DEF: Abbott Laboratories Outlines Director Nominees, Executive Compensation, and Corporate Governance Practices in 2025 Proxy Statement

• Abbott Laboratories has released its proxy statement for the 2025 Annual Meeting of Shareholders, scheduled for April 25, 2025.
• The document outlines key items for shareholder voting, including the election of 12 director nominees, ratification of Ernst & Young LLP as auditors, and an advisory vote on executive compensation.
• Abbott emphasizes its diversified business model, which has delivered total shareholder return (TSR) above the peer group median on both a one-year (58th percentile) and five-year basis (68th percentile).
• The company returned $5.1 billion to shareholders in 2024 and announced a 7.3% increase to its dividend for 2025, marking the 53rd consecutive year of dividend increases.
• The proxy statement details Abbotts executive compensation program, linking pay to performance against operating and financial plans, strategic business priorities, and human capital metrics.
• Abbott's Board of Directors consists of highly qualified individuals with diverse backgrounds, skills, and experiences, ensuring strong oversight and guidance.
• The company is committed to sustainability, integrating environmental, social, and governance practices into its business strategy.
• Abbott's 2030 Sustainability Plan focuses on innovating for access and affordability, transforming care for chronic diseases, protecting the environment, building a diverse workforce, and ensuring a responsible supply chain.
• The document also includes information on corporate governance matters, director compensation, security ownership, and related person transactions.

Score: 8

Explanation: The document presents a positive outlook for Abbott, highlighting strong financial performance, a commitment to sustainability, and effective corporate governance. While acknowledging some challenges, the overall tone is optimistic and confident.

• Abbott's strong TSR performance indicates effective management and value creation for shareholders.
• The consistent dividend increases demonstrate a commitment to returning capital to shareholders.
• The addition of new independent directors enhances board diversity and expertise.
• The focus on sustainability and the 2030 Sustainability Plan demonstrate a commitment to long-term responsible business practices.
• High shareholder support for executive compensation suggests alignment between pay and performance.
• The company's robust innovation pipeline and investments in manufacturing scale and capabilities position it for future growth.

• Abbott's three-year TSR performance was negatively impacted by the decline in COVID test sales as the pandemic shifted to an endemic state.
• The document notes that an over-reliance on one fixed time-frame TSR measurement does not represent a complete picture of company performance.

• The proxy statement mentions risks and uncertainties that may cause actual results to differ materially from forward-looking statements, as detailed in Abbott's Annual Report on Form 10-K.
• The document highlights the importance of managing enterprise risks, such as those related to cybersecurity, data protection, product quality, and regulatory compliance.

Abbott aims to continue delivering long-term impact for the people it serves, shaping the future of healthcare and helping the greatest number of people live better and healthier lives, with a goal to reach 3 billion people a year by 2030.

• Abbott is committed to strong corporate governance that is aligned with shareholder interests.
• The Board spends significant time with Abbott's senior management to understand the dynamics, issues, and opportunities for Abbott.
• The Board regularly monitors leading practices in governance and adopts measures that it determines are in the best interest of Abbott and its shareholders.

The document positions Abbott as a leader in the healthcare industry, highlighting its diversified business model and innovative product portfolios. It also emphasizes the importance of sustainability and responsible business practices, aligning with broader industry trends.

• Abbott benchmarks its compensation and benefit programs against a peer group of companies with similar size, growth, return profiles, geographic breadth, and management structure, including 3M Company, Johnson & Johnson, Medtronic, and Pfizer.
• The company's TSR performance is compared to the S&P 500 Health Care Index.
• Abbott's commitment to sustainability is aligned with the Science Based Targets initiative (SBTi) objective of reducing Scope 1, 2, and 3 carbon emissions.

• The company's strong financial performance and commitment to sustainability benefit shareholders, employees, customers, and the broader community.
• The focus on access and affordability in healthcare aims to improve the lives of patients and expand access to care.
• The company's efforts to build a diverse and innovative workforce create opportunities for employees and contribute to a more inclusive society.

• Shareholders are encouraged to vote on the proposals outlined in the proxy statement.
• The company will hold its Annual Meeting of Shareholders on April 25, 2025.
• Abbott will continue to monitor and adapt its corporate governance practices, executive compensation program, and sustainability initiatives.

• In accordance with Abbotts articles of incorporation, Abbott has advanced defense costs on behalf of the Board of Directors and certain officers and employees in connection with a derivative action regarding Abbotts manufacturing of certain infant powder formula products.

• In 2024, an Abbott employee became the son-in-law of one of Abbotts directors, Sally E. Blount, Ph.D. During 2024, his total compensation exceeded the threshold requiring review by the Nominations and Governance Committee.

• 2004: Participants hired prior to 2004 are eligible for early retirement at age 50 with 10 years of service or age 55 if the employee's age plus years of benefit service total 70 or more.
• 2008: Officers elected after 2008 may only have the vested plan benefits that accrue following the calendar year in which the officer is first elected funded through a grantor trust.
• 2009: Officers elected prior to 2009 may have the entire amount of their vested plan benefits funded through a grantor trust.
• 2014: Ernst & Young LLP has served as Abbotts auditors since 2014.
• 2018: Since 2018, Abbott has added six new independent directors, including three women and three minorities, enhancing board diversity.
• December 31, 2019: Comparison assumes $100 was invested on December 31, 2019 in our common stock.
• March 31, 2020: Mr. Ford served as President and Chief Operating Officer until his appointment to President and Chief Executive Officer (PEO), effective March 31, 2020.
• September 2022: Our Scopes 1, 2, and 3 targets were approved by the Science Based Targets initiative (SBTi) in September 2022.
• 2023: Abbott adopted a Dodd-Frank compliant clawback policy in 2023.
• October 2024: In October 2024, the Audit Committee appointed Ernst & Young LLP to act as auditors for 2025.
• January 31, 2025: Share ownership information is reported as of January 31, 2025.
• February 26, 2025: Shareholders of record at the close of business on February 26, 2025 will be entitled to notice of and to vote at the Annual Meeting.
• March 14, 2025: This proxy statement and the accompanying proxy card, and the Notice of Internet Availability of Proxy Materials, are being provided to shareholders on or about March 14, 2025.
• April 22, 2025: Registration requests to attend the Annual Meeting must be received by Computershare no later than 5 p.m. Eastern Time on Tuesday, April 22, 2025.
• April 25, 2025: The 2025 Annual Meeting of Shareholders will be held on Friday, April 25, 2025 at 9:00 a.m. Central Time.
• November 14, 2025: Shareholder proposals for presentation at the 2026 Annual Meeting must be received by Abbott no later than November 14, 2025.
• January 25, 2026: To be timely for the 2026 Annual Meeting, written notice to directly nominate persons for director, including through proxy access, or to bring business properly before the Annual Meeting must be received by Abbott no later than the close of business on January 25, 2026.
• December 31, 2026: Each change in control agreement continues in effect until December 31, 2026, and can be renewed for successive two-year terms upon notice prior to the expiration date.