Morgan Stanley · NYSE:MS
Morgan Stanley — Shareholder Meeting (April 2018)
17 slides from Morgan Stanley's shareholder meeting presentation, Apr 6, 2018
Slide 1: Morgan Stanley Compensation & Governance Practices
Morgan Stanley Compensation & Governance Practices April 2018
Slide 2: Board of Directors Recommends Shareholders Vote
MORGAN STANLEY’S BOARD OF DIRECTORS RECOMMENDS SHAREHOLDERS VOTE: • FOR: Three Management Proposals 1 Approve the compensation of named executive officers (Say on Pay non-binding advisory vote) – At the start of 2017, as in prior years, the Compensation, Management Development and Succession (CMDS)
Slide 3: Compensation Objectives
COMPENSATION OBJECTIVES Morgan Stanley has a robust pay for performance philosophy and practice, and is committed to responsible and effective compensation programs with the following key objectives, which support shareholders’ interests: • Emphasize variable annual incentives and performance-vested
Slide 4: Framework for Determining CEO Compensation
FRAMEWORK FOR DETERMINING CEO COMPENSATION 1 2 3 4 Establish Target Assess Determine Set Performance Priorities Compensation Performance Compensation Range In the context of the The Compensation, The CMDS Committee The CMDS Committee Firm’s strategic Management assesses Firm and determines CEO objec
Slide 5: Strategic Objectives and Target Compensation Range
STRATEGIC OBJECTIVES AND TARGET COMPENSATION RANGE Management establishes long-term strategic objectives approved by the Board. The CMDS Committee establishes a target CEO total compensation range annually to serve as a guideline when assessing performance and determining compensation at year end 1
Slide 6: Execution of Two-Year Strategic Plan: Mark to Market
3 EXECUTION OF TWO-YEAR STRATEGIC PLAN: MARK TO MARKET 2016 – 2017 Strategic Objectives 2017 Results(1) 1 Streamline: $1Bn Expense Reduction, <74% Firm Expense Efficiency Ratio 73% Firm Expense Efficiency Ratio 2 Complete Fixed Income Restructuring and Maintain Full Year Revenues $4.9Bn with Revenue
Slide 7: Execution of Two-Year Strategic Plan: Increased Profitability
EXECUTION OF TWO-YEAR STRATEGIC PLAN: INCREASED 3 PROFITABILITY To provide transparency and a better understanding of operating performance, certain of the Firm’s 2017 reported results are adjusted below for items under the Tax Act and other intermittent tax items Improving Profitability... Net Inco
Slide 8: Execution of Two-Year Strategic Plan: Delivered Value to Shareholders
EXECUTION OF TWO-YEAR STRATEGIC PLAN: DELIVERED VALUE 3 TO SHAREHOLDERS Morgan Stanley and S&P 500 Financials Index Total Shareholder Returns (TSR)(1)(2) 1-Year (2017) TSR 3-Year (2015-2017) TSR 5-Year (2013-2017) TSR 205% 46% 43% 134% 26% 22% Morgan S&P 500 Morgan S&P 500 Morgan S&P 500 Stanley Fin
Slide 9: CEO Compensation Determination
4 CEO COMPENSATION DETERMINATION At year end, the CMDS Committee assessed CEO and Firm performance, discussed that assessment with the Board, and established 2017 CEO compensation MS 2017 CEO Compensation MS 2017 CEO Compensation Elements ($MM) % of Incentive $27 MM Compensation % of Total $28 Milli
Slide 10: Compensation Program Aligned with Best Practices in Governance, Risk Management
COMPENSATION PROGRAM IS WELL ALIGNED WITH BEST PRACTICES IN GOVERNANCE, RISK MANAGEMENT, AND REGULATORY PRINCIPLES Key Features of Compensation Program Deferred incentive • 74% of CEO compensation is deferred over three years compensation • Clawbacks apply to all awards and cover material adverse ou
Slide 11: Board of Directors Has Relevant and Diverse Experience
MORGAN STANLEY’S BOARD OF DIRECTORS HAS RELEVANT AND DIVERSE EXPERIENCE The Board continues to recruit directors to bring new skills and perspectives into the Morgan Stanley Boardroom (Year) = Year Director joined Board 䡵 = New Director in 2016-2018 Board Members Select Experience(1) Board Members S
Slide 12: Committed to Best in Class Governance Practices – Governance Highlights
MORGAN STANLEY IS COMMITTED TO MAINTAINING BEST IN CLASS GOVERNANCE PRACTICES – GOVERNANCE HIGHLIGHTS • Ten new directors since 2012 who bring a diversity of skills, attributes and perspectives to the Board Board Structure • Average Board tenure is approximately five years and Independence • Expansi
Slide 13: Vote Against Proposal to Adopt a Policy on Deferred Equity Awards
MORGAN STANLEY’S BOARD OF DIRECTORS RECOMMENDS SHAREHOLDERS VOTE AGAINST PROPOSAL TO ADOPT A POLICY TO PROHIBIT VESTING OF DEFERRED EQUITY AWARDS FOR SENIOR OFFICERS WHO RESIGN TO ENTER GOVERNMENT SERVICE Reasons to Vote “Against” • Vesting and payout of deferred compensation when an employee leaves
Slide 14: End Notes
END NOTES The following notes are an integral part of the Firm’s financial and operating performance described in this presentation: General • A detailed analysis of the Firm’s financial and operational performance for 2017 is contained in the Management’s Discussion and Analysis of Financial Condit
Slide 15: End Notes (cont.)
END NOTES (CONT.) Page 5 1. Compensation range informed by prior year CEO pay levels at 16 Peer Financial Companies, including (i) five large U.S. banks: Bank of America, Citigroup, Goldman Sachs, JPMorgan Chase, and Wells Fargo; and (ii) other financial companies in S&P 100 index: AIG, Allstate, Am
Slide 16: End Notes (cont.)
END NOTES (CONT.) Page 12 As part of his or her formal duties and responsibilities, the Independent Lead Director shall: – Preside at all meetings of the Board at which the Chairman is not present; – Have the authority to call, and lead, non-management director sessions and independent director sess
Slide 17: Notice
NOTICE The information provided herein may include certain non-GAAP financial measures. The definition of such financial measures and/or the reconciliation of such measures to the comparable GAAP figures are included in the Firm’s Annual Report on Form 10-K for the year ended December 31, 2017, whic