UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 14A

(Rule 14a-101)

SCHEDULE 14A INFORMATION

Proxy Statement Pursuant to Section 14(a) of the

Securities Exchange Act of 1934

(Amendment No.     )

Filed by the Registrant ☒                     Filed by a Party other than the Registrant ☐

Check the appropriate box:

 

☐		Preliminary Proxy Statement
☐		Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))
☒		Definitive Proxy Statement
☐		Definitive Additional Materials
☐		Soliciting Material Pursuant to §240.14a-12

Aptiv PLC

(Name of Registrant as Specified In Its Charter)

(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

Payment of Filing Fee (Check the appropriate box):

 

☒		No fee required.
☐		Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
		(1)		Title of each class of securities to which transaction applies:
		(2)		Aggregate number of securities to which transaction applies:
		(3)		Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is calculated and state how it was determined):
		(4)		Proposed maximum aggregate value of transaction:
		(5)		Total fee paid:
☐		Fee paid previously with preliminary materials.
☐		Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing.
		(1)		Amount Previously Paid:
		(2)		Form, Schedule or Registration Statement No.:
		(3)		Filing Party:
		(4)		Date Filed:

 

 

 

2021 NOTICE OF ANNUAL MEETING AND PROXY STATEMENT

 

 

 

 

To our Shareholders:

I am pleased to invite you to Aptiv PLC’s Annual General Meeting of Shareholders to be held on Friday, April 30, 2021, at 8:00 a.m. Eastern Time, virtually via the internet at www.virtualshareholdermeeting.com/APTV2021. I hope that the convenience of a virtual meeting will allow you to easily join and participate.

The following Notice of Annual General Meeting of Shareholders and Proxy Statement describes the business that will be conducted at the Annual Meeting. You can find financial and other information about Aptiv in the accompanying Form 10-K for the fiscal year ended December 31, 2020. These materials are also available on our website, aptiv.com.

Aptiv is a global technology company that develops safer, greener and more connected solutions enabling the future of mobility. We envision a future with zero vehicle-related injuries or fatalities, and have developed active safety technologies to meet customers’ needs and that have the potential to meaningfully save lives. We also see increasing development and adoption of vehicle electrification to enable a sustainable future for our planet, and have industry-leading high-voltage solutions that reduce CO2 emissions and enable our customers’ electrified vehicle designs. Our software enables seamless connectivity between vehicles, their passengers and the environments in which they operate. In short, Aptiv’s success emanates from a strong, sustainable business that makes the world a better place, a business that is Sustainable by Design.

Despite the unprecedented events of 2020, our commitment to our mission and values has allowed our employees to come together as One Team to keep each other safe while continuing to exceed our customers’ expectations. These efforts have created tremendous value for all of our stakeholders.

Your vote is very important to us. I encourage you to sign and return your proxy card or use telephone or Internet voting so that your shares will be represented and voted at the meeting.

Thank you for your continued support. We look forward to seeing you on April 30, 2021.

Sincerely,

 

 

 

Kevin P. Clark

President and Chief Executive Officer

2021 NOTICE OF ANNUAL MEETING AND PROXY STATEMENT

 

 

Notice of Annual General Meeting of Shareholders

 

Friday, April 30, 2021 8:00 a.m. Eastern Time		Place Meeting live via the Internet – please visit www.virtualshareholdermeeting.com/APTV2021		Record Date The close of business March 2, 2021

 

Meeting Agenda

Presenting the Company’s accounts and auditors’ reports for the fiscal year ended December 31, 2020 to the shareholders, passing the following resolutions, and transacting such other business as may properly come before the Annual Meeting:

 

•

Ordinary Resolutions

Election of Directors

 

THAT the following directors be elected as directors of the Company:

 

1)

Kevin P. Clark

2)

Richard L. Clemmer

3)

Nancy E. Cooper

4)

Nicholas M. Donofrio

5)

Rajiv L. Gupta

6)

Joseph L. Hooley

7)

Merit E. Janow

8)

Sean O. Mahoney

9)

Paul M. Meister

10)

Robert K. Ortberg

11)

Colin J. Parris

12)

Ana G. Pinczuk

Auditors

 

13)

THAT Ernst & Young LLP be re-appointed as the auditors of the Company until the Annual Meeting of the Company to be held in 2022, that the appointment of Ernst & Young LLP as the Company’s independent registered public accounting firm is ratified and that directors are authorized to determine the fees to be paid to the auditors.

 

•

Advisory, Non-Binding Resolution

Executive Compensation

 

14)

THAT the Company’s shareholders approve, on an advisory, non-binding basis, the Company’s executive compensation.

Resolutions 1 to 13 will be proposed as ordinary resolutions, and Resolution 14 will be proposed as an advisory, non-binding resolution.

 

•

Record Date

You are entitled to vote only if you were a shareholder of Aptiv PLC at the close of business on March 2, 2021. Holders of ordinary shares of Aptiv are entitled to one vote for each share held of record on the record date.

 

APTIV PLC    1

2021 NOTICE OF ANNUAL MEETING AND PROXY STATEMENT

 

Notice of Annual General Meeting of Shareholders (continued)

 

 

•

Attendance at the Virtual Annual Meeting

Due to the public health impact of the COVID-19 pandemic and out of an abundance of caution to support the health and well-being of our employees, shareholders and other stakeholders, the Board of Directors has determined to hold a virtual annual meeting in order to facilitate shareholder attendance and participation by enabling shareholders to participate from any location and at no cost. We are committed to ensuring that shareholders will be afforded the same rights and opportunities to participate as they would at an in-person meeting. You will be able to attend the meeting online, vote your shares electronically and submit questions during the meeting by visiting www.virtualshareholdermeeting.com/APTV2021.

To be admitted to the Annual Meeting at www.virtualshareholdermeeting.com/APTV2021 you must enter the 16-digit control number found on your proxy card, voting instruction form or notice you last received. You may vote and will be able to ask questions and hear responses to questions during the Annual Meeting by following the instructions available on the meeting website during the meeting. We hope you will be able to attend the Annual Meeting. If you expect to attend, please check the appropriate box on the proxy card when you return your proxy or follow the instructions on your proxy card to vote and confirm your attendance by telephone or Internet.

 

•

Where to Find More Information about the Resolutions and Proxies

Additional information regarding the business to be conducted and the resolutions is set out in the proxy statement (the “Proxy Statement”) and other proxy materials, which can be accessed by following the instructions on the Notice of Internet Availability of Proxy Materials that accompanies this Notice of Annual Meeting of Shareholders.

You are entitled to appoint one or more proxies to attend the Annual Meeting and vote on your behalf. Your proxy does not need to be a shareholder of the Company. Instructions on how to appoint a proxy are set out in the Proxy Statement and on the proxy card.

BY ORDER OF THE BOARD OF DIRECTORS

 

 

PLEASE NOTE THAT YOU WILL NEED PROOF THAT YOU OWN APTIV SHARES AS OF THE RECORD DATE TO BE ADMITTED TO THE ANNUAL MEETING.

This Notice of Annual Meeting of Shareholders and the Proxy Statement are being distributed or made available on or about March 15, 2021.

 

2    APTIV PLC

2021 NOTICE OF ANNUAL MEETING AND PROXY STATEMENT

 

 

Table of Contents

 

2021 PROXY STATEMENT — SUMMARY			6
2020 Aptiv at a Glance			7
OUR BOARD’S ENGAGEMENT			10
ELECTION OF DIRECTORS (RESOLUTIONS 1 TO 12)			11
BOARD PRACTICES			18
Size of the Board			18
Leadership Structure			18
Director Independence			18
Audit Committee Financial Experts			18
Evaluation of Board Performance			18
Director Qualifications, Nominations and Diversity			19
Diversity, Skills and Experience of Our Director Nominees			20
Director Retirement			21
Board Refreshment			21
Executive Sessions			21
Board’s Role in Risk Oversight			21
Board’s Role in Sustainability			22
Stock Ownership Guidelines			22
Governance Principles			22
Code of Ethical Business Conduct			22
Communications with the Board of Directors			22
BOARD AND COMMITTEE MEETINGS			23
BOARD COMMITTEES			23
DIRECTOR COMPENSATION			25
Board Compensation			25
2020 Director Compensation			25
COMPENSATION DISCUSSION AND ANALYSIS			26
A Note from the Chair of the Compensation Committee			26
Executive Summary			27
2020 Year in Review			29
Compensation Governance and Alignment with Shareholders			32
2020 Compensation Program Overview			33
Metric Definitions			38
2020 Annual Compensation Determination			38
2020 Long-Term Compensation			41
Adjustments and Payouts from Long-Term Compensation Granted in 2018			43
Supplemental Compensation Information and Reconciliation			44
Other Compensation			44
Compensation Governance Practices			45

 

APTIV PLC    3

2021 NOTICE OF ANNUAL MEETING AND PROXY STATEMENT

 

Table of Contents (continued)

 

 

COMPENSATION COMMITTEE REPORT			47
2020 SUMMARY COMPENSATION TABLE			48
2020 GRANTS OF PLAN-BASED AWARDS			50

 

2020 OUTSTANDING EQUITY AWARDS AT FISCAL YEAR-END			52
2020 OPTION EXERCISES AND STOCK VESTED TABLE			53
2020 PENSION BENEFITS			54
Eligibility			54
Valuation Method and Assumptions			54
2020 Pension Benefits			54
2020 NON-QUALIFIED DEFERRED COMPENSATION			55
Plan Benefits			55
Investment Options			55
Deferral Election Process			55
Distributions			55
Vesting			55
2020 Non-Qualified Deferred Compensation Table			55
POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE IN CONTROL			56
Employment Arrangements			56
Annual Incentive Plan			56
Long-Term Incentive Plan			56
Change in Control Plan			57
Severance Plan			57
Potential Payments upon Termination or Change in Control Table			58
CEO Pay Ratio			59
REPORT OF THE AUDIT COMMITTEE			60
INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM’S FEES			61
APPOINTMENT OF AND PAYMENT TO AUDITORS (RESOLUTION 13)			62
ADVISORY VOTE TO APPROVE EXECUTIVE COMPENSATION (RESOLUTION 14)			62
OWNERSHIP OF CERTAIN BENEFICIAL OWNERS			63
SECURITY OWNERSHIP OF MANAGEMENT			64
RELATIONSHIPS AND RELATED PARTY TRANSACTIONS			65

 

4    APTIV PLC

2021 NOTICE OF ANNUAL MEETING AND PROXY STATEMENT

 

Table of Contents (continued)

 

 

OTHER INFORMATION			66
Presentation of Accounts			66
Other Business			66
Shareholder Proposals for the 2022 Annual Meeting			66
Householding			66
Record Date			66
Voting prior to the Annual Meeting			66
Changing Your Vote before the Annual Meeting			66
Voting at the Annual Meeting			67
Quorum for the Annual Meeting			67
Voting Tabulation			67
Broker Non-Votes			67
Attending the Annual Meeting			67
Accessing Proxy Materials on the Internet			67
Notice and Access			67
Proxy Solicitation			67
Corporate Governance Information			68
Voting Results for the Annual Meeting			68
Requests for Copies of Annual Report			68
Important Notice Regarding the Availability of Proxy Materials for the Annual Meeting to be Held on April 30, 2021			68
APPENDIX A			A-1

 

APTIV PLC    5

2021 NOTICE OF ANNUAL MEETING AND PROXY STATEMENT

 

 

2021 Proxy Statement — Summary

 

This summary highlights information contained elsewhere in the Proxy Statement. This summary does not contain all of the information that you should consider, and you should read the entire Proxy Statement carefully before voting.

 

 

 

 ANNUAL MEETING OF SHAREHOLDERS

 

 Date: April 30, 2021

 Time: 8:00 a.m. Eastern Time

 Location: Meeting live via the Internet — please visit www.virtualshareholdermeeting.com/APTV2021

 Record Date: March 2, 2021

 

 

 

 GENERAL INFORMATION

 

 Stock Symbol: APTV

 Exchange: NYSE

 Ordinary Shares Outstanding (as of the record date): 270,462,749 shares

 Registrar & Transfer Agent: Computershare Investor Services

 Corporate Website: aptiv.com

 Investor Relations Website: ir.aptiv.com

 

 

 

 SHAREHOLDER VOTING MATTERS

 

 

Proposal		Board’s Voting           Recommendation
Election of Directors		FOR EACH NOMINEE
Ratification of Appointment of Independent Registered Public Accounting Firm		FOR
Advisory Vote to Approve Named Executive Officer Compensation		FOR

 

 

 

 

 BOARD MEETING INFORMATION

 

 Board Meetings in 2020: 11

 Standing Board Committee Meetings in 2020:

 Audit (5), Compensation and Human Resources (8), Finance (10), Innovation and Technology (5), Nominating and Governance (7)

 

 

 

 

 

 DIRECTOR NOMINEES

 

Name		Director     Since		Independent
Kevin P. Clark		2015
Richard L. Clemmer		2020		X
Nancy E. Cooper		2018		X
Nicholas M. Donofrio		2009		X
Rajiv L. Gupta		2009		X
Joseph L. Hooley		2020		X
Merit E. Janow		—		X
Sean O. Mahoney		2009		X
Paul M. Meister		2019		X
Robert K. Ortberg		2018		X
Colin J. Parris		2017		X
Ana G. Pinczuk		2016		X

 

 

 

 

NAMED EXECUTIVE OFFICERS

 

•

Kevin P. Clark - President and Chief Executive Officer

•

Joseph R. Massaro - Chief Financial Officer and Senior Vice President, Business Operations

•

David Paja - Senior Vice President and President, Advanced Safety and User Experience Segment

•

David M. Sherbin - Senior Vice President, General Counsel, Chief Compliance Officer and Secretary (retiring effective April 1, 2021)

•

Mariya K. Trickett - Senior Vice President and Chief Human Resources Officer

 

 

 

   COMPENSATION BEST PRACTICES

 

 

✓		Robust Stock Ownership Guidelines
✓		Clawback Policy
✓		Restrictive Covenants for Executives
✓		No Excise Tax Gross-Ups
✓		No Hedging/No Pledging

 

 

 

APTIV PLC		6

2021 NOTICE OF ANNUAL MEETING AND PROXY STATEMENT

 

 

2020 Aptiv at a Glance

 

Delivering sustainable mobility solutions

OUR MISSION Aptiv innovates at the intersection of disruptive trends in the mobility industry. As a global technology leader, our growing portfolio of solutions makes vehicles safer, greener and more connected, enabling the future of mobility and a more sustainable world.

SAFE A society with zero road fatalities, zero injuries and zero accidents

GREEN Zero emissions, minimizing vehicles’ total lifecycle environmental impact

CONNECTED Seamless integration between the vehicle, its passengers and the world around it

 

APTIV BY THE NUMBERS

$18B   2020 Business bookings

$13.1B   2020 Revenue

10%   2020 Growth over Market

$1.94   2020 Earnings per share   Adjusted for restructuring and other special items

$1.3B   2020 Investment in engineering

18,200   Scientists and engineers

180,000+   People

124   Manufacturing facilities

12   Major technical centers

44   Countries

 

 

		OUR BUSINESS SEGMENTS
		Uniquely positioned as the only provider of both the vehicle’s brain and nervous system We build the intelligence that brings to life the software-defined vehicle of the future and the technologies that connect every part of the vehicle, enable it to sense the world around it and allow it to communicate.
				Advanced Safety & User Experience				Signal & Power Solutions
		Encompasses our deep expertise in software-enabled solutions that improve the safety, comfort and convenience of the vehicle, supported by core capabilities in advanced computing, connectivity, data management and analytics.				Leverages our heritage as a global architecture provider and systems integrator to deliver the high-speed data and high-power electrical systems required for feature-rich, highly automated vehicles.
		The democratization of the technologies in these business segments has the potential to save lives, save the industry billions in costly vehicle repairs, and reduce carbon emissions.

 

7		APTIV PLC

2021 NOTICE OF ANNUAL MEETING AND PROXY STATEMENT

 

2020 Aptiv at a Glance (continued)

 

 

 

SAFE

GREEN

CONNECTED

SOCIETAL CHALLENGES

94% Of all accidents are caused by human error NHTSA   1.35 million Road traffic deaths annually World Health Organization   OUR SOLUTIONS

4.6 Metric tons of CO2 emitted from a typical passenger vehicle per year EFA   #1 Air pollution is the top environmental cause of death in the European Union European Environmental Agency

125 billion Connected loT devices worldwide by 2030 IHS Markit   50% Average annual increase of global data transmissions over the next 15 years IHS Markit

•  Perception systems, tracking and sensor fusion   •  Active safety, hands-free HMI and interior sensing software   •  ADAS domain controllers and ECUs   •  High-fidelity, high-reliability interconnects and signal distribution   •  Integration, validation and testing of safety-critical systems

•  High voltage wiring and electrical centers   •  High voltage connectors, plug-in chargers and cord sets   •  Aluminum wire harnesses for light-weighting   •  Sensing and compute platforms optimized for power management and consumption   •  Architecture optimization for mass and weight reduction

•  Secure connected gateways (cellular, satellite, DSRC, GPS)   •  Wireless (Wi-Fi, Bluetooth), media modules and consumer ports   •  V2X solutions: vehicle-to-vehicle / infrastructure / grid   •  Over-the-air (OTA) updates for software and firmware   •  Edge processing, cloud analytics and cybersecurity   •  Ruggedized electronic and automotive-grade connection systems

 

APTIV PLC		8

2021 NOTICE OF ANNUAL MEETING AND PROXY STATEMENT

 

2020 Aptiv at a Glance (continued)

 

 

 

Ethisphere Institute: 2021 World’s Most Ethical Companies® for the ninth year in a row.

Included in the FTSE4Good Index Series, demonstrating strong environmental, social and governance practices measured against globally recognized standards.

EcoVadis: 68/100, Gold rating. This result places Aptiv among the top 5% of companies assessed by EcoVadis.

Carbon Disclosure Project: Volunteer respondent to climate investor carbon and water reporting since 2012. CDP Climate Change Score: B.

Included in the Dow Jones Sustainability Indices (DJSI); DJSI tracks the stock performance of the world’s leading companies in terms of economic, environmental and social criteria.

Sustainalytics: Low Risk ESG Risk Rating. Ranked No. 5 in the Auto Parts industry category.

Ranked No. 4 in the Autos & Parts industry category and included in the JUST U.S. Large Cap Equity ETF.

In 2020, Aptiv received a rating of AA (on a scale of AAA-CCC) in the MSCI ESG Ratings assessment*.

Named to Fast Company’s prestigious annual list of the World’s Most Innovative Companies for 2020.

* The use by Aptiv of any MSCI ESG research LLC or its affiliates (“MSCI”) data, and the use of MSCI logos, trademarks, service marks or index names herein, do not constitute a sponsorship, endorsement, recommendation, or promotion of Aptiv by MSCI. MSCI services and data are the property of MSCI or its information providers, and are provided ‘as-is’ and without warranty. MSCI names and logos are trademarks or service marks of MSCI.

 

9		APTIV PLC

2021 NOTICE OF ANNUAL MEETING AND PROXY STATEMENT

 

 

Our Board’s Engagement

 

Throughout 2020, our Board of Directors and our Board committees maintained their regular schedule of meetings, quickly transitioning to virtual meetings as COVID-19 emerged. The Board’s work to provide oversight, review, and counsel related to strategy, risks, and opportunities, provided a strong foundation for management and the Board to build upon in responding quickly and appropriately to COVID-19. The risk landscape associated with the COVID-19 pandemic has been, and continues to be, discussed with the Board as well as each of the Board Committees, as appropriate. Over the course of 2020, management regularly updated our directors on COVID-19’s impacts to our business and the strategic, operational and financial risks associated with the pandemic. Discussions with the Board and the Board committees have included, among other topics, financial and operational matters, employee health and safety, plant and facility closures and implementation of Aptiv’s safe operations protocols to reopen sites, findings from outside medical experts and their evaluation of our protocols, and supply chain issues.

 

APTIV PLC		10

2021 NOTICE OF ANNUAL MEETING AND PROXY STATEMENT

 

 

 

Election of Directors

(Resolutions 1 to 12)

 

All of our current directors, other than Lawrence A. Zimmerman, who is retiring as of the Annual Meeting, are nominated for one-year terms to serve until the 2021 annual meeting, or until such director’s earlier resignation, retirement or other termination of service. The Board extends its appreciation to Mr. Zimmerman for his years of service, his many contributions and his thoughtful insight and advice.

The Board believes that the combination of the various qualifications, skills, and breadth and depth of experiences of the director nominees contributes to an effective and well-functioning Board. The Board and the Nominating and Governance Committee believe that, individually and as a whole, the directors possess the necessary qualifications to provide effective oversight of the business and quality advice and counsel to the Company’s management. Included in each director nominee’s biography below is an assessment of their specific qualifications, attributes, skills and experience. Committee memberships listed below are as of the date of this Proxy Statement.

The Board has been informed that each nominee is willing to continue to serve as a director. If a director does not receive a majority of the vote for his or her election, then that director will not be elected to the Board, and the Board may fill the vacancy with a different person, or the Board may reduce the number of directors to eliminate the vacancy. Messrs. Donofrio, Gupta, and Mahoney were each a member of the Board prior to the Company’s initial public offering in 2011, and information included in this Proxy Statement as to each member’s tenure on our Board reflects that service.

 

Kevin P. Clark       In March 2015, Mr. Clark became Aptiv’s President and Chief Executive Officer. In 2014, Mr. Clark was appointed Chief Operating Officer responsible for Aptiv’s business divisions, as well as the Global Supply Management function. Mr. Clark joined Aptiv in 2010 as Chief Financial Officer, responsible for all financial activities including strategic planning, corporate development, financial planning and analysis, treasury, accounting, and tax. Before coming to Aptiv, he was a founding partner of Liberty Lane Partners, LLC, a private equity investment firm focused on investing in and building and improving middle-market companies. Mr. Clark served as Chief Financial Officer of Fisher-Scientific International Inc., a manufacturer, distributor and service provider to the global healthcare market, from the company’s initial public offering in 2001 through the completion of its merger with Thermo Electron Corporation in 2006. He also held a number of senior management positions at Fisher-Scientific. Mr. Clark began his career in the financial organization of Chrysler Corporation. He has both a bachelor’s degree in financial administration and a master’s degree in finance from Michigan State University.		Non-Independent Director   Director since: March 2015   Committee Membership: None   Qualifications: Mr. Clark is a proven leader with demonstrated success in creating and implementing Aptiv’s business strategy. As our CEO and former COO and CFO, Mr. Clark provides the Board significant strategic, financial and industry expertise.   Other Public Boards: None Age: 58

 

11		APTIV PLC

2021 NOTICE OF ANNUAL MEETING AND PROXY STATEMENT

 

Election of Directors (continued)

 

 

Richard L. Clemmer       Mr. Clemmer is a global technology CEO, most recently leading the turnaround of NXP Semiconductors as Chief Executive Officer and President, a position he held from 2009 to May 2020. He continues to serve NXP as a Strategic Advisor. Prior to NXP, he was a senior advisor to Kohlberg Kravis Roberts & Co., a private equity firm, from 2007 to 2008. He also served as President and Chief Executive Officer of Agere Systems Inc. (“Agere Systems”), an integrated circuits components company from 2005 to 2007. Prior to joining Agere Systems, Mr. Clemmer held a number of executive leadership positions at Texas Instruments and Quantum Corporation. He holds a bachelor’s degree in business administration from Texas Tech University and a master of business administration from Southern Methodist University.		Independent Director   Director since: July 2020   Committee Membership: Finance Committee and Innovation and Technology Committee   Qualifications: Mr. Clemmer brings to the Board significant leadership experience in the high tech industry, including experience with semiconductor and software companies, and brings valuable experience leading organizations through strategic transactions.   Other Current Public Boards: HP Inc.   Former Public Boards: NCR Corporation (2008-2020), NXP Semiconductors N.V. (2009-2020) Age: 69
Nancy E. Cooper       Ms. Cooper is the former Executive Vice President and Chief Financial Officer of CA Technologies (“CA”), an IT management software provider, a position she held from August 2006 until she retired in May 2011. Prior to joining CA, Ms. Cooper served as the Chief Financial Officer of IMS Health, Inc. from 2001 to 2006 and, prior to that, as Chief Financial Officer for Reciprocal, Inc. from 2000 to 2001. Ms. Cooper began her career at IBM Corporation in 1976 where she held positions of increasing responsibilities over a 22-year period that focused on technology strategy and financial management. Ms. Cooper received a bachelor of arts degree in both economics and political science from Bucknell University and a master of business administration from the Harvard Graduate School of Business.		Independent Director   Director since: February 2018   Committee Membership: Audit Committee (Chair) and Innovation and Technology Committee   Qualifications: Ms. Cooper brings to the Board significant experience leading a global public finance organization, and contributes financial, risk management, technology and strategy expertise.   Other Current Public Boards: Brunswick Corporation and The Mosaic Company   Former Public Boards: Teradata Corporation (2009-2017) Age: 67

 

APTIV PLC		12

2021 NOTICE OF ANNUAL MEETING AND PROXY STATEMENT

 

Election of Directors (continued)

 

 

Nicholas M. Donofrio     Mr. Donofrio retired as Executive Vice President, Innovation & Technology at IBM in 2008. He began his career at IBM in 1964, and worked there for more than 40 years in various positions of increasing responsibility, including Division Director; President for Advanced Workstations Division; General Manager, Large Scale Computing Division; and Senior Vice President, Technology & Manufacturing. Mr. Donofrio earned a bachelor of science degree from Rensselaer Polytechnic Institute and holds a master’s degree from Syracuse University.		Independent Director   Director since: December 2009   Committee Membership: Innovation and Technology Committee (Chair) and Nominating and Governance Committee   Qualifications: Mr. Donofrio brings to the Board significant technology expertise, providing us with valuable insight regarding technology and innovation strategies.   Former Public Boards: Advanced Micro Devices, Inc. (2009-2018) and Bank of New York Mellon Corporation (1999-2017) Age: 75
Rajiv L. Gupta     Mr. Gupta is former Chairman and CEO of Rohm and Haas Company, a worldwide producer of specialty materials, a position he held from 1999 to 2009. Mr. Gupta began his career at Rohm and Haas in 1971 and served in a broad range of global operations and financial leadership roles. Mr. Gupta received a bachelor of science degree in Mechanical Engineering from the Indian Institute of Technology, a master of science degree in Operations Research from Cornell University and a master’s degree in business administration with a concentration in Finance from Drexel University.		Independent Director and Chairman of the Board   Director since: November 2009   Committee Membership: Compensation and Human Resources Committee (Chair) and Nominating and Governance Committee (Chair)   Qualifications: Mr. Gupta’s professional experience, including as Chairman and CEO of a global public company and many other board assignments, enable him to contribute his expertise in corporate leadership, public company governance, strategic analysis, operations and executive compensation matters.   Other Current Public Boards: Avantor, Inc., DuPont de Nemours, Inc.   Former Public Boards: Howmet Aerospace Inc. (formerly Arconic Inc.) (2016-2020), HP Inc. (formerly Hewlett Packard) (2009-2017), The Vanguard Group, Inc. (2001-2017) and Tyco International plc (2005-2016) Age: 75

 

13		APTIV PLC

2021 NOTICE OF ANNUAL MEETING AND PROXY STATEMENT

 

Election of Directors (continued)

 

 

Joseph L. Hooley     Mr. Hooley is the former Chairman of the Board and Chief Executive Officer of State Street Corporation, one of the world’s leading providers of financial services to institutional investors. He retired as the non-executive Chairman of the Board of State Street, effective December 31, 2019, and as its Chief Executive Officer on December 31, 2018. He served as State Street’s Chairman from 2011 to 2019 and as Chief Executive Officer from 2010 to 2018 and President and Chief Operating Officer from 2008 to 2014. From 2002 to 2008, Mr. Hooley served as Executive Vice President and head of the Investor Services Division of State Street and, in 2006, was appointed Vice Chairman and Global Head of Investment Servicing and Investment Research and Trading of State Street. Mr. Hooley holds a bachelor of science degree from Boston College.		Independent Director   Director since: January 2020   Committee Membership: Audit Committee and Compensation and Human Resources Committee   Qualifications: Mr. Hooley’s long tenure as a public company executive leading a global financial services organization provides the Board significant expertise in management, strategic planning, corporate governance and a global business perspective.   Other Current Public Boards: Exxon Mobil Corporation   Former Public Boards: State Street Corporation (2009-2019) Age: 63
Merit E. Janow       Professor Janow is the Dean, School of International and Public Affairs (SIPA) at Columbia University, a position she has held since 2013. She also serves, since 1994, as a Professor of Professional Practice, International Economic Law and International Affairs at Columbia University. Previously, she directed the program in international finance and economic policy. Professor Janow regularly teaches advanced courses in frontier topics in international trade law and policy, World Trade Organization (WTO) law, at Columbia Law School, and international economic policy and China in the Global Economy at SIPA. She has published numerous articles and several books on international trade and economic matters. Professor Janow served as one of seven members of the WTO’s Appellate Body from 2003 to 2007, as the Executive Director, the International Competition Policy Advisory Committee of the U.S. Department of Justice, Antitrust Division from 1997 to 2000, and Deputy Assistant U.S. Trade Representative for Japan and China from 1990 to 1993. Professor Janow served on the board of directors and then as chair of the Nasdaq Stock Markets LLC of the Nasdaq OMX Group from 2005 to 2016. She holds a bachelor of arts degree from the University of Michigan and a juris doctorate from Columbia Law School at Columbia University.		Director Nominee   Qualifications: Professor Janow is qualified to serve as director of the Company based on her extensive knowledge and experience in international trade, economics, policy and regulatory matters which provide valuable insight to the Company given the global nature of its business.   Other Current Public Boards: Mastercard Inc., Trimble Inc. Age: 62

 

APTIV PLC		14

2021 NOTICE OF ANNUAL MEETING AND PROXY STATEMENT

 

Election of Directors (continued)

 

 

Sean O. Mahoney     Mr. Mahoney is a private investor with over two decades of experience in investment banking and finance. Mr. Mahoney spent 17 years in investment banking at Goldman, Sachs & Co., where he was a partner and head of the Financial Sponsors Group, followed by four years at Deutsche Bank Securities, where he served as Vice Chairman, Global Banking. During his banking career, Mr. Mahoney acted as an advisor to companies across a broad range of industries and product areas. He earned his undergraduate degree from the University of Chicago and his graduate degree from Oxford University, where he was a Rhodes Scholar.		Independent Director   Director since: November 2009   Committee Membership: Finance Committee and Nominating and Governance Committee   Qualifications: Through his experience in investment banking and finance, Mr. Mahoney provides the Board with expertise in financial and business strategy, capital markets, financing, and mergers and acquisitions.   Other Current Public Boards: iHeartMedia, Inc.   Former Public Boards: Alcoa Inc. (2016), Cooper-Standard Holdings, Inc. (2015-2018) and Howmet Aerospace Inc. (formerly Arconic Inc.) (2016-2020) Age: 58
Paul M. Meister     Mr. Meister is co-founder, and since 2008, Chief Executive Officer of Liberty Lane Partners, LLC, a private investment company with investment holdings in healthcare, technology and distribution-related industries. He was President of MacAndrews & Forbes Incorporated (“M&F”) from 2014 to 2018, a private company that owns or controls a diverse set of businesses, including: Revlon, Scientific Games, Harlan Clarke Holdings Corp., vTv Therapeutics LLC, SIGA Technologies, and AM General. During 2018, Mr. Meister also served, on an interim basis, as Executive Vice Chairman of Revlon, Inc. a leading beauty products company, and acted as Revlon’s principal executive officer. Mr. Meister served from 2010 to 2014 as Chairman and CEO of inVentiv Health (now Syneos Health), a leading provider of commercial, consulting and clinical research services to the pharmaceutical and biotech industries. Mr. Meister was Chairman of Thermo Fisher Scientific, Inc., a scientific instruments equipment and supplies company, from November 2006 to April 2007. He was previously Vice Chairman of Fisher Scientific International, Inc., a predecessor of Thermo Fisher Scientific, Inc., from 2001 to 2006, and Chief Financial Officer of Fisher Scientific International, Inc. from 1991 to 2001. Earlier in his career, Mr. Meister served in a number of executive leadership positions at Wheelabrator Technologies Inc., The Henley Group Inc., and AlliedSignal Inc. (now Honeywell International, Inc.). He began his career with Ford Motor Company. Mr. Meister holds a bachelor of arts degree from the University of Michigan and a master of business administration from Northwestern University.		Independent Director   Director since: July 2019   Committee Membership: Compensation and Human Resources Committee and Finance Committee   Qualifications: Mr. Meister’s extensive public company experience, as both an executive and a board member, provides the Board significant expertise in management, strategy, finance and capital markets, operations and mergers and acquisitions.   Other Current Public Boards: Amneal Pharmaceuticals, Inc., Oaktree Acquisition Corp. II, Quanterix Corporation   Other Public Boards: LKQ Corporation (1999-2018), Revlon, Inc. (2016-2018), Scientific Games Corporation (2012-2020) and vTv Therapeutics Inc. (2015-2018) Age: 68

 

15		APTIV PLC

2021 NOTICE OF ANNUAL MEETING AND PROXY STATEMENT

 

Election of Directors (continued)

 

 

Robert K. Ortberg     Mr. Ortberg is the former Chief Executive Officer of Collins Aerospace, a United Technologies company from December 2018 to February 2020. Following his retirement from Collins Aerospace, he served as a Special Advisor to the office of the Chief Executive Officer for Raytheon Technologies Corporation, an aerospace and defense company that provides advanced systems and services for commercial, military and government customers worldwide until March 2021. He previously served as the Chief Executive Officer of Rockwell Collins from 2013 to 2018 and served as President from 2012 to 2018. He served as Rockwell Collins’ Executive Vice President, Chief Operating Officer, Government Systems from 2010 to 2012 and as Executive Vice President, Chief Operating Officer, Commercial Systems from 2006 to 2010. Prior to that time, he held other executive positions at Rockwell Collins, which he joined in 1987. Mr. Ortberg has a bachelor of science degree in mechanical engineering from the University of Iowa.		Independent Director   Director since: September 2018   Committee Membership: Audit Committee and Innovation and Technology Committee   Qualifications: Mr. Ortberg brings to the Board a track record of operational and technology leadership, accelerating company growth and creating shareholder value, coupled with a strong background in transformation and innovation.   Other Current Public Boards: Raytheon Technologies Corporation   Former Public Boards: Rockwell Collins, Inc. (2013-2018) Age: 60
Colin J. Parris     Dr. Parris currently serves as the Senior Vice President and Chief Technology Officer at GE Digital. He joined the General Electric Company in 2014 as the Vice President, GE Software Research. Prior to joining GE, he spent two decades at IBM in a variety of executive roles, serving most recently as Vice President, Systems Research in the IBM T.J. Watson Research Division from 2013 to 2014 and General Manager for IBM’s Power Systems business from 2010 to 2013. Dr. Parris received a bachelor’s degree in electrical engineering from Howard University, a master’s degree in management from Stanford University, and master’s degrees in electrical engineering and computer science, and a doctorate in electrical engineering from the University of California, Berkeley.		Independent Director   Director since: December 2017   Committee Membership: Audit Committee and Innovation and Technology Committee   Qualifications: Dr. Parris has an extensive technology background with significant experience in software and leading digital transformations. His current focus on data software and artificial intelligence provides valuable knowledge to the Board.   Other Public Boards: None Age: 59

 

APTIV PLC		16

2021 NOTICE OF ANNUAL MEETING AND PROXY STATEMENT

 

Election of Directors (continued)

 

 

Ana G. Pinczuk     Ms. Pinczuk is the Chief Development Officer for Anaplan, Inc., which provides a cloud-based connected planning platform that helps connect organizations and people to make better and faster decisions. She joined Anaplan in February 2019 as the Chief Transformation Officer, following positions as the President of Hewlett Packard Enterprise’s Pointnext technology services organization, the Executive Vice President and Chief Product Officer of Veritas Technologies LLC, a data management provider specializing in information protection, availability, and insight solutions, and Senior Vice President and General Manager, Backup and Recovery for Symantec Corporation, all in the period from 2015 to 2018. From 2000 until 2015, Ms. Pinczuk served in various executive positions with Cisco Systems, Inc., including serving as Senior Vice President, Sales from 2014 to 2015, Senior Vice President, Services Transformation and Chief Operating Officer from 2013 to 2014, and Vice President, Global Technical Services from 2009 until 2013. Prior to joining Cisco, Ms. Pinczuk spent 15 years with AT&T, Inc., in positions of increasing responsibility. Ms. Pinczuk earned both undergraduate and graduate mechanical engineering degrees from Cornell University, an executive master’s degree in technology management from the University of Pennsylvania and a master’s degree in software management from Carnegie Mellon University.		Independent Director   Director since: November 2016   Committee Membership: Audit Committee and Innovation and Technology Committee   Qualifications: Ms. Pinczuk’s broad technology background spans mobile, IP networking, software, data storage and security, making her a strong contributor to the Board as Aptiv accelerates its innovation in new mobility technologies.   Former Public Boards: KLA–Tencor Corporation (2018-2019) Age: 57

The Board of Directors recommends a vote “FOR” each of the 12 director nominees named above. If you complete the enclosed proxy card, unless you direct otherwise on that card, the shares represented by that proxy will be voted FOR the election of all 12 nominees.

 

17		APTIV PLC

2021 NOTICE OF ANNUAL MEETING AND PROXY STATEMENT

 

 

BOARD PRACTICES

 

Board and Governance Information

 

Size of Board		12
Number of Independent Directors		11
Mandatory Retirement Age		75
Non-Executive Chairman		✓
Annual Election of Directors		✓
Executive Sessions of Independent Directors at each Board Meeting		✓
Annual Board and Committee Evaluations		✓
Independent Audit, Compensation and Human Resources and Nominating and Governance Committees		✓
Director Stock Ownership Guidelines		✓
Code of Ethical Business Conduct Applies to all Directors and Employees		✓

 

 

APTIV PLC		18

2021 NOTICE OF ANNUAL MEETING AND PROXY STATEMENT

 

Board Practices (continued)

 

 

 

19		APTIV PLC

2021 NOTICE OF ANNUAL MEETING AND PROXY STATEMENT

 

Board Practices (continued)

 

 

Diversity, Skills and Experience of Our Director Nominees

The table below summarizes some of the experience, qualifications, attributes and skills of our director nominees. This high-level summary is not intended to be an exhaustive list of each of our director nominee’s skills or contributions to the Board; we look to directors to be knowledgeable in these areas as it relates to Aptiv. We have identified below the areas where each director has specific expertise or prominence that he or she brings to the Board. Further information on each director nominee, including some of their specific experience, qualifications, attributes or skills is set forth in the biographies in “Election of Directors” above.

 

 

 

 

 

APTIV PLC		20

2021 NOTICE OF ANNUAL MEETING AND PROXY STATEMENT

 

Board Practices (continued)

 

 

 

21		APTIV PLC

2021 NOTICE OF ANNUAL MEETING AND PROXY STATEMENT

 

Board Practices (continued)

 

 

 

APTIV PLC		22

2021 NOTICE OF ANNUAL MEETING AND PROXY STATEMENT

 

 

BOARD AND COMMITTEE MEETINGS

 

During 2020, the Board held 11 in-person or virtual meetings. All of our directors attended at least 75% of the Board and Committee meetings on which they serve. In addition, all directors are expected to attend the Annual Meeting of Shareholders, and in 2020, all directors virtually attended the Annual Meeting.

In addition to the formal meetings held, which increased in number due to COVID-19, the Board and its Committees were regularly virtually briefed by management on the Company’s response to COVID-19.

BOARD COMMITTEES

Our Board has the following five committees: Audit; Compensation and Human Resources (CHRC); Finance; Innovation and Technology (ITC); and Nominating and Governance (Nom Gov). Committee charters are available on our website at aptiv.com by clicking on the tab “Investors”, then the heading “Governance” and then the caption “Governance Documents”. Committee membership for 2020 is set forth below:

 

Board Committees

Name

Audit

CHRC

Finance

ITC

Nom Gov

Kevin P. Clark

Richard L. Clemmer

X

X

Nancy E. Cooper

C

X

Nicholas M. Donofrio

C

X

Rajiv L. Gupta

C

C

Joseph L. Hooley

X

X

Sean O. Mahoney

X

X

Paul M. Meister

X

X

Robert K. Ortberg

X

X

Colin J. Parris

X

X

Ana G. Pinczuk

X

X

Lawrence A. Zimmerman

X

C

 

“C” = Chair of Committee

“X” = Member of Committee

During 2020, Mr. Clemmer was appointed to the Finance Committee and the Innovation and Technology Committee, Mr. Hooley was appointed to the Audit Committee and the Compensation and Human Resources Committee, and Mr. Ortberg joined the Audit Committee and stepped down from the Compensation and Human Resources Committee. In 2021, in anticipation of Mr. Zimmerman’s retirement, Mr. Meister was appointed Chair of the Finance Committee.

 

23		APTIV PLC

2021 NOTICE OF ANNUAL MEETING AND PROXY STATEMENT

 

Board Committees (continued)

 

 

Committee		Primary Responsibilities		Number of Meetings in 2020
Audit
		Responsible for the engagement of the registered independent public accounting firm and the review of the scope of the audit to be undertaken by the registered independent public accounting firm. Responsible for oversight of the adequacy of our internal accounting and financial controls and the accounting principles and auditing practices and procedures to be employed in preparation and review of our financial statements. Responsible for oversight of risk-related matters broadly, including the Company’s enterprise risk management program, compliance program and cybersecurity.		5
Compensation and Human Resources
		Responsible for the oversight of the Company’s compensation philosophy and reviews and approves compensation for executive officers (including cash compensation, equity incentives and benefits). Responsible for oversight of management development and succession planning.		7
Finance
		Responsible for oversight of corporate finance matters, including capital structure, financing transactions, acquisitions and divestitures, minority investments, share repurchase and dividend programs, employee retirement plans, interest rate policies, commodity and currency hedging and the annual business plan, including review of capital expenditures and restructurings.		10
Innovation and Technology
		Responsible for oversight of the Company’s technology roadmaps and the technology landscape, product cybersecurity and assessing the overall skill set of the engineering organization.		5
Nominating and Governance
		Responsible for reviewing and recommending policies and procedures relating to director and board committee nominations and corporate governance policies, conducting director searches and overseeing aspects of the Company’s environmental, social and governance programs, including providing input to management on the Company’s risks, policies, strategies and programs generally related to matters of sustainability, corporate social responsibility, corporate governance and environment, health and safety management programs.		7

 

APTIV PLC		24

2021 NOTICE OF ANNUAL MEETING AND PROXY STATEMENT

 

 

DIRECTOR COMPENSATION

 

Board Compensation

Our directors (other than Mr. Clark, who does not receive additional compensation for services as a member of the Board) received the following annual compensation for service in 2020, which is paid in cash and time-based restricted stock units (“RSUs”). Each director may elect, on an annual basis, to receive 60%, 80% or 100% of his or her compensation in RSUs, with the remainder paid in cash. In April 2020, as a commitment to the Company’s efforts to conserve cash in the wake of the COVID-19 crisis, each director elected to receive the balance of their 2020 compensation in the form of RSUs. The Chairman of the Board receives $500,000 annually, and all other directors receive $265,000 annually. In 2020, Chairs of our Board committees received the following additional annual compensation:

 

Committee		Additional Annual Compensation
Audit			$	25,000
Compensation and Human Resources				20,000
Finance				15,000
Innovation and Technology				15,000
Nominating and Governance(1)				15,000

 

(1)

The Chairman of the Nominating and Governance Committee is also the Chairman of the Board; he does not receive an additional fee for his service as the Nominating and Governance Committee Chairman. He does, however, receive payment for his services as Chairman of the Compensation and Human Resources Committee.

An annual grant of RSUs is made on the day of the Annual Meeting, which vests on the day before the next annual meeting. Cash compensation is paid quarterly at the end of each fiscal quarter. Any director who joins the Board, other than in connection with the Annual Meeting, will receive prorated cash compensation and a prorated grant of RSUs, based on the date the director joins the Board. These RSUs vest on the day before the next annual meeting.

The table below shows cash and equity compensation paid to each member of the Board in 2020:

2020 Director Compensation

 

Name		Fees Earned or Paid in Cash($)(2)					Stock Awards($)(3)					Total($)
Richard L. Clemmer			$	—				$	220,905				$	220,905
Nancy E. Cooper				29,000					290,046					319,046
Frank J. Dellaquila(1)				13,250					—					13,250
Nicholas M. Donofrio				28,000					280,026					308,026
Rajiv L. Gupta				26,000					520,031					546,031
Joseph L. Hooley				26,500					265,026					291,526
Sean O. Mahoney				26,500					265,026					291,526
Paul M. Meister				—					265,026					265,026
Robert K. Ortberg				26,500					265,026					291,526
Colin J. Parris				26,500					265,026					291,526
Ana G. Pinczuk				26,500					265,026					291,526
Lawrence A. Zimmerman				28,000					280,026					308,026

 

(1)	Mr. Dellaquila did not receive a stock award in 2020, as he retired from the Board in April 2020.

(2)	Amounts reflected in this column were related to 2019 compensation elections paid in 2020.

(3)

Reflects the grant date fair value of the equity awards granted to directors on April 23, 2020, which was the date of grant for all directors, other than Mr. Clemmer. The grant date for Mr. Clemmer was July 1, 2020, in connection with his appointment to the Board. The values set forth in the table were determined in accordance with FASB ASC Topic 718. For assumptions used in determining the fair value of the awards, see Note 21. Share-Based Compensation to the Consolidated Financial Statements in our Annual Report on Form 10-K for the fiscal year ended December 31, 2020. As of December 31, 2020, all outstanding Aptiv RSU awards held by our directors were unvested; they vest in full on April 29, 2021. The year-end RSU balances for our directors are:

 

Name		Unvested RSUs 12/31/2020
Richard L. Clemmer				2,929
Nancy E. Cooper				4,776
Nicholas M. Donofrio				4,611
Rajiv L. Gupta				8,563
Joseph L. Hooley				4,364
Sean O. Mahoney				4,364
Paul M. Meister				4,364
Robert K. Ortberg				4,364
Colin J. Parris				4,364
Ana G. Pinczuk				4,364
Lawrence A. Zimmerman				4,611

 

 

25		APTIV PLC

2021 NOTICE OF ANNUAL MEETING AND PROXY STATEMENT

 

 

COMPENSATION DISCUSSION AND ANALYSIS

 

A Note from the Chair of the Compensation Committee

Dear Shareholders,

Balancing pay-for-performance with shareholder alignment is a hallmark of our executive compensation program at Aptiv. Our leadership team relentlessly focuses on the key short and long-term metrics that are critical to executing our business strategy, delivering sustainable growth, and driving shareholder value. Ever since our first say-on-pay vote in 2012, our shareholders have overwhelmingly supported our executive compensation programs. We appreciate your support and are committed to achieving the continued alignment of executive pay with shareholder interests.

Our compensation programs continue to be primarily performance-based, with a significant portion of executive pay at-risk. We consistently set performance targets that are rigorous and reflective of the business plan we communicate to investors.

As we reflect on 2020, the year proved to be much more challenging than anticipated, and certainly less predictable than any planning scenario could have foreseen. Aptiv was faced with a multitude of challenges, both operational and financial, throughout the year as the COVID-19 pandemic emerged and evolved during 2020. Our management team demonstrated exceptional performance throughout this unprecedented year by taking early and decisive actions to put the safety and welfare of our employees first, while preserving and enhancing the Company’s financial flexibility. These early actions positioned us to safely restart our global operations, ensuring flawless operational execution with zero customer disruptions, and enabling Aptiv to achieve strong financial results during the second-half of the year.

The Company’s ability to persevere during this unprecedented time and capitalize on the opportunities that emerged following the onset of the COVID-19 pandemic have driven our share price to all-time highs in the fourth quarter. Our 3-year total shareholder return (“TSR”), a metric on which we evaluate shareholder return, was at the 89th percentile of our TSR peer group.

However, the COVID-19 pandemic dramatically affected Aptiv’s financial performance throughout the year, including with respect to the financial metrics underlying our performance-based compensation programs. In light of this unprecedented year and the extraordinary performance by the management team, the Compensation Committee thoughtfully reviewed and assessed performance against the original performance objectives. Additionally, as part of our ongoing investor engagement, we solicited input from top shareholders to ensure our approach to adjustments, as detailed throughout this Proxy Statement, was consistent with our historic pay-for-performance track record and is aligned with shareholder interests. As a result, the Committee exercised its discretion and made certain adjustments in order to achieve the desired goals of our compensation plans to appropriately compensate management for their actual achievement on behalf of all stakeholders during the year.

As we position Aptiv for continued success, we strive to ensure our compensation programs strengthen and reinforce our strategy, attract and retain top talent, and continue to drive long-term shareholder value.

Thank you again for your continued support and investment in Aptiv.

 

 

Raj Gupta

Chair of the Compensation Committee

 

APTIV PLC		26

2021 NOTICE OF ANNUAL MEETING AND PROXY STATEMENT

 

Compensation Discussion and Analysis (continued)

 

 

Executive Summary

 

●  Our executive pay program aligns with long-term shareholder value creation. A significant portion of executive pay is performance-based, and subject to rigorous performance targets that are important to our shareholders.   ●  Initial decisions on our 2020 compensation plan were made prior to the COVID-19 pandemic. The compensation plan design and targets were established in January 2020, prior to the global emergence of the COVID-19 pandemic and the production shutdowns that ensued. The 2020 compensation plan design included certain changes in order to better align our compensation programs with shareholder interests, including increasing the weighting of relative TSR in our 2020-2022 long-term incentive program from 25% to 33%. In our annual incentive plan metrics, we replaced New Business Bookings with revenue Growth Over Market (“GOM”), a measure of relative revenue growth versus underlying global vehicle production. These changes strengthened alignment of our compensation programs to our strategic objectives, competitive market practices, and shareholder interests.   ●   All of our NEOs voluntarily reduced their base salary for the period from April 2020 through August 2020 in response to the financial pressures brought about by the COVID-19 pandemic. All NEOs also deferred their approved base salary increases until September 1, 2020.   ●   COVID-19 had a significant impact on achievement against both our short- and long-term original financial objectives. The impact of COVID-19, including global shutdowns, periods of reduced automotive demand, and the increased costs of keeping our employees safe rendered the previously established financial targets for our annual incentive plan and performance-based restricted stock units (“RSUs”) unachievable. In light of the Company’s strong operating and financial performance, including in response to COVID-19 and the unprecedented challenges it presented, and the extraordinary efforts of our employees and leaders around the world to enable the success of the Company following the onset of the COVID-19 pandemic, the Compensation Committee determined this outcome did not reflect our pay-for-performance philosophy.   ●  The Compensation Committee recognized the need to re-align the compensation programs in light of COVID-19. In response to management’s decisive actions to successfully respond to and generate strong results in light of the COVID-19 pandemic, the Compensation Committee evaluated changes to compensation programs. The key principles underlying the Compensation Committee’s consideration of compensation program changes were to:       Consider the welfare of our employees first      Preserve value for our shareholders     Compensate and reward performance and value creation     Reduce pay opportunity in conjunction with adjusted goals     Cap long-term payouts at target if we do not outperform our peers   ●  In July 2020, the Compensation Committee prudently reset the goals and reduced payout opportunities in the Annual Incentive Plan. As the industry emerged from global shutdowns and the Company successfully restarted operations, the Compensation Committee approved the Updated Incentive Plan (as defined below) to motivate participating employees, including executives, and to encourage sustained focus on enterprise-wide goals. The Updated Incentive Plan provided reduced target and maximum incentive opportunities at 50% and 65% of original target payout, respectively.				3-YEAR TSR   49.6% 89TH PERCENTILE OF OUR TSR PEER GROUP     BELOW TARGET INCENTIVE PAYOUT   65% ANNUAL INCENTIVE   95% 2018-2020 LONG-TERM INCENTIVE     CEO BASE SALARY REDUCTION   50% BASE SALARY REDUCTION FROM APRIL-AUGUST 2020     3 YEAR AVERAGE SAY-ON-PAY 96%

 

27		APTIV PLC

2021 NOTICE OF ANNUAL MEETING AND PROXY STATEMENT

 

Compensation Discussion and Analysis (continued)

 

 

●

In December 2020, the Compensation Committee took thoughtful action to adjust long-term compensation programs in response to COVID-19. Due to the emergence of the COVID-19 pandemic and resultant impacts on the Company’s industry and operations in 2020, the Compensation Committee determined that it was reasonable and appropriate to truncate the performance period for the 2018-2020 performance cycle to measure achievement of the financial results based on actual and estimated financial performance as of December 31, 2019. In addition, adjustments were made to restore our 2019 and 2020 compensation programs’ intended effectiveness. Ensuring alignment of pay-for-performance with shareholder value creation remains a key focus and ensures that the management team is accountable for strategic and operational execution. The Compensation Committee made the following changes:

 

•

Adjusted the original 3-year financial performance objectives for the 2019 and 2020 performance-based RSU grants, while maintaining the overall plan design. The revised targets were established at levels that the Compensation Committee deemed rigorous and challenging, while acknowledging the current operating environment;

 

•

Reduced the maximum payouts for 2019 and 2020 performance-based RSU grants from 200% to 150%; with payouts capped at 100% if relative TSR is below median; and

 

•

Did not grant any new incremental awards.

 

●

Our 3-year TSR was 49.6% – at the 89th percentile of our TSR peer group, reflecting operational performance well above industry peers. Despite COVID-19 disruptions, our Company delivered strong shareholder returns in 2020, driven by its operating and financial performance to which our management team contributed significantly.

 

●

Even following these adjustments, our executives were awarded below-target short- and long-term payouts. Although the Company and its leadership exceeded expectations in navigating the unprecedented environment throughout 2020, the Compensation Committee acknowledged that the original targets were not achieved. Following the compensation program adjustments described above, our CEO earned 65% of his annual incentive target for 2020, and 95% of his target shares for the 2018-2020 long-term incentive award. In determining these levels, the Committee applied negative discretion to further align compensation earned by our executives with the austerity measures taken in 2020, including cost reduction and cash conservation actions, while recognizing the overall impact on our employees.

 

Plan		Before Adjustments		After Adjustments		After Application of Negative Discretion
Annual Incentive Plan		10% payout (GOM)		65% payout		65% payout
2018-2020 performance-based RSUs		49% payout		106% payout		95% payout

 

●

Accounting guidelines distort the compensation reported in our 2020 Summary Compensation Table. The approved adjustments to 2019-2021 and 2020-2022 long-term incentive grants, while maintaining the value and intent of the original grants, require disclosure in the “Stock Awards” column of the “2020 Summary Compensation Table” as additional stock awards granted in 2020 due to the accounting impact of the program adjustments. For example, the amount disclosed in the “Stock Awards” column for our CEO of approximately $28.5 million reflects his original 2020 performance-based RSU grant as well as including the accounting impact of the adjustments approved in December 2020 to the 2019 and 2020 grants. What would typically be disclosed for this amount is approximately $10.7 million, which reflects the grant date fair value of the 2020 annual grant at the time it was made. Refer to the “Supplemental Compensation Information and Reconciliation” section below, which is provided in order to illustrate the implicit value of awards for our CEO after these adjustments.

 

APTIV PLC		28

2021 NOTICE OF ANNUAL MEETING AND PROXY STATEMENT

 

Compensation Discussion and Analysis (continued)

 

 

2020 Year in Review

2020 Company Financial and Business Performance Highlights. COVID-19 affected nearly every facet of our operations. In spite of these impacts, our 2020 performance reflects our team’s dedication and efforts to ensure the health and safety of our employees first, while positioning the Company for flawless execution for our customers as operations resumed. Management’s actions preserved and enhanced Aptiv’s financial strength during the COVID-19 pandemic and generated strong returns following the restart of our global operations.

Our financial and business achievements in 2020 include the following:

 

•

Strengthening our balance sheet and liquidity position in order to continue to invest in value-enhancing opportunities, despite COVID-19

 

•

Leveraging opportunistic market pricing dynamics and strong market demand by issuing $1.15 billion of ordinary shares and $1.15 billion of 5.50% preferred shares; and

 

•

Extending the maturity of substantially all of our existing revolving credit facility to August 2022.

 

•

Acting decisively in response to the global COVID-19 pandemic

 

•

Taking early and decisive actions to preserve our financial strength, including temporarily reducing executive pay, reducing capital expenditures, and suspending share repurchases and ordinary share dividends; and

 

•

Designing and successfully implementing our safe operations protocols, which enabled our facilities to restart safely and operate with zero production disruptions following the restart.

 

•

Generating strong results despite the COVID-19 pandemic

 

•

Delivering sustained outperformance, with 10% sales growth over market, attributable to our portfolio of leading technologies aligned with secular growth drivers;

 

•

Generating $1.621 billion of Adjusted EBITDA and cash flow before financing of $836 million, despite the COVID-19 pandemic’s negative impact on automotive production; and

 

•

Achieving 49.6% TSR over the period 2018 through 2020, illustrating our investors’ belief in our long-term strategy and current financial performance.

 

•

Continuing our relentless focus on cost structure and operational optimization

 

•

Maximizing our operational flexibility and profitability at all points in the normal automotive business cycle, by having approximately 97% of our hourly workforce based in best cost countries, and approximately 20% of our hourly workforce composed of contract and temporary employees; and

 

•

Recruiting and retaining top talent from various industries, including technology.

 

•

Continuing to execute on our long-term Safe, Green and Connected strategy to enable a more sustainable future

 

•

Furthering our leadership position in automated driving through the formation of the Motional autonomous driving joint venture with Hyundai, which is focused on the design, development and commercialization of autonomous driving technologies;

 

•

Expanding our market relevant portfolio to address the industry’s top challenges, including high voltage electrification and active safety technologies; and

 

•

Significantly enhancing our commitment to corporate sustainability.

Appendix A contains a reconciliation of non-GAAP financial measures used in this disclosure to U.S. GAAP financial measures.

2020 Shareholder Engagement. Aptiv is committed to proactive engagement, communication, and transparency with shareholders. During 2020, we engaged institutional shareholders with respect to a variety of topics related to employee and board culture, board recruitment and refreshment, safety performance and sustainability efforts, and executive compensation. Raj Gupta, the Chairman of the Board and Chairman of the Compensation Committee, as well as members of management,

 

29		APTIV PLC

2021 NOTICE OF ANNUAL MEETING AND PROXY STATEMENT

 

Compensation Discussion and Analysis (continued)

 

 

participated, as appropriate. In these meetings, we solicited feedback and provided information to our shareholders. We also specifically solicited insight regarding shareholder sentiment about potential adjustments to executive compensation programs.

In addition, members of management met with our investors throughout the year to discuss our businesses, technologies, end markets, financial results, operational execution and our sustainability efforts at numerous conferences and roadshows, in addition to Company-hosted events and quarterly conference calls. We also shared financial and ESG information relevant to our shareholders through our Sustainability Report, our Investor Relations website, our Annual Report and this Proxy Statement.

2020 Say-on-Pay. At our 2020 Annual Meeting of Shareholders, we received support from approximately 96% of votes cast as to our named executive officers’ compensation. Management and the Compensation Committee reviewed our shareholders’ 2020 Say-on-Pay vote and believe it to be a strong indication of continuing support for the Company’s executive compensation program and pay-for-performance philosophy. Therefore, the Compensation Committee maintained its overall pay-for-performance philosophy, compensation objectives and governing principles it has used in recent years when making decisions or adopting policies regarding executive compensation for 2020 and subsequent years. However, given the significant disruptions caused by COVID-19 after the establishment of 2020 executive compensation goals, the Compensation Committee and management believed it was important to solicit additional shareholder insight related to executive compensation practices related to COVID-19, as described above.

COVID-19 Impacts on Shareholders, Employees, and Executives. Our Board and management team took immediate and decisive actions in response to COVID-19 to protect the interests of many stakeholder groups, including employees, shareholders, customers, suppliers, and our communities.

For those actions that related to or impacted compensation, our Compensation Committee’s philosophy was simple:

 

•

Ensure our shareholders’ value is preserved and our non-executive employees’ compensation is addressed first, with our executives’ compensation adjusted afterward;

 

•

Reasonably adjust executive compensation for the impacts of COVID-19 on our outstanding compensation programs in order to preserve our pay-for-performance philosophy, and design these adjustments to be more resilient to potential future COVID-19 impacts;

 

•

Reduce pay opportunities in light of the updated metrics and targets following the impacts of COVID-19; and

 

•

Transparently report the compensation program adjustments.

 

APTIV PLC		30

2021 NOTICE OF ANNUAL MEETING AND PROXY STATEMENT

 

Compensation Discussion and Analysis (continued)

 

 

We believe we have been successful in following those principles. The table below sets forth the short-term impacts of the COVID-19 pandemic on our shareholders, our employees and our executives, and the status of these effects at the end of 2020.

 

				SHORT-TERM IMPACTS				END-OF-YEAR IMPACTS
INCREASING   SHAREHOLDER   VALUE				Temporary stock price decline				Stock price reached all-time highs in Q4 2020
				Stock price on March 18th closed at $33.55, down 64% from the December 31, 2019 close				At December 31, 2020, stock closed at $130.29, resulting in a 2018-2020 TSR of 49.6%
				Dividend suspended in March 2020				On a relative basis, our TSR performed at the 89th percentile within our TSR peer group
CARING FOR   OUR   EMPLOYEES				Temporary lay-offs for workers in production facilities aligned with customer and government-mandated shutdowns				Approved a program to provide financial recognition to approximately 15,000 employees (excluding NEOs and other officers)
				Furloughs for salaried non-plant roles				Implemented previously-approved salary increases for salaried employees, effective September 1, 2020
				Suspension of annual salary increases				Reinstated Aptiv’s retirement plan contributions for US, Ireland, and Mexico employees, effective January 1, 2021
				Suspension of retirement plan contributions in the US, Ireland and Mexico				Shared Aptiv’s safety protocols with governments for adoption
				Implemented SAFE start protocols and contact tracing systems to keep our employees safe				Provided PPE to our communities

		Following mitigation of impacts of COVID-19 on shareholders and employees, the Compensation Committee adjusted incentive programs to restore their motivational impact and preserve our pay-for-performance philosophy

RETAINING AND   MOTIVATING OUR   EXECUTIVES				Voluntary base salary reduction of 50% by the CEO and 10% by our senior officers				Adjusted incentive awards to restore intended motivational and retentive value and preserve our pay-for-performance philosophy
				Short- and long-term performance compensation programs decreased significantly in retentive and motivational value across all three outstanding long-term performance cycles				Reduced upside potential in the 2020 short-term incentive award cycle and in the 2019 and 2020 long-term incentive award cycles
								Capped payouts at target if relative TSR is below median for the 2019 and 2020 long-term incentive cycles

 

31		APTIV PLC

2021 NOTICE OF ANNUAL MEETING AND PROXY STATEMENT

 

Compensation Discussion and Analysis (continued)

 

 

Compensation Governance and Alignment with Shareholders

Aptiv’s executive compensation program is designed to attract, retain and motivate the leaders who drive the successful execution of our business strategies, which seek to balance achievement of targeted near-term results with building long-term shareholder value through sustained execution. Our focus on pay-for-performance and corporate governance aims to help ensure alignment with the interests of our shareholders, as highlighted below:

 

		Pay for Performance		More information   on page
		90% of 2020 total target annual compensation for the CEO is at risk and 75% is granted in equity, while, on average, 81% of 2020 target annual compensation for the other NEOs is at risk and 63% is granted in equity.		33
		We target executive compensation to approximate a competitive range around the market median (50th percentile) and deliver compensation above or below this level as determined by performance.		34
		We use a structured goal-setting process for performance incentives, with multiple levels of review.		39
		NEOs’ annual incentives in typical years are based on achievement of Corporate, Segment and individual performance goals.		39
		75% of the NEOs’ long-term incentive compensation consists of performance-based RSUs, which deliver value based on achievement of financial and relative TSR goals. The value of the remaining 25% of the NEOs’ long-term incentive compensation is awarded in the form of time-based RSUs and fluctuates with Aptiv’s share price.		41
		We review and analyze our pay-for-performance alignment on an annual basis.		—

 

		Compensation Governance		More information     on page
		We actively engage with our shareholders by conducting regular meetings with our major shareholders to discuss governance and executive compensation matters.		29
		We disclose our performance metrics.		37
		We maintain a reasonable severance practice with market appropriate post-employment provisions.		44
		We maintain stock ownership guidelines for our NEOs and directors.		45
		We maintain clawback, anti-hedging and anti-pledging policies.		45
		We offer no excise tax gross-ups or tax assistance unique to our NEOs.		46
		Our Compensation Committee utilizes an independent compensation consultant.		46
		Our compensation programs are designed to discourage imprudent risk.		46
		We devote focused time to leadership development and succession planning efforts.		—
		Our equity grant practices, including burn rate and dilution, are prudent.		—
		The Compensation Committee is provided tally sheets to assess total compensation for our NEOs.		—

 

APTIV PLC		32

2021 NOTICE OF ANNUAL MEETING AND PROXY STATEMENT

 

Compensation Discussion and Analysis (continued)

 

 

2020 Compensation Program Overview

Our Named Executive Officers

 

For fiscal year 2020, the NEOs were:
Kevin P. Clark		President and Chief Executive Officer (“CEO”)
Joseph R. Massaro		Chief Financial Officer (“CFO”) and Senior Vice President, Business Operations
David Paja		Senior Vice President and President, Advanced Safety and User Experience Segment
David M. Sherbin		Senior Vice President, General Counsel, Chief Compliance Officer and Secretary (Mr. Sherbin is retiring from Aptiv effective April 1, 2021.)
Mariya K. Trickett		Senior Vice President and Chief Human Resources Officer

 

 

 

 

33		APTIV PLC

2021 NOTICE OF ANNUAL MEETING AND PROXY STATEMENT

 

Compensation Discussion and Analysis (continued)

 

 

2020 Target Compensation Structure. The following table depicts the initial 2020 target annual direct compensation opportunities for the NEOs. The amounts reflected in this table were determined by the Compensation Committee in January 2020, prior to the global spread of the COVID-19 pandemic and subsequent production shutdowns in China, North America and Europe during the first half of 2020. This table does not reflect the base salary reductions, deferrals of base salary increases, and reductions of target annual incentive plan awards that subsequently occurred during 2020 in light of COVID-19 and the resultant impacts on the Company. It also does not reflect the grant date fair value of the annual 2020 long-term incentive awards granted in February 2020, or the incremental accounting impact associated with adjustments made to the outstanding performance-based equity awards during 2020, each of which are discussed in further detail below in the “Supplemental Compensation Information and Reconciliation” section. Further, this table does not include information regarding changes in pension value and non-qualified deferred compensation earnings, or information regarding all other compensation, each of which are presented in the “2020 Summary Compensation Table.” As such, this table should not be viewed as a substitute for the “2020 Summary Compensation Table.”

 

Name		Base Salary ($)(1)				Annual Incentive Target Award ($)				Long-Term Incentive Plan Target Annual Award ($)				Total ($)
Kevin P. Clark		$	1,462,272				$2,193,408			$	11,000,000			$	14,655,680
President and Chief Executive Officer
Joseph R. Massaro			935,000				935,000				3,700,000				5,570,000
Chief Financial Officer and Senior Vice President, Business   Operations
David Paja(2)			649,666				552,216				2,200,000				3,401,882
Senior Vice President and President, Advanced Safety and   User Experience Segment
David M. Sherbin			621,500				559,350				1,550,000				2,730,850
Senior Vice President, General Counsel, Chief Compliance   Officer and Secretary
Mariya K. Trickett			550,000				467,500				1,500,000				2,517,500
Senior Vice President and Chief Human Resources Officer

 

(1)	Reflects base salary rates as of September 1, 2020, which were originally to be effective April 1, 2020. As described below, base salaries for the NEOs were reduced from April 2020 through August 2020 prior to the implementation of these base salary rates.

(2)

Mr. Paja is a German employee and his salary and bonus are paid in Euros. U.S. Dollar amounts in this Proxy Statement with respect to Mr. Paja have been converted from Euros at a rate of 1.14 Dollars to one Euro. The exchange rate used was calculated by averaging exchange rates for each calendar month in 2020.

 

 

APTIV PLC		34