Stifel Financial Corp DEF 14A, filed Apr 26, 2024

About this DEF 14A

Stifel Financial Corp (SF)

DEF 14A 2024-04-26 For: 2024-06-05

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Added on June 12, 2026

Overall Company Performance,

Committee Assessment

Stifel Financial Corp filed this DEF 14A on April 26, 2024.

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☐		Preliminary Proxy Statement

☐		Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))

☒		Definitive Proxy Statement

☐		Definitive Additional Materials

☐		Soliciting Material Pursuant to Rule 240.14a-12



☒		No fee required

☐		Fee paid previously with preliminary materials.

☐		Fee computed on table in exhibit required by Item 25(b) per Exchange Act Rules 14a-6(i)(1) and 0-11


LETTER FROM OUR CHAIRMAN & CEO			1
TABLE OF CONTENTS			2
NOTICE OF 2024 ANNUAL MEETING OF SHAREHOLDERS			3
Performance Highlights			4

Shareholders’ Say on Pay: Outreach and Shareholder Input			7

Corporate Responsibility: Environmental, Social and Governance			8

Corporate Governance Highlights			9

Diversity Is an Important Factor in Consideration of Potential and Incumbent Directors			11
ITEM 1. ELECTION OF DIRECTORS			12
Our Directors			12

Our Corporate Governance Principles			19

Committees of the Board of Directors			20

Other Governance Matters			22
COMPENSATION DISCUSSION & ANALYSIS			24
Committee Process and Determinations			24

Company Performance			26

Executive Compensation Determinations for 2023			31

2023 Compensation Determinations for Named Executive Officers			32

Key Pay Practices			36

Committee Commitments and Principles			36

Key Executive Compensation Program Elements			40

Pay Structure and Risk Mitigation			42

Summary Compensation Table Treatment of Timing of Compensation			47

Use of Non-GAAP Measures			47


Grants of Plan-Based Awards			49

Stock Unit Awards and Grant Date Fair Value under ASC 718			50

Additional Information about Compensation Paid to the Named Executive Officers			50

Outstanding Equity Awards at Fiscal Year-End			51

Option Exercises and Stock Units Vested or Converted			52

Post-Employment Payments Discussion			53

Non-Employee Director Compensation			54

Certain Relationships and Related Transactions			55

CEO Pay Ratio			56

Pay Versus Performance			56

Compensation Committee Report On Executive Compensation .			58
ITEM 2. AN ADVISORY VOTE TO APPROVE EXECUTIVE COMPENSATION (SAY ON PAY)			59
ITEM 3. RATIFICATION OF APPOINTMENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM			60
BENEFICIAL OWNERSHIP			62
Ownership of Directors and Executive Officers			62

Beneficial Owners with more than Five Percent of our common stock			63

Beneficial Ownership by Employees			63
QUESTIONS & ANSWERS ABOUT THE ANNUAL MEETING			64
OTHER MATTERS			67


TIME AND DATE:	Wednesday, June 5, 2024 at 9:30 a.m., Central Time

VIRTUAL-ONLY ACCESS:	The 2024 Annual Meeting of Shareholders will be virtual-only. Anyone may enter the meeting as a guest in listen-only mode, but only shareholders as of the record date and holders of valid proxies may attend and participate in the meeting, vote electronically and submit questions before and during the meeting by visiting www.meetnow.global/MT2N47N at the meeting date and time. If you plan to attend the virtual meeting, please refer to Questions & Answers about the Annual Meeting on page 64 for details.

ITEMS OF BUSINESS:		Board Recommendation	Page Reference
	u Election of Directors, each as nominated by the Board of Directors (the “Board”)	For	12
	u An advisory vote to approve executive compensation (Say on Pay)	For	59
	u Ratification of the appointment of Ernst & Young LLP as our independent registered public accounting firm for 2024	For	60
	u Transaction of such other business as may properly come before our 2024 Annual Meeting of Shareholders
RECORD DATE:	You are entitled to vote if you were a shareholder at the close of business on April 8, 2024
VOTING BY PROXY:	Your vote is very important. By April 26, 2024, we will have sent to certain of our shareholders a Notice of Internet Availability of Proxy Materials (Notice). The Notice includes instructions on how to access our Proxy Statement and 2023 Annual Report to Shareholders and vote online or by telephone, no later than the close of business on May 31, 2024. If you received a paper copy of the proxy card, you may mail your proxy vote in the provided envelope.



Institutional Shareholder Guidelines	Stifel Response	Cross-Reference

Incentive plans should reflect strategy and incorporate long-term shareholder value drivers, including metrics and timeframes.	Our Committee has developed a facts-based, performance-focused framework by which it assesses executive officer performance and sets compensation against clearly stated and measured Company and business goals. Our Performance-Based Restricted Stock Units (PRSUs) are primarily based on measuring objective, clearly stated performance goals.	Page 25, Incentive Assessment Framework Results Page 42, Performance-Based Restricted Stock Units, PRSUs

Performance results should generally be achieved over a 3- to 5-year time horizon.	PRSUs are measured over a 4-year period and vest over a 5-year period. Both periods are longer than is typical in the market, which we believe results in stronger retention.	Page 42, Performance-Based Restricted Stock Units, PRSUs

Peer group evaluation should be used to maintain awareness of pay levels and practices.	Our peer group was identified by Compensation Advisory Partners LLC (CAP), our independent compensation consultant. CAP provided the Committee with market data on executive compensation trends and executive officer compensation levels, and assisted the Committee with evaluation of pay-for-performance alignment.	Page 39, Independent Compensation Committee Consultant and Identification of Peer Group

Disclose the rationale behind the selection of pay vehicles and how these fit with intended incentives.	Our key executive compensation program elements include fixed and variable compensation, and we have disclosed the rationale behind the selection of pay vehicles and how they fit with intended incentives in detail in the sections referenced to the right.	Page 40, Key Executive Compensation Program Elements Page 41, Committee’s Perspective on Compensation Elements Page 31, Executive Compensation Determinations for 2023



Recent Environmental, Social, and Governance Programs and Efforts


$9 Million	$74 million	Good Homes	More Efficient	Data Security	31,000 hours

Stifel’s charitable contributions totaled over $9 million in 2023. In the past two years, our employee donation matching program totaled another $1.5 million.	Stifel obtained over $74 million in products and services from women, minority and veteran owned suppliers.	In 2023, Stifel was once again the number one underwriter of affordable housing transactions.	Stifel HQ is is completing a major phase of improvements, achieving a 33% increase in energy efficiency.	We continued to invest significantly in our technical services division to ensure Stifel’s clients and their information are thoroughly protected.	Stifel associates contributed over 31,000 hours of volunteering in 2023.



Name	Independence Year Commencing	Occupation and Career Highlights	Committee Membership and Board Leadership

Adam T. Berlew	Independent 2019	CMO, Equinix, Inc.; Former Executive Director, Google Cloud AI & Industry Solutions	Compensation; Risk Management

Maryam S. Brown	Independent 2023	President, SoCalGas; Former Senior Counsel, Energy and Environment, Speaker of the House, US Congress	Risk Management

Michael W. Brown	Independent 2010	Retired, Vice President & CFO, Microsoft Corporation	Audit (as of Annual Meeting)

Lisa L. Carnoy	Independent 2023	Former CFO and Head of Operations, AlixPartners	Audit; Risk Management

Robert E. Grady	Independent 2010	Advisory Partner, Summit Partners Former Partner, The Carlyle Group	Nominations & Corporate Governance; Risk Management, Chair

James P. Kavanaugh	Independent 2022	Co-Founder & CEO, World Wide Technology	Compensation

Ronald J. Kruszewski	Not Independent 1997	Chairman & CEO, Stifel Financial Corp.	Chairman

Daniel J. Ludeman	Independent 2019	Former President and CEO, Wells Fargo Advisors	Audit; Risk Management

Maura A. Markus	Independent 2016	Retired, President, COO & Board Director, Bank of the West	Audit; Nominations & Corporate Governance, Chair

David A. Peacock	Independent 2017	CEO, Advantage Solutions, Former President, Anheuser-Busch	Lead Independent Dir.; Compensation, Chair; Nominations & Corporate Governance

Thomas W. Weisel	Not Independent 2010	Sr. Managing Director, Stifel Financial Corp.; Chairman & CEO, Thomas Weisel Partners Group, Inc.

Michael J. Zimmerman	Independent 2013	Vice Chairman, Continental Grain Company	Audit, Chair (as of Annual Meeting)



Core Qualifications and Experience
u Integrity, business judgment and commitment u Demonstrated management ability u Extensive experience in the public, private or not-for-profit sectors		u Leadership and expertise in their respective fields u Financial literacy u Strategic thinking u Reputational focus

Diversity of Skills and Experiences
u Audit, Tax and Accounting u Cybersecurity u Digital u Financial Services: Banking u Financial Services: Global Wealth Management u Financial Services: Institutional u General Management u Government, Regulation and Public Policy u Marketing and Branding u Risk Management		u Talent and HR Management u Technology u CEO, President or COO u CFO or other Financial Expert u ESG u Complex Regulated Industries u Government Service u Private Company Management/Governance u Public Company Management/Governance u Not for Profit


Audit Committee
The Audit Committee met 8 times during 2023.
Committee Chair:* u Michael Brown u Zimmerman Members: u Carnoy u Ludeman u Markus Committee members are independent directors as defined by the NYSE, the SEC, and as determined by our Board.		Committee Role, Responsibilities and Qualifications:

		u Recommending to the Board a public accounting firm to be nominated for shareholder ratification as our independent auditors and compensating and terminating auditors as deemed necessary; u Meeting periodically with our auditors and financial management to review the scope of the proposed audit for the then-current year, the proposed audit fees, and the audit procedures to be utilized, reviewing the audit and eliciting the judgment of the independent auditors regarding the quality of the accounting principles applied to our financial statements; and u Evaluating on an annual basis the qualification, performance, and independence of the independent auditors, based on the Audit Committee’s review of the independent auditors’ report and the performance of the independent auditors throughout the year. u Each member of the Audit Committee is financially literate, knowledgeable, and qualified to review financial statements. Our Board has designated each Audit Committee member an “audit committee financial expert.” * Mr. Michael Brown is currently Chair and Mr. Zimmerman is currently Deputy Chair of the Committee. As part of a transition plan, as of the date of the Annual Meeting, Mr. Zimmerman will become Chair and Mr. Michael Brown will become a member.


Compensation Committee
The Compensation Committee met 4 times during 2023.
Committee Chair: u Peacock Members: u Berlew u Kavanaugh Committee members are independent directors as defined by the NYSE, the SEC, and as determined by our Board.		Committee Role, Responsibilities and Qualifications:

		u Reviewing executive performance and recommending to our Board the compensation of each of our executive officers; u Reviewing market data to assess the components of our executive compensation; u Reviewing and approving executive compensation elements and plans; u Making recommendations to our Board regarding the adoption, amendment, and rescission of certain employee benefit plans; and u Reviewing the Company’s compensation policies and practices with respect to the Company’s employees to ensure that they are not reasonably likely to have a material adverse effect on the Company. u During 2023, there were no interlocks or insider participation on the part of the members of the Compensation Committee. u See page 56 for further description of the lack of interlocks and insider participation on the Compensation Committee.


Risk Management Committee

The Risk Management Committee met 5 times during 2023.



1.	2.	3.	4.	5.

Identify Key Metrics (Quantitative & Qualitative)	Establish Peer Group, Gather Market Pay and Shareholder Input	Review of Performance and Market	Make Year-End Pay and Performance Decisions	Determine Form and Allocate Awards

Financial Objectives: growth in earnings; net income and revenue; risk management Long-Term Objectives: increase ROCE and book value; enhance return to shareholders Strategic Objectives: integration of acquisitions; organic growth	Ongoing solicitation of shareholder input and incorporation of shareholder compensation priorities Independent consultant assisted the Committee with: identifying peer companies; gathering peer and supplemental market pay data for Committee reference.	Periodic updates during the year from the CEO Company performance; segment performance; individual executive officer performance. Periodic updates from independent consultant: relative performance; competitive pay levels; alignment of pay and performance; market trends.	Committee decisions based on results of the incentive framework (see below) that include an in depth review of Company, CEO and other executive officer performance across multiple factors. Pay for executive officers other than the CEO recommended by CEO, subject to Committee approval.	Committee awarded 2023 incentive compensation in the form of cash salary and bonuses composed of cash, debenture, restricted cash, RSU and PRSU components.



Named Executive Officer	Realized Compensation	At-Risk Compensation

CEO: Mr. Kruszewski	21% of Annual Incentive Compensation	79% of Annual Incentive Compensation

Office of the President: Co-Presidents Zemlyak and Nesi	35% of Annual Incentive Compensation	65% of Annual Incentive Compensation

Committee Assessment:	Realized and Not Retentive	At-Risk and Retentive



Primary Performance Goals	2023 Result	Year-Over-Year Change

▶ Non-GAAP Pre-Tax Net Income	$770mm	19%

▶ Non-GAAP Net Revenue	$4.35bn	1%

▶ Non-GAAP Diluted Earnings per Share (EPS)	$4.68	19%



Additional Considerations	2023 Result	Year-Over-Year Change

▶ Non-GAAP Return on Common Equity	12%	4%

▶ Total Shareholder Return (price increase + dividend)	$12.22	$23.07

▶ Non-GAAP Pre-Tax Margin on Net Revenues	18%	4%

▶ Book Value Per Share	$45.61	4%

▶ Non-GAAP Comp to Revenue Ratio	58%	even

▶ Total Capitalization of Stifel Financial Corp.	$7.0bn	14%



Performance Categories		Achievements
▶ Financial Results		See pages 31 to 35 for a detailed description of achievements in these four categories in relation to each named executive officer.
▶ Strategic Achievement
▶ Leadership
▶ Risk Management



We Continue To Grow and Invest in our Future

Delivering Value to Shareholders	New Business Operating Capabilities	Expense Control	Solidifying our Position as a Premier Firm

u Record revenue for Global Wealth Management u 3^rd highest revenue for Institutional Group u Board of Directors authorized a 20% increase in common stock dividend starting in the first quarter of 2023.	During 2023, we: u Completed the Torreya Partners acquisition. u Commenced syndicated lending through an innovative joint venture with Korea Investment & Securities.	u We successfully controlled our compensation and non-compensation expenses in 2023. u This expense discipline contributed to our 17% return on tangible common equity.	u Over $444 billion in Global Wealth client assets. u Successful recruiting and acquisitions. u Stifel Bank expanded client deposits and leveraged the firm’s relationships for loan growth.



$38 billion				Assets grew to $38 billion, up 1% over 2022.


$5.3 billion				Equity of $5.294 billion, down 1% from 2022.


$46 per share				Book Value per Common Share of $45.61, up 4% over 2022.



2023 Segment Performance, Balance Sheet, Infrastructure and Additional Performance Indicators

Global Wealth Management	Institutional Group	Balance Sheet	Infrastructure

u Record net revenue of $3.0bn u Pre-tax operating income of $1.2 billion u Record recruiting pipeline; we recruited 171 new financial advisors in a challenging environment	u Net revenue of $1.2bn u Pre-tax operating income of $2 million u Improved integration and alignment across all divisions and geographies in the Institutional Group	u Maintained a Tier 1 leverage capital ratio of 10.5% u Repurchased over 7 million common shares at an average price of $61.16	u Improved client-facing infrastructure u Extended algorithmic institutional trading capabilities in both equities and fixed income u Maintained robust cybersecurity protections



Additional Performance Indicators	2023	2022	2021

Non-GAAP Return on Common Equity	12%	15%	21%

Non-GAAP Tangible Return on Common Equity	17%	22%	31%

Total Shareholder Return	21%	–15%	41%

Non-GAAP Pre-Tax Margin on Net Revenues	18%	22%	24%

Book Value Per Share	$45.61	$44.08	$41.63

Non-GAAP Compensation to Revenue Ratio	58%	58%	59%


Relative Performance	5-Year
Relative Performance	Growth	CAGR

Company Common Stock	170%	22%

Peer Group	79%	12%

S&P 500 Index	107%	16%



Realized		At-Risk

“Realized” compensation is paid either during or on account of the year, without being subject to further conditions, and is of fixed realizable value and ordinarily available to the executive officer.		“At-Risk” compensation, by contrast, is delayed and/or subject to future conditions, inlcuding potential clawbacks. An executive officer risks losing it on account of these conditions not being met.



Name	Year	Fixed Compensation				Annual Incentive Compensation						Subtotal At-Risk		Total Compen- sation⁽¹⁾
Name	Year	Base Salary				Cash Bonus		RSUs, RSAs, Debentures and Restricted Cash		PRSUs		Subtotal At-Risk		Total Compen- sation⁽¹⁾

Ronald J. Kruszewski	2023		0.20				2.26		4.52		4.52		9.04		11.50
	2022		0.20				2.00		7.00		5.00		12.00		14.20
	2021		0.20				6.70		6.30		4.00		10.30		17.20

James M. Zemlyak	2023		0.30				2.60		1.95		1.95		3.90		6.80
	2022		0.28				2.00		3.63		2.60		6.23		8.50
	2021		0.25				4.88		3.43		1.70		5.13		10.25

Victor J. Nesi	2023		0.30				0.94		1.88		1.88		3.76		5.00
	2022		0.28				2.00		3.93		2.80		6.73		9.00
	2021		0.25				5.88		4.13		2.00		6.13		12.25

Thomas B. Michaud	2023		0.30				0.54		1.49		0.68		2.16		3.00
	2022		0.25				2.35		1.50		1.10		2.60		5.20
	2021		0.25				3.95		1.93		0.88		2.80		7.00

James M. Marischen	2023		0.30				1.15		0.87		0.68		1.55		3.00
	2022		0.28				1.23		0.85		0.65		1.50		3.00
	2021		0.25				1.85		0.98		0.43		1.40		3.50

		Realized Compensation						At-Risk Compensation

	Year	Amount		% of Total		Year- over-Year % Change		Amount		% of Total		Year-over- Year % Change

Ronald J. Kruszewski	2023		2.46		21%		12%		9.04		79%		–25%
	2022		2.20		15%		–68%		12.00		85%		17%
	2021		6.90		40%		20%		10.30		60%		79%

James M. Zemlyak	2023		2.90		43%		28%		3.90		57%		–37%
	2022		2.28		27%		–56%		6.23		73%		22%
	2021		5.13		50%		26%		5.13		50%		88%

Victor J. Nesi	2023		1.24		25%		–46%		3.76		75%		–44%
	2022		2.28		25%		–63%		6.73		75%		10%
	2021		6.13		50%		28%		6.13		50%		91%

Thomas B. Michaud	2023		0.84		28%		–68%		2.16		72%		–17%
	2022		2.60		50%		–38%		2.60		50%		–7%
	2021		4.20		60%		40%		2.80		40%		87%

James M. Marischen	2023		1.45		48%		–3%		1.55		52%		3%
	2022		1.50		50%		–29%		1.50		50%		7%
	2021		2.10		60%		56%		1.40		40%		113%



Financial		Strategic Achievements

P Third-highest net revenues despite considerable market headwinds P Record Net Interest Income P Increased common shares dividend by 17% beginning in the first quarter of 2024		P Record asset management revenues P Strong recruitment of financial advisors, building on the strength of Global Wealth Management P Continued to build Stifel Bank P Completion of acquisition of Torreya Partners, bolstering the Institutional Group’s investment banking capabilities on both sides of the Atlantic

Leadership		Risk Management

P Focus on capital adequacy and risk-adjusted returns P Led direction of environmental, social and governance commitments		P Disciplined management of compensation ratio P Stable, conservative management of capital assets and in difficult operating environment



What We Do and Don’t Do

P Emphasize annual incentive compensation tied to Company and individual performance P Encourage stock ownership by deferring a portion of annual compensation in the form of RSUs and PRSUs and award long-term incentives with multi-year vesting periods of typically five years P Maintain stock ownership guidelines; currently, all executives exceed these guidelines P Focus executive officers on our long-term performance with the award of PRSUs based in significant part on ROCE performance P Utilize a formal process and incentive framework to set executive officer compensation P “Double trigger” on equity awards P Retain an independent compensation consultant P Conduct annual risk review P Engage with shareholders		X No excise tax “gross-ups” X No special CIC severance X No employment agreements X No SERPs X No hedging, short selling, or use of derivatives X Pledging by insiders requires Committee approval X No excessive perquisites X No repricing of options without shareholder approval X No option timing or pricing manipulation



Peer Group
Affiliated Managers Group Inc. Ameriprise Financial, Inc. Evercore Inc. Franklin Resources, Inc. Houlihan Lokey, Inc.	Invesco Ltd. Jefferies Financial Group Inc. Lazard Ltd. LPL Financial Holdings Inc. Moelis & Company	Northern Trust Corp. Piper Sandler Companies Raymond James Financial, Inc. T. Rowe Price Group, Inc.



Fixed Compensation & Benefits

Base Salary, Cash	Retirement Plans	Other Benefits

Provides a base level of fixed pay. Consistent with our compensation principles, Stifel maintains modest salary levels and provides most of its compensation in the form of variable incentive compensation. Cash base salary for our executive officers has not materially increased in recent years.	401(k) facilitates tax-advantaged retirement savings Named executive officers participate in the same retirement plans available to employees generally. Profit sharing plan with a match of up to $1,000.	Maintains alignment between named executive officers and other employees by limiting additional perquisites. Benefits provided to named executive officers are generally in line with those available to other employees. Limited executive officer perquisites.



Annual Variable Compensation

Cash Bonus	Debentures and Restricted Cash	RSUs and RSAs	PRSUs

Provides a competitive annual incentive. Aligns executive with shareholder interests in annual performance.	Aligns executive with shareholder interests in annual performance. Encourages retention by vesting over 5 years.	Aligns executive with shareholder interests in both annual performance and subsequent share value growth. RSUs encourage retention by vesting over 5 years. RSAs encourage retention by becoming unrestricted over 5 years, generally on equivalent terms to RSUs.	Aligns executive with shareholder interests in both annual performance and share value growth. Encourages retention by vesting over 5 years. Value depends on achievement of objective, multi-year goals. Performance based: directly tied to achievement of specific goals over a 4-year period. Metrics are Total Shareholder Return (TSR), Non-GAAP ROCE, Non-GAAP Pre-Tax Income and Non-GAAP Diluted EPS.
u Varies annually based on Company and individual performance. u Structured to better align total pay with overall Company performance. u Tied to incentive framework, which includes key corporate, strategic and individual performance indications. u Decisions also based on individual goals and performance of business segment.



Components of Annual Incentive Compensation

Cash	Time-based deferred compensation	Performance-based deferred compensation

Cash, which the Committee views as a short-term incentive and a component of Realized annual compensation.	Time-based deferred compensation, which the Committee views as a long-term incentive and a component of At-Risk annual compensation. Generally, such compensation has been a combination of restricted stock units, debentures and restricted cash.	Performance-based deferred compensation, which the Committee views as a long-term incentive and a component of At-Risk annual compensation. Generally, performance-based deferred compensation has been in the form of PRSUs.



Named Executive Officer	PRSU Award ($ millions)		PRSUs Awarded

Ronald J. Kruszewski		4.52		60,267

James M. Zemlyak		1.95		26,000

Victor J. Nesi		1.88		25,067

Thomas B. Michaud		0.68		9,000

James M. Marischen		0.68		9,067

Amounts are based on a reference share price of $75.00. Dollars rounded to the nearest $10,000.



Total Compensation Value		Percentage Deferred

less than $200,000		0%

$200,000 - $499,999		15%

$500,000 - $749,999		25% IG; 20% Other

$750,000 - $999,999		35% IG; 30% Other

more than $1,000,000		40% IG; 35% Other