Summary
Boston Scientific Corporation (BSX) filed an 8-K on November 22, 2021, to announce the approval of its 2022 Annual Bonus Plan and two new performance share programs for 2022. The 2022 Annual Bonus Plan is designed to incentivize eligible employees, including executive officers, based on corporate performance metrics such as adjusted earnings per share, global sales, human capital metrics, and quality assessment. The plan features a bonus pool with a maximum payout of 150% of the aggregate target, and includes provisions for allocation to different business units and individual performance evaluation, with oversight and discretion granted to the Board and CEO. Additionally, the company approved the 2022 Total Shareholder Return Performance Share Program (2022 TSR PSP) and the 2022 Free Cash Flow Performance Share Program (2022 FCF PSP). The TSR PSP aligns executive compensation with stockholder interests by comparing BSX's total shareholder return against the S&P 500 Healthcare Index over a three-year period. The FCF PSP incentivizes the achievement of free cash flow targets for the 2022 fiscal year. Both programs include provisions for recoupment in cases of executive misconduct or financial restatements, aligning with the company's commitment to ethical practices and financial integrity.
Key Highlights
- 1Boston Scientific has approved its 2022 Annual Bonus Plan, effective January 1, 2022, linking executive and employee bonuses to corporate performance metrics.
- 2Key performance indicators for the 2022 bonus plan include adjusted earnings per share, global sales (excluding FX and M&A impacts), human capital metrics, and quality assessment.
- 3The 2022 Annual Bonus Plan has a maximum payout ceiling of 150% of the aggregate target annual bonus.
- 4Two new performance share programs for 2022 have been established: the Total Shareholder Return (TSR) Performance Share Program and the Free Cash Flow (FCF) Performance Share Program.
- 5The 2022 TSR PSP measures executive performance against the S&P 500 Healthcare Index over a three-year period (2022-2024) and allows for awards ranging from 0% to 200% of target.
- 6The 2022 FCF PSP incentivizes the achievement of free cash flow targets for the 2022 fiscal year, with potential awards ranging from 0% to 150% of target.
- 7Both the bonus plan and performance share programs include recoupment provisions for executive misconduct, financial restatements, or other violations of company policy.