Paul Varga
Churchill DownsAbout Paul C. Varga
Independent director of Churchill Downs Incorporated (CHDN) since 2020; age 61. Former Chairman and CEO of Brown‑Forman Corporation (global spirits) and currently Lead Independent Director at Macy’s, Inc., with deep expertise in finance, strategy, brand building, product development, marketing, distribution, and sales. The Board has determined he is independent (all directors except the CEO) .
Past Roles
| Organization | Role | Tenure | Committees/Impact |
|---|---|---|---|
| Brown‑Forman Corporation | Chairman & Chief Executive Officer | Aug 2007 – Dec 2018 | Led strategy, finance, brand building, product development, marketing, distribution, sales |
| Brown‑Forman Beverages (division) | President & Chief Executive Officer | 2003 – 2005 | Leadership and operating oversight |
| Brown‑Forman Spirits | Global Chief Marketing Officer | 2000 – 2003 | Global marketing, brand strategy |
External Roles
| Organization | Role | Tenure | Committees |
|---|---|---|---|
| Macy’s, Inc. | Lead Independent Director | Current | Compensation & Management Development; Finance |
| Brown‑Forman Corporation | Director | 2003 – Jul 2019 | Board service |
Board Governance
- Committee assignments: Audit Committee member (committee roster: Karole F. Lloyd, Chair; Daniel P. Harrington; Paul C. Varga; R. Alex Rankin, ex officio) and Compensation Committee member (chair: Harrington) .
- Independence: All directors were independent except the CEO for the most recent fiscal year .
- Attendance and engagement: In 2024, the Board met 4 times; Audit 4; Compensation 4; Nominating & Governance 2, and all incumbent directors attended at least 75% of their Board and committee meetings. Directors attended the annual meeting in 2024 .
- Retirement policy: Mandatory director retirement age 72 .
- Stock ownership guidelines: Directors must hold shares equal to 5x annual retainer; Varga meets the guideline .
Shareholder support signals:
| Vote Item | For | Withheld/Against | Abstentions | Broker Non‑Votes |
|---|---|---|---|---|
| 2024 Election of Paul C. Varga (Class I) | 61,321,823 | 2,039,040 | — | 4,933,168 |
Fixed Compensation
Director fee schedule (applies to non‑employee directors):
| Component | Amount | Notes |
|---|---|---|
| Board annual cash retainer | $75,000 | Paid quarterly in arrears |
| Meeting fees (Board/Committee) | $2,000 | Plus travel reimbursements for non‑Louisville residents |
| Equity grant (RSUs/RSAs) | $155,000 | Annual grant; RSUs/RSAs allowed at director election |
| Audit Committee – Chair / Member | $35,000 / $15,000 | Annual |
| Compensation Committee – Chair / Member | $25,000 / $12,500 | Annual |
| Nominating & Governance – Chair / Member | $20,000 / $10,000 | Annual |
| Non‑employee Board Chairman | $150,000 | Annual |
Paul Varga – realized director compensation:
| Year | Fees Earned (Cash) | Stock Awards (Grant‑date fair value) | Total |
|---|---|---|---|
| 2024 | $128,500 | $155,000 | $283,500 |
| 2023 | $138,500 | $155,000 | $293,500 |
Performance Compensation
- Annual equity grant: On April 23, 2024, each non‑employee director received RSUs or RSAs valued at $155,000 based on the closing price; RSUs/RSAs vest one year from grant, subject to continued service .
- Outstanding director equity holdings (indicative of alignment):
- As of Dec 31, 2024: Varga held 7,847 RSUs and 1,255 RSAs from director service awards .
- As of Mar 3, 2025 (record date): his beneficial ownership disclosure includes 7,871 RSUs awarded for board service and 1,259 restricted stock awards vesting within 60 days of the record date .
Director plan features and safeguards:
- Non‑employee director annual compensation limit set at $750,000 total value under the 2025 Omnibus Stock and Incentive Plan .
- No repricing of options/SARs without shareholder approval; clawback applies to awards; no dividends on unearned awards .
Other Directorships & Interlocks
| Company | Role | Potential Interlock/Conflict |
|---|---|---|
| Macy’s, Inc. | Lead Independent Director; Compensation & Management Development; Finance | No CHDN Compensation Committee interlocks or insider participation were disclosed for 2024 . |
| Brown‑Forman Corporation | Former Director | Historical role; no current interlock with CHDN committees . |
Expertise & Qualifications
- Executive leadership in consumer brands and global operations; corporate finance and strategy; brand building and marketing; distribution and sales—cited by CHDN as key qualifications .
Equity Ownership
| Holder | Beneficial Shares | % of Class | Notes |
|---|---|---|---|
| Paul C. Varga | 28,931 | * | Includes 7,871 RSUs awarded for Board service and 1,259 restricted stock awards vesting within 60 days of Mar 3, 2025; “*” denotes <0.1% . |
Ownership alignment and restrictions:
- Director ownership guideline: 5x annual retainer—Varga meets the guideline .
- Anti‑hedging policy applies to directors (hedging and monetization transactions prohibited) .
- Company states it is not aware of any pledge of Common Stock by directors in the beneficial ownership section .
Governance Assessment
- Committee effectiveness: Dual membership on Audit and Compensation places Varga at the core of financial reporting, risk oversight, and pay governance; Audit roster confirms independent composition; he is not designated an “audit committee financial expert” (experts are Harrington and Lloyd), but serves alongside them .
- Independence and attendance: Independent director status and ≥75% attendance threshold met for all directors; robust meeting cadence with executive sessions and separate chair/CEO roles support oversight quality .
- Compensation alignment: Cash retainer plus modest meeting/committee fees paired with time‑based equity (~$155k) and a formal director compensation cap ($750k) under the 2025 plan mitigate pay inflation risk; no director performance metrics or options repricing; awards subject to clawback .
- Ownership alignment: Beneficial holdings and compliance with 5x retainer guideline, anti‑hedging policy, and absence of pledging indicate alignment with shareholders and reduced risk of misaligned incentives .
- Shareholder support: Strong election support (61.3M For vs. 2.0M Withheld in 2024) and consistently high Say‑on‑Pay approval (~98% in 2023 and 2024) signal investor confidence in board oversight of compensation and strategy .
RED FLAGS and risk indicators:
- Related‑party transactions: None flagged via Compensation Committee interlocks or insider participation in 2024; continue monitoring “Certain Relationships and Related Transactions” section annually .
- Hedging/pledging: Anti‑hedging policy in place; company not aware of pledging—positive governance signals .
- Pay structure: No evidence of discretionary bonuses or equity repricing for directors; director awards are time‑vested RSUs/RSAs with an annual cap—low red‑flag risk .