Cna Financial Corp PRE 14A, filed Mar 12, 2024

Cna Financial Corp (CNA)

PRE 14A 2024-03-12 For: 2024-05-01

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Proposals				Board Vote Recommendation
1. Election to the Board of Directors of the ten nominees named in the proxy statement				FOR each director nominee
2. An advisory (non-binding) vote to approve named executive officer compensation				FOR
3. Approval of an amendment to CNA’s certificate of incorporation to update the exculpation provision				FOR
4. Ratification of the appointment of Deloitte & Touche LLP as independent registered public accountants for CNA for 2024				FOR

	MEETING DETAILS					1
	PROXY SUMMARY					4
	STOCK OWNERSHIP OF THE COMPANY					6
	Principal Stockholder					6
	Director and Officer Holdings					6
	CORPORATE GOVERNANCE PROPOSAL 1. Election of 10 Directors					8
	Director Nominees’ Biographical Information and Business Experience					8
	Director Independence					10
	Leadership Structure					11
	Board Oversight of Risk Management					11
	Committees and Meetings					12
	Audit Committee					12
	Compensation Committee					12
	Code of Business Conduct and Ethics					13
	Meetings					13
	Audit Committee Report					13
	Director Compensation					14
	Related Party Transactions					15
	ENVIRONMENTAL, SOCIAL AND GOVERNANCE (ESG) GOVERNANCE FRAMEWORK					16
	EXECUTIVE COMPENSATION PROPOSAL 2. An advisory (non-binding) vote to approve named executive officer compensation					17
	Compensation Discussion and Analysis (CD&A)					17
	Comparative Market Data					25
	Compensation Consultant					26
	Clawback Policy and Other Compensation Policies, including with respect to hedging activities					26
	Compensation Committee Report on Executive Compensation					27
	Non-Binding Stockholder Vote on 2022 Executive Compensation					27
	Non-Binding Stockholder Vote on 2023 Executive Compensation					27
	Compensation of Executive Officers					28
	2023 Pay Ratio Disclosure					34
	Pay Versus Performance					34
	PROPOSAL 3. Approval of an amendment to CNA’s certificate of incorporation to update the exculpation provision					38
	PROPOSAL 4. Ratification of Deloitte & Touche LLP as Independent Registered Public Accountants For CNA For 2024					39
	OTHER MATTERS					39
	Stockholder and Other Interested Party Communications to the Board of Directors or the Independent Directors					40
	Stockholder Proposals for the 2025 Annual Meeting					40

	Proposal 2			See Page
	An advisory (non-binding) vote to approve named executive officer compensation This proposal gives you as a stockholder the opportunity to endorse or not endorse our executive pay practices with respect to the named executive officers. This vote is intended to provide an overall assessment of our executive compensation program and is not intended to focus on any specific item of compensation. You should consider the details of our executive compensation program provided in the “2023 Summary Compensation Table” and the tables and narrative discussion that follow it. This disclosure sets forth the factors considered in determining executive compensation packages, including market information utilized in implementing competitive compensation to attract top talent. The Board recommends a vote FOR this proposal.			17

	Proposal 3			See Page
	Approval of an amendment to CNA’s certificate of incorporation to update the exculpation provision We are requesting stockholders to approve an amendment to our certificate of incorporation to update the exculpation provision. The amendment allows the Company to restate the exculpation provision to extend coverage to certain senior officers to the extent permitted under amended Section 102(b)(7) of the Delaware General Corporation Law (the “DGCL”). Should the proposed amendment be approved, both directors and officers would be protected from monetary liability for fiduciary duty breaches to the extent allowed under the DGCL. The Board recommends a vote FOR this proposal.			38

	Proposal 4			See Page
	Ratification of the appointment of Deloitte & Touche LLP as independent registered public accountants for CNA for 2024 Our Audit Committee of our Board of Directors has selected Deloitte & Touche LLP to serve as the independent registered public accountants for 2024. Although it is not required to do so, our Board of Directors wishes to submit the selection of Deloitte & Touche LLP for ratification by the Company’s stockholders at the Annual Meeting. Even if this selection is ratified by stockholders at the Annual Meeting, our Audit Committee may in its discretion change the appointment at any time during the year if it determines that such a change would be in the best interests of the Company and its stockholders. If the Company’s stockholders do not ratify the selection of Deloitte & Touche LLP, the Audit Committee will reconsider its selection. Representatives of Deloitte & Touche LLP are expected to be at the Annual Meeting to answer appropriate questions and, if they choose to do so, to make a statement. The Board recommends a vote FOR this proposal.			39


	PLACE:
	151 N. Franklin Street, 7th Floor Navy Pier 3 Room, Chicago, Illinois

		Important Notice Regarding the Availability of Proxy Materials for the Annual Meeting of Stockholders to be held on May 1, 2024:
		The proxy statement and the 2023 Annual Report to Stockholders are posted on the Company’s website at www.cna.com.


	VOTE BY INTERNET (www.proxyvote.com )
	Use the Internet to transmit your voting instructions and for electronic delivery of information up until 11:59 p.m., Eastern time, the day before the meeting date.


	VOTE BY PHONE (1-800-690-6903)
	Use any touch-tone telephone to transmit your voting instructions up until 11:59 p.m., Eastern time, the day before the meeting date.


	VOTE BY MAIL
	Mark, sign and date your proxy card and return it in the postage-paid envelope we have provided or return it to Vote Processing, c/o Broadridge, 51 Mercedes Way, Edgewood, NY 11717 in time for receipt by Vote Processing before May 1, 2024.

	Proposal 1			See Page
	Election of Directors The persons named in this proxy statement as nominees for election as directors have been designated by the Board. Our director nominees identified below are current members of our Board of Directors. Pursuant to our bylaws, the number of directors constituting the full Board of Directors has been fixed at ten. Each director shall be elected at the Annual Meeting and shall hold office until the next Annual Meeting and until their successor is elected and qualified. Directors need not be stockholders of the Company.			8

Name:	Shares of CNA Common Stock Beneficially Owned		Shares of Loews Common Stock Beneficially Owned
Michael A. Bless		2,500		0
Daniel P. Franzetti		32,784(1)		0
Scott R. Lindquist		0		0
Jose O. Montemayor		0		0
Don M. Randel		0		0
André Rice		0		0
Dino E. Robusto		424,235(2)		0
Kenneth I. Siegel		0		13,315
Susan A. Stone		11,982(3)		0
Andrew H. Tisch		106,100		14,916,775(4)
Benjamin J. Tisch		0		370,246(5)
James S. Tisch		106,100		16,797,491(6)
Jane J. Wang		0		5,958
Douglas M. Worman		45,671(7)		0
All executive officers and directors as a group (21 persons)		838,568(8)		32,103,785(9)

Demographic Information of Directors	ROBUSTO	SIEGEL	A.TISCH	B.TISCH	J. TISCH	WANG	BLESS	MONTEMAYOR	RANDEL	RICE
Tenure (years)	8	5	18	6	39	5	7	17	22	7
Age	65	67	74	41	71	42	58	73	83	66
Gender	M	M	M	M	M	F	M	M	M	M
Race/Ethnicity
Asian/Other Pacific Islander
Black/African American
Hispanic/Latino
White/Caucasian

Name	Fees
Michael A. Bless		$	215,417
Jose O. Montemayor		$	230,417
Don M. Randel		$	210,417
André Rice		$	210,417
Andrew H. Tisch		$	118,417

		What We DO
					Compensation heavily weighted toward at-risk and performance-based variable pay (91% for CEO)
					Performance share awards subject to 3-year cliff vesting and financial performance metric that drives long-term stockholder value
					Maintain a clawback policy with respect to named executive officer compensation
					Periodic review of compensation peer group
					Target pay within a median market range of peer companies
					Maximum payout caps for annual incentive cash compensation and performance share awards
					Employment agreement with non-competition and non-solicitation terms for the Company’s CEO


	DATE:
	Wednesday, May 1, 2024


	TIME:
	7:30 a.m., Central time


	RECORD DATE:
	March 5, 2024

		What We DO NOT Do:
					No hedging transactions by the Company’s directors and executive officers
					No pledging Company securities by the Company’s directors and executive officers
					No payment of dividends or dividend equivalents on equity awards until vesting
					No tax “gross-up” payments on perquisites or other personal benefits for named executive officers
					No excessive or unusual perquisites
					No individual employment agreements for any executive officers, except for the Company’s CEO

2023 CI			2023 Company Performance as a Percentage of Target
Below Threshold			0%
Between Threshold and Target			50% – 99%
Target: $1.206 billion			100%
Above Target			101% – 200%

Name	Year		Annual Incentive Cash Awards
Dino E. Robusto		2023		$	7,500,000
Scott R. Lindquist		2023		$	1,870,000
Douglas M. Worman		2023		$	3,800,000
Daniel P. Franzetti		2023		$	1,870,000
Susan A. Stone		2023		$	1,300,000

Compensation Peer Group
The Allstate Corporation	American Financial Group, Inc.	Chubb Limited
Cincinnati Financial Corporation	The Hartford Financial Services Group, Inc.	Markel Corporation
The Progressive Corporation	The Travelers Companies, Inc.	W.R. Berkley Corporation

Name and Principal Position	Year		Salary (a)			Bonus (b)	Stock Awards (c)			Non-Equity Incentive Plan Compensation (d)			Change in Pension Value and Nonqualified Deferred Compensation Earnings (e)	All Other Compensation (f)			Total
Dino E. Robusto Chief Executive Officer CNA Financial Corporation		2023		$	1,250,000	—		$	5,499,991		$	7,500,000	—		$	1,834,221		$	16,084,212
		2022		$	1,250,000	—		$	5,499,992		$	6,750,000	—		$	1,568,397		$	15,068,389
		2021		$	1,250,000	—		$	5,499,990		$	6,000,000	—		$	1,496,217		$	14,246,207
Scott R. Lindquist EVP & Chief Financial Officer CNA Financial Corporation		2023		$	737,500	—		$	1,399,994		$	1,870,000	—		$	189,070		$	4,196,564
		2022		$	684,295	—		$	1,364,990		$	1,600,000	—		$	147,742		$	3,797,027
Douglas M. Worman EVP & Global Head of Underwriting CNA Insurance Companies		2023		$	937,500	—		$	2,474,985		$	3,800,000	—		$	731,614		$	7,944,099
		2022		$	900,000	—		$	2,474,999		$	3,520,000	—		$	461,808		$	7,356,807
		2021		$	811,250	—		$	1,999,992		$	2,750,000	—		$	324,159		$	5,885,401
Daniel P. Franzetti EVP & Chief Adminstrative Officer CNA Insurance Companies		2023		$	725,000	—		$	1,349,965		$	1,870,000	—		$	356,775		$	4,301,740
		2022		$	668,750	—		$	974,980		$	1,640,000	—		$	240,321		$	3,524,051
Susan A. Stone EVP & General Counsel CNA Financial Corporation		2023		$	695,000	—		$	1,019,989		$	1,300,000	—		$	191,273		$	3,206,262

Name	Year		Company Aircraft (a)			Dividend Equivalent Payments (b)			401(k) Plan and Deferred Compensation Savings Plan Contributions			Other (c)			Total
Dino E. Robusto		2023		$	195,659		$	1,163,563		$	475,000			—		$	1,834,221
Scott R. Lindquist		2023			—			—		$	161,125		$	27,946		$	189,070
Douglas M. Worman		2023			—		$	452,489		$	279,125			—		$	731,614
Daniel P. Franzetti		2023			—		$	175,629		$	161,750		$	19,396		$	356,775
Susan A. Stone		2023			—		$	48,947		$	139,950		$	2,376		$	191,273

Name	Type of Award	Grant Date		Estimated Future Payouts Under Non-Equity Incentive Plan Awards								Estimated Future Payouts Under Equity Incentive Plan Awards						Grant Date Fair Value of Stock Awards ($) (c)
Name	Type of Award	Grant Date		Threshold ($)		Target ($)			Maximum ($) (a)			Threshold (#)		Target (#)		Maximum (#) (b)		Grant Date Fair Value of Stock Awards ($) (c)
Dino E. Robusto	Performance Share Plan Award		3/15/2023		—			—			—		74,647		149,294		298,588		$	5,499,991
	Annual Cash				—		$	5,000,000		$	7,500,000		—		—		—			—
Scott R. Lindquist	Performance Share Plan Award		3/15/2023		—			—			—		19,001		38,002		76,004		$	1,399,994
	Annual Cash				—		$	1,125,000		$	2,250,000		—		—		—			—
Douglas M. Worman	Performance Share Plan Award		3/15/2023		—			—			—		33,591		67,182		134,364		$	2,474,985
	Annual Cash				—		$	2,137,500		$	4,275,000		—		—		—			—
Daniel P. Franzetti	Performance Share Plan Award		3/15/2023		—			—			—		18,322		36,644		73,288		$	1,349,965
	Annual Cash				—		$	1,125,000		$	2,250,000		—		—		—			—
Susan A. Stone	Performance Share Plan Award		3/15/2023		—			—			—		13,843		27,687		55,374		$	1,019,989
	Annual Cash				—		$	1,015,000		$	2,030,000		—		—		—			—

	Option/SARs Awards										Stock Awards
Name	Date of Grant		Number of Securities Underlying Unexercised Options/SARs (#)		Number of Securities Underlying Unexercised Options/SARs (#)		Equity Incentive Plan Awards: Number of Securities Underlying Unexercised Unearned Options/SARs (#)		Option/ SARs Exercise Price ($)		Option/ SARs Expiration Date		Number of Shares or Units of Stock That Have Not Vested (#)		Market Value of Shares or Units of Stock That Have Not Vested ($)				Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested (#)		Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested ($)
Name	Date of Grant		Exercisable		Unexercisable				Option/ SARs Exercise Price ($)		Option/ SARs Expiration Date		Number of Shares or Units of Stock That Have Not Vested (#)
Dino E. Robusto		3/15/2021		—		—		—		—		—		125,597		$	5,314,009	(a)		—		—
		3/15/2022		—		—		—		—		—		131,567		$	5,566,600	(b)		—		—
		3/15/2023		—		—		—		—		—		165,716		$	7,011,444	(c)		—		—
Scott R. Lindquist		3/15/2022		—		—		—		—		—		32,652		$	1,381,506	(b)		—		—
		3/15/2023		—		—		—		—		—		42,562		$	1,800,798	(c)		—		—
		—		—		—		—		—		—		—			—			—		—
Douglas M. Worman		3/15/2021		—		—		—		—		—		45,671		$	1,932,340	(a)		—		—
		3/15/2022		—		—		—		—		—		59,205		$	2,504,964	(b)		—		—
		3/15/2023		—		—		—		—		—		74,572		$	3,155,141	(c)		—		—
Daniel P. Franzetti		3/15/2021		—		—		—		—		—		21,408		$	905,772	(a)		—		—
		3/15/2022		—		—		—		—		—		23,322		$	986,754	(b)		—		—
		3/15/2023		—		—		—		—		—		40,674		$	1,720,917	(c)		—		—
Susan A. Stone		6/28/2021		—		—		—		—		—		11,982		$	506,958	(a)		—		—
		3/15/2022		—		—		—		—		—		24,399		$	1,032,322	(b)		—		—
		3/15/2023		—		—		—		—		—		30,732		$	1,300,271	(c)		—		—

Name	Executive Contributions in Last Fiscal Year (a)			Company Contributions in Last Fiscal Year			Aggregate Earnings in Last Fiscal Year			Aggregate Withdrawals / Distributions		Aggregate Balance at Last Fiscal Year-End
Dino E. Robusto		$	75,000		$	438,700		$	69,902		—		$	2,768,829
Scott R. Lindquist		$	1,168,750		$	125,313		$	247,772		—		$	1,758,761
Douglas M. Worman		$	56,250		$	242,825		$	27,830		—		$	1,144,993
Daniel P. Franzetti		$	207,500		$	125,756		$	57,748		—		$	729,898
Susan A. Stone		$	41,700		$	103,650		$	25,135		—		$	287,190

Benefit	Termination w/o Cause or for Good Reason			Retirement			Voluntary Termination		For Cause Termination		Death/Disability			Disability			Change in Control
Annual Incentive Cash Payment		$	7,500,000			—		—		—		$	7,500,000		$	7,500,000		—
Equity Awards(a)		$	17,892,053		$	17,892,053		—		—		$	17,892,053			—		—
Severance Related Payments(b)		$	6,250,000			—		—		—			—			—		—
Benefits and Perquisites(c)		$	943			—		—		—		$	943			—		—
Excise Tax and Gross-Up			—			—		—		—			—			—		—
Total Potential Payments		$	31,642,996		$	17,892,053		—		—		$	25,392,996		$	7,500,000		—

Year (a)	Summary Compensation Table Total for PEO (b)			Compensation Actually Paid to PEO (c)			Average Summary Compensation Table Total for Non-PEO NEOs (d)			Average Compensation Actually Paid to Non-PEO NEOs (e)			Value of Initial Fixed $100 Investment Based On:						Net Income (h)			CI (i)
Year (a)	Summary Compensation Table Total for PEO (b)			Compensation Actually Paid to PEO (c)						Average Compensation Actually Paid to Non-PEO NEOs (e)			Total Shareholder Return (f)			Peer Group Total Shareholder Return (g)			Net Income (h)			CI (i)
2023		$	16,084,212		$	17,516,540		$	4,912,166		$	5,374,060		$	125		$	169		$	1,205,000,000		$	1,312,000,000
2022		$	15,068,389		$	14,945,719		$	4,081,690		$	3,537,640		$	118		$	156		$	682,000,000		$	1,201,000,000
2021		$	14,246,207		$	16,180,923		$	3,571,966		$	3,965,857		$	113		$	130		$	1,184,000,000		$	1,083,000,000
2020		$	11,469,174		$	9,870,731		$	4,009,419		$	3,854,688		$	95		$	107		$	690,000,000		$	1,049,000,000

Year	Reported Summary Compensation Table Total for PEO (a)			Equity Award Adjustments (b)			Dividends not included in SCT		Change in PV of Defined Benefit or Pension Plan		Aggregate service costs for Defined Benefit or Pension Plan		“Compensation Actually Paid” to PEO
2023		$	16,084,212		$	1,432,327		—		—		—		$	17,516,540
2022		$	15,068,389		$	(122,670)		—		—		—		$	14,945,719
2021		$	14,246,207		$	1,934,716		—		—		—		$	16,180,923
2020		$	11,469,174		$	(1,598,443)		—		—		—		$	9,870,731

Year	Reported Average Summary Compensation Table Total for Non-PEO NEOs (a)			Equity Award Adjustments (b)			Dividends not included in SCT		Change in PV of Defined Benefit or Pension Plan		Aggregate service costs for Defined Benefit or Pension Plan		“Compensation Actually Paid” to Non-PEO NEOs
2023		$	4,912,166		$	461,893		—		—		—		$	5,374,060
2022		$	4,081,690		$	(544,050)		—		—		—		$	3,537,640
2021		$	3,571,966		$	393,891		—		—		—		$	3,965,857
2020		$	4,009,419		$	(154,731)		—		—		—		$	3,854,688

		CI
		Underlying Property & Casualty Combined Ratio
		Property & Casualty Underwriting Premium

	For year ended 2023	For year ended 2022
Audit Fees — The aggregate fees billed for the audit of the Company’s annual financial statements included in the Company’s Annual Report on Form 10-K, for consents and comfort letters, and for the reviews of the financial statements included in the Company’s Quarterly Reports on Form 10-Q	$12.8 million	$11.8 million
Audit-Related Fees — The aggregate fees billed for audit-related services which generally include fees for audits of the Company’s employee benefit plans, accounting consultations, SEC-related matters and an examination conducted in accordance with the Statement on Standards for Attestation Engagements No. 18 (SSAE 18).	$0.8 million	$0.5 million
Tax Fees	$0	$0
All Other Fees	$10.8 thousand	$11.0 thousand
Total of Audit and Audit-Related Fees (as described above)	$13.6 million	$12.3 million