Equitable Holdings, Inc.
For the period ended May 21, 2025. Filed Apr 4, 2025.
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May 21, 2025 · Filed Apr 4, 2025
Contents
• Compensation Components
The EQH Compensation Program includes the following key components:
| Total Direct Compensation | |
|---|---|
| Base Salary | What is it? Fixed compensation for services. What is the purpose of it? For executives, base salary is intended to provide a fair level of fixed compensation based on the position held, competitive market data, the executive’s career experience, the scope of the position’s responsibilities and the executive’s own performance. |
| Short-Term Incentive Compensation | What is it? Variable annual cash incentive awards determined based on performance relative to corporate and individual goals. What is the purpose of it? Short-term incentive compensation is intended to: • align cash incentive awards with corporate financial results and strategic objectives and reward executives based on corporate and individual performance; • enhance the performance assessment process with a focus on accountability; • differentiate compensation based on individual performance; and • provide competitive total annual compensation opportunities. |
| Equity-Based Awards | What is it? Incentive awards consisting of equity vehicles subject to multi-year vesting requirements based on performance requirements and continued service. What is the purpose of it? Equity-based awards are intended to: • align long-term interests of award recipients with those of stockholders; • provide competitive total compensation opportunities; and • ensure focus on achievement of long-term strategic business objectives. |
| Other Compensation and Benefits | |
| Retirement, Health and other Plans and Programs | What is it? A comprehensive program offering retirement savings, financial protection and other compensation and benefits. What is the purpose of it? Our compensation and benefits program is intended to attract and retain high caliber executives and other employees by offering programs that assist with their long-term financial support and security. |
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| Termination Benefits | |
|---|---|
| Severance Benefits | What is it? Temporary income payments and other benefits provided for involuntary terminations of employment. What is the purpose of it? Severance benefits are intended to treat employees fairly at termination and provide competitive total compensation packages. |
| Change-in-Control Benefits | What is it? Benefits in the event of a termination related to a change-in-control. What is the purpose of it? Change-in-control benefits are intended to retain executives and incent efforts to maximize stockholder value during a change in control. |
Compensation Arrangements
Mr. Pearson is the only EQH Program Participant with an employment agreement. Under the terms of the agreement, Mr. Pearson’s employment will continue until terminated by Mr. Pearson or the Company on 30 days’ prior written notice.
Base Salary
None of the EQH Program Participants other than Mr. Pearson is entitled to a minimum rate of base salary. Under Mr. Pearson’s employment agreement, he is entitled to a minimum rate of base salary of $1,225,000 per year, except that his rate of base salary may be decreased in the case ofacross-the-board salary reductions similarly affecting all Equitable Financial officers who are members of the Management Committee.
The Compensation and Talent Committee reviewed the base salaries of the EQH Program Participants in February 2024, taking into consideration the Independent Compensation Analysis and input from management. Based on the foregoing, no adjustments were made to the base salaries of EQH Program Participants for 2024. The following table shows the annual rate of base salary of the EQH Program Participants:
| EQH Program Participant | 2024Annual Rate of BaseSalary |
|---|---|
| Mr. Pearson | $1,252,000 |
| Mr. Raju | $850,000 |
| Mr. Hurd | $900,000 |
| Mr. Lane | $900,000 |
The base salaries earned by the EQH Program Participants in 2024, 2023 and 2022 are reported in the “Summary Compensation Table” included below.
Short-Term Incentive Compensation
Variable cash incentive awards are generally available for the EQH Program Participants under the Equitable Holdings, Inc. Short-Term Incentive Compensation Plan (the “STIC Plan”). The STIC Plan is an ongoing “umbrella” plan that allows the Compensation and Talent Committee or Board to establish annual programs setting forth performance goals and other terms and conditions applicable to cash incentive awards for employees (each, a “STIC Program”).
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All EQH Program Participants were eligible for awards under the 2024 STIC Program. The amount of an EQH Program Participant’s individual award under the 2024 STIC Program was determined by multiplying their 2024 STIC Program award target (the “STIC Target”) by a funding percentage (the “Final Funding Percentage”) and by their “Individual Assessment Percentage” as further described below. The calculation is as follows, subject to a maximum award of 200% of an executive’s STIC Target:
2024 STIC Target X Final Funding Percentage X Individual Assessment Percentage = 2024 STIC Program Award
This section describes each element of the award calculation.
STIC Targets
The Compensation and Talent Committee reviewed the STIC Targets of the EQH Program Participants in February 2024, taking into consideration the Independent Compensation Analysis and input from management, and made adjustments to the targets for both Messrs. Raju and Lane to ensure they remained competitive with market rates. The following table shows the 2024 STIC Targets of the EQH Program Participants: :
| EQH Program Participant | STIC Target |
|---|---|
| Mr. Pearson | $3,148,000 |
| Mr. Raju | $1,300,000 |
| Mr. Hurd | $1,500,000 |
| Mr. Lane | $1,400,000 |
We generally do not provide guaranteed annual incentive awards for any executives, except for certain limited guarantees for new hires. No EQH Program Participants were guaranteed a cash incentive award under the 2024 STIC Program.
Final Funding Percentage
Performance Objectives
A preliminary funding percentage (the “Initial Funding Percentage”) for each STIC Program is determined by measuring corporate performance with respect to certain financial and other performance objectives reflecting our key performance indicators. Several key performance objectives are chosen to incent performance across a range of activities and balance different types of metrics.
Based on its review of the 2023 STIC Program in February 2024, the Compensation and Talent Committee elected to retain the four performance objectives (i.e., non-GAAP Operating Earnings, VNB, Cash Flow and Strategic Initiatives), as well as to retain the same overall relative weightings for the 2024 STIC Program. Recognizing that the performance objectives and their weightings for each STIC Program are determined based on our strategy and focus at the time of the program’s design, performance objectives and their weightings may vary in future years as different metrics become more relevant.
The 2024 STIC Program performance objectives and their relative weightings were as follows:
| • | Non-GAAP Operating Earnings – 25% |
| • | VNB – 25% |
| • | Cash Flow – 25% |
| • | Strategic Initiatives – 25% |
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| Non-GAAP Operating Earnings | |
|---|---|
| What is it? | Non-GAAP Operating Earnings is an after-tax financial measure used to evaluate our financial performance that is determined by making certain adjustments to our after-tax net income (loss) attributable to Holdings. Specifically, it excludes items that can be distortive or unpredictable from the results of operations and focuses on corporate performance with respect to ongoing operations. Accordingly, it is used as the basis for management’s decision-making. Non-GAAP Operating Earnings is a financial measure that is not computed in accordance with U.S. GAAP. Please see Appendix A for a more complete description of the calculation of Non-GAAP Operating Earnings. |
| Why do we use it? | Non-GAAP Operating Earnings was chosen as a performance objective for the 2024 STIC Program due to our belief that it is the strongest indicator of corporate performance for a year. |
| Value of New Business | |
| What is it? | The VNB performance objective: • represents the present value of economic profits from new business under the Company’s economic model; • is a key pricing metric established during the product approval process and monitors actual versus expected economic returns; • is a key component of franchise value (i.e., the value of future potential new business) and is part of the Company’s economic value and economic coverage ratio; and • is measured in terms of absolute value (i.e., dollars or present value economic profit) and relative value by measuring VNB margin (i.e., absolute value as a percentage of certain new business annual premium equivalent). Management has the ability to manage VNB through active management of certain new business sales and pricing. |
| Why do we use it? | VNB was chosen as a performance objective for the 2024 STIC Program due to our belief that it is a strong indicator of economic value creation of certain new business sold over the course of a year. |
| Cash Flow | |
| What is it? | Cash Flow is net annual dividends and distributions to Equitable Holdings from its subsidiaries less annual Holding Company expenses. |
| Why do we use it? | Cash Flow was chosen as a performance objective for the 2024 STIC Program to ensure management is held accountable for the metrics communicated to investors and the market as most important to the Company. It is linked to longer-term sustainable earnings growth. |
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| Strategic Initiatives | |
|---|---|
| What is it? | The Strategic Initiatives performance objective measured corporate performance with respect to specific 2024 goals set for certain initiatives required to ensure Holdings’ continued success, including: • Deliver meaningful value for our stakeholders including our people, clients and communities; • Demonstrate meaningful improvements on building new commercial growth engines to grow franchise value; • Set the strategy and show meaningful progress on Efficiency Moonshot to support business growth; and • Set the strategy and show meaningful progress on our capital optimization initiative to support investor commitments. |
| Why do we use it? | The Strategic Initiatives were chosen as a performance objective for the 2024 STIC Program to ensure employees’ focus on the critical activities required to ensure our future success. |
Calculation of Initial Funding Percentage
The Initial Funding Percentage was determined based on corporate performance with respect to targets approved by the Compensation and Talent Committee for each performance objective. For Non-GAAP Operating Earnings, VNB, and Cash Flow, the targets were numerical. For each Strategic Initiative, the target was set as the accomplishment of the 2024 goal for that initiative. Once set, the targets for each performance objective are not permitted to change during the course of the year except for exceptional circumstances as determined by the Compensation and Talent Committee.
Performance at target for a performance objective results in a contribution to the Initial Funding Percentage equal to that performance objective’s weighting. Accordingly, performance at target for all of the performance objectives would result in an Initial Funding Percentage of 100%. Performance below target for a performance objective results in a decreased contribution to the Initial Funding Percentage down to a minimum of 0%. Performance above target for a performance objective results in an increased contribution to the Initial Funding Percentage up to a maximum of twice the performance objective’s weighting. Accordingly, the Initial Funding Percentage could range from 0% to 200%.
The Non-GAAP Operating Earnings, VNB and Cash Flow performance objectives were also assigned threshold and maximum achievement levels that were approved by the Compensation and Talent Committee. The threshold and maximum goals for the Non-GAAP Operating Earnings, VNB and Cash Flow performance objectives were set at +/- 25% of target. Performance at the maximum or higher for a performance objective results in that performance objective’s maximum contribution to the Initial Funding Percentage. Performance below threshold results in no contribution to the Initial Funding Percentage by the performance objective.
The Strategic Initiatives’ performance objective was not assigned specific thresholds or maximums. Rather, its contribution to the Initial Funding Percentage (which could range from 0% to 50% as described above) was determined by a qualitative assessment of performance, supported by indicators and considering a holistic assessment of business performance over the past year, subject to approval by the Compensation and Talent Committee.
The Initial Funding Percentage of the annual incentive was 160% of target (i.e., Non-GAAP Operating Earnings (28%) + VNB (50%) + Cash Flow (50%) + Strategic Initiatives (32%)). The following table presents the target and actual results for each of the performance objectives, along with their thresholds, maximums, relative weightings and ultimate contribution to the Initial Funding Percentage. All amounts listed for thresholds, maximums, target and actual results are in millions of U.S. dollars.
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VNB for 2024 STIC Program purposes was $757 million, $24 million less than 2024 reported VNB of $781 million. The STIC Program framework provides the ability to make adjustments, including to eliminate the impact ofnon-recurring events or actuarial assumption updates related to Legacy business lines. The downward adjustment of $24 million is related to a margin assumption update for our Group Retirement Business.
| Performance Objective | Threshold($m) | Target | Maximum | Weight | ActualResults | Contributionto InitialFundingPercentage |
|---|---|---|---|---|---|---|
| Non-GAAP Operating Earnings | 1,463 | 1,950 | 2,438 | 25% | 2,007 | 28% |
| VNB | 438 | 584 | 730 | 25% | 757 | 50% |
| Cash Flow | 900 | 1,200 | 1,500 | 25% | 1,500 | 50% |
| Strategic Initiatives | N/A | Goalsexceeded | N/A | 25% | 130% | 32% |
| Total | 160% | |||||
| Note: | For results in between the threshold and target and target and maximum, the contribution to the Initial Funding Percentage is determined by linear interpolation. Actual VNB results used for 2024 STIC Program purposes excludes VNB from certain newer businesses. |
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The Compensation and Talent Committee determined that the Strategic Initiatives performance objective’s contribution to the Initial Funding Percentage would be 130%, with some goals being evaluated as above target. Key performance objective results included:
| • | Delivered meaningful value for our stakeholders, as evidenced by strong employee engagement scores that outpace the finance and insurance benchmarks, the completion of our first public Principles for Responsible Investing report, the commitment of c. $390 million towards impact investments in support of our goal to commit up to $1 billion towards impact investments by year-end 2025. |
| • | Robust business growth momentum with record full year net inflows of $7.1 billion in our Core Retirement businesses and $4 billion in Wealth Management, along with c. $600 million initial in-plan annuity inflows from Blackrock. In addition, we announced a new in-plan annuity partnership with J.P. Morgan Asset Management, building on our momentum as a leader in the growing in-plan annuity market. |
| • | Our Efficiency Moonshot strategy was formalized with the launch of a new framework for budgeting and corporate investments, increasing the speed and transparency of our decision-making process and resulting in the achievement of $100 million of run-rate expense savings in 2024. |
| • | Significant progress was made on our capital optimization initiative, including the establishment of our Bermuda reinsurance subsidiary to support consistent cash flows and optionality, our investment in RGA’s Ruby Re sidecar vehicle to provide access to third-party capital and the close of the Bernstein Research Services (BRS) joint venture transaction, along with enhancements to our hedging strategy and financial reporting framework. |
Determination of Final Funding Percentage
Once the Initial Funding Percentage was calculated as described above, it was reviewed by the Compensation and Talent Committee which had responsibility for determining the Final Funding Percentage. In making its determination, the Compensation and Talent Committee had discretion to increase the Initial Funding Percentage by up to twenty percentage points and unlimited discretion to decrease the percentage based on any relevant circumstances determined by the Committee, provided that it could not increase the Initial Funding Percentage above the maximum of 200%.
The 2024 STIC Program target for Cash Flow was $1,200 million. Subsequent to the establishment of this target, the Company’s regulators approved a $300 million extraordinary dividend. Final Cash Flow results for 2024 were
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$1,500 million, inclusive of this special dividend. Management recommended, and the Compensation and Talent Committee agreed, to exclude $200 million of this special dividend from the final assessment of performance against the Cash Flow target, resulting in a reduction of 18 points for the Cash Flow metric score, leading to a Final Funding Percentage of 142%.
Individual Assessment Percentage and Approval of Awards
An EQH Program Participant’s Individual Assessment Percentage is based on his individual performance and demonstrated leadership behaviors and can range from 0% to 130%. The Compensation and Talent Committee reviewed the 2024 performance of each EQH Program Participant as well as Mr. Pearson’s recommendations for each EQH Program Participant’s Individual Assessment Percentage (other than for himself) and 2024 STIC Program award. Based on its assessment of each EQH Program Participant’s performance, the Compensation and Talent Committee approved the amount of the 2024 STIC Program awards for each EQH Program Participant.
In making its recommendations, the Compensation and Talent Committee took into account the factors that it deemed relevant, including the following accomplishments achieved in 2024 by the EQH Program Participants.
| Mr. Pearson | |
|---|---|
| Accomplishments | Strong business performance and on track against Investor Day targets, including: • Delivered $2 billion of Non-GAAP Operating Earnings, or $5.93 per share, up 29% year over year on a per share basis. • Reached milestone of over $1 trillion of assets under management and administration. • Growth momentum across the businesses with net inflows of $7.1 billion in Retirement, $4.0 billion in Wealth Management and AB active net inflow of $4.3 billion. • Achieved $100 million of run-rate expense reductions through year-end, on track to deliver $150 million target by 2027. • Realized over $80 million of incremental net investment income through year-end, ahead of plan to achieve $110 million by 2027. Maintained balance sheet strength and consistent capital return, including: • $1.5 billion of cash generation, at upper end of the $1.4-1.5 billion guidance on track for $2 billion by 2027. • Returned $1.3 billion of capital to shareholders resulting in a 66% payout ratio, in line with 60-70% target. • Combined National Association of Insurance Commissioners (“NAIC”) RBC ratio of c.425%, above 375-400% guidance. Enhanced governance profile and company culture including: • Earned Gold status from the American Heart Association for workplace well-being programs, improving our score over last year and 13% higher than the average company score. • Improved our corporate engagement index score, exceeding last year’s score and industry benchmark |
| 2024 STIC Program Award | $4,470,160 (142% of target) |
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| Mr. Raju | |
|---|---|
| Accomplishments | Provided leadership and direction for Finance-related activities including: • Achieved $2.0 billion Non-GAAP Operating Earnings or $5.93 per share, exceeded $1 trillion AUM/A, $550 million of capital invested in new business delivering 15% IRRs, and record $775 million value of new business with full year net inflows of $7.1 billion in Retirement and $4.0 billion in Wealth Management. • Delivered Cash Flow to Holdings of $1.5 billion, at the high end of our 2024 guidance, and over 50% of cash generation came from our asset and wealth management businesses. Holdings returned $1.3 billion of capital to shareholders, equating to a 66% payout ratio, consistent with our 60-70% target range. • Maintained a strong combined NAIC RBC ratio of c.425%, above the 375-400% target range, and ended 2024 with $1.8 billion of cash and liquid assets at Holdings. Hedging effectiveness ratio remained above 95%. Executed strategies to enhance financial reporting framework, de-risk the balance sheet, unlock economic value, seed future growth, and generate additional income: • On track for our 2023 Investor Day targets to grow Non-GAAP EPS 12-15% by 2027 and increase cash generation to $2 billion at a faster rate than peers. • Established Equitable Financial Bermuda Re, providing optionality and stability of future cash flows. • Completed innovative refinancing transaction that extended the effective maturity of its existing pre-capitalized trust securities into longer-dated securities that can be relied on for contingent capital going forward. • Achieved $80 million of incremental General Account net investment income, on track to reach $110 million target by 2027. • Delivered $100 million run-rate expense saves as of year-end and on track to complete $150 million target by 2027. Continued to build meaningful synergies with AB, including: • Advanced enterprise growth initiatives, deploying $12 billion of capital to support AB’s higher multiple private markets platform, which grew to $70 billion of AUM. • Made $100 million investment in RGA’s sidecar vehicle, Ruby Re, with the goal of generating an attractive return on invested capital. Delivered value for our stakeholders, including: • Committed c.$390 million towards impact investments, such as in renewable energy and energy efficiency projects. These investments are in support of our new goal to commit up to $1 billion towards impact investments by the end of 2025. • Completed first public Principles for Responsible Investing report. • Integrated material ESG factors into investment process for c.$80 billion of our $114.5 billion General Account assets, enhancing our investment portfolio. • Served as an executive sponsor to CORE (Career, Outlook, Resources, Engage), a talent development program. |
| 2024 STIC Program Award | $2,215,200 (170% of target) |
Mr. Raju’s 2024 STIC Program Award was 170% of target, representing a Final Funding Percentage of 142% and an Individual Assessment Percentage of 120%, based principally on his oversight of our capital optimization efforts, resulting in cash generation of $1.5 billion and a payout ratio of 66%.
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| Mr. Hurd | |
|---|---|
| Accomplishments | Delivered strategic projects that supported growth, enhanced security, modernized our technology infrastructure and improved the efficiency of our organization, including the significant evolution of our Generative AI program. Launched major initiative in 1Q 2024 to significantly reset our expense base and reallocate savings to our highest return opportunities, which includes a new and sustainable efficiency budgeting process, increased speed and transparency in corporate investment decisions, increased investment rigor leveraging digital tools and business cases that capture both financial benefits and improvements to client, and advisor and employee experience while also improving our risk profile. Achieved $100 million of run-rate expense reductions through year-end, on track to deliver $150 million target by 2027. Made significant progress on our strategy to deliver meaningful value to our stakeholders, including: • Continued to cultivate an environment that attracts and retains top talent, fosters productivity and allows our people to develop personally and professionally, including: • Completed Equitable’s transformation to New Ways of Working (NWOW), investing more than 60,000 hours in training on agile methodologies. Evolved NWOW approach with a new area of focus, process reengineering, and added growth and ownership as new tenants to adaptive leadership. • Matured our holistic Wellness program, increasing our American Heart Association (AHA) for workplace well-being score by 13%. Highlights of our 2024 initiatives include hosting our first onsite health and financial wellness fairs and providing energy and resilience management training to more than 1,800 employees. • Strong employee engagement as measured by our culture survey, with an engagement index score at 83%, exceeding last year’s score at 81% and outpacing the finance and insurance benchmark. • Successfully completed construction and relocation to our new headquarters at 1345 Avenue of the Americas, finishing on time and within budget, marking the completion of the Reimagining the Workplace program which resulted in $30 million annual run rate savings and enhanced employee experience. • Supported nearly 9,500 students in their pursuit of higher education and supported more than 4,500 educators with professional development and well-being programs. • Evolved Equitable Excellence Scholarship® program to ensure scholarships reach students in need. In 2024, 63% of Equitable Excellence Scholarship® recipients were first-generation college students (a 7.5% increase from 2023), with 98% of Equitable’s 2024 scholarship recipients returning for their sophomore year, compared to the industry average of 76%. |
| 2024 STIC Program Award | $2,556,000 (170% of target) |
Mr. Hurd’s 2024 STIC Program Award was 170% of target, representing a Final Funding Percentage of 142% and an Individual Assessment Percentage of 120%, based principally on his leadership on several enterprise-wide initiatives, including significantly advancing stakeholder value, advancement of holistic wellness strategy, and establishing a new expense management framework.
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| Mr. Lane | |
|---|---|
| Accomplishments | Delivered record value and volume in Core Retirement businesses (Individual Retirement, Group Retirement and Protection Solutions), including: • $7.1 billion in total Retirement net flows, up 33% vs. 2023. • Delivered $570 million in VNB, a 24% increase year-over-year. • Total Retirement premiums up c.30% vs. 2023, including record sales in Individual Retirement of $18.6 billion, up 30% vs. 2023. Drove strong results in Wealth Management business in its first full year as a standalone segment, including: • Record $4 billion in advisory net flows, up 34% vs. 2023. • Surpassed milestone of $100 billion in AUA, finishing the year up 16% vs. 2023. • Increased total number of Wealth Planners to 825, a 10% increase vs. 2023. • Increased total Equitable Advisors headcount by 4% year-over-year and increased total advisor productivity by 10% year-over-year. Achieved solid results and continued momentum in emerging Employee Benefits and Institutional businesses, including: • Institutional: $600 million in net flows, including flows from BlackRock’s LifePath Paycheck; Launched in the Health Savings Account (“HSA”) market with market leading partner in the HSA space, expecting flows in 2025. • Employee Benefits: Strong top-line growth with Gross Written Premium up 18% vs. 2023, and 900k lives covered, up 13% year-over-year; Continued pricing strategy execution with renewals retention improved by 8ppts (4ppts higher than 2023). Executed on enterprise strategy to optimize capital; drove commercial innovation to build on competitive differentiation and drive sustainable value, including: • Led the Life business transformation: Improved the return on allocated capital by narrowing Life products and channels to those where the business is most competitive, substantially reducing capital consumption and expenses while substantially improving profitability. • Drove commercial innovation: Built capabilities to launch new products and enter new markets in 2025: Multi-Year Guaranteed Annuities (“MYGAs”) for Equitable Advisors, Pooled Employer Plan (“PEP”) market in Group Retirement, and HSA market in Institutional. • Scaling advice model: Over 600 advisors completed the Colombia Credentialed Holistic Coach program, and in 2024 launched Wealth Planner Academy with over 150 advisors participating. Total Wealth Planner headcount reached 825, a 10% increase year-over-year. Strengthened the talent of the organization, with new leadership in Group Retirement and Life. Continued to improve the teams’ leadership skills and drive strong culture scores above the industry average. |
| 2024 STIC Program Award | $2,186,800 (156% of target) |
Mr. Lane’s 2024 STIC Program Award was 156% of target, representing a Final Funding Percentage of 142% and an Individual Assessment Percentage of 110%, based principally on his role in driving sales and new business in 2024, as well as his leadership in transforming our Life business and driving commercial innovation.
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The annual cash incentive awards and bonuses earned by the EQH Program Participants in 2024, 2023 and 2022 are reported in the “Summary Compensation Table” included below.
Equity-Based Awards
In 2024, the Compensation and Talent Committee granted equity-based awards to the EQH Program Participants under the Equitable Holdings, Inc. 2019 Omnibus Incentive Plan (the “2019 Equity Plan”). The 2019 Equity Plan is an umbrella plan that allows the Compensation and Talent Committee to approve the grant of equity-based awards under annual programs with varying terms and conditions. On March 17, 2025, the Compensation and Talent Committee of the Board approved and adopted an amendment and restatement to the 2019 Equity Plan. For a more detailed description of the amendment and restatement of the 2019 Equity Plan, see Proposal 5 of this Proxy Statement.
The Compensation and Talent Committee approves annual grants of equity-based awards at its regularly scheduled February meeting. Equity-based awards may also be granted from time to time as part of asign-on package or retention vehicle. The Compensation and Talent Committee has not delegated any authority to management to grant equity-based awards.
This section describes:
| • | annual equity-based awards that were granted to the EQH Program Participants in 2024 by the Compensation and Talent Committee; and |
| • | 2022 equity-based award results. |
2024 Annual Equity-Based Awards
Each year, the Compensation and Talent Committee approves an equity-based award program for the EQH Program Participants (an “Equity Program”). In February 2024, the Compensation and Talent Committee reviewed the equity vehicles granted under the 2019 Equity Program and their related terms and conditions and elected to keep them largely the same for the 2024 Equity Program, except that Performance Shares were split equally between relative TSR and the newly added Non-GAAP EPS metric, each with a 30% weighting.
Equity Vehicles
The equity-based awards granted under the 2024 Equity Program consisted of a mix of “full value” restricted stock units and Performance Shares. All vehicles contain vesting requirements related to service and the Performance Shares also require the satisfaction of certain performance criteria related to corporate performance to obtain a payout. This mix of equity vehicles was chosen to ensure alignment with corporate performance while facilitating the ability to retain, motivate and reward the executives in the event of changes in the business environment or cycle.
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The dollar value of the awards to each EQH Program Participant was approved by the Compensation and Talent Committee. This dollar value was then allocated between the different equity vehicles. Performance Shares received the highest allocation in accordance with ourpay-for-performance culture. All individual equity grants were approved by the Compensation and Talent Committee at its regularly scheduled meeting on February 13, 2024, with a grant date of February 14, 2024. The following table provides an overview of the different equity vehicles.
| Vehicle | Description | Type | Payout Requirements | Allocation Percentage |
|---|---|---|---|---|
| EQH RSUs | Restricted stock units that will be settled in shares of Holdings’ common stock. | Full Value | Service | 40% |
| EQH TSR Performance Shares | Performance Shares that will be settled in shares of Holdings’ common stock. | Full Value | Service and Satisfaction of Relative TSR Performance Criteria | 30% |
| EQH Non-GAAP EPS Performance Shares | Performance Shares that will be settled in shares of Holdings’ common stock. | Full Value | Service and Satisfaction of Non-GAAP EPS Performance Criteria | 30% |
EQH RSUs. EQH RSUs have a vesting schedule of three years, withone-third of the grant vesting on each of February 28, 2025, February 28, 2026, and February 28, 2027. EQH RSUs receive dividend equivalents with the same vesting schedule as their related units. The value of EQH RSUs will increase or decrease depending on the price of Holdings’ common stock.
EQH Performance Shares. EQH Performance Shares cliff vest after three years on February 28, 2027. EQH Performance Shares receive dividend equivalents subject to the same vesting schedule and performance conditions as their related shares and were granted unearned. Two types of EQH Performance Shares were granted in 2024:
| • | TSR Performance Shares. EQH Performance Shares that may be earned based on Holdings’ total stockholder return relative to its performance peer group (“Relative TSR”); and |
| • | Non-GAAP EPS Performance Shares. EQH Performance Shares that may be earned based on Holdings’ growth in Non-GAAP Operating Earnings Per Share (“Non-GAAP EPS”). |
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Relative TSR and Non-GAAP EPS were chosen as the performance metrics for the EQH Performance Shares because they are important to our stockholders and represent the degree to which we create value for investors relative to peers, and reflect performance not captured in our STIC Program. The use of relative TSR as a performance metric ensures that TSR outperformance versus peers is rewarded with above-target payouts, while TSR underperformance versus peers is reflected with potential below-target (or no) payouts. The addition of Non-GAAP EPS as a performance metric ensures that management is focused on achieving the metrics communicated as most important to the market and, together with relative TSR, can be viewed as the input/output to value creation for stockholders.
| Relative TSR | |
|---|---|
| What is it? | Relative TSR compares the total amount a company returns to investors during a designated period, including both share price appreciation and dividends, to such amounts returned by the company’s peers. |
| Why do we use it? | Relative TSR was selected as a performance metric to ensure that payouts are aligned with the experience of Holdings’ stockholders and to create incentives to outperform peers. |
| Non-GAAP EPS | |
| What is it? | Non-GAAP EPS will be measured using Non-GAAP Common Operating Earnings less preferred stock dividends divided by diluted common shares outstanding. The Compensation and Talent Committee views Non-GAAP EPS as an important financial measure of profitability. |
| Why do we use it? | Non-GAAP EPS growth of 12-15% has been communicated to the market as a key financial goal through 2027. It was selected as a performance metric to ensure management is focused on achieving the metrics communicated as most important to the market. |
TSR Performance Shares. The number of TSR Performance Shares that are earned will be determined at the end of a performance period (January 1, 2024 – December 31, 2026) by multiplying the number of unearned TSR Performance Shares by the “TSR Performance Factor.” The TSR Performance Factor will be determined as follows:
| If Relative TSR for the TSR Performance Period is | The TSR Performance Factor will equal |
|---|---|
| 87.5th percentile or greater (maximum) | 200% |
| 50th percentile (target) | 100% |
| 30th percentile (threshold) | 25% |
| Below 30th percentile | 0% |
| Note: | For results in between the threshold and target and target and maximum amounts, the TSR Performance Factor will be determined by linear interpolation. |
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The Compensation and Talent Committee reviewed the peer group used for determining Relative TSR (the “TSR Peer Group”) under the 2024 TSR Performance Share grants with Meridian and determined to add one new company, Corebridge Financial, to the TSR Peer Group based on its close correlation to EQH in terms of stock price fluctuation and in order to ensure that the TSR Peer Group size remains sufficiently robust. The 2024 TSR Peer Group includes:
| 2024 TSR Peer Group | |
|---|---|
| Ameriprise Financial, Inc. Brighthouse Financial, Inc. Corebridge Financial CNO Financial Group, Inc. Globe Life Inc. Jackson Financial, Inc. Lincoln National Corporation | Manulife Financial Corporation MetLife, Inc. Principal Financial Group, Inc. Prudential Financial, Inc. Sun Life Financial, Inc. Unum Group Voya Financial, Inc. |
| 44 | Notice of Annual Meeting of Stockholders and 2025 Proxy Statement |
Non-GAAP EPS Performance Shares. The number of Non-GAAP EPS Performance Shares that are earned will be determined at the end of a performance period (January 1, 2024 – December 31, 2026) by multiplying the number of unearned Non-GAAP EPS Performance Shares granted by the “Final Non-GAAP EPS Performance Factor.” The Final Non-GAAP EPS Performance Factor will be determined by averaging the “Non-GAAP EPS Performance Factor” for each of the three calendar years in the Non-GAAP EPS Performance Period. Specifically, the Company will be assigned target, maximum and threshold amounts for Non-GAAP EPS for each of 2024, 2025 and 2026 that will determine the Non-GAAP EPS Performance Factor for the applicable year as follows:
| If Non-GAAP EPS for the Non-GAAP EPS Performance Period is | The Non-GAAP EPS Performance Factor will equal |
|---|---|
| Maximum amount (or greater) | 200% |
| Target amount | 100% |
| Threshold amount | 25% |
| Below threshold | 0% |
| Note: | For results in between the threshold and target and target and maximum amounts, the Non-GAAP EPS Performance Factor will be determined by linear interpolation. |
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Equity Targets
The Compensation and Talent Committee reviewed the Equity Targets of the EQH Program Participants in February 2024, taking into consideration the Independent Compensation Analysis and input from management. Based on the Independent Compensation Analysis and/or recommendations by the Compensation and Talent Committee, adjustments were made to the Equity Targets for Messrs. Pearson, Raju and Lane to better align with equity compensation levels of our peer companies. The following table shows the Equity Targets of the EQH Program Participants for 2024:
| EQH Program Participant | 2024 EquityTarget |
|---|---|
| Mr. Pearson | $11,600,000 |
| Mr. Raju | $2,650,000 |
| Mr. Hurd | $2,350,000 |
| Mr. Lane | $2,700,000 |
We do not provide guaranteed equity-based awards for any employees, except for certain limited guarantees for new hires. No EQH Program Participant was guaranteed an award under the 2024 Equity Program.
Award Amounts
Each EQH Program Participant received an award under the 2024 Equity Program. The Compensation and Talent Committee determined the U.S. dollar value of each award based on the EQH Program Participants’ Equity Targets, its review of each executive’s potential future contributions, its consideration of the importance of retaining the executive in their current position and its review of the Independent Compensation Analysis.
The amounts granted to the EQH Program Participants were as follows:
| EQH Program Participant | Total U.S. Dollar Value ofAward |
|---|---|
| Mr. Pearson | $11,600,000 |
| Mr. Raju | $2,650,000 |
| Mr. Hurd5 | $2,500,000 |
| Mr. Lane | $2,700,000 |
| 5 | Mr. Hurd received a discretionary increase in his 2024 Equity Program award grant of $150,000. |
| Notice of Annual Meeting of Stockholders and 2025 Proxy Statement | 45 |
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The amounts granted were determined as follows:
| To determine the amount of: | Percentage of the total award value was divided by: |
|---|---|
| EQH RSUs | 40% of the total award value was divided by the fair market value of Holdings’ common stock on grant date |
| TSR Performance Shares | 30% of the total award value was divided by a fair value determined using a Monte Carlo valuation |
| Non-GAAP EPS Performance Shares | 30% of the total award value was divided by the fair market value of Holdings’ common stock on grant date |
Termination of Employment and Restrictive Covenants
Generally, if an EQH Program Participant terminates employment, his equity-based awards will be forfeited with certain exceptions in the case of involuntary termination without cause on or after the first anniversary of the grant date and termination due to death or disability. Also, in the event that an EQH Program Participant who satisfies the Rule of 65 (i.e., (i) age plus years of service equals at least 65; (ii) is at least 55 years old; and (iii) has at least five years of service) terminates employment on or after the first anniversary of the grant date of an equity-based award, that particular equity-based award will continue to vest, subject to any applicable performance criteria.
In the event that an EQH Program Participant who retains all or a portion of his equity-based award following termination of employment violates certainnon-competition andnon-solicitation covenants contained in his award agreement, any remaining portion of his award at the time of violation will be immediately forfeited. Also, any portion of his award that vested after termination, and any shares or cash issued upon exercise or settlement of that vested portion, will be immediately forfeited or paid to the Company together with all gains earned or accrued. Lastly, a clawback provision in the 2024 equity-based awards provides for the clawback of any shares or cash issued upon exercise or settlement of an award that vested within a 12-month period prior to his termination date, if he was found to be in violation of thenon-solicitation (i.e., of employees and customers) provision in his award agreement.
Detailed information on the 2024 Equity Program awards for each of the EQH Program Participants is reported in the “2024 Grants of Plan-Based Awards Table” included below
2022 EQH Equity-Based Award Results
In February 2025, participants in the EQH Compensation Program received payouts with respect to TSR Performance Shares granted in February 2022 for the three-year performance period ended December 31, 2024.
The performance factor for the TSR Performance Shares was 145.6%, calculated as follows:
| Relative TSR | TSR Performance Factor | Actual Results forPeer Group |
|---|---|---|
| 87.5th percentile or greater (maximum) | 200% | +94.5% |
| 50th percentile (target) | 100% | +29.2% |
| 30th percentile (threshold) | 25% | +21.7% |
The Company’s TSR for the performance period of 57.8% fell between the 50 th and 87.5 th percentile for the peer group and the corresponding performance factor was 145.6%
| 46 | Notice of Annual Meeting of Stockholders and 2025 Proxy Statement |
Other Compensation and Benefit Programs
Benefit Plans
All Equitable Financial employees, including the EQH Program Participants, are offered a benefits program that includes health and disability coverage, life insurance and various deferred compensation and retirement benefits. In addition, certain benefit programs are offered for executives that are not available tonon-executive employees. The overall program is periodically reviewed to ensure that the benefits it provides continue to serve business objectives and remain cost-effective and competitive with the programs offered by large diversified financial services companies.
| Qualified Retirement Plans | |
|---|---|
| Why do we offer them? | We believe that qualified retirement plans encourage long-term service and provide a meaningful vehicle to save for retirement. |
| What plans are offered? | The Equitable 401(k) Plan (the “401(k) Plan”) The 401(k) Plan is a tax-qualified defined contribution plan offered for eligible employees who may contribute to the 401(k) Plan on a before-tax, after-tax or Roth 401(k) basis (or any combination of the foregoing) up to tax law and plan limits. The 401(k) Plan also provides for matching contributions and employer contributions as follows: • the matching contribution for a calendar year is 5% so that participants’ voluntary deferrals under the plan of up to 5% of their annual eligible compensation will be matched dollar-for-dollar by the Company; and • the employer contribution for a calendar year is 4% of eligible compensation up to the qualified plan compensation limit ($345,000 in 2024). All of the EQH Program Participants were eligible to participate in the 401(k) Plan in 2024. The Equitable Retirement Plan (the “Retirement Plan”) The Retirement Plan is a tax-qualified defined benefit plan that was previously offered to eligible employees. Prior to its freeze in December 2013, the Retirement Plan provided a cash balance benefit. Mr. Pearson, Mr. Raju and Mr. Lane participate in the Retirement Plan. In October 2024, the Company announced that effective January 1, 2025 the employer contribution under the 401(k) Plan would cease, and instead, the Retirement Plan would be re-opened and EQH Program Participants would receive a pay credit equal to 4% of eligible compensation up to the qualified plan compensation limit and interest credits under a cash balance formula. The matching contribution under the 401(k) Plan will continue to be provided. |
| Financial Protection Plans | |
|---|---|
| Why do we offer them? | We believe that health, life insurance, disability and other financial protection plans are basic benefits that should be provided to all employees. |
| What plans are offered? | The Equitable Executive Survivor Benefits Plan (the “ESB Plan”) In addition to our generally available financial protection plans, certain grandfathered employees (including Messrs. Pearson, Hurd and Lane), participate in the ESB Plan which offers benefits to a participant’s family in the case of their death. Eligible employees may choose up to four levels of coverage and the form of benefit to be paid at each level. Each level provides a benefit equal to one times the participant’s eligible compensation and offers different coverage choices. Generally, the participant can choose between a life insurance death benefit and a deferred compensation benefit payable upon death at each level. The ESB Plan was closed to new participants on January 1, 2019. |
| Notice of Annual Meeting of Stockholders and 2025 Proxy Statement | 47 |
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For additional information on 401(k) Plan benefits for the Named Executive Officers see the “Summary Compensation Table” included below. For additional information on Retirement Plan, Excess Plan and ESB Plan benefits for the EQH Program Participants, see the “Pension Benefits Table” included below.
Perquisites
EQH Program Participants receive onlyde minimis perquisites.
Pursuant to his employment agreement, Mr. Pearson is entitled to unlimited personal use of a car and driver, financial planning and excess liability insurance coverage.
The incremental costs of perquisites for the EQH Program Participants during 2024 are included in the column entitled “All Other Compensation” in the “Summary Compensation Table” included below.
Termination Benefits
Severance Benefits
We provide severance benefits to treat employees fairly at termination and provide competitive total compensation packages. Our severance benefits are summarized below.
| Plan | Benefits |
|---|---|
| The Equitable Severance Benefit Plan (the “Severance Plan”) | The Severance Plan provides temporary income and other severance benefits to all eligible employees following certain involuntary terminations of employment. Temporary income payments are generally based on length of service or base salary. Payments are capped at the lesser of 52 weeks of base salary and $300,000. To obtain benefits under the Severance Plan, participants must execute a general release and waiver of claims against the Company. |
| The Equitable Supplemental Severance Plan for Executives (the “Supplemental Severance Plan”) | The Supplemental Severance Plan provides additional severance benefits for the EQH Program Participants other than Mr. Pearson. The Supplemental Severance Plan requires a participant’s general release and waiver of claims to include provisions regarding non-competition and non-solicitation of employees and customers for twelve months following termination of employment. |
| Mr. Pearson’s Employment Agreement | Mr. Pearson waived the right to receive any benefits under the Severance Plan or the Supplemental Severance Plan. Rather, his employment agreement provides that, if his employment is involuntarily terminated other than for cause or death, or Mr. Pearson resigns for “good reason,” Mr. Pearson will be entitled to certain severance benefits, including cash severance pay equal to two times the sum of his salary and short-term incentive compensation (based on the greatest of: (i) his most recent STIC Program award, (ii) his STIC Target and (iii) the average of his three most recent STIC Program awards) and a pro-rated target STIC Program award for the year of termination. The severance benefits are contingent upon Mr. Pearson releasing all claims against the Company and his entitlement to severance pay will be discontinued if he provides services for a competitor. |
| 48 | Notice of Annual Meeting of Stockholders and 2025 Proxy Statement |
Change in Control Benefits
Change-in-control benefits are intended to retain executives and incent efforts to maximize stockholder value during a change in control. Ourchange-in-control benefits are summarized below.
| Plan | Benefits |
|---|---|
| The Supplemental Severance Plan | In the event of a job elimination or voluntary termination for good reason within twelve months after a change in control of Holdings, the EQH Program Participants, other than Mr. Pearson, are eligible to receive two times the sum of their base salary and short-term incentive compensation. |
| 2019 Equity Plan | Generally, in the event of a change in control of Holdings, equity awards granted under the 2019 Equity Plan that are not assumed or replaced with substitute awards having the same or better terms or conditions would fully vest and be cancelled for the same per share payment made to the stockholders in the change in control (less, in the case of options, the applicable exercise price). |
For additional information on severance and change in control benefits for the EQH Program Participants as of December 31, 2024, see “Potential Payments Upon Termination or Change in Control” below.
The text of this filing, as the company filed it with the SEC, without its images or exhibits. This is not investment advice.