Andrés Gluski
AESAbout Andrés Gluski
Andrés R. Gluski (age 67) has served as President, CEO and Director of AES since 2011; he holds an M.A. and Ph.D. in Economics from the University of Virginia and serves on AES’s Innovation & Technology Committee and the board of Waste Management . Under his tenure, AES streamlined from 28 to 12 countries and expanded corporate clean energy contracting, while long-term incentive metrics show mixed shareholder outcomes: 2022–2024 PSUs paid at 169% on Cumulative Parent Free Cash Flow, but TSR-linked PCUs paid 0% as AES TSR was -33% for the period . Five-year fundamentals show revenue growth with flattish-to-declining EBITDA, and pay-versus-performance data reflect a decline in the value of a $100 AES investment to $76 by 2024 vs peer group at $138 . AES reduced the CEO’s 2025 LTI target by 30% and shifted to 100% performance-based awards, with no salary increase since 2021 .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| The AES Corporation | EVP & COO; President, Latin America; SVP Caribbean & Central America | 2000–2011 | Led turnaround and expansion of major businesses; initiated $8B+ asset divestiture program to focus portfolio |
| Council of the Americas | Chairman | 2015–present | Regional policy leadership and stakeholder engagement |
| IMF; Venezuelan Government; Telecom/Banking | Economist; Director General of Public Finance; senior roles | Prior to AES | International finance and public policy background supporting risk management and strategy |
External Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Waste Management, Inc. | Director | 2015–present | Exposure to large-cap infrastructure and ESG practices |
| Edison Electric Institute (EEI) | Executive Committee member | Ongoing | Sector policy and innovation agenda |
Fixed Compensation
| Year | Base Salary ($) | All Other Compensation ($) | Notes |
|---|---|---|---|
| 2024 | 1,241,000 | 325,809 | Includes company contributions to qualified and non-qualified plans ($31,050 and $294,759, respectively) |
| 2023 | 1,241,000 | 314,982 | |
| 2022 | 1,241,000 | 292,401 |
- CEO declined salary increases since 2021 .
Performance Compensation
- Annual incentive structure (AIP): Safety 10%, Financials 55% (Adjusted EPS 25%, Adjusted EBITDA 15%, Parent FCF 15%), Green Growth 25%, New Business Models 10% .
- 2024 corporate performance score: 130%; CEO target bonus 150% of salary → payout $2,419,950 .
- LTI mix (2024): PSUs (Cumulative Parent FCF, 3-year cliff) 35%; PCUs (rTSR vs S&P 500 40%, S&P Utilities 40%, custom Clean Energy 20%, 3-year cliff) 35%; RSUs (time-based, 3-year ratable) 30% .
| Metric | Weight | Target | Actual/Result | Payout |
|---|---|---|---|---|
| Adjusted EPS | 25% | $1.92 | $2.14 | 200% |
| Adjusted EBITDA | 15% | $2,750M | $2,639M | 80% |
| Parent Free Cash Flow | 15% | $1,120M | $1,107M | 94% |
| Green Growth (Growth) | 12.5% | 4,500 MW | 4,381 MW | 95% |
| Green Growth (COD) | 12.5% | 3,613 MW | 3,711 MW | 111% |
| New Business Models | 10% | 100% | 125% | 125% |
| Safety metrics (aggregate) | 10% | Various | Mixed | Up to 200% on no serious incidents; 120% on SIP |
2022–2024 LTI outcomes:
- PSUs: 169% of target on Cumulative Parent FCF ($3,016M, 106.87% of target) .
- PCUs: 0% (AES TSR -33% vs indices) .
- 2024 stock vested (CEO): 334,235 shares; value $4,557,009; options exercised 396,053 shares; value $891,119 .
2024 CEO Grants (Grant date 2/22/2024; RSU vest 2025–2027):
| Award | Target | Max | Grant-Date Fair Value ($) |
|---|---|---|---|
| PSUs (Parent FCF) | 228,034 units | 456,068 units | 3,648,544 |
| PCUs (rTSR) | 1,824,270 units | 7,297,080 units | 2,592,653 |
| RSUs | 195,458 shares | N/A | 3,127,328 |
Compensation design signals:
- 2025 CEO LTI reduced 30% and 100% performance-based (50% PCUs, 50% PSUs); no 2025 salary increase .
- No single-trigger equity vesting; double-trigger upon CIC; no excise tax gross-ups; clawback policy compliant with NYSE/SEC .
Equity Ownership & Alignment
| Holder | Shares Beneficially Owned | % of Class | Notes |
|---|---|---|---|
| Andrés R. Gluski | 1,984,514 | <1% | Includes 33,309 shares in AES Retirement Savings Plan |
| All Directors & Officers (17) | 4,654,924 | 0.65% |
- CEO stock ownership guideline: 6x base salary; all NEOs compliant .
- Hedging/pledging prohibited; no margin accounts or pledges allowed .
- Outstanding unvested awards at 12/31/24 (CEO):
- RSUs: 271,221 shares ($3,490,614) .
- Unearned PSUs: 475,058 units ($6,113,996 at target) .
- Unearned PCUs: 4,430,370 units ($4,430,370) .
- 2024 vesting cadence includes 2022 RSU final tranche vesting 2/24/2025 (100% modifier) and 2024 RSUs vest ratably 2025–2027 .
Employment Terms
Key severance/CIC economics (assumes 12/31/2024 event):
- Involuntary Not for Cause or Good Reason (CEO): Cash severance $6,205,000; benefits continuation $49,442; outplacement $25,000; total $6,279,442 .
- CIC with termination/qualifying event (CEO): Cash severance $9,307,500; accelerated vesting of LTC at target $17,034,709; benefits $74,163; outplacement $25,000; total $26,441,372 .
- Death/Disability (CEO): LTC vesting at target $17,034,709 .
- Double-trigger only; no CIC excise tax gross-ups .
- Non-compete: 24 months for CEO (12 months for other NEOs); benefits continuation up to 24 months (36 months upon CIC for CEO) .
- CEO eligible for Qualified Retirement (as of 12/31/2024); LTI payout at target on original schedule .
Clawback:
- Executive officer clawback for accounting restatements; 2024 interim restatements did not affect incentive metrics; no recovery required .
Board Governance
- Roles: CEO and Director since 2011; member, Innovation & Technology Committee .
- Independence: Not independent due to employment; Board has independent Chair/Lead Independent Director (John B. Morse, Jr.) and separation of Chair and CEO roles .
- Committees: Audit, Compensation, Governance committees fully independent; meeting counts in 2024: Audit 8, Compensation 7, Governance 6, Innovation & Technology 5 .
- Attendance: 96% average Board/committee attendance; independent directors held seven executive sessions in 2024 .
- Say-on-Pay: 96% approval in 2024; >94% approval annually since 2012 .
- Director pay: Management directors (incl. CEO) receive no director fees .
Director Compensation (Context)
- Non-employee director annual retainer $100,000 (cash or DSUs) and $175,000 deferred stock units; Chair retainer at 1.62x and DSU grant at 1.74x; committee chair fees: Audit $25,000; others $20,000 .
- CEO receives no additional pay for Board service .
Performance & Track Record
- Strategic execution: 6.8 GW new contracts signed/awarded in 2024; 3.7 GW constructed/acquired; backlog nearly 12 GW; coal retirement progress (481 MW retired in 2024; 13.4 GW exits announced/closed since 2017) .
- Annual incentives findings reflect solid EPS/Parent FCF vs targets but below-target EBITDA; AIP payout 130% .
- TSR during 2022–2024 LTI cycle -33% relative to indices (PCUs paid 0%) .
- Pay versus Performance (value of $100 investment):
Year AES TSR ($) Peer Group TSR ($) 2020 122 101 2021 129 118 2022 158 120 2023 109 112 2024 76 138
Financial Context (for pay-performance assessment)
| Metric | FY 2020 | FY 2021 | FY 2022 | FY 2023 | FY 2024 |
|---|---|---|---|---|---|
| Revenues ($, mm) | 9,660 * | 11,141 * | 12,617 * | 12,668 * | 12,278 * |
| EBITDA ($, mm) | 3,596* | 3,622* | 3,418* | 3,384* | 3,280* |
| Values retrieved from S&P Global. | |||||
| Note: Periods shown oldest to newest. |
Compensation Structure Analysis
- Strong use of at-risk pay: 91% of CEO target comp variable; performance-centric metrics (EPS, Parent FCF, EBITDA, green growth) .
- Tougher LTI design for 2025 (100% performance-based) responds to below-peer TSR and aligns with shareholder interests .
- No single-trigger vesting, no repricing, no hedging/pledging, and clawback in place—governance-friendly features .
- Peer benchmarking at ~50th percentile with WTW data; blend of general industry and energy peers; 2024 PCU peer methodology updated to custom clean energy cohort (e.g., NextEra, Ørsted, Iberdrola) .
Risk Indicators & Red Flags
- TSR underperformance in recent cycles (PCUs 0% for 2022–2024) despite operational execution—watch estimate momentum and capital allocation .
- Material weakness disclosed in Form 10-K; 2024 interim restatements did not affect compensation metrics; clawback not triggered .
- Insider selling pressure appears limited to programmatic vestings/exercises; pledging prohibited; CEO ownership <1% but meets 6x guideline .
Board Governance (Dual-role implications)
- CEO also serves as Director; not independent; mitigants include independent Chair/Lead Independent Director, fully independent key committees, and regular executive sessions .
- Committee service: Innovation & Technology Committee member—exposure to tech risk/opportunity oversight .
Say-on-Pay & Shareholder Feedback
- 96% support in 2024; continued investor outreach on renewables growth, coal exit progress, compensation and succession .
Investment Implications
- Pay program linkage appears disciplined: strong AIP alignment to EPS/FCF; LTI outcomes penalize TSR underperformance (0% PCUs), and 2025 shift to 100% performance-based LTI is a constructive signal .
- Retention risk contained: robust equity holdings, compliance with ownership guidelines, and competitive severance/CIC terms with double-trigger mechanics; CEO could retire with target treatment, but non-compete and equity structure encourage orderly transition .
- Watch catalysts/risks: delivery on 12 GW backlog, EBITDA trajectory vs guidance after below-target 2024 EBITDA, and TSR catch-up vs peers; compensation outcomes will increasingly track Parent FCF and relative TSR, creating trading signals around performance updates .
References:
- AES 2025 DEF 14A (filed Mar 19, 2025): .
- AES corporate bio: https://www.aes.com/about-us/our-people/our-leadership/andres-gluski.