David Kemper
COMMERCE BANCSHARES INC /MO/About David Kemper
David W. Kemper is Executive Chairman of Commerce Bancshares, Inc. (CBSH), serving as a director since 1982 and Executive Chairman since August 2018; he previously served as Chairman & CEO (1991–2018) and President (1982–2013). He holds degrees from Harvard College (cum laude), Oxford (M.A. in English literature), and Stanford GSB (MBA), and is a past President of the Federal Advisory Council to the Federal Reserve Board . CBSH’s pay-versus-performance data show total shareholder return of 128 in 2024 on a fixed $100 basis, with Net Income of $534,401k and “Actual Revenue” of $1,663,622k; over 2020–2024 TSR and revenue trended upward with a dip in 2023 amid sector volatility .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Commerce Bancshares, Inc. | Executive Chairman | Aug 2018–present | Oversight and continuity after separating Chairman/CEO roles; chairs Executive Committee |
| Commerce Bancshares, Inc. | Chairman & CEO | 1991–2018 | Led multi-decade growth; combined chair/CEO role until separation in 2018 |
| Commerce Bancshares, Inc. | President | 1982–Feb 2013 | Enterprise leadership across cycles; positioned the bank through strategic shifts |
External Roles
| Organization | Role | Years | Notes |
|---|---|---|---|
| Tower Properties Company | Director | Since Oct 1989 | Related-party ties; CBSH terminated Tower contracts effective Dec 31, 2024 |
| Post Holdings, Inc. | Director | Since Sep 2015 | Public company board service |
| Crawford Group, Inc. (Enterprise Mobility parent) | Board member | Ongoing | Interlock with CBSH director Christine B. Taylor who is a director at The Crawford Group, Inc. |
| Washington University in St. Louis; Missouri Botanical Garden; St. Louis Art Museum | Board member | Ongoing | Civic and cultural leadership |
Fixed Compensation
| Component | 2024 Amount ($) |
|---|---|
| Base salary and other compensation | 443,936 |
| Actual bonus paid | 165,800 |
Notes:
- As an employee director, he receives no additional director fees; non-employee director fee schedule does not apply to him .
Performance Compensation
| Award Type | 2024 Amount ($) | Grant/Structure | Vesting |
|---|---|---|---|
| Equity awards | 249,928 | Restricted stock awards under Equity Incentive Plan (company-wide plan framework) | Restricted stock generally vests at four years for current-year grants; five years for long-term restricted stock; vesting conditioned on cumulative positive net income; change-of-control accelerates vesting |
Notes:
- Company incentive metrics used for NEOs in 2024: Net Income, Pre-provision Net Revenue (PPNR), Revenue, and ROE vs peer banks; funding range 0%–164% of target. Exec Chairman’s specific metric weighting/payouts are not disclosed .
Equity Ownership & Alignment
| Category | Shares | % of Class | Detail |
|---|---|---|---|
| Beneficial ownership | 1,234,052 | 1.2% | Includes 1,204,557 shares where he shares voting power with John W. Kemper |
| Shared voting/investment power | 122,093 | — | Shared voting and investment power |
| Shares owned by a corporation (disclaimed except to pecuniary interest) | 270,564 | — | Owned by a corporation where David, John W., and Jonathan M. Kemper are shareholders/directors |
| Shares where voting is shared with John W. Kemper | 1,204,557 | — | Included within beneficial ownership |
| Shares where John W. Kemper is beneficial owner but voting is shared with David | 49,159 | — | Voting power shared |
Additional alignment policies:
- Executive stock ownership guideline: Chairman and CEO must hold 6x base salary; executives must achieve targets within three years; NEO compliance disclosed as of Dec 31, 2024 (Exec Chairman not in NEO disclosure) .
- Anti-hedging policy prohibits derivative transactions in company stock; clawback policy in effect for incentive-based comp restatements .
Employment Terms
- Employment agreements: Company discloses no employment agreements for NEOs; Exec Chairman’s agreement terms are not specifically disclosed .
- Severance and change-of-control: Company’s severance agreements provide double-trigger benefits for NEOs (3x salary+average bonus; target or prior-year bonus; continued benefits up to 3 years; loan facility to cover option exercise and taxes; outplacement; excise tax gross-ups except for the CEO). Exec Chairman-specific severance terms are not detailed in the proxy .
- Equity acceleration/retirement: Unvested restricted stock/SARs vest pro rata upon death/disability; retirement requires age ≥60 and ≥10 years of service with pro rata vesting at restriction end subject to performance; change-of-control accelerates vesting .
- Clawback: Adopted October 2023; recoups incentive compensation tied to restated results regardless of fault .
- Non-compete: Signing a non-compete is a condition to restricted stock grants (for retirement definition) .
- Deferred comp/pension: CERP/EICP details disclosed for NEOs; Exec Chairman’s specific balances/credits in CERP/EICP are not disclosed in the proxy .
Board Governance
| Item | Detail |
|---|---|
| Board service | Director since February 1982 |
| Role | Executive Chairman; chairs Executive Committee |
| Independence | Not independent (employee director) |
| Committee memberships | Executive Committee (Chair) |
| Board leadership history | Combined CEO+Chair until 2018; roles separated with David becoming Executive Chairman and John W. Kemper becoming CEO |
| Lead Independent Director | Chairman of Committee on Governance/Directors serves as Lead Director (Earl H. Devanny, III in 2024) |
| Meeting attendance | All Directors attended 100% of Board/committee meetings in 2024 |
| Director compensation | Employees receive no additional compensation for serving as Director; non-employee director fees are converted monthly into stock under Director Plan; stock ownership requirement of $300,000 for non-employee directors |
Dual-role implications:
- Exec Chairman is an employee and a long-tenured family member; board independence safeguards include a Lead Independent Director and regular executive sessions without non-independent directors . Family governance ties (father/son with CEO; brother with former executive) warrant ongoing monitoring of independence in oversight .
Performance & Track Record
| Metric | 2020 | 2021 | 2022 | 2023 | 2024 |
|---|---|---|---|---|---|
| Total Shareholder Return (fixed $100) | 103.49 | 115.42 | 121.89 | 102.51 | 128.00 |
| Net Income (USD thousands) | 353,885 | 540,590 | 500,020 | 485,177 | 534,401 |
| “Actual Revenue” (USD thousands) | 1,346,746 | 1,425,876 | 1,509,226 | 1,586,159 | 1,663,622 |
Say-on-Pay and benchmarking:
- Say-on-Pay approval: 91% for 2024 compensation .
- Compensation benchmarking: Willis Towers Watson survey and NEO Peer Group applied in determining NEO compensation; peer companies include UMB Financial, Prosperity Bancshares, South State, Bank OZK, Wintrust, and others (19 banks) .
Related-Party Transactions & Risk Indicators
- Tower Properties: Kemper family beneficially owns ~66% of Tower; CBSH paid Tower for parking, management, and construction services in 2024 ($16k leasing agent fees, $125k parking, $165k construction management, $2,342k building management); contracts terminated effective Dec 31, 2024 .
- Family compensation ties: 2024 payments to David W. Kemper (salary/other compensation $443,936; bonus $165,800; equity awards $249,928); other family members received retirement benefits and salary at affiliates .
- Section 16(a): A delinquent Form 4 was filed for David W. Kemper to report a restricted stock award .
- Anti-hedging/pricing policies: Hedging prohibited; repricing of underwater options prohibited; excise tax gross-up limited and not offered to employees after 2012 unless previously committed .
Vesting Schedules & Insider Selling Pressure
- Upcoming vesting specifics for David W. Kemper are not disclosed. Company-wide equity vesting for executives: current-year restricted stock vest at four years; long-term restricted stock at five years; SARs vest 25% per year over four years; change-of-control acceleration applies .
- Note: A delinquent Form 4 filed for a restricted stock award suggests equity activity but does not alone indicate selling pressure .
Compensation Structure Analysis
- Mix and risk: Executive program emphasizes variable pay via equity and annual incentives; anti-hedging and clawback policies strengthen alignment .
- Metric rigor: 2024 metrics include Net Income, PPNR, Revenue, and ROE vs 19 peers, with funding up to 164% of target—balanced across profitability and peer-relative returns .
- Governance mitigants: Separation of CEO and Chair roles since 2018 and Lead Independent Director reduce dual-role risk; however, family ties and related-party history warrant continued scrutiny .
Investment Implications
- Alignment: High insider ownership (1.2% beneficial) and executive equity awards, plus anti-hedging/clawback policies, support pay-for-performance alignment and long-term orientation .
- Governance risk: Family relationships (Exec Chairman is father of CEO) and prior related-party transactions with Tower Properties (terminated in 2024) present governance optics and potential conflict risks; board structure and termination of Tower contracts are positives but require ongoing monitoring .
- Performance trend: TSR and Actual Revenue increased from 2020 to 2024, with 2023 softness consistent with sector dynamics; Say-on-Pay support at 91% signals shareholder approval of compensation design .
- Event sensitivity: Equity vesting acceleration upon change-of-control and pro rata vesting on retirement/death/disability could create transaction-related overhangs; lack of disclosed personal vesting schedule for David limits visibility into near-term selling pressure .