CALERES INC
For the period ended May 23, 2024. Filed Apr 11, 2024.
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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 23, 2024 · Filed Apr 11, 2024
Contents
PROXY STATEMENT SUMMARY
This summary highlights certain information relating to the items being voted on that can be found in greater detail elsewhere in this proxy statement. For additional information about these topics, shareholders should read the entire proxy statement before voting.
2024 Annual Meeting of Shareholders
| May 23, 2024 10:30 A.M., Central Time | Caleres, Inc. 8300 Maryland Avenue St. Louis, Missouri 63105 |
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Voting Matters
Your vote is very important to us. Whether or not you plan to attend the 2024 annual meeting, we urge you to vote and submit your proxy on all of the proposals to ensure that your shares are represented.
| Proposal · Board Recommendation · For more information, see page | ||
|---|---|---|
| Proposal 1 — Election of Directors. | FOR each nominee | 21 |
| Proposal 2 — Ratification of Ernst & Young LLP as the Company’s independent registered public accountants. | FOR | 29 |
| Proposal 3 — Approval, by non-binding advisory vote, of the Company’s executive compensation | FOR | 66 |
Financial Highlights for 2023
Caleres delivered a strong operational and financial performance in 2023. While sales and earnings retracted modestly from record-setting results last year, we made progress on a number of strategic initiatives that set the stage for future growth. Our earnings per diluted share of $4.80 was more than double ourpre-pandemic earnings per share record and represented the third consecutive year of adjusted earnings per share above the $4.00 baseline. The Brand Portfolio, powered by Lead Brands — Sam Edelman, Allen Edmonds, Naturalizer and Vionic – achieved its best-ever adjusted annual operating earnings at $145 million and generated an exceptional 11.7% adjusted return on sales. At the same time, Famous Footwear leaned into its competitive advantages and leadership position with the Millennial family to increase market share in shoe chains and in Kids. Furthermore, we continued to strengthen our balance sheet and enhance our financial flexibility by reducing borrowings by $126 million from year end 2022. We ended the year at our lowest level of indebtedness, or $182 million borrowed, since 2010. In addition, we continued to invest in value-driving organic growth opportunities while returning $27 million to shareholders through share repurchases and quarterly dividend payments. The structural changes we have made in recent years have transformed Caleres into a more agile, efficient, and profitable organization and have positioned us exceptionally well for the future. The following are a few highlights of our financial results for 2023.
| • | Consolidated net sales decreased $150.8 million, or 5.1%, to $2,817.3 million in 2023, compared to $2,968.1 million last year. Net sales of our Famous Footwear segment decreased $95.7 million, or 5.6%, compared to 2022. Net sales of our Brand Portfolio segment decreased $51.9 million, or 3.9%, compared to 2022. |
| • | Consolidated operating earnings decreased to $194.5 million in 2023, compared to $214.3 million last year. The decrease was primarily driven by lower net sales in 2023, partially offset by a higher gross profit margin. |
| • | On a GAAP basis, we reported consolidated net earnings attributable to Caleres, Inc. of $171.4 million, or earnings per diluted share of $4.80 compared to $181.7 million, or earnings per diluted share of $4.92, |
Caleres | 2024 Proxy Statement 1
last year. On an adjusted basis, our net earnings were $149.3 million, or earnings of $4.18 per diluted share, compared to $167.1 million, or $4.52 per diluted share last year.1
Director Nominees
In accordance with our restated certificate of incorporation and bylaws which provide that as of the 2023 annual meeting all directors will be elected forone-year terms, the board of directors has nominated eleven directors for election at the 2024 annual meeting, as outlined in the table below, for aone-year term expiring at the annual meeting of shareholders to be held in 2025.
| Name | Age | DirectorSince | Independent | Primary Occupation | Committees |
|---|---|---|---|---|---|
| Lisa A. Flavin | 59 | 2019 | Yes | Senior Vice President, Chief Compliance and Transformation Officer, Emerson | Audit, Chair; Executive |
| Brenda C. Freeman | 59 | 2017 | Yes | Founder, Joyeux Advisory Group | Technology and Digital Commerce, Chair; Governance and Nominating |
| Lori H. Greeley | 64 | 2015 | Yes | Chief Executive Officer, Serena & Lily | Culture, Compensation and People |
| Mahendra R. Gupta | 68 | 2011 | Yes | Geraldine J. and Robert L. Virgil Professor of Accounting, Olin School of Business | Audit |
| Carla C. Hendra | 67 | 2005 | Yes | Former Global CEO, Growth + Innovation at Oglivy | Governance and Nominating; Technology and Digital Commerce |
| Ward M. Klein | 68 | 2007 | Yes | Former Executive Chairman, Edgewell Personal Care | Executive; Governance and Nominating, Chair |
| Steven W. Korn | 70 | 2004 | Yes | Former President & Chief Executive Officer, Radio Free Europe / Radio Liberty | Audit; Governance and Nominating |
| Wenda Harris Millard | 69 | 2017 | Yes | Former Vice Chairman, Media Link | Culture, Compensation and People, Chair; Executive |
| John W. Schmidt | 63 | 2022 | No | President and CEO, Caleres | Executive |
| Diane M. Sullivan | 68 | 2007 | No | Executive Chair, Caleres | Executive, Chair |
| Bruce K. Thorn | 57 | 2022 | Yes | President and CEO, Big Lots, Inc. | Culture, Compensation and People; Technology and Digital Commerce |
Corporate Governance Highlights
Since 1878, we have been guided by a value system that emphasizes integrity and trust at all levels of our organization. We have longstanding policies and practices to promote the management of our Company with integrity and in our shareholders’ best interests.
| 1 | A reconciliation of adjusted results is included in Annex 1 to this proxy statement. |
2 Caleres | 2024 Proxy Statement
The board of directors has adopted and adheres to corporate governance practices that it believes represent sound practices, including the following.
| Board Composition | Ø Our board is declassified and all directors are elected annually. Ø Our board has an effective mix of skills, experience and perspectives. Ø Over half of our directors are diverse. Assuming election of the director nominees proposed herein, effective as of the 2024 annual meeting 55% of our directors will be female and 18% will be racially and ethnically diverse. Ø Our director tenure is balanced. Assuming election of the director nominees proposed herein, effective as of the 2024 annual meeting average director tenure will be 10.6 years. |
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| Board Independence | Ø 9 out of the 11 members of the board of directors are independent. Ø Our Executive Chair and CEO are the only management directors. Ø Our Audit, Governance and Nominating, Culture, Compensation & People, and Technology & Digital Commerce Committees are comprised solely of independent directors. |
| Governance Practices | Ø We have an independent lead director with a clearly defined role who coordinates the activities of the other independent directors. Ø The independent directors meet regularly in executive session. Ø The board of directors and committees conduct annual self-evaluations. Ø We have a director resignation policy in the event an incumbent director does not receive a majority of votes cast. Ø We maintain a policy under which no director may be appointed if he or she is 72 or older or nominated for a term extending beyond the annual shareholders’ meeting following the end of the calendar year during which the individual turns 72, except in limited circumstances. Ø The Company does not have a poison pill in place. Ø Risk management is overseen by the full board of directors and designated committees. |
Caleres | 2024 Proxy Statement 3
Executive Compensation Program Highlights
The following table summarizes certain executive compensation practices that we have implemented to reward performance without encouraging inappropriate or excessive risk-taking and align executives’ interests with shareholders’ interests, as well as practices that we avoid because we do not believe they would serve the long-term interest of the shareholders.
| What We Do | ✓ The vast majority of pay is variable or “at risk”, i.e., performance-based or equity-based or both. ✓ We include challenging performance objectives in annual and long-term incentive awards that encourage value creation for shareholders. ✓ We cap annual incentive and long-term performance award payouts at 200% of target. ✓ We utilize an independent compensation consultant. ✓ We maintain significant stock ownership requirements (6x base salary for CEO). ✓ We generally provide for three-year performance periods/vesting in long-term awards. ✓ We provide limited perquisites with reasonable business rationale. ✓ We regularly assess the risk-reward balance of our compensation programs. ✓ We include clawback provisions in our key compensation programs and our executive officers are subject to a compensation recovery policy in the event of certain misstatements. |
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| What We Don’t Do | X We prohibit hedging, pledging, or short sales of Company stock by directors and executive officers. X No single trigger provisions for cash severance. X We do not provide cash severance payments exceeding 2x salary and target annual incentive award (plus prorated bonus for year of termination, if earned). X We no longer provide change of control excise tax gross-ups to executive officers. X We prohibit repricing or replacing underwater stock options or stock appreciation rights. |
4 Caleres | 2024 Proxy Statement
PROXY STATEMENT
FOR THE CALERES, INC.
2024 ANNUAL MEETING OF SHAREHOLDERS
The text of this filing, as the company filed it with the SEC, without its images or exhibits. This is not investment advice.