Bath Body Works Inc
For the period ended Jun 27, 2024. Filed May 15, 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.
Jun 27, 2024 · Filed May 15, 2024
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Contents
2024 Proxy Statement Summary
This summary highlights information about Bath & Body Works, Inc. (referred to in this proxy statement as “we,” “us,” “our” and the “Company”) and our upcoming 2024 annual meeting of shareholders contained elsewhere in this proxy statement. This summary does not contain all of the information you should consider. Please carefully read the entire proxy statement before voting.
Your Vote Is Important
How to Vote Your Shares(See Page 70)
You may vote if you were a Company shareholder of record as of the close of business on April 30, 2024.
| Online before the meeting Go to the website designated on the enclosed proxy card or to the website indicated on the materials provided by your broker | By phone Call the phone number designated on the enclosed proxy card or the materials provided by your broker |
| By mail Complete, sign and date the enclosed proxy card and return it promptly in the envelope provided | In person during the annual meeting* Submit a voting ballot at the annual meeting on June 27, 2024 |
| * | If you plan to attend our annual meeting of shareholders in person, please note that you must follow certain procedures, including bringing your photo identification and evidence that you owned your shares as of April 30, 2024, the record date for the annual meeting. Please see “Information About the Annual Meeting and Voting—Attending the Annual Meeting” on page 70 of this proxy statement for additional information. |
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Roadmap for Voting Items
| ITEMS TO BE VOTED ON | VOTE STANDARD | BOARD VOTE RECOMMENDATION | SEE PAGE |
|---|---|---|---|
| Item 1. Election of directors | Majority of votes cast | ☑ FOR EACH NOMINEE | 7 |
| Item 2. Ratification of the appointment of independent registered public accounting firm | Majority of votes present in person or by proxy and voting thereon | ☑ FOR | 25 |
| Item 3. Advisory vote to approve named executive officer compensation | Majority of votes present in person or by proxy and voting thereon | ☑ FOR | 30 |
2024 Proxy Statement| Bath & Body Works, Inc. 1
Our Director Nominees (See Page 8)
The following table provides summary information about the 10 director nominees the Board of Directors (the “Board”) has nominated for election at our 2024 annual meeting of shareholders. Additional information about each nominee’s background and experience can be found beginning on page 11 of this proxy statement.
| COMMITTEE MEMBERSHIPS | ||||||
|---|---|---|---|---|---|---|
| NAME AND PRINCIPAL OCCUPATION | AGE | YEARS OF TENURE | AC | HCCC | NGC | EC |
| Alessandro Bogliolo Independent Former CEO, Tiffany & Co. | 59 | 2.1 | · | ● | ● | · |
| Gina Boswell CEO, Bath & Body Works, Inc. | 61 | 1.4 | ● | ● | ● | ● |
| Lucy Brady Independent President, Snacks & Grocery, Conagra Brands, Inc. | 54 | 1.2 | ● | ● | ● | ● |
| Francis Hondal Independent Former President of Loyalty & Engagement, Mastercard, Inc. | 59 | 3.1 | ● | ● | ● | ● |
| Danielle Lee Independent Former President, Warner Music Artist & Fan Experiences, Warner Music Group Corp. | 48 | 3.1 | ● | ● | ● | ● |
| Sarah Nash Independent Chair of the Company’s Board of Directors; CEO & Owner of Novagard Solutions | 70 | 5.0 | ● | ● | ● | ● |
| Juan Rajlin Independent Vice President & Treasurer, Alphabet Inc. | 49 | 2.1 | ● | ● | ● | ● |
| Stephen Steinour Independent Chairman, President & CEO, Huntington Bancshares Incorporated | 65 | 10.2 | ● | ● | ● | ● |
| J.K. Symancyk Independent President & CEO, PetSmart LLC | 52 | 2.9 | ● | ● | ● | ● |
| Steven Voskuil Independent Senior Vice President & CFO, The Hershey Company | 55 | 1.2 | ● | ● | ● | ● |
| AC Audit HCCC Human Capital & Compensation NGC Nominating & Governance EC Executive ● Committee Member | ||||||
Director Nominee Highlights
Strong Board Diversity
| 5 of 10 Women* | 3 of 10 Members of UnderrepresentedCommunities* | 90% of theNominees Joined the Boardin 2019 or Later | 57 Average Age | 3.2 Years Average Tenure |
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| * | Mses. Boswell, Brady, Hondal, Lee and Nash are our female director nominees. Ms. Hondal and Mr. Rajlin identify as Hispanic or Latino. Ms. Lee identifies as African American or Black. Mr. Rajlin identifies as a member of the LGBTQIA+ community. |
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2 Bath & Body Works, Inc. | 2024 Proxy Statement
Relevant Qualifications, Skills and Experience
We believe that our director nominees, as a whole, possess the optimal mix of qualifications, skills and experience that, taken together, provide us with the variety and depth of knowledge, judgment and vision necessary to provide effective oversight of the Company, including:
TECHNOLOGY
FINANCIAL EXPERTISE
MARKETING, DIGITAL & CONSUMER INSIGHTS
PUBLIC COMPANY CEO / SENIOR LEADERSHIP EXPERIENCE
GLOBAL / INTERNATIONAL
EXECUTIVE BUSINESS EXPERIENCE
GOVERNANCE
OPERATIONS / SUPPLY CHAIN
OMNICHANNEL RETAIL
ENVIRONMENTAL, SOCIAL & GOVERNANCE
Governance Highlights (See Page 18)
The “Corporate Governance” section beginning on page 17 of this proxy statement describes our strong governance framework, which includes:
| ☑ Independent Board Chair | ☑ Separate CEO and Board Chair roles |
|---|---|
| ☑ 9 of 10 director nominees are independent | ☑ Independent directors meet without management present |
| ☑ Board actively involved in overseeing the Company’s long-term business strategy, strategic priorities and material risks | ☑ Each of our standing Board committees is composed of 100% independent directors |
| ☑ Shareholders have the right to call special meetings (25%) | ☑ All directors are elected annually by majority vote |
| ☑ Regular management succession planning | ☑ No supermajority voting requirements |
| ☑ Proxy access rights | ☑ Robust executive officer and director stock ownership guidelines |
| ☑ No shareholders rights plan in effect | ☑ Annual Board and committee self-evaluations |
2024 Proxy Statement| Bath & Body Works, Inc. 3
Our Executive Compensation Program Aligns Pay-for-Performance (See Page 32)
Our executive compensation program is designed to emphasizepay-for-performance and to provide a meaningful and direct link between the interests of our named executive officers (“NEOs”) and those of our shareholders. We employ a pay mix philosophy that focuses on performance-based compensation, and we utilize rigorous performance metrics that align with our strategic direction, provide balance between growth and profitability and are designed to drive total shareholder return.
As described in more detail below, as part of our ongoing efforts to ensure our executive compensation program is aligned with the interests of our shareholders, we undertook a comprehensive shareholder engagement process in fiscal 2023 to better understand our shareholders’ perspectives regarding compensation and governance matters and the key drivers for their voting decisions. Our engagement efforts in 2023 were focused during two main periods – in the spring of 2023 leading up to our 2023 annual meeting of shareholders, and during the fall of 2023 into the winter of 2024 in connection with our implementation of a number of changes to our executive compensation program, as highlighted in the table beginning on the next page. One or more of our Board members participated in meetings with shareholders representing approximately 54% of our shares outstanding as of December 31, 2023. The Chair of our Human Capital & Compensation Committee (“HCC Committee”) participated in 19 of those meetings with shareholders representing approximately 51% of our shares outstanding as of December 31, 2023.
FISCAL 2023 SHAREHOLDER ENGAGEMENT SUMMARY(1)
Spring 2023 Engagement
Fall 2023 and Winter 2024 Engagement
(1) Percentages of shareholders solicited and percentages of shareholders we met with set forth in this chart reflect share ownership as of March 31, 2023 and December 31, 2023 for the “Spring 2023 Engagement” and the “Fall 2023 and Winter 2024 Engagement,” respectively.
As a result of this engagement process and in light of the results of our 2023“say-on-pay” vote, the HCC Committee, in consultation with its independent compensation consultant, promptly implemented specific enhancements to our executive compensation program in fiscal 2023 and 2024 in direct response to shareholder feedback and to further align the interests of our executives with those of our shareholders. In addition to these changes, our executive compensation program normalized in fiscal 2023 and into fiscal 2024 following the completion of our Chief Executive Officer search and transition process in December 2022, in line with our historical philosophy and approach to the compensation of our NEOs.
4 Bath & Body Works, Inc. | 2024 Proxy Statement
The table below highlights the key areas of shareholder feedback we received regarding our executive compensation program during fiscal 2023 and describes the specific actions the HCC Committee took to be responsive to our shareholders.
| WHAT WE HEARD | HOW WE RESPONDED |
|---|---|
| Shareholders expressed concerns with the magnitude of the one-time restricted share unit (“RSU”) award to our Board Chair in fiscal 2022 (as previously disclosed in last year’s proxy statement) | • The HCC Committee committed not to make outsized awards to non-management directors in the future, including if the Company is faced with transformational periods and/or that director assumes a transitional/interim management role. |
| Incentive compensation program should incorporate additional performance measures, including an absolute net sales metric or a capital allocation or returns-based metric | • We added a new relative total shareholder return (“TSR”) metric (compared to the S&P 500 Consumer Discretionary Distribution & Retail Index) to the 2023 performance share units (“PSUs”), which applies in addition to the existing operating income margin metric, each equally weighted, to align compensation outcomes more closely with shareholder returns. The relative TSR metric replaced the relative revenue growth metric that had historically been part of the program. • In addition, we added a “negative absolute TSR cap” to our 2023 PSUs which provides that if our absolute TSR is negative during the applicable performance period, the payout under the 2023 PSU awards is capped at 100% of target performance. • We added a new absolute net sales metric to our 2024 short-term cash incentive program to align with the Company’s business objectives and growth strategy. This enhanced program for fiscal 2024 incents our NEOs to achieve both top- and bottom-line performance. The metrics include absolute adjusted operating income (75% weighting) and absolute net sales (25% weighting). |
| Enhance compensation peer group to include higher performing and/or more consumer-packaged goods (“CPG”) peers | • We added higher performing and more comparable peers to our 2024 Compensation Peer Group (PVH Corp. and Tapestry, Inc.), and we removed Foot Locker, Inc. and Burlington Stores, Inc. We believe the 2024 Compensation Peer Group closely aligns with our business model and merchandise focus and reflects companies that are similar in size and scope, and that compete with us for executive talent. • We assess our peer group annually, which allows us to continue to monitor potential peer group changes and incorporate our shareholders’ feedback. |
2024 Proxy Statement| Bath & Body Works, Inc. 5
| WHAT WE HEARD | HOW WE RESPONDED |
|---|---|
| Enhance the link between compensation program and total shareholder returns, including by increasing emphasis on long-term equity incentives | • The 2023 PSU awards granted to our NEOs included a relative TSR performance measure (with payout capped at target if our absolute TSR is negative) compared to companies in the S&P 500 Consumer Discretionary Distribution & Retail Index. • We enhanced the rigor of our Chief Executive Officer stock ownership guidelines by increasing the number of shares required to be owned from 5x to 6x base salary to further align our Chief Executive Officer’s interests with those of our shareholders over the long-term and better align with market best practice. • As part of the 2024 annual compensation review cycle, the HCC Committee did not increase the base salaries or short-term performance-based incentive compensation targets for our executive officers; rather, only increases in executive officer target long-term equity incentive compensation were approved, thereby enhancing the weighting of our NEOs’ long-term equity compensation as a percentage of their total pay mix. • The HCC Committee increased the proportion of our Chief Executive Officer’s long-term equity incentive compensation that is subject to performance-based conditions from 50% in fiscal 2023 to 60% for fiscal 2024. • We maintain robust compensation recoupment policies that provide for the recovery of incentive and severance compensation, including if an executive engages in certain misconduct or detrimental activities. |
| Retention awards have been granted to NEOs in recent years, including in 2022, and approximately 50% of the awards were subject only to time-based vesting conditions | • We have returned to our normal historical compensation practices following the appointment of Ms. Boswell as Chief Executive Officer, which has provided stability to our senior leadership team. • As a result, no additional retention awards have been made since 2022 and none are currently contemplated for our NEOs. |
We believe these changes directly address our shareholders’ perspectives and strengthen our commitment to ourpay-for-performance philosophy and shareholder value creation. Our robust shareholder engagement process in fiscal 2023 and early 2024, as well as the changes we implemented in light of the constructive feedback we received, exemplify our commitment to engaging with our shareholders.
In addition to the changes made to the compensation program, we note that the compensation actions that were the focus of our 2023 say-on-pay proposal were made during a period of significant uncertainty and transition for the Company. Since that time and looking forward to fiscal 2024 and beyond, our executive compensation program has normalized, and we have remained committed to aligning executive compensation with performance and making decisions that drive our business goals to serve both the short and long-term interests of our shareholders.
6 Bath & Body Works, Inc. | 2024 Proxy Statement
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