Aaron E. Alt
CARDINAL HEALTHAbout Aaron E. Alt
Aaron E. Alt is Chief Financial Officer of Cardinal Health, appointed effective February 10, 2023; he was 51 at the time of appointment and has 2 years of tenure as of the 2025 proxy . He holds an MBA from Northwestern’s Kellogg School, a JD from Harvard Law School, and a BA from Northwestern . Long-term incentive performance over FY23–FY25 paid at 212% of target, driven by adjusted non-GAAP diluted EPS CAGR of 17.6% and average annual dividend yield of 2.9%, with a +20% TSR modifier from 100th percentile performance versus the S&P 500 Health Care Index; three-year TSR was 235.5% versus 9.4% for the index .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Cardinal Health | CFO (appointed) | Feb 2023–present | Leads enterprise finance, capital deployment, investor relations, accounting and corporate development |
| Sysco Corporation | EVP & CFO | Dec 2020–Dec 2022 | Drove balance sheet improvements and underlying profitability |
| Sally Beauty Holdings | SVP & CFO; President, Sally Beauty Supply | May 2018–Nov 2020 (President Oct 2018–Nov 2020) | Senior finance/operating roles across CFO/CAO and business unit leadership |
| Target Corporation | SVP, Operations | Mar 2017–May 2018 | Senior operational leadership in retail operations |
| Sara Lee Corporation | Senior roles (Finance/Operations) | Prior to Target | Senior-level finance and operations roles |
| Kirkland & Ellis (London) | Partner | Prior to Sara Lee | Legal leadership experience |
Fixed Compensation
Multi-year reported compensation (Summary Compensation Table):
| Metric | FY 2023 | FY 2024 | FY 2025 |
|---|---|---|---|
| Salary ($) | 375,205 | 846,038 | 871,164 |
| Bonus ($) | 1,000,000 | — | — |
| Stock Awards ($) | 3,815,637 | 4,824,118 (incl. modification expense) | 3,977,813 |
| Non-Equity Incentive ($) | 544,798 | 1,153,996 | 1,303,262 |
| All Other Compensation ($) | 265,008 | 18,749 | 57,796 |
| Total ($) | 6,000,648 | 6,842,901 | 6,210,035 |
Target and base salary levels:
| Metric | FY 2024 | FY 2025 |
|---|---|---|
| Base Salary (Annualized) ($) | 850,000 | 875,000 |
| Annual Incentive Target (% of Base) | 110% | 110% |
| Annual Incentive Target ($) | 935,000 | 962,500 |
| Long-Term Incentive Target ($) | 3,750,000 | 3,850,000 |
All Other Compensation detail (FY 2025):
| Component | Amount ($) |
|---|---|
| Company 401(k) Savings Plan Contributions | 14,000 |
| Company Deferred Compensation Plan Contributions | 4,296 |
| Matching Charitable Contributions | 39,500 |
| Perquisites | — |
| Total | 57,796 |
Performance Compensation
Annual incentive (MIP) structure and FY 2025 payout:
| Metric | Weighting | Target | Actual/Payout | Notes |
|---|---|---|---|---|
| Adjusted non-GAAP operating earnings | 65% | Committee-set | Part of corporate function calc | Enterprise-weighted for corporate officers |
| Non-GAAP adjusted free cash flow | 15% | Committee-set | Part of corporate function calc | Liquidity alignment |
| Strategic business objectives | 10% | Committee-set | Part of corporate function calc | Strategy goals |
| Our Path Forward | 10% | Committee-set | Part of corporate function calc | Employee engagement/training dimensions |
| Final payout (Corporate function) | — | 100% | 136% of target (Alt) | Committee applied negative discretion from calculated 140% |
| Alt FY2025 target and payout | Target $958,281 | — | Actual $1,303,262 | Target percent 110% of base |
FY 2025 equity grants (annual grant dated Aug 15, 2024):
| Award | Grant Date | Shares/Target | Grant Date Fair Value ($) |
|---|---|---|---|
| RSUs | 8/15/2024 | 14,271 | 1,539,984 |
| PSUs (Target) | 8/15/2024 | 21,407 | 2,437,829 |
FY23–FY25 PSU performance (three-year cycle):
| Metric | Weighting | Target | Actual | Payout Impact |
|---|---|---|---|---|
| Sum of adj. non-GAAP diluted EPS CAGR + avg annual dividend yield | — | Committee-set | 17.6% EPS CAGR; 2.9% dividend yield | Earned; contributes to 177% before TSR |
| Cost savings | — | Committee-set | 137% of target | Earned; contributes to 177% before TSR |
| Our Path Forward | — | Committee-set | 96% of target | Earned |
| Relative TSR modifier vs S&P 500 Health Care Index | ±20% | — | 100th percentile | +20% applied |
| Final PSU payout | — | 100% | — | 212% of target |
| Alt shares earned (FY23–25 PSU) | Target 31,815 | — | Earned 67,448 | 212% payout |
Equity Ownership & Alignment
Stock ownership policy and compliance (as of June 30, 2025):
| Name | Target Ownership (Multiple of Base Salary) | Dollar Target ($) | Actual Ownership (Multiple) | Value of Shares Held ($) |
|---|---|---|---|---|
| Alt (CFO) | 4x | 3,500,000 | 5.7x | 4,982,187 |
Beneficial ownership and outstanding awards (as of September 8, 2025 and June 30, 2025):
| Item | Amount |
|---|---|
| Common shares beneficially owned | 0 (less than 1%) |
| Additional RSUs and PSUs (vested/unvested, not settled within 60 days) | 30,650 |
| Unvested RSUs (shares; market value at $168) | 29,575; $4,968,600 |
| Unearned PSUs (shares; market/payout value at $168) | 160,040; $26,886,720 |
RSU vesting schedule (Alt):
| Vest Date | Shares |
|---|---|
| Aug 15, 2025 | 10,288 |
| Feb 15, 2026 | 4,242 |
| Aug 15, 2026 | 10,288 |
| Aug 15, 2027 | 4,757 |
Policies and alignment levers:
- Hedging and pledging prohibited; executive officers/directors may not hold shares in margin accounts or pledge CAH securities as collateral .
- Clawback policy (Nov 2023) mandates recovery of erroneously awarded incentive-based compensation after restatements; additional contractual clawbacks for misconduct in MIP and 2021 LTIP .
Employment Terms
Offer letter and restrictive covenants:
- Initial base salary $825,000; target annual bonus 110% (prorated first year); target LTI $3,500,000 (60% PSUs, 40% RSUs) .
- Sign-on cash bonus $1,000,000; relocation lump sum $250,000; initial LTI grant of $2,500,000 PSUs and $1,000,000 RSUs; repayment obligations if terminated for cause or voluntary departure in first/second year .
- Confidentiality and Business Protection Agreement includes 24-month non-solicit; non-compete restrictions on employment by competitors and soliciting business; governed by Ohio law .
Severance and change of control economics:
- Through Sept 21, 2025 (Amendment): Involuntary termination without cause → cash severance 1.75x salary+target bonus for non-CEO, prorated annual bonus (actual performance), prorated vesting of unvested RSUs/PSUs; health benefits up to 18 months; outplacement up to $25,000 .
- After Sept 21, 2025: reverts to original terms (1.5x for non-CEO; no prorated vesting of unvested RSUs/PSUs unless retirement-eligible under LTIP) .
- Change-of-control period (two years post-CiC): termination without cause or for good reason → cash severance 2.0x salary+target bonus for non-CEO; prorated annual bonus based on greater of target or actual; health benefits and outplacement .
Potential payments for Alt (as of June 30, 2025; uses $168 share price):
| Scenario | Cash Severance ($) | Annual Incentive ($) | LTI Awards ($) | Medical ($) | Outplacement ($) | Total ($) |
|---|---|---|---|---|---|---|
| Voluntary Termination | 0 | 0 | 0 | 0 | 0 | 0 |
| Involuntary Termination Without Cause | 3,215,625 | 958,281 | 22,601,376 | 28,155 | 25,000 | 26,828,437 |
| Death or Disability | 0 | 958,281 | 31,855,320 | 28,155 | 25,000 | 32,813,601 |
| Qualifying Termination Following Change of Control | 3,675,000 | 958,281 | 31,855,320 | 28,155 | 25,000 | 36,541,756 |
Compensation Peer Group and Say-on-Pay
- Comparator Group includes Abbott, McKesson, CVS, UnitedHealth, UPS, Target, and peers; used to position target total direct compensation near median; CAH revenue is top quintile, market cap bottom quintile of group .
- 2024 say-on-pay approval was 90% of votes cast; strong shareholder support reiterated in 2025 engagement .
Equity Grant Practices and Governance
- Annual equity grants approved on or before August grant date; no backdating; no option repricing; equity run rate 0.39% in FY 2025 .
- Executive compensation governance features include performance-based pay mix, minimum vesting periods, clawbacks, stock ownership guidelines, no single-trigger CiC, and no excise tax gross-ups .
Investment Implications
- Pay-for-performance alignment is strong: FY23–FY25 PSU payout at 212% tied to EPS CAGR and dividend yield with a TSR modifier; Alt’s earned PSU shares rose to 67,448 from a 31,815 target, linking his realized equity to multi-year performance .
- Retention and insider selling pressure: Upcoming RSU vest dates across Aug 2025/Feb 2026/Aug 2026/Aug 2027 create potential sale windows, though CAH’s insider trading policy bans hedging/pledging and requires retention of net shares until ownership guidelines are met; Alt exceeds his 4x ownership requirement at 5.7x, mitigating misalignment risk .
- Severance/CiC economics are moderate for a CFO (1.5–2.0x cash multiples post-amendment), with prorated vesting only available under the temporary amendment or retirement criteria; no CiC tax gross-ups reduce governance risk .
- Track record: Company performance and capital deployment have been robust, supporting higher annual incentive payouts (Alt: 136% of target in FY 2025) and underpinning equity value; three-year TSR far exceeded sector, indicating execution on strategic priorities .