SEC Form DEF 14A filed by RenaissanceRe Holdings Ltd.

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In 2023, we celebrated RenaissanceRe’s 30th anniversary by delivering one of our strongest years, financially and strategically. Management achieved two challenging objectives – leading a step change in property catastrophe reinsurance pricing and accelerating growth in a favorable market through the acquisition of Validus. Throughout this exceptional year, the Board maintained its robust oversight, provided strategic stewardship and ensured aligned executive compensation.

We begin 2024 with a larger and more efficient underwriting portfolio, a motivated and deeply talented workforce and longstanding customer relationships and partnerships. In short, we are positioned to deliver enduring shareholder value.

Across key measures, 2023 financial performance was excellent. RenaissanceRe reported $2.5 billion of net income available to common shareholders, $1.8 billion of operating income available to common shareholders, return on average common equity of 40.5%, operating return on average common equity of 29.3%, growth in book value per share plus change in accumulated dividends of 59.3% and growth in tangible book value per common share plus change in accumulated dividends of 47.6%.¹ These strong results were driven by meaningful contributions from all Three Drivers of Profit:

The acquisition of Validus accelerated our strategy as a leading global reinsurer, bringing attractive property, casualty and specialty books that were immediately accretive to our financial returns. With Validus, we bolstered the future of our company through the addition of what we believe was one of the best reinsurance assets, and at the January 1, 2024 renewal we were successful in retaining our combined portfolio, providing diversified growth into an attractive market.

In addition to a substantial amount of attractive premium, the Validus acquisition brought us significant new talent. The Validus team has become a valuable part of RenaissanceRe, and we have been impressed by their dedication and knowledge. The industry-leading risk expertise and scale we now bring to the market is differentiating and allows us to solve even bigger risk challenges for our customers.

Our financial and strategic accomplishments were only possible because of the integrated contributions from the RenaissanceRe team. Our culture, and our success, centers on collaboration, empowerment and a strong connection to our purpose - to protect communities and enable prosperity. As a result, in our most recent employee survey we were very pleased to see 87% of our employees reported feeling favorably about their level of engagement with RenaissanceRe.

RenaissanceRe’s management team and employees have worked tirelessly to build the premier reinsurance platform to serve customers and reward our shareholders. We have retained highly successful, skilled talent in our industry, and we believe that at-risk, long-term and performance-based pay is fundamental to incentivizing our management team’s execution of our long-term strategy. Given our strong financial and strategic execution in 2023, and consistent with our pay-for-performance philosophy, our named executive officers received an above target annual incentive bonus this year, and our performance shares paid out above target for the 2021 to 2023 performance period.

In November, the Corporate Governance and Human Capital Management Committee (the “Governance and Human Capital Committee”) determined to grant performance recognition awards to those management members that played an instrumental role in the Validus transaction which will incentivize continued value-creation for shareholders over the long-term. The Governance and Human Capital Committee has also written a letter addressed to our shareholders in which they discuss their thoughtful considerations around granting this award and our approach to compensation governance, found on page 43 of this proxy statement.

We have been intentional in building not only an exceptional leadership team to lead our Company, but also a highly skilled, diverse and independent Board to oversee our strategy and long-term shareholder value creation. The diverse skills, viewpoints, experience, knowledge and abilities of our directors have been invaluable as RenaissanceRe has diversified and expanded globally. During the acquisition of Validus, these skills were instrumental as the Board provided advice and strategic oversight that was complementary to management throughout the transaction. The Board culture is one that encourages substantive, open dialogue among directors and management, and the Board remains focused on providing independent oversight as management continues to execute on our next phase of growth.

Since our inception, we have remained dedicated to managing and mitigating the impact of climate change on society, recognizing that climate change has a direct impact on the risk that we manage and our business success. This year, we highlighted ongoing progress executing our sustainability strategy through our inaugural Sustainability Report.

Through our own proprietary research, and our active role in industry partnerships such as ClimateWise, the Insurance Development Forum, and the Sustainable Markets Initiative, we leverage our collective expertise in risk understanding and capital management to drive the industry toward a resilient and sustainable future. A key part of this work relates to closing the insurance protection gap, where we focus on industry opportunities to improve catastrophe modelling and risk understanding in disadvantaged areas and thus make insurance more accessible.

This year we proudly commemorated RenaissanceRe’s 30th anniversary and celebrated the people and milestones that have contributed to the Company’s success. Over RenaissanceRe’s history, our actions have been guided by our founding vision to be the best underwriter and our mission to match desirable risk with efficient capital. This has driven us to evolve and build the scale and capabilities necessary to broadly serve the needs of our customers.

RenaissanceRe would not be the global, diversified company it is today without the hard work and talent of all our employees, leadership from management, guidance from the Board, and the long-standing support of our customers, partners and investors.

Thank you for your support and investment in RenaissanceRe for over 30 years! 2023 was an excellent year. We are immensely proud of the way the entire RenaissanceRe team came together to deliver value for you, our shareholders, and we will continue to work hard on your behalf.

March 26, 2024

Sincerely,

The board of directors (the “Board”) of RenaissanceRe Holdings Ltd. (“RenaissanceRe,” the “Company,” “we,” “us,” or “our”) is making this proxy statement and proxy available to you in connection with the solicitation of proxies for our 2024 Annual General Meeting of Shareholders (the “Annual Meeting”).

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

RenaissanceRe is a global provider of reinsurance and insurance that specializes in matching desirable risk with efficient capital. We provide property, casualty and specialty reinsurance and certain insurance solutions to customers, principally through intermediaries. Established in 1993, we have offices in Bermuda, Australia, Canada, Ireland, Singapore, Switzerland, the U.K. and the U.S. We are one of the world’s leading providers of property, casualty and specialty reinsurance solutions.

As we celebrated our 30^th anniversary in 2023, we delivered strong strategic, operational and financial returns, and we believe that we have positioned ourselves to create enduring shareholder value moving forward. Our financial performance was outstanding, with exceptional performance across many metrics, and we achieved several strategic milestones, including the completion of the Validus acquisition on November 1, 2023, which was immediately accretive to our shareholders. We believe that the Validus acquisition advances our strategy as a global property and casualty reinsurer, providing additional scale and deeper partnerships with customers and brokers. Through the Validus acquisition, we gained access to a large, attractive book of reinsurance business that was closely aligned with our existing business mix, accelerating our growth in a favorable market.

Some of our strategic, operational and financial highlights for 2023 included:

 

 

Our 2023 results demonstrate our strong performance over a long period, through challenging market conditions. Since Mr. O’Donnell was named our Chief Executive Officer in 2013, we have performed well on key financial metrics. He has led the Company to become a diversified reinsurer with an innovative and flexible operating platform. From 2013 to 2023, our total shareholder return grew at a compound annual growth rate (“CAGR”) of 10.4%, and our book value per common share plus accumulated dividends reached $192 in 2023.

 

 

 

Our Board is comprised almost entirely of independent directors with a wide range of professional experience and has consistently implemented corporate governance best practices to ensure that we serve the long-term interests of our shareholders.

Our executive compensation program is designed to support our long-term strategy and risk management practices, align the interests of our shareholders and executives, and encourage operational and financial consistency over the market cycles and earnings volatility that are inherent and unique to our industry.

A significant portion of our annual target executive compensation is at-risk long-term and/or performance-based, with a mix of quantitative and qualitative metrics that we believe aligns the interests of our executives with our shareholders and rewards our Chief Executive Officer (or “CEO”) and other continuing named executive officers (or “NEOs”) for delivering strong performance on our strategic plan without incentivizing excessive risk taking. In November 2023, we granted performance recognition awards to our continuing named executive officers in connection with our acquisition of Validus, and in furtherance of our strategic goals. Those awards are described in more detail in “2023 Performance Recognition Awards” below and are not reflected in the target pay mix as they do not reflect an ongoing element of compensation.

The annual target pay mix for our Chief Executive Officer and each of our other continuing named executive officers for 2023 was:

 

 

Following the successful acquisition of Validus in November 2023, the Governance and Human Capital Committee granted performance recognition awards to Mr. O’Donnell and the other continuing named executive officers.

 

The Governance and Human Capital Committee evaluates and sets performance goals designed to be rigorous, with the goals set at the time of grant for all performance-based compensation. The link between pay and performance and the outcomes of our executive compensation program for 2023 are discussed in detail in the “Compensation Discussion and Analysis” section. The graphic below provides supplemental disclosure and should not be viewed as a substitute for the disclosure included in “Pay Versus Performance.”

 

We recognize the value of engaging in a dialogue with our shareholders to solicit their views and input. Our ongoing engagement includes interactions led by our investor relations team with many of our largest shareholders, and regular participation by members of our executive leadership in investor conferences. Members of senior management also engage with investors in meetings that are primarily focused on corporate governance, executive compensation, and sustainability topics, some of which are led by an independent director. Our Board appreciates the insights gained in these discussions and receives a summary of shareholder engagement at each quarterly Board meeting. The Governance and Human Capital Committee is also provided with a detailed summary of direct shareholder communications at each quarterly committee meeting.

 

In early 2024, we conducted targeted governance-focused outreach to shareholders representing 53% of shares outstanding and engaged with all shareholders who accepted the outreach request, encompassing 39% of shares outstanding. Of these meetings, the Chair of the Governance and Human Capital Committee, Mr. Henry Klehm, III, alongside members of the senior management team, led engagements with shareholders representing 18% of shares outstanding. Discussions focused on key business, compensation and board topics, with an emphasis on the Validus acquisition, recently granted performance recognition awards for executives and the Company’s approach to board structure and composition.

Investors generally expressed understanding, and were supportive, of the Governance and Human Capital Committee’s rationale for granting the performance recognition awards, which are intended to incentivize outperformance, support leadership continuity through the critical integration period of Validus and recognize the significant additional responsibilities taken on by our Chief Executive Officer to maximize the value of acquisition. Regarding the structure of the Chief Executive Officer’s performance recognition award, investors sought clarity on its differentiation from the performance-based incentives granted as part of the annual compensation program, as well as the specific metrics tied to the management-related performance objectives for Mr. O’Donnell. In response to shareholder feedback heard during these meetings, we have provided additional detail regarding the unique metrics, time horizon, rigor and performance evaluation of the performance recognition awards in comparison to our annual compensation program, and the Governance and Human Capital Committee’s rationale for the award structure. See “2023 Performance Recognition Awards” in the “Compensation Discussion and Analysis” section for additional disclosure.

Investors also expressed interest in understanding the Board’s rationale and annual review process for its governance practices, including our classified Board structure and Board leadership structure. We have provided additional detail on the Board’s process for reviewing its structure and independent leadership in the section “Board Structure and Engagement.”

Our commitment to sustainability matters has always been a central part of, and integrated with, our corporate strategy at RenaissanceRe and remains one of our core values. Our Board recognizes the importance of investing time and resources into business practices that emphasize environmental sustainability and good corporate citizenship, and oversees internal strategies and related activities through regularly scheduled reports by management to the Board and its committees throughout the year.

Our sustainability strategy focuses on three core areas where we apply our core business strengths to make a meaningful impact on society — promoting climate resilience, closing the protection gap, and inducing positive societal change:

For more than 30 years, we have been a leader in understanding and modeling the impact of climate-related events. We believe that the frequency and severity of natural catastrophes have increased due to human-driven climate change and are focused on preventing and mitigating its impact on society.

We have a long track record of leadership in applying our risk expertise and leveraging our partnerships to increase the economic resiliency of vulnerable communities. Reinsurance plays an important role in helping communities recover after a natural disaster, and we have made significant commitments to reduce the protection gap and mitigate the impact of natural disasters on populations and economies in the developing world. We have a dedicated global team focused on public sector partnership activities to support our continued work in this space.

Our employees are our most valuable asset, and we are committed to maintaining a culture that supports every one of them in their personal and professional journey. We share a passion for solving our customers’ biggest challenges through a collaborative and entrepreneurial culture that empowers employees and rewards creative thinking.

Our Amended and Restated Bye-laws (our “Bye-laws”) provide that the number of directors shall be determined by our Board and shall be between eight and eleven members. Currently, that number has been fixed by the Board at eleven. The Board consists of three classes, with directors of one class elected each year for terms extending to the annual general meeting of shareholders held in the third year following their election.

The terms of our Class II directors will expire at the Annual Meeting. The Board, upon the recommendation of the Governance and Human Capital Committee, has nominated Mr. Gray, Mr. Hennes and Mr. O’Donnell for election as Class II directors. If elected at the Annual Meeting, these Class II director nominees will serve until the expiration of their terms in 2027, or until their earlier resignation or removal.

Mr. Gray, Mr. Hennes and Mr. O’Donnell were each last elected to the Board at our 2021 Annual General Meeting of Shareholders.

We have no reason to believe that any of the nominees will be unable or unwilling to serve if elected. However, if a nominee becomes unable or unwilling to accept a nomination or election, the Board may select a substitute nominee and the common shares represented by proxies may be voted for such nominee unless shareholders indicate otherwise.

Each nominee for election to serve as a Class II director who receives a majority of the votes cast at the Annual Meeting will be elected as a director. However, if a nominee fails to receive a majority of the votes cast at the Annual Meeting, such nominee will tender an irrevocable resignation that will be effective upon the Board’s acceptance of such resignation, as codified in our Corporate Governance Guidelines. Upon the submission of the resignation, the Governance and Human Capital Committee will promptly consider the resignation and make a recommendation to the Board, and the Board will consider any relevant factors in deciding whether to accept or reject the director’s resignation.

Each nominee has extensive business experience, education and personal skills that qualify him or her to serve as an effective Board member. The specific experience and qualifications of the nominees are set forth below. We encourage you to read the biographies of our nominees and continuing directors, as well as the discussion of our Board’s composition, below.

The members of the Board whose terms do not expire at the Annual Meeting and who are not standing for election at this year’s Annual Meeting are set forth below.

We believe the Board benefits from taking a holistic approach to its composition and refreshment. Our Board values a mix of new directors, who bring fresh perspectives, and longer-serving directors, who bring continuity and breadth of experience with our business, strategies and risk management processes. Our Board has developed comprehensive and ongoing assessment and succession planning processes and regularly reviews the biographical backgrounds and skills of its current members and potential nominees in connection with its ongoing evaluation of Board composition and refreshment.

 

The Governance and Human Capital Committee is responsible for identifying and recommending qualified candidates for nomination to the Board.

 

The Board considers the diversity, skills and experience of candidates in the context of the needs of the Board as a whole. When identifying and considering potential director nominees and evaluating the current composition of our Board, the Governance and Human Capital Committee focuses on:

The Board also considers outside commitments of directors, including service on other boards and board committees, in assessing their ability to serve on the Board and committees of the Board.

As discussed in our Corporate Governance Guidelines, we do not set specific criteria for directors, but believe that candidates should show evidence of leadership in their particular field and have broad experience and the ability to exercise sound business judgment. In selecting directors, the Board generally seeks a combination of qualities and experience that will contribute to the exercise of the duties of the Board, including active or former chief executive or senior officers of major complex businesses, leading academics and entrepreneurs. The factors considered by the Governance and Human Capital Committee when evaluating individual director nominees include:

The Governance and Human Capital Committee has the discretion to weigh these, and other, factors as it deems appropriate. The relative importance of these factors may vary from candidate to candidate, depending on our evolving circumstances, and no particular criterion is necessarily applicable to all prospective nominees.

The Board recognizes that a robust and constructive evaluation process is an essential part of good corporate governance and Board effectiveness. Pursuant to its charter, the Governance and Human Capital Committee has responsibility for oversight of the Board’s annual overall effectiveness reviews, review of individual director performance and similar matters.

 

Our Governance and Human Capital Committee oversees the orientation process for new directors. Each new director and new member of a Board committee participates in a comprehensive orientation program run by management. The orientation includes presentations by senior management to familiarize the new director with our strategic plan, significant accounting and risk management issues, compliance programs, Code of Ethics and other relevant topics.

We encourage our directors to participate in continuing education programs and reimburse them for reasonable expenses associated with third-party training programs relating to our business, industry or the discharge of Board duties. We also provide ongoing education programs on topics relevant to RenaissanceRe and our industry as part of regular Board and committee meetings, and directors are invited and encouraged to visit our offices to meet with management.

Our Board believes that the backgrounds and qualifications of the directors and director nominees, both individually and considered as a group, should provide a diverse range of viewpoints, backgrounds, skills, experiences, expertise, and abilities that will allow the Board to fulfill its responsibilities, taking into account our evolving strategic direction and needs. The Governance and Human Capital Committee evaluates and discusses diversity at both the Board and committee levels when carrying out its director selection, recruitment and nomination obligations and also when assessing the performance of current directors. This assessment is undertaken at least annually.

Our Board is committed to expanding the pool from which it selects qualified director candidates and is focused on seeking candidates who embody all aspects of diversity, including racial, ethnic and gender diversity, while considering the skills and experience of the Board as a whole. The Governance and Human Capital Committee may use search firms to identify potential candidates to stand for election to the Board. Our Corporate Governance Guidelines formalize our commitment to source diverse Board candidates.

Our Board has a long track record of gender diversity among its members, from our first gender diverse director being elected in 2005 to having over a third of our Board embody gender diversity, with four gender diverse directors serving from 2019 to 2022. We are aware that the gender diversity of our Board has recently fallen below 30% as a result of the retirement of a long-serving director, and we continue to consider gender diversity in our director search process.

The Governance and Human Capital Committee has reviewed the independence of each of our current directors and director nominees and affirmatively determined that each of Drs. Rahmani and Jeworrek, Mses. Sanders and Trudell and Messrs. Bushnell, Gibbons, Gidumal, Gray, Hennes and Klehm are independent. Mr. O’Donnell is not independent because of his employment as our President and Chief Executive Officer.

The New York Stock Exchange (the “NYSE”) listing standards require that a majority of our directors be independent. For a director to be considered independent, the Board must determine that the director does not have any direct or indirect material relationship with us either directly or as a partner, shareholder or officer of an organization that has a relationship with us. Our Corporate Governance Guidelines provide that a majority of our directors will meet the NYSE’s listing standards regarding independence criteria and set forth additional parameters that the Board uses to determine director independence, which we believe are more stringent than the independence requirements in the NYSE listing standards. In addition, the Board considers all relevant facts and circumstances known or reported to it in making independence determinations.

In particular, when making its independence determinations, the Governance and Human Capital Committee considered the following relationships and determined that none of the directors or director nominees involved had a material relationship with us as a result of these relationships. Mr. Hennes serves as a director of Citigroup. We have current and historical financial relationships with Citigroup and its subsidiaries and affiliates, including Citigroup acting in manager roles in several of our securities offerings over the last few years and being a party to letter of credit facilities with us. Ms. Sanders serves as a director of GuideOne Insurance. From time to time, we have entered into reinsurance contracts with GuideOne, all in the ordinary course of business on terms available to similarly situated parties. Mr. Gibbons is the Treasurer and a director of EGL, the parent company of a number of varied businesses in Bermuda, including Coralisle Group Ltd., formerly Colonial Group International (“Coralisle”), and a director of BACL. We have entered into reinsurance contracts with Coralisle which are described under “Certain Relationships and Related Transactions” below. In addition, we have other immaterial business relationships with a variety of the other businesses owned by EGL and BACL, relating primarily to local services and procurement in Bermuda, for which we paid these entities a total of approximately $75,500 in 2023. Mr. Gibbons is not directly involved in the management of Coralisle or any of the other businesses owned by EGL or BACL with which we do business, and all of the transactions were entered into in the ordinary course of business on terms available to similarly situated parties. Furthermore, the EGL and BACL entities did not make payments to, or receive payments from, us in an amount which, in any of the last three fiscal years, exceeded the greater of $1 million or 2% of EGL’s or BACL’s consolidated gross revenues.

Candidates recommended by shareholders for nomination to the Board will be considered and evaluated by the Governance and Human Capital Committee using the same process and criteria that we use to evaluate other candidates, assuming the proper procedures for shareholder nominations are followed. The Governance and Human Capital Committee will consider nominees to the Board recommended by no fewer than 20 shareholders holding in the aggregate not less than 10% of the outstanding paid-up share capital of RenaissanceRe. Any shareholder recommendation must be sent to our Corporate Secretary not less than 60 days prior to the scheduled date of the annual general meeting of shareholders and must set forth for each nominee: (i) the name, age, business address and residence address of the nominee; (ii) the principal occupation or employment of the nominee; (iii) the class or series and number of shares of capital stock of RenaissanceRe that are owned beneficially or of record by the nominee; and (iv) any other information relating to the nominee that would be required to be disclosed in a proxy statement or other filing required to be made in connection with solicitations of proxies for election of directors pursuant to Section 14 of the U.S. Securities Exchange Act of 1934, as amended (the “Exchange Act”) and the rules and regulations promulgated thereunder. The written notice must also include the following information with regard to the shareholders giving the notice:

Such notice must be accompanied by a written consent of each proposed nominee to be named as a nominee and to serve as a director if elected. The Governance and Human Capital Committee may refuse to acknowledge the nomination of any person not made in compliance with the foregoing procedure.

Our Board believes that long-range strategic issues should be discussed and reviewed at regular Board meetings. Our Corporate Governance Guidelines provide that the Board review and critique our strategic plan at least annually, with quarterly reviews of performance in comparison to the financial plan. Senior management and the full Board engage in long-term strategy discussions at least annually, and the Board and committees regularly receive updates from business function leaders on our performance against our tactical plans.

Our strategic plan drives the Board’s goal setting in many areas. For example, the goals of each Board committee are tied to the achievement of the strategic plan and the Governance and Human Capital Committee determines and measures executive compensation against the achievement of strategic goals and objectives.

We consider enterprise-wide risk management to be a key strategic objective and believe that our enterprise-wide risk management processes and practices help to identify potential events that may affect us; quantify, evaluate and manage the risks to which we are exposed; and provide reasonable assurance regarding the achievement of corporate objectives. For each identified and measured risk, we have identified (i) a day-to-day owner and management response, (ii) a process for monitoring and reporting on the risk, (iii) a senior management committee, and (iv) Board and/or committee oversight. We believe that this risk management process, along with our culture and focus on enterprise-wide risk management, ensures effective risk oversight by our Board.

 

We have an integrated approach to ESG, or “sustainability” governance, with cross-collaboration among our Board committees and management. Our Board and its committees are actively engaged in the oversight of sustainability initiatives and our management provides regular reports on progress and developments.

The Governance and Human Capital Committee, pursuant to its charter, is charged with overseeing, monitoring and reviewing our ESG policies, programs and practices. This oversight includes health and safety, DEI and related matters. Our dedicated sustainability team reports to the Governance and Human Capital Committee quarterly, and to the full Board at least annually, on our sustainability initiatives and progress on implementation of our sustainability strategy. In addition, the Governance and Human Capital Committee is actively engaged in the oversight of our employees, work environment, DEI initiatives and compensation practices, and receives regular updates from management on progress and developments, and our executive management team and Governance and Human Capital Committee receive regular reports on progress against our annual human resources tactical plans.

The consideration of the impacts of climate change is integral to our enterprise-wide risk management process. Certain aspects of sustainability are monitored by the full Board or other committees. For example, the Investment and Risk Management Committee is charged with overseeing key financial risks, such as the financial risk of climate change. We have been progressively integrating the consideration of the financial risk of climate change into our governance frameworks, risk management processes and business strategies over the past several years.

 

At their quarterly meetings, each committee reviews and discusses its current and future agendas in the context of our strategic plan and any new Company, industry or market information and identifies matters that should be discussed with other committees or the full Board. In addition, each standing committee reports to the full Board at each quarterly Board meeting. Our Audit, Governance and Human Capital, and Investment and Risk Management Committees coordinate their oversight of our financial and operating risks and routinely collaborate to address specific matters requiring coordination and cross-committee oversight. We believe that these collaborative efforts sustain high levels of enterprise-wide risk management and facilitate sound corporate governance.

We believe that executive succession planning and leadership development are critical to our long-term success and are key to ensuring effective risk oversight and execution of our strategy. Our succession planning programs are designed to ensure that the Board has appropriate oversight. On behalf of the Board, our Governance and Human Capital Committee collaborates with our Chief Executive Officer in the development and monitoring of our programs for long-term executive succession, generally on a quarterly basis. Our Board, in coordination with the Governance and Human Capital Committee, also maintains an emergency succession plan, which is intended to enable us to respond quickly to unexpected vacancies to maintain the continuity of our business operations and minimize disruptions.

The Governance and Human Capital Committee dedicates at least one meeting each calendar year to an in-depth review of talent development plans, including development plans for internal succession candidates and identification of potential external succession candidates. Updates to the executive succession plan are made as necessary.

To further support the succession planning process, the Governance and Human Capital Committee is regularly presented with information on the Company’s employee population, ranging from the results of engagement surveys to detailed succession plans for senior or critical roles. To foster diverse talent, we apply a DEI lens to the selection process for our leadership and management development programs. Together, the Chief Executive Officer, the Chief Human Resources Officer and the management governance committee identify individuals who they believe have demonstrated potential to grow into senior executive positions and review these individuals with the Governance and Human Capital Committee. The careers of these individuals are monitored to ensure that over time they have appropriate exposure both to the Board and to our business. These individuals interact with our Board in various ways, including through participation in Board meetings and other Board-related activities and meetings with individual directors. The Governance and Human Capital Committee regularly briefs the full Board on these matters and has overseen recent changes to our leadership structure in accordance with our succession planning processes.

Our Board and management have a strong commitment to effective corporate governance. We believe we have a comprehensive corporate governance framework which takes into account applicable regulatory requirements and best practices. The key components of this framework are set forth in the following documents:

The Board regularly reviews corporate governance developments and modifies our Corporate Governance Guidelines, Code of Ethics, committee charters and key Board practices when it believes modifications are warranted. A copy of each of these documents is published on our website at www.renre.com under “Investors—Corporate Governance,” except our Bye-laws, which are filed with the SEC and can be found on the SEC website at www.sec.gov. Each of these documents is available in print to any shareholder upon request.

Our Code of Ethics applies to all of our directors and employees, including our principal executive officer, principal financial officer and principal accounting officer, and all of our employees performing financial or accounting functions. Our Code of Ethics is available without charge on our website, www.renre.com, under “Investors—Corporate Governance.” We will also provide a printed copy of our Code of Ethics to any shareholder upon request. We intend to disclose any amendments to our Code of Ethics by posting them on our website. Any waivers of our Code of Ethics applicable to our directors, principal executive officer, principal financial officer, principal accounting officer, controller and other executive officers who perform similar functions will be disclosed by filing a Current Report on Form 8-K with the SEC.

Our Board regularly evaluates its structure to ensure that it is best serving the interests of the Company and our shareholders. The Governance and Human Capital Committee is responsible for overseeing overall Board effectiveness, and regularly discusses the suitability of the Board’s structure for the Company at its meetings. The Board currently maintains a classified board structure led by an independent, Non-Executive Chair, similar to certain of our peers in the industry. The Board has determined that its current classified structure provides considerable value due to the continuity and stability that it creates, especially given the complexities and volatility of our business and the industry in which we operate. Our Board believes that its structure does not hinder director accountability or investor participation, and we regularly engage with shareholders on this matter, share relevant feedback with the entire Board, and have continued to evolve our governance, compensation and sustainability practices in response to this feedback over the past several years.

Pursuant to our Corporate Governance Guidelines, the Chair of the Board may be an officer/director or an outside director and may or may not be the Chief Executive Officer, at the option of the Board. The Board believes it should be free to make these determinations depending on what it believes is best for the Company and our shareholders in light of all the circumstances. At this time, the Board has determined that it is appropriate to separate the roles of Chair and Chief Executive Officer and to have a Non-Executive Chair of the Board. The Board believes that having an independent director serve as Non-Executive Chair of the Board is in the best interests of the Company and our shareholders at this time and that this structure currently assists the independent directors in the oversight of the Company and facilitates participation of the independent directors in setting agendas and establishing priorities and procedures for the work of the Board.

Currently, Mr. Gibbons serves as the Non-Executive Chair of the Board. In addition to chairing each meeting of the Board, the Non-Executive Chair of the Board has significant responsibilities, including: (i) having the authority to call meetings of the Board; (ii) setting the agendas for Board meetings and executive sessions to ensure that Board members receive the information necessary to fulfill the Board’s primary responsibilities; (iii) chairing executive sessions of the independent directors; (iv) briefing the Chief Executive Officer on issues that arise in the executive sessions, as appropriate; (v) facilitating discussion among the independent directors on key issues and concerns that arise outside of Board meetings and serving as a non-exclusive conduit to communicate views, concerns and issues of the independent directors to the Chief Executive Officer; (vi) interviewing candidates for directorship; (vii) facilitating the assessment of the Board’s effectiveness, at the direction of the Governance and Human Capital Committee; and (viii) together or in coordination with the Chief Executive Officer, representing the organization in external interactions with shareholders, employees and other stakeholders.

The Non-Executive Chair of the Board typically does not serve as a member of the Board’s three principal standing committees (the Audit Committee, the Governance and Human Capital Committee, and the Investment and Risk Management Committee), but rather attends such meetings and other functions of the committees on an ex officio basis as warranted by the facts and circumstances. The Non-Executive Chair of the Board serves as a member of the Transaction Committee and the Offerings Committee, which meet on an as-needed basis.

Our Board held the following meetings of the Board and committees during 2023:

Each of our directors attended 75% or more of the meetings of the Board and committees of the Board on which they served during 2023 (during the periods that they served). For more information on our committees, please see below.

While we do not have a formal policy with regard to our directors’ attendance at annual general meetings of shareholders, generally it is the practice of our Board to attend such meetings. All of our directors attended our 2023 Annual General Meeting, which was held on May 9, 2023 in Bermuda.

Separate executive sessions of our non-management directors are held in conjunction with each regular quarterly Board meeting. The Non-Executive Chair of the Board presides at these executive sessions of the Board. The standing committees of the Board also conduct regular executive sessions, which are chaired by the respective chairs of the committees.

Any shareholder or other party may communicate directly with the Board, any committee of the Board, any member of the board or our non-management directors as a group by writing to the intended recipient in the care of the Corporate Secretary. Shareholders can send communications electronically through our website at www.renre.com by clicking on “email” under “About Us—Contacts— Legal or Corporate Information” or by mail to: RenaissanceRe Holdings Ltd., P.O. Box HM 2527, Hamilton HMGX, Bermuda, Attn: Corporate Secretary. If properly addressed, communications will be forwarded to the intended recipient unopened.

The Audit Committee, on behalf of itself and our other non-management directors, has established procedures to enable employees or other parties who may have a concern about our conduct or policies to communicate that concern. Our employees are encouraged and expected to report any conduct which they believe in good faith to be an actual or apparent violation of our Code of Ethics. In addition, as required by the Sarbanes-Oxley Act of 2002, the Audit Committee has established procedures for receiving, retaining and treating complaints regarding accounting, internal accounting controls or auditing matters, as well as for confidential submission by Company employees of concerns regarding questionable accounting or auditing matters, among other things. These communications may be anonymous, and may be submitted in writing, e-mailed or reported by phone through various internal and external mechanisms as provided on the Company’s internal website. Additional procedures by which internal communications may be made are provided to each employee. Our Code of Ethics prohibits any employee or director from retaliating or taking any adverse action against anyone for raising or helping to resolve an integrity concern.

The Board maintains three principal standing committees: the Audit Committee, the Governance and Human Capital Committee, and the Investment and Risk Management Committee. The primary responsibilities of these committees are summarized below and more fully described in their charters. These committees may delegate any of their responsibilities to a subcommittee composed of one or more members of the committee. In addition, the Board maintains two standing, special purpose committees: the Transaction Committee and the Offerings Committee. The responsibilities of these committees are summarized below.

The Board has determined that each member of the Audit Committee and the Governance and Human Capital Committee meets the applicable independence standards of the Commission and the NYSE. The Board has also determined that each member of the Audit Committee is financially literate and has accounting or related financial management expertise as required by NYSE rules and is an “audit committee financial expert” under the Commission’s rules, in each case, given his or her experience as set forth in his or her biography above.

The Governance and Human Capital Committee has the authority to select, retain and dismiss compensation consultants, financial and other advisors and independent legal counsel as it deems necessary in accordance with the procedures set forth in the charter and considering independence and potential conflicts of interest. For a discussion regarding our independent compensation consultant, please see “Independent Compensation Consultant” below.

In addition, our Governance and Human Capital Committee reviews our compensation programs for consistency with our risk management practices and to assist us in structuring our programs in a manner that aligns our executives and employees with the long-term interests of shareholders in light of the market cycles and earnings volatility that characterize our industry. For a discussion regarding our compensation policies and practices as they relate to our risk management see “Compensation and Risk Management” below.

Mr. Bushnell, Mr. Gidumal, Mr. Klehm and Ms. Trudell served on the Governance and Human Capital Committee during the 2023 fiscal year. No member of the Governance and Human Capital Committee during the 2023 fiscal year was an officer or employee of the Company during the 2023 fiscal year or was formerly an officer of the Company, or had any relationship requiring disclosure by the Company as a transaction with a related person under Item 404 of Regulation S-K (“Regulation S-K”) of the U.S. Securities Act of 1933, as amended (the “Securities Act”). No executive officer of the Company served on any board of directors or compensation committee of any other company for which any of our directors served as an executive officer at any time during the 2023 fiscal year.

The Transaction Committee presently consists of Dr. Jeworrek and Messrs. Gibbons, Gray and O’Donnell (Chair). The Transaction Committee has the authority of the Board to consider and approve, on behalf of the full Board, certain strategic investments and other possible transactions.

The Offerings Committee presently consists of Dr. Jeworrek and Messrs. Gibbons, Gray and O’Donnell (Chair). The Offerings Committee has the authority to consider and approve, on behalf of the full Board, transactions pursuant to our shelf registration program, including setting the terms, amount and price of any such offering.

We have adopted a written policy with respect to the review, approval and ratification of transactions with related persons. The policy covers, among other things, transactions between us and any of our executive officers, directors, nominees for director, any of their immediate family members or any other related persons as defined in Item 404 of Regulation S-K. Each transaction covered by this policy is reviewed by the Governance and Human Capital Committee to determine whether the transaction is in the best interests of the Company and our shareholders. Pursuant to the policy, our Governance and Human Capital Committee also conducts a reasonable prior review and oversight of all related-party transactions required to be disclosed pursuant to Item 404 of Regulation S-K for potential conflicts of interest, including to determine whether any such transaction is inconsistent with the interests of the Company and our shareholders. The transactions described below include certain transactions we have entered into with parties that are, or could be deemed to be, related to us.

BlackRock, Inc. (“BlackRock”) reported a beneficial ownership interest of more than 5% of our common shares as of December 31, 2023. Affiliates of BlackRock provide investment management, risk analytics and investment accounting services to us. During 2023, we incurred $7.0 million in fees relating to these services. These fees were at then-prevailing market rates determined pursuant to arm’s-length negotiations between us and such affiliates.

Mr. Gibbons is the Treasurer of EGL, the parent company of Coralisle. We entered into reinsurance contracts with Coralisle pursuant to which we received premiums of approximately $21,000 from Coralisle in 2023, which included current underwriting year premium of $167,000 offset by premium adjustments for prior underwriting years of $146,000. We paid claims to Coralisle of approximately $7,000 in 2023. We renewed certain of these reinsurance contracts in December 2023 and we expect to receive premiums of approximately $143,000 from Coralisle in 2024 as a result of those renewals. To date in 2024, we have not paid any claims to Coralisle. In his position at EGL, Mr. Gibbons is not directly involved in the management of Coralisle, and all of these transactions with Coralisle were entered into in the ordinary course of business on terms available to similarly situated parties.

On January 24, 2024, The Bank of New York Mellon Corporation (“BNYM”) reported a beneficial ownership interest of more than 5% of our common shares as of December 31, 2023 and may continue to beneficially own more than 5% of our common shares outstanding. Affiliates of BNYM provide certain custodian services to us. During 2023, we incurred $3.7 million in fees relating to these services and we expect to incur slightly higher fees in 2024 due to additional assets under management. These fees were and will be at then-prevailing market rates determined pursuant to arm’s-length negotiations between us and such affiliates.

Pursuant to their employment agreements, members of our management governance committee, which consists of Messrs. O’Donnell, Qutub, Curtis and Marra, and Ms. Bender, are permitted business use and a limited amount of Company-funded personal use (with a value up to the aggregate incremental cost to us of $85,000 each) of our fractional interest program with NetJets Aviation Inc. (“NetJets”). Since 2020, in light of concerns for safety including, among other reasons, the COVID-19 pandemic, and continuing commercial travel limitations in Bermuda, the Governance and Human Capital Committee adopted a policy allowing our management governance committee members additional Company-funded personal use of our NetJets program. The aggregate incremental cost to us of any personal use for named executive officers is included in the Summary Compensation Table below. Our executive officers pay imputed income tax on the value of these benefits and are not entitled to tax gross-ups on any perquisites. In addition, Messrs. O’Donnell, Curtis and Qutub have each entered into an aircraft use agreement with us which allows them to use our fractional interest program with NetJets for additional travel beyond that which is provided for in their employment arrangements, provided that they pay for such use in advance of any trip at the fully loaded variable rate (which rate represents our aggregate incremental cost of such use within the meaning of Regulation S-K and the rules and other guidance of the Commission). They must maintain a deposit with us from which we are authorized to withdraw funds in order to satisfy any amounts owed under the agreement. The form of aircraft use agreement was approved by the Governance and Human Capital Committee. None of our executive officers had any additional personal use of the aircraft interest for travel during 2023 for which they were required to reimburse us. For additional information regarding our executive officers’ use of our corporate aircraft, see “Other Benefits and Perquisites” below.

As discussed under “Other Benefits and Perquisites” below, we provide housing allowances to certain of our named executive officers, as well as to other executive officers and employees. The amount of the housing allowance is included in the Summary Compensation Table for each named executive officer (see “All Other Compensation Table” below). Our executive officers pay imputed income tax on the value of these benefits and are not entitled to tax gross-ups on any perquisites. In 2021, one of our subsidiaries acquired a property in Bermuda previously subject to a long-term lease and subsequently leased this property to Mr. O’Donnell for his Bermuda residence at market rates, consistent with his historical housing benefits.

RenaissanceRe provides support to various charitable organizations in Bermuda and other communities in which we operate, including organizations that support insurance industry education and training, crime prevention, substance abuse prevention, affordable housing and educational assistance. As part of our efforts, we match donations made by our employees to appropriately registered charities up to certain maximum amounts and make direct charitable contributions. Certain of our executive officers and directors, director nominees, and spouses of certain of these persons, serve and have served as directors, officers or trustees of some of these organizations. We did not contribute more than $120,000 to any one charity in 2023 for which any of our executive officers and directors, director nominees and spouses of certain of these persons served as a director, officer or trustee.

The following table sets forth information concerning compensation paid to each director who served on the Board during 2023, other than Mr. O’Donnell, whose compensation as our President and Chief Executive Officer is set forth under “2023 Summary Compensation Table” below:

The Governance and Human Capital Committee reviews director compensation annually. While the Governance and Human Capital Committee does not target specific director pay levels against market data, with the assistance of Mercer (U.S.) Inc. (“Mercer”), its independent compensation consultant, the Governance and Human Capital Committee analyzes the competitiveness of our director compensation using market data for non-employee directors of the same group of peer companies used to evaluate executive compensation (see “The Market for Talent” below). The Governance and Human Capital Committee reviews both the structure and amount of non-employee director compensation paid at these peer companies. In addition, since the talent market for directors is broader than the market for executives, the Governance and Human Capital Committee also reviews director compensation among companies in the S&P 500 indices. In connection with its annual 2023 review, the Governance and Human Capital Committee determined to increase certain elements of non-executive director compensation, as described below, to maintain the Company’s competitive positioning relative to peers and the general market for directors.

Annual Cash Retainers. During 2023, each of our non-employee directors other than the Non-Executive Chair of the Board received an annual cash retainer of $125,000, increased from $110,000 in 2022. Our Non-Executive Chair of the Board received an annual cash retainer of $190,000. In addition, the Chairs of our Audit Committee, Governance and Human Capital Committee, and Investment and Risk Management Committee each received a committee chair cash retainer of $35,000. These amounts were consistent with the amounts paid in 2022. If a non-employee director joins the Board after the start of the fiscal year, the director will be paid a prorated retainer based on the number of regularly scheduled Board meetings anticipated to be attended as director, subject to a minimum of 50% of the annual retainer fee.

We reimburse all directors for expenses incurred in connection with service on the Board, including reimbursement of expenses incurred in connection with attending educational seminars. The Non-Executive Chair of the Board is reimbursed for expenses incurred in connection with attending certain industry events and functions. Generally, spousal travel on our corporate aircraft in connection with a business-related trip of a director is permitted, with spousal travel added to the director’s reported U.S. federal income, as applicable, based on the standard industry fare level valuation method. There is no incremental cost to us of providing this benefit and we do not reimburse the directors for the additional tax associated with this benefit.

Equity Awards. Our Governance and Human Capital Committee weighs directors’ compensation heavily in equity-based incentive awards to further align their interests with the long-term interests of our shareholders. During 2023, each non-employee director other than the Non-Executive Chair of the Board received a grant of restricted shares valued at approximately $165,000, and the Non-Executive Chair of the Board received a grant of restricted shares valued at approximately $315,000. The values of these grants was increased by $10,000 from the 2022 grants. Restricted shares granted to our non-employee directors generally vest in equal annual installments over three years. These restricted shares generally accelerate and vest on a director’s separation from service on the Board unless a director is requested to depart the Board for cause, in which case such restricted shares are forfeited. Dividends are paid currently on time-vested restricted shares. Non-employee directors who start mid-year receive a full-value annual restricted stock grant. The date of grant for such awards will be the director’s start date, and the awards will vest on the same dates as the regular director grants.

Limitation on Non-Employee Director Compensation. Pursuant to the RenaissanceRe Holdings Ltd. 2016 Long-Term Incentive Plan (the “2016 LTI Plan”), the maximum value of any awards granted to any non-employee director in any one calendar year, taken together with any cash fees paid to such non-employee director during such calendar year, may not exceed $1,500,000.

Pursuant to our equity ownership policy for independent directors, which is designed to further our goal of aligning the interests of our directors and shareholders, each of our independent directors is required to hold common shares (including vested and unvested restricted shares) having a value equal to five times their then-current annual cash retainer or such lesser amount as the director has been granted to date. Our independent directors generally are not permitted to sell any of the equity granted to them unless they have met their ownership requirements. As of December 31, 2023, all of our independent directors had satisfied their ownership requirements other than Mr. Gidumal, who did not join the Company until May 16, 2022, and Dr. Jeworrek, who did not join the Company until May 9, 2023. However, Mr. Gidumal and Dr. Jeworrek are in compliance with our guidelines because they are not required to purchase shares in the open market in order to satisfy their ownership requirements.

Our directors are subject to our anti-hedging, anti-pledging and other trading policies, which prohibit transactions in our securities outside of designated “window” periods (except pursuant to previously adopted and approved Rule 10b5-1 plans), hedging the market value of any of our securities, and short sales of, or margin loans on, our securities.

Our executive officers provide functional oversight of our business units and have primary responsibility for setting Company policy and decision-making authority. Our executive officers, as defined in the Exchange Act, include our Chief Executive Officer, Chief Financial Officer, Chief Portfolio Officer, Group Chief Underwriting Officer, Group General Counsel, Chief Investment Officer, and Chief Accounting Officer.

We are submitting to our shareholders an advisory vote, commonly known as a “say-on-pay” proposal, to approve the compensation of our named executive officers as disclosed in this proxy statement pursuant to Item 402 of Regulation S-K. This advisory vote gives shareholders a mechanism to convey their views about our executive compensation program and policies. This vote is not intended to address any specific item of compensation, but rather the overall compensation of our named executive officers and the philosophy, policies and practices described in this proxy statement. The following resolution will be submitted for a shareholder vote at our Annual Meeting:

“RESOLVED, that the shareholders of the Company approve, on an advisory basis, the compensation of the Company’s named executive officers, as disclosed in the proxy statement for the Company’s Annual General Meeting pursuant to Item 402 of Regulation S-K, including the Compensation Discussion and Analysis, compensation tables and narrative discussion.”

We currently hold say-on-pay votes annually, and we expect to hold the next such vote at our 2025 Annual Meeting.

The Board urges you to review carefully the information under the heading “Executive Compensation” in this proxy statement and to vote, on an advisory basis, to approve the compensation of our named executive officers. Although your vote on executive compensation is not binding on the Board or the Company, the Board values the views of the Company’s shareholders. The Board and the Governance and Human Capital Committee will review the results of the vote and take them into consideration in addressing future compensation policies and decisions.

Approval of this proposal requires the affirmative vote of a majority of the votes cast at the Annual Meeting and entitled to vote thereon.

Dear Fellow Shareholders,

On behalf of RenaissanceRe’s entire Board of Directors, we want to thank you for your continued investment in our company and your support of our leadership team during this past year. As members of the Governance and Human Capital Committee, we have been thoughtful in designing an executive compensation program that drives value for you, our shareholders. Our program ties a significant portion of the compensation of our Chief Executive Officer and other named executive officers to the Company’s short- and long-term performance, and the incentives we utilize are designed to directly support our strategy and risk management practices, encourage operational and financial consistency over market cycles and promote our team-based approach.

We are proud of the strategic milestones our Company achieved during 2023, including the completion of the Validus acquisition in November. The acquisition and its quick completion would not have been possible without our Chief Executive Officer and other continuing named executive officers, who successfully executed the transaction with financial terms that made it immediately accretive to shareholders upon completion. We believe the acquisition marks a transformative point in our Company’s strategy as a global property and casualty reinsurer, as it provides additional scale, increases our importance with customers and brokers and presents the Company with significant opportunity to grow in the years ahead.

In recognition of this opportunity, this past November, the committee determined to grant a performance recognition award to our Chief Executive Officer in the form of a performance share award and a restricted share award. We thoughtfully designed this award to support leadership continuity, encourage retention and incentivize the successful integration of Validus and future outperformance by creating a structure that is rigorous and distinct from our annual compensation plan in terms of the metric, targets, performance period and management objectives. We also granted separate performance recognition awards to the other continuing named executive officers that played an integral role in the acquisition with terms similar to our annual performance share awards.

The Company engaged with shareholders this past year to seek their perspectives on our overall approach to executive compensation, as well as the performance recognition awards. The Chair of the Governance and Human Capital Committee participated in a number of these meetings and shared shareholder feedback with the Committee and our full Board. We believe the current structure of the award reflects shareholders’ preference for a rigorous, meaningful incentive to incentivize outperformance over the long-term, support leadership continuity during the critical integration period and recognize the importance of successful execution of key performance objectives that we believe will maximize the value of the acquisition. In response to shareholder feedback, we have provided enhanced disclosure around our rationale for granting the awards and the strategic terms and performance conditions we chose for the awards in this proxy statement.

We encourage you to review the following “Compensation Discussion and Analysis”. We remain committed to ongoing shareholder engagement so that our compensation practices continue to reflect shareholder input.

Sincerely,

Henry Klehm, III, Chair

Cynthia Trudell

David Bushnell

Our named executive officers are:

RenaissanceRe is a global provider of reinsurance and insurance. Our mission is to match desirable risk with efficient capital to achieve our vision of being the best underwriter. We believe that this will allow us to produce superior returns for our shareholders over the long term, and to enable our purpose of protecting communities and enabling prosperity. We seek to accomplish these goals by (i) being a trusted, long-term partner to our customers for assessing and managing risk, (ii) delivering responsive and innovative solutions, (iii) leveraging our core capabilities of risk assessment and information management, (iv) investing in these core capabilities in order to serve our customers across market cycles, and (v) keeping our promises. Our strategy focuses on operating as an integrated system of three competitive advantages: superior risk selection, superior customer relationships and superior capital management.

We have a team-based approach to leading, managing and operating the Company. Our executives develop and implement our strategy on a Company-wide basis, in addition to being responsible for their specific business units and functions. Our executive compensation program is designed to reflect this approach, rewarding executives based on overall Company performance.

 

Over the last several years, we have executed on our multi-year strategy to transform our business and position RenaissanceRe to succeed in the rapidly evolving reinsurance market. On November 1, 2023, we completed the Validus acquisition, which was immediately accretive to our shareholders. We believe that the Validus acquisition further accelerated our strategy as a global property and casualty reinsurer, providing additional scale and increasing our importance with customers and brokers. Through the Validus acquisition, we gained access to a large, attractive book of reinsurance business that was closely aligned with our existing business mix, accelerating our growth in a favorable market. We believe our increased scale following the Validus acquisition positions us among the five largest global property and casualty reinsurers. Our Chief Executive Officer and other continuing named executive officers were instrumental in driving the financial terms of the transaction and its successful execution, as well as the ongoing integration of Validus.

Over the last 10 years, we have made key strategic decisions to build the capabilities and scale that we believe will allow us to generate superior returns in an evolving marketplace. We have differentiated and selectively grown our underwriting portfolio in response to market conditions and the ongoing impacts of climate change. Over time, we have successfully grown our three principal drivers of profit: underwriting income; fee income; and investment income. We believe the successful implementation of our strategy is a reflection of the experience and skill of our leadership, including our named executive officers, along with our superior underwriting expertise. With these

changes and our general increase in scale, we have become a more complex organization, requiring enhanced management and Board oversight to appropriately align our enterprise risk management to maximize shareholder returns and support the long-term sustainability of the Company.

To achieve the goals of our executive compensation program, the Governance and Human Capital Committee ties a significant portion of the compensation of our Chief Executive Officer and other named executive officers to the Company’s short- and long-term performance. We measure success against a mix of key performance metrics, the majority of which are objectively measurable. We believe this mix of metrics aligns the interests of our executives and shareholders and rewards our Chief Executive Officer and other named executive officers for delivering strong performance on our strategic plan without incentivizing excessive risk taking.

 

The Governance and Human Capital Committee does not mandate a specific allocation among the compensation components, but believes that a majority of total direct compensation should be at-risk and subject to the achievement of performance objectives and/or our stock price performance as well as service-based criteria. While all of our named executive officers have a significant portion of their compensation at-risk, their annual target pay mix varies in accordance with their roles and responsibilities. Mr. O’Donnell has the highest overall percentage of performance-based and at-risk pay, followed by the other continuing named executive officers, who report to Mr. O’Donnell and are members of our management governance committee, along with Mr. O’Donnell.

The Governance and Human Capital Committee conducted an in-depth assessment of the competitive pay environment in 2023 with input from its independent compensation consultant, Mercer, and determined that the compensation program continued to reflect the needs of the Company, with the majority of executive pay being at-risk and subject to successful execution against pre-set performance metrics. The annual target pay mixes for the named executive officers were generally consistent with the prior year, except for Mr. Marra and Ms. Bender, whose target pay mixes became more heavily weighted towards at-risk pay, as their roles changed and responsibilities increased during the year, with Mr. Marra being promoted to Executive Vice President and Group Chief Underwriting Officer and joining the management governance committee in January 2023, and Ms. Bender being promoted to Executive Vice President, Group General Counsel and Corporate Secretary and joining the management governance committee in June 2022. The details of the pay mix are discussed below under “Principal Components of Our Executive Compensation Program.”

In November 2023, we granted performance recognition awards to our continuing named executive officers. Those awards are excluded from the target pay mix in the charts below as they do not represent an annual component of compensation and are described in more detail in “2023 Performance Recognition Awards” below.

The annual target pay mix for our Chief Executive Officer and each of our other continuing named executive officers for 2023 was:

 

Following the successful acquisition of Validus in November 2023, the Governance and Human Capital Committee granted performance recognition awards to Mr. O’Donnell and the other continuing named executive officers. The awards are intended to incentivize significant outperformance, support leadership continuity through the critical integration period of Validus and recognize the significant additional managerial and oversight responsibilities taken on by our Chief Executive Officer that will be required to maximize the value of the Validus acquisition.

 

When reviewing the performance and considering the compensation of our named executive officers, the Governance and Human Capital Committee considers our strategic, operational and financial performance over both the short and long term. The Governance and Human Capital Committee evaluates and sets performance goals that are designed to be rigorous, with the goals set at the time of grant for all performance-based compensation.

In 2023, we benefitted from strong execution of our consistent long-term strategy. We believe that the Validus acquisition further accelerated our strategy at a critical juncture in the reinsurance cycle. With respect to the performance metrics applicable to our annual incentive bonus, we saw strong performance against our strategic plan, with the highest operating return on average common equity in our peer group, the best combined ratio in our peer group, and gross premiums written above budget. As a result, our 2023 annual incentive bonuses paid out at 182% of target.

For metrics applicable to our performance share awards, we achieved above-target performance on both metrics – average change in book value per common share plus change in accumulated dividends over the three-year performance cycle and three-year average underwriting expense ratio rank compared to peers. As a result, our performance shares for the 2021 to 2023 performance period paid out at 190%. The graphic below provides supplemental disclosure and should not be viewed as a substitute for the disclosure included in “Pay Versus Performance.”

 

We have always been, and remain, committed to continually reviewing and improving our executive compensation program to reflect the views of our shareholders and implement commonly-viewed best practices. Some highlights of the best practices we have implemented in our executive compensation program include the following:

 

We recognize the value of engaging in a dialogue with our shareholders to solicit their views and input. Our ongoing engagement includes interactions led by our investor relations team with many of our largest shareholders, and regular participation by members of our executive leadership in investor conferences. Members of senior management also engage with investors in meetings that are primarily focused on corporate governance, executive compensation, and sustainability topics, some of which are led by an independent director. Our Board appreciates the insights gained in these discussions and receives a summary of shareholder engagement at each quarterly Board meeting. The Governance and Human Capital Committee is also provided with a detailed summary of direct shareholder communications at each quarterly committee meeting.

 

In early 2024, we conducted targeted governance-focused outreach to shareholders representing 53% of shares outstanding and engaged with all shareholders who accepted the outreach request, encompassing 39% of shares outstanding. Of these meetings, the Chair of the Governance and Human Capital Committee, Mr. Henry Klehm, III, alongside members of the senior management team, led engagements with shareholders representing 18% of shares outstanding. Discussions focused on key business, compensation and board topics, with an emphasis on the Validus acquisition, recently granted performance recognition awards for executives and the Company’s approach to board structure and composition.

Investors generally expressed understanding and were supportive of the Governance and Human Capital Committee’s rationale for granting the performance recognition awards, which are intended to incentivize outperformance, support leadership continuity through the critical integration period of Validus and recognize the significant additional responsibilities taken on by our Chief Executive Officer to maximize the value of acquisition. Regarding the structure of the Chief Executive Officer’s performance recognition award, investors sought clarity on its differentiation from the performance-based incentives granted as part of the annual compensation program, as well as the specific metrics tied to the management-related performance objectives for Mr. O’Donnell. In response to shareholder feedback heard during these meetings, we have provided additional detail regarding the unique metrics, time horizon, rigor and performance evaluation of the performance recognition awards in comparison to our annual compensation program, and the Governance and Human Capital Committee’s rationale for the award structure. See “2023 Performance Recognition Awards” in this “Compensation Discussion and Analysis” section for additional disclosure.

In order to design an executive compensation program that aligns the interests of our executives with the long-term interests of our shareholders, our Governance and Human Capital Committee leads a rigorous and continuous process evaluating our executive compensation program throughout the year.

 

Our ability to attract and retain talented executive officers is critical to achieving our strategic goals. We believe that the pool of candidates that meet our criteria is small and that competition for talent continues to increase.

While the Governance and Human Capital Committee does not target specific compensation component levels or total compensation of the named executive officers against market data, it periodically assesses the competitiveness of the compensation levels of our named executive officers and considers the overall competitive market in which we operate. With the assistance of management and its independent compensation consultant, Mercer, the Governance and Human Capital Committee uses market data of a group of peer companies to conduct this assessment.

The Governance and Human Capital Committee dedicates significant time and effort to developing a relevant compensation peer group for the Company and works with Mercer and management to regularly review and assess the peer group to evaluate its continued applicability. Our compensation peer group is used to set and analyze our executive compensation program and levels. It is composed of companies with significant reinsurance operations and risk portfolios that are comparable to ours, taking into account the criteria described below.

In selecting peers, the Governance and Human Capital Committee considers the following key criteria:

Key Criteria When Identifying Peer Group Companies

In February 2023, in consultation with Mercer, the Governance and Human Capital Committee conducted its regular review and assessment of our existing peer group, including consideration of new peers that align with our peer selection criteria, particularly as the Company continues to grow. Following this review, the Governance and Human Capital Committee determined the composition of our compensation peer group for 2023. Alleghany Corporation was removed following its acquisition by Berkshire Hathaway Inc. in 2022, and American Financial Group, Enstar Group Limited, The Hanover Insurance Group, Inc., and Selective

Insurance Group, Inc. were added as it was determined that they aligned with the Company’s selection criteria, in particular due to their size, position in the industry, and general peer alignment and overlap. The following twelve companies comprised our compensation peer group for 2023:

Due to industry consolidation, the number of standalone publicly traded companies that meet the above criteria has decreased over the past several years. Nevertheless, we believe this is still a carefully considered peer group comprised of companies that we compete with for business, executive talent or both. We also monitor the compensation practices of other non-traditional entrants into our industry with which we compete for talent to inform our compensation program design and determinations.

As discussed below under “Principal Components of our Executive Compensation Program,” in addition to our compensation peer group, we also have peer groups against which we measure certain performance metrics for annual incentive bonuses and performance shares.

Management and the Governance and Human Capital Committee balance the goal of aligning the interests of our executives and employees with the long-term interests of shareholders with active monitoring of our equity-based grant practices and potential for shareholder dilution. In determining 2023 equity-based grants, including the 2023 performance recognition awards, the Governance and Human Capital Committee and the Board considered our prior equity grant practices, currently outstanding equity awards, and the impact on shareholder dilution of these instruments and of contemplated grants. We periodically analyze the impact of our equity-based grants on dilution and share plan utilization models used by our institutional shareholders and by third parties who issue proxy voting recommendations.

Base salaries provide a fixed component of compensation at a competitive level to attract and retain executives. Salaries for our named executive officers are based on several factors, including the scope of job responsibilities, experience, expertise, performance and competitive market compensation. From time to time, salaries may be adjusted to reflect promotions, increases in responsibilities and competitive considerations. In 2023, Mr. Qutub and Mr. Marra received 3.8% and 3.7% salary increases, respectively, to align further with the competitive market as supported by competitive practices data provided by our independent compensation consultant. Ms. Bender’s salary was increased 20% over the course of 2023 to reflect her increased responsibilities and the competitive market.

Our annual incentive bonus contributes to the alignment of compensation and corporate performance for our named executive officers and other employees. Amounts are earned based on our attainment of both financial measures and quantitative and qualitative strategic and operating accomplishments, representing a form of variable pay. The Governance and Human Capital Committee and management believe that quantitative results should be the primary, but not the sole, measure of executive performance. This is because our business is subject to significant volatility over the short- and intermediate-term due to our exposure to catastrophic events, which makes it difficult to evaluate performance purely on a quantitative basis. This mix of qualitative and quantitative objectives is chosen to encourage underwriting discipline and to discourage excessive or inappropriate risk taking. The objectives also emphasize the investment of time and resources in projects to increase scalability and efficiency that will benefit shareholders over the long term. When considered together with the other components of our program that utilize different performance metrics and time frames, we believe this mix helps ensure that short-term corporate performance is not pursued at the expense of long-term shareholder value creation.

We believe that our performance-based annual incentive bonus process fosters relative internal pay equity and aligns employees with overall corporate results in a manner consistent with our team-based compensation philosophy and organizational culture.

At the beginning of each year, in connection with its annual compensation review, the Governance and Human Capital Committee determines a target level for each named executive officer’s annual incentive bonus. At the same time, the Governance and Human Capital Committee selects and approves the financial performance metrics and strategic accomplishments that will be used to determine the ultimate amount of the annual incentive bonus. This includes establishing specific targets, thresholds and maximums for each of the performance metrics.

Following year end, the Governance and Human Capital Committee measures our performance against the approved financial metrics and strategic accomplishments to determine a “business performance factor.” The business performance factor is equal to the sum of the outcomes for each performance metric, calculated as the percentage achievement multiplied by its relative weight, and subject to a maximum. Bonus allocations for all employees, including our named executive officers, are then made from a pool funded by multiplying the aggregate target bonuses by the business performance factor after adjusting for individual performance and contributions.

The target levels, as a percentage of base salary, for Messrs. O’Donnell, Qutub, Curtis and Branagan’s 2023 annual incentive bonuses were the same as the 2022 levels. Mr. Marra’s and Ms. Bender’s targets were increased to reflect their increased responsibilities and promotions, and to bring their target levels in line with the other members of the management governance committee as well as the competitive market.

These amounts were determined by the Governance and Human Capital Committee based on its annual analysis of the competitiveness of our executive compensation program, which is conducted with the assistance of Mercer. The Governance and Human Capital Committee believes these amounts reflect our competitive position in the industry and support our goal of having a significant portion of our named executive officer pay be at-risk.

For 2023, the Governance and Human Capital Committee approved a mix of financial performance metrics and strategic accomplishments in its annual incentive bonus determinations, as set forth below. The Governance and Human Capital Committee believes that each financial performance metric represents an important measure of the financial success of our business, and, together with the strategic accomplishments, serve to balance risk and reward and drive achievement of our strategic goals.

The performance metrics approved by the Governance and Human Capital Committee for 2023 are set forth below. The financial performance metrics were the same as those used in the 2022 program.

 

Our achievements against the strategic accomplishments (33.3%) approved by the Board for 2023 included:

 

To determine relative operating return on average common equity and combined ratio rank relative to our peers for purposes of determining the payout of our annual incentive bonus for 2023, the Governance and Human Capital Committee, in consultation with Mercer and management, selected an expanded group of peers that included nine of the companies in our compensation peer group, plus eight additional companies. Subsequent to selecting the annual incentive bonus peer group, Argo Group International Holdings, Ltd. was acquired in 2023 and was removed from the annual incentive bonus peer group, and the Governance and Human Capital Committee determined that data for five of the European peers would not be available due to accounting changes relating to the timing of recognition of contracts under International Financial Reporting Standard 17, Insurance Contracts (“IFRS 17”) rather than on a GAAP basis, and those five were removed from the peer group. The following 11 companies comprised our annual incentive bonus peer group for 2023:

Full details of the specific targets, thresholds and maximums for each metric, as well as the actual results for 2023, are set forth in the graphic below. For each performance metric, an actual result below the set threshold would result in no payout related to that metric.

 

In February 2024, the Governance and Human Capital Committee reviewed the Company’s performance for the 2023 fiscal year and the payout formula for determining the business performance factor. Performance against financial metrics is calculated formulaically based on actual results and the Governance and Human Capital Committee determined that it would not exercise discretion to reduce the payout determination. To determine performance against strategic accomplishments, the Governance and Human Capital Committee reviews detailed information provided by management regarding progress on each of the various pre-established goals and consults with the Audit Committee, the Investment and Risk Management Committee, and the Non-Executive Chair of the Board, then gives a score to each area and averages the results to determine a final “strategic projects score” that corresponds to a pre-established payout percentage. The Governance and Human Capital Committee believes that, as discussed above under “Link Between Pay and Performance for 2023,” the Company performed very well against the pre-established strategic accomplishments for the annual incentive bonuses for 2023.

Based on our actual performance achievements, the Governance and Human Capital Committee established an overall business performance factor of 182% of target for 2023 (in accordance with the formula described above) and determined that the actual annual incentive bonus for 2023 for each named executive officer would be equal to our business performance factor of 182%, multiplied by his target bonus amount.

The target and actual annual incentive bonuses for 2023 for each of our named executive officers, as determined by the Governance and Human Capital Committee, are set forth in the table below:

The Governance and Human Capital Committee and senior management monitor the Company’s equity grant practices to evaluate whether such policies comply with governing regulations and are consistent with good corporate practices. Generally, the Governance and Human Capital Committee makes annual long-term incentive awards to the named executive officers in connection with its annual review of compensation in the first quarter of the year, after results for the preceding fiscal year become available and after review and evaluation of each executive officer’s performance, enabling the Governance and Human Capital Committee to consider both the prior year’s performance and expectations for the succeeding year in making grant decisions. The annual grants have historically had an effective date of March 1 of each year. The Governance and Human Capital Committee may also grant equity awards from time to time to reflect promotions, special achievements, new hires or retention needs.

Time-vested restricted shares generally vest in four equal annual installments subject to continued service with the Company. Performance share awards generally have a three-year performance period, and cliff vest at the end of a three-year service period.

The Governance and Human Capital Committee reviews the terms and conditions of our performance shares at least annually to assess alignment with our strategic plan. It selects the performance metric or metrics that will be used, and sets specific targets, thresholds and maximums.

Dividends are generally payable currently with respect to time-vested restricted shares. Dividends are accrued on unvested performance shares and are paid without interest at the same time as the underlying shares vest. No dividends are paid on forfeited performance shares.

In 2023, the Governance and Human Capital Committee granted each named executive officer an annual long-term incentive award. The award was split evenly between performance shares and restricted shares for all named executive officers.

The total target values and composition of the annual long-term incentive awards made in 2023 were based on the named executive officers’ responsibilities, performance and contributions during the previous year. The total target value of Mr. O’Donnell’s award was consistent with the prior year, and Mr. Marra’s total target value decreased slightly from 2022. The total target values of the awards for other named executive officers increased from the prior year to reflect their strong execution of our strategy and our success against our previously established goals. For Ms. Bender, her target value was also increased to bring her target levels in line with the other members of the management governance committee and to reflect her increased responsibilities following her promotion. In addition, consistent with other members of the management governance committee, Mr. Marra and Ms. Bender received 50% of their awards in the form of performance shares. Their previous annual awards were time-vested restricted shares only. The majority of the increases in total direct compensation in 2023 were delivered through these long-term incentive awards, reflecting our desire to align our executives with the long-term interests of our shareholders and incentivize multi-year retention.

The annual long-term incentive awards granted to our named executive officers in 2023 are set forth in the following table:

In 2023, the Governance and Human Capital Committee granted annual performance share awards with the same terms and metrics as the awards it granted in 2022, which include a three-year performance period and two performance metrics. The Governance and Human Capital Committee believes these terms and metrics continue to align with the Company’s current business, risk and investment portfolios.

In addition, consistent with the 2022 performance share awards, the maximum payout for the 2023 performance share awards is 200% for all named executive officers. The performance metrics and corresponding vesting levels for the 2023 performance share awards are set forth in the following table:

If performance falls between threshold and target or between target and maximum, vesting level (as a percent of target) is determined using linear interpolation. The Governance and Human Capital Committee has the authority to consider downward adjustments in conjunction with any vesting of performance shares but may not make any upward adjustments.

To determine average underwriting expense ratio rank relative to our peers for the purposes of payout of our performance shares granted in 2023, the Governance and Human Capital Committee, in consultation with Mercer and management, selected an expanded group of peers that included nine of the companies in our compensation peer group, plus eight additional companies. The following 17 companies comprised our performance share peer group for 2023 awards:

In February 2024, the Governance and Human Capital Committee reviewed and confirmed the results of the pre-approved formula for the average change in book value per common share and three-year average underwriting expense ratio rank compared to peers for the 2021 to 2023 performance cycle, for purposes of determining the vesting amount for the performance shares granted to the named executive officers in 2021.

The following table illustrates actual performance achieved and shares earned for performance shares granted in 2021 across the three-year performance cycle, which resulted in an overall payout of 190% of target.

Following the successful acquisition of Validus in November 2023, the Governance and Human Capital Committee considered a number of ways to structure an incentive compensation award that would serve as an effective way to incentivize significant outperformance and drive the Company’s strategic direction and value creation over the long-term and retain Mr. O’Donnell and members of our senior leadership team during a pivotal period for the Company’s long-term growth strategy.

The Governance and Human Capital Committee has not historically utilized one-time awards, and recognizes that they are not routine and should only be used in extraordinary circumstances. The Governance and Human Capital Committee considered the transformational acquisition of Validus an extraordinary circumstance for the Company, which was achieved due to Mr. O’Donnell’s integral involvement, and consulted with its independent compensation consultant, Mercer, in order to structure an incentive that it believed would be in the best interests of shareholders, while appropriately recognizing our Chief Executive Officer for his tremendous efforts in securing the acquisition for the Company and retaining him during this pivotal period.

Following its deliberations, on November 7, 2023, the Governance and Human Capital Committee granted a performance recognition award to Mr. O’Donnell in the form of a performance share award and a restricted share award. The Governance and Human Capital Committee considered the input of its independent compensation consultant when determining the structure and terms of the awards. Specifically, the performance recognition award was viewed as an effective way to:

The performance recognition award is structured with rigorous targets and delivered entirely in equity incentives, rather than a cash bonus to align Mr. O’Donnell’s interests more closely with the Company and share performance, particularly over the long-term.

Mr. O’Donnell’s 2023 performance recognition award has an aggregate target value on the grant date equal to $12,000,000. Mr. O’Donnell will only earn this target value based on the achievement of the performance metrics and objectives as outlined below, and any portion of the award that is not earned will be forfeited.

The length and structure of these awards were thoughtfully designed to be distinct from our annual plan and to drive strong outcomes for shareholders:

60% of the Chief Executive Officer performance recognition award was made in the form of performance shares, with vesting tied to the Company’s average change in tangible book value per share plus change in accumulated dividends over a four-year performance period (January 1, 2023 to December 31, 2026), with the potential to earn between 0% and 200% of the target number of shares based on performance against the pre-established performance goals, as shown in the table below. Because the award was granted with a particular focus on integrating Validus, the Governance and Human Capital Committee chose to assess performance based on tangible book value per share plus change in accumulated dividends rather than the book value per share metric used in the current program. The Governance and Human Capital Committee believes that this allows for a better evaluation of the success of integrating the acquisition, and better incentivizes organic growth.

To incentivize stretch performance, the threshold and target goals require performance at higher standards compared to the Company’s annual performance share awards. In addition, the Governance and Human Capital Committee structured the award to have an extended four-year performance period, compared to the Company’s typical three-year performance period. The extended period requires sustained, stretch performance over a longer period of time that better aligns with the anticipated Validus integration period, and to encourage retention over the relevant reinsurance cycle and strategic plan period.

Consistent with past practices, in light of the use of restricted shares rather than restricted share units, Mr. O’Donnell was granted the maximum number of shares that he could earn pursuant to the award, but any shares that are not earned will not vest and will be forfeited.

The remaining 40% of Mr. O’Donnell’s performance recognition award was made in the form of restricted shares with vesting tied to Mr. O’Donnell’s execution of certain management-related performance objectives over a five-year performance period (November 7, 2023 to November 15, 2028). 50% of the award is eligible for vesting on November 15, 2027 and the remaining 50% is eligible for vesting on November 15, 2028, subject to vesting in the event of certain terminations of employment in accordance with the terms of Mr. O’Donnell’s employment agreement.

Vesting is dependent on the achievement of the management-related performance objectives, which will be evaluated based on goals that are viewed as foundational for the long-term success of the business, including maximizing the potential value that the Validus acquisition brings to shareholders through successful integration, Mr. O’Donnell’s leadership in bringing together our two businesses and accelerating the Company’s long-term strategy, and Mr. O’Donnell’s development of talent, including new Validus employees, and long-term succession planning.

The performance recognition awards granted to Mr. O’Donnell in 2023 are set forth in the following table:

In addition, after considering the input of its independent compensation consultant, on November 7, 2023, the Governance and Human Capital Committee awarded 2023 performance recognition awards in the form of additional performance shares to each of the other continuing named executive officers. The aggregate grant date fair value for their awards, assuming target performance, was $750,000 each. These awards were granted in recognition of each award recipient’s performance relating to the Validus acquisition and to incentivize the successful integration of Validus. These awards have a three-year performance period from January 1, 2024 through December 31, 2026, and the same performance metrics and vesting levels as the annual 2023 performance share grants.

The performance recognition awards granted to our other continuing named executive officers in 2023 are set forth in the following table:

Mr. O’Donnell, Mr. Qutub, and Ms. Bender, our Bermuda-based, expatriate named executive officers, participate in a perquisite and benefit program that we believe furthers our goal of attracting and retaining key talent to our strategic Bermuda headquarters. Given the unique challenges of the Bermuda market, including travel to and from the island and the cost of living and maintaining a residence, we provide benefits and perquisites, such as personal travel and housing allowances and travel expenses to executive physicals, that are consistent with our competitors operating in this market and which we believe are necessary for recruitment and retention purposes. See “Housing Arrangements with Executive Officers” above for additional information.

Our named executive officers are also permitted Company-funded personal use of the corporate aircraft with a value up to the aggregate incremental cost to the Company of $85,000 per year. The aggregate incremental cost of the use of the corporate aircraft is calculated as the fully loaded variable rate of such aircraft. The named executive officers may also invite family members or other guests to fly on already scheduled corporate aircraft business trips, for which there is no incremental cost to us. Since 2020, in light

of concerns for safety, including among other reasons, the COVID-19 pandemic, and continuing commercial travel limitations in Bermuda, the Governance and Human Capital Committee adopted a policy allowing our management governance committee members additional Company-funded personal use of our NetJets program. See “Use of Company Aircraft” above for additional information. In addition, Mr. O'Donnell and Ms. Bender are entitled to the value of four and two commercial airline trips per year, respectively, for themselves and each member of their immediate families.

We do not pay tax gross-ups on perquisites for our named executive officers. Our named executive officers pay imputed income tax on the value of these benefits.

Our named executive officers may be entitled to vesting of equity-based incentive awards and other severance payments and benefits pursuant to the terms of our equity compensation plans and their employment agreements, and upon a qualifying termination of employment or a change in control. The Governance and Human Capital Committee views post-termination payments primarily as consideration for restrictive covenants applicable to our executives following termination of employment, which we believe are essential to the protection of our business given the specialized markets in which we compete. In addition, the Governance and Human Capital Committee believes that both the change in control and post-termination payments and benefits are necessary components of a competitive compensation program.

On September 1, 2023, Mr. Branagan, our former Group Chief Risk Officer and Executive Vice President, departed the Company following a period of compassionate leave and became entitled to receive severance benefits for a termination without cause under the terms of his employment agreement. In connection with his termination, Mr. Branagan entered into a separation agreement with the Company under which he became eligible to receive contractual severance benefits under the terms of his pre-existing employment agreement, with certain of those contractual severance benefits previously having been pre-paid.

The benefits payable upon a qualifying termination of employment or a change in control, as well as the benefits received by Mr. Branagan in connection with his 2023 separation, are described in detail under “Potential Payments Upon Termination or Change in Control” below.

We have adopted a recoupment policy (“Clawback Policy”) to comply with the NYSE listing standards implementing the compensation recovery requirements under the Dodd-Frank Wall Street Reform and Consumer Protection Act. The Clawback Policy requires the Governance and Human Capital Committee to recoup certain cash and equity incentive compensation paid or granted to certain current and former executives officers in the event the Company is required to prepare an accounting restatement due to material noncompliance with any financial reporting requirement under the federal securities laws. Under the policy, the Governance and Human Capital Committee will require recoupment if it determines that incentive-based compensation received by an executive exceeded the amount of incentive-based compensation that otherwise would have been received, had it been calculated based on the restated financial results.

If our Board were to determine that an executive officer engaged in fraudulent or intentional misconduct, the Board would impose appropriate discipline, including possibly terminating the executive officer’s employment and/or initiating an action for breach of fiduciary duty. These remedies as well as recoupment under the Clawback Policy would be in addition to any actions that might be imposed by law enforcement agencies, regulators or other authorities. We also have a right to set off against certain amounts owing to the executive officers should they engage in certain activities that are detrimental to the Company.

In addition to the Clawback Policy, Mr. O’Donnell’s employment agreement provides that incentive compensation (including both cash bonuses and equity awards) that is determined to have been earned based upon financial statements that were subsequently restated may be clawed back, or forfeited if unpaid, to the extent that such compensation would not have been earned based upon the restated financials. If the restatement is determined to have been due to Mr. O’Donnell’s misconduct, the clawback would apply to compensation paid within 60 months following our first filing with the SEC containing the financial statement that was restated. Except as otherwise required pursuant to the Clawback Policy, for restatements not determined to have been due to Mr. O’Donnell’s misconduct, our clawback rights under Mr. O’Donnell’s employment agreement apply only to compensation paid within 24 months following the first SEC filing containing the financial statement that was restated. In addition, our clawback rights under Mr. O’Donnell’s employment agreement apply to gains realized on sales of our securities in the 12 months following the first SEC filing containing a financial statement that is ultimately restated due to Mr. O’Donnell’s misconduct.

The Governance and Human Capital Committee evaluates the relationship between our executive and firm-wide compensation programs and policies and risk management on an annual basis. As discussed in this Compensation Discussion and Analysis, we design our compensation programs to incorporate a range of components that we believe help to mitigate potential risks while rewarding employees for pursuing our strategic and financial objectives through appropriate risk taking, risk management and prudent tactical and strategic decision making. The Governance and Human Capital Committee reviews the programs and policies on a regular basis in an effort to eliminate or mitigate potential risks arising from such programs and policies. In light of the market cycles and earnings volatility that characterize our industry, our efforts to align the interests of our executives and employees with the long-term interests of our shareholders and to assess whether our compensation structure, elements and incentives are reasonably likely to have a material adverse effect on the Company are ongoing. Senior executives representing our risk, legal and compliance, human resources, finance and internal audit functions, as well as the Governance and Human Capital Committee’s independent compensation consultant, are involved in this review process, which is conducted under the oversight of the Governance and Human Capital Committee. This process includes annual, individual executive sessions with the Group Chief Risk Officer, Chief Accounting Officer, Group General Counsel, Head of Internal Audit and Chief Human Resources Officer in advance of the establishment of compensation metrics for the coming year. Based on this review, we do not believe that there are any risks arising from our compensation policies and practices for our employees that are reasonably likely to have a material adverse effect on us.

For additional information regarding our risk management practices, see “Risk Oversight” above.

Our named executive officers are subject to equity ownership guidelines. In keeping with our overall compensation philosophy, we believe that the equity ownership levels that they are required to maintain are high enough to assure our shareholders of our executives’ commitment to long-term value creation. Under our guidelines, our named executive officers are required to maintain ownership of our equity with a value equal to a multiple of salary as follows:

Equity ownership value is calculated by adding the value of common shares owned outright, time-vested restricted shares, and performance shares calculated at target achievement. A named executive officer is not required to purchase shares in the open market in order to satisfy their ownership requirements but is prohibited from selling any of the equity granted to them, other than automatic dispositions for tax withholding, until ownership requirements are satisfied.

As of December 31, 2023, all of our named executive officers had satisfied their ownership requirements, other than Ms. Bender who did not join the Company until January 2021. However, Ms. Bender is in compliance with our guidelines because she is not required to purchase shares in the open market in order to satisfy her ownership requirements.

Our employees, including our named executive officers, are subject to our insider trading policies and practices, which prohibit:

It is the Board’s view that such activities are generally against the interest of our shareholders and could cause significant repercussions to us and our shareholders if allowed.

We believe that each of our named executive officers is in compliance with our anti-pledging, anti-hedging and other trading policies.

The information contained in this report shall not be deemed to be “soliciting material” or to be “filed” with the Commission, nor shall such information or report be incorporated by reference into any future filing by us under the Securities Act, or the Exchange Act, except to the extent that we specifically incorporate it by reference in such filing.

We have reviewed and discussed with management the disclosure set forth under the heading “Compensation Discussion and Analysis” in this proxy statement. Based on these reviews and discussions, we recommended to the Board that the Compensation Discussion and Analysis be included in this proxy statement and the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2023. This report is provided by the following independent directors, who constitute the Governance and Human Capital Committee:

Henry Klehm III, Chair

David C. Bushnell

Cynthia Trudell

The table below sets forth compensation for our named executive officers in fiscal years 2023 and, to the extent required by SEC disclosure rules, fiscal years 2022 and 2021. For certain of our continuing named executive officers, the total compensation reported for fiscal year 2023 increased as compared to fiscal years 2022 and 2021 partially due to the inclusion of the 2023 performance recognition awards, as described in the “Compensation Discussion and Analysis” section. In accordance with SEC disclosure rules, the value associated with the 2023 performance recognition awards is presented as fiscal year 2023 compensation and represents the full grant date fair value of the awards, even though such grants remain subject to vesting conditions and Mr. O’Donnell’s 2023 performance recognition awards are not scheduled to fully vest until November 15, 2028, and the 2023 performance recognition awards for the other continuing named executive officers are not scheduled to vest until December 31, 2026.