J. M. Smucker Company (The)
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
 
 
SCHEDULE 14A
(RULE 14a-101)
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO.  )
 
 
Filed by the Registrant 
Filed by a Party other than the Registrant 
Check the appropriate box:
 
Preliminary Proxy Statement
 
Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))
 
Definitive Proxy Statement
 
Definitive Additional Materials
 
Soliciting Material Pursuant to §240.14a-12
THE J. M. SMUCKER COMPANY
(Name of Registrant as Specified In Its Charter)
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check all boxes that apply):
 
No fee required.
 
Fee paid previously with preliminary materials.
 
Fee computed on table in exhibit required by Item 25(b) per Exchange Act Rules 14a-6(i)(1) and 0-11.
 
 
 


LOGO


LOGO

June 28, 2024

Dear Fellow Shareholders,

As a shareholder in our Company, you are an important partner in our continued success. We are pleased to invite you to attend our Annual Meeting of Shareholders on Wednesday, August 14, 2024. The meeting will be held virtually at 11:00 a.m. Eastern Time.

I am proud that we continued to build on the strong, consistent track record our business has delivered in fiscal year 2024. These results also represent an important validating moment for our organization. They reflect the success of the diligent work we have done to transform our organization over the past few years. Notably, we have reshaped our portfolio to create greater focus and prioritization supporting our commitment to establish leading positions in attractive categories; we enhanced our capabilities, including reshaping our marketing and sales functions to improve how we build brands consumers love; and we introduced our Transformation Office to formalize a collaborative approach to identifying and activating opportunities for value creation, operational efficiency, and cost savings to reinvest in the business.

For the fiscal year, net sales were $8.2 billion. Additional highlights of our fiscal year 2024 performance include:

 

   

Full-year comparable net sales increased 8 percent, with volume/mix growth across all of our U.S. Retail segments and our International and Away From Home businesses;

 

   

Full-year adjusted earnings per share was $9.94*, reflecting a double-digit percentage increase versus the prior year;

 

   

On a full-year basis, free cash flow was $643 million*; and

 

   

Return of cash to shareholders through dividends was $438 million.

In addition to delivering another fiscal year of strong financial results, we also took a transformational step supporting the long-term growth of our business with the acquisition of Hostess Brands.

The acquisition of Hostess Brands provides the Company with leadership in the highly attractive snacking market. In addition to the opportunity to serve as steward for the Hostess Brands portfolio, we are excited about the highly complementary capabilities of our businesses. The acquisition also increases confidence in delivering on our long-term financial goals by advancing our scale, profitability, and cash flow.

We are focused on continuing to build Hostess Brands into a snacking powerhouse by accelerating advertising of the brands; continuing to leverage the proven innovation engine; expanding distribution, including through our Away From Home channel; ensuring diligent revenue growth management; and driving enhanced presence in e-commerce.

With the addition of our Sweet Baked Snacks business, we further strengthen our leading portfolio and create new opportunities to serve consumers, support our ability to realize our financial aspirations, and ultimately create long-term shareholder value.

Continuing to Live our Purpose

We are inspired by our Purpose – “feeding connections that help us thrive – life tastes better together” and guided by our Thriving Together agenda, which allows us to sharpen our focus on the issues impacting the quality of life for people and pets, specifically around the need for Quality Food, Education, Equitable and Ethical Treatment, Community Resources, and a Healthier Planet.

With this foundation, we define success by our ability to grow our business and the positive impact we have on all those who count on it. And, with this standard in mind, I am pleased to share that fiscal year 2024 was a success for our organization and our partners. Here are a few highlights from this past year:

 

   

We continued to support smallholder coffee farmers in key regions via partnerships with World Coffee Research, Hanns R. Neumann Stiftung (HRNS), TechnoServe, the U.S. Department of Agriculture (USDA), and Enveritas;

 

   

We expanded our partnership with Akron Children’s Hospital through its childhood literacy initiative with the launch of the Smucker’s Berry Good Reading Program;

 

   

As part of our corporate philanthropic commitments, we donated more than $1.5 million to key partners, including Feeding America, Greater Good – Rescue Bank, United Way, and American Red Cross, to address the needs of those in the communities where we live and work;

 

   

We celebrated our first-ever score of 100 on the Corporate Equality Index, a report published by the Human Rights Campaign which evaluates companies on equality and inclusion for LGBTQ+ employees; and

 

   

We stewarded resources and increased biodiversity through sustainable agriculture practices focused on soil health, conservation, reforestation, and pollinator health in partnership with National Fish and Wildlife Foundation, World Wildlife Fund, Reforest The Tropics and Pollinator Partnership, among others.


LOGO

In addition to these achievements, in reflection of our commitment to responsible business practices, we were recognized as one of the World’s Most Ethical Companies by Ethisphere and included in Newsweek’s listing of America’s Most Responsible Companies for the fifth year in a row.

Learn more about the progress we have made on these commitments by reviewing our public reporting including our 2023 Corporate Impact Report (inclusive of our disclosures based on the Sustainability Accounting Standards Board Food & Beverage standards and the recommendations set by the Task Force on Climate-related Financial Disclosures).

Recent Board Activity

During fiscal year 2024, we announced the election of Mercedes Abramo, Deputy Chief Commercial Officer for Cartier International SA, and Tarang Amin, Chairman and Chief Executive Officer of e.l.f. Beauty, Inc. to our Board of Directors. We are fortunate to have tremendous talent and diverse expertise across our Board to support the Company’s continued progress in executing our strategy. Mercedes and Tarang have been tremendous additions to our already strong Board, and I am excited to continue to work with all our directors to advance our organization in fiscal year 2025.

Fiscal Year 2025

To maintain progress on our strategy, it is important we continue to identify key priorities driving us forward. I have identified the following as our priorities for fiscal year 2025:

 

   

First, deliver the core business, which includes a focus on growing volume, operating with excellence, and continuing to prioritize resources to our fastest growth opportunities;

 

   

Next, integrate and deliver on the acquired Hostess business, including the integration of systems and processes, achieving cost synergies and growth ambitions, and nurturing a unified culture as we expand our organization;

 

   

And third, achieve our transformation, cost discipline, and cash generation aspirations.

With continued progress on our proven strategy, the sustained strength of our portfolio, and the continued ability of our employees to deliver with excellence, we are well positioned to realize success in fiscal year 2025 while continuing to support long-term shareholder value.

Thank you for your continued support of our Company.

Sincerely,

 

 

LOGO   

LOGO

 

                                       
  

 

Mark T. Smucker | Chair of the Board, President, and Chief Executive Officer

   

 

*

Please see Appendix A for a reconciliation of financial measures presented under generally accepted accounting principles in the United States (“GAAP”) to non-GAAP financial measures.

 

 

      

IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS FOR     

THE ANNUAL MEETING OF SHAREHOLDERS TO BE HELD ON AUGUST 14, 2024     

 

This Proxy Statement and the 2024 Annual Report are available at www.proxyvote.com     

       


LOGO

 

   

 

NOTICE OF

2024 ANNUAL MEETING OF SHAREHOLDERS

After careful consideration, the Board of Directors (the “Board”) of The J. M. Smucker Company (the “Company,” “we,” “us,” or “our”) has decided to hold the 2024 Annual Meeting of Shareholders (the “Annual Meeting of Shareholders” or the “Annual Meeting”) exclusively online, via a live audio-only webcast, in order to continue to provide expanded access, improved communication, and cost savings for shareholders.

 

 

 

   DATE AND TIME   

 

 

 

 Wednesday, August 14, 2024 | 11:00 a.m. Eastern Time

 

 

 

 

   LIVE WEBCAST   

 

 

 

 www.virtualshareholdermeeting.com/SJM2024

 

The Annual Meeting of Shareholders of the Company will be held for the following purposes:

 

 

 

1

 

 

 

 

To elect as directors the ten nominees named in the Proxy Statement and recommended by the Board whose term of office will expire in 2025;

 

 

 

 

2

 

 

 

 

To ratify the appointment of Ernst & Young LLP as the Company’s Independent Registered Public Accounting Firm (the “Independent Auditors”) for the 2025 fiscal year;

 

 

 

 

3

 

 

 

 

To approve, on a non-binding, advisory basis, the Company’s executive compensation as disclosed in these proxy materials; and

 

 

 

 

4

 

 

 

 

To consider and act upon any other matter that may properly come before the Annual Meeting.

 

 

Shareholders of record at the close of business on June 17, 2024, are entitled to vote at the Annual Meeting. All shareholders are invited to attend the virtual Annual Meeting.

 

 

LOGO

Jeannette Knudsen | Chief Legal Officer and Secretary

Voting Methods:

 

 

 

 

 VIA THE INTERNET

 

   

LOGO

   

 

 

  BY MAIL

 

      LOGO

 

 

 Visit www.proxyvote.com

   

 

 

  Complete, sign, date, and return

 and follow instructions

 

 

 

     

  the enclosed proxy card

 

 

 

  

 

 

 BY TELEPHONE

 

   

LOGO

   

 

 LIVE

 

 

     

LOGO

 

 

 Call toll-free (U.S. or Canada)

   

 

 

 By attending the virtual Annual Meeting

 1-800-690-6903

 

 

 

     

 and voting

 

 

 

  


TABLE OF CONTENTS

 

   

 

PROXY SUMMARY

     1  

PROXY STATEMENT

     9  

Corporate Governance

     9  

PROPOSAL 1 — ELECTION OF DIRECTORS

     19  

Board and Committee Meetings (includes
2024 Director Compensation Table)

     25  

Report of the Audit Committee

     35  

Service Fees Paid to the Independent
Registered Public Accounting Firm

     36  

Audit Committee Pre-Approval
Policies and Procedures

     36  

Independent Auditor Review
and Appointment Process

     37  

Benefits of a Long-Tenured Auditor

     37  

Communications with the
Audit Committee

     37  
PROPOSAL 2 — RATIFICATION OF
APPOINTMENT OF INDEPENDENT
REGISTERED PUBLIC ACCOUNTING FIRM
     38  
PROPOSAL 3 — ADVISORY VOTE ON
EXECUTIVE COMPENSATION (“SAY-ON-PAY”)
     39  

Executive Compensation (includes
Compensation Discussion and Analysis)

     40  

Compensation Committee Report

     64  

Compensation Committee Interlocks
and Insider Participation

     64  

Compensation Tables

     65  

Summary Compensation Table

     65  

2024 Grants of Plan-Based Awards

     67  

Outstanding Equity Awards
at 2024 Fiscal Year End

     68  

2024 Option Exercises and Stock Vested

     69  

2024 Pension Benefits

     71  

2024 Nonqualified
Deferred Compensation

     72  

Potential Payments to Executive Officers
Upon Termination or Change in Control

     73  

2024 CEO Pay Ratio

     77  

Pay Versus Performance

     78  

Related Party Transactions

     82  

Ownership of Common Shares

     83  

Equity Compensation Plan Information

     85  

Annual Report

     86  

2025 Shareholder Proposals

     86  

Other Matters

     86  

“Householding” of Proxy Materials

     87  

Electronic Delivery of Company
Shareholder Communications

     88  

Proxy Solicitation and Costs

     88  

Questions and Answers About
the Annual Meeting and Voting

     88  
APPENDIX A: RECONCILIATION
OF ADJUSTED OPERATING INCOME,
ADJUSTED EARNINGS PER SHARE,
AND FREE CASH FLOW TO THE
RELATED GAAP MEASURES
     A-1  
 


 

PROXY SUMMARY

 

 

 

This summary highlights information 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.

2024 Annual Meeting of Shareholders

 

 

  DATE AND TIME  

  

   Wednesday, August 14, 2024 | 11:00 a.m. Eastern Time

 

  LIVE WEBCAST  

  

 

www.virtualshareholdermeeting.com/SJM2024

 

  

 WHO CAN VOTE 

  

Shareholders of record

at the close of business

on June 17, 2024

are entitled to vote at the

virtual Annual Meeting.

 

 

 

Voting Recommendations of the Board

 

 

Proposal    Proposal Summary    Voting Recommendation      Page

 

 

LOGO

   Election of the Board nominees named in this Proxy Statement with terms expiring at the 2025 Annual Meeting of Shareholders    LOGO        19

 

 

LOGO

   Ratification of appointment of Ernst & Young LLP as the Company’s Independent Registered Public Accounting Firm for the 2025 fiscal year    LOGO        38

 

 

LOGO

   Advisory approval of the Company’s executive compensation    LOGO        39

Fiscal Year 2024 Performance Highlights

 

 

LOGO

 

*

For a reconciliation of adjusted earnings per share and free cash flow, see Appendix A. For a description of how we calculate adjusted earnings per share and free cash flow, see Management’s Discussion and Analysis of Financial Condition and Results of Operations in our 2024 Annual Report on Form 10-K, which can be found on our website at investors.jmsmucker.com. Our fiscal year 2024 performance was one of the key factors in the compensation decisions for the fiscal year, as more specifically discussed in the Compensation Discussion and Analysis section of this Proxy Statement.

 

 

The J. M. Smucker Company       LOGO       2024 Proxy Statement      1  


PROXY SUMMARY     

 

Director Nominees

The following table provides summary information about each of our director nominees.

 

       

 

Director

Since

 

 

 

Professional

Background

 

 

 

Board Committees

 

 

 

Other Public

Company Boards

 

 Name

 

 

Age

 

 

 

AC*

 

 

 

CPC

 

 

 

NGCR

 

 

Mercedes Abramo

 

LOGO

 

 

54

 

 

2023

 

 

Deputy Chief Commercial Officer

Cartier International SA

 

 

LOGO

           

Tarang Amin

 

LOGO

  59   2023  

Chairman and Chief Executive Officer

e.l.f. Beauty, Inc.

 

      LOGO      

•  e.l.f. Beauty, Inc.

Susan

Chapman-Hughes

 

LOGO

  55   2020  

Former Executive Vice President and General Manager, Global Head of Digital Capabilities, Transformation, and Operations, Global Commercial Services

American Express Company

 

    LOGO    

•  Toast, Inc.

Jay Henderson

 

LOGO

  68   2016  

Retired Vice Chairman, Client Service

PricewaterhouseCoopers LLP

 

  LOGO

 

LOGO

 

     

•  Illinois Tool Works Inc.

•  Northern Trust Corporation

Jonathan Johnson III

 

LOGO

  58   2022  

Former Chief Executive Officer

Overstock.com, Inc. (now known as Beyond, Inc.)

 

    LOGO      

Kirk Perry

 

LOGO

  57   2017  

President and Chief Executive Officer

Circana, Inc.

 

      LOGO    

Alex Shumate

 

LOGO   LOGO

  74   2009  

Senior Partner and Ohio Strategic Relationship Partner

Squire Patton Boggs (US) LLP

 

      LOGO    
Mark Smucker   54   2009  

Chair of the Board, President, and

Chief Executive Officer

The J. M. Smucker Company

 

       

•  Kimberly-Clark Corporation

Jodi Taylor

 

LOGO

  61   2020  

Retired Chief Financial and Administrative Officer

The Container Store Group, Inc.

 

 

LOGO

 

LOGO

       

•  Mister Car Wash, Inc.

Dawn Willoughby

 

LOGO

  55   2017  

Former Executive Vice President and Chief Operating Officer

The Clorox Company

 

      LOGO  

•  International Flavors and Fragrances, Inc.

•  TE Connectivity Ltd.

* Audit Committee   Compensation and People Committee   Nominating, Governance, and Corporate Responsibility Committee

LOGO Chair  LOGO Financial Expert   LOGO Independent Director   LOGO Lead Independent Director   LOGO Member

 

 

 

2    The J. M. Smucker Company       LOGO       2024 Proxy Statement


     PROXY SUMMARY

 

ESG AND CORPORATE RESPONSIBILITY

 

LOGO  

We believe success is driving business growth while helping those associated with our Company thrive. And, for more than 125 years, we have done just that. Our philosophy of corporate responsibility builds on the wisdom of our founder, Jerome Monroe Smucker, a deeply principled and forward-thinking man. For our Company, being responsible means doing the right thing for our consumers, customers, employees, suppliers, communities, and shareholders. Our commitment to being a good corporate citizen allows us to positively impact the lives of our employees and business partners, as well as the communities and planet we all share.

We are inspired by our Purpose, Feeding Connections That Help Us Thrive – Life Tastes Better Together. And we deliver on that Purpose through the guidance of our Thriving Together agenda, which is focused on:

 

  LOGO

Ensuring Access to Quality Food

 

  LOGO

Supporting Access to Education

 

  LOGO

Making Connections to Community Resources

 

  LOGO

Promoting Equitable and Ethical Treatment for All

 

  LOGO

Supporting a Healthier Planet

Through this focused approach, we maximize our resources to make the most meaningful impact in the areas we are best equipped to support.

ESG Reporting

This year, we will issue our fourteenth public report on the progress we are making on our environmental, social, and governance (“ESG”) commitments through our Corporate Impact Report. As part of this report, we will share an overview of our ESG initiatives and metrics, using the Sustainability Accounting Standards Board (SASB) Food & Beverage – Processed Foods and Non-Alcoholic Beverages industry standards, as well as how our efforts support select United Nations Sustainable Development Goals. Additionally, the Corporate Impact Report will detail how we evaluate and manage climate-related risks and opportunities in alignment with the recommendations set by the Task Force on Climate-Related Financial Disclosures (TCFD). Lastly, in fiscal year 2024, we issued our latest Employer Information Report EEO-1.

ESG Oversight

Our ESG journey has evolved over time to become more comprehensive across our business. Our Vice President, ESG, Deputy General Counsel, and Assistant Secretary (“Vice President of ESG”) has the highest level of direct responsibility for ESG matters within the Company and is the executive sponsor of our Sustainability Steering Committee, which was established in 2006. The committee, which is chaired by our Director of Sustainability and is comprised of key leaders from various functional areas, leads our sustainability goalsetting efforts and monitoring of activities. Our Chief Legal Officer and Secretary (“Chief Legal Officer”) has the highest level of direct responsibility for governance, ethics, compliance, and enterprise risk management within the Company, and our Chief Financial Officer provides additional leadership and guidance for enterprise risk management.

We have continued to build and improve on our ESG efforts by expanding our ESG Governance Council, comprised of key leaders from various functional areas, which, together with certain members of our executive leadership team, is responsible for our evolving ESG strategy and efforts. Our Chief Legal Officer and our Vice President of ESG, along with members of their teams who are on the ESG Governance Council, report on such activities to our executive leadership team, the Board, and the committees of the Board, which in turn provide further direction on the prioritization of activities and resources. The Nominating, Governance, and Corporate Responsibility Committee (the “Nominating Committee”) assists the full Board and oversees our ESG program. In addition, and as noted below, the Compensation Committee holds our Chief Executive Officer responsible for achieving our ESG objectives and, beginning in fiscal year 2023, all of our employees at or above the Senior Director level, including all of our executive officers, had 10% of their short-term incentive compensation based on the achievement of ESG objectives.

 

 

 

The J. M. Smucker Company       LOGO       2024 Proxy Statement      3  

 


PROXY SUMMARY

 

ESG Areas of Focus

Our ESG areas of focus include (i) environmental impact, (ii) employee impact, (iii) community impact, (iv) consumer impact, (v) supply chain impact, and (vi) governance and ethics.

 

LOGO

 

LOGO  

Environmental Impact

 

We are committed to improving the environmental footprint of our operations through a dedication to delivering a more sustainable approach to our operations and value chain focusing on climate action, natural resource stewardship, and responsible sourcing and packaging. We have:

 

LOGO    Continued to work toward our environmental impact benchmarks, including our greenhouse gas emissions goals developed using the Science-Based Targets Initiative protocol;

 

LOGO    Maintained our commitment to conservation practices in partnership with the World Wildlife Fund, National Fish and Wildlife Foundation, Reforest the Tropics, and Pollinator Partnership; and

 

LOGO    Continued to evaluate and implement more efficient production processes across our manufacturing footprint to support our environmental impact goals.

LOGO  

Employee Impact

 

We take proactive steps to ensure we meet our employees’ physical, emotional, and financial needs. Notably, we:

 

LOGO    Conduct an employee engagement survey annually to provide an opportunity for open and confidential feedback from employees and to identify opportunities for improvement;

 

LOGO    Foster an environment of growth for our people and we support and challenge our employees to increase their knowledge, skills, and capabilities through all phases of their career;

 

LOGO    Provide market competitive pay and benefit programs which promote and foster the overall well-being of our employees, including introducing new benefits to help meet the evolving needs of our employees and their families;

 

LOGO    Ensure workforce health and safety through education and training, which is provided at all locations. These efforts resulted in our Company achieving a total recordable incident rate during fiscal year 2024 that was four times below the national average; and

 

LOGO    Promote an inclusive culture and diverse workforce while leveraging our voice and position to promote societal equity. In fiscal year 2024, we introduced a new dedicated training program for people managers, “Leading Inclusively.” The training program, which is an extension of our core people manager development program, “Discovering the Art of Leadership,” is focused on fostering an inclusive workforce that embraces and reflects the diverse populations of the consumers we serve and the communities where we live and work.

 

 

 

4    The J. M. Smucker Company       LOGO       2024 Proxy Statement

 


     PROXY SUMMARY

 

LOGO  

Community Impact

 

We are passionate about supporting the communities where we live and work. Through our many partnerships, we understand the needs and support required in our local communities and leverage these relationships to make the necessary connections to offer critical assistance to those in need. Notably, we:

 

LOGO    Collaborate with our partners, including Feeding America and Rescue Bank, to help feed people and pets in need;

 

LOGO    Support community organizations, including the Red Cross and United Way, which provide critical disaster relief;

 

LOGO    Promote education and development through our work with several partners, including the LeBron James Family Foundation and its I PROMISE School, notably supplying the school’s on-site food pantry, donating to the school’s library, and sponsoring the Smucker Hometown Hall, a community gathering space as part of the newly opened House 330 in Akron, Ohio; and

 

LOGO    Empower employee volunteerism and financial donations, including offering our Company matching gift program.

LOGO  

Consumer Impact

 

We make consumers’ lives better by delivering food people and pets love. We recognize the opportunity to serve consumers is earned, and we are committed to maintaining that trust with every product we produce. We realized this by:

 

LOGO    Producing safe, quality food through our experienced Quality Assurance team in partnership with our Operations, Supply Chain, Procurement, and Contract Manufacturing teams;

 

LOGO    Maintaining a commitment to responsible marketing practices, including substantiating claims and not leveraging any media channel primarily targeting children 13 and under; and

 

LOGO    Helping ensure consumers have an understanding of the ingredients in our products through our labeling and brand web sites.

LOGO  

Supply Chain Impact

 

We are committed to ensuring the sustainability of our supply chain while supporting those connected to it by strategically investing in our suppliers’ ability to continuously deliver the quality ingredients used in our products. This supports livelihoods for our suppliers and their families, while ensuring we meet our expectation of ethical and responsible sourcing. This is realized by:

 

LOGO    Communicating our expectations with regard to labor practices and human rights, business integrity, responsible environmental practices, and reporting and enforcement standards through our Global Supplier Code of Conduct;

 

LOGO    Reinforcing our Animal Welfare Policy to reflect our commitment to not conduct or sponsor any harmful animal testing, our expectations for the humane treatment of animals in our supply chain, and our efforts to improve the lives of, and relationships with, our pets in the United States and Canada;

 

LOGO    Steadily expanding our Global Responsible Sourcing Program to drive positive impact across our supply chain through enhanced collaboration, including streamlining processes and engaging internal and external stakeholders; and

 

LOGO    Reinforcing our commitment to transparency by introducing our Integrity Portal, an enhanced tool for employees and suppliers to anonymously report any concerns that may impact our commitments.

 

 

 

The J. M. Smucker Company       LOGO       2024 Proxy Statement      5  

 


PROXY SUMMARY

 

 

 

Governance and Ethics

We place a strong focus on our governance practices and continually evaluate them, taking into consideration evolving expectations and the perspectives of our shareholders. Our Board operates with transparency and integrity as it oversees corporate governance practices that align with the interests of our shareholders.

Board Makeup

We consider the skills and expertise of our directors, along with our Board makeup, to ensure we have the right individuals to fulfill the Board’s responsibilities of strategic oversight, succession planning, compliance oversight, ESG oversight, cybersecurity oversight, and risk management. We regularly consider new director candidates, and we utilize the assistance of an external search firm to identify new potential candidates. In developing our director criteria, we considered feedback from our Board and management, input from key external advisors, and interviews with our investors. We believe that it is important to maintain the continuity of our Board by retaining long-tenured directors, while also adding new directors who provide new insights and bring different expertise and experiences to the Board. Since 2020, we have nominated five new directors who have contributed strong expertise and insights in the areas of strategy, marketing, sales, finance, supply chain, digital technology, e-commerce, people management, operations, innovation, risk management, and ESG matters.

In fiscal year 2023, Mark Smucker assumed the role of Chair of the Board, succeeding Richard Smucker, who served as Executive Chairman since 2016. This continuity of leadership, combined with the Board members’ deep knowledge of our Company and its strategic vision, product categories, innovation platforms, risks, and opportunities, positions the Board to continue to oversee our strategy and continue our long history of generating attractive returns for our shareholders.

We will continue to consider the appropriate timing for director rotations to ensure we have the appropriate mix of skills based on our strategic goals and challenges and to ensure we maintain a diverse Board, because a strong, diverse Board provides differing perspectives that yield better decisions.

To facilitate our director succession planning, in August 2022, we rotated and appointed new Committee members and chairs for the Audit Committee, Compensation Committee, and Nominating Committee (collectively, the “Committees”). During fiscal year 2025, each independent director will sit on only one Committee. We are focused on orienting new Committee members appropriately for their roles, and we will continue to provide ongoing education sessions for all our directors.

 

LOGO

Following the annual meeting:

 

 

 BOARD SIZE 

 

10

 

directors

 

Since 2023

 

 

 BOARD REFRESHMENT 

 

5 new

 

directors

 

Since 2020

 

 

 BOARD DIVERSITY 

 

of 10

 

are women

 

of 10

 

are racially or ethnically diverse

 

 

 BOARD INDEPENDENCE 

 

9 of 10

 

are independent

 

 

 

 

 

6    The J. M. Smucker Company       LOGO       2024 Proxy Statement

 


     PROXY SUMMARY

 

Finally, we consider the ratio between independent and non-independent directors and will have nine independent directors and one non-independent director if our current director nominees are elected. Since 2015, we have reduced the number of non-independent directors from five members to one member. The non-independent director is a Smucker family member, and we will also have two Smucker family members serving as non-voting Chairman Emeriti during fiscal year 2025. We believe that including Smucker family members strengthens our Board because of their deep knowledge of the Company, their commitment to the Company and our Basic Beliefs of Be Bold, Be Kind, Do the Right Thing, Play to Win, and Thrive Together (our “Basic Beliefs”), their passion for ensuring continued growth for the Company bearing their name, and their vested interest.

Risk Management

Our Company has always understood the importance of having strong compliance and enterprise risk management practices to protect our business and employees. In fact, Doing the Right Thing is one of our Basic Beliefs and is core to our culture. Over the past several years, we have taken a more formal approach to managing these two important areas and have expanded the compliance and enterprise risk functions to bring additional focus and visibility to our management and the Board. Our Vice President, Chief Ethics and Compliance Officer (“Chief Compliance Officer”) oversees this function. This independent function reports to the Chief Legal Officer and reports quarterly to our Board and the Audit Committee. We believe that our Chief Compliance Officer has the appropriate expertise and visibility within the organization to best develop and execute these programs, and she has developed strong relationships and trust with, as well as direct, independent access to, our Board and Audit Committee. Our Governance, Risk, and Compliance Committee, which is comprised of senior leaders from our officer leadership team, has completed its annual assessment of our enterprise risks, led by our enterprise risk team with input from leadership and numerous cross-functional teams. Leaders within our organization have been assigned responsibility for each key risk identified, and we have developed a system for monitoring and reporting these risks to the Board and its Committees. Each Committee is assigned responsibility for specific risks, which we have outlined in our Committee charters and which are further described in this Proxy Statement.

 

 

   

   

 

OUR KEY GOVERNANCE PRACTICES

 

      
   

 

LOGO    Adopted proxy access

 

LOGO    No poison pill

 

LOGO    Annual election of all directors

 

LOGO    Majority voting standard for all directors

 

LOGO    No cumulative voting for election of directors

 

LOGO    One share, one vote

 

LOGO    Strong Board diversity and refreshment

 

LOGO    Regular rotation of Committee chairs and members

 

 

LOGO    Appointment of Lead Independent Director

 

LOGO    Annual Board and Committee self-assessment evaluations

 

LOGO    Executive sessions of independent directors are scheduled at the end of each regular Board and Committee meeting

 

LOGO    Directors have complete access to management

 

LOGO    Strategic, business, financial, and legal reviews provided at every Board meeting and enterprise risks, compliance, people, and cybersecurity reviewed regularly

 

 

LOGO    Annual advisory vote on executive compensation

 

LOGO    Independent compensation consultant

 

LOGO    Annual peer group compensation market assessment

 

LOGO    Annual compensation risk assessment

 

LOGO    Clawback policy

 

LOGO    Director and executive officer stock ownership guidelines

 

LOGO    No hedging and no pledging stock policies

  

 

 

To learn more, we invite you to read about our ESG efforts on our website at www.jmsmucker.com

 

 

The J. M. Smucker Company       LOGO       2024 Proxy Statement      7  

 


PROXY SUMMARY

 

 

 

Our People and Culture

We believe our employees are our most important asset. Our founder, Jerome Monroe Smucker, established a culture that puts people at the core of everything we do. Preserving the essence of that culture and ensuring the well-being of our employees remains a critical business priority and responsibility of the Board. This commitment continues to be guided by our Basic Beliefs and Our Commitment to Each Other, which provide guidance on how to bring these important values to life each day. By achieving this, we retain the unique culture that differentiates our Company and enables all employees to reach their full potential. The Board’s role includes ensuring that we continue to implement these beliefs, which support the growth, safety, and well-being of our employees and are essential to driving a successful and sustainable business.

We Value Your Feedback

As we head further into fiscal year 2025, one of the Board’s key areas of focus is an increased level of direct engagement with our shareholders. We understand that an ongoing and open line of communication on all matters is critical to your investment in the Company, including our operational and financial strategy, compliance, risk management, and ESG programs. We encourage you to share your views with us.

If you would like to write to us, you may do so by addressing your correspondence to:

 

 

Corporate Secretary

The J. M. Smucker Company

One Strawberry Lane

Orrville, Ohio 44667

 

    

 

You can also call our

Shareholder Services

number at 1-330-684-3838

LOGO

 

 

8    The J. M. Smucker Company       LOGO       2024 Proxy Statement


 

PROXY STATEMENT

FOR THE ANNUAL MEETING OF SHAREHOLDERS

TO BE HELD ON AUGUST 14, 2024

 

 

CORPORATE GOVERNANCE

Corporate Governance Guidelines

Our Corporate Governance Guidelines (the “Guidelines”) are designed to formalize the Board’s role and to confirm its independence from management and its role of aligning management and Board interests with the interests of shareholders. The Guidelines provide in pertinent part that:

 

  LOGO

A majority of directors will be independent as required by the rules of the New York Stock Exchange (the “NYSE”) and the Securities and Exchange Commission (the “SEC”), and as further set forth in the Guidelines;

 

 

  LOGO

All members of the Committees will be independent, and there will be at least three members on each of the Committees;

 

 

  LOGO

All members of the Committees and the chairs of the Committees will be appointed by the Board on the recommendation of the Nominating Committee, and the Board intends to rotate the chairs of the Committees every five years;

 

 

  LOGO

The independent directors will meet in executive session on a regular basis in conjunction with regularly scheduled meetings of the Board and the Committees, and such meetings will be chaired by a lead independent director (in such role, the “Lead Independent Director”), who will be selected by the independent directors with input from the Chair of the Board;

 

 

  LOGO

The Lead Independent Director will coordinate the activities of the other independent directors and perform such other duties and responsibilities as the Board may determine, including those set forth below under the heading “Executive Sessions and Lead Independent Director;”

 

 

  LOGO

The Board and each of the Committees will conduct an annual self-evaluation;

 

 

  LOGO

All non-employee directors will own a minimum amount of the Company’s common shares as established in our Stock Ownership Guidelines for Directors and Officers, which currently require that non-employee directors own common shares with a value of no less than five times the annual cash retainer paid to each non-employee director and that each non-employee director should strive to attain this ownership threshold within five years of joining the Board;

 

 

  LOGO

Each director will attend at least 75% of all regular and special meetings of the Board;

 

 

  LOGO

Absent specific action by the Board, directors will not be eligible for nomination after reaching 75 years of age;

 

 

  LOGO

Each director will advise the Chair of the Board and the Lead Independent Director in advance of accepting an invitation to serve on the board of another public company to allow for a review of any potential conflicts or other concerns;

 

 

  LOGO

Each director will advise the Nominating Committee, and offer to resign, if his or her primary professional position or responsibility materially changes to provide the Board an opportunity to review the qualifications of the director;

 

 

  LOGO

No director will serve concurrently on more than three public company boards, including that of the Company, without prior, unanimous consent of the Board;

 

 

  LOGO

The Nominating Committee and the Board will consider a director’s length of tenure when reviewing Board composition and will seek to maintain an overall balance of experience and continuity, along with fresh perspectives. The Board does not have a director tenure limit but will consider the impact of a director’s tenure after he or she has served on the Board for more than 15 years; and

 

 

 

 

 

 

   

 

The J. M. Smucker Company       LOGO       2024 Proxy Statement      9  


CORPORATE GOVERNANCE

 

  LOGO

The Corporate Secretary will provide newly elected directors with materials and training in our director orientation program and will also provide such additional director training and orientation as appropriate and in accordance with our Board Education Policy.

 

Shareholder Recommendations for Director Nominees

The Nominating Committee is responsible for identifying, evaluating, and recommending qualified candidates to the Board for nomination. The Nominating Committee considers all suggestions for membership on the Board, including nominations made by our shareholders, and all candidates are evaluated consistent with our policy of nondiscrimination. Shareholders’ nominations for directors must be made in writing and include the nominee’s written consent to the nomination and detailed background information sufficient for the Nominating Committee to evaluate the nominee’s qualifications. Nominations should be submitted to the Corporate Secretary, The J. M. Smucker Company, One Strawberry Lane, Orrville, Ohio 44667. The Corporate Secretary will then forward nominations to the Chair of the Nominating Committee. All recommendations must include qualifications that meet, at a minimum, the following criteria:

 

  LOGO

Director candidates must be committed to our culture and Basic Beliefs and will be individuals of integrity, intelligence, and strength of character having a balance of skills, knowledge, diversity, background, and experience beneficial to the Company;

 

 

  LOGO

Independent director candidates must meet the independence requirements set forth below under the heading “Director Independence;”

 

 

  LOGO

Independent director candidates must also maintain independence necessary for an unbiased evaluation of management performance;

 

 

  LOGO

Director candidates must be able to effectively carry out responsibilities of oversight of our strategy, compliance, and risks;

 

 

  LOGO

Director candidates should have either significant experience in a senior executive role with a major business organization or relevant experience from other professional backgrounds;

 

 

  LOGO

Director candidates should have a working knowledge of ESG issues, risk oversight, and the changing role of boards;

 

 

  LOGO

Director candidates should have a firm commitment to attend and participate in Board meetings and related Board activities;

 

 

  LOGO

Director candidates should not have any affiliations or relationships with competitive businesses or organizations or other activities, in each case which could lead to a real or perceived conflict of interest; and

 

 

  LOGO

Director candidates should not serve on more than three public company boards, including that of the Company, at any one time without prior, unanimous consent of the Board.

 

Shareholder-Nominated Director Candidates

The Company’s Amended Regulations (the “Regulations”) provide a proxy access right to permit any shareholder or a group of up to 20 shareholders owning at least 3% of the Company’s outstanding common shares continuously for at least three years to nominate, and include in our Proxy Statement, director nominees constituting up to the greater of (i) two directors or (ii) 20% of the Board, subject to certain limitations and provided that shareholders and nominees satisfy the requirements specified in the Regulations. Requests to include shareholder-nominated candidates for director in our Proxy Statement and form of proxy related to our 2025 Annual Meeting of Shareholders must be submitted to and received by the Corporate Secretary, The J. M. Smucker Company, One Strawberry Lane, Orrville, Ohio 44667, no earlier than January 29, 2025 and no later than February 28, 2025.

 

 

10    The J. M. Smucker Company       LOGO       2024 Proxy Statement

 

   

 

 

 


CORPORATE GOVERNANCE

 

Board Diversity

We greatly value diversity and the varying perspectives and experiences that emerge from a diverse group of people, and the Board and the Nominating Committee believe the value of diversity extends to the boardroom and that diversity strengthens the composition of the Board. Therefore, the Board and the Nominating Committee seek to consider a diverse group of experiences, characteristics, attributes, skills, and cultural and other backgrounds in considering potential director candidates. To further this goal, the Nominating Committee recently amended its Charter to specify that the Nominating Committee is committed to seeking out qualified diverse candidates who meet the applicable search criteria, including women and minority candidates, to include in the pools from which nominees for the Board are considered, invited for interviews, and ultimately offered the opportunity to be appointed to the Board or stand for election to the Board. In the event a third-party search firm is engaged for a particular director search, the Nominating Committee would expect, and would plan to instruct, such firm to include individuals reflecting the aforementioned criteria in the initial pool or lists of potential director candidates submitted to the Nominating Committee for consideration. Diversity is important because a variety of viewpoints contribute to a more effective decision-making process.

The Nominating Committee and the Board also consider the composition of the Board as a whole in evaluating whether a particular individual should serve on the Board, as the Board seeks to comprise itself of members who, collectively, possess a range of relevant skills, experience, and expertise. The below graphs summarize the tenure, age, gender, and racial or ethnic diversity breakdown of our director nominees:

 

LOGO        

 

 

LOGO

 

 

 

 

 

   

 

The J. M. Smucker Company       LOGO       2024 Proxy Statement      11  


CORPORATE GOVERNANCE

 

Experience, Qualifications, Attributes, Skills, and Diversity of Director Nominees

As mentioned above, in considering each director nominee and the composition of the Board as a whole, the Nominating Committee looks for a diverse group of experiences, characteristics, attributes, and skills that relate directly to our management and operations. Success in specific categories is a key factor in our overall operational success and creating shareholder value. The Nominating Committee believes that directors who possess some or all of the following experiences, characteristics, attributes, and skills are better able to provide oversight of our management and long-term and strategic objectives.

 

     

 

Adherence to the

Company’s Basic Beliefs

 

 

 

We seek directors who understand, and are committed to, our Basic Beliefs. These Basic Beliefs are our values and principles that serve as guideposts for decisions at every level of the Company and cultivate a culture of commitment to each other and to our constituents.

 

 

Leadership Experience

 

 

We seek directors who have significant leadership experience, either in a senior executive role with a major business organization or relevant experience from other professional backgrounds. Strong leaders bring vision, strategic agility, diverse and global perspectives, and broad business insight to the Company. They also demonstrate a practical understanding of organizations, processes, strategy, risk management, compliance, and the methods to drive change and growth. People with experience in significant leadership positions possess strong abilities to motivate and manage others and to identify and develop leadership qualities in others.

 

 

Independence

 

 

We require that a majority of our directors satisfy the independence requirements of the NYSE and the SEC.

 

 

Finance Experience

 

 

 

We believe that it is important for Directors to have an understanding of finance and financial reporting processes. Accurate financial reporting is critical to our success and reputation. We seek to have at least two independent Directors who qualify as “audit committee financial experts,” within the meaning of Regulation S-K promulgated by the SEC (“Regulation S-K”), particularly for service on the Audit Committee. We expect all of our directors to be financially knowledgeable.

 

 

Public Company

Board Experience

 

 

We seek directors who have experience serving on the boards of other large, publicly traded companies. This experience prepares the directors to fulfil the Board’s responsibilities of overseeing our business and providing insight and guidance to management.

 

 

Environmental, Social,

and Governance

Experience

 

 

 

We seek directors who have knowledge of and experience with ESG initiatives to help inform us on best practices and assist us in establishing goals and delivering against those goals.

 

 

Operations Experience

in Consumer Goods

 

 

 

We seek directors with relevant general management or operations experience in the consumer goods industry. We believe that it is important for directors to have experience in new and expanding businesses, customer segments, and geographies.

 

 

People Management

Experience

 

 

 

We seek directors with relevant people management experience, including matters such as inclusion, diversity, and equity, workplace environment, and talent development and retention.

 

 

Diversity

 

 

 

We greatly value diversity and the varying perspectives and experiences that emerge from a diverse group of people. Because of this, we believe diversity in our Board is important, including diversity of experiences, characteristics, attributes, skills, and cultural and other backgrounds.

 

 

Marketing, Digital,

Innovation, or Public

Relations Experience

 

 

 

As a manufacturer and marketer of branded food products, we seek directors who have a diverse range of marketing, digital, innovation, or public relations experience.

 

 

Mergers and Acquisitions

Experience

 

 

 

We have been, and believe we will continue to be, active in acquiring other companies that fit our strategy and, therefore, seek directors with relevant mergers and acquisitions experience, including experience in integrating businesses.

 

 

 

12    The J. M. Smucker Company       LOGO       2024 Proxy Statement

 

   

 

 

 


CORPORATE GOVERNANCE

 

The Board believes that all of the directors are highly qualified and have specific employment and leadership experiences, qualifications, and skills that qualify them for service on the Board. The specific experiences, qualifications, and skills that the Board considered in determining that each such person should serve as a director are included in their individual biographies and also summarized further in the following table:

 

Director Qualifications and Experience

LOGO

 

   LOGO   

 

LOGO

 

   LOGO   

 

LOGO

 

   LOGO   

 

LOGO

 

   LOGO   

 

LOGO

 

   LOGO   

 

   
Knowledge, Skills, and Experience

 

 

 

 

 

 

 

 

 

 

                     

Adherence to the Company’s Basic Beliefs

                     

Leadership Experience

                     

Independence

 

                     

Finance Experience

                     

Public Company Board Experience

 

                     

Environmental, Social, and Governance Experience

                     

Operations Experience in Consumer Goods

 

 

 

                     

People Management Experience

                     

Diversity

 

 

 

 

                     

Marketing, Digital, Innovation, or Public Relations Experience

                     

Mergers and Acquisition Experience

 

   
Demographics

 

 

 

 

 

 

 

 

 

 

   
Race/Ethnicity

 

 

 

 

 

 

 

 

 

 

                     

Black or African American

 

 

 

 

 

 

 

 

                     

American Indian or Alaska Native

 

 

 

 

 

 

 

 

 

 

                     

Asian

 

 

 

 

 

 

 

 

 

                     

White

 

 

 

                     

Middle Eastern or North African

 

 

 

 

 

 

 

 

 

 

                     

Native Hawaiian or Other Pacific Islander

 

 

 

 

 

 

 

 

 

 

                     

Hispanic or Latino

 

 

 

 

 

 

 

 

 

 

   
Gender

 

 

 

 

 

 

 

 

 

 

                     

Male

 

 

 

 

                     

Female

 

 

 

 

 

 

 

 

 

 

 

   

 

The J. M. Smucker Company       LOGO       2024 Proxy Statement      13  


CORPORATE GOVERNANCE

 

Director Resignation Policy

In connection with the adoption of a majority voting standard for uncontested elections of directors, the Board adopted a director resignation policy to address the situation in which one or more incumbent directors fail to receive the required majority vote for re-election in an uncontested election. Under Ohio law, an incumbent director who is not re-elected would remain in office as a “holdover” director until his or her successor is elected. This director resignation policy provides that an incumbent director who is not re-elected with more “for” votes than “against” votes in an uncontested election will be expected to tender to the Board his or her resignation as a director promptly following the certification of the election results. The Nominating Committee would then consider each tendered resignation and recommend to the Board whether to accept or reject each such tendered resignation. The Board would act on each tendered resignation, taking into account its fiduciary duties to the Company and our shareholders and the Nominating Committee’s recommendation, within 90 days following the certification of the election results. The Nominating Committee, in making its recommendation, and the Board, in making its decision, may consider any factors or other information with respect to any tendered resignation that they consider appropriate, including, without limitation:

 

  LOGO

The stated reason for such director’s failure to receive the approval of a majority of votes cast;

 

 

  LOGO

The percentage of votes cast against such director; and

 

 

  LOGO

The performance of such director.

 

Following the Nominating Committee’s recommendation and the Board’s decision, the Board will promptly and publicly disclose its decision whether to accept or reject each tendered resignation and, if applicable, the reasons for rejecting a tendered resignation. If a director’s tendered resignation is rejected, he or she would continue to serve until his or her successor is elected, or until his or her earlier resignation, removal from office, or death. If a director’s tendered resignation is accepted, then the Board would have the sole discretion to fill any resulting vacancy or decrease the number of directors, in each case pursuant to the provisions of and to the extent permitted by the Regulations. Any director who tenders his or her resignation pursuant to this policy would abstain from providing input or voting on the Nominating Committee’s recommendation or the Board’s action regarding whether to accept or reject the tendered resignation. While this description reflects the terms of the Board’s current director resignation policy, the Board retains the power to amend and administer the policy as the Board, in its sole discretion, determines is appropriate.

Director Independence

We require that a majority of our directors be “independent” as defined by the rules of the NYSE and the SEC. We may, in the future, amend the Guidelines to establish such additional criteria as the Board determines to be appropriate. The Board makes a determination as to the independence of each director on an annual basis. The Board has determined that the following nine non-employee directors are independent directors: Mercedes Abramo, Tarang Amin, Susan Chapman-Hughes, Jay Henderson, Jonathan Johnson III, Kirk Perry, Alex Shumate, Jodi Taylor, and Dawn Willoughby.

In general, “independent” means that a director has no material relationship with us or any of our subsidiaries. The existence of a material relationship is determined upon a review of all relevant facts and circumstances and, generally, is a relationship that might reasonably be expected to compromise the director’s ability to maintain his or her independence from our management.

The Board considers the issue of materiality from the standpoint of the persons or organizations with which the director has an affiliation, as well as from the standpoint of the director.

The following standards will be applied by the Board in determining whether individual directors qualify as “independent” under the rules of the NYSE and the SEC. To the extent that these standards are more stringent than the rules of the NYSE or the SEC, such standards will apply. References to the Company include our consolidated subsidiaries.

 

  LOGO

No director will be qualified as independent unless the Board affirmatively determines that the director has no material relationship with us, either directly or as a partner, shareholder, or officer of an organization that has a relationship with us. We will disclose these affirmative determinations on an annual basis.

 

 

 

 

14    The J. M. Smucker Company       LOGO       2024 Proxy Statement

 

   

 

 

 


CORPORATE GOVERNANCE

 

  LOGO

No director who is a former employee of ours can be deemed independent until three years after the end of his or her employment relationship with us.

 

 

  LOGO

No director whose immediate family member is a former executive officer of the Company can be deemed independent until three years after the end of such executive officer’s relationship with us.

 

 

  LOGO

No director who receives, or whose immediate family member receives, more than $120,000 in direct compensation from the Company in any twelve-month period within the past three years, other than director and Committee fees and pension or other forms of deferred compensation for prior service (provided such compensation is not contingent in any way on continued service), can be deemed independent.

 

 

  LOGO

No director can be deemed independent if the director (i) is a current partner or employee of a firm that is our internal or external auditor; (ii) has an immediate family member who is a current partner of such a firm; (iii) has an immediate family member who is a current employee of such a firm and personally works on our audit; or (iv) was, or an immediate family member was, within the last three years, a partner or employee of such a firm and personally worked on our audit within that time.

 

 

  LOGO

No director who is employed, or whose immediate family member is employed, as an executive officer of another company where any of our present executive officers serve on that company’s compensation committee can be independent until three years after the end of such service or employment relationship.

 

 

  LOGO

No director who is an executive officer or employee, or whose immediate family member is an executive officer, of a company (excluding charitable organizations) that makes payments to, or receives payments from, us for property or services in an amount which, in any single fiscal year, exceeds the greater of $1,000,000 or 2% of such other company’s consolidated gross revenues can be deemed independent until three years after falling below such threshold.

 

 

  LOGO

No director can be deemed independent if we have made charitable contributions to any charitable organization in which such director serves as an executive officer if, within the preceding three years, contributions by us to such charitable organization in any single fiscal year of such charitable organization exceeded the greater of $1,000,000 or 2% of such charitable organization’s consolidated gross revenues.

 

In its review and application of the criteria used to determine independence, the Board considered the fact that we do business with organizations directly or indirectly affiliated with Paul Dolan, who retired from the Board in August 2023, and Kirk Perry, and affirmatively determined that the amounts paid to the entities affiliated with these individuals do not meet the threshold which would create an issue under the standards for determining independence.

The value of advertising and promotional activities sponsored with the Cleveland Guardians organization, of which Paul Dolan is the Chairman and Chief Executive Officer, in the first quarter of fiscal year 2024 was approximately $0.3 million and does not exceed the greater of $1,000,000 or 2% of the consolidated gross revenues of the Cleveland Guardians.

The value of consumer data, analytics, and insights services provided to us by Circana, Inc. (“Circana”), of which Kirk Perry is the President and Chief Executive Officer, in fiscal year 2024 was approximately $11.0 million and does not exceed the greater of $1,000,000 or 2% of consolidated gross revenues of Circana.

Structure of the Board of Directors

Chair of the Board and Chief Executive Officer as Director

The Regulations provide that one person may hold both positions of Chair of the Board and Chief Executive Officer. Mark Smucker currently serves as both Chair of the Board and Chief Executive Officer. The Board believes that a current or former Chief Executive Officer is best situated to serve as Chair of the Board, because he is one of the directors most familiar with our business and industry. The Board also believes that having a current or former Chief Executive Officer serve as Chair of the Board provides an efficient and effective leadership model for us by fostering clear accountability, effective

 

 

 

 

 

   

 

The J. M. Smucker Company       LOGO       2024 Proxy Statement      15  


CORPORATE GOVERNANCE

 

decision-making, and alignment of corporate strategy. The majority of our directors are independent, and the Board has a Lead Independent Director. The Board’s independent directors bring experience, oversight, and expertise from outside the Company and industry, while the Chair of the Board and Chief Executive Officer bring Company and industry-specific experience and expertise. One of the key responsibilities of the Board is to develop strategic direction and hold management accountable for the execution of its strategy once it is developed. The Board believes that its current management structure, together with independent directors having the duties described above and the Lead Independent Director having the duties described below, is in the best interests of shareholders because it strikes an appropriate balance for us; with a current or former Chief Executive Officer serving as Chair of the Board, there is unified leadership and a focus on strategic development and execution, while the independent directors help assure independent oversight of management.

Chairman Emeritus

Any member of the Smucker family who has previously served in the role of Chair of the Board may be appointed by the Board as a non-director Chairman Emeritus at such time as such individual ceases to be a member of the Board. The purpose of the Chairman Emeritus position is to permit the Company to continue to benefit from the participation and input of the Chairman Emeritus after such person has ceased to be a director and to permit the Chairman Emeritus to provide such participation and input to the Company and the Board. The term of a Chairman Emeritus will be one year from appointment, renewable annually by the Board, provided that the term of a Chairman Emeritus will not be renewed beyond the expiration of the term during which the Chairman Emeritus reaches the age of 80. Subject to any different determinations of the Board, a Chairman Emeritus:

 

  LOGO

Will receive notice of and may participate in Board meetings, but will generally not attend Board sessions that are limited to independent directors only;

 

 

  LOGO

May be invited to attend and participate in Committee meetings as determined by the Board or the applicable Committee, but will generally not attend Committee sessions that are limited to independent directors only;

 

 

  LOGO

Will not be entitled to vote and will not be counted for quorum purposes at Board or Committee meetings;

 

 

  LOGO

To the extent requested by the Company or the Board and agreed to by the Chairman Emeritus, will act as an advisor to the Company, including (i) participating in Company communications, (ii) participating in Company meetings, (iii) serving as a spokesperson with external constituents, and (iv) serving as an advisor to the Chief Executive Officer; and

 

 

  LOGO

Will provide such other advice and services and engage in such other activities as may be agreed between the Board and the Chairman Emeritus.

 

A Chairman Emeritus will be entitled to reimbursement of expenses incurred in connection with service in the role of Chairman Emeritus and to indemnification and insurance in connection with such service. Any additional compensation or other perquisites will be as determined by the Board. A Chairman Emeritus will remain subject to Section 16 reporting requirements, the Company’s Code of Conduct (as defined below) and Insider Trading and Disclosure Policy (the “Insider Trading Policy”), and the confidentiality and similar obligations applicable to a director of the Company but will not be considered a director or officer of the Company under the Company’s Amended Articles of Incorporation (the “Articles”) or Regulations, under the Ohio General Corporation Law, or otherwise. Following the end of his or her final term, a Chairman Emeritus may retain the title of Chairman Emeritus as an honorific, without any rights, responsibilities, or obligations. However, at the request of the Chief Executive Officer and upon mutual agreement, a Chairman Emeritus may engage in activities to enhance and support the culture of the Company and its constituents. The Board appointed Richard Smucker and Timothy Smucker as Chairman Emeriti on August 16, 2023 and will appoint both of them for another one-year term upon the expiration of their current term.

Board’s Role in Risk Oversight

Risk is inherent in any business, and our management is responsible for the day-to-day management of risks that we face. The Board, on the other hand, has responsibility for the oversight of risk management. In that role, the Board has the responsibility to evaluate the risk management process to ensure its adequacy and that it is implemented properly by management.

 

 

16    The J. M. Smucker Company       LOGO       2024 Proxy Statement

 

   

 

 

 


CORPORATE GOVERNANCE

 

The Board believes that full and open communication between management and the Board is essential for effective risk management and oversight. The Board meets regularly with senior management, including executive officers, to discuss strategy and risks facing the Company, including new and potentially disruptive risks such as those posed by supply chain disruptions, product recalls, cybersecurity incidents, and relevant geopolitical incidents. Senior management attends the Board’s quarterly meetings, as well as Committee meetings, to address any questions or concerns raised by the Board on risk management and any other matters. The Chief Compliance Officer manages the Company’s compliance function and oversees the enterprise risk function; chairs the Governance, Risk, and Compliance Committee; attends Board and Audit Committee meetings; and provides periodic updates on risks and compliance issues facing the Company and the industry. The Governance, Risk, and Compliance Committee, along with members from various functions across the Company, meet periodically to review enterprise risk issues, including top risk activities and changes, emerging risks, risk mitigation activities, and program maturity. Each quarter, the Board receives presentations from senior management on business operations, financial results, and strategic, risk, and compliance issues. In addition, senior management holds regular strategic planning sessions to discuss strategies, key challenges, and risks and opportunities for the Company. Senior management then reviews the results of each strategic planning session with the Board.

The Committees assist the Board in fulfilling its oversight responsibilities in certain areas of risk. The Audit Committee assists the Board in fulfilling its oversight responsibilities with respect to management of major financial risk exposures, including in the areas of financial reporting, internal controls, hedging strategies, and cybersecurity. Risk assessment reports are regularly provided by management, our internal auditors, and compliance professionals to the Audit Committee. In particular, the Audit Committee receives an update on cybersecurity and compliance matters at each regularly scheduled meeting and reports to the Board on key activities. The Board also receives an update on cybersecurity and compliance matters at least once a year. The Compensation Committee assists the Board in fulfilling its oversight responsibilities with respect to the management of risks arising from the Company’s people management and compensation policies and programs, including overseeing the Company’s compensation-related risk assessment described further below in this Proxy Statement and developing stock ownership and clawback guidelines for our executive officers. The Nominating Committee assists the Board in fulfilling its oversight responsibilities with respect to the management of risks associated with Board organization, membership, and structure, succession planning for directors and executive officers, and corporate governance, including monitoring corporate governance issues; overseeing the Company’s ESG processes, policies, commitments, and activities; developing director evaluations for the Board and the Committees; and reviewing potential conflicts of interest.

All Committees report back to the full Board at Board meetings as to the Committee’s activities and matters discussed and reviewed at the Committee’s meeting. In addition, the Board is encouraged to participate in internal and external director education courses, as described further in our Board Education Policy, to keep apprised of current issues, including areas of risk. External advisors also periodically present to the Board and the Committees on risks impacting the Company and the food industry.

Communications with the Board

Shareholders and others who wish to communicate with members of the Board as a group, with non-employee directors as a group, or with individual directors, may do so by writing to The J. M. Smucker Company, c/o Corporate Secretary, One Strawberry Lane, Orrville, Ohio 44667. The directors have requested that the Corporate Secretary act as their agent in processing any communications received. All communications that relate to matters within the scope of responsibilities of the Board and its Committees will be forwarded to the appropriate directors. Communications relating to matters within the responsibility of one of the Committees will be forwarded to the Chair of the appropriate Committee. Communications relating to ordinary business matters are not within the scope of the Board’s responsibility and will be forwarded to the appropriate executive officer at the Company. Solicitations, advertising materials, and frivolous or inappropriate communications will not be forwarded.

Commitment to Integrity: Our Code

Doing the Right Thing is one of our Basic Beliefs and is fundamental to our business. We emphasize that ethical conduct is vital to ensure successful, sustained business and business relationships. Our Commitment to Integrity: Our Code (the “Code of Conduct”) is an extension of our long-standing principles and values. It applies to our employees and directors. The Code

 

 

 

 

 

   

 

The J. M. Smucker Company       LOGO       2024 Proxy Statement      17  


CORPORATE GOVERNANCE

 

of Conduct is a resource which guides daily conduct in the workplace, and employees are expected to reference it frequently. The Code of Conduct outlines our expectations across numerous areas and situations in which ethical choices might be necessary, such as creating a positive work environment; embracing inclusion, diversity, and equity; engaging with customers, suppliers, and competitors; handling confidential information and conflicts of interest; the exchange of gifts, meals, and entertainment; avoiding bribery and corruption and insider trading; our commitment to community, including ESG matters and philanthropic activities; and rules regarding food safety, advertising, and product labeling. Employees and directors are required to review and acknowledge the Code of Conduct on an annual basis and receive training at least once every three years. Additionally, employees receive annual compliance training on key topics throughout the year.

Any amendments to the Code of Conduct and any waivers of the Code of Conduct for or on behalf of any director, executive officer, or senior financial officer of the Company must be approved by the Board or by a Committee of the Board to which authority to issue such waivers has been delegated by the Board. Any amendments or waivers of the Code of Conduct will be promptly disclosed to the public, as required by applicable law, and will be disclosed on our website at www.jmsmucker.com. Waivers of the Code of Conduct for any other employee may be made only by an authorized officer of the Company. As of the date of this Proxy Statement, there have been no such waivers.

Procedures for Reporting Ethical, Accounting, Auditing, and Financial Related Issues

The Board has established procedures for employees to report violations of the Code of Conduct or complaints regarding accounting, auditing, and financial-related matters to their manager or supervisor, to the Chief Compliance Officer, the Chief Legal Officer, or directly to the Audit Committee. Reports to the Chief Compliance Officer or Chief Legal Officer may be made in writing, by telephone, in person, or may be submitted anonymously through the Company’s Integrity Portal, which is managed by an independent third-party service provider and is available 24 hours a day, seven days a week, in multiple languages, and can be accessed via phone or through the Internet at JMSIntegrity.com. Specifically, via phone in the U.S. and Canada, employees or concerned individuals can call toll-free 1-844-319-9352; in other countries, employees or concerned individuals can access the applicable country number at JMSIntegrity.com. We forbid retaliation, or threats of retaliation, against our employees who, in good faith, report violations of the Code of Conduct.

Availability of Corporate Governance Documents

Copies of the Articles, Regulations, Guidelines, Director Resignation Policy, Code of Conduct, Stock Ownership Guidelines, Audit Committee Charter, Compensation and People Committee Charter, and Nominating, Governance, and Corporate Responsibility Committee Charter are posted on our website at www.jmsmucker.com and are available free of charge to any shareholder submitting a written request to the Corporate Secretary, The J. M. Smucker Company, One Strawberry Lane, Orrville, Ohio 44667.

 

 

18    The J. M. Smucker Company       LOGO       2024 Proxy Statement

 

   

 

 

 


ELECTION OF DIRECTORS

(Proposal 1 on the proxy card)

The Board currently has 10 directors, all of whom will be up for election at the Annual Meeting of Shareholders to hold office for a term of one year. Unless instructed otherwise, the proxies intend to vote FOR the election of these nominees.

Each nominee has agreed to serve if elected. If any nominee declines, is unable to accept such nomination, or is unable to serve (an event which is not expected), the Board reserves the right, in its discretion, to substitute another person or nominee or to reduce the number of nominees. In this event, the proxy, with respect to such nominee or nominees, will be voted for such other person or persons as the Board may recommend.

The members of the Board, including those who are listed in this Proxy Statement as nominees for election, with information about each of them based on data furnished to us by these persons as of June 28, 2024, are as follows:

Nominees for Election as Directors Whose Proposed Terms Would Expire at the 2025 Annual Meeting

 

 

LOGO

 

 MERCEDES

 ABRAMO

 

Age: 54

 

Director Since: 2023

 

Committee:

 Audit

 

Favorite Product:

 

 

LOGO

 

  Café Bustelo

 

 

 

Professional Experience

 

Ms. Abramo has been the Deputy Chief Commercial Officer of Cartier International SA (“Cartier”), an international chain of jewelry boutiques since March 2023. Prior to her current role at Cartier, Ms. Abramo held several positions of increasing responsibility, including President and Chief Executive Officer of North America; Vice President, Retail, North America; Assistant Vice President, Retail, New York Region; and Director, Fifth Avenue Mansion, United States Flagship. Prior to joining Cartier, Ms. Abramo spent five years with Tiffany & Co. in various Director positions and six years with various luxury hotels in management roles. Ms. Abramo is a founding member of Chief, a private network designed specifically for women leaders to strengthen their experience in the C-suite and effect change from the top down.

 

Skills and Qualifications

 

The Board concluded that Ms. Abramo should serve as a director primarily due to her experience serving as a chief executive officer and her extensive experience in managing and overseeing retail, hospitality, and luxury goods. Specifically, Ms. Abramo brings significant leadership, finance, operating, and strategy experience through her positions with Cartier and Tiffany & Co. Ms. Abramo’s background enables her to provide valuable insights to the Board, particularly in strategy, operations, e-commerce, people management, marketing, supply chain, and in overseeing the Company’s finances and ESG areas.

 

 

   

 

 

 

 

   

 

The J. M. Smucker Company       LOGO       2024 Proxy Statement      19  


ELECTION OF DIRECTORS

 

 

LOGO

 

 TARANG

 AMIN

 

Age: 59

 

Director Since: 2023

 

 Committee:

 Compensation

 

Favorite Product:

 

 

 

LOGO

 

  Uncrustables

 

 

 

Professional Experience

 

Mr. Amin has been the Chairman and Chief Executive Officer of e.l.f. Beauty, Inc. (“e.l.f. Beauty”), a publicly traded cosmetics company since August 2015. He took the company public in 2016 in one of the most successful initial public offerings in the beauty industry. Mr. Amin also served as President, Chief Executive Officer, and Director of e.l.f. Beauty from February 2014 through July 2015. Prior to joining e.l.f. Beauty, he was President, Chief Executive Officer, and Director of Schiff Nutrition International (“Schiff Nutrition”), a publicly traded nutritional supplements company, from March 2011 through March 2013 and held various leadership roles at The Clorox Company (“Clorox”) and The Procter & Gamble Company (“P&G”). Mr. Amin has been a director of Pharmavite, LLC, a dietary supplements company, since January 2020 and served as a director of Angie’s BOOMCHICKAPOP, a natural and organic snack brand, from June 2014 through October 2017.

 

Skills and Qualifications

 

The Board concluded that Mr. Amin should serve as a director primarily due to his extensive leadership experience at consumer goods companies and his experience serving as a director of other companies. Specifically, he brings significant leadership, finance, operating, and strategy experience through his positions with e.l.f. Beauty, Schiff Nutrition, Clorox, and P&G. Mr. Amin’s background enables him to provide valuable insights to the Board, particularly in strategy, operations, e-commerce, people management, marketing, supply chain, corporate governance, and overseeing our executive compensation practices.

 

 

   

 

 

LOGO

 

 SUSAN

 CHAPMAN-

 HUGHES

 

Age: 55

 

Director Since: 2020

 

 Committee:

 Compensation

 (Chair)

 

Favorite Product:

 

 

LOGO

 

  Smucker’s Hot Fudge

  Sauce

 

 

 

Professional Experience

 

Ms. Chapman-Hughes was the Executive Vice President and General Manager, Global Head of Digital Capabilities, Transformation, and Operations, Global Commercial Services of American Express Company, a financial services corporation, from February 2018 through February 2021. Prior to this role, Ms. Chapman-Hughes served in several Senior Vice President level positions since joining American Express Company in 2010. She is also a director, the chair of the compensation committee, and a member of the nominating and governance committee of Toast, Inc., a publicly traded cloud-based restaurant software company, since February 2021. In addition, Ms. Chapman-Hughes served as a director, the chair of the compensation committee, and a member of the nominating and governance committee of Potbelly Corporation, a publicly traded restaurant company, from May 2014 through June 2020.

 

Skills and Qualifications

 

The Board concluded that Ms. Chapman-Hughes should serve as a director primarily due to her significant experience in managing and overseeing businesses, as well as her strong corporate governance experience as a member of a public company board. Specifically, Ms. Chapman-Hughes brings leadership and operating skills through her former roles with American Express Company. Ms. Chapman-Hughes’s background enables her to provide valuable insights to the Board, particularly in sales, strategy, digital capabilities and technology, innovation, change management, and overseeing our executive compensation and ESG practices.

 

 

   

 

 

20    The J. M. Smucker Company       LOGO       2024 Proxy Statement

 

   

 

 

 


ELECTION OF DIRECTORS

 

 

LOGO

 

 JAY

 HENDERSON

 

Age: 68

 

Director Since: 2016

 

 Committee:

 Audit

 

Favorite Product:

 

 

LOGO

 

  Uncrustables

 

 

 

Professional Experience

 

Mr. Henderson retired as Vice Chairman, Client Service at PricewaterhouseCoopers LLP (“PricewaterhouseCoopers”) in June 2016, a position he held since 2007. He also served as PricewaterhouseCoopers’ Managing Partner of the Greater Chicago Market from 2003 through 2013. During his career at PricewaterhouseCoopers, Mr. Henderson gained significant experience working with the boards and audit committees of Fortune 500 companies and has managed major client relationships across multiple markets and industry sectors. He is the lead director, chair of the audit committee, and a member of the corporate governance, capital governance, human capital and compensation, business risk, and executive committees of Northern Trust Corporation, a publicly traded financial holding company, where he has served since July 2016, and a director, chair of the audit committee, and member of the finance and executive committees of Illinois Tool Works Inc., a publicly traded global multi-industrial manufacturer of specialized industrial equipment, consumables, and related service businesses, where he has served since August 2016. Mr. Henderson is also a member of the boards of several non-profit organizations.

 

Skills and Qualifications

 

The Board concluded that Mr. Henderson should serve as a director primarily due to his extensive experience in managing and overseeing businesses, his experience working with the boards and audit committees of large public companies, and his experience serving as a director of public companies and non-profit organizations. Specifically, Mr. Henderson brings leadership and operating skills through his former roles with PricewaterhouseCoopers. He has also been a Certified Public Accountant since 1977. Mr. Henderson’s background enables him to provide valuable insights to the Board, particularly in strategy, compliance, risk management, and overseeing the Company’s finances.

 

 

   

 

 

LOGO

 

 JONATHAN

 JOHNSON III

 

Age: 58

 

Director Since: 2022

 

 Committee:

 Compensation

 

Favorite Product:

 

 

LOGO

 

  Smucker’s Apple Butter

 

 

 

Professional Experience

 

Mr. Johnson was the Chief Executive Officer of Overstock.com, Inc. (now known as Beyond, Inc.) (“Overstock”), an online home furnishings retailer, from September 2019 through November 2023, and a member of its board of directors, from May 2013 until November 2023. He also served as Overstock’s General Counsel, Senior Vice President, President, Executive Vice Chairman, Chairman, and Interim Chief Executive Officer. Between August 2016 and April 2021, Mr. Johnson served as the director and president of Medici Ventures, the corporate venture arm and former Overstock.com subsidiary. Prior to joining Overstock.com, Mr. Johnson was with TenFold Corporation, a software and services company, from May 1999 to September 2002 where he held various positions, including General Counsel and Chief Financial Officer. Mr. Johnson is also a member of the boards of several non-profit organizations.

 

Skills and Qualifications

 

The Board concluded that Mr. Johnson should serve as a director primarily due to his extensive ecommerce and blockchain experience. Specifically, Mr. Johnson brings leadership and operating skills through his current and former roles with Overstock.com. Mr. Johnson’s background enables him to provide valuable insights to the Board, particularly in ecommerce, blockchain, supply chain, marketing, operations, general management, mergers and acquisitions, consumer products, technology, digital media, finance, risk management, and overseeing our executive compensation and ESG practices.

 

 

   

 

 

 

 

 

   

 

The J. M. Smucker Company       LOGO       2024 Proxy Statement      21  


ELECTION OF DIRECTORS

 

 

LOGO

 

 KIRK

 PERRY

 

Age: 57

 

Director Since: 2017

 

 Committee:

 Nominating

 

Favorite Product:

 

 

LOGO

 

  Uncrustables

  (Hazelnut)

 

 

 

Professional Experience

 

Mr. Perry has been the President and Chief Executive Officer and a member of the board of directors of Circana, a global provider of technology, data, and predictive analytics for the consumer, retail, and media sectors, since May 2021. Prior to joining Circana, he spent seven years as the President, Brand Solutions of Google Inc. and twenty-three years with P&G, where he held several positions of increasing responsibility in marketing and general management roles, including President, Global Family Care from May 2011 to December 2013. Mr. Perry is a board member of Chick-Fil-A, Inc., a privately-owned restaurant company, since August 2022. He previously served as a director of e.l.f. Beauty, a publicly traded cosmetics company, from September 2016 to November 2022, and Hillerich & Bradsby Co. (Louisville Slugger), a privately-owned sporting goods manufacturer, from September 2013 to August 2016. He is also a member of the boards of several non-profit organizations.

 

Skills and Qualifications

 

The Board concluded that Mr. Perry should serve as a director primarily due to his extensive operational experience in marketing and brand management and his experience serving as a director of other organizations. Specifically, Mr. Perry brings leadership and operating skills through his current and former roles with Circana, Google, Inc., and P&G. Mr. Perry’s background enables him to provide valuable insights to the Board, particularly in marketing, operations, general management, consumer products, technology, and digital media.

 

 

   

 

 

LOGO

 

 ALEX

 SHUMATE

 

  Lead Independent Director

 

Age: 74

 

Director Since: 2009

 

 Committee:

 Nominating

 

Favorite Product:

 

 

LOGO

 

  Uncrustables (Grape)

 

 

 

Professional Experience

 

Mr. Shumate is a Senior Partner and the Ohio Strategic Relationship Partner of Squire Patton Boggs (US) LLP (“Squire Patton Boggs”), where he has practiced law since February 1988. He was the North American Managing Partner of Squire Patton Boggs from January 2012 to January 2021. Mr. Shumate is a founding director for Adelphi Bank, a Minority Depository Institution. He previously served as a director of CyrusOne Inc., a publicly traded provider of data center consulting services, from January 2013 until its acquisition in March 2022, and a director of Cincinnati Bell, Inc., a publicly traded provider of voice and data telecommunications products and services, from 2005 to 2013. Mr. Shumate also served as a member of the boards of several non-profit organizations, including three separate terms on The Ohio State University Board of Trustees.

 

Skills and Qualifications

 

The Board concluded that Mr. Shumate should serve as a director primarily due to his significant legal background and his experience in managing a business and serving as a director of other public companies and as a trustee of several non-profit organizations. Mr. Shumate has practiced law for nearly 50 years and was named a Lawyer of the Year by Best Lawyers in 2018 and an Ohio Super Lawyer by Law and Politics magazine. In 2019, he was honored by Columbus Business First as one of the region’s Most-Admired Executives, and in 2020 he was named to the Power 100 list of 2020’s most influential leaders. Together with his service as a director of other public companies, Mr. Shumate’s background allows him to provide valuable insights to the Board, particularly in regard to strategy, corporate governance, people management, risk management, and overseeing our ESG practices.

 

 

   

 

 

22    The J. M. Smucker Company       LOGO       2024 Proxy Statement

 

   

 

 

 


ELECTION OF DIRECTORS

 

 

LOGO

 

 MARK

 SMUCKER

 

Age: 54

 

Director Since: 2009

 

 Committee:

 None

 

Favorite Product:

 

 

LOGO

 

  Folger’s Black Silk

 

 

 

Professional Experience

 

Mr. Smucker has been our Chair of the Board, President, and Chief Executive Officer since August 2022. Prior to that time, he served as President and Chief Executive Officer, from May 2016 through August 2022; President and President, Consumer and Natural Foods, from April 2015 through April 2016; President, U.S. Retail Coffee, from May 2011 through March 2015; and President, Special Markets, from August 2008 through April 2011. He is a director, chair of the nominating and corporate governance committee, and member of the executive committee of Kimberly-Clark Corporation, a publicly traded global company that manufactures and sells consumer products, where he has served since September 2019. Mr. Smucker is the son of Timothy Smucker and nephew of Richard Smucker, both of whom serve as Chairman Emeriti of the Board.

 

Skills and Qualifications

 

The Board concluded that Mr. Smucker should serve as a director largely due to his role as our President and Chief Executive Officer, his significant knowledge of the Company gained from more than 26 years of experience in various positions within the Company, his experience serving as a director of the Consumer Brands Association and FMI—The Food Industry Association, and his prior experience as a former director and member of the compensation committee of GS1 U.S. The Board believes that the perspectives that Mr. Smucker brings to the Board are particularly valuable in light of the significance of the coffee and consumer foods businesses to the Company. The Board also believes that continuing participation by qualified members of the Smucker family on the Board is an important part of our corporate culture that has contributed significantly to our long-term success.

 

 

   

 

 

LOGO

 

 JODI

 TAYLOR

 

Age: 61

 

Director Since: 2020

 

 Committee:

 Audit (Chair)

 

Favorite Product:

 

 

LOGO

 

  Smucker’s Strawberry Jam

 

 

 

Professional Experience

 

Ms. Taylor retired as an executive officer of The Container Store Group, Inc., a publicly traded specialty retailer of storage and organization products, in March 2021. She was the Chief Financial Officer from December 2007 through August 2020, the Secretary from October 2013 through March 2021, and the Chief Administrative Officer from July 2016 through March 2021. Prior to joining The Container Store Group, Inc., Ms. Taylor spent nine years as the Chief Financial Officer and Secretary of Harold’s Stores, Inc., a regional specialty retailer of high-end apparel. In addition, Ms. Taylor is a director and chair of the audit committee of Mister Car Wash, Inc., a publicly traded company that is the largest car wash brand in the United States, where she has served since June 2021. She has been a certified public accountant since 1984 (inactive since 2021), starting with an accounting role at Deloitte & Touche L.L.P. She received her CERT Certificate in Cybersecurity Oversight in March 2023.

 

Skills and Qualifications

 

The Board concluded that Ms. Taylor should serve as a director primarily due to her extensive experience in managing and overseeing the businesses of both public and private companies, and her long career in the consumer retail and packaged goods industries. Specifically, Ms. Taylor brings significant leadership, finance, operating, and governance skills through her positions with The Container Store, Inc. and Harold’s Stores, Inc. Ms. Taylor’s background enables her to provide valuable insights to the Board, particularly in strategy, compliance, risk management, human resources, and overseeing our finances, cybersecurity, and ESG practices.

 

 

   

 

 

 

 

 

   

 

The J. M. Smucker Company       LOGO       2024 Proxy Statement      23  


ELECTION OF DIRECTORS

 

 

LOGO

 

 DAWN

 WILLOUGHBY

 

Age: 55

 

Director Since: 2017

 

 Committee:

 Nominating (Chair)

 

Favorite Product:

 

LOGO

 

  Smucker’s Natural

  Blackberry Fruit Spread

 

 

 

Professional Experience

 

Ms. Willoughby was the Executive Vice President and Chief Operating Officer of Clorox, a manufacturer and marketer of consumer and professional products, from September 2014 through January 2019. She also served as the company’s Senior Vice President and General Manager, Clorox Cleaning Division; Vice President and General Manager, Home Care Products; and Vice President and General Manager, Glad Products, along with several other positions since she was initially hired in 2001. Prior to Ms. Willoughby’s career at Clorox, she spent nine years with P&G, where she held several positions in sales management. Ms. Willoughby is a director and member of the human capital and compensation and governance and corporate responsibility committees of International Flavors and Fragrances, Inc., a publicly traded global company that produces flavors, fragrances, and cosmetic actives, where she has served since February 2023, and a director and member of the management development and compensation committee of TE Connectivity Ltd., a publicly traded global company that provides connectivity and sensor solutions, where she has served since March 2020.

 

Skills and Qualifications

 

The Board concluded that Ms. Willoughby should serve as a director primarily due to her extensive leadership experience at consumer goods companies and her experience serving as a director of other organizations. Specifically, Ms. Willoughby brings leadership and operating skills through her former roles with Clorox and P&G and insights regarding ESG through her former role with Clorox. Ms. Willoughby’s background enables her to provide valuable insights to the Board, particularly in management, strategy, sales, marketing, governance, and overseeing our ESG practices.

 

 

   

 

 

 

The Board unanimously recommends a vote FOR each of the nominees named in this

Proxy Statement for election to the Board.

 

 

 

24    The J. M. Smucker Company       LOGO       2024 Proxy Statement

 

   

 

 

 


BOARD AND COMMITTEE MEETINGS

Board Meetings

During fiscal year 2024, there were six meetings of the Board. All directors are required to attend at least 75% of the total number of Board and Committee meetings for which they were eligible. During fiscal year 2024, all directors attended at least 75% of the total number of Board and Committee meetings for which they were eligible. We have not adopted a formal policy requiring directors to attend the Annual Meeting of Shareholders. However, all directors attended the 2023 virtual Annual Meeting of Shareholders.

The Board has an Audit Committee, a Compensation Committee, and a Nominating Committee. All Committees are comprised entirely of independent Directors in accordance with the NYSE listing standards. Each Committee operates under a written charter, which is posted on our website at www.jmsmucker.com. Each Committee believes that its charter is an accurate and adequate statement of such Committee’s responsibilities, and each Committee reviews its charter on an annual basis to confirm that it continues to be an accurate and adequate statement of such responsibilities. Each Committee amended its charter in fiscal year 2024.

The table below shows current members of each of the Committees and the number of meetings held by each Committee in fiscal year 2024.

 

 Name

 

 

Audit Committee

 

  Compensation
Committee
 

 

Nominating
Committee

 Mercedes Abramo

 

LOGO

 

   

 Tarang Amin

   

LOGO

 

 

 Susan Chapman-Hughes

   

LOGO

 

 Jay Henderson

 

LOGO  F

 

   

 Jonathan Johnson III

   

LOGO

 

 

 Kirk Perry

     

LOGO

 

 Alex Shumate

     

LOGO

 

 Jodi Taylor

 

LOGO  F

 

   

 Dawn Willoughby

         

LOGO

 

 Number of Meetings

 

11

 

6

 

3

 

LOGO Chair    LOGO Member    F  Financial Expert

   

 

 

 

 

   

 

The J. M. Smucker Company       LOGO       2024 Proxy Statement      25  


BOARD AND COMMITTEE MEETINGS

 

Director Compensation

We use a combination of cash and stock-based compensation to attract, compensate, and retain non-employee directors who serve on the Board. The Compensation Committee engages its outside compensation consultant, Semler Brossy Consulting Group (“Semler Brossy”), to perform an annual review of director compensation in order to remain aware of current trends in director compensation. At the Compensation Committee’s January 2024 meeting, Semler Brossy presented a competitive review of director compensation (which is evaluated against the peer group set forth on page 56 of this Proxy Statement) and director compensation trends. Based on this review, the Compensation Committee recommended, and the Board approved a $5,000 increase to the annual retainer for the chairs of the Audit Committee and Compensation Committee for fiscal year 2025. Employee directors do not receive compensation for their services as directors.

For fiscal year 2024, non-employee directors received the following compensation:

 

 

Type of Compensation

 

  

 

Amount

 

Annual Retainer

  

$100,000 per year

Additional Annual Retainer for Lead Independent Director

  

$ 30,000 per year

Additional Annual Retainer for Audit Committee Members

  

$  5,000 per year

Additional Annual Retainer for Committee Chair

  

$ 15,000 per year

Annual Grant of Deferred Stock Units

  

$160,000 in deferred stock units 

The annual grant of deferred stock units having a value of $160,000 is made in October of each year. The deferred stock units are awarded under The J. M. Smucker Company 2020 Equity and Incentive Compensation Plan (the “2020 Plan”), which was approved by our shareholders at our 2020 Annual Meeting. The deferred stock units vest immediately upon grant and are entitled to dividends in an amount paid to all shareholders. These dividends are reinvested in additional deferred stock units.

Non-employee directors may elect to receive a portion of their annual retainer in the form of deferred stock units. Such amounts are deferred under the Nonemployee Director Deferred Compensation Plan, which was initially adopted by the Board on January 1, 2007, and most recently amended and restated on January 1, 2021 (the “Nonemployee Director Deferred Compensation Plan”). All deferred stock units, together with dividends credited on those deferred stock units, will be paid out in the form of common shares upon termination of service as a non-employee director (subject to a waiting period for deferred stock units granted in certain years).

For fiscal year 2025, non-employee directors will receive the following compensation:

 

 

Type of Compensation

 

  

 

Amount

 

Annual Retainer

  

$100,000 per year

Additional Annual Retainer for Lead Independent Director

  

$ 30,000 per year

Additional Annual Retainer for Audit Committee Members

  

$  5,000 per year

Additional Annual Retainer for Audit Committee and Compensation Committee Chairs

  

$ 20,000 per year

Additional Annual Retainer for Nominating Committee Chair

  

$ 15,000 per year

Annual Grant of Deferred Stock Units

  

$160,000 in deferred stock units 

 

 

26    The J. M. Smucker Company       LOGO       2024 Proxy Statement

 

   

 

 

 


BOARD AND COMMITTEE MEETINGS

 

The following table reflects compensation earned by the non-employee directors for fiscal year 2024:

2024 Director Compensation

 

Name

(1) (2)

 

  

 

Fees Earned or

Paid in Cash

($)

 

  

 

Stock

Awards

($) (3)

 

  

 

Option

Awards

($) (4)

 

  

 

All Other

Compensation

($) (5) (6)

 

    

Total

($)

 

 

Mercedes Abramo

  

$105,000

  

$160,000

  

  

 

 

  

 

$265,000 

 

Tarang Amin

  

$100,000

  

$160,000

  

  

 

$5,000  

 

  

 

$265,000 

 

Susan Chapman-Hughes

  

$115,000

  

$160,000

  

  

 

 

  

 

$275,000 

 

Paul Dolan (7)

  

$ 16,666

  

  

  

 

 

  

 

$ 16,666 

 

Jay Henderson

  

$105,000

  

$160,000

  

  

 

 

  

 

$265,000 

 

Jonathan Johnson III

  

$100,000

  

$160,000

  

  

 

 

  

 

$260,000 

 

Kirk Perry

  

$100,000

  

$160,000

  

  

 

 

  

 

$260,000 

 

Sandra Pianalto (7)

  

$ 16,666

  

  

  

 

 

  

 

$ 16,666 

 

Alex Shumate

  

$130,000

  

$160,000

  

  

 

 

  

 

$290,000 

 

Richard Smucker (8)

  

$100,000

  

  

  

 

$5,000  

 

  

 

$105,000 

 

Timothy Smucker (9)

  

$100,000

  

  

  

 

 

  

 

$100,000 

 

Jodi Taylor

  

$120,000

  

$160,000

  

  

 

 

  

 

$280,000 

 

Dawn Willoughby

  

$115,000

  

$160,000

  

  

 

 

  

 

$275,000 

 

 

(1)

Mark Smucker is not included in this table as he is an employee of the Company and receives no compensation for his service as a director. The compensation received by Mark Smucker as an employee of the Company is shown in the “Summary Compensation Table” on page 65 of this Proxy Statement.

 

(2)

As of April 30, 2024, each non-employee director had the aggregate number of deferred stock units shown in the following table. Deferred stock units include deferred meeting and retainer compensation and annual stock unit awards valued at a predetermined dollar amount, along with additional stock units credited as a result of the reinvestment of dividends. None of the non-employee directors have any stock options.

 

Name

  

 

Deferred

Stock Units

Mercedes Abramo

  

 1,341

Tarang Amin

  

 1,946

Susan Chapman-Hughes

  

 5,336

Jay Henderson

  

11,221

Jonathan Johnson III

  

 2,843

Kirk Perry

  

16,303

Alex Shumate

  

23,991

Jodi Taylor

  

 5,336

Dawn Willoughby

  

12,769

 

(3)

The amounts set forth in this column reflect the aggregate grant date fair value, as computed in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 718 (“ASC Topic 718”), for stock awards granted to the non-employee directors in the fiscal year ended April 30, 2024.

 

 

 

 

 

   

 

The J. M. Smucker Company       LOGO       2024 Proxy Statement      27  


BOARD AND COMMITTEE MEETINGS

 

(4)

No stock options were awarded to non-employee directors in fiscal year 2024.

 

(5)

The amount set forth in this column for Tarang Amin and Richard Smucker reflects a charitable matching gift under our matching gift program, which is available to all our full-time employees, directors, and retirees. We match gifts of up to $5,000 per calendar year for Company leadership (inclusive of executive officers) and directors and $2,500 per year for other full-time employees to accredited colleges and universities that offer four-year degree programs and to certain other designated charitable organizations. We also match gifts of up to an additional $2,500 for Company leadership (inclusive of executive officers) and directors to charitable organizations on whose board he or she serves. In addition, we made a $25,000 donation to the Cleveland Guardians Charities in honor of Paul Dolan’s retirement from the Board.

 

(6)

Non-employee directors occasionally receive perquisites provided by or paid by us. During fiscal year 2024, these perquisites included samples of our products. The aggregate value of all benefits provided to each non-employee director in fiscal year 2024 was less than $10,000.

 

(7)

After many years of distinguished service, Paul Dolan and Sandra Pianalto retired from the Board on August 16, 2023.

 

(8)

The Board appointed Richard Smucker as a Chairman Emeritus upon his retirement from the Board on August 16, 2023, and will appoint him for another one-year term upon the expiration of his current term. In such role, Mr. Smucker is entitled to (i) administrative resource and office support, (ii) reimbursement of reasonable business expenses, and (iii) an annual cash retainer of $100,000 payable in quarterly installments. For fiscal year 2024, Mr. Smucker was compensated as a Director from May 1, 2023, until his retirement from the Board and, after such date, he was compensated as a Chairman Emeritus. Mr. Smucker has elected to waive his annual cash retainer for his one-year term commencing after our Annual Meeting of Shareholders.

 

(9)

The Board appointed Timothy Smucker as a Chairman Emeritus on August 16, 2023, and will appoint him for another one-year term upon the expiration of his current term. In such role, Mr. Smucker is entitled to (i) administrative resource and office support, (ii) reimbursement of reasonable business expenses, and (iii) an annual cash retainer of $100,000 payable in quarterly installments. Mr. Smucker has elected to waive his annual cash retainer for his one-year term commencing after our Annual Meeting of Shareholders.

Stock Ownership Requirements

The Board has established a minimum share ownership requirement for non-employee directors equal in value to five times the annual cash retainer paid to each non-employee director. The Board policy also provides that each non-employee director should attain this ownership threshold within five years of joining the Board. All non-employee directors have met or exceeded the ownership requirement, with the exception of Mercedes Abramo and Jonathan Johnson III, who were elected to the Board in August 2023 and February 2022, respectively.

Executive Sessions and Lead Independent Director

On a regular basis, the independent directors hold meetings in executive session without the presence of management. In fiscal year 2024, the Board held four regularly scheduled executive sessions, as well as two executive sessions following special meetings, in which only the independent directors were present. As provided in the Guidelines, these meetings were chaired by Alex Shumate, the Lead Independent Director.

Meetings of the independent directors are chaired by the Lead Independent Director, who is recommended by the Nominating Committee and selected by the independent directors with input from the Chair of the Board. The Lead Independent Director serves at the pleasure of the Board for a term of five years or such other term as the Board may decide or until he or she is no longer a director or no longer meets the definition of an independent director. The Lead Independent Director may be removed by the independent directors with or without cause at any time without notice. The Lead Independent Director coordinates the activities of the other independent directors and performs such other duties and responsibilities as the Board may determine, including the following:

 

  LOGO

Preside at all meetings of the Board at which the Chair of the Board is not present;

 

 

  LOGO

Serve as a liaison between the Chief Executive Officer and the independent directors;

 

 

 

28    The J. M. Smucker Company       LOGO       2024 Proxy Statement

 

   

 

 

 


BOARD AND COMMITTEE MEETINGS

 

  LOGO

Call executive sessions or meetings of the independent directors and preside at all such executive sessions or meetings;

 

 

  LOGO

Provide input regarding meeting materials sent to the Board, including the quality, quantity, appropriateness, and timeliness of such information;

 

 

  LOGO

Provide input regarding meeting agendas and schedules for the Board meetings;

 

 

  LOGO

Serve as an advisor to the Committee chairs in fulfilling their designated roles and responsibilities to the Board;

 

 

  LOGO

Provide Board performance feedback to the Chair of the Board and assist with Board and Committee evaluations;

 

 

  LOGO

Recommend consultants or outside advisors to the Board as necessary or appropriate;

 

 

  LOGO

Assist with recruitment of director candidates; and

 

 

  LOGO

Lead the evaluation of the Chief Executive Officer with support from the Chair of the Compensation Committee.

 

 

 

 

 

 

   

 

The J. M. Smucker Company       LOGO       2024 Proxy Statement      29  


BOARD AND COMMITTEE MEETINGS

 

 

Nominating, Governance, and Corporate Responsibility
Committee

 

Meetings in Fiscal Year 2024: 3

 

Current Committee Members:

 

Dawn Willoughby (Chair)

Kirk Perry

Alex Shumate

 

 

Primary Responsibilities

 

LOGO   Developing qualifications and criteria for selecting and evaluating director nominees and evaluating current directors

 

LOGO   Completing customary vetting procedures and background checks for individuals suggested for potential Board membership

 

LOGO   Considering and proposing director nominees for election at our Annual Meeting of Shareholders

 

LOGO   Recommending candidates to fill Board vacancies as they may occur

 

LOGO   Making recommendations to the Board regarding memberships for the Nominating Committee, the Audit Committee, and the Compensation Committee

 

LOGO   Developing and generally monitoring the Guidelines and, at least annually, leading the directors in a discussion of major corporate governance issues

 

LOGO   Reviewing and making recommendations to the Board regarding proposed changes to our Articles and Regulations

 

LOGO   Reviewing shareholder proposals relating to corporate governance and other matters and recommending responses to the Board

 

LOGO   Developing and implementing an annual self-evaluation process of the Board’s performance and sharing the results with the Board

 

LOGO   Considering potential conflicts of interest of directors and management and making recommendations to prevent, minimize, or eliminate such conflicts

 

LOGO   Reviewing annually, or more frequently if necessary, succession planning for our executive officers and directors and reporting its findings and recommendations to the Board

 

LOGO   Making recommendations to the Board regarding director orientation and continuing training and reviewing annually a report on the educational programs attended and reported by each director

 

LOGO   Overseeing shareholder engagement efforts and developing procedures for shareholders to communicate with the Board

 

LOGO   Administering the annual evaluation of the Board

 

LOGO   Reviewing and discussing with senior management the Company’s risks associated with the Board’s organization, membership, and structure, succession planning for directors and executive officers, and corporate governance

 

LOGO   Supporting and assisting the Board in overseeing the Company’s ESG policies, processes, and commitments and receiving regular updates from management regarding the Company’s ESG activities

 

LOGO   Appointing the members of the Charitable Contributions Committee and overseeing the activities and contributions of such committee

 

LOGO   Performing other functions or duties deemed appropriate by the Board

 

 

 

30    The J. M. Smucker Company       LOGO       2024 Proxy Statement

 

   

 

 

 


BOARD AND COMMITTEE MEETINGS

 

 

Compensation and People Committee

 

Meetings in Fiscal Year 2024: 6

 

Current Committee Members:

 

Susan Chapman-Hughes (Chair)

Tarang Amin

Jonathan Johnson III

 

 

Primary Responsibilities

 

LOGO   Establishing, reviewing, and implementing our compensation philosophy

 

LOGO   Reviewing and approving corporate performance goals and objectives relating to compensation of our executive officers, including performance goals and objectives tied to ESG metrics, and evaluating our executive officers’ performance against these goals

 

LOGO   Evaluating the performance of the Chief Executive Officer in concert with the Lead Independent Director

 

LOGO   Considering the compensation of the Chief Executive Officer in relation to performance and the market and making recommendations to the independent directors for their approval

 

LOGO   Reviewing and approving the annual base salaries and incentive compensation opportunities of our executive officers

 

LOGO   Reviewing and approving any proposed employment, consulting, change-in-control, or other agreement, or any proposed benefit, severance, or retention plan with our executive officers

 

LOGO   Approving and administering the terms and policies of our equity incentive plans and grants of equity or equity-based awards for our executive officers

 

LOGO   Appointing the members of the Benefit Plans Design Committee and overseeing the activities of such committee

 

LOGO   Reviewing compensation issues related to key management succession and pay equity

 

LOGO   Supporting the Board in overseeing, monitoring, and reporting on our strategies and policies related to key people management policies and practices, including with respect to matters such as inclusion, diversity, and equity, workplace environment, and talent development and retention

 

LOGO   Overseeing regulatory compliance with respect to compensation matters

 

LOGO   Reviewing the compensation paid to non-employee directors and, as appropriate, making recommendations to the Board

 

LOGO   With the assistance of our management and any outside consultants the Compensation Committee deems appropriate, overseeing the risk assessment of our compensation arrangements and reviewing, at least annually, the relationship (if any) between our risk management policies and practices and our compensation arrangements

 

LOGO   Overseeing shareholder communications and shareholder votes on executive compensation matters, including the frequency of such votes, and assessing the results of shareholder advisory votes on executive compensation

 

LOGO   Developing stock ownership guidelines for our directors and executive officers and monitoring compliance with such guidelines

 

LOGO   Selecting an appropriate peer group of companies of similar size in similar industries, targeting an appropriate total pay positioning in relation to such peer group, and monitoring the competitiveness of executive officer pay against such peer group in relation to the Company’s relative performance

 

 

 

 

 

 

   

 

The J. M. Smucker Company       LOGO       2024 Proxy Statement      31  


BOARD AND COMMITTEE MEETINGS

 

   
   

LOGO   Assessing the independence of, setting the fees or other retention terms for, and engaging compensation consultants and other advisers to help evaluate non-employee director and executive officer compensation

 

LOGO   Overseeing the implementation and administration of any clawback or recoupment policy allowing the Company to recoup compensation paid to employees covered under such policy

 

LOGO   Performing other functions or duties deemed appropriate by the Board

 

Additional information about the Compensation Committee and related topics is provided in the “Compensation Discussion and Analysis” section of this Proxy Statement.

 

Report

 

The Compensation Committee Report is set forth on page 64 of this Proxy Statement.

 

 

 

32    The J. M. Smucker Company       LOGO       2024 Proxy Statement

 

   

 

 

 


BOARD AND COMMITTEE MEETINGS

 

 

Audit Committee

 

Meetings in Fiscal Year 2024: 11

 

(includes video or in-person meetings to review the Company’s quarterly and annual filings with the SEC on Form 10-Q and Form 10-K, respectively, and earnings release information)

 

Current Committee Members:

 

Jodi Taylor (Chair)

Mercedes Abramo

Jay Henderson

 

 

Primary Responsibilities

 

LOGO  Determining annually that at least one of its members meets the definition of “audit committee financial expert” as defined by Regulation S-K

 

LOGO  Reviewing annually the financial literacy of each of its members, as required by the NYSE

 

LOGO  Appointing and periodically reviewing the performance of the Independent Auditors and pre-approving all services and related fees for the year

 

LOGO  Reviewing with the Independent Auditors the scope and thoroughness of the Independent Auditors’ examination and considering recommendations of the Independent Auditors

 

LOGO  Reviewing the sufficiency and effectiveness of our system of internal controls, including compliance with Section 404 of the Sarbanes-Oxley Act of 2002, with our financial officers, the Independent Auditors, and, to the extent the Audit Committee deems necessary, legal counsel

 

LOGO  Reviewing and discussing our earnings press releases and quarterly and annual filings with the SEC on Form 10-Q and Form 10-K, respectively

 

LOGO  Reviewing and overseeing our policies, procedures, controls, and compliance with respect to the financial reporting of ESG matters

 

LOGO  Overseeing the Internal Audit function, including approving the appointment and annual compensation of the lead internal auditor, reviewing summaries and reports from Internal Audit, and approving the annual Internal Audit plan

 

LOGO  Reviewing and monitoring, with our senior management, our overall financial risk exposures and risk management process, including reviewing our risk management hedging strategies and cybersecurity processes and risk mitigation strategies

 

LOGO  Overseeing the Ethics and Compliance function, including establishing procedures for addressing complaints regarding accounting, internal controls, or other auditing matters; reviewing reports to confirm the Company is in compliance with applicable legal requirements; reviewing legal and regulatory matters that have a material impact on the financial statements, policies, and internal controls of the Company; and receiving reports of any violations of the Code of Conduct by directors or executive officers

 

LOGO  Reviewing and approving, as appropriate, related party transactions consistent with the guidelines set forth in the Code of Conduct and our related party transaction policy

 

LOGO  Appointing the members of the Retirement Administration and Investments Committee and overseeing the activities of such committee

 

LOGO  Reviewing and approving the independent auditors of our pension plans and reviewing the pension plans’ audit results

 

LOGO  Performing other functions or duties deemed appropriate by the Board

 

 

 

 

 

 

   

 

The J. M. Smucker Company       LOGO       2024 Proxy Statement      33  


BOARD AND COMMITTEE MEETINGS

 

   

 

Financial Literacy and Independence

 

The Audit Committee reviewed the financial literacy and independence of each of its members, as required by the listing standards of the NYSE, and determined that each of its members meets the criteria established by the NYSE. The Audit Committee also reviewed the definition of an “audit committee financial expert” as set forth in Regulation S-K and determined that two members, Jay Henderson and Jodi Taylor, satisfy the criteria for an independent audit committee financial expert. The Board adopted a resolution at its April 2024 meeting designating both members as an “audit committee financial expert” within the meaning of Regulation S-K.

 

Report

 

The Report of the Audit Committee is set forth on page 35 of this Proxy Statement.

 

 

 

34    The J. M. Smucker Company       LOGO       2024 Proxy Statement

 

   

 

 

 


REPORT OF THE AUDIT COMMITTEE

The Audit Committee Members

The Audit Committee is composed of three independent directors, each of whom satisfies the independence requirement of Rule 10A-3 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and the financial literacy criteria required by the listing standards of the NYSE. The Board has determined that two of our Audit Committee members, Jay Henderson and Jodi Taylor, satisfy the financial expertise requirements of the NYSE and have the requisite experience to be designated an “audit committee financial expert” as that term is defined by the rules of the SEC.

Roles and Responsibilities

The Audit Committee operates under a written charter adopted by the Audit Committee and approved by the Board. The charter was most recently amended in January 2024. The Audit Committee oversees our financial reporting process on behalf of the Board and serves as the primary communication link between the Board as the representative of our shareholders, the Independent Auditors (Ernst & Young LLP), and our internal auditors. Our management is responsible for the preparation, presentation, and integrity of our financial statements and for maintaining appropriate accounting and financial reporting policies and practices, and internal controls and procedures designed to assure compliance with accounting standards and applicable laws and regulations. The Independent Auditors are responsible for auditing our consolidated financial statements and expressing an opinion as to their conformity with generally accepted accounting principles and on the effectiveness of the Company’s internal controls over financial reporting in accordance with the requirements of the Public Company Accounting Oversight Board (the “PCAOB”).

Required Disclosures and Discussions

In fulfilling its responsibilities during the fiscal year, the Audit Committee reviewed and discussed with management and the Independent Auditors the financial statements and related financial statement disclosures included in our Quarterly Reports on Form 10-Q and the audited financial statements and related financial statement disclosures included in our Annual Report on Form 10-K for the fiscal year ended April 30, 2024. The Audit Committee also reviewed with the Independent Auditors their judgments as to the Company’s internal controls over financial reporting and the quality and acceptability of our accounting policies, management judgments, and accounting estimates. The Audit Committee’s review with the Independent Auditors included a discussion of other matters required to be discussed under Auditing Standards promulgated by the PCAOB. The Independent Auditors have provided the Audit Committee with the written disclosures required by the PCAOB standards regarding communications with the Audit Committee concerning independence and has discussed those disclosures with the Independent Auditors. The Audit Committee also considered the compatibility of non-audit services with the Independent Auditors’ independence and pre-approved all non-audit services to be provided by the Independent Auditors in accordance with the Audit Committee’s policies and procedures and applicable laws and regulations.

Committee Recommendation to Include Financial Statements in Annual Report

The Audit Committee discussed with our internal auditors and Independent Auditors the overall scope and plans for their respective audits. The Audit Committee met with the internal auditors and Independent Auditors, with and without management present, to discuss the results of the auditors’ examinations, their evaluations of our internal controls, including a review of the disclosure control process, and the overall quality of our financial reporting. In reliance on the reviews and discussions referred to above, the Audit Committee recommended to the Board that the audited financial statements be included in our Annual Report on Form 10-K for the fiscal year ended April 30, 2024.

AUDIT COMMITTEE

Jodi Taylor, Chair

Mercedes Abramo

Jay Henderson

 

 

 

 

   

 

The J. M. Smucker Company       LOGO       2024 Proxy Statement      35  


SERVICE FEES PAID TO THE INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

The following table summarizes the aggregate fees, including out of pocket expenses, paid to the Independent Auditors for the fiscal years ended April 30, 2024 and April 30, 2023:

 

    

2024 Fees

(in thousands)

   

2023 Fees

(in thousands)

         Description     
       

  Audit Fees

  $ 5,779     $ 4,061       

Audit fees consist of (i) the audit of our consolidated financial statements as of and for the fiscal years ended April 30, 2024 and April 30, 2023; (ii) the audit of the effectiveness of internal control over financial reporting in accordance with Section 404 of the Sarbanes-Oxley Act of 2002; and (iii) the reviews of our unaudited condensed consolidated interim financial statements as of July 31, October 31, and January 31 for fiscal years 2024 and 2023. Audit fees for fiscal year 2024 increased over fiscal year 2023 primarily due to the acquisition of Hostess Brands, Inc. (“Hostess Brands”) The total amount of audit fees for fiscal year 2023 decreased slightly after the filing of our 2023 Proxy Statement.

 

   
       

  Audit-Related

  Fees

  $ 346     $ 439       

Fees for services that are related to the performance of the audit or review of financial statements and are not included in “Audit Fees,” including financial reporting advisory services, acquisition-related due diligence, audits of financial statements of divested businesses, subscription to on-line research services, and other attest services. The decrease in audit-related fees in fiscal year 2024 was primarily attributable to the audit of the abbreviated financial statements of the divested pet foods business in fiscal year 2023, of which $225,000 was reimbursed to the Company by the buyer. The total amount of audit-related fees for fiscal year 2023 increased slightly after the filing of our 2023 Proxy Statement.

 

   
       

  Tax Fees

  $ 2,113     $ 958       

Tax fees are primarily for tax work in connection with strategic transactions and for tax compliance, preparation, and planning services. The increase in tax fees in fiscal year 2024 was primarily due to an increased amount of tax work for mergers and acquisitions tax advisory services and domestic tax advisory services during such fiscal year.

 

   
       

  All Other Fees

  $     $ 32       

Fees for services that are not included in the above categories. The all other fees in fiscal year 2023 relate to an internal audit assessment.

 

   

 

  TOTAL

 

 

 

$

 

 

 8,238

 

 

 

 

 

 

$

 

 

 5,490

 

 

 

 

          

AUDIT COMMITTEE PRE-APPROVAL POLICIES AND PROCEDURES

The Audit Committee charter, as well as the policies and procedures adopted by the Audit Committee, require that all audit and permitted non-audit services provided by the Independent Auditors be pre-approved by the Audit Committee. These services may include audit services, audit-related services, tax services and, in limited circumstances, other services. In determining whether to pre-approve any such services, the Audit Committee considers whether such services are consistent with the SEC’s and PCAOB’s rules on auditor independence and whether the provision of such services by an independent auditor would impair the independent auditor’s independence. The Audit Committee’s pre-approval identifies with particularity the type of service to be provided and the fixed amount or range of estimated fees. Such service descriptions contain sufficient detail so that management is not required to exercise discretion in interpreting the scope of the pre-approved service.

Should it be necessary to engage the Independent Auditors for additional services between scheduled Audit Committee meetings, the Chair of the Audit Committee has been delegated the authority to approve such permitted services up to $250,000 for a specific engagement. The Chair of the Audit Committee then reports such pre-approval at the next Audit Committee meeting. The approval policies and procedures of the Audit Committee do not include delegation of the Audit Committee’s responsibility to our management.

All services described above were pre-approved by the Audit Committee, or the Chair of the Audit Committee, before the Independent Auditors were engaged to render the services and in accordance with the approval policies and procedures adopted by the Audit Committee.

 

36    The J. M. Smucker Company       LOGO       2024 Proxy Statement

 

   

 

 

 


INDEPENDENT AUDITOR REVIEW AND APPOINTMENT PROCESS

The Audit Committee has the primary responsibility for the appointment, compensation, and oversight of the Independent Auditors and the approval and ratification of the lead audit partner selected by the Independent Auditors. The Audit Committee evaluates the performance of the Independent Auditors, including the senior audit engagement team members, each year and determines whether to re-engage the current Independent Auditors or consider other audit firms. The Audit Committee has implemented a formal written evaluation process to evaluate the performance of the current Independent Auditors. The evaluation includes, among other things:

 

  LOGO

A review of the audit planning process, the overall audit scope and plans, and the results of internal and external audit examinations;

 

 

  LOGO

The experience, knowledge, capabilities, technical expertise, and skills of the firm, engagement partner, and audit team and the quality and efficiency of the audit services provided;

 

 

  LOGO

The communications, interaction, and accessibility of the engagement partner and audit team with the Audit Committee and the Chair of the Audit Committee;

 

 

  LOGO

The independence, objectivity, integrity, and professional skepticism of the firm, engagement partner, and audit team;

 

 

  LOGO

The development and management of the audit budget and audit fees paid; and

 

 

  LOGO

Other questions related to the independence of the Independent Auditors and the ability of the Independent Auditors to remain independent.

 

Based on these evaluations, the Audit Committee decided that it was in the best interest of the Company and its shareholders to engage Ernst & Young LLP as our Independent Auditors for fiscal year 2025. Although the Audit Committee has the sole authority to appoint the Independent Auditors, the Audit Committee has continued its long-standing practice of recommending that the Board ask our shareholders to ratify the appointment of the Independent Auditors at our Annual Meeting of Shareholders.

BENEFITS OF A LONG-TENURED AUDITOR

The Audit Committee considered the tenure of the Independent Auditors and determined that a number of benefits of a long-tenured auditor exist, including:

 

  LOGO

Through more than 65 years of experience with the Company, the Independent Auditors have gained a deep understanding of the Company and its businesses, the industry in which it operates, accounting policies and practices, internal controls over financial reporting, and risks;

 

 

  LOGO

Efficiencies have been gained in the audit process, resulting in an efficient fee structure that is competitive with our peer companies; and

 

 

  LOGO

Appointing a new auditor would require a significant amount of management’s time for onboarding activities.

 

COMMUNICATIONS WITH THE AUDIT COMMITTEE

The Code of Conduct has established procedures for receiving confidential, anonymous complaints by employees and from third parties regarding accounting, internal accounting controls, or auditing matters. The Chief Ethics and Compliance Officer and Vice President, Internal Audit advise the Audit Committee regarding any reports or investigations related to accounting, internal accounting controls, or auditing matters. The Chair of the Audit Committee receives an automatic notification if a significant financial issue is reported. The Code of Conduct is posted on our website at www.jmsmucker.com.

 

 

 

 

   

 

The J. M. Smucker Company       LOGO       2024 Proxy Statement      37  


RATIFICATION OF APPOINTMENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

(Proposal 2 on the proxy card)

The Audit Committee is directly responsible for the appointment, compensation, retention, and oversight of the independent external audit firm retained to audit our financial statements. The Audit Committee has appointed Ernst & Young LLP as our independent external auditor for the fiscal year ending April 30, 2025. Ernst & Young LLP has served as our independent external auditor continuously since fiscal year 1955. The Audit Committee is responsible for the audit fee negotiations associated with the retention of Ernst & Young LLP. In order to ensure continuing auditor independence, the Audit Committee periodically considers whether there should be a regular rotation of the independent external audit firm. The members of the Audit Committee and the Board believe that the continued retention of Ernst & Young LLP to serve as our independent external auditor is in the best interests of our shareholders. The Audit Committee has requested that our shareholders ratify this decision.

A representative of Ernst & Young LLP will be present at the Annual Meeting with an opportunity to make a statement, if so desired, and to respond to appropriate questions with respect to that firm’s examination of our financial statements for the fiscal year ended April 30, 2024.

Although shareholder ratification is not required under the laws of the State of Ohio, we are submitting the appointment of Ernst & Young LLP to our shareholders for ratification at the Annual Meeting as a matter of good corporate practice and in order to provide a means by which shareholders may communicate their opinion to the Audit Committee. If our shareholders fail to vote on an advisory basis in favor of the selection, the Audit Committee will reconsider whether to retain Ernst & Young LLP and may retain that firm or another firm without re-submitting the matter to our shareholders. Even if our shareholders ratify the appointment, the Audit Committee may, in its discretion, direct the appointment of a different independent registered public accounting firm at any time during the year if it determines that such a change would be in the best interests of the Company and our shareholders.

The affirmative vote of the holders of a majority of the votes cast on this proposal, based upon one vote for each common share owned as of the record date, is necessary to ratify the appointment of Ernst & Young LLP as our Independent Registered Public Accounting Firm. Abstentions, broker non-votes, and shares not in attendance and not voted at the Annual Meeting will have no effect on the vote for this proposal. Unless otherwise directed, common shares represented by proxy will be voted “FOR” the approval of this proposal.

 

 

The Board unanimously recommends a vote FOR ratification of the

appointment of Ernst & Young LLP as our Independent Registered Public Accounting Firm.

 

 

 

38    The J. M. Smucker Company       LOGO       2024 Proxy Statement

 

   

 

 

 


ADVISORY VOTE ON EXECUTIVE COMPENSATION (“SAY-ON-PAY”)

(Proposal 3 on the proxy card)

The Dodd-Frank Wall Street Reform and Consumer Protection Act, enacted in 2010 (the “Dodd-Frank Act”), requires that we provide our shareholders with the opportunity to vote to approve, on a non-binding, advisory basis, the compensation of our Chief Executive Officer, Chief Financial Officer, and three other most highly compensated executive officers (collectively, the “Named Executive Officers”) as disclosed in this Proxy Statement in accordance with the compensation disclosure rules of the SEC under Section 14A of the Exchange Act. In 2023, our shareholders voted to conduct this advisory vote on an annual basis until at least 2029.

As described in detail under the heading “Compensation Discussion and Analysis,” we seek to closely align the interests of the Named Executive Officers with the interests of our shareholders. Our compensation programs are designed to reward the Named Executive Officers for the achievement of short-term and long-term strategic and operational goals and the creation of long-term shareholder value, while at the same time avoiding the encouragement of unnecessary or excessive risk-taking.

The vote on this resolution is not intended to address any specific element of compensation; rather, the vote relates to the compensation of the Named Executive Officers, as described in this Proxy Statement in accordance with the compensation disclosure rules of the SEC. The vote is advisory, which means that the vote is not binding on us, the Board, or the Compensation Committee. To the extent there is any significant vote against the Named Executive Officers’ compensation as disclosed in this Proxy Statement, the Board and the Compensation Committee will evaluate what actions, if any, may be necessary to address the concerns of our shareholders.

At our 2023 Annual Meeting, our executive compensation program received approval from approximately 95% of the votes cast. We believe that this result demonstrates our shareholders’ endorsement of the Compensation Committee’s executive compensation decisions and policies. Nonetheless, we have continued to make improvements to our incentive awards programs, as set forth in more detail below in the “Compensation Discussion and Analysis” section of this Proxy Statement.

The affirmative vote of the holders of a majority of the votes cast on this proposal, based upon one vote for each common share owned as of the record date, is necessary to approve, on an advisory basis, our executive compensation. Abstentions, broker non-votes, and shares not in attendance and not voted at the Annual Meeting will have no effect on the vote for this proposal. Unless otherwise directed, common shares represented by proxy will be voted “FOR” the approval of this proposal. Accordingly, we ask our shareholders to vote on the following resolution at our Annual Meeting:

“RESOLVED, that our shareholders approve, on an advisory basis, the compensation of our Named Executive Officers, as disclosed in our Proxy Statement for the 2024 Annual Meeting of Shareholders pursuant to Item 402 of Regulation S-K, including the Compensation Discussion and Analysis, the 2024 Summary Compensation Table, and the other related tables and disclosures.”

 

 

KEY COMPENSATION PRACTICES

 

 Performance-based pay makes up 74%—87% of Named Executive Officers’ target compensation

 

 Varied metrics for short-term and long-term incentive awards

 

 Expanded population being measured and rewarded on ESG metrics in annual incentive plan

 

 Robust stock ownership policy for executive officers

 

 Compensation practices do not encourage excessive risk taking

 

 Compensation consultant only provides services to Compensation Committee

 

 Use of tally sheets to approve Named Executive Officers’ compensation

 

 No tax gross-ups policy

 

 Clawback policy

 

 No hedging and no pledging policies

 

 

 

The Board unanimously recommends a vote FOR the approval of the compensation of our

Named Executive Officers, as disclosed in this Proxy Statement.

 

 

 

 

 

 

   

 

The J. M. Smucker Company       LOGO       2024 Proxy Statement      39  


EXECUTIVE COMPENSATION

Compensation Discussion and Analysis

The Compensation Committee regularly reviews our compensation philosophy and objectives. The Compensation Committee is also responsible for reviewing and approving compensation for our executive officers on an annual basis. A description of the Compensation Committee’s responsibilities is set forth in detail in its charter, which is posted on our website at www.jmsmucker.com. Our Named Executive Officers for fiscal year 2024 are listed below:

 

 

 Named Executive Officer

 

  

 

Title

 

   

 Mark Smucker

  

Chair of the Board, President, and Chief Executive Officer

   

 Tucker Marshall

  

Chief Financial Officer

   

 John Brase

  

Chief Operating Officer

   

 Jeannette Knudsen

  

Chief Legal Officer and Secretary

   

 Jill Penrose

  

Chief People and Company Services Officer

Set forth below is a detailed discussion of our compensation program for our executive officers organized as follows:

 

     Page  
COMPENSATION DISCUSSION AND ANALYSIS         

Executive Summary

     40  

Significant Compensation Practices and Recent Modifications

     43  

Components of Our Compensation Program for Executive Officers

     44  

Elements of Executive Officers’ Compensation for Fiscal Year 2024

     45  

Executive Officers’ Compensation for Fiscal Year 2025

     54  

Role of Our Outside Compensation Consultant

     55  

Determination of Compensation for Executive Officers

     56  

Health Benefits

     58  

Pension and Retirement Plans and the Non-Qualified Supplemental Retirement Plan

     59  

Other Benefits Executive Officers Receive

     61  

Description of Compensation Policies and Agreements with Executive Officers

     61  

Tax and Accounting Considerations

     63  

Compensation-Related Risk Assessment

     63  

Executive Summary

We manage our business with the long-term objective of providing value to all of our constituents — namely, consumers, customers, employees, suppliers, communities in which we have a presence, and shareholders. Our compensation philosophy is that compensation for employees, including our executive officers, should be:

 

  LOGO

Predominantly performance-based;

 

  LOGO

Fair and equitable when viewed both internally and externally; and

 

  LOGO

Competitive in order to attract, reward, and retain the best qualified individuals.

We have designed our compensation programs to reflect each of these characteristics. The performance-based incentives (comprised of corporate performance, and in some cases, individual performance, strategic business area performance, and progress on ESG objectives) seek to reward both short-term and long-term results and to align the interests of our executive officers and other participants with the interests of our shareholders. Our executive officers receive a compensation package that primarily consists of an annual base salary, short-term incentive awards, and long-term incentive awards.

 

40    The J. M. Smucker Company       LOGO       2024 Proxy Statement

 

   

 

 

 


EXECUTIVE COMPENSATION

 

In fiscal year 2024, all executive officers, including the Named Executive Officers, had annual cash incentive awards based on the achievement of our annual performance targets for adjusted operating income, net sales, and ESG objectives. Such awards for executive officers in fiscal year 2024 were based 70% on the achievement of the adjusted operating income target, 20% on the achievement of the net sales target, and 10% on the achievement of the ESG objectives, which were focused on our inclusion, diversity, and equity efforts.

The Compensation Committee generally sets performance targets for participants, including executive officers, in June of each year for the fiscal year commencing the prior May 1st. We believe that the performance targets established by the Compensation Committee for both our short-term and long-term incentive awards for fiscal year 2024, including adjusted operating income, net sales, ESG, adjusted earnings per share, return on invested capital, and, in some cases, strategic business area performance, required participants, including executive officers, to perform at a high level.

Fiscal Year 2024 Financial Performance

The chart below summarizes our key financial results for fiscal year 2024 compared to fiscal year 2023. Our fiscal year 2024 performance was delivered amid a continued challenging business environment, including cost inflation and supply chain disruptions, and also reflects the financial impact of businesses acquired and divested in fiscal years 2024 and 2023. The strong results we achieved this year were thanks to the hard work of our dedicated employees, the strength of our strategy, and the continued momentum of our brands. The successful balance in operating efficiently while investing in the growth of our brands allowed us to realize financial results meeting or exceeding expectations.

 

 

Dollars in millions, except per share data

   Fiscal 2024      Fiscal 2023      Change (%)   
   

Net Sales*

  

$

8,178.7

 

  

$

8,529.2

 

  

 

(4)%

 

   

Adjusted Operating Income*

  

$

1,636.2

 

  

$

1,415.4

 

  

 

16%

 

   

Adjusted Earnings Per Share*

  

$

9.94

 

  

$

8.92

 

  

 

11%

 

   

Free Cash Flow*

  

$

642.9

 

  

$

717.0

 

  

 

(10)%

 

   

Fiscal Year End Stock Price

  

$

114.85

 

  

$

154.41

 

  

 

(26)%

 

 

  *

Adjusted operating income and adjusted earnings per share exclude certain items affecting comparability that can significantly affect the year-over-year assessment of operating results, which include amortization expense and impairment charges related to intangible assets, certain divestiture, acquisition, integration, and restructuring costs, gains and losses on divestitures, the net change in cumulative unallocated derivative gains and losses on commodity and foreign currency exchange derivative activities, and other infrequently occurring items that do not directly reflect ongoing operating results. Income taxes, as adjusted is calculated using an adjusted effective income tax rate that is applied to adjusted income before income taxes and reflects the exclusion of the previously discussed items, as well as any adjustments for one-time tax related activities, when they occur. While this adjusted effective income tax rate does not generally differ materially from our GAAP effective income tax rate, certain exclusions from non-GAAP results, such as unfavorable tax impacts associated with the acquisition of Hostess Brands, in fiscal year 2024 and an unfavorable permanent impact of the divestiture of certain pet food brands to Post Holdings, Inc. during fiscal year 2023, can significantly impact our adjusted effective income tax rate.

 

 

 

 

 

 

   

 

The J. M. Smucker Company       LOGO       2024 Proxy Statement      41  


EXECUTIVE COMPENSATION

 

Generally, net sales, adjusted operating income, and adjusted earnings per share are calculated as defined for incentive compensation purposes, but, as permitted by the plan, may be modified to exclude other items as determined by the Compensation Committee to adjust for any undue benefit or unintended detriment as a result of significant unplanned one-time items. Fiscal year 2024 and 2023 financial results have not been modified, but the Compensation Committee did modify the adjusted operating income and net sales targets for fiscal year 2024 to exclude the portion of the targets related to the divested Sahale Snacks® and Canada condiment businesses for the months subsequent to the divestitures. In addition, due to the acquisition of Hostess Brands on November 7, 2023, the fiscal year 2024 adjusted operating income and net sales targets were also modified to include the operating income and net sales projections for the months we owned Hostess Brands. Further, the Compensation Committee adjusted the fiscal year 2024 net sales target to reflect the impact of contract manufacturing sales related to the divestiture of certain pet food brands to Post Holdings, Inc. on April 28, 2023. The targets for fiscal year 2023 were not modified for the divestiture of certain pet food brands, as the divestiture did not have a material impact to the fiscal year 2023 operating results.

For a reconciliation of adjusted operating income, adjusted earnings per share, and free cash flow for fiscal years 2024 and 2023, see Appendix A. For additional information on how we calculate adjusted operating income, adjusted earnings per share, and free cash flow, see Management’s Discussion and Analysis of Financial Condition and Results of Operations in our Annual Report on Form 10-K, which can be found on our website at investors.jmsmucker.com.

Our fiscal year 2024 performance was one of the key factors in the compensation decisions for the fiscal year, as more specifically discussed below.

2023 Say-On-Pay Advisory Vote Outcome

At our 2023 Annual Meeting, our executive compensation program received approval from approximately 95% of the votes cast. We believe that this result demonstrates our shareholders’ endorsement of the Compensation Committee’s executive compensation decisions and policies. This shareholder vote was one of many factors contributing to the Compensation Committee’s decision not to make significant changes to our compensation mix, peer group, or target pay levels. Nonetheless, we have continued to make improvements to our incentive awards programs, as set forth in this “Compensation Discussion and Analysis” section of this Proxy Statement. The Compensation Committee will continue to consider results from future shareholder advisory votes, which will continue to be held annually unless shareholders select a different frequency of future votes on executive compensation, in its ongoing evaluation of our executive compensation programs and practices.

 

 

42    The J. M. Smucker Company       LOGO       2024 Proxy Statement

 

   

 

 

 


EXECUTIVE COMPENSATION

 

Significant Compensation Practices and Recent Modifications

Our compensation programs, practices, and policies are reviewed and reevaluated on an ongoing basis. We modify our compensation programs and practices to address evolving best practices and changing regulatory requirements. Listed below are some of our more significant practices and recent modifications.

 

   

 

Practices

 

  

 

Recent Modifications

 

   

Performance-Based Pay

  

As discussed above, we abide by a strong pay for performance philosophy. For fiscal year 2024, 74% to 87% of the target principal compensation components for the Named Executive Officers were variable and tied to financial and strategic performance.

   

No Tax Gross-Ups Policy

  

We have a Payment of Tax Gross-Ups Policy that prohibits tax gross-up payments to our executive officers.

   

Significant Stock Ownership

  

The minimum stock ownership requirement for our Chief Executive Officer is a multiple of six times his annual base salary. Our other executive officers must own stock with a value of at least two times their annual base salaries. All of the Named Executive Officers exceed the minimum stock ownership guidelines, thereby strongly aligning each Named Executive Officer’s long-term interests with our shareholders.

   

Clawback Policy

  

During fiscal year 2024, we adopted an amended Clawback of Incentive Compensation Policy (the “Clawback Policy”), which (i) serves as the clawback policy that we were required to adopt pursuant to the applicable NYSE regulations (the “Required Clawback Policy”), and (ii) provides a framework for the Compensation Committee to enforce recoupments or clawbacks of performance and/or time-based compensation in the event of certain detrimental activity (the “Broad-Based Clawback Policy”). Under the Required Clawback Policy, the Compensation Committee must recoup certain excess incentive-based compensation from current and former Section 16 officers of the Company as a result of certain accounting restatements under circumstances required under the applicable NYSE regulations. Under the Broad-Based Clawback Policy, which applies to a broader group of employees than the Required Clawback Policy, the Compensation Committee has the ability to recoup certain time and/or performance-based compensation in the event that a covered employee engages in detrimental activity that is harmful to the Company.

   
Compensation Risk Assessment   

With input from Semler Brossy, the Compensation Committee’s independent compensation consultant, we conducted a compensation risk assessment and concluded that our compensation policies and practices do not encourage excessive or unnecessary risk-taking and are not likely to have a material adverse effect on the Company.

   

Independent Compensation

Committee

  

Each member of the Compensation Committee is independent as defined in the corporate governance listing standards of the NYSE and our director independence standards.

   
Outside Compensation Consultant   

The Compensation Committee utilizes the services of Semler Brossy, an independent compensation consultant, which performs services solely in support of the Compensation Committee.

   

No Hedging Policy

  

We have a “no hedging” policy that prohibits directors, executive officers, and employees from engaging in hedging transactions in our common shares or from purchasing our common shares “on margin.”

   

No Pledging Policy

  

We have a “no pledging” policy that prohibits directors, executive officers, and employees from pledging any common shares as collateral for a margin loan or otherwise.

   

Use of Tally Sheets

  

The Compensation Committee annually reviews a tally sheet for each Named Executive Officer to inform total compensation decisions.

   

Double Trigger Change in  Control Provision in Long-Term  Incentive Award Agreements

  

Beginning with long-term incentive awards made in June 2022 for fiscal year 2023, our incentive award agreements include a double-trigger change in control provision, pursuant to which such awards will immediately vest only if we have a change in control and the participant’s employment is terminated without cause or the participant resigns for good reason.

 

 

 

 

 

 

   

 

The J. M. Smucker Company       LOGO       2024 Proxy Statement      43  


EXECUTIVE COMPENSATION

 

Components of Our Compensation Program for Executive Officers

Our executive officers receive a compensation package which consists of the following components:

 

   

Components

 

  

Description

 

   

Cash

  

LOGO   Annual base salary;

 

LOGO   Annual holiday bonus equal to 2% of annual base salary, which is provided to all of our salaried and hourly non-represented employees;

 

LOGO   Short-term incentive compensation program, in the form of a potential annual cash award (“Cash Incentive Award”), which provides participants the opportunity, subject to meeting specified goals, to earn an annual cash bonus; and

 

LOGO   Periodically, additional cash awards for unusual circumstances.

 

 

   

Equity

  

LOGO   Our long-term incentive compensation program provides participants the opportunity to earn three separate long-term incentive equity awards, consisting of performance units that will vest at the end of three years subject to meeting specified three-year performance goals and restricted stock awards and stock options that will ratably vest in equal tranches over such three-year period;

 

LOGO   In order to promote the retention of elected officers and align the compensation of elected officers with our long-term success, the Compensation Committee awards newly elected officers 2,000 shares of restricted stock upon election. Such awards cliff vest five years from the grant date but would be accelerated in the event of a change in control or the death or permanent disability of the elected officer; and

 

LOGO   Periodically, and under very particular circumstances, additional equity awards in the form of performance or time-based options or restricted stock.

 

 

   

Health and

Retirement

Benefits

  

LOGO   Participation in health and welfare plans upon substantially the same terms as available to most of our other salaried employees;

 

LOGO   Participation in qualified and nonqualified retirement plans (such as a 401(k) plan and The J. M. Smucker Company Restoration Plan (the “Restoration Plan”)) upon substantially the same terms as available to most of our other similarly situated employees;

 

LOGO   Participation in one of two executive retirement plans, both of which have been closed to new participants (one of which was frozen for current participants on December 31, 2017 and the other of which was frozen for current participants on July 1, 2023); and

 

LOGO   Periodic physical examinations upon the same terms as available to all of our employees at or above the Senior Director level.

 

 

   

Other Benefits

  

LOGO   Selected perquisites for certain executive officers, such as use of our aircraft (primarily by the Chief Executive Officer for fiscal year 2024), financial and tax planning assistance, tickets to entertainment events, up to $7,500 in charitable matching gifts under our matching gift program, and a nominal flexible perquisite intended to be used for health, wellness, social, or travel club dues and expenses.

 

 

 

44    The J. M. Smucker Company       LOGO       2024 Proxy Statement

 

   

 

 

 


EXECUTIVE COMPENSATION

 

Elements of Executive Officers’ Compensation for Fiscal Year 2024

Target Pay Mix Summary

 

 

Target Pay Mix-CEO    Target Pay Mix-NEOs

 

LOGO

  

 

LOGO

Annual Base Salary

Salary ranges are determined in the same manner for each of our salaried employees, including each executive officer. The base salaries paid to all employees, including each executive officer, are intended to fall within an established range based on market practice. Actual pay within the range reflects the experience of the executive officer, his or her performance, and the scope of his or her responsibility.

Short-Term Incentive Awards (Cash-Based)

Our short-term, performance-based incentive compensation program is cash-based and is designed to reward key employees, including executive officers, for their contributions to the Company based on clear, measurable criteria. After the end of each fiscal year, the Compensation Committee reviews management’s recommendations for Cash Incentive Awards for executive officers (other than for the Chief Executive Officer for whom management makes no recommendation). The Compensation Committee evaluates the following criteria and information when approving the short-term incentive awards for executive officers:

 

  LOGO

Our performance in relation to our adjusted operating income, which is calculated as set forth on pages 41-42;

 

 

  LOGO

Our top-line performance in relation to our net sales, which is calculated as set forth on pages 41-42;

 

 

  LOGO

Our performance in relation to our ESG objectives for such fiscal year; and

 

 

  LOGO

In general, if an executive officer has responsibilities that include oversight of a strategic business area, a significant percentage of this short-term incentive award is tied to that strategic business area’s performance in relation to its annual net sales and segment profit goal, and the Compensation Committee reviews attainment of relevant goals for those areas each year.

 

All executive officers, including the Named Executive Officers, had their annual cash incentive awards for fiscal year 2024 based on the achievement of our annual performance targets for adjusted operating income and net sales, as well as ESG objectives. Such awards for executive officers were based 70% on the achievement of the adjusted operating income target, 20% on the achievement of the net sales target, and 10% based on the achievement of the ESG objectives, which were focused on our inclusion, diversity, and equity efforts.

The adjusted operating income portion of the short-term incentive awards can range from 0% of the target award amount if we fail to achieve at least 90% of our adjusted operating income goal, to a maximum of 200% of the target award amount if we achieve or exceed 110% of our adjusted operating income goal. The net sales portion of the short-term

 

 

 

 

 

   

 

The J. M. Smucker Company       LOGO       2024 Proxy Statement      45  


EXECUTIVE COMPENSATION

 

incentive awards can range from 0% of the target award amount if we fail to achieve at least 98% of our net sales goal, to a maximum of 200% of the target award amount if we achieve or exceed 103% of our net sales goal. Finally, the ESG portion of the short-term incentive awards will be paid out at 0% or 100%, as determined by the Compensation Committee, based on the Company’s achievement of its qualitative ESG objectives, which included the following for fiscal year 2024: (i) fostering an inclusive and equitable workplace; (ii) aspiring to increase people of color at every level and women in leadership; and (iii) sharing our efforts with our external communities and customers.

Participants in the short-term incentive compensation program receive a percentage of their target award based on our performance as shown in the following table. No awards are made unless we achieve at least 90% of our adjusted operating income goal, and no awards are made with respect to the net sales portion of the award unless we achieve at least 98% of our net sales goal.

 

Ranges   

Percentage of

Target

Award
Earned

  

Net Sales

Performance

Level
Achieved

  

AOI

Performance

Level
Achieved

  

ESG

Performance

Level
Achieved (1)

Below Threshold

  

  0%

  

<98%

  

<90%

  

  0%

Threshold

  

 25%

  

 98%

  

 90%

  

  —

Target

  

100%

  

100%

  

100%

  

100%

Maximum (2)

  

190%

  

103%

  

110%

  

  —

 

   (1)

The ESG portion of the short-term incentive awards for executive officers will be paid out at 0% or 100%, as determined by the Compensation Committee.

 
   (2)

The maximum payout for the adjusted operating income and net sales targets is 200%, and the maximum payout for the ESG objectives is 100%. Therefore, the combined maximum payout for the executive officers is 190%.

 

In the event net sales or adjusted operating income performance is between the ranges set forth in the table above, the Compensation Committee determines the percentage of the award that is earned by mathematical interpolation for each such range.

Finally, the ESG portion of the short-term incentive awards for executive officers will be paid out at 0% or 100%, as determined by the Compensation Committee, based on the Company’s achievement of its qualitative ESG objectives, which are set forth below for fiscal year 2024. Our progress made toward each of these objectives is detailed in the “FY24 ESG Accomplishments” table on page 49. For the Named Executive Officers, the target award is tied solely to the corporate adjusted operating income and net sales performance targets, in addition to the ESG objectives. Individual performance is not a factor in determining Cash Incentive Awards for the Named Executive Officers. The Compensation Committee, however, does have discretion to reduce a Named Executive Officer’s award but did not do so in fiscal year 2024.

Incentive target awards for executive officers under the short-term incentive compensation program are also approved by the Compensation Committee and are represented as a percentage of each executive officer’s base salary. The target award percentage for each executive officer is reviewed regularly by the Compensation Committee with input from Semler Brossy. Named Executive Officers’ target awards ranged from 80% to 150% of base salary depending on the responsibilities and experience of the Named Executive Officer. For fiscal year 2024, the most a Named Executive Officer was eligible to receive in such fiscal year was 190% of the target award (i.e., between 152% and 285% of base salary).

 

 

46    The J. M. Smucker Company       LOGO       2024 Proxy Statement

 

   

 

 

 


EXECUTIVE COMPENSATION

 

Set forth below is an example of the calculation of a Cash Incentive Award for an executive officer with corporate responsibilities:

Example: An executive officer with corporate responsibilities, an annual base salary equal to incurred earnings of $200,000, and a Cash Incentive Award target award of 50% of base salary would receive the following Cash Incentive Award based on achievement of performance levels for all categories as shown below:

 

         
        

Threshold

(25%)

   

Target

(100%)

   

Maximum

(190%) (1)

 
               
Weight       

Performance

Level

Achieved

   

Cash

Incentive

Award

Earned ($)

   

Performance

Level

Achieved

 

Cash

Incentive

Award

Earned ($)

   

Performance

Level
Achieved

   

Cash
Incentive
Award

Earned ($)

 

Adjusted Operating Income

 

70%

 

 

90%

 

 

$

17,500 

 

100%

 

$

70,000 

 

 

110

 

$

140,000 

Net Sales

 

20%

 

 

98%

 

 

$

5,000 

 

100%

 

$

20,000 

 

 

103

 

$

40,000 

ESG (2)

 

10%

 

 

<100%

 

 

$

0 

 

100%

 

$

10,000 

 

 

>100

 

$

10,000 

Total

 

100%

         

$

22,500 

     

$

100,000 

         

$

190,000 

 

   (1)

The maximum payout for the adjusted operating income and net sales targets is 200%, and the maximum payout for the ESG objectives is 100%. Therefore, the combined maximum payout for the executive officers is 190%.

 
   (2)

The ESG portion of the short-term incentive awards for executive officers will be paid out at 0% or 100%, as determined by the Compensation Committee.

 

The short-term incentive compensation program corporate performance goals for fiscal year 2024 were as shown in the following table:

Short-Term Incentive Compensation Program

Corporate Performance Goals for

Fiscal Year 2024

 

       
Ranges   

Performance Level Achieved

(Adjusted Operating Income) (in Millions)

  

Performance Level Achieved

(Net Sales) (in Millions)

  

Percentage of Cash 

Incentive Award 

Opportunity Earned 

       

Below Threshold

  

Below $1,286.0 (90% of Target)

   Below $7,499.4 (98% of Target)      0%
       

Threshold

  

$1,286.0 (90% of Target)

   $7,499.4 (98% of Target)     25%
       

Target

   $1,428.9    $7,652.4    100%
       

Maximum

  

$1,571.8 (110% of Target)

   $7,882.0 (103% of Target)    200%

We believe that the performance targets established by the Compensation Committee for fiscal year 2024 required participants, including executive officers, to perform at a high level in order to achieve the target performance levels. During the five-year period from fiscal year 2020 through fiscal year 2024, we achieved performance above the target level but below the maximum level four times and below the target level but above the threshold level one time. Generally, the Compensation Committee sets the minimum, target, and maximum levels such that the relative difficulty of achieving the target level is consistent from year to year.

 

 

 

 

 

   

 

The J. M. Smucker Company       LOGO       2024 Proxy Statement      47  


EXECUTIVE COMPENSATION

 

The short-term incentive targets for the Named Executive Officers for fiscal years 2023 and 2024 are set forth in the following table:

Short-Term Incentive Targets

(As a Percentage of Base Salary)

 

 

LOGO

Specifically, with respect to fiscal year 2024, the Compensation Committee approved the target corporate adjusted operating income goal of $1,428.9 million and the target corporate net sales goal of $7,652.4 million in June 2023. In light of the financial impacts of our acquisition of Hostess Brands, the divestitures of the Sahale Snacks and Canada condiment businesses, and the contract manufacturing sales related to the divestiture of certain pet food brands, the Compensation Committee modified the target corporate adjusted operating income goal to $1,538.8 million and the target corporate net sales goal to $8,211.0 million to include the operating income and net sales targets of the acquired business for the months that we owned such business and to exclude the operating income and net sales targets of the divested businesses for the months that we did not own such businesses during fiscal year 2024, as permitted by our plan. We achieved adjusted operating income of $1,636.2 million, representing 106% of the target amount, and net sales of $8,178.7 million, representing 99.5% of the target amount. Finally, with respect to the ESG portion of the short-term incentive awards, the table below sets forth our accomplishments for each ESG objective noted above for fiscal year 2024. In light of these achievements, the Compensation Committee determined that the executive officers satisfied the qualitative ESG objectives, and, therefore, that portion of the award paid out at 100% of the target amount.

 

 

48    The J. M. Smucker Company       LOGO       2024 Proxy Statement

 

   

 

 

 


EXECUTIVE COMPENSATION

 

   

 ESG Objectives

 

  

FY24 Accomplishments

 

   

Foster an Inclusive and

Equitable Workplace

  

LOGO   Expanded education offerings for all People Managers through the design of a new leadership program, “Leading Inclusively at Smucker.”

 

LOGO   Ensured leaders of all Business Resource Groups (“BRG”) have a dedicated performance objective for alignment and recognition of time required of this work.

 

LOGO   Provided leadership development opportunities for BRG leaders and enhanced executive sponsor support.

 

LOGO   Continued to raise awareness of our inclusion, diversity, and equity efforts through our monthly Reasons to Celebrate and Conversations that Elevate programs.

 

LOGO   Piloted several external leadership development programs through Company sponsored participation of several people of color and females.

 

LOGO   Curated and provided employee learning day – “Thrive Together Through Inclusion.”

 

   
Aspire to Increase Workforce Diversity by 2027   

LOGO   Achieved annual progress aspirations in representation of people of color and females in leadership positions; on-track to longer-term aspirations.

 

LOGO   Implemented enhanced talent acquisition practices in conjunction with required People Manager education to expand diversity of candidate pools, and talent sources.

 

LOGO   Established multiple new recruiting partnerships with sources of underrepresented segments of our workforce.

 

LOGO   Provided expanded education opportunities and resources for Hiring Managers to promote unbiased and objective hiring practices.

 

   

Share Our Efforts with Our

External Communities and

Consumers

  

LOGO   Continued focus on diverse selection considerations across many external partnerships, including selection of talent in our advertising campaigns, supplier diversity, scholarship recipients, and charitable giving beneficiaries.

 

LOGO   Published an Employer Information Report (EEO-1) to provide greater transparency on the diversity of our current workforce.

 

LOGO   Continued support of our Annual Charitable Giving Campaign to organizations that support underrepresented talent and expanded volunteerism platform to meet employee interest for greater participation opportunities.

 

LOGO   Continued to participate in the annual Corporate Equality Index Human Rights Campaign survey to demonstrate support for members of the LGBTQ+ community; achieved perfect score in 2023.

 

As a result of exceeding the adjusted operating income and net sales targets, and achieving the ESG objectives, the corporate performance portion of the awards paid at 138.3% of the target for the executive officers.

 

 

 

 

 

   

 

The J. M. Smucker Company       LOGO       2024 Proxy Statement      49  


EXECUTIVE COMPENSATION

 

Set forth below is an example of the calculation of a Cash Incentive Award for an executive officer with corporate responsibilities:

Example: An executive officer with corporate responsibilities, an annual base salary equal to incurred earnings of $200,000, and a Cash Incentive Award target award of 50% of base salary would receive the following Cash Incentive Award based on fiscal year 2024 achievement of performance levels for all categories as shown below:

 

                   
Metric   

Total

Target

   X      Weighting    =     

Target

Award

   

Performance

to Plan

   

Payout %

of Target

    =   

Award

Payout

 
             

Adjusted Operating Income

   $100,000    X      70%    =      $ 70,000       106     160   =    $ 112,000  
             

Net Sales

   $100,000    X      20%    =      $ 20,000       99.5     81.3   =    $ 16,260  
             

ESG

   $100,000    X      10%    =      $ 10,000       100     100   =    $ 10,000  
   
                         $ 100,000                          $ 138,260  

Long-Term Incentive Awards (Stock-Based)

Our long-term, performance-based compensation is stock-based and designed to align the interests of management with the interests of our shareholders.

 

 

LOGO

Equity awards are currently issued under the 2020 Plan for our long-term incentive compensation program. For fiscal year 2024, executive officer participants received three separate long-term incentive awards.

 

 

50    The J. M. Smucker Company       LOGO       2024 Proxy Statement

 

   

 

 

 


EXECUTIVE COMPENSATION

 

The first award consists of performance units that will generally vest at the end of three years and are based 75% on the achievement of our three-year performance target for adjusted earnings per share and 25% on the achievement of our three-year performance target for return on invested capital, as established by the Compensation Committee at the beginning of the three-year period. Awards only vest if we achieve at least 90% of our adjusted earnings per share target. Performance units earn dividend equivalents (paid in cash) equal to regular dividends paid on our common stock over the three-year performance period, which are distributed only to the extent the underlying units vest. The following table summarizes the actual performance units which vest at various achievement levels.

 

  Ranges

   Achievement of Target   

Performance

  Percentage of Target  

Award Earned

 Below Threshold

<90%    0% 

 Threshold

 90%   50% 

 Target

100%  100% 

 Maximum

115%  200% 

In the event performance is between the ranges set forth in the table above, the Compensation Committee determines the percentage of the performance units that are earned by mathematical interpolation for each such range.

The second award consists of restricted stock that are not performance based and will generally ratably vest in equal tranches over a three-year period. Unvested restricted stock awards do not earn dividends or dividend equivalents.

The third award consists of stock options (which further align our executive officers with shareholders by creating value through share price appreciation) and will generally ratably vest in equal tranches over a three-year period. For fiscal year 2024, the executive officers, including all of the Named Executive Officers, received 60% of their long-term incentive award in performance units, 20% in restricted stock, and 20% in stock options.

The other essential features of the equity awards are as follows:

 

  LOGO

Subject to Compensation Committee approval for elected officers and authorized executive officer approval for other participants, grants of equity awards are generally made each June;

 

 

  LOGO

Equity awards that a participant is eligible to receive are computed based on a participant’s base salary and long-term incentive target at the time of the grant of the award for the fiscal year in which the equity award is being measured;

 

 

  LOGO

In order to receive an equity award, participants must be employed by the Company at the time of the grant;

 

 

  LOGO

Upon participants reaching the age of 60 with at least 10 years of service (or the age of 60 with at least five years of service for John Brase), all restricted stock vests on the later of the first anniversary of the grant date and the date that the participant meets such age and service requirements, and all stock options vest when the participant retires from the Company after reaching such age and service requirements so long as such date is after the first anniversary of the grant date;

 

 

  LOGO

If a participant retires from the Company upon reaching the age of 60 with at least 10 years of service (or the age of 60 with at least five years of service for John Brase) and such retirement

 

 

 

 

 

 

   

 

The J. M. Smucker Company       LOGO       2024 Proxy Statement      51  


EXECUTIVE COMPENSATION

 

 

occurs after the first anniversary of the beginning of the performance period, the participant vests in the total number of the performance units that become “vesting eligible units” (based on actual performance at the end of the three-year period);

 

 

  LOGO

If a participant leaves the Company following two years after the grant date under circumstances determined by the Compensation Committee to be for the convenience of the Company, the remaining stock options and restricted stock from that grant vest immediately;

 

 

  LOGO

If a participant leaves the Company following the first anniversary of the beginning of the performance period under circumstances determined by the Compensation Committee to be for the convenience of the Company, the participant vests in such number of performance units that become “vesting eligible units” (based on actual performance at the end of the three-year period) multiplied by a fraction, the numerator of which is the number of months from the beginning of the performance period through the termination of employment, and the denominator of which is 36;

 

 

  LOGO

Upon the occurrence of a change in control, all of the stock options and restricted stock granted during or prior to fiscal year 2022 vest immediately, and the performance units granted during or prior to fiscal year 2022 vest at the target number of units upon the consummation of the change in control;

 

 

  LOGO

A double-trigger change in control provision was added for all awards granted during or after fiscal year 2023, pursuant to which such awards will immediately vest if we have a change in control and the participant’s employment is terminated without cause or the participant resigns for good reason;

 

 

  LOGO

If a participant dies or his or her employment with the Company is terminated due to a disability, all of the stock options and restricted stock vest immediately, and the performance units vest at the target number of units multiplied by a fraction, the numerator of which is the number of months from the beginning of the performance period through the participant’s death or termination for disability, and the denominator of which is 36;

 

 

  LOGO

Unvested equity awards are generally forfeited upon an employee’s voluntary departure from the Company; and

 

 

  LOGO

The equity awards include restrictive covenants, including confidentiality obligations and non-solicit, non-interference, and non-competition covenants. In addition to other remedies which may be available, violations of those covenants may result in forfeiture of any awards and repayment of any proceeds from any awards.

 

Management makes no recommendation regarding long-term incentive awards for the Chief Executive Officer. However, the Compensation Committee, after considering input from Semler Brossy regarding the external market and other factors, makes grants to the Chief Executive Officer based on the same performance standards as used for the other participants.

 

 

52    The J. M. Smucker Company       LOGO       2024 Proxy Statement

 

   

 

 

 


EXECUTIVE COMPENSATION

 

The long-term incentive targets for the Named Executive Officers for fiscal years 2023 and 2024 are set forth in the following table:

Long-Term Incentive Targets

(As a Percentage of Base Salary)

 

 

LOGO

Long-term incentive targets were increased for certain Named Executive Officers to ensure they are competitive with peers in similar roles and aligned with our long-term business objectives and the interests of our shareholders.

Long-Term Award Snapshot (Stock Based)

 

 

LOGO

 

 

 

 

 

   

 

The J. M. Smucker Company       LOGO       2024 Proxy Statement      53  


EXECUTIVE COMPENSATION

 

Long-Term Incentive Awards — Three-Year Performance Period Ending Fiscal Year 2024

For the fiscal year 2022 performance units that were granted in June 2021 and to be settled in June 2024 based on the performance of the Company for the three fiscal year period commencing May 1, 2021 and ending April 30, 2024, the Compensation Committee approved the target corporate adjusted earnings per share goal of $10.00 and the target corporate return on invested capital goal of 7.25%. Specifically, with respect to the three fiscal year period commencing May 1, 2021 and ending April 30, 2024, we achieved adjusted earnings per share of $9.94, representing 99% of the target amount, and return on invested capital of 6.30%, representing 87% of the target amount. Since we exceeded the threshold of the adjusted earnings per share goal (providing for a payout of 97.5%) but not the return on invested capital goal (providing for no payout), 73.13% of the performance units granted in June 2021 vested in June 2024.

Long-Term Awards – Three-Year Performance Period Ending Fiscal Year 2024

 

 

LOGO

The three-year performance periods for the grants of performance units in fiscal years 2023 and 2024 will be determined following fiscal years 2025 and 2026, respectively, so no performance units for such grants were earned by the Named Executive Officers for fiscal year 2024.

Executive Officers’ Compensation for Fiscal Year 2025

For fiscal year 2025, the Compensation Committee has elected to freeze the base salary for all of our executive officers in support of the Company’s transformation initiatives and integration of the Hostess Brands’ business. In addition, all executive officers will continue to have annual cash incentive awards based on the achievement of our annual performance targets for adjusted operating income and net sales, as well as ESG objectives. Such awards for executive officers will continue to be based 70% on the achievement of the adjusted operating income target, 20% on the achievement of the net sales target, and 10% based on the achievement of expanded ESG objectives, which will continue to be focused on our inclusion, diversity, and equity objectives. For future fiscal years, the Compensation Committee will continue to evaluate ESG objectives for both the short-term and long-term incentive compensation programs.

 

 

54    The J. M. Smucker Company       LOGO       2024 Proxy Statement

 

   

 

 

 


EXECUTIVE COMPENSATION

 

In connection with our ongoing efforts to assess our peer group and align our compensation program with competitive market practices, the Compensation Committee recently approved the following changes to our long-term incentive compensation program and our executive severance plan for fiscal year 2025. For fiscal year 2024, all executive officers, including the Named Executive Officers, received 60% of their long-term incentive award in performance units, 20% in restricted stock, and 20% in stock options. Beginning with awards made in June 2024 for fiscal year 2025 performance, all executive officers, including the Named Executive Officers, will receive 60% of their long-term incentive award in performance units and 40% in restricted stock, and the Compensation Committee will determine the performance metrics and targets for the 2025 performance units at its meeting in August 2024. In addition, beginning with long-term incentive awards made in June 2024 for fiscal year 2025, the definition of retirement eligibility in our incentive award agreements was amended, pursuant to which such awards will vest if the grantee retires from the Company upon reaching (i) the age of 60 or older with at least five years of service with the Company or (ii) the age of 55 or older with at least 10 years of service with the Company, and such retirement occurs after the first anniversary of the beginning of the performance period for performance units or the first anniversary of the grant date for restricted stock.

In addition, commencing May 1, 2024, we amended The J. M. Smucker Company Executive Severance Plan (the “Severance Plan”), which provides for the payment of severance and other benefits in the event of a termination of employment with the Company without cause (as defined in the Severance Plan) or for certain other specified reasons (each, a “Qualifying Termination”). In the event of a Qualifying Termination, the new Severance Plan provides the following payments and benefits to elected officers for fiscal year 2025:

 

  LOGO

Severance in an amount equal to 18 months of the elected officer’s base monthly salary in effect immediately prior to the date of the Qualifying Termination, with the exception of the Chief Executive Officer, who will receive 24 months of his or her base monthly salary in effect immediately prior to the date of the Qualifying Termination; and

 

 

  LOGO

An additional lump sum payment equivalent to approximately 18 months of the elected officer’s or 24 months of the Chief Executive Officer’s premiums on the Company-sponsored medical coverage in effect on the date of the Qualifying Termination.

 

Role of Our Outside Compensation Consultant

Pursuant to the Compensation Committee charter, the Compensation Committee has the sole authority to (i) engage compensation consultants to assist in the evaluation of non-employee director and executive officer compensation, (ii) set the fees and other retention terms of such compensation consultants, and (iii) assess the independence of such compensation consultants. These consultants report directly to the Compensation Committee and do not perform any services directly on behalf of our management team.

Before selecting a compensation consultant, the Compensation Committee considers all factors relevant to assessing such compensation consultant’s independence, including the following six factors:

 

  LOGO

The provision of other services to the Company by the compensation consultant’s employer;

 

 

  LOGO

The amount of fees received from the Company by the compensation consultant’s employer, as a percentage of total revenues of the employer;

 

 

  LOGO

The policies and procedures of the compensation consultant’s employer that are designed to prevent conflicts of interest;

 

 

  LOGO

Any business or personal relationship of the compensation consultant with a member of the Compensation Committee;

 

 

  LOGO

Any stock of the Company owned by the compensation consultant; and

 

 

  LOGO

Any business or personal relationship of the compensation consultant or the compensation consultant’s employer with one of our executive officers.

 

The Compensation Committee has retained, and has confirmed the independence of, Semler Brossy as an outside consultant to assist, as directed, in the fulfillment of various aspects of the Compensation Committee’s charter. Semler Brossy reports directly to the Compensation Committee and participates in executive sessions with the Compensation

 

 

 

 

 

   

 

The J. M. Smucker Company       LOGO       2024 Proxy Statement      55  


EXECUTIVE COMPENSATION

 

Committee, without members of our management present. Our Chief Executive Officer, Chief People and Company Services Officer, and Chief Legal Officer or Vice President of ESG also attend the non-executive session portions of the Compensation Committee meetings.

In accordance with its corporate governance model, the Compensation Committee makes all decisions concerning compensation and benefits for our executive officers, and the Compensation Committee relies on Semler Brossy for advice, data, and market information regarding executive officer and director compensation.

During fiscal year 2024, Semler Brossy attended all Compensation Committee meetings either in person or virtually and assisted the Compensation Committee with:

 

  LOGO

Providing updates on relevant trends and developments in executive officer and director compensation;

 

 

  LOGO

Assessing our peer group and the competitiveness of pay levels and practices;

 

 

  LOGO

Evaluating programs and recommendations put forth by management against the Compensation Committee’s stated rewards objectives;

 

 

  LOGO

Reviewing the compensation of non-employee directors and executive officers;

 

 

  LOGO

Reviewing information to be included in the compensation sections of our Proxy Statement; and

 

 

  LOGO

Reviewing our risk assessment of all of our compensation plans.

 

The Compensation Committee authorized Semler Brossy staff members working on the Compensation Committee’s behalf to interact with our management, as needed, to obtain or confirm information for presentation to the Compensation Committee. Semler Brossy has never performed any additional services for the Company other than the types of services mentioned herein.

Determination of Compensation for Executive Officers

We believe that the compensation paid to our executive officers must be fair, equitable, and competitive enough to attract and retain qualified individuals. We also believe that there are certain non-financial, intangible elements of the overall compensation program that provide a positive work environment and provide value for our employees.

Compensation Market Assessment

In an effort to provide competitive, fair, and equitable compensation, target compensation opportunities for our executive officers are evaluated annually based on a compensation market assessment. To inform its decisions regarding establishing target compensation opportunities for our executive officers for fiscal years 2024 and 2025, the Compensation Committee used market data for hundreds of general industry companies that participated in two major executive compensation surveys.

The two survey databases used included the Willis Towers Watson U.S. CDB General Industry Executive Database (the “Towers Survey”) and the AON-Radford U.S. Total Compensation Measurement Executive Survey (the “Aon Survey” and, together with the Towers Survey, the “Compensation Study”). The information for all companies reporting data for a specific job from the Compensation Study was used when the Compensation Committee reviewed compensation. This data was then size adjusted using regression analysis to reflect our annual revenues and, where appropriate, the size of a specific business area. The Compensation Study for fiscal year 2025 also included publicly available proxy data compiled by Semler Brossy for the following peer group:

 

Campbell Soup Company

  

Ingredion Incorporated

Church & Dwight Co., Inc.

  

Kellanova

The Clorox Company

  

Keurig Dr Pepper Inc.