Zoetis Inc

For the period ended May 22, 2024. Filed Apr 10, 2024.

About this filing

What shareholders are asked to vote on at a company's meeting. It is where to find what directors and top executives are paid, and who owns the most shares.

May 22, 2024 · Filed Apr 10, 2024

ZTS$79.40-3.3%Stored close · as of Nov 6, 2026

See the whole filing, with its images and exhibits

Contents

Pay Versus Performance

The following tables and charts provide additional compensation information regarding our NEOs, prepared in accordance with the SEC’s pay versus performance disclosure regulations for fiscal years 2023, 2022, 2021 and 2020.

Pay Versus Performance (PVP) Table

· · · · Summary Compensation Table (SCT) Total for CEO(1) ($) · · · · Compensation Actually Paid (CAP) to CEO(1)(2) ($) · · · · Average SCT Total for Other NEOs(1) ($) · · · · Average CAP to Other NEOs(1)(2) ($) · · · · Value of Initial Fixed $100 Investment Based On: · · · · Net Income ($ in millions) · · · · Revenue (Company Selected Measure) ($ in millions) ·
· Year · · · · Zoetis TSR ($) · · · · S&P 500 Pharmaceuticals Index TSR ($) · ·
	2023	15,237,853	26,369,229	2,994,932	4,592,358	153.30	147.14	2,344	8,544
	2022	14,003,540	(15,709,790)	2,931,816	(3,076,052)	112.80	146.65	2,114	8,080
	2021	13,098,491	33,519,679	4,455,516	10,261,897	186.46	135.22	2,037	7,776
	2020	10,374,312	15,564,796	3,756,846	6,519,899	125.76	107.52	1,638	6,675

(1)

In all years shown Kristin C. Peck was our Chief Executive Officer. The other named executive officers (NEO) represent the following individuals: for 2023, Wetteny Joseph, Heidi C. Chen, Wafaa Mamilli and Robert J. Polzer; for 2022, Wetteny Joseph, Glenn C. David, Heidi C. Chen, and Wafaa Mamilli; for 2021, Wetteny Joseph, Glenn C. David, Catherine A. Knupp, Roman Trawicki and Heidi C. Chen; and for 2020, Glenn C. David, Catherine A. Knupp, Roman Trawicki and Wafaa Mamilli.

(2)

To calculate Compensation Actually Paid (CAP) the following amounts were deducted from and added to the Summary Compensation Table (SCT) total compensation:

CEO SCT Total to CAP Reconcillation:

· Year · · · · SCT Total ($) · · · · Deductions from SCT Total(i) · · · · Additions to SCT Total(ii) ($) · · · · Compensation Actually Paid ($) ·
· Stock Awards ($) · · · · Options Awards ($) · ·
	2023	15,237,853	(8,774,860)	(2,924,967)	22,831,203	26,369,229
	2022	14,003,540	(8,399,841)	(2,799,966)	(18,513,523)	(15,709,790)
	2021	13,098,491	(6,929,797)	(2,309,970)	29,660,955	33,519,679
	2020	10,374,312	(5,684,840)	(1,894,975)	12,770,299	15,564,796

Average Other NEOs SCT Total to CAP Reconcillation:

· Year · · · · SCT Total ($) · · · · Deductions from SCT Total(i) · · · · Additions to SCT Total(ii) ($) · · · · Compensation Actually Paid ($) ·
· Stock Awards ($) · · · · Options Awards ($) · ·
	2023	2,994,932	(1,239,133)	(413,112)	3,249,671	4,592,358
	2022	2,931,816	(1,405,542)	(468,570)	(4,133,756)	(3,076,052)
	2021	4,455,516	(2,118,241)	(366,105)	8,290,727	10,261,897
	2020	3,756,846	(1,302,977)	(496,860)	4,562,890	6,519,899

(i)

These deductions are the amounts listed in the “Stock Awards” and “Option Awards” columns of the SCT and represent the grant date fair value of equity-based awards granted each year.

72 Zoetis 2024 Proxy Statement

(ii)

Reflects the value of equity calculated in accordance with the SEC methodology for determining CAP for each year shown. The equity component for each year is detailed in the supplemental table below:

CEO Equity Component of CAP:


2023	Stock Options		3,971,133		1,923,431		372,068		6,266,632
Restricted Stock Units		3,585,639		1,500,387		162,461		5,248,488
Performance Award Units		8,054,738		3,060,551		200,795		11,316,083
Total		15,611,510		6,484,369		735,324		22,831,203
2022	Stock Options		1,528,648		(7,897,241)		(931,398)		(7,299,991)
Restricted Stock Units		2,049,978		(2,672,369)		(234,149)		(856,541)
Performance Award Units		2,460,116		(12,009,652)		(807,455)		(10,356,991)
Total		6,038,742		(22,579,262)		(1,973,002)		(18,513,523)
2021	Stock Options		5,709,571		5,052,274		33,020		10,794,866
Restricted Stock Units		3,523,058		1,469,682		10,165		5,002,905
Performance Award Units		8,916,215		4,932,126		14,842		13,863,183
Total		18,148,844		11,454,083		58,027		29,660,955
2020	Stock Options		2,309,500		1,341,931		385,408		4,036,839
Restricted Stock Units		2,186,374		411,103		103,798		2,701,275
Performance Award Units		4,749,437		1,128,981		153,769		6,032,186
Total		9,245,311		2,882,015		642,974		12,770,299

Average Other NEOs Equity Component of CAP:


2023	Stock Options		560,869		169,611		46,139		776,619
Restricted Stock Units		506,345		509,551		20,141		1,036,037
Performance Award Units		1,137,439		284,615		14,962		1,437,015
Total		2,204,652		963,777		81,242		3,249,671
2022	Stock Options		255,817		(1,352,757)		(446,281)		(1,543,221)
Restricted Stock Units		343,039		(1,110,941)		(112,191)		(880,093)
Performance Award Units		411,640		(1,735,180)		(386,902)		(1,710,442)
Total		1,010,496		(4,198,878)		(945,373)		(4,133,756)
2021	Stock Options		904,905		1,796,558		22,234		2,723,696
Restricted Stock Units		1,897,216		490,667		6,844		2,394,727
Performance Award Units		1,413,054		1,749,257		9,993		3,172,304
Total		4,215,175		4,036,482		39,071		8,290,727
2020	Stock Options		605,548		908,841		240,880		1,755,269
Restricted Stock Units		573,225		278,702		64,872		916,799
Performance Award Units		1,010,271		784,446		96,105		1,890,822
Total		2,189,044		1,971,988		401,857		4,562,890

Zoetis 2024 Proxy Statement 73

List of Most Important Measures

The four items listed below represent the most important metrics we used to determine CAP for 2023 as further described in our CD&A within the sections titled “Annual Incentive Plan” and “Long-Term Incentives”:

	Most Important Performance Measures
	Relative Total Shareholder Return(i)
	Revenue(ii)
	Adjusted Diluted EPS(ii)
	Free Cash Flow(ii)

(i)

Relative Total Shareholder Return is the 3-year performance metric used for Zoetis’ performance award units, which comprise 50% of the long-term incentive compensation of our NEOs, including the CEO. Total Shareholder Return (TSR) is the appreciation of share price, including dividends, during the performance period. Relative TSR is Zoetis’ TSR as compared to the TSR over the performance period of the “S&P 500 Group”, which we define as the companies comprising the S&P 500 stock market index as of the beginning of the performance period, excluding companies that during the performance period are acquired or no longer publicly traded.

(ii)

Revenue, Adjusted Diluted EPS and Free Cash Flow refer to the measures used to assess performance in determining the funding for our Annual Incentive Plan (AIP) and exclude the impacts of foreign exchange and certain other adjustments as described in the CD&A.

Description of the CAP and Performance Relationship

Total Shareholder Return (TSR): Zoetis versus S&P 500 Pharmaceuticals Index

The graph below compares an initial investment in our common stock of $100 on December 31, 2019, versus the same investment in the S&P 500 Pharmaceuticals Index (assuming dividends, if any, were reinvested). It should be noted that the companies in the S&P 500 Pharmaceuticals index are not the same as those used for our compensation benchmarking, nor are they the same as the S&P 500, which is the group of companies we use to determine Relative TSR for the company’s performance award unit metric, as described in the CD&A.

74 Zoetis 2024 Proxy Statement

Compensation Actually Paid (CAP) versus Zoetis TSR

The graph below compares the Compensation Actually Paid (CAP) of the CEO and the Other NEOs, to Zoetis’ TSR for the four fiscal years beginning with 2020. As the graph shows, the CAP to the CEO and Other NEOs is directionally aligned with the Company’s TSR.

CAP versus Net Income

The graph below compares the CAP of the CEO and the Other NEOs, to Zoetis’ net income for the four fiscal years beginning with 2020. Net Income has steadily increased while the CEO and Other NEOs CAP has varied by year. Zoetis does not use net income as a metric in its compensation incentives.

Zoetis 2024 Proxy Statement 75

CAP versus Revenue (Company Selected Measure)

The graph below compares the CAP of the CEO and the Other NEOs, to Zoetis’ revenue for the four fiscal years beginning with 2020. Revenue has steadily increased while the CEO and Other NEOs’ CAP has varied by year. While revenue is a metric in Zoetis’ AIP, the weight of equity-based LTI — which primarily reflect stock price and relative TSR — exceeds the weight of our annual incentive in the total compensation for executives.

76 Zoetis 2024 Proxy Statement

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