Trane Technologies plc
For the period ended Dec 31, 2023. Filed Apr 25, 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.
Dec 31, 2023 · Filed Apr 25, 2024
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Contents
Proxy Voting Roadmap
This summary highlights information contained elsewhere in this Proxy Statement. For more complete information about these topics, please review Trane Technologies plc’s Annual Report on Form 10-K and the entire Proxy Statement.
| ITEM | Election of Directors•11 out of 12 Director nominees are independent.•The Board of Directors is nominating six female directors, one Black director and two non-U.S. directors out of a total of 12 directors.•The tenure and experience of our directors is varied, which brings varying perspectives to our Board functionality. | The Board of Directors recommends a vote FOR the directors nominated for election. |
|---|---|---|
| See page 11 for further information |
Director Nominees
| Director since · Trane Technologies Committees | ||||||||||
|---|---|---|---|---|---|---|---|---|---|---|
| Name/Occupation · Age · Independent · Other Current Public Boards · A · H · S · F · T · E | ||||||||||
| Kirk E. ArnoldAdvisor to General CatalystFormer Chief Executive Officer, Data Intensity | 64 | 2018 | YES | •Ingersoll Rand Inc.•Thomson Reuters | C | M | M | M | ||
| Ana P. AssisChair and General Manager of IBM in Europe, the Middle East and Africa (EMEA) | 50 | 2023 | YES | M | M | M | ||||
| Ann C. Berzin Former Chairman and CEO of Financial Guaranty Insurance Company | 72 | 2001 | YES | M | M | |||||
| April Miller BoiseExecutive Vice President and Chief Legal Officer of Intel Corporation | 55 | 2020 | YES | M | C | M | ||||
| Gary D. ForseeFormer President of University of Missouri System and Former Chairman of the Board and Chief Executive Officer of Sprint Nextel Corporation | 74 | 2007 | YES | •Ingersoll Rand Inc. | M | M | ||||
| Mark R. GeorgeExecutive Vice President and Chief Financial Officer of Norfolk Southern Corporation | 57 | 2022 | YES | M | M | |||||
| John A. HayesFormer Chairman and President and CEO of Ball Corporation | 58 | 2023 | YES | M | M | |||||
| Linda P. HudsonFounder and Former Chairman and CEO of The Cardea Group and Former President and CEO of BAE Systems, Inc. | 73 | 2015 | YES | •Bank of America•TPI Composites, Inc. | M | M | C | |||
| Myles P. LeeFormer Director and CEO of CRH plc | 70 | 2015 | YES | M | C | M | ||||
| David S. RegneryChair and Chief Executive Officer | 61 | 2021 | NO | C | ||||||
| Melissa N. SchaefferSenior Vice President and Chief Financial Officer of Air Products and Chemicals, Inc. | 44 | 2022 | YES | M | M | |||||
| John P. SurmaFormer Chairman and CEO of United States Steel Corporation | 69 | 2013 | YES | •Marathon Petroleum Corporation•MPLX LP (a publicly traded subsidiary of Marathon Petroleum Corporation)•Public Service Enterprise Group | C | M | M | |||
| A | Audit Committee | H | Human Resources and Compensation Committee | S | Sustainability, Corporate Governance and Nominating Committee | C | Chair |
|---|---|---|---|---|---|---|---|
| F | Finance Committee | T | Technology and Innovation Committee | E | Executive Committee | M | Member |
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Board Diversity
One of the three pillars of our 2030 Sustainability Commitments is Opportunity for All. We create new possibilities and a better world for our people and our communities. Oversight of our diversity and inclusion strategy begins with our Board of Directors. Our Human Resources and Compensation Committee regularly reviews diversity and inclusion and other human capital management matters. This commitment to diversity and inclusion extends to our Board of Directors. We know that diverse teams are more innovative and collaborative, capable of solving problems and best positioned to realize a better world for future generations. We believe that diversity of our Board contributes to our long-term strategy and business model.
The Company’s policy on Board diversity relates to the selection of nominees for the Board of Directors. In selecting a nominee for the Board, the Sustainability, Corporate Governance and Nominating Committee considers the skills, expertise and background that would complement the existing Board and ensure that its members are of sufficiently diverse and independent backgrounds, recognizing that the Company’s businesses and operations are diverse and global in nature. Currently, 50% of the Board consists of female directors. The Board intends to continue to select diverse candidates and considers gender diversity and racial and ethnic diversity in each board member search that it conducts. The Board of Directors is nominating six female directors (Ms. Arnold, Ms. Assis, Ms. Berzin, Ms. Miller Boise, Ms. Hudson and Ms. Schaeffer), one Black director (Ms. Miller Boise) and two international directors (Ms. Assis and Mr. Lee) out of a total of 12 directors. In addition, the tenure and experience of our directors is diverse, which brings varying perspectives to our Board functionality.
| GENDER | RACE AND ETHNICITY | NATIONALITY | BOARD SIZE ANDINDEPENDENCE |
|---|---|---|---|
| 11 out of 12 Director Nominees are Independent | |||
| 2024 Proxy Statement | 5 |
|---|
BOARD SKILLS AND EXPERIENCE
| Financial Expert | |
| Finance/Capital Allocation | |
| Global Experience | |
| Technology/Engineering | |
| Services | |
| Human Resources/Compensation | |
| IT/Cybersecurity/Data Management/Digital | |
| Risk Management/Mitigation | |
| ESG/Sustainability | |
| Chair/CEO/Business Head | |
| Industrial/Manufacturing | |
| Academia/Education | |
| Government/Public Policy | |
| Financial Services |
For more information regarding our diversity and inclusion strategy, goals and metrics for our Company generally, please see our ESG Report located on our website at www.tranetechnologies.com/ESG and our “Human Capital Management” disclosure in our Annual Report on Form 10-K for the fiscal year ended December 31, 2023.
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Director Nomination Process
The Sustainability, Corporate Governance and Nominating Committee identifies individuals qualified to become directors and recommends the candidates for all directorships.
| 1 | BOARD COMPOSITION ASSESSMENT |
| The Sustainability, Corporate Governance and Nominating Committee reviews the composition of the full Board to identify the qualifications and areas of expertise needed to further enhance the composition of the Board. | |
| 2 | BOARD RECOMMENDATION |
| The Sustainability, Corporate Governance and Nominating Committee makes recommendations to the Board concerning the appropriate size and needs of the Board including recommendations based on reviews of diversity and the Board’s skill and experience matrix. | |
| 3 | IDENTIFICATION OF CANDIDATES |
| The Sustainability, Corporate Governance and Nominating Committee, with the assistance of management, identifies candidates with the desired qualifications. The Board has used a third-party search firm for all searches conducted in the past seven years and has included a diverse slate of candidates from a gender, racial and ethnic diversity perspective. The Board intends to continue to consider diverse candidates, including from a gender diversity and racial and ethnic diversity perspective, for each available board seat in each board member search that it conducts.In considering candidates, the Sustainability, Corporate Governance and Nominating Committee will consider all factors it deems appropriate, including breadth of experience, understanding of business and financial issues, ability to exercise sound judgment, diversity, leadership, and achievements and experience in matters affecting business and industry. The Sustainability, Corporate Governance and Nominating Committee considers the entirety of each candidate’s credentials and believes that at a minimum each nominee should satisfy the following criteria: highest character and integrity, experience and understanding of strategy and policy-setting, sufficient time to devote to Board matters, and no conflict of interest that would interfere with performance as a director.Shareholders may recommend candidates for consideration for Board membership by sending recommendations to the Sustainability, Corporate Governance and Nominating Committee, in care of the Secretary of the Company. Candidates recommended by shareholders are evaluated in the same manner as director candidates identified by any other means. |
Corporate Governance Highlights
The Company upholds the highest standards of corporate governance including:
| •Substantial majority of independent director nominees (11 of 12)•Annual election of directors•Majority vote for directors•Lead Independent Director•Board oversight of risk management •Succession planning at all management levels, including for Board Members and Chair and Chief Executive Officer | •Annual Board and committee self-assessments •Executive sessions of non-management directors •Continuing director education•Meaningful executive and director stock ownership guidelines•Board oversight of enterprise-wide sustainability program and strategy |
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| 2024 Proxy Statement | 7 |
|---|
| ITEM | Advisory Approval of the Compensation of Our Named Executive Officers•Our Human Resources and Compensation Committee has adopted executive compensation programs with a strong link between pay and achievement of short and long-term Company goals.•Shareholders voted 91% in favor of the Company’s Advisory Approval of the Compensation of our Named Executive Officers (“NEOs”) at our 2023 Annual General Meeting. | The Board of Directors recommends a vote FOR this item. |
|---|---|---|
| See page 18 for further information |
Executive Compensation Highlights
The Human Resources and Compensation Committee (the “HRCC”) is guided by executive compensation principles that shape the executive compensation programs that the Committee adopts to execute on the Company’s strategies and goals.
Executive Compensation Principles
Our executive compensation programs are based on the following principles:
| (i) | business strategy alignment | (iii) | shareholder alignment | (v) | internal parity |
|---|---|---|---|---|---|
| (ii) | pay for performance | (iv) | mix of short and long-term incentives | (vi) | market competitiveness |
Executive Compensation Program Overview
The Committee has adopted executive compensation programs with a strong link between pay and performance and the achievement of short-term and long-term Company goals. The primary components of the executive compensation programs are base salary, Annual Incentive Matrix (“AIM”) and long-term incentives (“LTI”). The Committee places significant emphasis on variable compensation (AIM and LTI) so that a substantial percentage of the five Named Executive Officers’ (“NEOs”) target total direct compensation (“TDC”) is contingent on the successful achievement of the Company’s short-term and long-term performance goals.
Pay for Performance
A strong pay for performance culture is paramount to our success and encourages behavior that promotes long-term value creation for our shareholders. Accordingly, each executive’s TDC is strongly tied to Company, business and individual performance against set goals. Within our AIM Program, Company and business performance are measured against pre-established financial, operational and strategic objectives, and modified by an Environmental, Social and Governance (“ESG”) goal, which are all set by the Committee. Individual performance is measured against pre-established individual goals, inclusive of a personal sustainability commitment, as well as demonstrated leadership competencies and behaviors consistent with our leadership principles. Additionally, a portion of the executive’s LTI award is earned based on Company cash flow return on invested capital (“CROIC”) and total shareholder return (“TSR”) relative to companies in the Standard & Poor’s (“S&P”) 500 Industrials Index. In 2023, greater than 91% of our Chair and Chief Executive Officer’s TDC was performance-based and 76% of our other NEOs’ average TDC was performance-based compensation, which is dependent on our Company’s performance.
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2023 Executive Compensation
The table below shows the 2023 compensation for our Chief Executive Officer (“CEO”) and other NEOs, as required to be reported in the Summary Compensation Table pursuant to U.S. Securities and Exchange Commission (“SEC”) rules. Please see the notes accompanying the Summary Compensation Table on page 54 for further information.
Summary Compensation Table - 2023
| Name andPrincipal Position | Year | Salary($) | Bonus($) | StockAwards($) | OptionAwards ($) | Non-EquityIncentive PlanCompensation($) | Change inPensionValue andNonqualifiedDeferredCompensationEarnings($) | All OtherCompensation($) | Total($) |
|---|---|---|---|---|---|---|---|---|---|
| D. S. RegneryChair and ChiefExecutive Officer | 2023 | 1,362,500 | — | 9,487,257 | 2,875,006 | 4,059,149 | 4,487,670 | 584,762 | 22,856,344 |
| C. J. KuehnExecutive Vice Presidentand Chief Financial Officer | 2023 | 812,500 | — | 2,337,454 | 756,293 | 1,494,999 | 401,595 | 184,861 | 5,987,702 |
| P. A. CamutiExecutive Vice Presidentand Chief Technologyand Sustainability Officer | 2023 | 662,500 | — | 1,237,754 | 375,009 | 903,002 | 407,574 | 130,229 | 3,716,068 |
| E. M. TurtzSenior Vice Presidentand General Counsel | 2023 | 622,500 | — | 1,155,192 | 350,005 | 599,359 | 425,624 | 117,906 | 3,270,586 |
| R. D. PittardExecutive Vice President and Chief Integrated Supply Chain Officer | 2023 | 609,625 | — | 701,452 | 212,532 | 733,739 | 474,065 | 130,889 | 2,862,302 |
See the “Compensation Discussion and Analysis” section for more information about our Committee’s executive compensation principles, the programs the Committee has adopted and the decisions the Committee made regarding 2023 compensation.
| 2024 Proxy Statement | 9 |
|---|
| ITEM | Approval of Appointment of Independent Auditors•The Audit Committee engages in an annual evaluation of the qualifications, performance and independence of PricewaterhouseCoopers LLP (“PwC”).•Both by virtue of its familiarity with the Company’s affairs and its professional competencies and resources, PwC is considered best qualified to perform this important function.•The Audit Committee and the Board believe that the continued retention of PwC to serve as our independent auditor is in the best interests of the Company and its investors. | The Board of Directors recommends a vote FOR this item. |
|---|---|---|
| See page 18 for further information |
| ITEM | Renewal of the Directors’ Existing Authority to Issue Shares•The Board of Directors’ authority to issue shares under Irish law is fundamental to our business.•Granting the Board this authority is a routine matter for public companies incorporated in Ireland. | The Board of Directors recommends a vote FOR this item. |
|---|---|---|
| See page 20 for further information |
| ITEM | Renewal of the Directors’ Existing Authority to Issue Shares for Cash without First Offering Shares to Existing Shareholders•The Board of Directors’ authority to issue shares for cash without first offering shares to existing shareholders is fundamental to our business.•Granting the Board this authority is a routine matter for public companies incorporated in Ireland.•As required under Irish law, this proposal requires the affirmative vote of at least 75% of the votes cast. | The Board of Directors recommends a vote FOR this item. |
|---|---|---|
| See page 21 for further information |
| ITEM | Determine the Price at which the Company Can Reallot Shares Held as Treasury Shares•From time to time the Company may acquire ordinary shares and hold them as treasury shares.•The Company may reallot such treasury shares, and under Irish law, our shareholders must authorize the price range at which we may reallot shares held in treasury.•As required under Irish law, this proposal requires the affirmative vote of at least 75% of the votes cast. | The Board of Directors recommends a vote FOR this item. |
|---|---|---|
| See page 22 for further information |
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