Clorox Company (The)
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DEF 14A 1 clorox3957551-def14a.htm DEFINITIVE PROXY STATEMENT

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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
 
SCHEDULE 14A

Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No.            )
 
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  THE CLOROX COMPANY  
  (Name of Registrant as Specified In Its Charter)  
 
       
 
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To Our Fellow Shareholders


In February 2021, I assumed the role of Independent Chair and it has been my honor to work with the Board, management and the Clorox stakeholder community at this important time for our company and our world. This past year, the company delivered strong progress against the IGNITE strategy for long-term growth even as we all continue to navigate the unprecedented challenges of the pandemic. Through it all, we have been guided by our commitment to putting people at the center of everything we do, and by our new company purpose: we champion people to be well and thrive every single day.

As stewards of our company, the Board plays a critical role in guiding and overseeing the IGNITE strategy, including the integrated environmental, social and governance (ESG) goals. The Board has continued to be agile, adapting to changing circumstances in order to continue to oversee and guide management, provide appropriate risk oversight and ensure the company continues to serve the interest of its shareholders and broader stakeholders.

Our Board represents the right combination of broad and deep experience in strategy development, operational excellence, innovation, human capital and culture, the consumer packaged goods industry, as well as other important areas that are directly relevant to the Company’s strategic priorities. In addition to bringing important skills, this year’s Board nominees also represent a wide range of backgrounds and experiences, which we believe are reflective of our global operations and diverse consumer base. Our director nominee slate includes four women and three people of color. Of our 11 director nominees, 10 are independent. We are proud of the continuing evolution of our Board and our track record on refreshment.

We also remain committed to inclusion and diversity across our workforce. To foster transparency and accountability with our stakeholders, we published EEO-1 data in 2020 along the same categories under which we report to the U.S. Equal Employment Opportunity Commission (EEOC). This year, we also published our latest U.S. Consolidated EEO-1 Report that we submitted to the EEOC.

We have a long-standing practice of regular engagement with our shareholders to discuss our strategy, direction and practices. Regular shareholder feedback informs the Board’s thinking and allows us to continue broadening our perspective. To that end, we hope that you will read this proxy statement and vote either by proxy or at the Annual Meeting. Your vote is very important.

Finally, on behalf of the Board, I would like to thank Pamela Thomas-Graham for her distinguished service to the Company. Pamela, who is not standing for election this year, joined the Board in 2005 and served as lead independent director from 2016 to 2021. She has been a wise and important voice on our Board, and we will miss her contributions.

On behalf of the Board, thank you for your continuing trust and investment in Clorox.


Matthew Shattock
Independent Chair


In the second year of the pandemic, we delivered strong sales growth and bolstered our position with global consumers. Our performance as a company demonstrated the resilience of our categories and the strengths of our people, brands and products, and I’m extremely proud of our team, who worked tirelessly to supply consumers with products across our portfolio. While the industry environment remains dynamic, we are laser focused on managing the factors within our control, including strong execution to rebuild margin and manage ongoing inflationary pressures. We are also accelerating our IGNITE strategy to take advantage of the strong customer loyalty we have built, respond to the changing consumer behaviors, and set the company up to deliver sustainable long-term growth. We will continue to invest in our brands, innovate and digitally transform our business. I invite you to read more about our results and plans to accelerate our IGNITE strategy in our 2021 Integrated Annual Report.

The last year exemplified our purpose and values in action. We champion people to be well and thrive every single day by doing the right thing, putting people at the center, and playing to win. We embraced our role as a health and wellness company, taking care of our teammates around the world, focusing on serving public health and consumer needs, and leading with our values. I’m particularly proud that, despite the demands of this past year, we achieved our best safety score in recorded history, which is significantly lower than the industry average.

We continue to make progress on our ESG goals, which are an integral part of our IGNITE strategy. This past year, we achieved our goal of 100% renewable electricity in the U.S. and Canada, and 56% of our plants have achieved zero-waste-to-landfill status. We also received approval of our 2030 science-based targets to reduce greenhouse gas emissions and recently announced our commitment to reach net-zero emissions across our operations and our value chain (Scopes 1, 2 and 3) by 2050. Our ESG efforts this year continued to be recognized, as we were again named to Barron’s Most Sustainable Companies list, 2021 Bloomberg Gender-Equality Index, and the Human Rights Campaign’s 2021 Corporate Equality Index, among others.

We also renewed The Clorox Company Foundation’s mission to align even more closely to our corporate purpose. Now focused on health security in the communities in which we live and work, the Foundation continued to support COVID relief efforts, racial justice initiatives and community building through nearly $20 million in product donations, cause marketing and grants to charitable organizations.

Moving forward, with our focus on strong execution of our strategy and the key investments we are making to strengthen our capabilities, our people, and our global portfolio of trusted brands, I am confident in our ability to deliver long-term value to all our stakeholders.

Thank you, fellow shareholders, for your continued support of our company.



Linda Rendle
Director and Chief Executive Officer


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Notice of Annual Meeting of Shareholders

The 2021 Annual Meeting of Shareholders (the Annual Meeting) of The Clorox Company (Clorox or the Company) will be held at 9:00 a.m. Pacific time on Wednesday, November 17, 2021, for the following purposes:

1. To elect the 11 director nominees named in the proxy statement;
2. To hold an advisory vote to approve executive compensation;
3. To ratify the selection of Ernst & Young LLP as the Company’s independent registered public accounting firm;
4. To approve the Amended and Restated 2005 Stock Incentive Plan to extend the term of the plan, revise the number of shares available for grant under the plan and make certain other amendments; and
5. To consider and vote on the shareholder proposal described in the accompanying proxy statement, if properly presented at the Annual Meeting.

Due to concerns relating to the coronavirus (COVID-19) pandemic, and to support the health and well-being of our employees and shareholders, this year’s Annual Meeting will be virtual and will be held entirely online via live webcast at https://meetnow.global/MNGZAZQ. There will not be an option to attend the meeting in person.

Shareholders also will consider and act upon such other business as may properly come before the Annual Meeting or any adjournment or postponement.

Shareholders of record at the close of business on September 24, 2021, are entitled to vote at the Annual Meeting and any adjournment or postponement.

While you will not be able to attend the Annual Meeting at a physical location, we have designed the virtual Annual Meeting to ensure that our shareholders are given the same rights and opportunities to actively participate in the Annual Meeting as they would at an in-person meeting, using online tools to facilitate shareholder access and participation.

How to Attend the 2021 Virtual Annual Meeting. This year’s Annual Meeting will be virtual and held online via live webcast. In order to attend and participate in the Annual Meeting, you will need to visit https://meetnow.global/MNGZAZQ, and you will be required to enter the 15-digit control number included on your Notice of Internet Availability of Proxy Materials, on your proxy card (if you received a printed copy of the proxy materials), or on the

instructions that accompanied your proxy materials to access the meeting. If you are the beneficial owner of shares held in “street name” (that is, you hold your shares through a broker, bank or other holder of record), you must register in advance to gain access to the Annual Meeting and to vote your shares or ask questions during the Annual Meeting. Please see the Attending the Virtual Annual Meeting section of the proxy statement for more information. Whether or not you plan to attend the virtual Annual Meeting, we encourage you to vote and submit your proxy in advance of the meeting by one of the methods described on pages 83-84. You may also vote online and examine our shareholder list during the Annual Meeting by following the instructions provided on the meeting website during the Annual Meeting. To vote at the meeting, visit https://meetnow.global/MNGZAZQ and log in using the aforementioned information.

On or about October 6, 2021, we began mailing a Notice of Internet Availability of Proxy Materials to our shareholders informing them that our Proxy Statement, 2021 Integrated Annual Report – Executive Summary, and voting instructions are available on the Internet as of the same date.

Your vote is very important. Even if you plan to attend the virtual Annual Meeting, we hope that you will read the proxy statement and vote your proxy by telephone, via the Internet, or by signing, dating, and returning the proxy card in the envelope provided.

By Order of the Board of Directors,

 

Iké Adeyemi
Vice President – Corporate Secretary &
Associate General Counsel

The Clorox Company
1221 Broadway
Oakland, California 94612

October 6, 2021

Important Notice Regarding the Availability of Proxy Materials for The Clorox Company Shareholders Meeting to be Held on November 17, 2021: The Notice of Annual Meeting, Proxy Statement, and 2021 Integrated Annual Report – Executive Summary will be available at www.edocumentview.com/CLX.


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YOUR VOTE IS IMPORTANT, NO MATTER HOW MANY OR HOW FEW SHARES YOU OWN

If you have questions about how to vote your shares, or need additional assistance, please contact Innisfree M&A Incorporated, who is assisting us in the solicitation of proxies:

501 Madison Avenue, 20th Floor
New York, New York 10022

Shareholders may call toll-free at (877) 750-9499

Banks and brokers may call collect at (212) 750-5833

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Table of Contents
Proxy Summary       2
Proposals to be Voted on and Board Voting Recommendations 2
Our Director Nominees 2
IGNITE Strategy and ESG Highlights 3
Corporate Governance Strengths 4
Business Performance and Executive Compensation Highlights 4
What We Pay: Components of Our Compensation Program 5
Board of Directors 6
Proposal 1: Election of Directors 6
Who We Are: Our Director Nominees 6
Shareholder Engagement 16
How We Identify, Evaluate and Nominate Our Directors 17
Board Leadership Structure 20
Annual Board and Director Evaluation Process 21
Vote Required 21
Board’s Recommendation 21
How Our Directors Govern 22
Related Person Transaction and Conflict of Interest Policies and Procedures 24
Code of Conduct 25
Board Committees 25
How Our Directors Are Paid 26
Our Company 29
Our Purpose and Values 29
Fiscal Year 2021 Performance 30
IGNITE Strategy Guided by ESG Principles 30
Stock Ownership Information 34
Beneficial Ownership of Voting Securities 34
Delinquent Section 16(a) Reports 35
Executive Compensation 36
Proposal 2: Advisory Vote to Approve Executive Compensation 36
Board’s Recommendation 36
Vote Required 36
Compensation Discussion and Analysis 37

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Equity Compensation Plan Information       67
     
Audit Committee Matters  68
Proposal 3: Ratification of Independent Registered Public Accounting Firm 68
Board’s Recommendation 68
Vote Required 68
Audit Committee Report 69
Fees of the Independent Registered Public Accounting Firm 70
     
Additional Items to be Voted On 71
Proposal 4: Approval of Amended and Restated 2005 Stock Incentive Plan 71
Summary of Key Equity Compensation Plan Data 72
Board’s Recommendation 78
Vote Required 78
Proposal 5: Shareholder Proposal 79
Board’s Statement in Opposition 80
Board’s Recommendation 82
Vote Required 82
     
Information About the Virtual Annual Meeting 83
Delivery of Proxy Materials 83
Voting Information 83
Form 10-K, Financial Statements, and Integrated Annual Report – Executive Summary 85
Solicitation of Proxies 86
Shareholder Proposals and Director Nominations for the 2022 Annual Meeting 86
Eliminating Duplicative Proxy Materials 87
     
Attending the Virtual Annual Meeting 88
Submitting Questions for the Virtual Annual Meeting 89
     
Appendix A: Proposed Amended & Restated 2005 Stock Incentive Plan A-1
     
Appendix B: Management’s Discussion and Analysis of Financial Condition and Results of Operations B-1

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  Proxy Summary

This summary highlights information contained elsewhere in this proxy statement and does not contain all of the information that you should consider. Please review the entire proxy statement before voting.


Proposals to be Voted on and Board Voting Recommendations

            More
information
      Board’s voting
recommendation
PROPOSAL 1 Election of Directors Page 6 FOR EACH NOMINEE
PROPOSAL 2 Advisory Vote to Approve Executive Compensation Page 36 FOR
PROPOSAL 3 Ratification of Independent Registered Public Accounting Firm Page 68 FOR
PROPOSAL 4 Approval of Amended and Restated 2005 Stock Incentive Plan Page 71 FOR
PROPOSAL 5 Shareholder Proposal Requesting Non-Management Employees on Director Nominee Candidate Lists Page 79 AGAINST


Our Director Nominees

The following table provides summary information about each director nominee as of the date of the Annual Meeting.

Name       Age       Director
Since
      Principal Occupation       Independent       Committee
Memberships
Amy Banse 62 2016 Senior Adviser to the Executive Committee, Comcast Corporation
AC
Richard H. Carmona 71 2007 Chief of Health Innovations, Canyon Ranch
NGCRC
MDCC
Spencer C. Fleischer 68 2015 Chairman, FFL Partners, L.P.
MDCC (Chair)
Esther Lee 62 2013 Former Executive Vice President – Global Chief Marketing Officer, MetLife Inc.
NGCRC (Chair)
A. D. David Mackay 66 2016 Former President and Chief Executive Officer, Kellogg Company
AC
MDCC
Paul Parker 58 2020 Senior Vice President, Strategy and Corporate Development, Thermo Fisher Scientific Inc.
AC
Linda Rendle 43 2020 Chief Executive Officer, Clorox
Matthew J. Shattock 59 2018 Former Non-Executive Chairman, Beam Suntory Inc.
NGCRC
Kathryn Tesija 58 2020 Former Executive Vice President and Chief Merchandising and Supply Chain Officer, Target Corporation
MDCC
NGCRC
Russell J. Weiner 53 2017 Chief Operating Officer, Domino’s Pizza, Inc. President, Domino’s US
MDCC
Christopher J. Williams 63 2015 Chairman, Siebert, Williams, Shank & Co. LLC
AC (Chair)
AC Audit Committee
NGCRC        Nominating, Governance and Corporate Responsibility Committee
MDCC Management Development and Compensation Committee

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Proxy Summary


IGNITE Strategy and ESG Highlights

In fiscal year 2020, we introduced our IGNITE strategy to guide us to deliver purpose-driven growth. IGNITE embeds environmental, social and governance (ESG) priorities into our decision-making because we believe in the strategic link between our societal impact and long-term value creation for all our stakeholders, including shareholders, consumers, customers, employees, the communities where we operate and our planet.

ESG Pillars

We are a health and wellness company at heart with our choices guided by a company purpose: We champion people to be well and thrive every single day. To fulfill that purpose, we have established ESG goals that are organized around the pillars of Healthy Lives, Clean World, and Thriving Communities, and are supported by Strong Governance.

Healthy Lives: Improving people’s health and well-being.
Clean World: Taking climate action and reducing plastic and other waste.
Thriving Communities: Investing in our people and communities to contribute to a more equitable world.
Strong Governance: Enhancing our leadership in ESG through an unwavering commitment to strong corporate governance and ESG performance overseen by the Board.

ESG Highlights

Less than two years after launching our IGNITE strategy, we have made significant progress on our ESG goals – even in the face of an unprecedented public health crisis that significantly impacted our operations.

In fiscal year 2021, we achieved our goal of 100% renewable electricity in our U.S. and Canada operations, and we are committed to maintaining this, going forward, through a virtual power purchase agreement. We also embedded ESG further into our business units. For example, Brita and Glad each established their own sustainability goals, demonstrating that environmental and social responsibility are core to their purpose. Brita committed to provide 500,000 people access to clean water in vulnerable U.S. communities with poor quality tap water by 2024, and one million people by 2030. Glad committed to reduce virgin plastic across its trash business by 50% by 2030 and help 100,000 households that are currently without recycling options gain access over the next three years. These are just two examples

of the work being done by our business units to establish their own sustainability priorities specific to their business and stakeholders.

As part of our climate strategy, we have also received approval of our science-based targets from the Science-Based Targets initiative (a partnership between the UN Global Compact and other environmental non-governmental organizations) and recently announced our commitment to reach net zero emissions across our operations and value chain by 2050.

Inclusion and diversity has continued to be core to who we are.

As of the Annual Meeting date, women comprise 36% of our director nominees and 46% of our executive committee. Additionally, our CEO is one of 41 women leading a Fortune 500 company. People of color comprise 27% of our director nominees and 23% of our executive committee. Each year, our directors and officers self-identify their gender (male, female or non-binary) and whether they are lesbian, gay, bisexual, transgender or queer (LGBTQ). In fiscal year 2021, two of our executive committee members identified as LGBTQ.

As part of our continued commitment to transparency and progress in our inclusion and diversity commitments and based on feedback from internal and external stakeholders, in 2020, we published our U.S. demographic representation data, or EEO-1 data, along the same categories under which we report to the EEOC. This year, we also published our latest U.S. Consolidated EEO-1 Report that we submitted to the EEOC. This EEO-1 information is available on the Company’s website at https://www.thecloroxcompany.com. Please note that information on or accessible through this website is not part of, or incorporated by reference into, this proxy statement. To provide even greater insight into our representation, we further enhanced our disclosures by including representation data by Clorox job category over a three-year period in our 2021 Integrated Annual Report.

In 2021, we earned recognition from third parties for our inclusion and diversity initiatives. We were included in the Bloomberg Gender-Equality Index, which tracks the performance of public companies committed to supporting gender equality through policy development, representation and transparency. We also maintained our 100% score on the Human Rights Campaign’s Corporate Equality Index and were named by Parity.org to its list Best Companies for Women to Advance.


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Proxy Summary


Corporate Governance Strengths

Board Structure and Independence

All of our director nominees are independent, except for our CEO
Split chair and CEO roles – with independent chair
100% independent Board committee members
Independent chair can call special meetings of the independent directors and actively supervises meeting materials, agendas and schedules
Robust code of conduct applicable to directors, officers and employees

Board Oversight

Robust processes for overseeing key risks
Board receives regular updates on key ESG topics
Strong Board and management succession planning process

Director and Executive Compensation

Rigorous stock ownership guidelines for directors and executives
Directors and officers prohibited from hedging our stock, and Section 16 insiders are prohibited from pledging our stock under our insider trading policy
Both our annual and long-term incentive plans include clawback provisions

Shareholder Rights and Accountability

Special meeting right for shareholders
Annual election of all directors
Proactive shareholder engagement
Proxy access right for shareholders

Board Composition

Diverse Board with effective mix of skills, experiences, and perspectives
Diverse Board leadership on committees
Adopted formal Board diversity policy in fiscal year 2020
Active Board refreshment – average Board tenure is approximately 5.3 years (as of the Annual Meeting date)
Effective annual Board, Board committee, and individual director evaluation process
Majority voting and director resignation policy in uncontested director elections



Business Performance and Executive Compensation Highlights

Clorox continued to experience an unprecedented business environment in fiscal year 2021. In fiscal year 2020, the COVID-19 pandemic caused significant economic and social disruptions and uncertainties, and events during fiscal year 2021 continued that trend. After breakout results for both sales and net earnings in fiscal year 2020, fiscal year 2021 results were mixed, with continued year-over-year strength in net sales and a decrease in net earnings.
Our incentive plan results reflect Company performance. Our slightly below-target payouts on both short- and long-term incentives align to the offsetting business outcomes of significant sales growth, over a similarly high-growth prior fiscal year, offset by declines in gross margin and net earnings.
The Company performance portion of our short-term incentive for fiscal year 2021 was funded at 98%. This result reflected the mixed outcomes in fiscal year 2021 for our underlying metrics: net sales, net earnings attributable to Clorox, and gross margin.
The Company performance portion of our long-term incentive award vesting in 2021 paid out at 94%. The performance-based award vesting in fiscal year 2021 was based on economic profit (EP) growth during fiscal years 2019 through 2021, covering two years of lower-than-expected EP growth and one breakout year with extremely high EP growth.
The Management Development and Compensation Committee continues to evolve our program. As we look ahead to fiscal year 2022, anticipating record cost inflation and rapidly changing consumer demand, we remain committed to our philosophy of pay for performance. Our incentive plans will be updated based on market benchmarks, changes in our business environment and areas where we are committed to ensuring alignment of pay and performance, such as ESG achievement.

Please refer to the Compensation Discussion and Analysis section in this proxy statement for further details.



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Proxy Summary


What We Pay: Components of Our Compensation Program

A substantial portion of our target total direct compensation for our executives is variable, with 87% of compensation at risk for our CEO and 80% of compensation at risk on average for our other named executive officers (NEOs). Base salary is the only fixed component of direct compensation.

Component and Rationale       CEO
Proportion(1)
      NEO(2)
Proportion(1)
      Performance
Measures
      Performance
Period
      Characteristics

Base Salary

Fixed pay to attract and retain talent, based on role, level of responsibilities, and individual performance.

N/A
N/A Fixed cash

Annual Incentives

Variable pay to incent and recognize performance in areas of short-term strategic importance.

Annual net sales (50%)
Net earnings (30%)
Gross margin (20%)
Individual performance goals
One Year Performance-based cash

Long-Term Incentives

Equity-based pay to incent and recognize performance in areas of long-term strategic importance, promote retention and stability, and align executives with shareholders.

Three-year annual economic profit growth rate
Variation in underlying stock price due to overall business results
Three Years Performance share units, stock options, and restricted stock units
(1) Proportion represents the actual base salary, target annual incentive award, and grant date fair market value of actual long-term incentive awards granted in fiscal year 2021 (with performance share units measured at target). Refer to the Summary Compensation Table for further details on actual compensation.
(2) Represents the average of all NEOs active on June 30, 2021, other than the CEO. Percentages are rounded.

Additional elements of our executive compensation program include retirement plans, post-termination compensation, and perquisites as appropriate to support our executive compensation philosophy.

Please refer to the Compensation Discussion and Analysis section in this proxy statement for further details.

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Board of Directors

Proposal 1:
Election of Directors

The Board, upon the recommendation of the Nominating, Governance and Corporate Responsibility Committee (NGCRC), has nominated the 11 people listed below for election at the Annual Meeting to serve until the 2022 Annual Meeting of Shareholders, and until their respective successors are duly elected and qualified. All of the director nominees currently serve on the Board.

The NGCRC examines the overall composition of the Board to assess the skills and characteristics that are currently represented on the Board, and in incumbent Board members, as well as the skills and characteristics

that the Board may find valuable in the future in light of the Company’s strategic and anticipated business needs, on an annual basis, or more frequently, if needed.

Pamela Thomas-Graham, who has served on the Board since 2005, is not standing for re-election when her term expires at the Annual Meeting. We would like to thank Ms. Thomas-Graham for her many years of service, including nearly five years as our lead independent director, and substantial contributions to the Board, Clorox and our shareholders.



Who We Are: Our Director Nominees

We invite you to read about our director nominees below. Our director nominees represent diverse perspectives and experiences and bring core strategic, operating, financial and governance skills as well as consumer product expertise to our Board. Each of the director nominees has agreed to be named in this proxy statement and to serve as a director if elected.

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Proposal 1: Election of Directors

Director Since Name, Principal Occupation, and Other Information

2016

Amy Banse
Amy Banse has served as senior adviser to the executive committee of Comcast Corporation, a global media and technology company (including Comcast Ventures, LLC, its venture capital arm), since September 2020. She previously served as executive vice president, Comcast Corporation, from January 2020 to September 2020 and as managing director and head of funds at Comcast Ventures LLC from August 2011 to September 2020. Under her leadership, Comcast Ventures grew the size and diversity of its portfolio, making it one of the country’s most active corporate venture arms, investing in early- and later-stage companies across a wide spectrum of industries, including commerce, digital media, cybersecurity, SaaS, enterprise, and autonomous vehicles. From 2005 to 2011, Banse was senior vice president, Comcast Corporation and president, Comcast Interactive Media, a division of Comcast responsible for developing online strategy and operating the company’s digital properties. In this role, she drove the acquisition of a number of digital properties, including Fandango, and, together with her team, oversaw the development of Xfinity TV. Since joining Comcast in 1991, Banse has held various positions at the company, including content development, programming investments and overseeing the development and acquisition of Comcast’s cable network portfolio. Earlier in her career, Banse was an associate at Drinker, Biddle & Reath LLP.

Other Public Company Boards:
Banse serves as a director of Adobe, Inc. (May 2012 to present), Lennar Corporation (February 2021 to present) and On Holding AG (September 2021 to present).

Nonprofit/Other Boards:
Banse serves on the boards of a number of Comcast Ventures’ portfolio companies.

Director Qualifications:
Banse’s experience in starting, investing in and building businesses provides her with deep strategic and financial expertise, and her executive leadership roles contribute to her management and operational knowledge. Banse’s deep expertise in media and technology also enables her to contribute valuable insights into digital media and online business. Age: 62.

Committee Membership:
Audit Committee.


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Proposal 1: Election of Directors

Director Since Name, Principal Occupation, and Other Information

2007

Richard H. Carmona, M.D., M.P.H., F.A.C.S.
Richard Carmona has been chief of health innovations of Canyon Ranch Inc., a life-enhancement company, since August 2017. He previously served as vice chairman of Canyon Ranch, chief executive officer of the Canyon Ranch health division, and president of the nonprofit Canyon Ranch Institute from October 2006 to August 2017. He is the first distinguished professor of public health at the Mel and Enid Zuckerman College of Public Health at the University of Arizona. Prior to joining Canyon Ranch, Carmona served as the 17th Surgeon General of the United States from 2002 through 2006, achieving the rank of vice admiral. Previously, he was chairman of the State of Arizona Southern Regional Emergency Medical System, a professor of surgery, public health, and family and community medicine at the University of Arizona, and surgeon and deputy sheriff of the Pima County, Arizona, Sheriff’s Department. Carmona served in the United States Army and the Army’s Special Forces.

Other Public Company Boards:
Carmona serves as a director of Axon Enterprise, Inc. (formerly Taser International, March 2007 to present), Herbalife Ltd. (October 2013 to present), and McKesson Corporation (September 2021 to present).

Nonprofit/Other Boards:
Carmona serves on the boards of NuvOX Pharma LLC, TherimuneX Pharmaceuticals, Inc., Better Therapeutics, LLC, and Health Literacy Media.

Director Qualifications:
Carmona’s experience as the Surgeon General of the United States and extensive background in public health, including as CEO of a hospital and healthcare system, provides him with a valuable perspective on public health and wellness matters, as well as insight into regulatory organizations and institutions, all of which are important to the Company’s business strategy. In addition, his executive leadership background, including with a global lifestyle enhancement company, provides him with international experience and enables him to make valuable contributions to the Company’s international growth strategies. Carmona’s experience in the United States Army and in academia also strengthens the Board’s collective qualifications, skills and experience. Age: 71.

Committee Membership:
Nominating, Governance and Corporate Responsibility Committee; Management Development and Compensation Committee.


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Proposal 1: Election of Directors

Director Since Name, Principal Occupation, and Other Information

2015

Spencer C. Fleischer
Spencer Fleischer has served since March 2021 as Chairman of FFL Partners, L.P. (FFL), a private equity firm, where he was previously managing partner from April 1998 to March 2021. Before co-founding FFL, Fleischer spent 19 years with Morgan Stanley & Company as an investment banker and manager. At Morgan Stanley & Company, he was a member of the worldwide Investment Banking Operating Committee and also held roles including head of investment banking in Asia and head of corporate finance for Europe.

Other Public Company Boards:
Fleischer is a director of Levi Strauss & Co. (July 2013 to present). He was previously a director of Banner Corporation (October 2015 to December 2016).

Nonprofit/Other Boards:
Fleischer is a director of Americans for Oxford, Inc.

Director Qualifications:
Fleischer brings to the Board more than 40 years of financial and operational expertise as well as deep international experience. His significant experience in both private equity and investment banking enables him to contribute valuable insights into strategic planning, mergers and acquisitions and operating expertise to the Company. His leadership role at FFL also allows him to provide significant experience in compensation matters. Age: 68.

Committee Membership:
Management Development and Compensation Committee (Chair).

 

2013

Esther Lee
Esther Lee served as executive vice president – global chief marketing officer at MetLife Inc., an insurance, annuities, and employee benefits company, from January 2015 to June 2021. Previously, Lee served as senior vice president – brand marketing, advertising and sponsorships for AT&T from 2009 to December 2014. From 2007 to 2008 she served as CEO of North America and president of global brands for Euro RSCG Worldwide. Prior to that, she served for five years as global chief creative officer for The Coca-Cola Company. Earlier in her career, Lee worked in several leadership positions in the advertising industry, including as co-founder of DiNoto Lee. In this capacity, Lee worked with several consumer packaged goods companies, including Procter & Gamble, Unilever and Nestle.

Director Qualifications:
Lee brings to the Company significant executive and marketing expertise, focused on developing customer strategies to drive growth, building high-performing teams, and driving customer-centric innovation and transformation. Her prior executive leadership roles in global brand marketing, advertising, media and sponsorship have afforded her expertise in consumer engagement, creativity and digital transformation, as well as the operating models in these areas, that enable her to provide valuable contributions to the Company’s business strategies. Age: 62.

Committee Membership:
Nominating, Governance and Corporate Responsibility Committee (Chair).


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Director Since Name, Principal Occupation, and Other Information

2016

A. D. David Mackay
David Mackay served as president and chief executive officer of Kellogg Company, a food manufacturing company, from 2006 until his retirement in 2011. From 2003 to 2006, he served as the company’s president and chief operating officer. Prior to that, Mackay held a number of other leadership positions at Kellogg, including roles at Kellogg Australia, United Kingdom and Republic of Ireland. He also previously served as managing director of Sara Lee Corporation in Australia and held various positions at Mars, Inc.

Other Public Company Boards:
Mackay is a director of Fortune Brands Home and Security (September 2011 to present). Mackay previously served as a director of Keurig Green Mountain, Inc. (December 2012 to March 2016).

Nonprofit/Other Boards:
Mackay serves on the boards of FSHD Global Research Foundation Ltd., Facio Therapies, and Tropic Sport LLC.

Director Qualifications:
Mackay brings significant strategic leadership and operational experience to the Board. His extensive consumer products background and his international experience allow him to contribute valuable insights regarding the Company’s industry, operations and international businesses. In addition, his previous leadership roles provide him with expertise in executive compensation and succession planning matters. Age: 66.

Committee Membership:
Audit Committee; Management Development and Compensation Committee.


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Director Since Name, Principal Occupation, and Other Information

2020

Paul Parker
Paul Parker has served as senior vice president, strategy and corporate development for Thermo Fisher Scientific Inc. since April 2020, with responsibility for corporate strategy, mergers and acquisitions, integration management, corporate social responsibility, government relations, and digital marketing.

Parker has 35 years of M&A banking experience in multiple sectors and geographies. Prior to joining Thermo Fisher, Parker served as co-chairman of the global mergers and acquisitions group for Goldman Sachs & Co. from August 2014 to March 2020, and also served on the firm’s Partnership Committee and the Investment Banking Senior Leadership Council.

Prior to Goldman Sachs, Parker served as chairman and head of global M&A at Barclays from September 2008 to July 2014, having also assumed responsibility for global corporate finance from June 2012 to October 2013. He also served on Barclays’ Americas Management Committee. From 1995 to 2008, Parker was an investment banker at Lehman Brothers in several leadership positions, including serving as head of U.S. mergers and acquisitions from 2003 to 2008 and chairman and head of global mergers and acquisitions during 2008. At both Barclays and Lehman Brothers, Parker served on the Executive Committee for the Investment Banking Division.

Director Qualifications:
Parker brings deep financial, accounting and strategic expertise to the Board based on 35 years working in the banking and finance industries, as well as his experience leading strategy and corporate development for a major multi-national public company. His long experience in investment banking and expertise in mergers and acquisitions enable him to provide important insights to the Company on strategy and growth. His management roles in leading sustainability and digital marketing bring additional critical skills. Age: 58.

Committee Membership:
Audit Committee.


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Director Since Name, Principal Occupation, and Other Information

2020

Linda Rendle
Linda Rendle is chief executive officer of the Company, a role she assumed in September 2020. Previously, she served as president of the Company from May 2020 to September 2020. Before becoming president, she served as executive vice president – Cleaning, International, strategy and operations from July 2019 to May 2020, and executive vice president – strategy and operations from January 2019 to July 2019. Previously, she was executive vice president – Cleaning and strategy from June 2018 to January 2019, and she served as senior vice president and general manager – Cleaning, from August 2016 to June 2018, with additional responsibility for Professional Products as of April 2017. She served as vice president and general manager – Home Care from October 2014 to August 2016. She began her Clorox career in 2003 in the Sales division, where she served in various positions of increasing responsibility in sales planning and supply chain, culminating in her role as vice president of sales – Cleaning, from 2012 to 2014. Before joining Clorox, Rendle worked for Procter & Gamble, where she held several positions in sales management in the Boston and Charlotte markets.

Other Public Company Boards:
Rendle is a director of Visa Inc. (November 2020 to present).

Nonprofit/Other Boards:
Rendle is a director of The Consumer Brands Association.

Director Qualifications:
Rendle’s long tenure at the Company and deep understanding of the consumer packaged goods industry, the Company’s businesses and her instrumental role in developing the Company’s IGNITE strategy enable her to provide valuable contributions with respect to strategy, growth and long-range plans. Additionally, her track record of outstanding business results and values-led leadership across many of the Company’s businesses provides her with a diverse perspective on global sales, product innovation and business strategy. Age: 43.


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Director Since Name, Principal Occupation, and Other Information

2018

Matthew J. Shattock
Matthew Shattock is the independent chair of the Company’s board of directors. He previously served as non-executive chairman of the board of Beam Suntory Inc., the world’s third largest premium spirits company, from April 2019 to December 2020. He previously served as chairman and CEO of Beam Suntory, having joined Beam in March 2009 as president and CEO and led the company’s successful growth strategy transformation and subsequent integration of the Beam and Suntory spirits businesses following Beam’s acquisition by Suntory in 2014. Prior to joining Beam, he spent six years at Cadbury plc, an international confectionary manufacturer, where he led its businesses first in The Americas and then in the Europe, Middle East and Africa region. Prior to Cadbury, Shattock spent 16 years at Unilever, an international manufacturer of food, home care and personal care products, in various leadership roles, culminating in his role as chief operating officer of Unilever Best Foods North America.

Other Public Company Boards:
Shattock serves as a director of VF Corporation (February 2013 to present) and Chairman of Domino’s Pizza Group plc (UK) (March 2020 to present).

Nonprofit/Other Boards:
Shattock serves as a director of Cooler Screens Inc., Tropicale Foods Inc., Reliefband Technologies LLC, Kendra Scott Design, Inc., The Boys and Girls Club of Lake County, Illinois and Teacher’s Retirement System of the State of Illinois.

Director Qualifications:
Shattock brings significant operational and executive leadership experience in the consumer packaged goods industry to the Board. His current and prior leadership roles, including overseeing the successful growth, integration and strategic transformation of a global spirits company as CEO, enable him to provide valuable insights to the Company’s business. Shattock has a strong track record of driving growth through innovation, brand communication and operational excellence. Age: 59.

Committee Membership:
Nominating Governance and Corporate Responsibility Committee.


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Director Since Name, Principal Occupation, and Other Information

2020

Kathryn Tesija
Kathryn (Kathee) Tesija has served as a senior adviser and consultant at Simpactful LLC, a consumer packaged goods and retail consultancy firm, since April 2016. Previously, she served as executive vice president and chief merchandising and supply chain officer for Target Corporation, the second-largest discount retailer in the United States, from 2008 to 2015. In this role, she oversaw all functions of product design and development, sourcing, merchandising, presentation, inventory management, operations, and global supply chain for Target.com and nearly 1,800 retail stores. During her tenure at Target beginning in 1986, she served in numerous positions of responsibility, including director, merchandise planning and senior vice president, merchandising. She continued to serve Target as a strategic adviser from July 2015 to March 2016.

Other Public Company Boards:
Tesija serves on the board of Woolworths Group Limited (May 2016 to present). She previously served on the board of Verizon Communications (December 2012 to May 2020).

Director Qualifications:
Tesija brings to Clorox large-scale global merchandising and supply chain experience as well as operational and strategic planning expertise. Her tenure as a retail industry executive allows her to provide insights into customer and consumer behavior. This experience, together with her expertise in digital, innovation and marketing, allows her to provide valuable perspective on the Company’s strategic priorities to innovate brand and shopping experiences. Age: 58.

Committee Membership:
Management Development and Compensation Committee; Nominating Governance and Corporate Responsibility Committee.

   

2017

Russell J. Weiner
Russell J. Weiner has served as chief operating officer for Domino’s Pizza, Inc., a restaurant chain, since July 2018, and president of Domino’s US since July 2020, having also served as president of the Americas from July 2018 to July 2020. Before assuming this position, he served as president of Domino’s USA from September 2014 through June 2018. Prior to his role as president of Domino’s USA, he served as the company’s executive vice president, chief marketing officer, starting in 2008. Before joining Domino’s, he was vice president of marketing, Colas at Pepsi-Cola North America from 2005 to 2008. During his tenure at Pepsi-Cola North America, which commenced in 1998, Weiner held a number of leadership roles in marketing and brand management.

Nonprofit/Other Boards:
Weiner is a director of GENYOUth Foundation.

Director Qualifications:
Weiner’s executive leadership experience in the food and consumer packaged goods industries enables him to contribute his deep knowledge of brand building, marketing, operations and consumer insights. In addition, his experience in digital innovation enables him to help the Company maintain its leadership position in digital technology within the consumer packaged goods industry. Age: 53.

Committee Membership:
Management Development and Compensation Committee.


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Director Since Name, Principal Occupation, and Other Information

2015

Christopher J. Williams
Christopher Williams is chairman of Siebert, Williams, Shank & Co., LLC, an investment banking and financial services company. Previously, Williams was chairman and chief executive officer of The Williams Capital Group, L.P. and Williams Capital Management, LLC (Williams Capital), an investment banking and financial services firm, since the company’s formation in 1994 until it merged with Siebert Cisneros Shank to form Siebert, Williams, Shank & Co. in November 2019. Prior to founding Williams Capital, Williams managed the derivatives and structured finance division of Jefferies & Company. He previously worked at Lehman Brothers, where his roles included managing groups in the corporate debt capital markets and derivatives structuring and trading.

Other Public Company Boards:
Williams is a director of Ameriprise Financial, Inc. (September 2016 to present) and of Union Pacific Corporation (November 2019 to present). He previously served on the boards of Caesars Entertainment Corporation (April 2008 to March 2019) and Wal-Mart Stores Inc. (June 2004 to June 2014).

Nonprofit/Other Boards:
Williams serves on the boards of Cox Enterprises Inc. and Lincoln Center for the Performing Arts.

Director Qualifications:
Williams brings a wealth of financial, accounting, and strategic expertise to the Board with his years of experience in investment banking and finance, and as the former chair of the audit committee of a Fortune 100 company. He also contributes important executive management and leadership experience as the chairman and chief executive officer of an investment management firm. As a current and former director of several public and private companies, he brings a valuable perspective for the Company’s strategy and operations as well as extensive customer insights. Age: 63.

Committee Membership:
Audit Committee (Chair).


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Shareholder Engagement

Shareholder Outreach and Communications

We maintain active, year-round engagement with our shareholders and aim to meet with our larger institutional shareholders in-person (conditions permitting), via conference calls, virtually (via video) or at investor conferences. We also routinely respond to inquiries and consider feedback received from individual shareholders and other stakeholders throughout the course of the fiscal year.

During the past fiscal year, our corporate secretary team, management and investor relations team, in addition to our NGCRC chair and independent chair, met with many of our investors to discuss key corporate governance, executive compensation, corporate responsibility, culture and other important ESG topics. These meetings enable two-way dialogue between our shareholders and the Company and provide a forum for our leadership to listen to our shareholders’ perspectives, answer any questions and engage in dialogue on any feedback they may have. Through these engagements, we seek to ensure our corporate governance framework remains responsive to the priorities of our stakeholders, while also enabling our business and strategic priorities.

The Board considers shareholder feedback from these meetings, along with emerging best practices, market standards, and policies at other companies in its deliberations and decision-making as well as our disclosures and commitments.

For example, after a comprehensive review and consideration of feedback from shareholders, in conjunction with our strategic and business priorities, our Board has effected changes in key areas relating to the Company’s compensation plan design and metrics, including by updating our executive compensation clawback policy and by expanding the factors considered in executive compensation award determinations. In February 2021, the MDCC updated its clawback policy to allow for recoupment of incentive compensation granted to current and former executive officers if the executive engages in conduct that is materially detrimental to Clorox. See Executive Compensation Governance in the Compensation Discussion and Analysis section of this proxy statement for more information. Further, for fiscal year 2022 and onwards, certain ESG components of our IGNITE scorecard – such as management of environmental risks and human capital, including diversity and inclusion –

will be embedded in each executive’s fiscal year priorities, and those scorecard results will be factored into the MDCC’s evaluation of each executive’s performance for their annual incentive awards. See the IGNITE Strategy Guided by ESG Principles section of this proxy statement for more information about the IGNITE scorecard.

In 2020, we also expanded our disclosures regarding diversity and inclusion by providing EEO-1 data along the same categories that we report to the EEOC on an annual basis. This year, in response to further shareholder feedback, we have elected also to provide the EEO-1 report that we submitted to the EEOC in December 2020. This EEO-1 information is available on the Company’s website at https://www.thecloroxcompany.com. We also further enhanced our disclosures by including representation data by Clorox job category over a three-year period in our 2021 Integrated Annual Report.

In September 2021, we announced new science-based targets as part of our climate strategy, which will put the Company on a path to net zero emissions across Scopes 1, 2 and 3 by 2050. These targets underscore our ongoing commitment to climate action, as we accelerate our IGNITE strategy for long-term value creation for all of our stakeholders. This is also an important priority for our shareholders, and shareholder and stakeholder feedback factored into the development of our commitment.

Shareholder Recommendations and Nominations of Director Candidates

The NGCRC considers recommendations from many sources, including shareholders, regarding possible candidates for director. Such recommendations, together with biographical and business experience information (similar to that required to be disclosed under the applicable Securities and Exchange Commission (SEC) rules and regulations) regarding the candidate, should be submitted to The Clorox Company, c/o Corporate Secretary, 1221 Broadway, Oakland, CA 94612-1888. The NGCRC evaluates all candidates for the Board in the same manner, including those suggested by shareholders.

In addition, our bylaws permit a shareholder or group of up to 20 shareholders who have owned at least 3% of the outstanding shares of the Company’s common stock for at least three years to submit director nominees


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(up to 20% of the Board) for inclusion in the Company’s proxy statement and form of proxy used in connection with the Annual Meeting (proxy materials) if the shareholder(s) provide(s) timely written notice of such nomination(s) and the shareholder(s) and the nominee(s) satisfy the requirements specified in the Company’s Bylaws. Shareholders who wish to nominate directors for inclusion in the Company’s proxy materials or directly at an annual meeting of shareholders in accordance with the procedures in our Bylaws should follow the instructions under the Shareholder Proposals and Director Nominations for the 2021 Annual Meeting section of this proxy statement.

Director Communications

Shareholders and interested parties may direct communications to individual directors, including the independent chair, to a Board committee, to the independent directors as a group, or to the Board as a whole, by addressing the communications to the appropriate party and sending them to The Clorox Company, c/o Corporate Secretary, 1221 Broadway, Oakland, CA 94612-1888. The Corporate Secretary will review all communications so addressed and will forward to the addressee(s) all communications determined to bear substantively on the business, management, or governance of the Company.



How We Identify, Evaluate and Nominate Our Directors

The NGCRC engages in continuous Board succession planning and evaluation of Board composition, working closely with our Board in determining the skills, experiences, and characteristics desired for the Board as a whole and for its individual members, and also screening and recommending candidates for nomination by the full Board.

While the Board has not established any specific minimum qualifications that a potential nominee must possess, director candidates, including incumbent directors, are assessed based upon criteria established by the NGCRC in light of the Company’s long-term strategy, the skills and backgrounds currently represented on the Board, and any specific needs identified in the NGCRC’s evaluation of Board composition.

Criteria include:

Broad-based leadership and relevant business skills and experiences
Prominence and reputation in their professions
Global business and social perspective
Ability to effectively represent the long-term interests of our shareholders and other stakeholders
Ability to devote sufficient time to the Company’s affairs
Personal integrity and judgment
Diversity of thought, background and experience

The Board also adopted a Board Diversity Policy during fiscal year 2020, which requires the NGCRC to include, and to have any search firm they engage include, diverse candidates who meet the Board membership criteria set forth in the Governance Guidelines, in any pool from which the NGCRC selects director candidates. See Board Diversity Policy below for more information.

The NGCRC focuses on achieving the right balance of tenure of our directors to obtain a Board with a combination of fresh perspectives and the institutional memory of longer-tenured directors who have seen issues arise over time and have worked with different CEOs and management teams to guide the Company.

The ability of incumbent directors to continue to contribute to the Board and the Company’s evolving needs is also carefully considered in connection with the renominating process. Further, under the Governance Guidelines, non-management directors whose personal circumstances change in a manner that affects their ability to contribute to the Company, including a change in their principal position, primary job responsibilities, or situation, must offer their resignation for the Board’s consideration, to ensure that the individual is still qualified to perform their duties as a director of the Company.



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Director Skills & Experience

The following experience and skills, among others, have been specifically identified by the NGCRC as being important in creating a diverse and well-rounded Board:

Brand-building/marketing/digital/e-commerce experience


Consumer packaged goods or relevant technology knowledge


Cybersecurity/information technology knowledge


Emerging technology/innovation experience


ESG experience (sustainability, social responsibility, public issues expertise)


Experience in product development or supply chain management


Human capital and culture experience


International experience


Operational experience


Regulatory, scientific or R&D experience


Retail/customer experience


Risk Management Oversight


Significant M&A/financial/accounting expertise




Brand Building / Marketing Experience. Organic sales growth is one of our key financial metrics, and directors with experience in developing strategies to grow sales and market share and build brand awareness and equity, in addition to digital and social media and e-commerce experience, provide important perspectives on fueling growth, one of the core strategic choices of our IGNITE strategy.
Consumer Packaged Goods or Relevant Industry Expertise. As a company that relies on the strengths of our branded consumer products, we seek directors who are familiar with the consumer packaged goods and health and wellness industries. They are able to provide guidance on the Company’s strategy and position in our industry, in addition to providing market insights.
Cyber and Data Security Knowledge. Cyber and data security are vital to the Company’s operations, and experience and knowledge in the areas of digital technology, and cybersecurity allow directors to effectively oversee and advise on our risk management programs.
Emerging Technology and Innovation Experience. Directors with technology and innovation experience and knowledge (including digital and social media, e-commerce and the sharing economy) are able to identify and understand emerging technologies; have a deeper perspective on the disruptive forces in our industry; and can support the development and execution of our business strategy, including with respect to innovation.
ESG Experience. Our ESG pillars, which we refreshed in fiscal year 2021, are organized around our most strategic opportunities to make positive societal impact and are integrated with our IGNITE strategy. Accordingly, we seek directors with social responsibility, environmental/climate, sustainability and public issues experience, allowing them to appropriately consider and address business, social and environmental challenges, while also mitigating risks and creating value for all stakeholders.
Experience in Supply Chain Management. Innovation and supply chain management are critical areas for the Company in helping us continue to successfully develop and manufacture products to satisfy consumer demand and preferences.
Human Capital Management and Culture Experience. Experience in attracting, developing and retaining qualified personnel and fostering a corporate culture that reflects our values and encourages inclusion, diversity and performance is especially valuable to Clorox, especially within the context of the highly competitive talent market in which we operate and as we continue to reimagine work, a core strategic choice of our IGNITE strategy.
International Experience. Directors with global experience and perspective help us make key strategic and operational decisions in international markets, and help us market and sell to our diverse consumer base.


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Operational Experience. Directors who have served in senior management roles can contribute insight into strategy and operations, and provide market insights that can help deliver cost savings and fuel growth.
Regulatory, Scientific or Research & Development Experience. We seek directors who have knowledge and experience in navigating regulatory environments both in the U.S. and globally, especially in health and wellness and other relevant regulated sectors.
Retail or Customer Experience. Innovating brand and shopping experiences is another core strategic choice of our IGNITE strategy, and directors with insights on consumer engagement and industry trends will be key in supporting our execution of this strategy.
Risk Management Oversight. Directors with risk management experience guide the Board in executing its responsibility to understand and oversee the various risks facing the Company and ensure there are appropriate mechanisms and policies in place to mitigate and manage those risks.
Significant Mergers and Acquisitions / Strategy Experience and Financial / Accounting Expertise. M&A, partnerships, strategy, accounting and financial reporting experience enable a director to provide perspective on the Company’s strategic transactions and to oversee the Company’s financial reporting and compliance.

Director Continuing Education and New Director Orientation

To enhance and expand on the key skills and experiences relevant to the Company’s industry, we provide our directors with continuing education and presentations developed by both internal and external expert speakers. Additionally, we encourage our directors to participate in external continuing director education programs. New directors also participate in comprehensive orientation sessions that provide them with a thorough understanding of their fiduciary duties as well as a robust overview of the Company’s business and strategies, which allows new directors to begin making contributions to the Board at the start of their service.


Diverse Backgrounds & Experiences

Our director nominees represent diverse perspectives and experiences, and we regularly assess our Board to ensure that we have a mix of tenures balancing fresh perspectives with institutional memory of longer-tenured directors who have seen issues arise over time and have worked with different CEOs and management teams to guide the Company.

4/11 WOMEN* 3/11 PEOPLE OF COLOR** 10/11 INDEPENDENT 5.3 YRS. AVG. TENURE

* The women on our Board are Ms. Banse, Ms. Lee, Ms. Rendle, and Ms. Tesija.
** Dr. Carmona identifies as Hispanic/Latino, Ms. Lee identifies as Asian-American, and Mr. Williams identifies as Black.

As highlighted in our Governance Guidelines, the Board values diversity and recognizes the importance of having unique and complementary backgrounds and perspectives in the boardroom. The Board also actively seeks refreshment of the Board with directors who can add strong and unique value to our ever-evolving business through skills highly relevant to our corporate strategy.

The Board believes that setting the tone at the top – that people of all backgrounds are welcome and empowered – helps the Company attract and retain the best talent and also helps lead to a better business strategy and execution. The Board endeavors to bring together diverse skills, professional experience, perspectives, age, race, ethnicity, gender, sexual identity and orientation, and cultural backgrounds that reflect the Company’s diverse

stakeholders. The NGCRC assesses the effectiveness of these efforts by examining the overall composition of the Board, assessing how individual director candidates, including incumbent directors, can contribute to the overall success of the Board, and reviewing individual, committee, and Board evaluation results. Furthermore, we are very proud that our commitment to diversity does not end with just representation; diverse directors hold key leadership roles on our Board – our NGCRC chair is an Asian woman, and our Audit Committee Chair is Black.

Clorox’s commitment to inclusion and diversity also forms a key part of our IGNITE strategy. As of June 30, 2021, people of color represent 38% of our nonproduction employees and 31% of our nonproduction managers in the US, and women represent 52% of our nonproduction


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employees and 46% of our nonproduction managers globally. We are committed to inclusion and diversity because we fundamentally believe that diversity leads to better outcomes for our business. We have also seen the value of diversity during times of uncertainty when different ways of thinking enables us to be nimble, creative, and step up to meet challenges.

Board Diversity Policy

The Board regards diversity as an important consideration for determining the optimal Board composition and adopted a Board diversity policy during fiscal year 2020, formalizing and reinforcing the NGCRC’s long-existing practice of considering diversity as an important factor in the director selection process in accordance with our Board membership criteria.

The NGCRC has oversight of the implementation and delivery of the Board Diversity Policy, which guides and

helps drive the Board’s commitment to actively seek out diverse director candidates. This policy requires that women and people of color who meet the Board membership criteria set forth in the Company’s Corporate Governance Guidelines (Governance Guidelines) are included in each slate of potential directors the Board considers in director searches. The policy recognizes that in considering director candidates for the Board, the NGCRC considers many forms of diversity, such as, diversity of skills, professional experience, perspective, age, race, ethnicity, gender, sexual identity and orientation and cultural backgrounds, and considers whether the diversity of the Board is appropriately reflective of the diversity of the Company’s stakeholders.

The Board believes this policy supports the Company’s commitment to inclusion and diversity and its ability to adapt to ever-changing business and policy environments.



Board Leadership Structure

As part of our ongoing, proactive efforts to implement effective and progressive corporate governance practices, the NGCRC regularly reviews the leadership structure of the Board, taking into account the Company and its needs, market practices, board skills and experiences, investor feedback, and corporate governance perspectives, among other things. The Board believes it is in the best interests of the Company and its shareholders for the Board to have flexibility in determining the Board leadership structure of the Company based on these factors. Accordingly, over the years, the Board has had a variety of leadership structures.

In February 2021, our executive chair and former CEO Benno Dorer stepped down from his role, and Matthew Shattock was appointed to the role of independent chair. Mr. Shattock brings strong board and executive leadership experience to the role having previously served as a non-executive board chair and as a former public company CEO. Mr. Shattock leads the Board in its fundamental role of advising and overseeing management.

In this role, the independent chair:

presides at all meetings of the Board and all executive sessions of independent directors;
has the authority to call additional meetings of the independent directors;
reviews and approves Board meeting materials and advises the CEO and other members of management accordingly;
reviews and approves meeting agendas and schedules to ensure sufficient time for discussion of all agenda items;
is available for consultation and direct communication with major shareholders, if requested; and
monitors and evaluates the CEO’s performance, along with the members of the MDCC and the other independent directors.

As CEO, Ms. Rendle is responsible for developing and overseeing the Company’s business strategy and culture as well as managing the day-to-day operations of the Company and the Company’s relationships with stakeholders.

Lastly, the Board is guided by strong, independent committee chairs, with Ms. Lee leading the NGCRC, Mr. Fleischer leading the MDCC, and Mr. Williams serving as the Audit Committee chair.

Other than Ms. Rendle, all of the Company’s directors are “independent” as defined by the NYSE rules. The Board believes that this structure promotes effective governance and that the leadership structure described above is in the best interests of the Company and its shareholders, in light of current circumstances.



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Annual Board and Director Evaluation Process

In addition to regularly reviewing its leadership structure, the Board, the Board committees and each individual director conduct an annual self-assessment of their performance, a process that is overseen by the NGCRC.

The NGCRC chair meets with each director to gather feedback on the Board and to discuss each director’s self-assessment and peer evaluation. Directors have the opportunity to provide feedback on a number of issues designed to assess Board performance, including Board composition, structure, information received, accountability, oversight, and effectiveness, among other topics. The NGCRC chair then summarizes the results and any related recommendations, and the Board reviews and discusses the findings. Each Board committee also conducts a separate self-evaluation that is designed to assess committee performance and effectiveness.

This multi-step evaluation process generates robust comments and discussion at all levels of the Board, and these evaluations have led to changes designed to increase Board effectiveness and efficiency, including, for example:

Adjusting the Board meeting format to facilitate continued deep engagement on key strategic areas;

Providing further information between Board meetings to share Company, people and industry updates;
Adding regular cyber and data security updates to each quarterly Audit Committee meeting agenda many years ago;
Adding new topics or devoting more time to particular topics and businesses of interest;
Incorporating external speakers when helpful and appropriate;
Meeting with high potential employees below the executive level to develop relationships and become familiar with the potential internal management succession pipeline;
Revising the format and focus of Board materials;
Adding periodic updates that continue focusing on digital engagement and corporate development topics; and
Identifying the skills and expertise desired for future director candidates.



Vote Required

The Company’s Bylaws require each director to be elected by a majority of the votes cast with respect to such director in uncontested elections—the number of shares voted FOR a director must exceed the number of shares voted AGAINST that director.

The people designated in the proxy and voting instruction card intend to vote your shares represented by proxy FOR the election of each of these nominees, unless you include instructions to the contrary. In the event any director nominee is unable to serve or for good cause will not serve, the persons named as proxies may vote for a substitute nominee recommended by the Board, or the Board may reduce the size of the Board or leave a vacancy.

Under the Company’s Bylaws, any director who fails to be elected by a majority of the votes cast in an uncontested election must tender their resignation to the Board. The NGCRC would then make a recommendation to the Board as to whether to accept or reject the resignation, or whether other action should be taken. The Board would act on the NGCRC’s recommendation and publicly disclose its decision and the rationale behind it within 90 days from the date the election results are certified. A director who tenders their resignation would not participate in the Board’s decision.



Board’s Recommendation

The Board unanimously recommends a vote FOR each of the Board’s 11 nominees for director listed above. The Board believes that each nominee listed above is highly qualified and has the background, skills, experience, and attributes that qualify each nominee to serve as a director of the Company. See each nominee’s biographical information and the

How We Identify, Evaluate and Nominate our Directors section above for more information. The Board’s recommendation is based on its carefully considered judgment that the background, skills, experience, and attributes of the nominees make them the best candidates to serve on the Board.


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How Our Directors Govern

The Clorox Company Governance Guidelines

The Board has adopted Governance Guidelines to reflect the Board’s views and the Company’s policies regarding significant corporate governance matters, which the Board believes are best practice. The Governance Guidelines present a framework for the governance of the Company by setting forth the Board’s and the Board committees’ responsibilities, qualifications, and operational matters and describing key matters. The NGCRC reviews the Governance Guidelines on an annual basis and recommends changes to the Board based on current corporate governance best practices.

The Governance Guidelines can be found in the Corporate Governance section on the Company’s website at https://www.thecloroxcompany.com/who-we-are/ corporate-governance/governance-guidelines/, and are available in print to any shareholder who requests them from The Clorox Company, c/o Corporate Secretary, 1221 Broadway, Oakland, CA 94612-1888.

Our Corporate Governance Process

We believe that a critical component of meaningful corporate governance is a robust annual process that includes active and transparent shareholder engagement.

Our annual engagement process typically includes the following:

Meeting with many large investors to seek feedback on ESG topics, with our independent chair, NGCRC chair and CEO participating in some of these meetings
Director assessment of board and committee composition and succession
Publication of proxy statement and integrated annual report
Annual director self-assessment process. The chair of the NGCRC meets with each director to receive feedback on the Board´s performance and to discuss each director´s self-assessment and peer evaluation.
Hosting shareholders (virtually or in person) at our annual meeting of shareholders
Board review of key governance policies
Annual committee self-assessment process
Multi-day Board strategy meeting, focusing on talent, diversity, succession planning, ESG strategy and enterprise risks
In addition to our regularly scheduled governance cadence described below, our Board reviews, considers, and acts, as necessary, upon ESG matters throughout the year.

The Board’s Role in Risk Management and Culture Oversight

While the Company’s management is responsible for the day-to-day risk management process, the Board has ultimate responsibility for the oversight of the Company’s risk management, shaping effective corporate governance, and setting the right tone for integrity, ethics and culture, including matters around inclusion and diversity. The Board exercises direct oversight of strategic risks to the Company and the risk management process to ensure that it is properly designed, well-functioning and consistent with our overall corporate strategy, and also delegates certain risk areas to each of the Board committees, as further described below.

Enterprise Risk Management. The Company has instituted a robust, comprehensive enterprise risk management program, which involves Board oversight, and an Enterprise Risk Management Steering Committee (ERM Committee), which consists of a cross-functional team of senior leaders and key executives. The ERM Committee oversees the annual key risk identification process, which identifies the top risks that the Company faces with respect to its business, operations, strategy, and other factors, including cybersecurity and climate-related risks, as well as key mitigation strategies and risk owners. Our management reports and discusses identified risks and risk mitigation and management efforts with the Board, at minimum, on an annual basis and typically in connection with the Board’s annual strategy meeting.

Cybersecurity Risk Management and Preparedness. The Company’s cyber preparedness team, led by our chief information and enterprise analytics officer and overseen by our information security officer, leverages various frameworks from the National Institute of Standards and Technology (NIST) for managing cybersecurity risks and seeks to employ cybersecurity best practices, including implementing new technologies to proactively monitor new vulnerabilities and reduce risk, enhancing governance, risk and compliance management, maintaining security policies and standards, continuously updating our response planning and protocols, and has a cybersecurity insurance policy in place. Additionally, the Company’s internal audit function performs a cybersecurity program maturity assessment every two years and conducts regular phishing and cyber hygiene training of all of its employees that have access to company email and connected devices.


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Additionally, our chief information and enterprise analytics officer, information security officer and chief legal officer report to the Audit Committee regularly, and at least quarterly, on topics related to information security and cyber risks and readiness. Additional information security and cybersecurity risks are presented to the full Board at least annually as part of the full Board’s oversight of enterprise risk management. The Audit Committee includes directors with knowledge, skills and experience in security, privacy, IT governance, and cyber risk, and management consults regularly with external specialists and advisors on enhancements and opportunities for regular and continued strengthening of our cyber practices and policies.

ESG Matters. Although the NGCRC has oversight over ESG matters, the Board also reviews ESG issues, as it has a standing agenda item at each quarterly meeting to hear from the key executives that have oversight of these matters. This review and discussion of ESG initiatives, challenges and opportunities, in addition to priorities and progress fosters appropriate Board oversight of ESG matters.

Culture. In overseeing culture, the Board also receives information through a number of channels, including updates from the chief people officer and the vice president for inclusion and diversity on data and metrics from periodic pulse surveys, our annual employee engagement survey which gauges employee perception of the Company as a place to work as well as their sense of inclusion, as well as the activities of our employee resource groups. The chief legal officer also updates the Board on any significant compliance, discrimination and harassment complaints.

Reporting Protocol. The Company also has formalized governance structure and reporting channel policies that require management to notify the Board of, among other things, any instances of significant threatened or actual litigation, significant governmental or regulatory inquiry or proceeding, and any events or occurrences that could materially impact the Company’s reputation, including any cybersecurity-related issues that could involve the significant misappropriation of personal or sensitive/valuable Company data, or that may have significant operational, financial, legal or reputational impacts.

Risk Oversight by Board Committees

As part of executing its risk oversight responsibility, the Board delegates specific oversight duties to each Board committee based on expertise, as set forth below. These committees report on risk exposure on these delegated areas during its regular reports to the full Board to facilitate proper risk oversight by the full Board.

Audit Committee

Integrity of the financial statements
Accounting and financial reporting matters and controls, including independent and internal auditors
Risk management policies and compliance relating to accounting and financial reporting matters
Information security risk profile, including cybersecurity and data privacy, and information security program
Quarterly cyber and data security updates from our chief information and enterprise analytics officer and chief security officer

NGCRC

Corporate governance practices, director nominations, Board, committee, director and peer evaluations
ESG issues, including corporate responsibility, sustainability and political contribution matters
Compliance and ethics program

MDCC

Management development, retention and succession planning processes
Compensation for executive officers and various benefit plans for the Company as a whole to offer performance incentives while discouraging excessive risk-taking

Executive Compensation

The MDCC periodically reviews the Company’s compensation policies and programs to ensure that compensation offers performance incentives to employees and executives, while mitigating excessive risk-taking. The overall executive compensation program contains various provisions that mitigate against excessive risk-taking, including:

Balancing cash compensation under the Company's Annual Incentive Plan (AIP) and equity compensation;
Capping the payouts under our incentive plans, which protect against executives taking short-term actions to maximize bonuses that are not supportive of long-term objectives;
Utilizing weighted financial metrics under the Annual Incentive Plan that are intended to discourage revenue generation at the expense of profitability and profitable growth, and vice versa;
Using different financial metrics under our Annual Incentive Plan and long-term performance shares;


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Including clawback provisions that allow the recapture of compensation paid to current and former executives, including in the event of a restatement of the Company’s financial statements or if the individual engages in conduct materially detrimental to the Company, which serve as a deterrent to inappropriate risk-taking activities; and
Implementing and enforcing stock ownership guidelines that require executive officers to accumulate meaningful levels of equity ownership in the Company, which align executives’ short- and long-term interests with those of the Company’s shareholders.

Based on its review and the analysis provided by its independent compensation consultant, Frederic W. Cook & Co., Inc. (FW Cook), the MDCC has determined that the risks arising from the Company’s compensation policies and practices for its employees, including executive officers, are not reasonably likely to have a material adverse effect on the Company.

Board Meeting Attendance

The Board held eight meetings during fiscal year 2021. All incumbent directors attended at least 75% of the meetings of the Board and committees of which they were members during fiscal year 2021 during the period in which they served on the Board. All members of the Board are expected to attend the Annual Meeting. Each of the 12 members of the Board at the time of the Company’s 2020 Annual Meeting of Shareholders attended that meeting.

Director Independence

The Governance Guidelines provide that a substantial majority of the Board must consist of independent directors. The Board determines whether individual

Board members are independent, as defined by the New York Stock Exchange (NYSE). The Board has adopted director independence standards, which are set forth in the Governance Guidelines, to assist it in assessing the independence of directors. The Board makes an affirmative determination regarding the independence of each director annually, based upon the recommendation of the NGCRC.

The Board has determined that each of our directors (Messrs. Fleischer, Mackay, Parker, Shattock, Weiner, and Williams, Mmes. Banse, Lee, and Tesija, and Dr. Carmona) are independent under the NYSE listing standards and the independence standards set forth in the Governance Guidelines, except for Ms. Rendle since she is an employee of the Company. The Board considered the impact of tenure on a director’s independence, particularly with respect to directors with 10 or more years of Board service, and the Board concluded that such longer-tenured directors have demonstrated their independence from management, based on their communications and interactions with management, their decisions, and their adherence to their fiduciary duties to shareholders.

The independent directors generally meet in executive session at each regularly scheduled Board meeting without the presence of management directors or employees of the Company to discuss various matters related to the oversight of the Company, the management of the Board’s affairs, and the CEO’s performance. The independent chair presides over the independent executive sessions.



Related Person Transaction and Conflict of Interest Policies and Procedures

The Company has a written policy regarding review and approval of any Interested Transactions (as defined below) by the Audit Committee. An “Interested Transaction” is any transaction, arrangement, or relationship or series of similar transactions, arrangements, or relationships (including any debt or guarantee of debt) in which:

the aggregate amount will or may be expected to exceed $120,000,
the Company or any of its subsidiaries is a participant, and

any executive officer, director or director nominee; beneficial owner of 5% or more of our stock; or any immediate family member of the foregoing individuals (Related Person) has or will have an interest (other than solely as a result of being a director or a less than 10% beneficial owner of an equity interest in another entity).

The policy also contains categories of preapproved transactions that the Board has identified as not having a significant potential for an actual or potential conflict of interest or improper benefit.


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In reviewing any Interested Transaction, the Audit Committee will consider whether the Interested Transaction is on terms no less favorable than terms generally available to an unaffiliated third party under the same or similar circumstances and the extent of the Related Person’s interest in the transaction. There have been no transactions considered to be an Interested Transaction since the beginning of the Company’s 2020 fiscal year.

Additionally, the Company’s Code of Conduct has a detailed provision prohibiting its directors, officers, and employees from entering into transactions that are an actual or potential conflict of interest and is available on the Company’s website at https://www.thecloroxcompany.com/who-we-are/ corporate-governance/codes-of-conduct.



Code of Conduct

The Company has adopted a Code of Conduct, which sets forth the ethical and legal standards of behavior and business practices that are required of all our directors, executives and global employees and can be found in the Corporate Governance section of the Company’s website, https://www.thecloroxcompany.com/who-we-are/corporate-governance/codes-of-conduct, or can be obtained in print by contacting The Clorox Company, c/o Corporate Secretary, 1221 Broadway, Oakland, CA 94612-1888.

We require that all Board members and employees complete training and certify compliance with the Code of Conduct annually. We also perform an annual audit of internal compliance with our Code of Conduct.

We also have established a separate Business Partner Code of Conduct outlining our standards and expectations of our suppliers and other business partners, which can also be found at https://www. thecloroxcompany.com/who-we-are/corporate-governance/codes-of-conduct.



Board Committees

The Board has established three standing committees: the Audit Committee, the NGCRC, and the MDCC. Each of these committees consists only of non-management directors whom the Board has determined are independent under the NYSE listing standards and the Board’s independence standards set forth in the Company’s Governance Guidelines. Directors who serve on the Audit Committee and the MDCC must meet additional, heightened independence and

qualification criteria applicable to directors serving on these committees under the NYSE listing standards. The charters for these committees are available in the Corporate Governance section of the Company’s website at https://www.thecloroxcompany.com/who-we-are/ corporate-governance/committee-charters, or in print by contacting The Clorox Company, c/o Corporate Secretary, 1221 Broadway, Oakland, CA 94612-1888.


The table below indicates the current members of each standing Board committee as of the date of the Annual Meeting:

Director Audit         NGCRC         MDCC
Amy Banse
Richard H. Carmona
Spencer C. Fleischer Chair
Esther Lee Chair
A.D. David Mackay
Paul Parker
Linda Rendle
Matthew J. Shattock
Kathryn Tesija
Russell J. Weiner
Christopher J. Williams Chair
Number of meetings in fiscal year 2021 10 5 7

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Audit Committee. The Audit Committee is the principal link between the Board and the Company’s independent registered public accounting firm. The Audit Committee has the functions and duties set forth in its charter, including:

representing and assisting the Board in overseeing:
the integrity of the Company’s financial statements;
the independent registered public accounting firm’s qualifications, independence, and performance;
the performance of the Company’s internal audit function and independent registered public accounting firm;
the Company’s systems of disclosure controls and procedures and internal control over financial reporting that management has established;
the Company’s compliance with legal and regulatory requirements relating to accounting and financial reporting matters;
the Company’s framework and guidelines with respect to risk assessment and risk management; and
the Company’s material financial policies and actions.
preparing the report required by the SEC proxy rules to be included in the Company’s annual proxy statement.

The Board has determined that, with respect to fiscal year 2021, director Mr. Williams is an audit committee financial expert, as defined by SEC rules, and each member of the Audit Committee is financially literate, as defined by NYSE rules.

Nominating, Governance and Corporate Responsibility Committee. The NGCRC has the functions and duties set forth in its charter, including:

identifying and recruiting individuals qualified to become Board members and recruiting them for membership on the Board;
recommending to the Board individuals to be selected as director nominees for the annual meeting of shareholders and any individuals to be elected by the Board between annual meetings;
reviewing and recommending to the Board changes in the Governance Guidelines and the Code of Conduct;
overseeing the Company’s ethics and compliance program, including the Company’s compliance with legal and regulatory requirements relating to matters other than accounting and financial reporting matters;
performing a leadership role in shaping the Company’s corporate governance and overseeing the evaluation of the Board and its committees;
assisting the Board in overseeing the Company’s corporate responsibility and sustainability program; and
assisting the Board in overseeing the Company’s engagement efforts with shareholders and other key stakeholders.

Management Development and Compensation Committee. The MDCC has the functions and duties set forth in its charter, including:

assisting the Board in discharging its responsibilities relating to compensation of the CEO and other executive officers;
reviewing and approving the Company’s compensation policies, plans and goals and objectives for the executive officers and directors;
overseeing the Company’s management development succession planning processes; and
evaluating, making recommendations and taking appropriate action in response to the shareholders’ advisory “say on pay” vote.



How Our Directors Are Paid

Only our non-employee directors receive compensation for their service as directors. The Company’s non-employee director compensation program is comprised of cash compensation and an annual grant of deferred stock units.

The MDCC has the responsibility for making recommendations regarding non-employee director compensation. The MDCC reviews the form and amount of compensation of non-employee directors at least once a year to ensure that the Company’s non-employee directors are compensated appropriately relative to peer companies. The MDCC retains the services of an independent compensation consulting firm to assist

it in the performance of its duties. During fiscal year 2021, the MDCC used the services of Frederic W. Cook & Co., Inc. (FW Cook). FW Cook’s work with the MDCC included data analysis and guidance and recommendations regarding compensation levels relative to our compensation peer group (see discussion regarding the peer group in the Compensation Discussion and Analysis section below) as well as trends and recent developments in the area of non-employee director compensation. Clorox generally aims to compensate non-employee directors at or near the median of the compensation peer group.


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The following table sets forth information regarding compensation for each of the Company’s non-employee directors during fiscal year 2021.

Name       Fees Earned
or Paid in Cash
($)(2)
      Stock
Awards
($)(3)
      Total
($)
Amy Banse 103,000 157,000 260,000
Richard H. Carmona 112,375 157,000 269,375
Spencer C. Fleischer 123,000 157,000 280,000
Esther Lee 108,625 157,000 265,625
A. D. David Mackay 103,000 157,000 260,000
Robert W. Matschullat(1) 39,185 39,250 78,435
Paul Parker 63,815 78,500 142,315
Matthew J. Shattock 168,625 157,000 325,625
Kathryn Tesija 103,000 157,000 260,000
Pamela Thomas-Graham 134,250 157,000 291,250
Russell J. Weiner 103,000 157,000 260,000
Christopher J. Williams 128,000 157,000 285,000
(1) Mr. Matschullat retired from the Board effective November 18, 2020.
(2) The amounts reported in the Fees Earned or Paid in Cash column reflect the total annual cash retainer and other cash compensation earned by each director in fiscal year 2021 and include amounts deferred into cash or deferred stock units and/or amounts issued in common stock in lieu of cash, as elected by the director. The annual cash retainer is paid to each director in quarterly installments.
(3) The amounts reported reflect the grant-date fair value for financial statement reporting purposes of the annual grant of deferred stock units. Deferred stock units are shares of the Company’s common stock that the director receives only upon terminating their service with the Company. Awards are granted on an annual basis at the end of each calendar year. Refer to Note 14 of the Consolidated Financial Statements contained in our Annual Report on Form 10-K for the fiscal year ended June 30, 2021, for a discussion of the relevant assumptions used in calculating the grant-date fair value under applicable accounting guidance. As of June 30, 2021, the following directors had the indicated aggregate number of deferred stock units accumulated in their deferred accounts for all years of service as a director, which includes deferrals of cash compensation used to acquire deferred stock units, annual awards of deferred stock units made by the Company, and additional deferred stock units credited as a result of dividend equivalents earned with respect to the deferred stock units: Ms. Banse – 4,295; Dr. Carmona – 23,147; Mr. Fleischer – 9,560; Ms. Lee – 8,250; Mr. Mackay – 4,295 units; Mr. Matschullat – 64,647; Mr. Shattock – 4,220; Ms. Tesija – 982; Ms. Thomas-Graham – 27,705; Mr. Weiner – 6,638; and Mr. Williams – 10,425.

Cash Compensation

Directors receive cash compensation, which consists of annual cash retainer amounts and any special assignment fees. The following table lists the various retainers paid for Board service and service in the positions set forth below during fiscal year 2021.

Annual director retainer       $103,000
Independent chair retainer 175,000
Lead independent director retainer 50,000
Committee chair retainers:
Nominating, Governance and Corporate Responsibility Committee 15,000
Audit Committee 25,000
Management Development and Compensation Committee 20,000

Directors who serve as a Board member, independent chair, lead independent director, or committee chair for less than the full fiscal year receive pro-rated retainer amounts based on the number of days they served in such position during the fiscal year. In fiscal year 2021, Matthew Shattock began receiving a retainer for his service as independent chair, and Pamela Thomas-Graham stopped receiving a retainer for her service as lead independent director, beginning on February 15, 2021. In addition to the retainer amounts, each non-

employee director is entitled to receive a fee of $2,500 per day for any special assignment requested by the Board. No special assignment fees were paid in fiscal year 2021.

Payment Elections. Under the Company’s Independent Directors’ Deferred Compensation Plan, a director may annually elect to receive all or a portion of their cash compensation in the form of cash, common stock, deferred cash, or deferred stock units.


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Payment in Stock. Directors who elect to receive cash compensation amounts in the form of common stock are issued shares of common stock based on the fair market value of the common stock as determined by the closing price of the common stock on the last trading day of the quarter for which the fees were earned.

Elective Deferral Program: Deferred Cash. For directors who elect deferred cash, the amount deferred is credited to an unfunded cash account that is credited with interest at an annual interest rate equal to Wells Fargo Bank, N.A.’s prime lending rate in effect on January 1 of each year. Upon termination of service as a director, the amounts credited to the director’s deferred cash account are paid out in five annual cash installments or in one lump-sum cash payment, as elected by the director.

Elective Deferral Program: Deferred Stock Units. For directors who elect deferred stock units, the amount deferred is credited to an unfunded account in the form of units equivalent to the fair market value of the common stock on the last trading day of the quarter for which the fees were earned. When dividends are declared, additional deferred stock units are allocated to the director’s deferred stock unit account in amounts equivalent to the dollar amount of common stock dividends paid by the Company divided by the fair market value of the common stock on the date the dividends are paid. Upon termination of service as a director, the amounts credited to the deferred stock unit account, which include any elective deferrals and the annual deferred stock unit grants described above, are paid out in shares of common stock in five annual installments or in one lump sum, as elected by the director. Deferred stock units may only be settled in shares of common stock.

Equity Compensation

Each non-employee director receives a majority of their annual compensation in the form of deferred stock units. Deferred stock units are shares of the Company’s common stock that the director receives only upon terminating their service with the Company. Each non-employee director receives an annual grant of deferred stock units. The aggregate value of the deferred stock unit award amount earned by a non-employee director serving for the full fiscal year 2021 was $157,000. Awards are made as of the last business day in the calendar year and represent payment for services provided during such calendar year.

The Company believes that the use of deferred stock units provides a stronger alignment between directors and the Company’s shareholders compared to outright stock ownership since directors have no ability to sell the deferred stock units while they remain on the Board. The Company has maintained the deferred stock unit program for its directors for over 20 years.

Directors who serve as non-employee Board members for less than the full calendar year receive pro-rated awards based on the number of full fiscal quarters they served as a non-employee Board member during the calendar year. Deferred stock units accrue dividend equivalents, and the balance of a director’s deferred stock unit account is paid out in common stock only following the director’s termination of service, as described in greater detail under Payment Elections above.

Fiscal Year 2022 Compensation Changes

As discussed above, the MDCC reviews the form and amount of compensation of non-employee directors at least once a year to ensure that the Company’s non-employee directors are being compensated appropriately relative to peer companies. The MDCC again reviewed non-employee director compensation in September 2021. As part of its review, the MDCC considered the data provided by FW Cook as well as its guidance and recommendations regarding compensation levels relative to our compensation peer group as well as trends and recent developments in the area of non-employee director compensation. After taking all of this information into account, the MDCC recommended, and the Board agreed, not to increase director compensation or make other changes to the director compensation program. In addition, if approved by the shareholders (see Proposal 4: Approval of Amended and Restated 2005 Stock Incentive Plan of this proxy statement), the amended and restated SIP will cap the cash and equity compensation payable in a fiscal year to each of our non-employee directors.

Stock Ownership Philosophy and Guidelines for Directors

The Board believes that the alignment of directors’ interests with those of shareholders is strengthened when Board members are also shareholders. The Board therefore requires that each non-employee director, within five years of first being elected, own common stock or deferred stock units that are settled only in common stock having a market value of at least five times their annual cash retainer. This program is designed to ensure that directors acquire a meaningful and significant ownership interest in the Company during their tenure on the Board. Furthermore, as directors must hold the deferred stock units until termination of their service on the Board, they have aligned interests and appropriate incentives to promote long-term value for shareholders during their service as a director. As of August 31, 2021, each non-employee director was in compliance with the guidelines, and in fact, the majority of our directors held common stock or deferred stock units with value far in excess of this amount.


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Our Company

Clorox is a leading multinational manufacturer and marketer of consumer and professional products with fiscal year 2021 net sales of $7.3 billion and about 9,000 employees worldwide as of June 30, 2021. Clorox sells its products primarily through mass retailers; grocery outlets; warehouse clubs; dollar stores; home hardware centers; drug, pet stores, and military stores; third-party and owned e-commerce channels; and distributors. Clorox markets some of the most trusted and recognized consumer brand names, including its namesake bleach and cleaning products; Pine-Sol® cleaners; Liquid-Plumr® clog removers; Poett® home care products; Fresh Step® cat litter; Glad® bags and wraps; Kingsford® grilling products; Hidden Valley® dressings, dips, seasonings and sauces; Brita® water-filtration systems and filters; Burt’s Bees® natural personal care products; and RenewLife®, Rainbow Light®, Natural Vitality® and NeoCell® vitamins, minerals and supplements. The Company also markets industry-leading products and technologies for professional customers, including those sold under the CloroxPro™ and Clorox Healthcare® brand names. More than 80% of the Company’s sales are generated from brands that hold the No. 1 or No. 2 market share positions in their categories. The Company was founded in Oakland, California, in 1913 and is incorporated in Delaware.


Our Purpose and Values

Purpose

As a health and wellness company at heart, our purpose — we champion people to be well and thrive every single day — reflects our belief that we make a meaningful and positive impact on the world around us.

Championing people starts with the health and safety of our employees. It means building workplace culture that celebrates diversity and enables everyone to stretch, grow and do their best work. We have built a culture where everyone can bring their authentic, whole self to work every day.

Championing people to be well and thrive applies to the consumers we serve. Our products make the world around us and the spaces inside and outside our homes healthier, cleaner and safer. They strengthen bodies and minds, and help people care for themselves and the people and pets they love. Our brands bring people together and make life a little more joyful. It’s why people love us. When our consumers are well and thriving, we are.

Our purpose drives us to champion the people in our communities. It’s why we’re committed to bringing our communities together, to raise them up by supporting equality, equal opportunity and equal justice. And we want to make the planet healthier for everyone, in every corner of the world, with clean air, pure water, and unpolluted places where we live, work and play.

Values

As a company, we are guided by beliefs that represent who we are, how we conduct our business, and our expectations for our people and business partners. Our values also reinforce our focus on delivering growth and inform how we treat and care for our employees.

Do the Right Thing. It’s bigger than any one of us, yet it starts with each of us. We lead with integrity, and we earn trust – in every moment and with every choice. We are hungry to grow our business and believe that winning only counts if it’s done in the right way.

Put People at the Center. We genuinely care about people. So, we understand the impact of our words and actions and feel a responsibility to deliver for our consumers, customers, teammates and communities. We meet our commitments, put health and safety first, and strive for a just and inclusive world.

Play to Win. We set the pace for growth in each of our categories. We reimagine the game and are each hungry to do more, think bigger, and execute better. It feels like a punch to the gut when we lose. We have high aspirations and the grit to take on big challenges, so we move forward together with courage and resilience in the face of obstacles.


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Our Company


Fiscal Year 2021 Performance

In fiscal year 2021, Clorox delivered net sales growth of 9% in a macroeconomic environment that continued to be dominated by elevated demand for essential household products, especially cleaning and disinfecting products, as a result of COVID-19. Diluted net earnings per share decreased by 24% in a challenging environment that included high levels of competition in select categories and macroeconomic factors relating to supply challenges, uncertainty related to the global pandemic, persistently high manufacturing and logistics costs, and rising commodity costs.

Our focus on taking care of our employees, consumers and other stakeholders continued to earn us high marks among rankings and ratings organizations in fiscal year 2021. We were included on Barron’s Most Sustainable Companies list, 2021 Bloomberg Gender-Equality Index, the Human Rights Campaign’s 2021 Corporate Equality Index and the 2021 Parity.org Best Places for Women to Advance list, among others.



IGNITE Strategy Guided by ESG Principles

Our IGNITE strategy has the objective of maximizing economic profit while maintaining a commitment to purpose-driven growth. Under IGNITE, we laid out four strategic choices integrated with our ESG goals to sustain that growth. Regardless of the forces impacting our business – such as the global pandemic, shifting consumer preferences, or changing economic conditions – our IGNITE strategy guides our decision-making and allows us to make the right choices that will position us for success over the long term.

IGNITE Strategic Choices

IGNITE is centered around four strategic choices and integrated ESG pillars, which are intended to collectively drive purpose-driven growth.

Fuel Growth
Innovate Experiences
Reimagine Work
Evolve Portfolio

More information regarding these strategic choices is available at https://www.thecloroxcompany.com/company/ignite-strategy/.

We measure achievement against our IGNITE strategy and ESG goals through a scorecard of metrics overseen by the Board, which is updated annually to reflect progress to date and near-term areas of focus. The IGNITE scorecard highlights progress toward objectives that support our IGNITE strategy at each Board meeting and provides a balanced picture of accomplishments and areas of opportunity.

IGNITE ESG Pillars

Our ESG pillars are organized around our most strategic opportunities in order to make a positive societal impact. Refreshed in fiscal year 2021, these pillars—Healthy Lives, Clean World and Thriving Communities—are supported by a foundation of Strong Governance. They are integrated with the four strategic choices described above to guide the Company in pursuing innovative ways to meet consumer needs, address some of the planet’s most pressing environmental challenges and society’s pervasive inequities, and create value for all stakeholders.


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Our Company

Healthy Lives: Improving people’s health and well-being.

Employee health and well-being. Putting people at the center of everything we do starts with keeping our employees safe and investing in their total well-being. In fiscal year 2021, we continued to support our employees through programs to promote occupational safety and physical, mental and financial health and well-being. In fiscal year 2021, our recordable incident rate was 0.26, which is significantly lower than the 3.3 average for U.S. manufacturing companies and our goal of less than 1.0.

Ingredient management. We know consumers care about what is in their products – and what is not in their products. In December 2020, we publicly disclosed a restricted substances list (RSL) for our domestic retail cleaning products and committed to disclosing restricted substances information for additional products by the end of fiscal year 2022.

Clean World: Taking climate action and reducing plastic and other waste.

Virgin packaging reduction. As of the end of calendar year 2020, we achieved a combined reduction in virgin plastic and fiber packaging of 21% compared to our goal of 50% by 2030. The reduction was due primarily to the transitioning of Glad products to 100% post-consumer recycled cartons and selling more cleaning products with less packaging.

Zero waste to landfill. 44% of our plants are currently zero waste to landfill, with a goal of 100% of global plants achieving zero-waste-to-landfill status by 2025 and 100% of global facilities by 2030.

Renewable energy. As part of our IGNITE strategy, we committed to achieving 100% renewable electricity in our operations in the US and in Canada, which we achieved in January 2021.

Greenhouse gas emission reduction. We have set science-based targets for reducing greenhouse gases – approved by the Science Based Targets initiative (SBTi) – and committed to achieving net zero emissions by 2050. By 2030, we aim to reduce emissions across our operations (Scopes 1 and 2) by 50 percent and reduce value chain emissions (Scope 3) from purchased goods and services and use of sold products by 25 percent, all on an absolute basis against a 2020 baseline. Our Scopes 1 and 2 targets are consistent with reductions required to keep warming to 1.5 degrees Celsius, the most ambitious goal of the Paris Agreement. Our Scope 3 target meets the SBTi’s criteria for ambitious value chain goals, meaning they are in line with current best practice.

Sustainability reporting. As part of our commitment to trust and transparency, in our integrated annual report we have chosen to report our ESG performance in alignment with voluntary frameworks and standards – namely, the Sustainability Accounting Standards Board (SASB), Task Force on Climate-Related Financial Disclosures (TCFD), the United Nations Sustainable Development Goals (SDGs) and the United Nations Global Compact’s (UNGC) Ten Principles.


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Table of Contents

Our Company

Thriving Communities: Investing in our people and communities to contribute to a more equitable world.

Inclusion and diversity. One of our corporate values is to put people at the center. We understand that our people are critical to our efforts to drive growth and deliver value for shareholders. One of the ways we put people at the center is by continuing to work toward a more inclusive and diverse workplace where each person feels respected, valued and seen and can be the best version of themselves – from women and people of color to LGBTQ+ and veterans, among others. We believe that fostering diversity at all levels of the organization is the right thing to do and also ultimately helps us better address consumer needs.

We took a number of proactive steps in fiscal year 2021 to achieve greater diversity and inclusive leadership among our global workforce. For example, we continued to expand our unconscious bias education to better recognize, acknowledge and minimize any potential blind spots we each may have. Our neuroscience-backed “Breaking Bias” and “Courageous Conversations” programming aims, collectively, to lessen the influence of bias in order to consider diverse perspectives and make better people- and business-related decisions, and also to equip our employees with practical tools for difficult conversations and managing conflict while building trust and putting people at the center of everything we do.

Our board and executive committee are also highly diverse by race, ethnicity, gender and other protected categories. Our CEO is one of only 41 women serving in that role among the Fortune 500, and two of our three Board committee chairs are people of color. As of the Annual Meeting date, women comprise 36% of our director nominees and 46% of our executive committee, and 27% of our director nominees and 23% of our executive committee are people of color. Two of our executive committee members openly identify as LGBTQ.

Our approximately 9,000 employees come from diverse backgrounds – as of June 30, 2021, 31% of our nonproduction managers and 38% of our nonproduction employees in the U.S. are people of color, and globally 46% of our nonproduction managers and over half of our nonproduction employees are women. In 2021, Clorox was named

to Parity.org’s Best Companies for Women to Advance list and Diversity MBA magazine’s 50 Out Front list of the Best Places for Women and Diverse Managers to Work.

As part of our continued commitment to transparency and progress in our inclusion and diversity efforts, in 2020, we published EEO-1 data in our annual report, and this year, we have shared this data, along with our latest EEO-1 report that we submitted to the EEOC. This EEO-1 information is available on the Company’s website at https://www.thecloroxcompany.com. We also disclose representation by Clorox job category over a three-year period in our 2021 Integrated Annual Report.

Employee engagement. We have implemented an ongoing listening strategy that includes an annual engagement survey and periodic pulse surveys. During fiscal year 2021, we again had high employee engagement – 87% of our employees reported that they have pride in the Company, intend to stay, get intrinsic motivation from their work and would refer to the Company as a good place to work, putting us at the top quartile for Fortune 500 companies according to our engagement survey provider Perceptyx.

Community investment. During fiscal year 2021, Clorox donated approximately $20 million foundation and corporate cash grants, U.S. product donations, and U.S. cause marketing, supporting COVID-19 relief, racial justice initiatives and community building where we have facilities and our employees live and work.

Standing up for justice. As the U.S. experienced social upheaval in 2020, we made a number of commitments to create a more just and inclusive world. In fiscal year 2021, we delivered on those commitments and more, including $2.5 million in grants focusing on racial justice, with a focus on Oakland and Atlanta, where we have the most employees. We have also developed guidelines to determine when and how we speak out as a company on social issues, in consultation with our Board and senior management. It is important to us that when Clorox or our brands choose to take a public stance on a social issue, it demonstrates one of our values, Do the Right Thing, is undertaken with our strategic goals in mind and is impactful to our business interests.


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Our Company

Strong Governance: Enhancing our leadership in ESG through an unwavering commitment to strong corporate governance and ESG performance overseen by the Board.

The NGCRC has primary responsibility for oversight of ESG matters, although many ESG matters are reviewed by the full Board.
In December 2020, we announced that certain key executives would have oversight of ESG matters – our chief growth officer oversees our Environmental initiatives; our chief people officer oversees our Social efforts; and our chief legal officer oversees our Governance matters. These three executives meet regularly to discuss cross-cutting issues and advance ESG priorities.
ESG risks, including climate risks, are a key part of the Board’s enterprise risk management oversight responsibilities, and at each Board meeting, ESG executives meet with the full Board or a committee to review and discuss ESG initiatives, challenges and opportunities, in addition to priorities and progress, which allows appropriate oversight of these matters.
This process also incorporates feedback from shareholders and other key stakeholders on ESG priorities, progress and reporting that we gather during our year-round engagement activities.

We believe that this structure reflects our long-standing values and commitment to best practices in ESG.

Our Governance Guidelines, Code of Conduct and other company policies, consistent with our focus on purpose-driven growth, also establish a framework to guide our decisions and lead with our actions. Our governance profile includes these features:

Board Structure and Independence

All of our director nominees are independent, except for our CEO
Split chair and CEO roles – with independent chair
100% independent Board committee members
Independent chair can call special meetings of the independent directors and actively supervises meeting materials, agendas and schedules
Robust Code of Conduct applicable to directors, officers and employees

Board Oversight

Robust processes for overseeing key risks
Board receives regular updates on key ESG topics
Strong Board and management succession planning process

Director and Executive Compensation

Rigorous stock ownership guidelines for directors and executives
Directors and officers prohibited from hedging our stock, and Section 16 insiders are prohibited from pledging our stock under our insider trading policy
Both our annual and long-term incentive plans include clawback provisions

Shareholder Rights and Accountability

Special meeting right for shareholders
Annual election of all directors
Proactive shareholder engagement
Proxy access right for shareholders

Board Composition

Diverse Board with effective mix of skills, experiences and perspectives
Diverse Board leadership on committees
Adopted formal Board diversity policy in fiscal year 2020
Active Board refreshment – average Board tenure is approximately 5.3 years (as of the Annual Meeting date)
Effective annual Board, Board committee, and individual director evaluation process
Majority voting and director resignation policy in uncontested director elections

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Table of Contents

Stock Ownership Information

Beneficial Ownership of Voting Securities

The following table shows the holdings of common stock (as of August 31, 2021, except as indicated below) by (i) any entity or person known to the Company to be the beneficial owner of more than 5% of the outstanding shares of common stock, (ii) the NEOs named in the Summary Compensation Table, and (iii) all directors and executive officers of the Company as a group.
As discussed in the Director Compensation section of this proxy statement, the majority of director compensation is delivered in the form of deferred stock units, which are paid out in common stock following a director’s termination of service. Because the directors cannot dispose of those shares while they serve on the Board, they are not reflected in this table. See footnote 2 below.

Name of Beneficial Owner       Amount and Nature
of Beneficial
Ownership
(1)(2)
      Percent of
Class(3)
The Vanguard Group, Inc.(4)
100 Vanguard Blvd.
Malvern, PA 19355
15,320,366 12.48
BlackRock, Inc.(5)
55 East 52nd Street
New York, NY 10055
11,996,765 9.77
State Street Corporation(6)
One Lincoln Street
Boston, MA 02111
7,426,780 6.05
Amy Banse(2) 0 *
Richard H. Carmona(2) 0 *
Benno Dorer(7) 327,482 *
Spencer C. Fleischer(2) 944 *
Kevin Jacobsen 59,370 *
Esther Lee(2) 0 *
A. D. David Mackay(2) 1,600 *
Kirsten Marriner 47,485 *
Tony Matta 9,647 *
Paul Parker 68 *
Linda Rendle 90,837 *
Eric Reynolds 68,803 *
Matthew J. Shattock(2) 0 *
Kathryn Tesija(2) 0 *
Pamela Thomas-Graham(2)(8) 1,778 *
Russell J. Weiner(2) 0 *
Christopher J. Williams(2) 0 *
All directors and executive officers as a group (23 persons)(9) 717,962 *

* Does not exceed 1% of the outstanding shares.
(1) Unless otherwise indicated, each beneficial owner listed has sole voting and dispositive power concerning the shares indicated. These totals include the following numbers of shares of common stock that such persons have the right to acquire through stock options exercisable within 60 days of August 31, 2021, or with respect to which such persons have shared voting or dispositive power: Mr. Dorer – 319,157 options; Mr. Jacobsen – 47,322 options and shared voting and dispositive power with respect to 3,145 shares held in family trust; Ms. Marriner – 34,226 options; Mr. Matta – 1,518 options; Ms. Rendle – 80,228 options; Mr. Reynolds – 60,773 options; and all directors and executive officers as a group – 624,177 options. The numbers in the table above do not include the following numbers of shares of common stock that the executive officers have the right to acquire at a later date that were deferred at the executive officers’ election: Mr. Dorer – 3,120; Mr. Jacobsen – 6,928; Ms. Rendle – 8,679; Mr. Reynolds – 7,096; and all executive officers as a group – 35,520.

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Stock Ownership Information

(2) The numbers in the table above do not include the following numbers of shares of common stock that the non-management directors have the right to acquire upon the termination of their service as directors pursuant to deferred stock units granted under the Independent Directors’ Stock-Based Compensation Plan: Ms. Banse – 4,295; Dr. Carmona – 23,147; Mr. Fleischer – 9,560; Ms. Lee – 8,250; Mr. Mackay – 4,295; Mr. Shattock – 4,220; Ms. Tesija – 982; Ms. Thomas-Graham – 27,705; Mr. Weiner – 6,638; and Mr. Williams – 10,425. Deferred stock units are shares of the Company’s common stock that the director receives only upon terminating their service with the Company. Please refer to the Director Compensation section in this proxy statement for further details on the deferred stock units held by non-management directors. The total financial commitment of each non-management director in the Company’s common stock is more fully appreciated if the number of shares of common stock listed above in the column entitled “Amount and Nature of Beneficial Ownership” is added to the number of deferred stock units set forth in this footnote.
(3) On August 31, 2021, there were 122,753,548 shares of common stock outstanding.
(4) Based on information contained in a report on Schedule 13G/A filed with the SEC on February 10, 2021, The Vanguard Group reported, as of December 31, 2020, sole dispositive power with respect to 14,746,336 shares, shared voting power with respect to 229,734 shares and shared dispositive power with respect to 574,030 shares.
(5) Based on information contained in a report on Schedule 13G/A filed with the SEC on January 29, 2021, BlackRock, Inc. reported, as of December 31, 2020, sole voting power with respect to 10,262,810 shares and sole dispositive power with respect to all shares reported.
(6) Based on information contained in a report on Schedule 13G filed with the SEC on February 12, 2021, State Street Corporation reported, as of December 31, 2020, shared voting power with respect to 5,937,245 shares and shared dispositive power with respect to 7,401,658 shares.
(7) Effective February 15, 2021, Mr. Dorer, our executive chair and former CEO, stepped down from his role.
(8) Pamela Thomas-Graham is not standing for re-election when her term expires at the Annual Meeting.
(9) Pursuant to Rule 3b-7 of the Securities Exchange Act of 1934, as amended (Exchange Act), executive officers include the Company’s CEO and all executive vice presidents and senior vice presidents.


Delinquent Section 16(a) Reports

Section 16(a) of the Exchange Act and SEC regulations require the Company’s directors, certain officers, and holders of more than 10% of the Company’s common stock to file reports of ownership on Form 3 and changes in ownership on Form 4 or 5 with the SEC. The reporting directors, officers, and 10% shareholders are also required by SEC rules to furnish the Company with copies of all Section 16(a) reports they file. Based solely on its review of copies of such reports received and written representations from its directors and such covered
officers, the Company believes that its directors and officers complied with all applicable Section 16(a) filing requirements during fiscal year 2021, with the exception of an amended Form 4 to report one transaction for Kevin Jacobsen (fiscal year 2021) and two late Form 4s to report one transaction each for Eric Reynolds (fiscal year 2022) and Matt Gregory (fiscal year 2022), all of which were not reported in a timely manner due to an administrative oversight.

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Table of Contents

Executive Compensation

Proposal 2:
Advisory Vote to Approve Executive Compensation

We are seeking a non-binding, advisory vote from our shareholders to approve the compensation of our NEOs that are listed in the Compensation Discussion and Analysis section of this proxy statement. This proposal gives our shareholders the opportunity to express their views on the Company’s executive compensation, and is commonly referred to as a “say-on-pay” proposal. This vote is only advisory and will not be binding upon the Company or the Board. However, the MDCC, which is responsible for designing and administering the Company’s executive compensation program, values the opinions expressed by shareholders and encourages all shareholders to vote their shares on this matter.

As discussed in the Compensation Discussion and Analysis section of this proxy statement, which begins on page 37, the Company’s compensation programs are designed to align pay with short- and long-term financial and strategic objectives to build shareholder value, while

providing a competitive level of compensation to recruit, retain, and motivate talented executives. The Board urges you to consider the factors discussed in the Compensation Discussion and Analysis section when deciding how to vote on this Proposal 2.

At our 2020 Annual Meeting of Shareholders, our shareholders overwhelmingly approved our executive compensation policies, with approximately 91% of votes cast in favor of our proposal. We value this positive endorsement by our shareholders and believe that the outcome signals our shareholders’ support of our compensation program, and we continued our general approach to compensation for fiscal year 2021. We provide our shareholders the opportunity to vote on the compensation of our named executive officers every year. It is expected that the next vote on executive compensation will be at the 2022 Annual Meeting of Shareholders.



Board’s Recommendation

The Board unanimously recommends a vote FOR the advisory vote to approve executive compensation. The Company is asking its shareholders to support the compensation of the named executive officers as described in this proxy statement. This vote is not intended to address any specific item of compensation, but rather the overall compensation of our named executive officers in fiscal year 2021 and the philosophy, policies, and practices underlying that compensation, which are described in this proxy statement. The Board believes that the Company’s overall compensation process effectively implements its compensation philosophy and achieves its goals.

Accordingly, the Board recommends a vote FOR the adoption of the following advisory resolution, which will be presented at the Annual Meeting:

“RESOLVED, that the shareholders of The Clorox Company approve, on an advisory basis, the compensation of the named executive officers, as disclosed in The Clorox Company’s Proxy Statement for the 2021 Annual Meeting of Shareholders pursuant to the compensation disclosure rules of the Securities and Exchange Commission, including the Compensation Discussion and Analysis, the Summary Compensation Table, and the other related tables and disclosure.”



Vote Required

The affirmative vote of a majority of the votes present in person or represented by proxy and entitled to vote on the matter is required to approve this proposal.

This vote is advisory, and therefore not binding on the Company, the Board, or the MDCC. However, the Board and the MDCC value the opinions of the Company’s shareholders and, to the extent there is any significant vote against the named executive officers’ compensation

as disclosed in the proxy statement, we will consider such shareholders’ concerns, and the MDCC will evaluate whether any actions are necessary to address those concerns.

The people designated in the proxy and voting instruction card will vote your shares FOR approval unless you include instructions to the contrary.


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Table of Contents

Compensation Discussion and Analysis

Introduction

This Compensation Discussion and Analysis (CD&A) describes our executive compensation philosophy and program, the compensation decisions made under this program, and the specific factors we considered in making those decisions. This CD&A focuses on the compensation of our “named executive officers” (NEOs) for fiscal year 2021, who were:

Name Title
Linda Rendle(1) Chief Executive Officer
Benno Dorer(2) Former Executive Chair of the Board and Chief Executive Officer
Kevin B. Jacobsen Executive Vice President and Chief Financial Officer
Eric Reynolds(3) Executive Vice President and Chief Operating Officer
Tony Matta(4) Executive Vice President and Chief Growth Officer
Kirsten Marriner(5) Executive Vice President and Chief People & Corporate Affairs Officer
(1)

Ms. Rendle was appointed as Chief Executive Officer (CEO) and elected to the Board effective September 14, 2020. Prior to her promotion, Ms. Rendle served as President.

(2)

Mr. Dorer began serving as Executive Chair of the Board effective September 14, 2020. Prior to his assumption of this role, Mr. Dorer served as CEO. Mr. Dorer retired effective February 15, 2021.

(3)

Mr. Reynolds was named Executive Vice President and Chief Operating Officer effective September 14, 2020. Prior to his promotion, Mr. Reynolds served as Executive Vice President, Household and Lifestyle.

(4)

Mr. Matta was hired on October 5, 2020.

(5)

Ms. Marriner was named Executive Vice President and Chief People & Corporate Affairs Officer effective December 14, 2020. Prior to her promotion, Ms. Marriner served as Executive Vice President and Chief People Officer.



Table of Contents

Executive Summary 38
Overview 38
Our Company 38
Fiscal Year 2021 Business Highlights 39
Looking Ahead 39
Our Executive Compensation Program 40
Executive Compensation Philosophy 40
How We Make Compensation Decisions 40
Executive Compensation Governance 43
Executive Compensation Framework 46
Fiscal Year 2021 Compensation of Our Named Executive Officers 46
Base Salary 46
Annual Incentives 47
Long-Term Incentives 49
Retirement Plans 50
Post-Termination Compensation 51
Perquisites 51
The Management Development and Compensation Committee Report 52
Compensation Committee Interlocks and Insider Participation 52

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Compensation Discussion and Analysis


Executive Summary

Overview

Clorox continued to experience an unprecedented business environment in fiscal year 2021. In fiscal year 2020, the COVID-19 pandemic caused significant economic and social disruptions and uncertainties, and events during fiscal year 2021 continued that trend. After breakout results for both sales and net earnings in fiscal year 2020, fiscal year 2021 results were mixed, with continued year-over-year strength in net sales and a decrease in net earnings.

Our incentive plan results reflect Company performance. Our slightly below-target payouts on both short- and long-term incentives align to the offsetting business outcomes of significant sales growth, over a similarly high-growth prior fiscal year, offset by declines in gross margin and net earnings.

The Company performance portion of our short-term incentive for fiscal year 2021 was funded at 98%. This result reflected the mixed outcomes in fiscal year 2021 for our underlying metrics: net sales, net earnings attributable to Clorox, and gross margin.

The Company performance portion of our long-term incentive award vesting in 2021 paid out at 94%. The performance-based award vesting in fiscal year 2021 was based on economic profit (EP) growth during fiscal years 2019 through 2021, covering two years of lower-than-expected EP growth and one breakout year with extremely high EP growth.

The MDCC continues to evolve our program. As we look ahead to fiscal year 2022, anticipating record cost inflation and rapidly changing consumer demand, we remain committed to our philosophy of pay for performance. Our incentive plans will be updated based on market benchmarks, changes in our business environment, and areas where we are committed to ensuring alignment of pay and performance, such as ESG achievement.

Fiscal 2021 Net Sales

$7,341M

+9% from prior fiscal year

Fiscal 2021 Net Earnings Attributable to Clorox

$710M

-24% from prior fiscal year

Fiscal 2021 Gross Margin

43.6%

-200 basis points from prior fiscal year

Three-Year Total Shareholder Return1

14.1%


Our Company

Clorox is a leading multinational manufacturer and marketer of consumer and professional products with about 9,000 employees worldwide as of June 30, 2021. Clorox markets some of the most trusted and recognized consumer brand names including its namesake bleach and cleaning products; Pine-Sol® cleaners; Liquid-Plumr® clog removers; Poett® home care products; Fresh Step® cat litter; Glad® bags and wraps; Kingsford® grilling products; Hidden Valley® dressings, dips, seasonings and sauces; Brita® water-filtration systems and filters; Burt’s Bees® natural personal care products; and RenewLife®, Rainbow Light®, Natural Vitality® and NeoCell® vitamins, minerals and supplements. Clorox also markets industry-leading products and technologies for professional

customers, including those sold under the CloroxPro™ and Clorox Healthcare brand names. More than 80% of Clorox’s sales are generated from brands that hold the No. 1 or No. 2 market share positions in their categories.

In fiscal year 2021, the COVID-19 pandemic caused massive economic and societal disruptions. Throughout this time of extreme uncertainty, Clorox remained guided by its IGNITE strategy and focused on innovation in key areas to drive growth and deliver value for both our shareholders and society. See the IGNITE Strategy Guided by ESG Principles section of this proxy statement for more information. With a strong commitment to creating value for all stakeholders, Clorox is well positioned for the future.


____________________
1

Overall change in price per share, plus dividends, during the three fiscal years beginning July 1, 2018 and ending June 30, 2021.


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Compensation Discussion and Analysis

Fiscal Year 2021 Business Highlights

In fiscal year 2021, Clorox delivered net sales growth of 9% in a business environment that continued to be dominated by elevated demand for essential household products, especially cleaning and disinfecting products, as a result of COVID-19. Diluted net earnings per share (EPS) decreased by 24% in a challenging environment that included high levels of competition in select categories, supply challenges, uncertainty related to the global pandemic, persistently high manufacturing and logistics costs, and rising commodity costs.

Clorox launched new products in many categories in fiscal year 2021, including Clorox disinfecting wet mopping cloths; Clorox disinfecting all-purpose spray cleaner; Clorox Turbo handheld power sprayers and disinfectant cleaners; Glad with Clorox trash bags; Kingsford wood pellets; Brita Longlast+ water filters; Brita water bottles in new colors; Fresh Step with Gain original scent cat litter with the power of Febreze; Fresh Step Clean Paws Simply Unscented cat litter; Hidden Valley Secret Sauce golden flavor; Hidden Valley Original Ranch Plant Powered topping and dressing; and Burt’s Bees Squeezy tinted balm.

We relaunched production of some innovations that had been temporarily suspended during the pandemic, such as Clorox compostable cleaning wipes and Clorox Scentiva products, toward the end of the fiscal year.

In international markets, Clorox delivered volume and sales growth, largely resulting from sustained demand for cleaning and disinfecting products as well as other essential household products as a result of COVID-19. Supported by a dedicated supply chain, Clorox expanded its disinfecting wipes business geographically in international markets during fiscal year 2021.

In June 2021, Clorox announced an increase of 5% in its quarterly dividend. In fiscal year 2021, we paid $558 million in dividends to stockholders.

In fiscal year 2021, Clorox continued to make progress on its ESG goals, which are integrated into the IGNITE strategy and throughout the business. See the IGNITE Strategy Guided by ESG Principles section of this proxy statement for more information.

Clorox has been broadly recognized for its corporate responsibility efforts, included on the Barron’s 2021 100 Most Sustainable Companies list, 2021 Bloomberg Gender-Equality Index, the Human Rights Campaign’s 2021 Corporate Equality Index and the 2021 Parity.org Best Places for Women to Advance list, among others.

Looking Ahead

With a business that is significantly larger than before the pandemic and a portfolio of trusted brands, we are accelerating our strategy to take advantage of the strong consumer loyalty we have built during the last eighteen months. We will emphasize innovation, create personalized experiences with our brands and drive our growth runways—all with the goal of growing market share.

In fiscal year 2022, we anticipate ongoing challenges that may impact sales and margins, including continued uncertainty related to the COVID-19 pandemic, elevated commodity costs, and high manufacturing and logistics costs. We are laser-focused on a holistic approach to rebuilding our margins over time.

We are also laying the groundwork for our future through planned investments of approximately $500 million over the next five years to enhance our digital capabilities and transform our culture to significantly improve the Clorox experience for our employees. With the replacement of our global enterprise resource planning system at the heart of this investment, we expect to enhance our supply chain to better position Clorox to meet customer needs, generate efficiencies, and support our digital commerce, innovation, and brand-building efforts.

Finally, we will continue to advance our integrated ESG goals because we believe our societal impact is connected to long-term value creation.



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Table of Contents

Compensation Discussion and Analysis


Our Executive Compensation Program

Executive Compensation Philosophy

A core principle of our compensation philosophy is to align pay with performance. We do so by delivering the majority of executive pay through “at-risk” incentive awards that help ensure realized pay is tied to attainment of critical operational goals and sustainable appreciation in shareholder value. This approach is designed to accomplish the following:

Objective       How we achieve this
Pay for Performance We reward performance that drives achievement of Clorox’s short- and long-term goals and, ultimately, shareholder value.
Align Management and
Shareholder Interests
We provide long-term, equity-based incentives and encourage a culture of ownership with stock retention guidelines. We reward executive officers for sustained company performance as measured by operating results and total shareholder return.
Attract, Retain, and
Motivate Talented
Executives

We maintain market-based pay targets and a program design that allows Clorox to be a magnet for high-performing executives.

Address Risk-
Management
Considerations

We motivate our executives to create long-term shareholder value and discourage behavior that could lead to unnecessary or excessive risk-taking by providing a balance of fixed and at-risk pay, with short-term and long-term performance horizons, using a variety of metrics tied to key drivers of sustainable value creation.

Support Financial
Efficiency

We ensure that cash- and equity-based incentive payouts are appropriately supported by performance, and design awards to minimize unnecessary accounting charges.

How We Make Compensation Decisions

Roles and Responsibilities in Setting Executive Compensation

Management
Development and
Compensation
Committee
     

The MDCC regularly reviews the design and implementation of our executive compensation program and reports on its discussions and actions to the Board. The MDCC oversees our executive compensation program; approves the performance goals and strategic objectives for our NEOs and evaluates results against those targets each year; determines and approves the compensation of our CEO (after consulting with the other independent members of the Board), our other NEOs, and other executive officers, including those covered by Section 16 of the Exchange Act; and makes recommendations to the Board with respect to the structure of overall incentive and equity-based plans.

The MDCC makes its determinations regarding executive compensation after consulting with management and the MDCC’s independent compensation consultant, and its decisions are based on a variety of factors, including Clorox’s performance, individual executives’ performance, peer group data, and input and recommendations from the independent compensation consultant.

The MDCC evaluates individual performance based on the performance of the business or operations for which the executive is responsible, the individual’s skill set relative to industry peers, overall experience and time in the position, the critical nature of the individual’s role, difficulty of replacement, expected future contributions, readiness for promotion to a higher level, and role relative to that of other executive officers.

In determining the compensation package for each of our NEOs other than our CEO, the MDCC receives input and recommendations from our CEO and our Executive Vice President and Chief People & Corporate Affairs Officer. NEOs do not have a role in the determination of their own compensation.


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Compensation Discussion and Analysis

Board of Directors      

The independent members of the Board undertake a thorough process during which they review our CEO’s annual performance, and each independent director provides candid feedback and observations that are shared in aggregate with our CEO. The Board considers a variety of substantive factors it has identified as being most important for effective CEO performance, with a focus on strategy, people, and operations. The full Board discusses the evaluations of our CEO’s performance against these factors and then provides its input on CEO compensation to the MDCC.

The MDCC, after evaluating input from the Board and its independent compensation consultant, makes a final determination on our CEO’s compensation. Our CEO does not have a role in her own compensation determination other than participating in a discussion with the Board regarding her performance relative to specific targets and strategic objectives set at the beginning of the fiscal year, which the Board considers in both its compensation determination and when setting performance targets for the upcoming fiscal year.

Independent
Compensation
Consultant

The MDCC retains the services of an independent compensation consulting firm to assist it in the performance of its duties. During fiscal year 2021, the MDCC used the services of Frederick W. Cook & Co., Inc. (FW Cook). FW Cook’s work with the MDCC included data analysis and guidance and recommendations on the following topics: compensation levels relative to our peers, market trends in incentive plan design, risk and reward structure of executive compensation plans, and other policies and practices, including the policies and views of third-party proxy advisory firms.

FW Cook has provided the MDCC with appropriate assurances and confirmation of its independent status in accordance with the MDCC’s charter and other considerations, including factors specified in the NYSE listing standards. The MDCC believes that FW Cook has been independent throughout its service to the MDCC and that there is no conflict of interest between FW Cook or individuals at FW Cook and the MDCC, Clorox’s executive officers, or Clorox. FW Cook does no work for Clorox apart from its services to the MDCC.

Chief Executive Officer

Our CEO makes compensation recommendations to the MDCC for all executive officers other than herself. In making these recommendations, our CEO evaluates the performance of the executive officers and considers their responsibilities as well as the compensation analysis provided by the independent compensation consultant.

Other Members of Management

Senior human resources management provides analyses regarding competitive practices and pay ranges, compensation and benefit plans, policies and procedures for equity awards, perquisites, general compensation, and benefits philosophy. Senior human resources, legal, and finance executives attend non-executive sessions of the MDCC meetings to provide additional perspective and expertise.


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Compensation Discussion and Analysis

Say-on-Pay Vote and Shareholder Engagement

At our 2020 Annual Meeting of Shareholders, we asked our shareholders to approve, on an advisory basis, our fiscal year 2020 compensation awarded to our NEOs, commonly referred to as a “say-on-pay” vote. Our shareholders overwhelmingly approved the compensation to our NEOs, with approximately 91% of votes cast in favor of our proposal. We believe this outcome signals our shareholders’ support of our compensation program. We continued our general approach to compensation for fiscal year 2021, specifically our pay-for-performance philosophy and our efforts to attract, retain, and motivate our NEOs. We value the opinions of our shareholders and will continue to consider the results from advisory votes on executive compensation, as well as feedback received from our shareholders throughout the year, when making compensation decisions for our NEOs.

Use of Market Data

The MDCC uses a peer group of consumer products companies (the compensation peer group) to help determine competitive compensation rates for our

executive officers, including the NEOs. The compensation peer group was selected by the MDCC, with input from FW Cook. The compensation peer group is used to evaluate both the levels of executive compensation and compensation practices within the consumer products industry.

The MDCC reviews and adjusts the compensation peer group annually, to ensure the companies included continue to meet relevant criteria. To determine the compensation peer group for each year, the MDCC considers companies that:

Hold leadership positions in branded consumer products.
Are of reasonably similar size based on market capitalization and revenue.
Compete with Clorox for executive talent.
Have executive positions similar in breadth, complexity, and scope of responsibility to those of Clorox.

For fiscal year 2021, the compensation peer group was composed of the following 18 companies:

Campbell Soup Company       General Mills, Inc.       McCormick & Company, Inc.
Church & Dwight Co., Inc. The Hershey Company Newell Brands Inc.
Colgate-Palmolive Company Hormel Foods Corporation Post Holdings
Conagra Brands The J.M. Smucker Company Revlon, Inc.
Edgewell Personal Care Kellogg Company Reynolds Consumer Products
The Estée Lauder Companies Inc. Keurig Dr. Pepper S.C. Johnson & Son, Inc.

As of June 30, 2021, Clorox was at the 35th percentile for revenue and 58th percentile for market capitalization compared with the compensation peer group in effect for the fiscal year 2021 compensation analysis.

Management engaged Aon Hewitt to obtain and aggregate compensation data for the compensation peer group in fiscal year 2021. This data was used to advise the MDCC on setting target compensation for our NEOs for fiscal year 2021. FW Cook reviewed this information

and performed an independent compensation analysis of the compensation peer group data to advise the MDCC. Although each individual component of executive compensation is reviewed, particular emphasis is placed on targeting total direct compensation competitive with the median target total direct compensation of the compensation peer group. Other factors, such as an executive’s level of experience, may result in target total direct compensation for individual NEOs being set above or below this median range.


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Executive Compensation Governance

We are focused on creating an effective compensation program that successfully aligns our key strategic objectives with the interests of our shareholders. We believe our executive pay is reasonable and provides appropriate incentives to our executive officers to achieve our financial and strategic goals without encouraging them to take excessive risks in their business decisions. To reinforce this, we have adopted policies that guide our compensation practices as summarized below.

We Do…       We Do Not…
Vary our incentive plans | We use different metrics and performance horizons for the goals within our annual and long-term incentive plans.
Focus on financial measures relevant to shareholder value | We use economic profit as a rigorous long-term incentive metric and net sales, net earnings, and gross margin for our annual incentive metrics.
Require meaningful ownership | We apply stringent stock ownership and retention guidelines for all our executives.
Operate clawback provisions | Both our annual and long-term incentive plans include clawback provisions.
Use a double-trigger | Change-in-control provisions for all equity awards require both change in control and termination.
Engage with shareholders | We have ongoing discussions with key institutional investors, including on the topic of compensation.
Engage an independent consultant | The MDCC engages a consultant and assesses independence annually.
Provide employment contracts | All executives are employed at-will.
Reprice stock options | Any stock option re-pricing would require shareholder approval in advance.
Pay unearned dividends | No dividends or dividend equivalents are paid on unvested equity awards.
Pay tax gross-ups | No tax gross-ups are provided by Clorox to executives, under any circumstances.
Provide excessive benefits or perquisites | Benefits and perquisites are limited, reflecting market benchmarks.
Permit hedging or pledging | Our policy prohibits hedging and pledging of Clorox stock.
Encourage inappropriate risk-taking | The MDCC and its independent consultant annually review incentive design for unintended consequences.

Tally Sheets. To help ensure our executive compensation design is aligned with our overall compensation philosophy of pay for performance and total compensation levels are appropriate, the MDCC annually reviews compensation tally sheets for each of our NEOs. These tally sheets outline current target total compensation, the potential wealth creation of long-term incentive awards granted to our officers under various potential stock prices, and the potential value of payouts under various termination scenarios. These tally sheets help provide the MDCC with a comprehensive understanding of all elements of our compensation program and enable the MDCC to consider changes to

our compensation program, arrangements, and plans considering best practices and emerging trends.

Stock Award Granting Practices. Clorox grants long-term incentive awards each September at a regularly-scheduled MDCC meeting, which typically occurs during the third week of the month. The meeting date is the effective grant date for the awards, and the exercise/grant price is equal to the closing price of our common stock on that date.

The MDCC may also occasionally grant stock options and other equity-based awards at other times to recognize, retain, or recruit executive officers.


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Executive Stock Ownership Guidelines. To maintain alignment of the interests of our executive officers and our shareholders, all executive officers are expected to build and maintain a significant level of direct stock ownership. Ownership levels may be achieved over time in a variety of ways, such as by retaining stock received upon the exercise of stock options or the vesting of stock awards or by purchasing stock in the open market. At a minimum,

executive officers are expected to establish and maintain direct ownership of common stock having a value equal to a multiple of each executive officer’s annual base salary: six times base salary for the CEO, three times base salary for NEOs and non-NEO members of the Clorox Executive Committee, and two times base salary for other executives.


The following table reflects the guidelines and our NEOs’ ownership requirement status, as of August 31, 2021:

Name Ownership Guideline
(Salary Multiple)
Guideline Met
Ms. Rendle(1)       6x       No
Mr. Jacobsen 3x Yes
Mr. Reynolds 3x Yes
Mr. Matta(2) 3x No
Ms. Marriner 3x Yes
(1) Ms. Rendle became subject to a higher ownership requirement upon her appointment to CEO effective September 14, 2020 (from three times to six times base salary).
(2) Mr. Matta was hired on October 5, 2020, and the ownership requirement of 3 times base salary became effective immediately.

Ownership levels are based on shares of common stock owned by the NEO or held pursuant to Clorox plans, including performance share units that have vested and been deferred for settlement. Unexercised stock options and shares that have not vested due to time or performance restrictions are excluded from the ownership calculations.

Retention Requirements. Executive officers are required to retain a certain percentage of shares obtained upon either the exercise of stock options or the release of restrictions on performance share units and restricted stock units. All executive officers are expected to retain 75% of net shares acquired after tax withholding until the minimum ownership level is met. After attaining the minimum ownership level, our CEO must retain 50% of net shares acquired after tax withholding until retirement or termination, and other executive officers must retain 25% of net shares acquired after tax withholding for one year after receipt.

Securities Trading Policy and Prohibition on Hedging and Pledging. To ensure alignment of the interests of our shareholders with all of our directors, officers, employees, and consultants, our Insider Trading Policy does not permit any director, officer, employee, or consultant of Clorox either (1) to trade in the stock or other securities of any company when aware of material nonpublic information about that company, including Clorox as well as any customers or suppliers of Clorox or firms with

which Clorox may be negotiating a major transaction, or (2) to engage in short-term or speculative transactions or derivative transactions involving Clorox stock. This policy includes prohibitions on options trading and hedging and restrictions and cautions on pledging Clorox stock as collateral.

The Insider Trading Policy’s prohibition on engaging in hedging transactions in Clorox securities covers the purchase of a financial transaction instrument, or otherwise engaging in a transaction that hedges or offsets, or is designed to hedge or offset, any decrease in the market value of Clorox’s equity securities that were granted as part of the individual’s compensation or that the individual holds directly or indirectly. The following transactions are expressly prohibited by this policy:

Short sales (selling Clorox securities you do not own).
Transactions involving publicly traded options or other derivatives whose value is tied to Clorox securities, including trading in or writing puts or calls on Clorox securities.
Pre-paid forward contracts.
Collars.

Directors, executive officers, the principal accounting officer, and 10% beneficial owners of Clorox common stock are also prohibited from borrowing against the value of any Clorox stock that they own using a margin account or other pledge of Clorox stock as collateral.


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Trading of Clorox’s securities by directors, executive officers and certain other employees who are so designated from time to time (collectively, Insiders) is permitted only during announced trading periods or in accordance with a previously established trading plan that meets SEC requirements. At all times, including during announced trading periods, Insiders are required to obtain preclearance from our Chief Legal Officer or corporate secretary prior to executing any transactions in Clorox securities, unless those sales occur in accordance with a previously established trading plan that meets SEC requirements.

Clawback Provisions. Effective February 9, 2021, the MDCC adopted a Clawback Policy related to incentive compensation granted, promised, or paid to certain current and former executive officers (and others as the MDCC may determine) on or after the effective date. Under the terms of the Clawback Policy:

In the event a covered individual engages in conduct materially detrimental to Clorox (including, but not limited to, the name, business interests, or corporate, brand, business, or other reputation of Clorox), the MDCC may recoup incentive compensation paid to such individual at any time up to three years after the end of the year in which it vested or was paid.
In the event of a restatement of Clorox financial statements, the MDCC may recoup incentive compensation paid to a covered individual during the three-year period preceding the announcement of the restatement that would not have been paid based upon the restated results if the covered individual’s fraud or intentional misconduct was a significant contributing factor to the restatement.

Certain of our existing compensation plans and agreements, including the AIP and our long-term incentive plan award agreements, contain a provision providing for clawback of the incentive compensation following a restatement of Clorox financial statements. The Clawback Policy incorporates such existing clawback provisions without any material changes, to include all clawback provisions for covered individuals in the Clawback Policy.

Tax Deductibility Limits on Executive Compensation. Section 162(m) of the Internal Revenue Code (IRC) limits the federal income tax deductibility of compensation paid to our covered employees to $1 million per year. In setting executive compensation, the MDCC does not take this limit on deductibility into account.



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Executive Compensation Framework

A substantial portion of our target total direct compensation for our executives is variable, with 87% of compensation at risk for our CEO and 80% of compensation at risk on average for our other NEOs. Base salary is the only fixed component of direct compensation.

Component and Rationale       CEO
Proportion(1)
      NEO(2)
Proportion(1)
      Performance
Measures
      Performance
Period
      Characteristics

Base Salary

Fixed pay to attract and retain talent, based on role, level of responsibilities, and individual performance.

N/A
N/A

Fixed cash

Annual Incentives

Variable pay to incent and recognize performance in areas of short-term strategic importance.

Annual net sales (50%)
Net earnings (30%)
Gross margin (20%)
Individual performance goals
One Year Performance-based cash

Long-Term Incentives

Equity-based pay to incent and recognize performance in areas of long-term strategic importance, promote retention and stability, and align executives with shareholders.

Three-year annual economic profit growth rate
Variation in underlying stock price due to overall business results
Three Years Performance share units, stock options, and restricted stock units
(1) Proportion represents the actual base salary, target annual incentive award, and grant date fair market value of actual long-term incentive awards granted in fiscal year 2021 (with performance share units measured at target). Refer to the Summary Compensation Table for further details on actual compensation.
(2) Represents the average of all NEOs active on June 30, 2021, other than the CEO. Percentages are rounded.

Additional elements of our executive compensation program include retirement plans, post-termination compensation, and perquisites as appropriate to support our executive compensation philosophy.


Fiscal Year 2021 Compensation of Our Named Executive Officers

Base Salary

The MDCC generally seeks to establish base salaries for our NEOs competitive with the median of the compensation peer group. Salaries vary in relation to each executive’s specific role, level of experience, and

performance over time. For fiscal year 2021, base salary changes within this target pay range were approved by the MDCC in September 2020 and went into effect in September 2020.


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Name FY 2021
Base Salary
(1)
Increase in
FY 2021(2)
Ms. Rendle(3)             $ 1,075,000                       34.4 %
Mr. Dorer $ 1,230,000
Mr. Jacobsen(4) $ 700,000 16.7 %
Mr. Reynolds $ 700,000
Mr. Matta(5) $ 625,000
Ms. Marriner(6) $ 625,000 17.9 %
(1)

Annualized salary as of June 30, 2021, or date of termination if applicable.

(2)

Increase relative to salary as of June 30, 2020.

(3)

Salary increased from $800,000 to $1,075,000 effective September 14, 2020 in association with promotion.

(4)

Salary increased from $600,000 to $650,000 effective September 21, 2020 in association with annual merit review. Salary increased from $650,000 to $700,000 effective December 14, 2020 in association with the expansion of his role.

(5)

Salary upon hire, effective October 5, 2020.

(6)

Salary increased from $530,000 to $575,000 effective September 21, 2020 in association with annual merit review. Salary increased from $575,000 to $625,000 effective December 14, 2020 in association with promotion.


In addition to his annual salary, Mr. Matta received a one-time cash sign-on bonus of $500,000 as part of his hire, subject to clawback upon resignation or termination for cause prior to completing one year of employment, to compensate for a portion of expected cash compensation he would otherwise have received from his former employer had he not terminated his employment there to join Clorox.

Annual Incentives

Clorox provides annual incentive awards to our NEOs under the Annual Incentive Plan (AIP). Payouts under the AIP are based on the level of achievement of company performance goals set annually by the MDCC, subject to shareholder-approved maximums. These performance goals are tied to Board-approved corporate financial performance goals and individual objectives.

The AIP balances financial performance with the individual performance of each of our NEOs. The amounts paid under the AIP are based on the following factors:

(1)

A target value for each NEO, which is base salary multiplied by an annual incentive target (Target Award).

(2)

Clorox’s performance measured against pre-established corporate financial goals (Company Multiplier). The Company Multiplier can range from 0% to 200% based on an objective assessment of company performance versus goals established by the MDCC at the beginning of the year.

(3)

Performance of the operations or functions under the NEO’s responsibility (Individual Multiplier). The Individual Multiplier can range from 0% to 150%. The Individual Multiplier is determined by the MDCC

    

and typically has a narrow range, which makes its impact on the total payout significantly smaller than the Company Multiplier: Over the past three years, the range for Individual Multipliers for the NEOs was 90 to 115%, compared to 67 to 200% for the Company Multiplier during the same period.

Target Award. Each year, the MDCC sets an annual incentive target level for each NEO as a percentage of their base salary, based on an assessment of median bonus targets in the compensation peer group and other factors such as individual experience. The annual incentive target level is typically set near the median of bonus targets for comparable positions in the compensation peer group.

Company Multiplier. At the beginning of each fiscal year, the MDCC sets financial goals for the AIP based on targets approved by the Board. At the end of the year, the MDCC reviews Clorox’s results against the goals set at the beginning of the year and approves the final Company Multiplier.

For fiscal year 2021, the MDCC established goals for net sales, net earnings, and gross margin to drive sustainable, profitable growth and short- and long-term total shareholder returns. This combination of metrics effectively balances a focus on both top-line and bottom-line performance. Fiscal year 2021 goals for net sales, net earnings, and gross margin were set above the prior year’s actual results, in spite of our breakout results in fiscal year 2020, reflecting our focus on strategic business choices and a drive toward operational efficiencies.



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Fiscal year 2021 financial goals for the AIP, the potential range of payouts for achieving those goals, and the actual results as determined by the MDCC were as follows:

2021 Annual Incentive Financial Goals (in millions)       Weight       Threshold
(0%)
      Target
(100%)
      Maximum
(200%)
      Actual(1)
Net Sales 50%     $ 6,558 $ 6,977     $ 7,395   $ 7,300
Net Earnings 30% $ 852 $ 969 $ 1,085 $ 684
Gross Margin 20% 41.7% 45.7% 49.7% 43.6%
(1)

Results exclude the fiscal year 2021 net impact of the following items on net sales, net earnings, and gross margin: accounting guidelines for equity-based compensation (Accounting Standards Update 2016-09), acquisition of a majority share in a joint venture in the Kingdom of Saudi Arabia, divestiture of our Healthlink business, an insurance settlement for hurricanes during fiscal year 2018, closure of our Dominican Republic business, and foreign exchange.

Individual Multiplier. Consistent with our pay-for-performance philosophy, AIP payouts are determined by the Company Multiplier and an Individual Multiplier. Based on its evaluation of individual performance, the MDCC reviewed and approved the Individual Multiplier for each NEO to reflect the officer’s individual contributions in fiscal year 2021. In determining the multiplier for individual performance, the MDCC carefully evaluates several performance factors against objectives established at the beginning of the year.

Individual performance for each of our NEOs is evaluated holistically and for 2021 included how each executive addressed continuing challenges posed by COVID-19; ESG-related achievements such as management of human capital including diversity and inclusion and management of environmental risks; contributions to company operations and strategy; and position-specific business outcomes. A performance summary for each NEO for fiscal year 2021 is provided in the table below.


Name

     

Individual Multiplier

     

Performance Summary

Ms. Rendle

100%

Outstanding leadership in a dynamic year. Smooth transition into CEO role, delivering record top-line growth and significant cash generation but with lower-than-expected bottom line results reflecting significant inflationary pressure driving increased costs. Excellent people-related results (e.g., health, safety, inclusion & diversity, engagement) and material progress against our IGNITE strategy including superior consumer value and net sales from innovation as well as continued strong cost savings and progress toward the company’s long-term ESG goals (e.g., climate action, packaging, product stewardship and pay equity, among others).

Mr. Dorer

100%

Provided strong leadership through the first quarter as CEO and facilitated a seamless CEO transition in early Q2 and through his tenure as Executive Chair until his retirement in February 2021.

Mr. Jacobsen

100%

Provided strong stewardship for our financial results and cost savings and drove strong tax and treasury outcomes including extending supplier payment terms and execution on share buyback program. Led progress on our M&A roadmap, process and capabilities. Materially contributed to our progress on renewable energy.

Mr. Reynolds

105%

Led development of our digital transformation plan, positioning the company to deliver on our long-term growth aspirations. Navigated significant complexity on the business to deliver a record year for top-line growth in the midst of a dynamic external environment and unprecedented costs. Served as chair of I&D committee and as executive sponsor of two employee resource groups (ERGs).

Mr. Matta

95%

Joined the company in Q2. Provided leadership for discovery with key growth runways, with results expected in the coming fiscal year. Began deepening targeted strategic capabilities required to deliver on IGNITE. Provides executive leadership for our sustainability center, which generated strong progress toward our long-term ESG goals (e.g., related to product and packaging).

Ms. Marriner

110%

Provided strong contributions toward a seamless CEO transition in Q1 and subsequent senior talent transitions. Provided leadership through the pandemic on global people priorities with outstanding health & safety and I&D (e.g., representation, pay equity) outcomes for the company as well as upper quartile employee engagement results.

Beginning in fiscal year 2022, as part of the holistic assessment of each NEO's performance, the MDCC will leverage ESG-related metrics from our IGNITE scorecard. The ESG metrics from the IGNITE scorecard that are relevant to each NEO's role will be embedded in the

NEOs' fiscal year 2022 priorities, and those scorecard results will be factored into the MDCC's evaluation of each individual's performance. See the IGNITE Strategy Guided by ESG Principles section of this proxy statement for more information about the IGNITE scorecard.


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Final AIP payouts. We funded the AIP at a 98% Company Multiplier, reflecting our achievement on each of the three performance metrics.

NEO Base
Salary
Annual
Incentive
Target

(% of Salary)
Company
Multiplier
Individual
Multiplier
Final
Annual
Incentive
Plan Payout
Ms. Rendle(1)       $ 1,075,000       150 %               98 %              100 %          $ 1,526,132
Mr. Dorer(2) $ 1,230,000            150 % 98 % 100 % $ 1,139,351
Mr. Jacobsen $ 700,000 90 % 98 % 100 % $ 617,400
Mr. Reynolds $ 700,000 100 % 98 % 105 % $ 720,300
Mr. Matta(3) $ 625,000 85 % 98 % 95 % $ 364,509
Ms. Marriner(1) $ 625,000 75 % 98 % 110 % $ 489,992
(1)

Ms. Rendle’s annual incentive target increased from 125% to 150% effective upon her September 14, 2020 promotion, and Ms. Marriner’s annual incentive target increased from 70% to 75% effective upon her December 14, 2020 promotion. Their award calculations include proration of the targets for the portion of fiscal year 2021 in which each target was effective.

(2)

Mr. Dorer is eligible for a pro-rata AIP payment for fiscal year 2021, calculated through the date of his retirement on February 15, 2021.

(3)

Mr. Matta’s AIP payment for fiscal year 2021 is pro-rated based on his hire date of October 5, 2020.

Long-Term Incentives

We provide long-term, equity-based incentive compensation to our NEOs, which aligns Clorox performance and executive officer compensation with the interests of our shareholders. These incentive awards also support the achievement of our long-term corporate financial goals.

The MDCC annually reviews the costs of, and potential shareholder dilution attributable to, our long-term incentive program to ensure that the overall program

is financially efficient and aligned with those of our compensation peer group. The MDCC also seeks to calibrate the long-term incentive program design to drive performance and deliver awards that are competitive with the median of the compensation peer group. Actual long-term incentive award targets for individual NEOs may vary from the median based on a variety of factors, such as the NEO’s performance over time, individual experience, critical nature of their role, and expected future contributions.


Name Target Value
Ms. Rendle           $ 5,000,000
Mr. Dorer(1) $ 500,000
Mr. Jacobsen $ 1,700,000
Mr. Reynolds $ 2,100,000
Mr. Matta(2) $ 2,500,000
Ms. Marriner $ 1,200,000
(1)

On August 1, 2020, the MDCC approved a target cash compensation package for Mr. Dorer that did not include a normal LTI award, due to his pending transition to Executive Chair of the Board. In lieu of the normal LTI award, Mr. Dorer received a restricted stock unit award of $500,000 in recognition of his reduced responsibility stepping out of the CEO role and his expected short-term tenure as Executive Chair of the Board.

(2)

Represents Mr. Matta’s new hire annual long-term incentive award of $1,000,000 and a one-time restricted stock unit award of $1,500,000, reflecting a buyout of existing equity awards Mr. Matta forfeited upon termination of his prior employment.

Like annual incentive awards, actual long-term incentive award payouts vary from the target based on how Clorox performs against pre-established targets. The value of payouts also varies based on changes in the market price of our common stock.

For fiscal year 2021, the MDCC determined that our NEOs would receive 60% of the value of their total annual long-term incentive award granted in performance share units, 20% in stock options, and 20% in restricted

stock units, as opposed to the prior fiscal year’s 50/50 split between performance share units and stock options. This new equity mix provides balance in the long-term incentive program, improving retention value and aligning to peers’ weighting for stock options while continuing to reinforce long-term company performance.

From time to time, we grant additional time-based restricted stock units for special purposes for both executive and non-executive officers, such as in


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connection with a promotion or as a replacement for compensation forfeited by an externally recruited executive at a prior employer, as in the case of Mr. Matta’s fiscal year 2021 one-time restricted stock unit award.

Performance share units (PSUs). PSUs align the interests of our NEOs with the interests of our shareholders because the number of shares earned and the shares’ potential value are tied to the achievement of performance targets, as well as changes in Clorox stock price. PSUs pay out after a three-year performance period, only if Clorox meets pre-established financial performance goals.

The performance target for the awards granted in September 2020 is a three-year annual economic profit (EP) growth rate during the performance period of July 2020 through June 2023. This metric directly supports our corporate strategy and long-term financial goals and correlates to stock price performance. EP performance is measured relative to a three-year average

annual growth rate that is established at the beginning of the cycle and held constant. Solely for purposes of the PSU performance metric, EP is defined as earnings before interest and taxes, adjusted for non-cash restructuring charges, times one minus the tax rate, less capital charge. The payout percentage ranges from 0%, if threshold EP growth is not achieved, to a maximum of 200% of the target number of shares. A payout percentage is calculated for each fiscal year during the performance period, and the three annual payout percentages are averaged to determine the final payout percentage.

For the awards granted in September 2018, the MDCC approved payout levels tied to a 2.7% average annual EP growth target for the three-year performance period from July 2018 through June 2021. In August 2021, the MDCC certified a final payout for the 2018 awards of 94% of target, based on the average of the annual payout percentages for the three fiscal years in the performance period.


Annual EP Growth Adjusted(1)
Actual EP
Growth
Payout
Performance share units       Threshold
(0%)
      Target
(100%)
      Maximum
(200%)
           
FY2019 Economic Profit Growth Rate       -7.3 %    2.7 %      10.2 % -2.8 % 45 %
FY2020 Economic Profit Growth Rate -7.3 % 2.7 % 10.2 %        17.9 %    200 %
FY2021 Economic Profit Growth Rate -7.3 % 2.7 % 10.2 % -3.7 % 36 %
Three-Year Average Annual Economic Profit Growth Rate -7.3 % 2.7 % 10.2 % 94 %
(1)

In accordance with predetermined criteria established by the MDCC at the time initial awards were approved, annual growth rates were adjusted for the impacts of the following Events (as defined in the 2018 PSU award agreements): a fiscal year 2021 non-cash impairment charge in the Better Health Vitamins, Minerals and Supplements business; a fiscal year 2021 non-cash charge related to investments and arrangements made with a Professional Products business unit supplier; acquisition of a majority share in a joint venture in the Kingdom of Saudi Arabia in July 2020; the fiscal year 2021 net impact of an insurance settlement for hurricanes during fiscal year 2018; the fiscal year 2021 closure of our Dominican Republic business; the adoption of Accounting Standard Codification 842 – Leases; and certain net adjustments related to trade expenses.

Stock options. Stock options align the interests of our NEOs with those of our shareholders because the options only have value if the price of Clorox stock increases after the stock options are granted. Stock options vest in 25% increments over a four-year period, beginning one year from the date of grant, and expire ten years from the date of grant.

Restricted stock units (RSUs). RSUs align the interests of our NEOs with those of our shareholders because the value of RSUs increases or decreases as the price of Clorox stock changes. RSUs vest in 25% increments over a four-year period, beginning one year from the date of grant.

Retirement Plans

Our NEOs participate in the same tax-qualified retirement benefit programs available to all other United States-based salaried and hourly employees not subject to

collective bargaining agreements. Our retirement plans are designed to provide replacement income upon retirement and to be competitive with programs offered by our peers.

Because the Internal Revenue Code (IRC) limits the benefit value that may be contributed to and paid from a tax-qualified retirement plan, Clorox also provides our executive officers, including our NEOs, with additional retirement benefits intended to restore amounts that would otherwise be payable under our tax-qualified retirement plans if the IRC did not have limits on includable compensation and maximum benefits. We call these plans “restoration plans” because they restore total executive retirement benefits to the same percentage level provided to our salaried employees who are not limited by IRC restrictions.


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Below are brief descriptions of each of our retirement programs. Each of our NEOs participates in these retirement programs, except for the Clorox Company Pension Plan and the Supplemental Executive Retirement Plan.

The Clorox Company Pension Plan. The Clorox Company Pension Plan (the Pension Plan) is a cash balance pension plan that was frozen effective June 30, 2011. This freeze did not affect benefits previously accrued under the Pension Plan, which remain fully funded.

The Clorox Company 401(k) Plan. After the Pension Plan was frozen in June 2011, the Clorox Company 401(k) Plan (the 401(k) Plan) became the primary retirement plan for Clorox. Clorox makes an annual fixed contribution of 6% of eligible pay and a matching contribution of up to 4% of eligible pay to eligible employees.

Nonqualified Deferred Compensation Plan. Under the Nonqualified Deferred Compensation Plan (the NQDC), eligible employees may voluntarily defer receipt of up to 50% of base salary and up to 100% of their annual incentive awards. In fiscal year 2021, deferred amounts could be invested in a manner that generally mirrored the funds available in the 401(k) Plan. The NQDC permits Clorox to contribute amounts that exceed the IRC compensation limits in the tax-qualified plan through a 401(k) restoration provision for those employees deferring at required levels in the plan.

Supplemental Executive Retirement Plan. The Supplemental Executive Retirement Plan (the SERP), a defined benefit plan, was closed to new participants in April 2007 and, effective June 30, 2011, was frozen for pay and offsets, while still accruing age and service credits. Benefits under the SERP have historically been calculated as an annuity based on a percentage of average compensation adjusted by age and years of service and offset by the annuity value of Clorox contributions to the tax-qualified retirement plans and by Social Security. Effective July 1, 2011, the SERP was replaced by the Executive Retirement Plan (the ERP), described below. Moving from the SERP to the ERP created a defined-contribution structure that is more closely aligned with the benefits provided by our compensation peer group. In March 2018, the SERP was amended to provide that designated participants whose service as an executive of Clorox is succeeded by service as a consultant or advisor will be entitled to receive age and service credits while serving as a consultant or advisor for purposes of accruing an early retirement benefit under the SERP, provided that they have attained a minimum of 25 years of service and are at least 50 years

old at the time that service as a consultant or advisor commences. Except for Mr. Dorer, none of our NEOs is eligible for the SERP.

Executive Retirement Plan. Our executive officers participate in the ERP. Under the ERP, Clorox makes an annual contribution of 5% of an eligible participant’s base salary and annual incentive award into the plan.

Further details about the provisions of the Pension Plan, NQDC, SERP, and ERP are provided in the Overview of Pension Benefits and the Overview of the Nonqualified Deferred Compensation Plans sections below.

Post-Termination Compensation

Clorox has a severance plan (the Severance Plan) that provides our NEOs with post-termination payments if the NEOs’ employment is terminated by Clorox other than for cause. These payments are intended to provide a measure of financial security following the loss of employment, which is important to attract and retain executives. The severance benefits are designed to be competitive with the compensation peer group and external market practices.

Clorox also has an Executive Change in Control Severance Plan (the CIC Plan), which provides severance benefits to certain eligible executives of Clorox, including all NEOs, if their employment with Clorox is involuntarily terminated in connection with a change in control of Clorox. In addition to helping mitigate the financial impact associated with termination after a change in control, these benefits further align the interests of our executive officers with the interests of our shareholders by providing incentives for retention, for business continuity purposes. Under the CIC Plan, NEOs are eligible for change in control severance benefits if their employment is terminated in connection with a change in control, either by Clorox without cause or by the NEO for good reason. See the Potential Payments Upon Termination or Change in Control section for additional information.

Perquisites

We provide our NEOs with other limited benefits competitive with the compensation peer group and consistent with our overall executive compensation program: an annual executive physical exam, reimbursement for health club membership, a company car or car allowance, paid parking at our headquarters, and financial planning services. These perquisites are market-competitive and beneficial to Clorox by enabling our NEOs to proactively manage their health, work more efficiently, and optimize the value received from our compensation and benefits programs.


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Compensation Discussion and Analysis


The Management Development and Compensation Committee Report

As detailed in its charter, the Management Development and Compensation Committee of the Board oversees Clorox’s executive compensation program and policies. As part of this function, the MDCC discussed, and reviewed with management, the CD&A. Based on this review and discussion, we have recommended to the Board that the CD&A be included in the proxy statement.

THE MANAGEMENT DEVELOPMENT AND COMPENSATION COMMITTEE

Spencer C. Fleischer, Chair
Richard H. Carmona
David Mackay
Kathryn Tesija
Russell J. Weiner


Compensation Committee Interlocks and Insider Participation

Dr. Carmona, Messrs. Fleischer, Mackay, and Weiner, and Ms. Tesija each served as a member of the MDCC during part or all of fiscal year 2021. None of the members was an officer or employee of Clorox or any of its subsidiaries during fiscal year 2021 or in any prior fiscal year. No executive officer of Clorox served on the Board or compensation committee of any other entity that has or had one or more executive officers who served as a member of the Board or MDCC during fiscal year 2021.

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Table of Contents

Compensation Discussion and Analysis Tables

Summary Compensation Table – Fiscal Year 2021

The following table sets forth the compensation earned, paid, or awarded to our NEOs for the fiscal years ended June 30, 2021, 2020, and 2019.

Name and
Principal
Position
Year Salary
($)(1)
Bonus
($)(2)
Stock
Awards
($)(3)(4)
Option
Awards
($)(3)
Non-Equity
Incentive Plan
Compensation
($)(5)

Change in
Pension
Value and
Nonqualified
Deferred
Compensation
Earnings
($)(6)
All Other
Compensation
($)(7)
Total
($)
Linda Rendle(7)
Chief Executive
Officer
     2021      1,006,250           3,999,753      1,000,180      1,526,132      833      366,161      7,899,309
2020 523,965 600,194 600,006 291,182 1,572 144,820 2,161,739
2019 435,923 563,379 312,577 271,900 1,401 117,181 1,702,362
Benno Dorer
Former Executive
Chair of the Board
and Chief Executive
Officer
2021 1,014,750 499,943 1,139,351 712,166 3,366,210
2020 1,269,231 2,949,972 2,950,287 3,690,000 1,161,950 402,459 12,423,899
2019 1,166,346 2,874,521 2,874,816 1,206,000 859,528 381,504 9,362,715
Kevin Jacobsen
Executive Vice
President and Chief
Financial Officer
2021 654,038 1,361,356 340,450 617,400 7,423 277,187 3,257,854
2020 609,615 699,930 700,059 1,020,000 5,999 154,644 3,190,247
2019 536,539 649,918 649,958 331,650 4,612 122,077 2,294,753
Eric Reynolds(8)
Executive Vice
President and Chief
Operating Officer
2021 700,000 1,679,713 420,084 720,300 2,245 286,907 3,809,250
2020 601,923 649,846 650,049 1,028,350 110,378 3,040,546
2019 462,788 450,587 450,016 231,071 3,120 119,035 1,716,617
Tony Matta
Executive Vice
President and Chief
Growth Officer
2021 432,692 500,000 2,299,792 199,951 364,509 26,500 3,823,443
 
Kirsten Marriner
Executive Vice
President and
Chief People and
Corporate Affairs
Officer
2021 587,885 959,958 240,048 489,992 250,310 2,528,192
 
 
 
(1)

Reflects actual salary earned for fiscal years 2021, 2020, and 2019.

(2)

Mr. Matta received a one-time cash sign-on bonus at hire, to compensate for a portion of expected cash compensation he would otherwise have received from his former employer had he not terminated his employment there to join Clorox.

(3)

The amounts reflected in these columns are the values determined under FASB ASC Topic 718 for the awards granted in the fiscal years ended June 30, 2021, 2020, and 2019, in accordance with the applicable accounting standard. The assumptions made in valuing stock awards and option awards reported in these columns are discussed in Note 1, Summary of Significant Accounting Policies under subsection “Stock-Based Compensation”, and in Note 16, Stock-Based Compensation Plans, to the Clorox consolidated financial statements for the three years in the period ended June 30, 2021, included in our Annual Report on Form 10-K for the fiscal year ended June 30, 2021. Additional information regarding the stock awards and option awards granted to our NEOs during fiscal year 2021 is set forth in the Grants of Plan-Based Awards--Fiscal Year 2021 table.


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Compensation Discussion and Analysis Tables

(4)

The grant date fair value of the PSU awards reflected in this column is the target payout based on the probable outcome of the performance-based conditions, determined as of the grant date. The maximum potential payout of the PSU awards would be 200% of the target shares awarded on the grant date. The maximum value of the PSU award for 2021 determined as of the date of grant for each respective NEO is presented in the following table. See the Grants of Plan-Based Awards - Fiscal Year 2021 table for more information about the PSUs granted under the 2005 Stock Incentive Plan.

Linda
Rendle
Benno
Dorer
Kevin
Jacobsen
Eric
Reynolds
Tony
Matta
Kirsten
Marriner
Maximum PSU Value       $ 5,999,735             $ 2,042,246       $ 2,519,676       $ 1,199,873       $ 1,439,936
(5)

Reflects annual incentive awards earned for fiscal years 2021, 2020, and 2019 and paid out in September 2021, September 2020, and September 2019, respectively, under the AIP. Information about the AIP is set forth in Compensation Discussion and Analysis under Annual Incentives.

(6)

The amounts reflect the aggregate change in the present value of accumulated benefits during fiscal years 2021, 2020, and 2019 under the SERP, the Pension Plan, and the cash balance restoration benefit of the NQDC. The SERP, the Pension Plan, and the cash balance restoration benefit of the NQDC are all frozen benefits; refer to the Pension Benefits--Fiscal Year 2021 table for further information. Each plan amount in fiscal year 2021 is set forth in the following table:

Linda
Rendle
Benno
Dorer
Kevin
Jacobsen
Eric
Reynolds
Tony
Matta
Kirsten
Marriner
The Pension Plan $ 833    $ 843      $ 2,196      $ 1,629
SERP             (18,035 )                        
Cash Balance Restoration Benefit 11,542 5,227 616
Total    $ 833    $ (5,650 ) $ 7,423 $ 2,245     $ 0          $ 0
(7)

The amounts shown in the All Other Compensation column represent (i) actual Clorox contributions under the 401(k) Plan, (ii) nonqualified contributions under the NQDC and ERP, and (iii) perquisites provided to our NEOs:

Linda
Rendle
Benno
Dorer
Kevin
Jacobsen
Eric
Reynolds
Tony
Matta
Kirsten
Marriner
The Clorox Company 401(k) Plan       $ 30,088       $ 26,683        $ 27,483        $ 18,123       $ 0       $ 28,702
Nonqualified Deferred Compensation Plan 300,977 658,865 220,334 227,035 6,010 184,160
Company Paid Perquisites 35,097 26,618 29,370 41,749 20,490 37,449
Total $ 366,161 $ 712,166 $ 277,187 $ 286,907 $ 26,500 $ 250,310

The following table sets forth the perquisites provided to our NEOs and the cost to Clorox for providing these perquisites during fiscal year 2021. The amounts shown in the Other Perquisites row consist of paid parking at our Oakland headquarters, health club reimbursement, and an annual executive physical.

  Linda
Rendle
Benno
Dorer
Kevin
Jacobsen
Eric
Reynolds
Tony
Matta
Kirsten
Marriner
Executive Automobile Program       $ 13,200       $ 8,800          $ 6,219          $ 13,200         $ 9,900         $ 13,200
Basic Financial Planning 16,627 12,499 16,627 20,875 6,510 15,719
Other Perquisites 5,270 5,319 6,524 7,674 4,080 8,530
Total $ 35,097 $ 26,618 $ 29,370 $ 41,749 $ 20,490 $ 37,449

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Compensation Discussion and Analysis Tables


Grants of Plan-Based Awards – Fiscal Year 2021

This table shows grants of plan-based awards to the NEOs during fiscal year 2021.

Estimated Possible Payouts
Under Non-Equity Incentive
Plan Awards



Estimated Possible Payouts
Under Equity Incentive Plan
Awards






All Other
Stock
Awards:
Number
of Shares
of Stock
or Units
(#)
All Other
Option
Awards:
Number of
Securities
Underlying
Options
(#)
Exercise
or Base
Price of
Option
Awards
($/Sh)
Grant
Date Fair
Value
of Stock
and
Option
Awards
($)
Name Grant
Date
Threshold
($)
Target
($)
Maximum
($)
Threshold
(#)
Target
(#)
Maximum
(#)
Linda Rendle                      
Annual Incentive Plan(1) 1,557,278 4,671,833
Performance Share Units(2)  9/22/2020 14,125 28,250 2,999,868
Restricted Stock Units(3) 9/22/2020 4,708 999,885
Stock Options(4) 9/22/2020 32,316 212.38 1,000,180
Benno Dorer
Annual Incentive Plan(1)  1,162,603 3,487,808
Performance Share Units(2) — 
Restricted Stock Units(3) 9/22/2020 2,354 499,943
Stock Options(4)
Kevin Jacobsen
Annual Incentive Plan(1) 630,000 1,890,000
Performance Share Units(2) 9/22/2020 4,808 9,616 1,021,123
Restricted Stock Units(3) 9/22/2020 1,602 340,233
Stock Options(4) 9/22/2020 11,000 212.38 340,450
Eric Reynolds
Annual Incentive Plan(1) 700,000 2,100,000
Performance Share Units(2)  9/22/2020 5,932 11,864 1,259,838
Restricted Stock Units(3) 9/22/2020 1,977 419,875
Stock Options(4) 9/22/2020 13,573 212.38 420,084
Tony Matta
Annual Incentive Plan(1) 391,524 1,174,571
Performance Share Units(2) 10/5/2020 2,869 5,738 599,937
Restricted Stock Units(3) 10/5/2020 8,129 1,699,855
Stock Options(4) 10/5/2020 6,072 209.11 199,951
Kirsten Marriner
Annual Incentive Plan(1) 454,538 1,363,613
Performance Share Units(2)  9/22/2020 3,390 6,780 719,968
Restricted Stock Units(3) 9/22/2020 1,130 239,989
Stock Options(4) 9/22/2020 7,756 212.38 240,048
(1)

Represents estimated possible payouts of annual incentive awards for fiscal year 2021 under the AIP for each of our named executive officers. The AIP is an annual cash incentive opportunity and, therefore, awards are earned in the year of grant. The target amounts represent the potential payout if both Clorox performance, including financial and strategic metrics, and individual performance are at target levels. The maximum amount represents maximum payout in the AIP utilizing a Company Multiplier of 200% and an Individual Multiplier of 150% for all executive officers. See the Summary Compensation Table for the actual payout amounts in fiscal year 2021 under the AIP. See Annual Incentives in Compensation Discussion and Analysis for additional information about the AIP.

(2)

Represents possible future payouts of Clorox common stock underlying PSUs awarded in fiscal year 2021 to each of our currently active named executive officers as part of their participation in the 2005 Stock Incentive Plan. These awards will vest upon the achievement of performance measures based on average annual economic profit growth over a three-year period, with the threshold, target, and maximum awards equal to 0%, 100%, and 200%, respectively, of the number of PSUs granted. If the minimum financial goals are not met at the end of the three-year period, no PSU awards will be paid out under the 2005 Stock Incentive Plan. See Long-Term Incentives in Compensation Discussion and Analysis for additional information.


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(3)

Represents RSUs awarded to each of our named executive officers under the 2005 Stock Incentive Plan. All RSUs vest in equal installments on the first, second, third, and fourth anniversaries of the grant date other than the one-time off-cycle award of 7,173 RSUs granted to Mr. Matta when he was hired as Executive Vice President and Chief Growth Officer, which vest in equal installments on the first, second and third anniversaries of the grant date.

(4)

Represents stock options awarded to each of our named executive officers under the 2005 Stock Incentive Plan. All stock options vest in equal installments on the first, second, third, and fourth anniversaries of the grant date.



Outstanding Equity Awards at Fiscal Year-End – 2021

The following equity awards granted to our NEOs were outstanding as of the end of fiscal year 2021.

Option Awards Stock Awards
Name Number of
Securities
Underlying
Unexercised
Options-
Exercisable
(#)
Number of
Securities
Underlying
Unexercised
Options-
Unexercisable
(#)
Option
Exercise
Price
($)
Option
Expiration
Date
Number
of
Shares
or Units
of Stock
That
Have Not
Vested
(#)
Market
Value of
Shares
or Units
of Stock
That
Have Not
Vested
($)
Equity
Incentive
Plan
Awards:
Number of
Unearned
Shares,
Units or
Other Rights
That Have
Not Vested
(#)
Equity
Incentive
Plan Awards:
Market or
Payout Value
of Unearned
Shares, Units
or Other
Rights That
Have Not
Vested
($)(1)
Linda Rendle                        
Stock Options(2)  1,697 72.11 9/11/2022
2,935 84.45 9/17/2023
7,850 89.82 9/17/2024
12,360 111.60 9/15/2025
14,560 123.09 9/13/2026
15,352 5,118 (3)    135.57 9/12/2027
9,520 9,520 (4)    151.85 9/18/2028
3,466 3,466 (5)    154.88 1/7/2029
12,488 37,467 (6)    155.54 9/17/2029
          32,316 (7)    212.38 9/22/2030
Performance Share Units(2)  2,632 (10)  473,523
1,062 (11)  191,100
6,429 (12)  1,156,641
         14,125 (13)  2,541,229
Restricted Stock Units(2)     4,708 (15)    847,016
Benno Dorer                      
Stock Options(2)  42,990 135.57 2/15/2026
128,800 151.85 2/15/2026
147,367 155.54 2/15/2026
Performance Share Units(2)  15,817 (10)  2,845,705
10,537 (12)  1,895,712
Restricted Stock Units(2)  2,354 (15)    423,508

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Compensation Discussion and Analysis Tables

Option Awards Stock Awards
Name    Number of
Securities
Underlying
Unexercised
Options-
Exercisable
(#)
   Number of
Securities
Underlying
Unexercised
Options-
Unexercisable
(#)
   Option
Exercise
Price
($)
   Option
Expiration
Date
   Number
of
Shares
or Units
of Stock
That
Have Not
Vested
(#)
Market
Value of
Shares
or Units
of Stock
That
Have Not
Vested
($)
   Equity
Incentive
Plan
Awards:
Number of
Unearned
Shares,
Units or
Other Rights
That Have
Not Vested
(#)
Equity
Incentive
Plan Awards:
Market or
Payout Value
of Unearned
Shares, Units
or Other
Rights That
Have Not
Vested
($)(1)
Kevin Jacobsen   
Stock Options(2)               2,458 (3)  135.57 9/12/2027
2,790 2,790 (8)  128.69 4/2/2028
14,560 14,560 (4)  151.85 9/18/2028
8,742 26,226 (6)  155.54 9/17/2029
11,000 (7)  212.38 9/22/2030
Performance Share Units(2)                  4,023 (10)  723,814
4,500 (12)  809,595
4,808 (13)  865,007
Restricted Stock Units(2)       1,602 (15)  288,216
Eric Reynolds
Stock Options(2)  15,210 111.60 9/15/2025
15,470 123.09 9/13/2026
12,285 4,095 (3)  135.57 9/12/2027
6,720 6,720 (4)  151.85 9/18/2028
2,971 2,971 (5)  154.88 1/7/2029
8,117 24,353 (6)  155.54 9/17/2029
13,573 (7)  212.38 9/22/2030
Performance Share Units(2)  1,861 (10)  334,848
910 (11)  163,704
4,178 (12)  751,664
5,932 (13)  1,067,226
Restricted Stock Units(2)  1,977 (15)  355,682
Tony Matta
Stock Options(2)  6,072 (9)  209.11 10/5/2030
Performance Share Units(2)  2,869 (14)  516,162
Restricted Stock Units(2)  7,173 (16)  1,290,494
956 (15)  171,994
Kirsten Marriner
Stock Options(2)  6,143 (3)  135.57 9/12/2027
9,520 9,520 (4)  151.85 9/18/2028
5,932 17,796 (6)  155.54 9/17/2029
7,756 (7)  212.38 9/22/2030
Performance Share Units(2)  2,632 (10)  473,523
3,053 (12)  549,265
3,390 (13)  609,895
Restricted Stock Units(2)  1,130 (15)  203,298
(1) Represents unvested “target” number of PSUs under the 2005 Stock Incentive Plan multiplied by the closing price of our common stock on June 30, 2021, except as noted below in footnotes (10) and (11). The ultimate value will depend on whether performance criteria are met and the value of our common stock on the actual vesting date.

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(2) Awards were granted under the 2005 Stock Incentive Plan.
(3) Represents the unvested portion of stock options that vest in four equal installments beginning one year from the grant date of September 13, 2017.
(4) Represents the unvested portion of stock options that vest in four equal installments beginning one year from the grant date of September 12, 2018.
(5) Represents the unvested portion of off-cycle stock options granted to Ms. Rendle and Mr. Reynolds when they were promoted to Executive Vice President, Strategy and Operations and Executive Vice President, Cleaning and Burt’s Bees, respectively, effective January 7, 2019. Options vest in four equal installments beginning one year from the grant date of January 7, 2019.
(6) Represents the unvested portion of stock options that vest in four equal installments beginning one year from the grant date of September 18, 2019.
(7) Represents the unvested portion of stock options that vest in four equal installments beginning one year from the grant date of September 22, 2020.
(8) Represents the unvested portion of off-cycle stock options granted to Mr. Jacobsen when he was promoted to Senior Vice President, Chief Financial Officer, effective April 1, 2018. Options vest in four equal installments beginning one year from the grant date of April 2, 2018.
(9) Represents the unvested portion of stock options that vest in four equal installments beginning one year from the grant date of October 5, 2020.
(10) Represents the actual number of PSUs that were paid out under our 2005 Stock Incentive Plan. The awards from the plan have a three-year performance period (fiscal years 2019 through 2021). Performance is based on achievement of average annual economic profit growth. After completion of fiscal year 2021, the Committee determined whether the performance measures had been achieved and based on the results, on August 12, 2021, the Committee approved the payout of this award at 94% of target.
(11) Represents the actual number of PSUs that were paid out under our 2005 Stock Incentive Plan. The off-cycle awards from the plan, which were granted to Ms. Rendle and Mr. Reynolds when they were promoted to Executive Vice President, Strategy and Operations and Executive Vice President, Cleaning and Burt’s Bees, respectively, effective January 7, 2019, have a three-year performance period (fiscal years 2019 through 2021). Performance is based on achievement of average annual economic profit growth. After completion of fiscal year 2021, the Committee determined whether the performance measures had been achieved and based on the results, on August 12, 2021, the Committee approved the payout of this award at 94% of target.
(12) Represents the “target” number of PSUs that can be earned under our 2005 Stock Incentive Plan. The awards from the plan have a three-year performance period (fiscal years 2020 through 2022). Performance is based on achievement of average annual economic profit growth. The Committee will determine whether the performance measures have been achieved after the completion of fiscal year 2022.
(13) Represents the “target” number of PSUs that can be earned under our 2005 Stock Incentive Plan. The awards from the plan have a three-year performance period (fiscal years 2021 through 2023). Performance is based on achievement of average annual economic profit growth. The Committee will determine whether the performance measures have been achieved after the completion of fiscal year 2023.
(14) Represents the “target” number of PSUs that can be earned under our 2005 Stock Incentive Plan. The off-cycle award from the plan, which was granted to Mr. Matta effective October 5, 2020, when he was hired to Executive Vice President and Chief Growth Officer, has a three-year performance period (fiscal years 2021 through 2023). Performance is based on achievement of average annual economic profit growth. The Committee will determine whether the performance measures have been achieved after the completion of fiscal year 2023.
(15) Represents unvested portion of RSUs that vest in four equal installments beginning one year from the grant date of September 22, 2020.
(16) Represents unvested one-time off-cycle RSUs granted to Mr. Matta when he was hired as Executive Vice President and Chief Growth Officer, effective October 5, 2020. RSUs vest in three equal installments beginning one year from the grant date of October 5, 2020.

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Compensation Discussion and Analysis Tables


Option Exercises and Stock Vested – Fiscal Year 2021

This table shows stock options exercised and stock vested for the NEOs during fiscal year 2021.

Option Awards Stock Awards
Name       Number of
Shares Acquired
on Exercise
(#)
     Value
Realized
on Exercise
($)(1)
      Number of
Shares Acquired
on Vesting
(#)
     Value
Realized
on Vesting
($)(2)
Linda Rendle               5,112 (4,5)  952,376
Benno Dorer             467,220 (3)  36,772,432 26,268 (6)  5,996,984
Kevin Jacobsen 35,282 (3)  3,244,819 1,505 (6)  286,951
Eric Reynolds 2,495 (6)  569,609
Tony Matta
Kirsten Marriner 65,367 (3)  5,371,426 3,758 (7)  857,951
(1) The dollar value realized reflects the difference between the market price of Clorox common stock upon exercise and the stock option exercise price.
(2) The dollar value realized reflects the market value of the vested shares and dividend equivalent units based on the closing price of Clorox common stock on the vesting date. For deferred shares, the dollar value realized reflects the market value of the vested shares and dividend equivalent units based on the closing price of Clorox common stock on June 30, 2021. Amount includes income related to deferred dividends from fiscal year 2020 recognized in fiscal year 2021 for Ms. Rendle ($35,158) and Mr. Jacobsen ($16,894). No other NEO had such deferred dividends in fiscal year 2020.
(3) The number of shares represents the exercise of nonqualified stock options granted in previous years under Clorox’s 2005 Stock Incentive Plan.
(4) The number of shares represents the vesting of RSUs, PSUs, and dividend equivalent units granted through participation in Clorox’s 2005 Stock Incentive Plan.
(5) 3,133 of these shares have been deferred and will be distributed over 5 annual installments after separation.
(6) The number of shares represents the vesting of PSUs and dividend equivalent units granted through participation in Clorox’s 2005 Stock Incentive Plan.
(7) These shares have been deferred and will be distributed over 5 annual installments after separation.


Pension Benefits – Fiscal Year 2021

Name(1)       Plan Name       Number
of Years of
Credited Service
(#)(2)
      Present Value
of Accumulated
Benefit
($)(3)
      Payments
During Last
Fiscal Year
($)
Linda Rendle The Clorox Company Pension Plan(4) 18 53,435
Benno Dorer The Clorox Company Pension Plan(4) 16 59,168
Supplemental Executive Retirement Plan(5) 16 4,604,358
Cash Balance Restoration(6) 16 182,769
Kevin Jacobsen The Clorox Company Pension Plan(4) 25 141,008
Cash Balance Restoration(6) 25 58,154
Eric Reynolds The Clorox Company Pension Plan(4) 22 104,581
Cash Balance Restoration(6) 22 2,591
Tony Matta The Clorox Company Pension Plan(4)
Kirsten Marriner The Clorox Company Pension Plan(4)
(1) Only Mr. Dorer participates in the SERP. Only Messrs. Dorer, Jacobsen, and Reynolds participate in the Cash Balance Restoration plan. Mr. Matta and Ms. Marriner do not participate in any of the pension plans.
(2) Number of years of credited service is rounded down to the nearest whole number.
(3) Present value of the accumulated benefit was calculated using the following assumptions: MILES-CGFD mortality table; 2.50% discount rate; and age as of June 30, 2021.
(4) The Pension Plan was frozen effective July 1, 2011. Participants keep their accumulated pay credits and receive only quarterly interest credits after that date.

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(5) The SERP was frozen regarding pay and offsets effective June 30, 2011. Age and service credits continue to accrue. Mr. Dorer is the only NEO eligible for the SERP.
(6) The cash balance restoration provision in the NQDC was eliminated effective July 1, 2011, when the Pension Plan was frozen. Participants keep their accumulated pay credits but no contributions were made under this provision after July 1, 2011.

Overview of Pension Benefits

Historically, pension benefits have been paid to the NEOs under the following plans: (1) the Pension Plan, (2) the cash balance restoration provision in the NQDC, and (3) the SERP. Effective June 30, 2011, the Pension Plan and the cash balance restoration provision under

the NQDC were frozen. The SERP was also frozen as of June 30, 2011, for pay and offsets, while still allowing age and service credits, as most recently amended in March 2018, as described in the Retirement Plans section of the CD&A.



Nonqualified Deferred Compensation – Fiscal Year 2021

The following table provides information regarding the accounts of the NEOs under the NQDC and ERP in fiscal year 2021.

Name       Executive
Contributions
in Last FY
($)(1)
      Registrant
Contributions
in Last FY
($)(2)
      Aggregate
Earnings
in Last FY
($)(3)
      Aggregate
Balance
at Last FYE
($)(4)(5)
Linda Rendle 93,981 300,977 295,265 1,323,915
Benno Dorer 180,905 658,865 69,484 5,508,013
Kevin Jacobsen 297,923 220,334 239,559 1,892,213
Eric Reynolds 60,027 227,035 176,966 972,548
Tony Matta 11,538 6,010 1,284 18,832
Kirsten Marriner 45,890 184,160 177,213 766,571
(1) Amounts represent the annual base salary and incentive award that each executive deferred during fiscal year 2021. Deferred base salary is also reported in the Summary Compensation Table – Salary. Deferred annual incentive awards are also reported in the Summary Compensation Table – Non-Equity Incentive Plan Compensation.
(2) Represents that portion of the Clorox 401(k) match and annual contribution of up to 10% of eligible compensation that is in excess of IRC compensation limits, pursuant to the 401(k) restoration provision of the NQDC and the Clorox contribution under the ERP. These contributions are also reported in the Summary Compensation Table – All Other Compensation and are included under the caption Nonqualified Deferred Compensation Plan in footnote (7) to the Summary Compensation Table.
(3) Earnings are based on an array of investment options that generally mirror the 401(k) Plan. Earnings vary based on participant investment elections.
(4) Reflects aggregate balances under the restoration provision of the NQDC, ERP contributions, and any deferred base salary and annual incentive awards, plus earnings, as of the end of fiscal year 2021.
(5) The executive and registrant contribution total amounts in the table below are also reported as compensation in the Summary Compensation Table in the years indicated:

       Fiscal Year       Linda
Rendle
      Benno
Dorer
      Kevin
Jacobsen
      Eric
Reynolds
      Tony
Matta
      Kirsten
Marriner
  2021 $ 394,957 $ 839,770 $ 518,257 $ 287,062 $ 17,548 $ 230,049
  2020 104,278 334,391 98,548 83,960
  2019 $ 83,562 $ 329,899 $ 68,694 $ 63,278

Overview of Nonqualified Deferred Compensation Plans

Executive Retirement Plan

Our executive officers are eligible for participation in the ERP. The ERP provides that Clorox will make an annual contribution of 5% of an eligible participant’s base salary plus annual incentive payment into the ERP.

Clorox contributions vest over a three-year period and individuals are considered retirement-eligible under the ERP upon attainment of age 62 with 10 years of service with Clorox. An eligible participant may elect distribution in a lump sum or up to 15 annual installments upon a qualifying payment event.


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Nonqualified Deferred Compensation Plan

Under the NQDC, participants may voluntarily defer the receipt of up to 50% of their base salary and up to 100% of their annual incentive award. In addition, the NQDC offers a 401(k) restoration provision for those who defer at a required level. All Clorox retirement contributions are made in the form of (i) a fixed 6% employer annual contribution and (ii) an employer match of up to 4% of pay into the 401(k) Plan, subject to IRC limits. Contributions on eligible compensation that exceed the IRC limits are contributed into a participant’s NQDC account under the 401(k) restoration provision.

Participants in the NQDC may elect to receive benefits from the NQDC either in a lump sum or up to 15 annual payments upon a qualifying payment event. Participants may choose from an array of investment crediting rates that generally mirror the investment fund options available in the 401(k) Plan. The NQDC uses the same benefit formulas, types of compensation to determine benefits, and vesting requirements as the 401(k) Plan. The responsibility to pay benefits under the NQDC is an unfunded and unsecured obligation of Clorox.



Potential Payments Upon Termination or Change in Control – Fiscal Year 2021

The following table reflects the estimated amount of compensation payable to each of our NEOs upon termination of the NEO’s employment under various scenarios. The amounts exclude earned amounts such as vested or accrued benefits.

The amounts shown are calculated using an assumed termination date effective as of, and the closing trading price of our common stock of $179.91 on, the last business day of fiscal year 2021 (June 30, 2021). Although the calculations are intended to provide reasonable estimates of the potential compensation

payable upon termination, they are based on assumptions outlined in the footnotes of the table and may not represent the actual amount the NEO would receive if an eligible termination event were to occur.

The table does not include compensation or benefits provided under plans or arrangements that are generally available to all salaried employees. Amounts reflected for change in control assume that each NEO is involuntarily terminated by Clorox without cause or voluntarily terminates for good reason within two years after a change in control.


Name and Benefits       Involuntary
Termination
Without Cause
($)
      Involuntary
Termination
After Change
In Control
($)
      Resignation or
Retirement
($)
      Disability or
Death
($)
Linda Rendle
Cash Payment    6,181,250 (1)  9,675,000 (2)  (3) (4)
Stock Options 4,180,879 (5)  5,674,743 (6)  5,879,968 (7) 
Restricted Stock Units 847,016 (8)  847,016 (8) 
Performance Share Units 4,545,288 (9)  4,545,288 (10) 
Retirement Plan Benefits
Health & Welfare Benefits 36,720 (11)  55,080 (12) 
Financial Planning 16,500 (13) 
Total Estimated Value 10,398,849 20,813,626 11,272,272
Kevin Jacobsen
Cash Payment 2,030,000 (14)  3,290,000 (15)  (3) (4)
Stock Options 2,866,651 (5)  2,866,651 (6)     2,866,651 (5)  2,866,651 (7) 
Restricted Stock Units 288,216 (16)  288,216 (8)  288,216 (16)  288,216 (8) 
Performance Share Units 1,675,754 (17) 2,544,395 (9) 1,675,754 (17) 2,544,395 (10)
Retirement Plan Benefits
Health & Welfare Benefits 37,944 (11) 37,944 (12)
Financial Planning 16,500 (13)
Total Estimated Value 6,898,565 9,043,705 4,830,621 5,699,261

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Name and Benefits       Involuntary
Termination
Without Cause
($)
      Involuntary
Termination
After Change
In Control
($)
      Resignation or
Retirement
($)
      Disability or
Death
($)
Eric Reynolds
Cash Payment 2,100,000 (14) 3,500,000 (15) (3) (4)
Stock Options   4,540,372 (5)   4,540,372 (6)     4,540,372 (5) 4,540,372 (7)
Restricted Stock Units 355,682 (16) 355,682 (8) 355,682 (16) 355,682 (8)
Performance Share Units 1,448,184 (17) 2,434,004 (9) 1,448,184 (17) 2,434,004 (10)
Retirement Plan Benefits
Health & Welfare Benefits 13,284 (11) 13,284 (12)
Financial Planning 16,500 (13)
Total Estimated Value 8,457,522 10,859,842 6,344,238 7,330,058
Tony Matta
Cash Payment 1,648,438 (14) 2,452,885 (15) (3) (4)
Stock Options (6) 32,248 (7)
Restricted Stock Units 1,462,488 (8) 1,462,488 (8)
Performance Share Units 525,716 (9) 525,716 (10)
Retirement Plan Benefits
Health & Welfare Benefits 26,274 (11) 26,274 (12)
Financial Planning 16,500 (13)
Total Estimated Value 1,674,712 4,483,863 2,020,451
Kirsten Marriner
Cash Payment 1,601,563 (14) 2,656,250 (15) (3) (4)
Stock Options 411,694 (5) 1,384,894 (6) 1,519,452 (7)
Restricted Stock Units 203,298 (8) 203,298 (8)
Performance Share Units 1,729,829 (9) 1,729,829 (10)
Retirement Plan Benefits
Health & Welfare Benefits 36,960 (11) 36,960 (12)
Financial Planning 16,500 (13)
Total Estimated Value 2,050,217 6,027,731 3,452,579
(1)

This amount reflects two times Ms. Rendle’s current base salary plus two times 75% of her target AIP award. In addition, the amount includes 100% of her current year target AIP award, pro-rated to the date of termination.

(2)

This amount represents three times Ms. Rendle’s current base salary, plus three times her target AIP award, plus her current-year AIP award, pro-rated to the date of termination, subject to the excise tax cutback provision in the CIC Plan.

(3)

Messrs. Jacobsen and Reynolds are eligible for retirement, including a pro-rata AIP award upon retirement. Mses. Rendle and Marriner and Mr. Matta are not eligible for retirement, nor for a pro-rata annual incentive award upon retirement. However, all bonus-eligible employees active as of June 30, 2021 are eligible to receive an annual incentive award, so a pro-rata AIP award would not be applicable based on the assumed termination date of June 30, 2021, regardless of retirement eligibility.

(4)

NEOs whose termination is the result of disability or death are eligible to receive a pro-rata AIP award through the date of termination. However, all bonus-eligible employees active as of June 30, 2021 are eligible to receive an annual incentive award, so a pro-rata AIP award would not be applicable based on the assumed termination date of June 30, 2021.

(5)

For Messrs. Jacobsen and Reynolds, who are retirement-eligible, this amount represents the expected value of the accelerated vesting of all outstanding stock options, and assumes a five-year expected life or the remaining original term, whichever is shorter. For Mses. Rendle and Marriner and Mr. Matta, this amount represents the intrinsic value of vested stock options at termination, based on the provision that non-retirement eligible executives exercise stock options within 90 days of termination, calculated as the difference between the June 30, 2021 closing Clorox common stock price of $179.91 and the exercise price for each option.

(6)

For Messrs. Jacobsen and Reynolds, who are retirement-eligible, this amount represents the expected value of the accelerated vesting of all outstanding stock options, and assumes a five-year expected life or the remaining original term, whichever is shorter. For Mses. Rendle and Marriner and Mr. Matta, this amount represents the intrinsic value of the accelerated vesting of all outstanding stock options, based on the provision that non-retirement eligible executives exercise stock options within 90 days of termination, calculated as the difference between the June 30, 2021 closing Clorox common stock price of $179.91 and the exercise price for each option.


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(7)

For Messrs. Jacobsen and Reynolds, who are retirement-eligible, this amount represents the expected value of the accelerated vesting of all outstanding stock options upon the NEO’s termination of employment due to disability or death, and assumes a five-year expected life or the remaining original term, whichever is shorter. For Mses. Rendle and Marriner and Mr. Matta, this amount represents the expected value of the accelerated vesting of all outstanding stock options, based on the provision that non-retirement eligible executives exercise stock options within one year of disability or death, calculated as the difference between the June 30, 2021 closing Clorox common stock price of $179.91 and the exercise price for each option.

(8)

This amount represents the value of the accelerated vesting of RSUs upon change in control, disability, or death.

(9)

PSUs will vest based on performance through the date of the change in control. This amount assumes a pro-rated target payout and is valued at the closing price of Clorox common stock on June 30, 2021 of $179.91.

(10)

This amount represents the value of the accelerated vesting of PSUs upon a disability or death, assuming a target payout and valued at the closing price of Clorox common stock on June 30, 2021 of $179.91. Upon termination for disability or death, the entire PSU award will vest. The actual payout will not be determined until the end of the performance period.

(11)

This amount represents the estimated cost to Clorox of providing welfare benefits, including medical, dental, and vision, for the two-year period following termination.

(12)

This amount represents the estimated cost to Clorox of providing welfare benefits, including medical, dental, and vision, for the two-year period (three-year period for Ms. Rendle) following a qualifying termination after a change in control.

(13)

This amount represents the cost of providing financial planning for the year of termination.

(14)

This amount reflects two times the NEO’s current base salary. In addition, for Messrs. Jacobsen and Reynolds, who are eligible for retirement, this amount includes 100% of their current year target AIP award, pro-rated to the date of termination. For Mses. Rendle and Marriner and Mr. Matta, this amount includes 75% of their current year’s target AIP award, pro-rated to the date of termination.

(15)

This amount represents two times the named executive officer’s current base salary, plus two times the target AIP award, subject to the excise tax cutback provision in the CIC Plan. For Messrs. Jacobsen and Reynolds, who are eligible for retirement, this amount also includes 100% of their current year target AIP award, pro-rated to the date of termination. For Mses. Rendle and Marriner and Mr. Matta, this amount includes the target AIP award, pro-rated to the date of termination.

(16)

Messrs. Jacobsen and Reynolds are retirement-eligible and all unvested RSUs held longer than six months will continue to vest after termination. This amount represents the expected value of the continued vesting of such RSUs.

(17)

Messrs. Jacobsen and Reynolds are eligible for retirement and are entitled to receive a pro-rata portion of all PSUs for the September 2018, 2019 and 2020 awards. This value represents the full vesting of eligible shares from the September 2018 award, since they would have completed the entire performance period as of the assumed termination date of June 30, 2021, and the pro-rata vesting of the eligible shares from the September 2019 and 2020 awards, assuming a target payout and valued at the closing price of Clorox common stock on June 30, 2021 of $179.91. The actual payout of the shares will not be determined until the end of the performance period. NEOs who are not retirement-eligible forfeit shares upon termination under these scenarios.

Retirement Payments to Former NEO

On February 15, 2021, Mr. Dorer retired from employment with Clorox. As a result, Mr. Dorer received benefits consistent with a retirement as described below. The value of benefits received due to such separation, calculated as of February 15, 2021, in a manner consistent with the calculations for resignation in the “Potential Payments” table, was $18,573,973.

Potential Payments Upon Termination

Severance Plan

Under the terms of the Severance Plan, our NEOs are eligible to receive benefits if their employment is terminated by Clorox without cause, other than in connection with a change in control. No benefits are payable under the terms of the Severance Plan if Clorox terminates the employment of the NEO for cause or if the NEO voluntarily resigns.

Regardless of the nature of any NEO’s termination, NEOs retain amounts earned over the course of their employment prior to the termination event, such as balances under the NQDC, vested and accrued retirement benefits, and previously vested stock

options, except as outlined below under Termination for Misconduct. For further information about amounts previously earned, see the Summary Compensation Table, Outstanding Equity Awards at Fiscal 2020 Year-End Table, Option Exercises and Stock Vested Table, Pension Benefits Table, and Nonqualified Deferred Compensation Table.

Under the Severance Plan, each NEO agrees to return and not to use or disclose proprietary information of Clorox and, for two years following any such termination, the NEO is also prohibited from soliciting for employment any employee of Clorox.

Termination benefits under the Severance Plan for our NEOs are as follows:

Involuntary Termination Without Cause. If Clorox terminates the employment of a NEO other than the CEO without cause, the Severance Plan entitles the NEO to receive a lump-sum severance payment after termination equal to two times the NEO’s then-current base salary. In the case of the CEO, the severance amount is equal to the sum of (i) two times the CEO’s base salary and (ii) two times the CEO’s target annual bonus for that fiscal year, multiplied by 75%.


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Under the Severance Plan, NEOs other than the CEO are also entitled to an amount equal to 75% of their AIP awards for the fiscal year in which they are terminated. The CEO is entitled to an amount equal to 100% of her AIP award for the fiscal year in which she was terminated. In each case, the AIP award calculation uses the actual Company Multiplier for the fiscal year in which the executive is terminated, assumes an Individual Multiplier of 100%, and is prorated to the date of termination.

NEOs who are retirement-eligible under the terms of the AIP are eligible for either the treatment under the Severance Plan (75%) or retirement treatment (100%) for purposes of the AIP award payout. The MDCC decides which treatment to apply; in either case, the AIP award payout would remain prorated to the date of termination.

The Severance Plan provides that a NEO is entitled to continue to participate in our medical, vision, and dental insurance programs for up to two years following termination on the same terms as active employees. In addition, at the end of this coverage, a NEO will be eligible to participate in any combination of our medical, vision, and dental plans offered to former employees who retire at age 55 or older, on the same terms as such other former employees, provided the NEO has completed at least 10 years of service. Where applicable, this coverage continues until the NEO turns age 65. Thereafter, the NEO may participate in our general retiree health plan as it may exist in the future, if otherwise eligible. If the NEO will be age 55 or older and will have completed at least 10 years of service at the end of, and including, the two-year period following termination, the NEO will be deemed to be age 55 and to have 10 years of service under any pre-65 retiree health plan as well as the SERP.

Severance-related benefits are provided only if the NEO executes a general release prepared by Clorox.

Termination Due to Retirement. Under Clorox’s policy applicable to all employees, upon retirement NEOs are entitled to their salary through the last day of employment and are eligible for a pro-rata portion of the AIP award for the fiscal year in which their retirement occurs. Based on the provisions of the respective plans, they also will be eligible to receive SERP, ERP, and other benefits under applicable Clorox retirement plans. In addition to the amounts that the NEO has earned or accrued over the course of their employment under our qualified and nonqualified plans, a NEO who is at least age 55 with 10 years of service or who has 20 years of service

regardless of age is eligible to receive retirement-related benefits under the long-term incentive program. Stock options held for longer than six months will vest in full in accordance with the original vesting schedule and remain exercisable for five years following the NEO’s retirement or until the expiration date, whichever is sooner, and PSUs will be paid out on a pro-rata basis at the end of the relevant performance period based on the actual level of performance achieved during that period. Beginning with the fiscal year 2021 awards, RSUs held for longer than six months will vest in full in accordance with the original vesting schedule.

Termination Due to Disability or Death. If a NEO begins to receive benefits under our long-term disability plan, Clorox may terminate the NEO’s employment at any time, in which case the NEO will receive their salary through the date of their termination and will also be entitled to a pro-rata portion of their actual AIP award for the fiscal year of termination. Stock options will vest in full, and all vested options will remain exercisable for an additional year following the NEO’s disability or until the expiration date, whichever is earlier, and all PSUs will be paid out at the end of the relevant performance period based on the actual level of performance achieved during that period.

Under Clorox’s policy applicable to all employees, if a NEO’s employment is terminated due to death, the NEO’s beneficiary or estate is entitled to (i) the NEO’s salary through the date of death, (ii) a pro-rata portion of the NEO’s actual AIP award for the fiscal year of death, (iii) a pro-rata portion of the NEO’s 6% annual contribution to the 401(k) plan for the fiscal year of death, and (iv) benefits pursuant to our life insurance plan. Stock options and RSUs will vest in full, and all vested options remain exercisable for an additional year following the NEO’s death or until the expiration date, whichever is earlier, and all PSUs will be paid out at the end of the relevant performance period based on the actual level of performance achieved during that period.

Termination for Misconduct. Clorox may terminate a NEO’s employment for misconduct at any time without notice. Upon the NEO’s termination for misconduct, the NEO is entitled to their salary through the date of their termination but is not entitled to any AIP award for the fiscal year in which their termination for misconduct occurs. “Misconduct” under the Severance Plan means any act or omission of the NEO through which the NEO: (i) willfully neglects significant duties he or she is required to perform or willfully violates a material Clorox policy, and, after being warned in writing, continues to neglect such duties or continues to violate the specified Clorox


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policy; (ii) commits a material act of dishonesty, fraud, misrepresentation or other act of moral turpitude; (iii) acts (or omits to act) with gross negligence in the course of employment; (iv) fails to obey a lawful direction of the Board or, for NEOs other than the CEO, a corporate officer to whom he or she reports, directly or indirectly; or (v) acts in any other manner inconsistent with Clorox’s best interests and values.

All outstanding stock options and RSUs awards are forfeited upon a termination for misconduct. In addition, any retirement-related benefits a NEO would normally receive related to PSUs are also forfeited upon a termination for misconduct.

Voluntary Termination. A NEO may resign from employment at any time. Upon a NEO’s voluntary resignation, the NEO is entitled to their salary through the date of termination but is not entitled to any AIP award for the fiscal year of termination. All unvested outstanding stock options, RSUs, and PSUs are forfeited upon voluntary termination.

Potential Payments Upon Change in Control

Executive Change in Control Severance Plan

Under the CIC Plan, executives are eligible for change in control severance benefits, subject to the execution of a waiver and release, if they are terminated without cause or resign for good reason as defined under the CIC Plan during (i) the two-year period following a change in control or (ii) a period of up to one year prior to the change in control in limited circumstances where the executive’s termination is directly related to or in anticipation of a change in control.

The severance benefits under the CIC Plan include (i) a lump-sum severance payment equal to two times—or, in the case of the CEO, three times—the sum of (a) the executive’s base salary and (b) average AIP award for the three completed fiscal years prior to termination, (ii) a lump-sum amount equal to the difference between the actuarial equivalent of the benefit the NEO would have been entitled to receive if their employment had continued until the second anniversary of the date of termination and the actuarial equivalent of the aggregate benefits paid or payable as of the date of termination under the qualified and nonqualified retirement plans, (iii) a payment equal to the cost of applicable healthcare benefits for a maximum of two—or, in the case of the CEO, three—years following a severance-qualifying

termination, (iv) continued financial planning services for the year of termination, (v) vesting of all outstanding equity awards granted prior to the change in control, and (vi) an amount equal to the average AIP award for the three completed fiscal years preceding termination prorated for the number of days employed in the fiscal year during which termination occurred.

In addition, the CIC Plan provides for an excise tax cutback such that the excise tax under Sections 280G and 4999 of the IRC would not apply, unless the executive would receive a greater amount of severance benefits on an after-tax basis without a cutback, in which case the cutback would not apply. The CIC Plan permits the MDCC to make changes to the CIC Plan that are adverse to covered executives with 12 months’ advance notice. If a change in control of Clorox occurs during that 12-month period, then such changes would not become effective. Each participant under the CIC Plan is subject to certain restrictive covenants including confidentiality and non-disparagement provisions and a non-solicitation and non-diversion of business provision during the term of their employment and for two years thereafter.

“Cause” is generally defined as (i) willful and continued failure to substantially perform duties upon written demand or (ii) willfully engaging in illegal conduct or gross misconduct that is materially and demonstrably injurious to Clorox. A termination for cause requires a vote of 75% of the Board at a meeting after notice to the executive has been given and the executive has had an opportunity to be heard.

“Good Reason” is generally defined as (i) an assignment of duties inconsistent in any material respects with the executive officer’s position (including offices and reporting requirements), authority, duties, or responsibilities (ii) any failure to substantially comply with, or any reduction by Clorox in, any of the material provisions of compensation plans, programs, agreements, or arrangements as in effect immediately prior to the change in control, including any material reduction in base salary, cash incentive compensation target bonus opportunity, equity compensation opportunity in the aggregate, or employee benefits or perquisites in the aggregate, (iii) relocation of principal place of employment that increases the executive officer’s commuting distance by more than 35 miles, (iv) termination of employment by Clorox other than as expressly permitted by the CIC Plan, or (v) failure of a successor company to assume the CIC Plan.


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Compensation Discussion and Analysis Tables


Fiscal Year 2021 CEO Pay Ratio

Under rules adopted by the SEC under the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (the Dodd-Frank Act), we are required to disclose the ratio of the annual total compensation of our CEO to the annual total compensation of our median compensated employee. We calculated annual total compensation for that employee using the same methodology we use for our NEOs as set forth in the Summary Compensation Table in this proxy statement.

Total compensation for our median employee was $69,365.

Our CEO to median employee pay ratio is 114:1.

The pay ratio reported here is a reasonable estimate calculated in a manner consistent with SEC rules.

To identify our median employee for purposes of this disclosure, we first determined the pool of all individuals employed by us, other than the CEO, on June 20, 2019, and reviewed total cash compensation earned by each such individual during fiscal year 2019. We did not make any assumptions, adjustments, or estimates with respect to total cash compensation and no exclusions were used during this process. We selected our median

employee from that pool in accordance with the SEC rules as explained in our proxy statement for fiscal year 2019. We believe there has been no change to our employee population and compensation arrangements, or the circumstances of the median employee used in fiscal years 2019 and 2020 that we believe would result in a significant change to our pay ratio disclosure. Accordingly, as permitted under SEC rules, we are using the same median employee to calculate our fiscal year 2021 CEO pay ratio.

The SEC’s rules for identifying the median compensated employee and calculating the pay ratio based on that employee’s annual total compensation allow companies to adopt a variety of methodologies, to apply certain exclusions, and to make reasonable estimates and assumptions that reflect their employee populations and compensation practices. As a result, the pay ratio reported by other companies, including our compensation peer group, may not be comparable to the pay ratio reported above, as other companies have different employee populations and compensation practices and may use different methodologies, exclusions, estimates and assumptions in calculating their own pay ratios.


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Equity Compensation Plan Information

The following table sets out the number of shares of common stock to be issued upon exercise of outstanding options, warrants, and rights, the weighted-average exercise price of outstanding options, warrants, and rights, and the number of securities available for future issuance under equity compensation plans as of June 30, 2021.

[a] [b] [c]
Plan category       Number of
securities to
be issued
upon exercise
of outstanding
options, warrants,
and rights
(in thousands)
      Weighted-average
exercise price
per share of
outstanding
options, warrants,
and rights
      Number of
securities
remaining
for future
issuance under
non-qualified
stock-based
compensation
programs
(excluding securities
reflected in
column [a])
(in thousands)
Equity compensation plans approved by
security holders 
4,862 $ 139 7,888
Equity compensation plans not approved by
security holders
Total 4,862 $ 139 7,888

Column [a] includes the following outstanding equity-based awards (in thousands):

4,020 stock options
353 performance shares and deferred shares
174 deferred stock units for non-employee directors
315 restricted stock unit awards

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Audit Committee Matters

Proposal 3:
Ratification of Independent Registered Public Accounting Firm

The Audit Committee has the authority to appoint, retain, compensate, and oversee the Company’s independent registered public accounting firm, and the Company’s shareholders must ratify the Audit Committee’s selection and appointment. The Audit Committee has selected

Ernst & Young LLP (E&Y) as the Company’s independent registered public accounting firm for the fiscal year ending June 30, 2022. E&Y has been engaged since February 15, 2003.



Board’s Recommendation

The Board unanimously recommends that shareholders vote FOR the ratification of the selection of Ernst & Young LLP as the Company’s independent registered public accounting firm for the fiscal year ending June 30, 2022. While we are not required by law to obtain such ratification from our shareholders, the Board believes it is good practice to do so. The Audit Committee and the Board

believe that the continued retention of E&Y as the Company’s independent registered public accounting firm is in the best interests of the Company and its shareholders.

Representatives of E&Y are expected to be present at the Annual Meeting to respond to appropriate questions and to make a statement should they desire to do so.



Vote Required

The affirmative vote of a majority of the votes present in person or represented by proxy and entitled to vote on the matter is required to ratify the appointment of E&Y. If shareholders fail to ratify the appointment of E&Y, the Audit Committee will reconsider the appointment.

The people designated in the proxy and voting instruction card will vote your shares represented by proxy FOR ratification unless you include instructions to the contrary.


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Audit Committee Report

The Audit Committee assists the Board in its oversight of corporate governance by overseeing the quality and integrity of the accounting, auditing, and financial reporting practices of the Company, including:

review of reports filed by the Company on Form 10-Q and Form 10-K,
oversight of the financial reporting process,
assessment of the effectiveness of the Company’s internal control over financial reporting and the review of the performance of the internal audit function, and
oversight of the Company’s framework and guidelines with respect to risk assessment and risk management, including the Company’s cybersecurity and information technology risks and initiatives, and disclosure controls and procedures.

The Audit Committee operates in accordance with a written charter, which was adopted and is periodically updated by the Board. Each member of the Audit Committee is “independent,” as required by the applicable listing standards of the NYSE and the rules of the SEC.

While the Company’s management has primary responsibility for the financial statements, the reporting process and the Company’s internal control over financial reporting, the independent registered public accounting firm is responsible for performing an integrated audit of the Company’s financial statements and internal control over financial reporting in accordance with the auditing standards of the Public Company Accounting Oversight Board (the PCAOB). The Audit Committee members are not professional accountants or auditors, and their functions are not intended to duplicate or to certify the activities of management or the Company’s independent registered public accounting firm.

The Audit Committee is responsible for the appointment, retention, compensation, and oversight of the Company’s independent registered public accounting firm, including the review of their qualifications, independence and performance, and approval of the audit fee. In this regard, the Audit Committee appointed Ernst & Young LLP (E&Y) to audit the Company’s financial statements as of and for the year ended June 30, 2021, and the effectiveness of the Company’s internal control over financial reporting as of June 30, 2021. E&Y has served as the Company’s independent registered public accounting firm since February 2003. The Audit Committee considered several factors in selecting E&Y as the Company’s independent registered public accounting firm for the year ended June 30, 2021, including the firm’s independence and

internal quality controls, the overall depth of talent, their experience with the Company’s industry, and their familiarity with the Company’s businesses and internal control over financial reporting. In determining whether to reappoint E&Y as the Company’s independent registered public accounting firm for the year ending June 30, 2022, the Audit Committee again took those factors into consideration along with its evaluation of the past performance of E&Y and determined that the continued retention of E&Y as the Company’s independent registered public accounting firm is in the Company’s best interests.

The Audit Committee has a policy that requires it to consider and approve, in advance, any audit and permissible non-audit services to be performed by the independent registered public accounting firm. Among the assurance and related services provided by E&Y in fiscal year 2021, E&Y has issued reports on its review of certain corporate responsibility and sustainability metrics and information provided in the Company’s 2021 Integrated Annual Report – Executive Summary. The Audit Committee obtained from E&Y the written disclosures and the letter required by the applicable requirements of the PCAOB regarding https://www.thecloroxcompany.com/who-we-are/ corporate-governance/committee-charters communications with the Audit Committee concerning independence of the auditors and discussed with the auditors their independence. In evaluating E&Y’s independence, the Audit Committee considered whether the firm’s provision of any non-audit services impaired or compromised the firm’s independence and concluded that they did not.

Further, in conjunction with the mandated rotation of the auditing firm’s coordinating partner, the Audit Committee and its chairperson oversee and are directly involved in the selection of E&Y’s new coordinating partner. The Audit Committee periodically considers rotation of the registered independent public accounting firm.

In fulfilling its oversight responsibilities, the Audit Committee meets regularly with management and E&Y to discuss, prior to their release to the public, the Company’s financial statements and earnings releases and, as appropriate, other Company public communications containing Company financial information or performance measures. The Audit Committee’s meetings with the independent registered public accounting firm, which are both with and without management present, include discussions about the results of the independent registered public accounting firm’s examinations and evaluations of the quality of the Company’s financial statements and the Company’s internal control over financial reporting.


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Audit Committee Report

In this regard, the Audit Committee discussed with management the audited financial statements included in the Annual Report on Form 10-K for the fiscal year ended June 30, 2021. This review included a discussion of the quality and the acceptability of the Company’s financial reporting and system of internal controls, including the clarity of disclosures in the financial statements, reasonableness of significant contingency accruals, reserves, allowances and other judgments, critical accounting policies and estimates, and risk assessment. In addition, the Audit Committee reviewed and discussed with the Company’s independent registered public accounting firm the scope and plans for their audit, the audited financial statements of the Company for the fiscal year ended June 30, 2021, the independent registered public accounting firm’s judgments as to the quality and acceptability of the Company’s financial reporting, E&Y’s discussion about critical audit matters in its report on the audited financial statements for the fiscal year

ended June 30, 2021, the Company’s critical accounting policies and estimates, the effectiveness of the Company’s internal control over financial reporting and such other matters as are required to be discussed by the applicable requirements of the PCAOB and SEC.

In addition to the regular meetings with the independent registered public accounting firm and management noted above, the Audit Committee meets periodically with the internal audit team to discuss the scope, plans and results of their audits and holds private sessions with each of the Company’s chief legal officer, chief financial officer, and vice president of internal audit.

Based upon the review and discussions referred to above, the Audit Committee recommended to the Board that the Company’s audited financial statements be included in the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, 2021, for filing with the SEC.


THE AUDIT COMMITTEE as of June 30, 2021

Christopher J. Williams, Chair
Amy Banse
A.D. David Mackay
Paul Parker


Fees of the Independent Registered Public Accounting Firm

The table below includes fees related to fiscal years 2021 and 2020 of the Company’s independent registered public accounting firm, Ernst & Young LLP:

        2021       2020
Audit Fees(1) $ 5,751,000 $ 6,187,000
Audit-Related Fees(2) 149,000 114,000
Tax Fees(3) 182,000 63,000
All Other Fees(4) 3,000 145,000
Total $ 6,085,000 $ 6,509,000
(1) Consists of fees for professional services rendered for the audit of the Company’s annual financial statements and internal control over financial reporting, as required by Section 404 of the Sarbanes-Oxley Act of 2002, included in the Company’s Annual Reports on Form 10-K for each of the fiscal years ended June 30, 2021 and 2020, and for review of the financial statements included in the Company’s Quarterly Reports on Form 10-Q during those fiscal years.
(2) Consists of fees for assurance and related services (including the Company’s employee benefit plans) not included in the Audit Fees listed above.
(3) Consists of fees for tax compliance, tax advice and tax planning for the fiscal years ended June 30, 2021 and 2020. These services included advisory services on tax matters and review services for foreign subsidiaries and affiliates.
(4) Consists of fees for all other services not included in the three categories set forth above and are primarily related to permissible strategic advisory services and subscriptions to online content for fiscal years ended June 30, 2021 and 2020.

The Audit Committee has established a policy that requires it to approve all services provided by the Company’s independent registered public accounting firm before services are provided. The Audit Committee has pre-approved the engagement of the independent

registered public accounting firm for audit services, and certain specified audit-related services and tax services within defined limits. The Audit Committee has not pre-approved engagement of the independent registered public accounting firm for any other non-audit services.


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Additional Items to be Voted On

Proposal 4:
Approval of Amended and Restated 2005 Stock Incentive Plan

The Company’s 2005 Stock Incentive Plan, as amended and restated (the Plan), provides for the grant of incentive stock options (within the meaning of Section 422 of the IRC), non-qualified stock options, stock appreciation rights, restricted stock, restricted stock units, performance shares, performance units and other stock-based awards to employees, directors and consultants of the Company (collectively, the participants). The Plan, as amended and restated, was adopted by the Board on September 21, 2021 and will become effective on the date that it is approved by shareholders.

The primary amendments reflected in the amended and restated version of the Plan:

Extend the term of the Plan, which currently expires on November 14, 2022, by 10 years with a new expiration date of November 17, 2031
Lower the number of shares of the Company’s common stock that may be issued for new awards granted under the Plan after the effective date, which will be 5 million shares (less the aggregate number of shares granted between June 30 and November 17, 2021, including the 2021 annual awards)
Cap the compensation payable in cash and equity to a non-employee director at $750,000 per fiscal year (other than any director serving in the position of executive chair of the Board)
Require a one-year minimum vesting period on all awards granted under the Plan after the effective date, subject to certain limited exceptions

Provide that any dividends with respect to unvested equity awards may be accumulated but the actual payment will remain subject to the vesting of such awards
Provide upon a change in control for deemed achievement of performance-based awards at the greater of actual performance and target performance (with vesting still subject to continued service for awards assumed by a successor), and for extended exercisability of stock options and stock appreciation rights upon a severance event following a change in control
Add a cross-reference to the Company’s Policy Regarding Clawback of Incentive Compensation (the Recoupment Policy), adopted by the MDCC in February 2021

Additionally, amendments to Section 162(m) of the IRC (Section 162(m)), which removed the “qualified performance-based compensation” exemption from the $1 million per year compensation deduction limitation for certain executive officers, became effective in 2018. As a result, the amendment and restatement removes language that was intended to ensure performance-based awards qualified for this exemption, since it is no longer relevant. However, although no longer required by Section 162(m), the Company has not eliminated (or increased) the per-participant limits on awards in the Plan discussed below.

The closing price of a share of the Company’s common stock on October 1, 2021 was $164.52.


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Proposal 4: Approval of Amended and Restated 2005 Stock Incentive Plan


Summary of Key Equity Compensation Plan Data

Share Usage

The following table sets forth information regarding stock-settled, time-vested equity awards granted, performance-based equity awards earned/vested, and stock-settled deferred stock units granted under the Plan over each of the last three fiscal years.

     FY2021(1)       FY2020       FY2019      
Stock options/stock appreciation rights