Annual Meeting of Stockholders Meeting Date: October 7, 2024 Time: 11:00 a.m. Held Virtually at: www.virtualshareholdermeeting.com/CRS2024 Record Date: August 8, 2024
This summary gives you an overview of selected information in this year’s proxy. Please read the entire proxy before voting.
Agenda and Voting Matters
| Proposal | Board Recommendation | Page Reference |
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| 1. Election of three directors to three-year terms expiring in 2027 | For all nominees | 10 |
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| 2. Ratification of PricewaterhouseCoopers LLP as our independent auditors for fiscal year 2025 | For | 35 |
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| 3. Advisory vote to approve the compensation of our named executive officers | For | 39 |
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Director Nominees: Terms to Expire 2027
| Name | DirectorSince | | Experience and Qualifications | | Board Committees | | Board Tenure | |
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| Dr. A. John Hart | | 2019 | | Research and Development, Key Industry, Innovation and Strategic Experience | | ▶ Science, Technology and Sustainability (Co-Chair) ▶ Audit/Finance | | 5 years |
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| Kathleen Ligocki | | 2017 | | Chief Executive Officer, International, Key Industry, Operational Manufacturing and Financial Experience | | ▶ Human Capital Management (Chair) ▶ Corporate Governance ▶ Strategy | | 7 years |
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| Ramin Younessi | | 2021 | | Operational Manufacturing, Financial, International, and Research and Development Experience | | ▶ Audit/Finance ▶ Science, Technology and Sustainability | | 3 years |
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| 6 | CARPENTER TECHNOLOGY 2024 PROXY STATEMENT |
Proxy Summary • Governance Highlights
Governance Highlights
Our commitment to good corporate governance is illustrated by the following practices:
| ▶ | Board independence (nine out of ten directors are independent) |
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| ▶ | Strong corporate governance guidelines and policies |
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| ▶ | Diversity of Board skills and experience |
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| ▶ | Robust stock ownership guidelines for Directors and Executive Management |
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| ▶ | Directors attended all Board and Committee meetings in fiscal year 2024 |
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| ▶ | Separate Chairman and Chief Executive Officer |
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| ▶ | Succession planning process |
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| ▶ | Majority voting with Director resignation policy for uncontested elections |
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| ▶ | Stockholder outreach program |
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| ▶ | Director training and education |
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| ▶ | Annual Board and Director evaluations |
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| ▶ | Mandatory retirement policy |
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| ▶ | Board risk oversight and assessment |
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| ▶ | Independent Directors meet in executive sessions without management present |
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Compensation Governance Practices
Our executive compensation program reflects the Board’s strong commitment to good governance.
| What we do |
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| Balanced portfolio: The program design provides a balanced mix of cash and equity, annual and long-term incentives, and performance metrics (financial and operational goals). Double-trigger benefits: We have a double-trigger for change-in-control separation benefits. This means that a Change in Control of Carpenter Technology alone does not trigger any severance obligations to our Named Executive Officers (NEOs) under our Change-in-Control Severance Plan (as defined below) or vesting of awards. Clawback policies: We maintain two clawback policies that apply to both annual cash bonuses and short- and long-term cash incentives, as well as equity incentive awards for NEOs and other senior executives. These include our Clawback Policy for Executive Officers, which complies with SEC and NYSE rules. Key practices: The Human Capital Management Committee analyzes performance against robust and diversified performance metrics, ensures substantial equity ownership guidelines, annually reviews compensation peer groups, and provides and oversees limited perquisites. | Equity ownership guidelines: We maintain equity ownership guidelines that require Corporate Vice Presidents and above to achieve an equity ownership level, over a five-year period, equal to a certain multiple of base salary. For the CEO, the level is 5x base salary; for Senior Vice Presidents, 3x base salary; and for Corporate Vice Presidents, 2x base salary. Independent compensation consultants: We engage independent compensation consultants who provide information to support the Human Capital Management Committee’s work, including a peer group analysis, market compensation data, and an analysis of various compensation instruments and metrics. Risk assessment: The Human Capital Management Committee reviews an annual assessment by an independent compensation consultant to confirm that metrics and goals are appropriate to drive high performance without encouraging risk-taking beyond established risk parameters. |
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| CARPENTER TECHNOLOGY 2024 PROXY STATEMENT | 7 |
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Proxy Summary • Compensation Governance Practices
| What we don’t do |
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| Excise tax gross-ups: The compensation program does not include any change-in-control tax gross-ups to our executives. Dividend payments or accruals on unearned restricted stock units (“RSUs”): We do not pay or accrue dividends on unearned RSUs. Dividend equivalents will only be paid on time-based RSU awards upon satisfaction of the terms and conditions applicable to the underlying RSUs. Additionally, no dividend equivalent rights are granted on shares underlying stock options. Excessive perquisites: We do not provide excessive perquisites to our NEOs. Those offered are primarily financial and tax counseling, tax preparation, medical examinations, individual disability income protection plans, relocation expenses and parking fees at our Philadelphia headquarters. | Hedging/pledging of company stock: Our policy prohibits hedging or pledging of Carpenter Technology stock by NEOs. Option repricing: Our long-term incentive program does not permit repricing of stock options without stockholder approval. Additionally, the plan does not permit Carpenter Technology to offer a cash buyout of underwater options. Employment contracts: We do not provide employment contracts to our NEOs. |
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| 8 | CARPENTER TECHNOLOGY 2024 PROXY STATEMENT |
Proxy Summary • Stockholder Engagement and Advisory Say-On-Pay Vote
Stockholder Engagement and Advisory Say-On-Pay Vote
We have provided stockholders with an annual advisorysay-on-pay vote on our NEOs’ compensation since 2012. We are very pleased that stockholders have expressed their continued support of our compensation practices.
| 2023 Say-on-Pay Vote Last year, approximately 98% of the votes cast were in favor of our Say-on-Pay proposal. Approximately 99% and 97% of the votes cast at our 2022 and 2021 annual meetings, respectively, were in favor of our Say-on-Pay proposal. | On average, approximately 98% of votes cast from 2021-2023 were in favor of our advisory Say-on-Pay proposals. |
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Pay for Performance
Our compensation program targets market median positioning but is strongly focused on delivering a substantial portion of that compensation through performance-based compensation elements. This ensures proper alignment with our stockholders and ties the ultimate value delivered to NEOs (above/below target) to Carpenter Technology’s performance.
Target Direct Compensation Mix – CEO
Target Direct Compensation Mix – NEOs*
| * | Represents target pay mix for Messrs. Lain, Malloy, Dee and Akins. |
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| CARPENTER TECHNOLOGY 2024 PROXY STATEMENT | 9 |
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