8-KOther Events

WELLS FARGO & COMPANY/MN 8-K Report, Corporate Update (Jan 25, 2024)

Filed January 25, 2024For Securities:WFCWFC-PDWFC-PCWFC-PYWFC-PAWFC-PLWFCNPWFC-PZ

Summary

Wells Fargo & Company (WFC) announced that its Board of Directors has approved a total compensation of $29 million for CEO and President Charles W. Scharf for the performance year 2023. This compensation package is designed to align with the company's existing executive compensation program, which remained unchanged from 2022. The Board highlighted Mr. Scharf's leadership in improving financial performance, enhancing risk and control infrastructure, supporting the company during the 2023 regional banking crisis, investing in communities, and driving growth through strategic initiatives such as digital platform investments, new credit card offerings, and a private credit partnership. Notably, Mr. Scharf voluntarily requested the Human Resources Committee to exercise negative discretion, resulting in his total compensation being $1.3 million lower than the amount that would have been delivered based on performance metrics alone. This decision underscores Mr. Scharf's acknowledgment that further progress is needed to fully achieve the company's transformation goals. His total compensation for 2023 comprises a base salary of $2.5 million and variable compensation of $26.5 million, split between cash ($6.6 million) and long-term equity ($19.9 million). The Board expressed strong confidence in his leadership and commitment to shareholder value.

Key Highlights

  • 1CEO Charles W. Scharf's total compensation for 2023 was set at $29 million.
  • 2Mr. Scharf voluntarily requested negative discretion, reducing his compensation by $1.3 million from the calculated performance-based amount.
  • 3The compensation package remains consistent with the 2022 program design.
  • 4Key leadership contributions cited include improved financial performance, enhanced risk management, support during the banking crisis, and strategic business investments.
  • 5The 2023 compensation includes a $2.5 million base salary and $26.5 million in variable compensation ($6.6 million cash, $19.9 million equity).
  • 6Equity awards are comprised of 65% Performance Share awards (PSA) and 35% Restricted Share Rights (RSR) awards.
  • 7The Board expressed strong confidence in Mr. Scharf's leadership and commitment to shareholder value.

Frequently Asked Questions

Charles W. Scharf's total compensation for the 2023 performance year was $29 million. This includes a base salary of $2.5 million and $26.5 million in variable compensation, which is composed of cash and long-term equity awards.

Mr. Scharf voluntarily requested the Human Resources Committee to exercise negative discretion. This means he asked for his compensation to be lower than what the performance metrics would have otherwise dictated, acknowledging that more work remains to be done to achieve the company's transformation goals. The reduction amounted to $1.3 million.

The Board cited Mr. Scharf's strong leadership in improving the company's financial performance, driving efficiency, increasing capital returns to shareholders, strengthening risk and control infrastructure, providing stability during the 2023 regional banking crisis, investing in communities, and pursuing strategic growth initiatives across various business segments.

Mr. Scharf's $26.5 million in variable compensation for 2023 is split between $6.6 million in cash and $19.9 million in long-term equity. The equity awards consist of 65% Performance Share awards (PSA) and 35% Restricted Share Rights (RSR) awards.