James M. Cracchiolo
AMERIPRISE FINANCIALAbout James M. Cracchiolo
Chairman and Chief Executive Officer of Ameriprise Financial since the 2005 spin-off; age 66; MBA and BA (Accounting/Economics) from New York University; prior CPA (inactive) . Under his tenure, Ameriprise has delivered record adjusted operating net revenues, earnings, EPS and best-in-class ROE in 2024, and No. 1 total shareholder return within the S&P 500 Financials Index since the 2005 spin-off, with 1-, 3-, and 5-year TSR of 42%, 85%, and 250%, respectively, through 12/31/24 . The combined CEO/Chair structure is paired with an independent Presiding Director and fully independent key committees; 7 of 8 director nominees are independent .
Past Roles
| Organization | Role | Years | Strategic impact |
|---|---|---|---|
| Ameriprise Financial (formerly American Express Financial Advisors) | Chairman & Chief Executive Officer | 2005–present | Led 20-year transformation since spin-off; strategy, capital return and long-term TSR leadership . |
| American Express Global Financial Services | Group President; CEO/President/Chair of American Express Financial Corporation; Chair of American Express Bank Ltd. | 2000–2005 | Oversaw large-scale financial services businesses prior to AMP spin . |
| American Express TRS International | President & CEO | 1998–2000 | Grew international payments and network capabilities . |
| American Express Global Network Services | President | 1997–1998 | Expanded partner network strategy . |
| American Express TRS Quality/Global Reengineering | SVP | 1993–1997 | Drove enterprise process improvement at scale . |
| Shearson Lehman Brothers (then AMEX unit) | EVP & Chief Financial Officer | 1990–1993 | Finance leadership in capital markets platform . |
External Roles
| Organization | Role | Years | Notes |
|---|---|---|---|
| Business Roundtable | Member | n/a | Senior CEO policy forum . |
| March of Dimes | Advisory Board Member (former) | n/a | Community leadership . |
| American Council of Life Insurers | Director (former) | n/a | Industry governance . |
| Financial Services Roundtable | Director (former) | n/a | Industry advocacy . |
Fixed Compensation
| Metric ($000s) | 2022 | 2023 | 2024 |
|---|---|---|---|
| Base Salary | 1,025 | 1,250 | 1,250 |
| Annual Cash Incentive (AIA) | 8,125 | 8,375 | 8,500 |
| Long-Term Incentive Award (LTIA) | 16,000 | 16,000 | 19,000 |
| Total Direct Compensation | 25,150 | 25,625 | 28,750 |
- 2024 target pay design: Salary $1.25M; AIA target $5M (levered by formula); LTIA target range raised from $12–$16M to $14–$19M to reflect market, performance and retention priorities .
Performance Compensation
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Annual Incentive (AIA) structure: 70% financial (net revenues, earnings, EPS, ROE; adjusted operating, ex-unlocking), 30% business/strategic scorecard; 1–5 scale with preset targets and limited adjustments (e.g., 2024 equity market out-of-range and transformation severance costs) . 2024 overall score 4.8 (“Distinguished”) → AIA funding 170% of target; CEO award aligned to formulaic funding .
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Long-term incentives: Majority of pay delivered in LTIs with half in PSUs; PSUs are 3-year cliff with goals for average ROE and EPS CAGR plus a ±25pp TSR modifier vs S&P 500 Financials; options have 10-year term; RSUs vest ratably over 3 years .
AIA outcome (2024)
| Component | Weight | Targeting method | 2024 Result | Payout impact |
|---|---|---|---|---|
| Financial performance (adjusted, ex unlocking) | 70% | Pre-set targets based on annual plan | Contributed to overall 4.8 score | Included in 170% pool |
| Business & Strategic | 30% | Five strategic focus areas - | 4.2 (“Exceeded”) | Included in 170% pool |
| Total | 100% | — | Overall 4.8 (“Distinguished”) | AIA at 170% of target |
PSU program (2022–2024 tranche paid Feb-2025)
| Metric | Target | Actual (ex unlocking) | Pre-TSR leverage | TSR modifier | Final payout |
|---|---|---|---|---|---|
| Average ROE | 45.5% | 49.7% | 150% | +25pp (ranked 4/60) | 175% of target |
| EPS CAGR | 9.0% | 15.9% | 150% | — | — |
Grant mechanics (2024 awards granted for 2023 performance; examples)
- 1/26/24 CEO awards: 20,439 target PSUs; 11,854 RSUs; 29,766 options @ $391.40; grant-date fair values $8.0M (PSU target), $4.64M (RSU), $3.36M (options) .
Equity Ownership & Alignment
Ownership snapshot (as of 3/3/2025)
| Metric | Amount |
|---|---|
| Shares owned | 111,929 |
| Right to acquire within 60 days (options) | 171,620 |
| Deferred Share Units and RSUs | 192,397 |
| Total shares beneficially owned plus DSUs/RSUs | 475,946 |
| Shares pledged as collateral | None (prohibited) |
Policies and compliance
- Stock ownership guideline: CEO 10× base salary; other NEOs 4×; CEO actual ownership equals 108.7× base salary at FY-end; must retain 75% of net shares until guideline met .
- Hedging/pledging: Prohibited for directors and executive officers .
- Directors, officers may not pledge AMP stock; company confirms no pledges outstanding for insiders .
Vesting schedules and remaining dates
- Options/DSOs vest 33.33% annually over 3 years; remaining dates for open grants: 1/26/2025, 1/26/2026, 1/26/2027 .
- RSUs/DSUs vest 33.33% annually over 3 years; remaining dates identical .
- PSUs: 3-year cliff vest at payout (e.g., 2024 grants vest/payout Jan 2027) .
2024 realized liquidity events (CEO)
| Event | Quantity | Value realized |
|---|---|---|
| Option exercises | 39,834 | $8,853,107 |
| Option exercises | 25,000 | $9,993,500 |
| PSU vesting (2019–2021 tranche vesting in 2024) | 53,506 | $21,033,744 |
| RSU vesting (multiple tranches) | 4,490; 4,215; 5,911 | $1,757,386; $1,649,751; $2,323,673 |
Deferred compensation and pension alignment (CEO)
| Program | Balance/Value |
|---|---|
| Deferred Compensation Plan – aggregate balance | $151,861,815 |
| Supplemental Retirement Plan – present value | $21,620,147 |
| Retirement Plan (cash balance) – present value | $1,189,844 |
Employment Terms
| Element | Key terms |
|---|---|
| Employment agreement | No individual employment contract; U.S. NEOs covered by plan-based severance; CEO exception only for plan terms . |
| Severance (no change in control) | CEO: 2× (salary + 3-yr avg bonus); other U.S. NEOs: 1.5×; paid in installments with 6-month delay . |
| Severance (double-trigger change in control ≤2 years) | CEO: 3× (salary + 3-yr avg bonus); Berman/Truscott/Sweeney: 3×; new U.S. execs (post-3/19/2008): 2× . |
| AIA proration | Pro rata AIA possible on involuntary not-for-cause; under CoC double-trigger, U.S. NEOs receive 2-year average AIA . |
| Equity treatment | No single-trigger; on CoC + qualifying termination: full acceleration for options/RSUs; PSUs prorated; retirement: awards continue on schedule; death/disability: acceleration . |
| Clawbacks | NYSE-compliant restatement clawback (3 years) plus misconduct clawback for Executive Leadership Team (effective for 2020+ awards) . |
| Non-compete/Non-solicit | U.S. executives: up to 1-year non-compete/non-solicit; detrimental conduct recoupment up to two years of LTI proceeds . |
Board Governance and Director Service
- Board service: Director since 2005; CEO and Chairman; Chair of the Executive Committee .
- Independence and oversight: 7 of 8 director nominees independent; independent Presiding Director (Sharpe) with defined powers; regular independent executive sessions; Audit & Risk, Compensation & Benefits, and Nominating & Governance Committees are fully independent .
- Board attendance: All nominees attended all Board and committee meetings in 2024 .
- Director pay: Inside director (CEO) receives no additional director compensation .
Compensation Committee & Peer Group
- Independent consultant: Semler Brossy (since 2019); committee annually confirms independence; scope includes benchmarking, peer group design, and program advice -.
- Peer group (2024): Asset Management (BlackRock, Carlyle, Jefferies, Invesco, T. Rowe Price); Advice & Wealth Management (BNY Mellon, Charles Schwab, Morgan Stanley, Raymond James, State Street, U.S. Bancorp); Retirement & Protection (Aflac, Principal, Prudential) .
- Say-on-pay: 2024 approval ~89%; ongoing shareholder engagement with top holders representing ~one-third of shares .
Risk Indicators & Red Flags
- Hedging/pledging: Prohibited; none of CEO/director shares are pledged .
- Option repricing: Not permitted without shareholder approval .
- Related-party transactions: Routine, arm’s length; none material to AMP disclosed; e.g., distribution and advisory relationships with BlackRock and Vanguard .
- Section 16 reporting: Company notes several historical late Form 4s (including one for CEO in 2017) omitted in prior proxies; all 2024 reports timely .
- Clawbacks: Robust dual policies (restatement and misconduct) in force .
Compensation Structure Analysis
- Mix and risk: Approximately 94% of CEO compensation is performance-based; 72% of incentives are long-term; half of LTIs are PSUs with 3-year performance and TSR modifier, emphasizing durable value creation .
- 2024 design changes: Increased CEO LTIA target range to $14–$19M signals high retention priority and recognition of long-term outperformance; salary and AIA targets unchanged .
- Performance rigor: 2024 AIA funded at 170% on a 4.8/5.0 score, supported by record adjusted operating results; PSUs (2022–2024) paid 175% with top-decile TSR vs S&P 500 Financials, indicating strong alignment to shareholder returns .
Investment Implications
- Alignment and retention: Very high at-risk, long-term equity orientation and ownership multiples (CEO at ~109× salary) support strong alignment; prohibition on pledging/hedging reduces governance risk; raised LTIA target enhances retention continuity for a long-tenured, high-performing CEO .
- Potential selling pressure windows: Material option exercises and PSU/RSU vestings in 2024 indicate periodic liquidity events; upcoming vesting dates (Jan 2025–2027) and option tenors create known supply windows—monitor Form 4s around scheduled vesting/exercise dates .
- Downside protection and costs: Double-trigger CoC protections (3× multiple for CEO) are market-competitive but sizable; absence of employment agreement preserves flexibility; robust clawbacks mitigate misconduct and restatement risk .
- Governance: Combined Chair/CEO is mitigated by strong independent board structure and an empowered Presiding Director; say-on-pay support (89%) and active engagement suggest investor acceptance of pay-program-performance linkage .