the Board has been held by an independent director since 2015. The Board will continue to periodically evaluate whether the structure is in the best interests of shareholders.

 

Independent Chairman Role

ü    Approves agendas for Board meetings.   ü    Serves as a liaison and facilitates dialogue between independent directors and the Chief Executive Officer.   ü    Keeps independent directors informed between Board meetings.   ü    Leads annual evaluations of the Chief Executive Officer with the Chair of the Compensation and Leadership Development Committee.   ü    Oversees the Nominating and Corporate Governance Committee’s administration of annual Board and Director evaluations.   ü    Chairs executive sessions of independent directors.

Role of Board of Directors in Risk Oversight

The Board has oversight responsibility for the Company’s risk management framework, which is designed to identify, measure, assess, prioritize, mitigate, monitor and communicate risks across the Company’s operations, and foster a corporate culture of integrity and risk awareness.

 

 

 

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BOARD OF DIRECTORS AND CORPORATE GOVERNANCE (continued)

 

Audit Committee

The Audit Committee considers the Company’s top risks identified from the risk management process as well as risks related to operations and financial reporting and internal controls, and compliance with laws and regulations. The Committee discusses with management, the Company’s chief risk and audit executive, and the Company’s independent external auditor: (a) the Company’s enterprise risk management process, including its risk governance framework; (b) the key risk exposures facing the Company; (c) the steps management has taken to monitor and mitigate such risks; and (d) the adequacy of internal controls that could significantly affect the Company’s financial statements.

Compensation and Leadership Development Committee

The Compensation and Leadership Development Committee considers risks related to compensation policies and practices and incentive-related risks. The Committee establishes performance metrics that reward our executives for creating shareholder value, and establishes goals and payment schedules for each metric that are designed to provide a balance to motivate the achievement of the established goals without the need for inappropriate or excessive risk taking. In addition, the Committee reviews and assesses plan design, performance metrics, and goals for the annual incentive plans within the Company’s divisions to ensure that their designs are appropriately aligned with business and regulatory considerations and do not encourage inappropriate or excessive risk taking. In conjunction with the Nominating and Corporate Governance Committee, the Committee is responsible for overseeing risks associated with the Company’s management of executive succession and works with the Chief Executive Officer to develop formal succession planning for senior management.

In 2018, management updated its prior review of the Company’s incentive compensation plans as well as the Company’s other compensation policies and practices regarding whether the Company’s compensation plans, programs and policies encourage excessive risk taking and determined that the Company’s compensation plans, programs and policies do not encourage excessive risk taking and are not reasonably likely to have a material adverse effect on the Company. Management then reviewed these findings with the Committee who concurred. Pay Governance LLC, the Committee’s independent compensation consultant, also advised the Committee on this matter and concurred in these findings and conclusions.

Financial Policy Committee

The Financial Policy Committee oversees financial risks, with particular emphasis on risks related to the Company’s financial position, its capital allocation philosophy, its dividend policy, its share repurchase policy, and its capital expenditure program, as well as the financing and post-completion performance of significant transactions, including acquisitions.

Nominating and Corporate Governance Committee

The Nominating and Corporate Governance Committee monitors risks related to the Company’s governance practices, including by reviewing and discussing emergency succession planning with the Chief Executive Officer, overseeing annual performance evaluations of the Board and its committees, evaluating director independence and related person transactions, and monitoring legal developments and trends regarding corporate governance matters.

Succession Planning

The Board believes that one of its primary responsibilities is to oversee the development and retention of executive talent and to ensure that an appropriate succession plan is in place for our Chief Executive Officer and other members of management.

 

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BOARD OF DIRECTORS AND CORPORATE GOVERNANCE (continued)

 

The Nominating and Corporate Governance Committee reviews with the Chief Executive Officer, on an annual basis, his recommendations concerning an emergency succession plan for him in the event of extraordinary circumstances such as his death or disability, as well as succession planning in general for the role of the Chief Executive Officer.

The Compensation and Leadership Development Committee oversees the process for succession planning for senior management positions from a talent management perspective. The Compensation and Leadership Development Committee holds a formal succession planning and talent review session annually which includes succession planning for all senior management positions, and the Chief Executive Officer presents an overview to the full Board. These talent review and succession planning discussions take into account desired leadership skills, key capabilities and experience in light of our current and evolving business and strategic direction. Our Directors also have exposure to leaders through Board and committee presentations and discussions, as well as informal events and interactions with key talent throughout the year. Further, the Compensation and Leadership Development Committee periodically reviews the overall composition, qualifications, tenure and experience of members of senior management. The Compensation and Leadership Development Committee reports on its succession planning efforts to the full Board, and the full Board reviews succession planning at least annually at a regularly scheduled Board meeting.

In 2017, the full Board reviewed specific talent management topics as standing agenda items at four out of eight of its scheduled in-person meetings.

Process for Identifying and Evaluating Directors and Nominees

The Nominating and Corporate Governance Committee reviews with the Board, on an annual basis, the appropriate skills and qualifications required of Board members. The Committee also recommends to the Board the general criteria for selection of proposed nominees for election as Directors and the slate of individuals who will constitute the nominees of the Board for election as Directors at each Annual Meeting. In addition to qualities of intellect, integrity and judgment, this assessment by the Committee takes into consideration diversity, background, senior management experience and an understanding of some combination of marketing, finance, technology, international business matters, government regulation, public policy and the global capital and commodity markets. The Committee evaluates the skills and qualifications of the existing Board and potential candidates on a continuing basis.

The Board is responsible for selecting all members of the Board and for recommending such members for election by the shareholders. The Board delegates the screening process to the Committee with direct input from the Chairman of the Board. The Committee evaluates all nominees for Director based on the above criteria, including nominees recommended by shareholders. Although the Committee considers diversity as a factor in assessing the appropriate skills and qualifications required of Board members, the Board does not have a formal policy with regard to diversity in identifying Director nominees. The Committee has sole authority to retain and terminate search firms to assist the Board in identifying and reviewing prospective Director nominees and to approve the fees and other retention terms of any such search firms.

 

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BOARD OF DIRECTORS AND CORPORATE GOVERNANCE (continued)

 

Specific Experience, Qualifications, Attributes and Skills of Directors

The Nominating and Corporate Governance Committee has reviewed with the Board the specific experience, qualifications, attributes and skills of each Director nominee standing for re-election as a Director at this Annual Meeting. The Committee has concluded that each Director nominee has the appropriate skills and qualifications required of Board membership and that each possesses an in-depth knowledge of the Company’s complex global businesses and strategy. The Committee further believes that our Board is composed of well-qualified and well-respected Directors who are prominent in business, finance, and the global capital and commodity markets. The experience and key competencies of each Director nominee, as reviewed and considered by the Committee, are discussed on pages 16 through 27 of this Proxy Statement.

 

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BOARD OF DIRECTORS AND CORPORATE GOVERNANCE (continued)

 

Director Nominees

The following 12 Director nominees are currently serving as Directors of the Company and have been nominated to stand for re-election at this Annual Meeting to serve one-year terms that will expire at the 2019 Annual Meeting. Set forth below is information regarding each of the 12 Director nominees. Please see pages 1 through 6 and page 92 of this Proxy Statement for voting information. Following each Director nominee’s biography below, we have highlighted certain notable skills and qualifications that the Nominating and Corporate Governance Committee reviewed and considered when recommending the Director nominee. Committee membership is identified for the one-year term expiring at the 2018 Annual Meeting.

 

				MARCO ALVERÀ
Director Since: 2017                                          Board Committees: Financial Policy Nominating and Corporate Governance				Marco Alverà, age 42, is the Chief Executive Officer of Snam S.p.A., Europe’s leading natural gas utility. He served as Chairman of the board of Snam Rete Gas until November 2017. Prior to joining Snam in 2016, Mr. Alverà held a number of senior leadership positions at Eni S.p.A., among them, Head of Eni’s commodities trading and shipping business. He has participated in the upstream, midstream and downstream aspects of the oil and gas industry. Prior to Eni S.p.A., Mr. Alverà served as Head of Group Strategy at Enel S.p.A., a multinational power company functioning in the gas and electricity sectors, particularly in Europe and Latin America. He also served as Chief Financial Officer of Wind Telecomunicazioni S.p.A. and co-founded Netesi, Italy’s first broadband ADSL company. Mr. Alverà started his career at Goldman Sachs. He also sits on the board of the Cini Foundation in Venice and previously served on the board of Gazprom Neft, a Russian integrated oil company. Mr. Alverà is also a frequent speaker and lecturer on business, sustainability, and the energy transition.
				Skills and Qualifications   We believe Mr. Alverà’s qualifications to sit on our Board of Directors include his expertise in the commodity markets, his background in strategy and corporate finance, as well as his executive leadership and management experience acquired throughout his career in the energy industry.

 

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BOARD OF DIRECTORS AND CORPORATE GOVERNANCE (continued)

 

				WILLIAM D. GREEN
Director Since: 2011                                          Board Committees: Compensation and Leadership Development (Chair) Executive Nominating and Corporate Governance				William D. Green, age 64, is the former CEO and Chairman of Accenture, a global management consulting and technology services company. He served as Accenture’s Chief Executive Officer from September 2004 through December 2010 and assumed the additional role of Chairman from 2006-2013. Mr. Green was a Director of Accenture from 2001 through January 2013. Prior to serving as Chief Executive Officer, Mr. Green was Accenture’s Chief Operating Officer-Client Services with overall management responsibility for the company’s operating groups and in addition, he served as Group Chief Executive of the Communications and High Tech operating group from 1999 to 2003. He was also Group Chief Executive of the Resources operating group for two years. Earlier in his career, Mr. Green led the Manufacturing industry group and was Managing Director for Accenture’s business in the United States. He joined Accenture in 1977 and became a partner in 1986. Mr. Green served as a Director of EMC Corporation from July 2013 to August 2016 and as EMC’s independent Lead Director from February 2015 to August 2016. Mr. Green is now a Director of Dell Technologies (following completion of its merger with EMC) and several other private companies. He is currently Co-CEO and Chairman of the board of GTY Technology Holdings and serves on the boards of Inovalon and Akamai Technologies. He is also on the National Board of Year Up. Mr. Green is deeply involved in many other organizations and business groups supporting education in the United States and around the world. He is also a frequent speaker at business, technology and academic forums worldwide.
				Skills and Qualifications   We believe Mr. Green’s qualifications to sit on our Board of Directors and Chair our Compensation and Leadership Development Committee include his extensive leadership and management experience gained as the chief executive of a global professional services company providing a range of strategy, consulting, digital, technology and operations services and solutions and his deep understanding of the information technology industry.

 

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BOARD OF DIRECTORS AND CORPORATE GOVERNANCE (continued)

 

				CHARLES E. HALDEMAN, JR.
Director Since: 2012                                        Board Committees: Executive (Chair) Financial Policy Nominating and Corporate Governance				Charles E. Haldeman, Jr., age 69, has been the Non-Executive Chairman of the Company since April 2015. Since November 2014, he has served on the Board of DST Systems, Inc., which provides technology-based information processing and servicing solutions to the financial services and healthcare industries. He has served as Trustee of JBG Smith, the largest publicly traded real estate company focused on the Washington, D.C. market since July 2017. He was also the Non-Executive Chairman of KCG Holdings, Inc., an independent securities firm focused on market making and electronic trading, from November 2013 until the company’s acquisition by Virtu Financial in July 2017. He is the former CEO of Freddie Mac, the publicly traded mortgage company. He joined Freddie Mac in 2009 and stepped down as Chief Executive in 2012. Before joining Freddie Mac, he was Chairman of Putnam Investment Management, LLC and served as President and CEO of Putnam Investments from 2003 through 2008. Prior to his tenure at Putnam, he was Chairman and CEO of Delaware Investments and earlier served as President and Chief Operating Officer of United Asset Management Corporation. He holds a Chartered Financial Analyst® (CFA®) designation. He was Chairman of the Board of Trustees of Dartmouth College from 2007 through 2010, and served as a Trustee from 2004 through 2012.
				Skills and Qualifications   We believe Mr. Haldeman’s qualifications to Chair our Board of Directors include his years of executive experience as a chief executive in the financial services industry, together with his financial expertise and his background in investments and the capital markets, which provide our Board with insight into important areas in which the Company conducts business.

 

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BOARD OF DIRECTORS AND CORPORATE GOVERNANCE (continued)

 

				STEPHANIE C. HILL
Director Since: 2017                                          Board Committees: Audit Compensation and Leadership Development				Stephanie C. Hill, age 53, is Senior Vice President of Corporate Strategy and Business Development of Lockheed Martin. Since joining Lockheed Martin in 1987 as a software engineer, Ms. Hill has held positions of increasing responsibility including: Vice President & General Manager of Cyber, Ships & Advanced Technologies; Vice President & General Manager of Information Systems & Global Solutions Civil business; Vice President of Corporate Internal Audit; and Vice President & General Manager of the Electronic Systems Mission Systems & Sensors business. Ms. Hill sits on the Board of Directors for Project Lead the Way, the nation’s leading provider of K-12 Science, Technology, Engineering and Mathematics (STEM) programs, and also serves on the Board of Visitors for the University of Maryland, Baltimore County. Ms. Hill has been recognized for her career achievements and community outreach, especially in the advancement of STEM education. In 2018, Black Enterprise named Ms. Hill as one of the “most powerful executives in corporate America.” She was recognized as one of Computerworld’s 2015 Premier 100 IT Leaders and one of Maryland’s 19th Annual International Leadership Awardees by the World Trade Center Institute. In 2014, Ms. Hill was named the U.S. Black Engineer of the Year by Career Communications Group and included on EBONY Magazine’s Power 100 list, recognizing the achievements of African-Americans in a variety of fields. Ms. Hill graduated with high honors from the University of Maryland, Baltimore County with a Bachelor of Science degree in Computer Science and Economics; the university also recognized her with an honorary doctorate in 2017.
				Skills and Qualifications   We believe Ms. Hill’s qualifications to sit on our Board of Directors include her exceptional and consistent business and community leadership and technical experience, as well as her experience working with the government on issues of critical importance and her leadership in corporate governance.

 

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BOARD OF DIRECTORS AND CORPORATE GOVERNANCE (continued)

 

				REBECCA JACOBY
Director Since: 2014                                          Board Committees: Financial Policy				Rebecca Jacoby, age 56, was Senior Vice President, Operations of Cisco Systems, Inc., a worldwide leader in IT networking, until her retirement in January, 2018. She was promoted to the role in July 2015 and was responsible for driving profitable growth and enabling operational excellence. Ms. Jacoby oversaw the supply chain, global business services, security and trust, and IT organizations. In her former role as Cisco’s CIO from 2006 to 2015, she made the Cisco IT organization a strategic business partner, producing significant business value for Cisco in the form of financial performance, customer satisfaction and loyalty, market share, and productivity. Known for her strong track record of operational excellence, innovative problem solving and talent development, Ms. Jacoby was inducted into the CIO Hall of Fame by CIO magazine and was recognized by Forbes as a “Superstar CIO” in 2012. Her extensive understanding of business operations, infrastructure and application deployments, as well as her knowledge of products, software and services helped her advance Cisco’s business through the use of Cisco technology. Since joining Cisco in 1995, Ms. Jacoby has held a variety of leadership roles in operations, manufacturing and IT. Prior to joining Cisco, Ms. Jacoby held a range of planning and operations positions with other companies in Silicon Valley. Ms. Jacoby serves on the Board of the Second Harvest Food Bank of Santa Clara and San Mateo Counties and is a founding member of the Technology Business Management Council.
				Skills and Qualifications   We believe Ms. Jacoby’s qualifications to sit on our Board of Directors include her technology expertise, including an understanding of infrastructure and application deployments, products, software and services, as well as her executive leadership and operational experience.

 

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				MONIQUE F. LEROUX
Director Since: 2016                                          Board Committees: Audit Compensation and Leadership Development				Monique F. Leroux, age 63, is Chair of the board of lnvestissement Quebec and Chair of the Quebec Economic and Innovation Council, appointed by the Quebec government. She is a member of the Canada-United States Council for Advancement of Women Entrepreneurs and Business Leaders. From March 2008 to April 2016, Ms. Leroux was the Chair of the Board, President and Chief Executive Officer of Desjardins Group, the leading cooperative financial group in Canada. From 2015 to 2017, Ms. Leroux was the President of the International Cooperative Alliance (ICA), a global organization representing over 2.5 million enterprises and generating over $3,000 billion in revenue in more than 100 countries. Before joining Desjardins Group in 2001, Ms. Leroux held positions as the Chief Operating Officer at Quebecor Inc., Senior Vice President of Finance and Senior Vice President Quebec at RBC (Royal Bank) and Partner at Ernst & Young. Ms. Leroux is Fellow of the Institute of Corporate Directors. She serves on the Boards of Alimentation Couche-Tard, Michelin and BCE. She is also Strategic Advisor at Fiera Capital. She is an Officer of the Ordre National du Quebec and a Chevalier of the Legion d’Honneur (France). She is also the recipient of the Woodrow Wilson Award (United States), the Outstanding Achievement Award from the Quebec CPA Order and the Institute of Corporate Directors Fellowship Award. She holds honorary doctorates from eight Canadian universities.
				Skills and Qualifications   We believe Ms. Leroux’s qualifications to sit on our Board of Directors include her executive experience in financial services, particularly internationally, together with her financial expertise, experience managing complex organizations and her corporate governance experience from prior board service.

 

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BOARD OF DIRECTORS AND CORPORATE GOVERNANCE (continued)

 

				MARIA R. MORRIS
Director Since: 2016                                          Board Committees: Audit Financial Policy				Maria R. Morris, age 55, served on MetLife’s Executive Group for almost a decade (retired September 2017), holding numerous senior leadership positions throughout her 33-year career. From 2011 through her retirement, Ms. Morris was Executive Vice President, MetLife, Inc. and led the Company’s Global Employee Benefits (GEB) business. In her role leading MetLife’s GEB business since 2012, Ms. Morris was responsible for expanding MetLife’s employee benefits business in more than 40 countries, broadening relationships and fueling growth across the globe via local solutions and partnerships with multinational corporations, as well as through distribution relationships with financial institutions. She also served as the interim Head of MetLife’s U.S. Business from January 2016 to June 2017. In her interim role as Head of the U.S. Business, Ms. Morris was responsible for approximately 60% of MetLife’s operating earnings, post separation of its retail business. She served as MetLife’s Interim Chief Marketing Officer in 2014, where she continued to strengthen MetLife’s brand across the globe. From 2008 to 2011, Ms. Morris led Global Technology and Operations, where she managed a $1.6 billion IT portfolio and a $2.5 billion procurement and real estate budget. She also oversaw the integration of MetLife’s $16.4 billion acquisition of American Life Insurance Company (Alico). In addition to her executive roles, Ms. Morris has served on the boards of MetLife Property and Casualty Insurance Company, the MetLife Foundation, the American Council of Life Insurers and various New York based nonprofits. As of January 1, 2018, Ms. Morris joined the Board of Directors of Wells Fargo & Company and is a member of the Risk Committee, Risk Technology Sub Committee and the Human Resources Committee.
				Skills and Qualifications   We believe Ms. Morris’s qualifications to sit on our Board of Directors include her executive leadership and management experience in the financial services industry, her technology expertise and her experience in growing a multinational company across more than 40 countries.

 

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BOARD OF DIRECTORS AND CORPORATE GOVERNANCE (continued)

 

				DOUGLAS L. PETERSON
Director Since: 2013                                          President and Chief Executive Officer   Board Committees: Executive				Douglas L. Peterson, age 59, was elected President and Chief Executive Officer of S&P Global, effective November 2013, and he joined the Company in September 2011 as President of Standard & Poor’s Ratings Services. Previously, Mr. Peterson was the Chief Operating Officer of Citibank, N.A., Citigroup’s principal banking entity that operates in more than 100 countries. Mr. Peterson was with Citigroup for 26 years, during which time he led diversified businesses in investment and corporate banking, brokerage, asset management, private equity and retail banking. His prior roles include CEO of Citigroup Japan, Chief Auditor of Citigroup, and Country Manager for Costa Rica and Uruguay. Mr. Peterson is a Steward of the World Economic Forum’s (WEF) Shaping the Future of Long-Term Investing, Infrastructure and Development System and a member of WEF’s Financial Services Governors Community. He serves on the Advisory Boards of the Federal Deposit Insurance Corporation’s Systemic Resolution Advisory Committee, the US-China Business Council, the Partnership for New York City and the Kravis Leadership Institute, and the Boards of Trustees of Claremont McKenna College and the Paul Taylor Dance Company. Mr. Peterson received an MBA from the Wharton School at the University of Pennsylvania and an undergraduate degree in mathematics and history from Claremont McKenna College.
				Skills and Qualifications   As the only member of the Company’s management team on the Board, Mr. Peterson’s presence on the Board provides Directors with direct access to the Company’s chief executive officer and helps facilitate Director contact with other members of the Company’s senior management.

 

		2018 Proxy Statement				23

BOARD OF DIRECTORS AND CORPORATE GOVERNANCE (continued)

 

				SIR MICHAEL RAKE
Director Since: 2007                                          Board Committees: Audit (Chair) Executive Financial Policy				Sir Michael Rake, age 70, is Chairman of Worldpay Group plc (formerly RBS Worldpay), a UK based global payment processing company and Chairman of Phoenix Global Resources plc (formerly Andes Energia), an oil, natural gas, and petroleum exploration and production company. He has also been Chairman of Majid Al Futtaim Holding LLC since 2010 and has been Chairman of the International Chamber of Commerce (ICC) in the UK, since 2015. Previously, he served as Chairman of BT Group plc, one of the largest communications companies in the world, from 2007 through 2017. He was also Chairman of KPMG International, one of the world’s leading accounting organizations, with operations in 148 countries and more than 113,000 professionals working in member firms worldwide. After joining KPMG in 1972, he served the company in various capacities in Belgium, Luxembourg, the Middle East and London, and led a number of major global clients’ services teams. He joined the company’s UK Board in 1991, was elected UK Senior Partner in 1998 and named International Chairman in 2002. Sir Michael is the former Chair of the Commission for Employment and Skills in the UK and was Chairman of easyJet plc from 2010 to May 31, 2013. Sir Michael was Non-Executive Director (2008-2012) then Deputy Chairman at Barclays plc (2012-2015). He was President of the Confederation of British Industry until July 2015 and was formerly on the Board of the Financial Reporting Council. He is a member of the Advisory Council for Business for New Europe, on the Board of the Trans-Atlantic Business Council and is a William Pitt Fellow at Pembroke College, Cambridge. He is also a Senior Adviser for Chatham House, a member of the Oxford University Centre for Corporate Reputation Global Advisory Board, and Vice President of the Royal National Institute of Blind People (RNIB). Educated at Wellington College, where he was formerly Chairman of Governors and Vice President, Sir Michael is qualified as a UK chartered accountant. He was knighted in 2007.
				Skills and Qualifications   We believe Sir Michael’s qualifications to sit on our Board of Directors and Chair our Audit Committee include his executive leadership and management experience, his expertise in financial accounting and corporate finance, his extensive international business experience and his overall knowledge of global markets.

 

24				2018 Proxy Statement

BOARD OF DIRECTORS AND CORPORATE GOVERNANCE (continued)

 

				EDWARD B. RUST, JR.
Director Since: 2001                                          Board Committees: Nominating and Corporate Governance (Chair) Compensation and Leadership Development Executive				Edward B. Rust, Jr., age 67, is Chairman Emeritus of State Farm Mutual Automobile Insurance Company, the largest insurer of automobiles and homes in the United States. Mr. Rust was CEO of State Farm Mutual Automobile Insurance Company from 1985 to September 2015. He was a Director of the following State Farm affiliates from 2001 to 2014: State Farm Associates Funds Trust; State Farm Mutual Fund Trust; and State Farm Variable Product Trust. Mr. Rust is also a Director of Helmerich & Payne, an oil and gas drilling company, and Caterpillar Inc., a manufacturer of construction and mining equipment. Mr. Rust is a Trustee of The Conference Board and Illinois Wesleyan University. Additionally, he was formerly Chairman of the U.S. Chamber of Commerce, the American Enterprise Institute, the National Alliance of Business, the Insurance Institute for Highway Safety, the Business-Higher Education Forum and the Business Roundtable’s Education Initiative. Mr. Rust was a member of Business Roundtable, where he served as Co-Chair for more than seven years, and the Financial Services Roundtable, where he served as Chairman. He was also a member of President George W. Bush’s Transition Advisory Team Committee on Education, served on the National (Glenn) Commission on Mathematics and Science Teaching for the 21st Century and on the No Child Left Behind Commission.
				Skills and Qualifications   We believe Mr. Rust’s qualifications to sit on our Board of Directors and Chair our Nominating and Corporate Governance Committee include his extensive leadership experience gained as the chief executive of a large mutual company in the insurance industry and his broad corporate governance experience from prior board service.

 

		2018 Proxy Statement				25

BOARD OF DIRECTORS AND CORPORATE GOVERNANCE (continued)

 

				KURT L. SCHMOKE
Director Since: 2003                                          Board Committees: Compensation and Leadership Development Nominating and Corporate Governance				Kurt L. Schmoke, age 68, was appointed President of the University of Baltimore in July 2014, after serving at Howard University for almost 12 years. During his tenure at Howard University, Mr. Schmoke served in several roles: Dean of Howard Law School (2003-2012); General Counsel (2012-2014); and Interim Provost (2013-2014). Prior to joining Howard, he was a partner at the Washington, D.C.-based law firm of Wilmer Cutler & Pickering from 2000 through 2002. Mr. Schmoke served three terms as the Mayor of Baltimore from 1987 until 1999. Mr. Schmoke served as the State’s Attorney for Baltimore City from 1982 until 1987. Mr. Schmoke is a Director of Legg Mason, Inc. He is also Chair of the Board of Trustees of Howard Hughes Medical Institute, a private philanthropic group, and the Baltimore City Community College. Mr. Schmoke is also a member of the Council on Foreign Relations. Mr. Schmoke was named to President Jimmy Carter’s domestic policy staff in 1977. He was a Director of the Baltimore Life Companies and a Trustee of the Yale Corporation.
				Skills and Qualifications   We believe Mr. Schmoke’s qualifications to sit on our Board of Directors include his experience in managing large and complex educational institutions, which provides the Board with a diverse approach to management, as well as his public policy expertise acquired through his government service as an elected official.

 

26				2018 Proxy Statement

BOARD OF DIRECTORS AND CORPORATE GOVERNANCE (continued)

 

				RICHARD E. THORNBURGH
Director Since: 2011                                          Board Committees: Audit Executive Financial Policy (Chair)				Richard E. Thornburgh, age 65, is Non-Executive Director and Chairman of Credit Suisse Holdings (USA), Inc. He is also Vice Chairman of the Board of Credit Suisse Group A.G. and chairs its Risk Committee. Mr. Thornburgh has held key positions throughout his career with Credit Suisse First Boston (CSFB), the investment banking arm of Credit Suisse Group A.G., including Executive Vice Chairman of CSFB from 2004 through 2005. He has also held key positions with Credit Suisse Group A.G., including Chief Financial Officer, Chief Risk Officer and member of the Executive Board of Credit Suisse Group A.G. Mr. Thornburgh was the Lead Director of NewStar Financial, Inc. until its sale in December 2017. He serves as a Director of CapStar Financial Holdings (CSTR). Mr. Thornburgh was previously Vice Chairman of Corsair Capital LLC, a private equity firm focused on investing in the global financial services industry, and continues to serve as a member of Corsair’s Private Equity Funds’ Investment Committee. He was previously a Director of Reynolds American Inc., National City Corporation and Dollar General Corporation. Mr. Thornburgh served on the executive committee for six years and as Chairman of the Securities Industry Association in 2004. In addition, he serves on the University of Cincinnati Investment Committee and is a Trustee of St. Xavier High School, Cincinnati, Ohio and chairs its Finance Committee.
				Skills and Qualifications   We believe Mr. Thornburgh’s qualifications to sit on our Board of Directors and Chair our Financial Policy Committee include his financial expertise, his extensive experience in the global financial services industry and his familiarity with strategic transactions acquired through executive-level positions in investment banking and private equity.

 

		2018 Proxy Statement				27

BOARD OF DIRECTORS AND CORPORATE GOVERNANCE (continued)

 

Committees of the Board of Directors

The Company has standing Nominating and Corporate Governance, Audit, and Compensation and Leadership Development Committees. The Chair of each Committee reports to the full Board as appropriate from time to time. Each Committee has a Charter that is reviewed by the Nominating and Corporate Governance Committee on a regular basis. In addition to these three standing Committees, the Board has an Executive Committee and a Financial Policy Committee. A brief description of the Committees follows.

Nominating and Corporate Governance Committee

Members

Edward B. Rust, Jr. (Chair), Marco Alverà, William D. Green, Charles E. Haldeman, Jr., Kurt L. Schmoke

Role and Responsibilities

The Nominating and Corporate Governance Committee’s primary responsibilities include, among other matters:

 

•

Recommending to the Board the general criteria for selection of Director nominees and evaluating possible candidates to serve on the Board;

•

Recommending to the Board appropriate compensation to be paid to Directors;

•

Determining whether any material relationship between a non-management Director and the Company might exist that would affect that Director’s status as independent;

•

Making recommendations, from time to time, to the Board as to matters of corporate governance and periodically monitoring the Board’s performance; and

•

Reviewing with the Board succession plans for the Chief Executive Officer.

Governance, Operations and Procedures

Additional information relating to the Committee’s governance, operations and procedures is provided below:

 

•

The Committee has a Charter that can be viewed and downloaded from the Corporate Governance section of the Company’s Investor Relations website at http://investor.spglobal.com.

•

All current members of the Committee are independent as defined in the rules of the NYSE.

•

The Committee reviews with the Board on an annual basis the appropriate skills and characteristics required of Board members in the context of the then-current composition of the Board. In addition to qualities of intellect, integrity and judgment, this assessment takes into consideration diversity, background, senior management experience and an understanding of some combination of marketing, finance, technology, international business matters, government regulation, public policy and the global capital and commodity markets. The Committee evaluates the skills and qualifications of the existing Board and potential candidates on a continuing basis.

•

The Committee evaluates all nominees for Director based on these criteria, including nominees recommended by shareholders.

•

All nominees for Director included on the Company’s proxy card are currently serving as Directors of the Company.

•

The Committee may retain and terminate search firms to identify Director candidates. The Committee has the sole authority to approve the fees and other retention terms of any such firms.

Committee Advisors

The Committee periodically engages the services of Pay Governance LLC, an independent compensation consultant, to review director compensation survey data and advise the Committee on changes, if any, to non-employee Director compensation. In 2017, the Committee engaged the services of Pay Governance LLC to conduct a review of director compensation and determined not to make any changes.

 

28				2018 Proxy Statement

BOARD OF DIRECTORS AND CORPORATE GOVERNANCE (continued)

 

Audit Committee

Members

Sir Michael Rake (Chair), Stephanie C. Hill, Monique F. Leroux, Maria R. Morris, Richard E. Thornburgh

Role and Responsibilities

The Audit Committee oversees the accounting and financial reporting processes of the Company, the audits of the Company’s financial statements, and the Company’s risk management process. As part of these responsibilities, the Audit Committee’s primary duties include, among other matters, assisting the Board’s oversight of:

 

•

The integrity of the Company’s financial statements;

•

The Company’s compliance with legal and regulatory requirements;

•

The qualifications and independence of the Company’s independent auditors;

•

The performance of the Company’ internal and external auditors; and

•

The key risks of the Company.

Governance, Operations and Procedures

Additional information relating to the Committee’s governance, operations and procedures is provided below:

 

•

The Board of Directors appoints the Committee Chair and determines which Directors serve on the Committee.

•

The Audit Committee Report, on page 91 of this Proxy Statement, summarizes certain important actions of the Committee taken during the Company’s 2017 fiscal year.

•

The Committee has a Charter that can be viewed and downloaded from the Corporate Governance section of the Company’s Investor Relations website at http://investor.spglobal.com.

•

All current members of the Committee are independent as defined in the rules of the New York Stock Exchange.

•

The Board has determined that all members of the Audit Committee qualify as “financial experts” as defined in the rules of the SEC and the New York Stock Exchange. There is a brief listing of the qualifications of the Director nominees who are Committee members in their respective biographies found on pages 16 through 27 of this Proxy Statement.

Compensation and Leadership Development Committee

Members

William D. Green (Chair), Stephanie C. Hill, Monique F. Leroux, Edward B. Rust, Jr., Kurt L. Schmoke

Role and Responsibilities

The Compensation and Leadership Development Committee’s primary responsibilities include, among other matters:

 

•

Establishing an overall total compensation philosophy for the Company, including conducting periodic reviews of the philosophy to ensure it supports the Committee’s objectives and shareholder interests;

•

Administering and interpreting the Company’s incentive compensation plans, including the Key Executive Short-Term Incentive Compensation Plan, the 2002 Stock Incentive Plan, and all other compensation and benefits plans in which the Company’s senior management participates;

•

Establishing performance objectives and approving awards and payments in connection with the Company’s incentive compensation plans to ensure consistency with the Company’s financial and strategic plans and objectives;

 

		2018 Proxy Statement				29

BOARD OF DIRECTORS AND CORPORATE GOVERNANCE (continued)

 

•

Reviewing and approving the corporate goals and objectives for the Chief Executive Officer’s performance, evaluating the Chief Executive Officer’s performance, and establishing the Chief Executive Officer’s total compensation and referring its recommendations to the independent Directors of the Board of Directors for ratification;

•

Establishing and approving the compensation to be paid to the Chief Executive Officer’s direct reports and approving the overall design of the total executive compensation program, with the discretion to approve individual compensation decisions delegated to the Chief Executive Officer; and

•

Reviewing the succession and development plans for executives and other key talent below the direct reports to the Chief Executive Officer.

Governance, Operations and Procedures

Additional information regarding the Committee’s governance, operations and procedures is provided below:

 

•

The Board of Directors appoints the Committee Chair and determines the composition of the Committee members.

•

All current members of the Committee are independent as defined in the rules of the New York Stock Exchange and qualify as “non-employee directors” (as defined under Rule 16b-3 under the Securities Exchange Act of 1934) and as “outside directors” (as defined in Section 162(m) of the Internal Revenue Code).

•

The Committee has a Charter that can be viewed and downloaded from the Corporate Governance section of the Company’s Investor Relations website at http://investor.spglobal.com.

Committee Advisors

The Committee has sole authority to retain and terminate all external consultants and to commission surveys or analyses that it determines necessary to fulfill its responsibilities. Additionally, the Committee has sole authority to approve the fees of the external consultants. The Committee utilizes the services of Pay Governance LLC as its external compensation advisor for all matters concerning the Company’s senior management compensation programs. Pay Governance LLC provides no other executive compensation consulting or other services to the Company or its management. Pay Governance LLC works in cooperation with Company management on matters that come before the Committee but always in its capacity as the Committee’s independent advisor and representative. From time to time, management separately engages the services of Compensation Advisory Partners LLC on various compensation-related matters.

The Committee has entered into a consulting agreement with Pay Governance LLC that specifies the nature and scope of its responsibilities, which include: (1) reviewing Committee agendas and supporting materials in advance of each meeting and raising questions or issues with management and the Committee Chair, as appropriate; (2) at the Committee’s direction, working with management on major proposals in advance of finalization by, and presentation to, the Committee; (3) reviewing drafts of the Company’s Compensation Discussion and Analysis and the Compensation Committee Report and related tables for inclusion in the Company’s Proxy Statement each year; (4) evaluating the chosen compensation peer group and survey data for competitive comparisons; (5) reviewing comparative data on the compensation of the Chief Executive Officer and providing independent analyses and recommendations on the Chief Executive Officer’s compensation to the Committee; and (6) proactively advising the Committee on best practices for Board governance of executive compensation.

In accordance with the Committee’s policy on assessing advisor independence, the Committee determined in 2017 that there were no conflicts of interest or issues related to independence that would impact the advice to the Committee from the firm of Pay Governance LLC and the representatives of Pay Governance LLC who advise both the Committee on executive compensation matters and the Nominating and Corporate Governance Committee on Director compensation matters.

For a further discussion of the role of the Committee in assessing performance and determining compensation with respect to our named executive officers see pages 43 through 46 of this Proxy Statement.

 

30				2018 Proxy Statement

BOARD OF DIRECTORS AND CORPORATE GOVERNANCE (continued)

 

Executive Committee

Members

Charles E. Haldeman, Jr. (Chair), William D. Green, Douglas L. Peterson, Sir Michael Rake, Edward B. Rust, Jr., Richard E. Thornburgh

Role and Responsibilities

The Executive Committee has all the authority of the Board, except for those actions not permitted by Section 712 of the Business Corporation Law of the State of New York. The Chairman of the Board serves as the Chairman of the Executive Committee.

Financial Policy Committee

Members

Richard E. Thornburgh (Chair), Marco Alverà, Charles E. Haldeman, Jr., Rebecca Jacoby, Maria R. Morris, Sir Michael Rake

Role and Responsibilities

The Financial Policy Committee oversees the Company’s financial risks, with particular emphasis on the Company’s financial position, its capital allocation philosophy, its dividend policy, its share repurchase policy and its capital expenditure program. The Financial Policy Committee’s primary responsibilities include, among other matters:

 

•

Reviewing the Company’s financial affairs with management, particularly the Company’s Medium Range Plan and the investment performance of the Company’s retirement and profit-sharing funds;

•

Reviewing management’s proposals and recommendations to the Board, including those relating to share repurchases, mergers and acquisitions, divestitures, and major capital expenditures; and

•

Reviewing management’s proposals with regard to the payment (or non-payment) of dividends and approving or making a recommendation to the Board on such matters.

Governance, Operations and Procedures

Additional information regarding the Committee’s governance, operations and procedures is provided below:

 

•

The Board of Directors appoints the Committee Chair and determines which Directors serve on the Committee.

•

The Committee has a Charter that can be viewed and downloaded from the Corporate. Governance section of the Company’s Investor Relations website at http://investor.spglobal.com.

•

All current members of the Committee are independent as defined in the rules of the New York Stock Exchange.

 

		2018 Proxy Statement				31

BOARD OF DIRECTORS AND CORPORATE GOVERNANCE (continued)

 

Membership and Meetings of the Board and Its Committees

In 2017, no Director attended fewer than 75 percent of the aggregate of the total number of meetings of the Board and the Committees on which he or she served. Committee membership and the number of meetings of the full Board and each Committee held during 2017 are shown in the table below. Ms. Ochoa-Brillembourg and Sir Winfried Bischoff retired from the Board at the 2017 Annual Meeting. The Board held eight meetings in 2017.

 

Audit

Compensation and Leadership Development

Executive

Financial Policy

Nominating and  Corporate Governance

Marco Alverà

Sir Winfried Bischoff

William D. Green

Chair

Charles E. Haldeman, Jr.

Chair

Stephanie C. Hill

Rebecca Jacoby

Monique F. Leroux

Maria R. Morris

Hilda Ochoa-Brillembourg

Douglas L. Peterson

Sir Michael Rake

Chair

Edward B. Rust, Jr.

Chair

Kurt L. Schmoke

Richard E. Thornburgh

Chair

Number of 2017 Meetings

10

6

0

7

8

= Chairperson of the Board     Chair = Committee Chair     = Member

In 2017, the independent Directors met in executive sessions eight times without any member of management present.

Compensation Committee Interlocks and Insider Participation

No member of the Compensation and Leadership Development Committee has served as one of our officers or employees at any time. None of our executive officers serves as a member of the board of directors or compensation committee of any other company that has an executive officer serving as a member of our Board of Directors or Compensation and Leadership Development Committee.

Director and Officer Indemnification and Insurance

Each Director and certain of our executive officers have entered into an indemnification agreement with the Company that provides indemnification for judgments and amounts paid in settlement and related expenses to the fullest extent permitted under the applicable provisions of the New York Business Corporation Law. This indemnification will be reduced to the extent that a Director or executive officer is indemnified by the Company’s Directors’ and Officers’ liability insurance.

 

32				2018 Proxy Statement

BOARD OF DIRECTORS AND CORPORATE GOVERNANCE (continued)

 

The Company has for many years had an insurance program in place that provides Directors’ and Officers’ liability insurance coverage. The Company’s current insurance coverage was purchased for the period May 15, 2017 to May 15, 2018 for a premium of approximately $2.4 million. This insurance is provided by a consortium of carriers that includes: Illinois National Insurance Company; Federal Insurance Co.; Berkshire Hathaway Specialty Insurance; Great American Insurance Co.; Freedom Specialty Insurance Co.; Travelers Casualty & Surety Company of America; Sompo International and AXIS Insurance Company. This program also includes additional capacity dedicated to providing excess coverage for Directors and certain of our executive officers when the Company cannot indemnify them. The additional capacity is provided by the following consortium of carriers: RLI Insurance Company; Berkshire Hathaway Specialty Insurance; Continental Casualty Company; Berkeley Insurance Company; XL Specialty Insurance; Illinois National Insurance Company; U.S. Specialty Insurance Company; Zurich American Insurance Company; and Aspen American Insurance Co.

The Company also maintains a fiduciary liability insurance program that covers Directors and employees who serve as fiduciaries for our employee benefit plans. This coverage, subject to a number of standard exclusions and certain deductibles, indemnifies the Directors and employees from alleged breaches of fiduciary or administrative duties, as defined in the Employee Retirement Income Security Act of 1974 or similar laws or regulations outside the United States. The Company’s current fiduciary liability coverage was purchased for the period May 15, 2017 to May 15, 2018 for a premium of approximately $273,000. This insurance is provided by a consortium of carriers that includes: Illinois National Insurance Company; Federal Insurance Company; and XL Specialty Insurance Company.

Transactions with Related Persons

Under SEC rules, we are required to disclose material transactions with the Company in which “related persons” have a direct or indirect material interest. Related persons include any Director, nominee for Director, executive officer of the Company, any immediate family members of such persons, and any persons known by the Company to be beneficial owners of more than five percent of the Company’s voting securities.

Based on information available to us and provided to us by our Directors and executive officers, and other than the items referred to below, we do not believe that there were any such material transactions with related persons in effect since January 1, 2017, or any such material transactions proposed to be entered into during 2018.

From time to time, shareholders that own more than five percent of our common stock subscribe to, license or otherwise purchase, in the normal course of business, certain of our products and services. These transactions are negotiated on an arm’s-length basis and are subject to review by the Company’s Nominating and Corporate Governance Committee as described below. During 2017, State Street Corporation, BlackRock, Inc. and The Vanguard Group, Inc. and/or their respective affiliates subscribed to, licensed or otherwise purchased in the normal course of business, certain of our products and services. Revenues recognized by us from subscriptions, licenses and other fees related to our products and services by State Street Corporation, BlackRock, Inc. and The Vanguard Group, Inc. and/or their respective affiliates for fiscal 2017 were approximately $142.7 million, $79.4 million and $41.8 million, respectively. The Company paid fees to State Street Global Advisors, Inc., The Vanguard Group, Inc. and BlackRock, Inc. in the amount of $142,000, $79,000 and $15,000, respectively, in 2017 in connection with investment management and certain marketing and business promotion services.

The Company’s Nominating and Corporate Governance Committee reviews and considers transactions with related persons under the Company’s written policy that requires the Committee to review and approve any related person transactions. Under the policy, all related persons are required to promptly notify our Corporate Secretary of any proposed related person transaction. Following notice to our Corporate Secretary, the proposed transaction is then presented to the Nominating and Corporate Governance Committee for its review and consideration at the next Committee meeting. Any ongoing and previously approved related person transactions will be reviewed by the Committee on an annual basis. In reviewing any proposed (or previously approved and ongoing) related person transaction, the Committee must consider all relevant facts and

 

		2018 Proxy Statement				33

BOARD OF DIRECTORS AND CORPORATE GOVERNANCE (continued)

 

circumstances, including, without limitation, the commercial reasonableness of the terms, the benefit and perceived benefit, or lack thereof, to the Company, opportunity costs of alternate transactions, the materiality and character of the related person’s direct or indirect interest, and the actual or apparent conflict of interest of the related person. Approval of a related person transaction (or ratification of a previously approved and ongoing related person transaction) will be given only if it is determined by the Committee that such transaction is in (or not inconsistent with) the best interests of the Company and its shareholders.

Board and Committee Self-Evaluations

The Board annually assesses the performance and effectiveness of the Board and its Committees. The Nominating and Corporate Governance Committee oversees the evaluation process, including determining the format, and presents to the Board the results of the self-evaluations to identify opportunities to enhance effectiveness. Self-evaluation topics generally include, among other matters, Board composition and structure, meeting topics and process, information flow, Board oversight of risk management and strategic planning, succession planning, talent management, and access to management. The Board discusses the results of each annual self-evaluation and, as appropriate, implements enhancements and other modifications identified during the self-evaluation.

Based on feedback from last year’s self-evaluation, the Board enhanced its evaluation process for 2017 Board and Committee performance to incorporate one-to-one interviews with the General Counsel for Board members with a tenure of less than two years (four Board members in total) and updated the Board and Committee self-evaluation questionnaire to include an individual director self-assessment.

Executive Sessions

In response to feedback from the 2016 Board and Committee self-evaluation, executive sessions of our independent directors are held at both the beginning and end of every regularly scheduled Board meeting. Each session is chaired by the independent Chairman of the Board who may, at his discretion, invite the Company’s President and Chief Executive Officer, other employees or members of management or outside advisers or guests to participate in the executive session held at the beginning of regularly scheduled Board meetings, as appropriate.

 

34				2018 Proxy Statement

COMPENSATION DISCUSSION AND ANALYSIS

 

EXECUTIVE COMPENSATION MATTERS

COMPENSATION DISCUSSION AND ANALYSIS

The Compensation and Leadership Development Committee of our Board of Directors (the “Compensation Committee”), comprised of independent Directors, oversees our compensation program for senior executives on behalf of our Board. This Compensation Discussion and Analysis (“CD&A”) describes our named executive officer compensation program and the basis for the compensation paid to our named executive officers for 2017, as well as certain key compensation decisions that have been approved for our named executive officers for 2018.

 

		I. EXECUTIVE SUMMARY AND 2017 FINANCIAL PERFORMANCE
		2017 Named Executive Officers			36
		Compensation Philosophy			36
		Financial Performance Highlights			36
		Pay-for-Performance Overview			37
		Say-on-Pay and Engagement with Shareholders			38
		Decisions for 2018			39
		Overview of Key Best Practices			40
		II. COMPENSATION FRAMEWORK
		Compensation Objectives			41
		Pay Mix			41
		Overview of Pay Elements			42
		III. ASSESSING PERFORMANCE AND DETERMINING COMPENSATION
		Roles and Responsibilities			43
		Setting Compensation			44
		History of Executive Compensation Program Changes			47
		IV. CEO AND NEO COMPENSATION
		2017 Financial Performance and NEO Compensation Decisions			48
		Base Salaries			54
		Short-Term Annual Incentive Plan			54
		Long-Term Incentive Plan			59
		Benefits and Perquisites			62
		V. RISK MANAGEMENT AND GOVERNANCE FEATURES
		Severance Benefits (Regular and Change-in-Control)			64
		Stock Ownership Guidelines			65
		Risk and Control			66
		Pay Recovery Policies			66
		Insider Trading Policy			67
		Employment Agreements			67
		Tax and Accounting Considerations			67
		Compensation Committee Report			67

 

*

Our CD&A, found on pages 35 through 67 of this Proxy Statement, includes adjusted financial information. For a reconciliation of the adjustments to comparable financial measures calculated in accordance with generally accepted accounting principles (“GAAP”) in the U.S., please see Exhibit A and for a reconciliation of organic revenue, please see Exhibit B. The non-GAAP financial information included on Exhibit A and Exhibit B have been provided in order to show investors how our Compensation Committee views the Company’s performance as it relates to the compensation program for our named executive officers.

 

		2018 Proxy Statement				35

COMPENSATION DISCUSSION AND ANALYSIS (continued)

 

2017 Named Executive Officers

The named executive officers (“NEOs”) of the Company for 2017 are as follows:

 

Executive		Position
Douglas L. Peterson		President and Chief Executive Officer (“CEO”)
Ewout L. Steenbergen		EVP, Chief Financial Officer (“CFO”)
John L. Berisford		President, S&P Global Ratings
Michael A. Chinn		President, S&P Global Market Intelligence and EVP, Data and Technology Innovation, S&P Global
Alexander J. Matturri		Chief Executive Officer, S&P Dow Jones Indices

 

Compensation Philosophy

Our compensation philosophy is to reward our executives for creating shareholder value by linking a significant portion of pay to one or more performance metrics tied to value creation. We implement our compensation practices within the framework of pay-for-performance and in a manner that we believe helps us attract the highest quality talent to our executive ranks and retain these individuals by rewarding excellence in leadership and success in the implementation of our business strategy while driving shareholder value.

Financial Performance Highlights

Total Shareholder Return

 

 

Returns assume $100 invested on December 31, 2012 and total return includes reinvestment of dividends through December 31, 2017. Reflects peer group used in the Company’s Form 10-K filed with the SEC on February 9, 2018.

 

36				2018 Proxy Statement

COMPENSATION DISCUSSION AND ANALYSIS (continued)

 

Company Financial Performance

The Company demonstrated strong operating performance in 2017 by showing year-over-year (“YOY”) growth across three key financial measures that the Compensation Committee uses to assess executive officer performance: Incentive Compensation Program (“ICP”) Adjusted Revenue, ICP Adjusted Earnings before Interest, Taxes and Amortization (“ICP Adjusted EBITA”) and ICP Adjusted Earnings Per Share (“ICP Adjusted EPS”):

 

 

 

(1)

Key Executive Short-Term Incentive Compensation Plan (“STIC”).

(2)

For a reconciliation of the adjustments to comparable financial measures calculated in accordance with U.S. GAAP, please see Exhibit A.

(3)

The EPS performance displayed here provides context on the year-over-year performance of the Company and is not equal to the three-year, cumulative compound ICP Adjusted EPS performance used to assess performance against target for PSU awards. For cumulative compound ICP Adjusted EPS results achieved for the 2015-2017 PSU award cycle, please see page 61 of this Proxy Statement.

Significant Business Milestones

In addition to the above strong financials, other 2017 highlights include:

 

•

Rolled out several key Company initiatives including establishing a new integrated operating model designed to stimulate innovation and drive digital transformation.

•

Grew S&P Global Ratings beyond the core products through expansion of additional credit tools including ESG, Green Evaluations and Ratings360.

•

Delivered on product enhancements such as the launch of the new Market Intelligence platform.

•

Continued investment in programs that promote a robust risk, control and compliance culture, ensuring our businesses are ready for the evolving regulatory landscape.

Pay-for-Performance Overview

2017 STIC Funding and 2015-2017 Long-Term Incentive Payouts

S&P Global had strong stock price and financial performance in 2017 and strategically positioned itself to achieve continued performance in the future. The Company’s achievements in 2017 resulted in above target funding for the Key Executive Short-Term Incentive Compensation Plan (“STIC”), and the Company’s sustained performance during the 2015-2017 performance cycle resulted in Long-Term Incentive awards earning and paying out above target. Enterprise-level STIC funding for 2017 was 180% of target (which reflects a reduction of 20 percentage points made by the Compensation and Leadership Development Committee pursuant to Management’s recommendation) (see page 56), the 2015 Long-Term PSU Award earned and paid out at 200% of target (see page 61), and the 2015 Dow Jones Indices Long-Term Cash Award earned and paid out at 140% of target (see page 61).

 

 

		2018 Proxy Statement				37

STIC (1) METRICS: ICP Adjusted Revenue (2) (+7.1 % YOY Growth) ICP Adjusted Revenue metric is used to determine 25% of the pool funding under the STIC Use of this metric strengthens the importance of growth and scale to the Company.
ICP Adjusted EBITA (2) (+17.8% YOY Growth) ICP Adjusted EBITA metric is used to determine 75% of the pool funding under the STIC Use of this metric draws focus to productivity measures and the creation of greater efficiencies throughout the Company.
PSU METRIC: ICP Adjusted EPS (2)(3) (+29.0% YOY Growth) ICP Adjusted EPS is the sole metric for our 3-year Long-Term Performance Share Unit Award (“PSU”) This metric is a unifying measure across the Company that drives long-term value creation for our shareholders because it considers capital allocation decisions as well as the importance of continual discipline in operating performance.

COMPENSATION DISCUSSION AND ANALYSIS (continued)

 

CEO Target Compensation

In the graphic to the right, we have shown Target Total Direct Compensation (“TDC”), which is equal to base salary, target annual incentive award opportunity and long-term incentive grants, assuming target performance, for our CEO, Mr. Peterson, in 2016, 2017, and 2018. As discussed in further detail in the “Setting Compensation” section beginning on page 44 of this Proxy Statement, in consultation with the independent compensation consultant, the Compensation Committee considered several factors such as individual performance and market competitiveness and approved a 15% increase to Mr. Peterson’s target TDC for 2018 as compared to 2017.

Say-on-Pay and Engagement with Shareholders

The Company values shareholder perspectives on our executive compensation program. At the 2017 Annual Meeting, shareholders voted in favor of casting an advisory vote on the executive compensation program for the Company’s NEOs—the “say-on-pay” vote—on an annual basis. As part of the Compensation Committee’s annual review of the program, it considers the outcome of the Company’s annual shareholder advisory vote on the compensation of the Company’s NEOs. Approximately 98% of the “say-on-pay” advisory votes cast in 2017 were in favor of our executive compensation program.

Although this indicated strong support for our program, the Company believes it is important to engage with our shareholders, regardless of our approval rating. We did so this year by continuing our active dialogue with investors, attending 13 investor conferences, visiting investors in 36 cities and in total conducting approximately 800 investor meetings. We also expanded our shareholder outreach efforts by inviting our largest long-term institutional investors, collectively representing approximately 22% of our outstanding shares, to discuss corporate governance matters, including executive compensation. No significant concerns relating to the Company’s compensation program were raised by investors this year.

Examples of prior compensation program changes made in response to shareholder feedback are highlighted on page 47 of this Proxy Statement and affirm our responsiveness to and alignment with our shareholders.

 

38				2018 Proxy Statement

COMPENSATION DISCUSSION AND ANALYSIS (continued)

 

Decisions for 2018

Our Strategy

We are a leading provider of transparent and independent ratings, benchmarks, analytics and data to the capital and commodity markets worldwide. Our purpose is to provide the intelligence that is essential for companies, governments and individuals to make decisions with conviction. We seek to deliver on this purpose within the framework of our core values of integrity, excellence and relevance.

In connection with our ongoing commitment to deliver an exceptional, differentiated customer experience across the globe and power the markets of the future, we have developed a comprehensive, forward-looking business strategy to promote and enhance our development in the key strategic areas of finance, customer, operations, and people. As described in the Company’s Form 10-K filed with the SEC on February 9, 2018, the launch of a new, integrated operating model will provide the framework for our key strategic objectives to provide operational excellence, continuous innovation, and a high performance culture driven by our best-in-class talent.

For additional information on our integrated operating model and our key strategic business goals in the areas of finance, customer, operations and people, please see the “Our Strategy” section of the Company’s Form 10-K.

2018 STIC

In consideration of our new business strategy, as described above, and as part of its annual review of our executive compensation program, the Compensation Committee updated the plan design and performance metrics used for the 2018 STIC to align our short-term incentive awards with our new integrated operating model and enhance the Company’s capabilities in the areas of finance, customer, operations, and people.

Starting in 2018, a balanced scorecard approach will be introduced for measuring and tracking progress on the execution of our new integrated strategy and key objectives. As part of this approach, the funding and payment of individual STIC awards will be determined based on enterprise-, function- and division-level scorecards that combine a blend of financial and non-financial metrics designed to reward business performance results and encourage decision-making that promotes our strategy. The new scorecard approach will continue to feature revenue growth as a financial metric, as well as EBITA margin (rather than EBITA growth used in the prior year), and incorporate key performance indicators to inform the measurement of our progress in the areas of customer, operations and people.

Further information regarding the new 2018 plan design under the STIC can be found beginning on page 58 of this Proxy Statement.

Significant prior executive compensation program design changes are highlighted on page 47 of this Proxy Statement.

One-Time Special Long-Term Incentive Grant

In recognition of Mr. Peterson’s superior individual performance and leadership, and the exceptional performance of the Company in 2017, the Committee approved a one-time, special long-term incentive grant with a grant date value of $2 million, in the form of restricted stock units. The award will cliff-vest after three years and is expected to be granted in early April 2018.

 

		2018 Proxy Statement				39

COMPENSATION DISCUSSION AND ANALYSIS (continued)

 

Overview of Key Best Practices: What We Do and Don’t Do

The Compensation Committee regularly reviews best practices in executive compensation and governance and has revised our policies and practices over time. Today these practices include:

 

Alignment with Shareholders (What We Do)
COMPENSATION PRACTICE				COMPANY POLICY		MORE  DETAIL
ü		Pay-for- Performance & Shareholder Alignment		Approximately 89% of CEO and 77% of other NEOs total compensation opportunity is variable, incentive-based pay contingent on meeting challenging, top-line and bottom-line short-term and long-term performance objectives. We also include caps on individual payouts under our short- and long-term incentive plans.   Long-term incentive compensation opportunities for NEOs are equity-based and tied to business plan performance metrics.		Pgs. 41  & 42
ü		Robust Stock Ownership Guidelines		We have meaningful stock ownership guidelines for our Directors and executive officers. The executive guidelines also require 100% retention until the guidelines are met and a six-month holding policy for stock options after exercise.		Pgs. 65  & 87
ü		Annual Shareholder Say-on-Pay		We value our shareholders’ input and seek an annual non-binding advisory vote from shareholders on our executive compensation program for our NEOs.		Pg. 38
ü		Shareholder Outreach and Input		Our outreach program gives institutional shareholders the opportunity to provide ongoing input on our programs and policies. We carefully review say-on-pay results and all shareholder feedback when structuring executive compensation.		Pgs. 38  & 43
ü		Clawback Policy		Our clawback policy gives us the right to recoup and cancel cash incentive and long-term incentive award payments received by covered active and former employees under various circumstances, including misconduct and financial restatements.		Pg. 66
ü		Anti-Hedging and  Anti-Pledging Policy		Our anti-hedging and anti-pledging policy prohibits Directors, officers and other designated employees from engaging in hedging and pledging transactions related to Company stock.		Pg. 67

 

 

 

Sound Governance Practices (What We Don’t Do)
COMPENSATION PRACTICE				COMPANY POLICY		MORE  DETAIL
×		No Single Trigger  Change-in-Control		Our Long-Term Incentive Plan awards are subject to “double-trigger” treatment in the case of a change-in-control (i.e., unvested awards are accelerated only if there is both a change-in-control and an involuntary termination of employment).		Pg. 64
×		No Excessive  Perquisites		We do not provide excessive executive perquisites to our NEOs and we believe our limited perquisites are reasonable and competitive.		Pgs. 62  & 63
×		No Tax   Gross-Ups		We do not provide tax gross-ups in connection with any perquisites or in the event of any “golden parachute payment” in connection with a change-in-control.		Pgs. 63  & 65
×		No Dividends on  Unearned Awards		We do not pay dividends on unearned PSUs or RSUs.		Pg. 42
×		No Employment  Contracts		None of our NEOs has a formal employment contract.		Pg. 67
×		Pension  Benefits Frozen		We froze both our defined benefit pension plans to new participants and future accruals, effective as of April 1, 2012.		Pg. 63

 

40				2018 Proxy Statement

COMPENSATION DISCUSSION AND ANALYSIS (continued)

 

Compensation Objectives

The main objectives of our executive compensation program are:

 

•

To hire and retain high-caliber executive talent with the leadership abilities and experience necessary to implement our business strategy while driving shareholder value;

•

To pay for performance and sustainable, long-term growth by rewarding the achievement of challenging business and individual performance goals;

•

To build value for shareholders and encourage growth by linking a significant portion of compensation to Company performance with an appropriate balance of short-term and long-term objectives to deepen the alignment of our executives to our shareholders; and

•

To manage risk through oversight and compensation design to ensure that our incentive programs appropriately motivate our executives to encourage prudent, but not excessive, risk-taking.

Pay Mix

In establishing an appropriate mix of fixed and variable pay to reward Company, line of business and individual performance, the Compensation Committee balances the importance of meeting our short-term business goals and maintaining a competitive compensation package designed to attract, motivate and retain experienced and talented executive officers with the need to create shareholder value and drive growth over the longer-term.

Our integrated compensation framework heavily weights variable compensation to reward achievements against pre-established, quantifiable financial performance objectives and individual strategic performance objectives. In addition, because a significant portion of variable compensation is delivered in the form of equity-based awards, which vest over three years, the value ultimately realized by our executives from these awards depends on stockholder value creation, as measured by the future performance of our stock price.

 

 

 

		2018 Proxy Statement				41

COMPENSATION DISCUSSION AND ANALYSIS (continued)

 

Overview of Pay Elements

For 2017, guided by our compensation philosophy and objectives, the executive compensation program consisted of the elements listed below. The Compensation Committee believes that each compensation element, and all of these elements combined, are important to maintain an executive compensation program that is competitive, performance-based and shareholder-focused.

 

 

 

42				2018 Proxy Statement

ELEMENT DESCRIPTION LINK TO STRATEGY & BUSINESS MORE DETAIL Fixed Annual LongiTerm Variable/Performance-Based Base Salary Short-Term Annual Incentive Long-Term Incentives PSUs RSUs Long-Term Cash Awards Other Market competitive fixed pay, reflective of individual performance, time in role, scope of responsibility, leadership skills and experience. Reviewed on an annual basis against individual performance and compensation market data and adjusted, as appropriate, to maintain market alignment. Performance-based cash compensation dependent on performance against annually established 30%-weighted individual and 70%-weighted Company financial targets (comprised of ICP Adjusted Revenue and ICP Adjusted EBITA targets) Our NEOs are assigned a target incentive award with the actual award calculated as a percentage of this target. The maximum incentive award payout is capped at 200% of the target award. For most NEOs, PSUs represented 70% of the total long-term incentive grant value. Based on three-year growth in ICP Adjusted EPS with maximum earnings potential capped at 200% of the target award. Awards vest upon completion of the three-year performance period and the Compensation Committee’s certification of performance. No dividends are paid on unearned PSUs. For most NEOs, RSUs represented 30% of the total long-term incentive grant value. Long-term annual equity-based incentives, whose ultimate value is tied to Company performance through stock price. 2017 awards vest ratably on each of the three fiscal year-end dates following the grant of the award. No dividends are paid on unearned RSUs. For Mr. Matturri, long-term cash represented 60% of the long-term incentive grant value, with the remaining 40% made up of a mix of 70% PSUs and 30% RSUs. Based on three-year growth in division specific EBITA with a maximum payout capped at 200% of the target award. Awards vest upon completion of the three-year performance period and the Compensation Committee’s certification of performance. Health, welfare and retirement programs. Limited perquisites. Competitive base salaries help attract and retain key executive talent. Material adjustments are based on individual performance and market data and are not guaranteed. Rewards performance to achieve short-term business objectives that grow annual organic revenue, increase profitability and draw focus to the bottom line to create greater efficiencies, all of which we believe ultimately drive increased long-term shareholder value. Also motivates executives to deliver individual performance against strategic objectives. These long-term equity and long-term cash incentive awards promote executive share ownership and alignment with shareholders’ interest in the Company’s long-term growth. Plan design ensures that executives have compensation that is performance based for longer periods of time and mitigates excessive risk-taking over a long-term horizon. Awards support retention objectives and are subject to forfeiture in the event that an executive terminates their employment. NEOs generally participate in the same benefit programs that are offered to other salaried employees. Reasonable, limited perquisites are provided to executives to facilitate strong performance on the job and enhance their productivity.

COMPENSATION DISCUSSION AND ANALYSIS (continued)

 

Roles and Responsibilities

 

 

		2018 Proxy Statement				43

COMPENSATION DISCUSSION AND ANALYSIS (continued)

 

Setting Compensation

The Compensation Committee considers the following factors in using its discretion to determine the amount and form of compensation to be awarded to each of our NEOs.

 

 

Use of Market Data

Our Compensation Committee independently evaluates the performance of the CEO and establishes the CEO’s total annual target compensation so that his base salary, target annual incentive opportunity and target long-term incentive awards are competitive against market data for our Proxy Peer Group (detailed below) in addition to compensation survey data (described below) from financial services and general industry firms. The Compensation Committee refers its recommendations to the independent Directors of the Board for review and ratification. For more information on CEO historical and current target total direct compensation, see page 38 of this Proxy Statement.

For our NEOs other than the CEO, we review the range of market compensation between the 25th and 75th percentiles for our Proxy Peer Group as well as company data provided in the compensation surveys described below to develop an understanding of market pay levels for each position. In general, we design our executive compensation program to pay median levels of compensation for target levels of achievement, to pay below median for achievement below target, and to pay above median compensation for significantly higher levels of achievement versus target goals.

We annually review compensation market data in setting base salaries and short-term and long-term incentive opportunities for all our NEOs. However, we do not limit or increase individual incentive payments based solely on these market reference points. We also consider factors such as internal pay equity, input from Pay Governance as our independent compensation consultant, risk management and governance, shareholder input, individual and Company performance, business and market conditions, the critical skills and experience of the NEO and the strategic importance of his or her role to the Company.

For purposes of setting compensation targets for 2017 and 2018, the Compensation Committee was provided with competitive data for our Proxy Peer Group by Pay Governance as well as information from two compensation surveys in which the Company participates: the McLagan Financial Services Survey and the Willis Towers Watson General Industry Executive Compensation Survey.

 

44				2018 Proxy Statement

COMPENSATION DISCUSSION AND ANALYSIS (continued)

 

Proxy Peer Group

The Compensation Committee reviews the composition of the Proxy Peer Group each year to ensure it remains appropriate to use in competitive analysis of executive compensation from size, industry and business model perspectives.

In reviewing and identifying our 2017 Proxy Peer Group, the Compensation Committee considered a number of factors including shareholder adviser methodologies to identify peer groups, and the annual revenue, market capitalization and mix of businesses of the companies considered and selected. With the assistance of Pay Governance, the Compensation Committee identified companies (listed below) to serve as market reference points for compensation comparison purposes for 2017, with particular reference to industry, revenue and market capitalization. Since we have few direct competitors for the specific scope of our business activities, the companies represented in our Proxy Peer Group vary in terms of firm size and business model.

The Compensation Committee continually seeks to improve the criteria used to select the Proxy Peer Group. As part of its annual review of the Proxy Peer Group with Pay Governance, the Compensation Committee enhanced its peer company selection criteria to better reflect firms, other than direct competitors, with which we compete in some aspects of our businesses, including competitors for executive talent. Based on these improvements, the Compensation Committee added Marsh & McLennan Companies, Inc. to the 2018 Proxy Peer Group for purposes of setting 2018 compensation targets. The Committee believes that the updated peer group appropriately reflects the companies with which S&P Global competes for business and executive talent.

Survey Peer Groups

Survey data allows the Compensation Committee to compare compensation levels for certain roles to a wider spectrum of companies and benchmark them to a broader market for talent.

The companies that comprise the McLagan survey peer group are listed below. The Willis Towers Watson survey does not identify the specific companies that reported compensation information.

2017 Peer Group Companies

 

 

 

		2018 Proxy Statement				45

COMPENSATION DISCUSSION AND ANALYSIS (continued)

 

In terms of size, as shown in the table below, at the end of 2017, the Company’s annual revenue was between the median and the 75th percentile and the Company’s market capitalization was above the 75th percentile of the 2017 Proxy Peer Group.

 

2017 Proxy Peer Group		Revenue ($ billions)				Market Cap. ($ billions)
25th Percentile		$	3.99			$	15.58
Median		$	5.29			$	27.64
75th percentile		$	7.64			$	37.47
S&P Global		$	6.06			$	42.98

Internal Pay Equity

The Compensation Committee also takes into account internal equity when making pay decisions. While there is not an established formal policy on internal pay equity guidelines, the Compensation Committee reviews compensation levels to ensure that the appropriate internal equity exists. This is determined based on various considerations including management of revenue or operating profit, headcount responsibility, geographic scope, and job complexity.

Performance and Talent Assessment

The Compensation Committee’s consideration is further informed by the Company’s performance evaluation process that measures management against individual qualitative and quantitative goals, behaviors and competencies aligned with the Company’s strategic plan. The goals reflect financial targets inclusive of short-term operating goals, long-term value creation, human capital initiatives, and risk and compliance expectations. The Compensation Committee along with the entire Board (other than the CEO with respect to his review) participates in an annual review and discussion of each NEO as well as succession planning for each position. Further information on the Company’s business performance as well as each NEO’s key individual achievements for 2017 can be found beginning on page 48 of this Proxy Statement. Additionally, further information about succession planning can be found beginning on page 13 of this Proxy Statement.

Other Factors

The Compensation Committee also considers input from its independent compensation consultant and our shareholders as well as additional factors, including business and market conditions, leadership skills and experience, risk management and governance, and tax deductibility and accounting considerations. Further information on the role of the independent compensation consultant and our shareholders can be found on page 43 of this Proxy Statement.

 

46				2018 Proxy Statement

McLagan Survey Peer Group BlackRock, Inc. CME Group Inc. Discover Financial Services Franklin Resources, Inc. Fidelity National Information Services, Inc. lnvesco Ltd. Legg Mason, Inc. Moody’s Corporation Northern Trust Corporation Raymond James Financial, Inc. State Street Corporation T. Rowe Price Group, Inc. TD Ameritrade Holding Corporation The Charles Schwab Corporation Equifax Inc. Fiserv, Inc. Intercontinental Exchange, Inc. MasterCard Incorporated The NASDAQ OMX Group, Inc. Verisk Analytics, Inc. Proxy Peer Group

COMPENSATION DISCUSSION AND ANALYSIS (continued)

 

History of Executive Compensation Program Changes

The changes described below show enhancements to our compensation programs that we have made over time, and that continue to be in effect in 2017. We believe that these improvements demonstrate our responsiveness to and alignment with our shareholders and exhibit our commitment to incorporating best practices, pay-for-performance, and adapting to market conditions.

 

 

 

		2018 Proxy Statement				47

[Redesigned STIC to Promote Business Strategy: We redesigned our STIC to incorporate a balanced scorecard approach with quantitative and qualitative metrics for measuring progress against our new integrated business strategy. The new scorecard approach promotes greater alignment across the organization and rewards execution of our strategy by introducing updated financial metrics, of Revenue and EBITA margin (rather than EBITA growth), and incorporating key performance indicators to inform the measurement of our progress in the key strategic areas of customers, operations and people.]
Ratable Vesting for R SUs: We modified the vesting schedule for awards of RSUs so that all future RSU grants will vest ratably over three years rather than vest in full after three years. This change is intended to provide us with a more effective recruitment tool, conforms to industry practice and is appropriately balanced by the * three-year vesting schedule for performance-based long-term (PSU) awards, which represent the majority of the total long-term grant value for NEOs.
Refined Performance Metrics to Enhance Pay for Superior Results and Drive Performance: We changed our non-GAAP reporting (which impacts all of our incentive plans) by adjusting for deal-related amortization to better reflect the underlying economic performance of the business, consistent with how management views financial results. We also refined our performance metrics to provide a better measure of performance and align with practices of peer companies, consistent with feedback received from key stakeholders.
Increased CEO Stock Ownership Guideline: We increased our CEO stock ownership guideline multiple from five times (5x) to six times(6x) base salary.
Reformulated the Design of Long-Term Equity: We changed the mix of our long-term incentives from 70% PSUs and 30% stock options to 70% PSUs and 30% RSUs in response to shareholder input concerning dilution from the stock-based awards as well as to better align with market practice.
“Double-Trigger” Vesting of Equity Awards: We amended the terms of our equity awards so that all awards granted after 2014 are subject to “double-trigger” treatment in the case of a change-in-control.
Strengthened Pay-for-Performance Goal Setting and Performance Management: We instituted formalized measuring of management against individual qualitative and quantitative goals, behaviors and competencies, which are aligned with the Company’s strategic plan and cascaded down through the organization.
Expanded the Pay Recovery Policy: We expanded our Pay Recovery Policy to covervariable compensation and a greater number of executives.
Reduced Perquisites: We further reduced our already limited perquisites provided to NEOs.
Established New Peer Group to Better Align with Business Strategy: We established a new proxy peer group as a result of our change in business emphasis. We considered a number of factors, including proxy advisory firms’ methodology to identify peer groups, and the annual revenue, market capitalization and mix of businesses of the companies considered and selected.
Retirement Plan De-Risking: We enhanced our defined contribution retirement program for our employees generally, thereby assisting in their accumulation of retirement savings.
Prohibited Hedging and Pledging: We revised our Insider Trading Policy to prohibit without exception the hedging or pledging of Company stock by our officers, other designated employees and Directors and to implement guidelines to require that any previously existing pledges be unwound.

COMPENSATION DISCUSSION AND ANALYSIS (continued)

 

2017 Financial Performance and NEO Compensation Decisions

Financial Performance Overview in 2017

In 2017, the Company had strong annual operational and financial performance, including the following highlights:

 

 

NEO Compensation Decisions in 2017

The table below shows the Compensation Committee’s compensation decisions for 2017 for the NEOs, and is different from the SEC required disclosure in the “2017 Summary Compensation Table” beginning on page 68. It is a blend of annualized base salary and compensation that is actually paid (incentive payout) or granted (long-term incentive grants) that together reflects the total annual 2017 compensation decision for each NEO.

The Compensation Committee established the calendar year base salary and annual long-term incentive grant amount for each NEO early in the fiscal year. The annual incentive payout amount was calculated and paid after the fiscal year ended based on the incentive plan funding and the individual performance of each NEO, as described below.

 

Executive								Actual 2017 Long-Term Incentive Grants at Target												Total 2017 Annual Compensation
		Annualized 2017 Base Salary				Actual 2017 Incentive Payment		RSUs				PSUs				Long-Term Cash
D. Peterson		$	1,000,000			$3,240,000		$	1,800,000			$	4,200,000			$	—			$	10,240,000
E. Steenbergen		$	750,000			$1,950,000		$	540,000			$	1,260,000			$	—			$	4,500,000
J. Berisford		$	600,000			$1,300,000		$	390,000			$	910,000			$	—			$	3,200,000
M. Chinn		$	550,000			$1,300,000		$	315,000			$	735,000			$	—			$	2,900,000
A. Matturri		$	550,000			$1,200,000		$	120,000			$	280,000			$	600,000			$	2,750,000

 

 

48				2018 Proxy Statement

$6,063M ICP ADJUSTED REVENUE [+7% increase from 2016 baseline] $2,857M ICP ADJUSTED EBITA [+18% increase from 2016 baseline] $6.89 ICP ADJUSTED EPS [+29% increase from 2016 baseline] Significant Business Milestones Established a new integrated operating model. Grew ratings beyond the core products. Delivered on product enhancements. Promoted a robust risk, control and compliance culture. Share Price Increased by 58%

COMPENSATION DISCUSSION AND ANALYSIS (continued)

 

CEO Pay Decisions

Douglas L. Peterson: President and Chief Executive Officer

Mr. Peterson joined the Company in September 2011 as President, Standard & Poor’s Ratings Services. He was promoted to his current role in November 2013.

 

 

		2018 Proxy Statement				49

COMPENSATION DISCUSSION AND ANALYSIS (continued)

 

Other NEO Pay Decisions

Ewout L. Steenbergen: EVP, Chief Financial Officer

Mr. Steenbergen joined the Company in his current role in November 2016.

 

 

50				2018 Proxy Statement

COMPENSATION DISCUSSION AND ANALYSIS (continued)

 

John L. Berisford: President, S&P Global Ratings

Mr. Berisford joined the Company in January 2011 as Executive Vice President, Human Resources. Effective November 3, 2015, he was appointed to his current role as President, S&P Global Ratings.

 

 

		2018 Proxy Statement				51

COMPENSATION DISCUSSION AND ANALYSIS (continued)

 

Michael A. Chinn: President, S&P Global Market Intelligence and

EVP, Data and Technology Innovation, S&P Global

Mr. Chinn joined the Company in September 2015 as President, S&P Market Intelligence. During the 2017 fiscal year, Mr. Chinn was President, Market and Commodities Intelligence. Effective January 1, 2018, he was also appointed as Executive Vice President, Data and Technology Innovation, S&P Global.

 

 

52				2018 Proxy Statement

COMPENSATION DISCUSSION AND ANALYSIS (continued)

 

Alexander J. Matturri: Chief Executive Officer, S&P Dow Jones Indices

Mr. Matturri joined the Company in his current role in May 2007.

 

 

		2018 Proxy Statement				53