Noel Wallace
COLGATE PALMOLIVEAbout Noel Wallace
Noel Wallace is Chairman (since 2020) and President & CEO (since 2019) of Colgate-Palmolive, after joining the company in 1987 and progressing through senior global roles . Age 60, he has led a strategy focused on consistent compounded EPS growth via organic sales, efficiency, and cash flow, delivering six straight years of organic sales growth since 2019 and surpassing $20B in annual net sales in 2024 . In 2024 Colgate achieved organic sales growth of 7.4% vs. a 5.0% target and Base Business EPS of $3.60 vs. $3.37–$3.42 target; Free Cash Flow Productivity for 2022–2024 was 100.7% vs. 95% target, and $3.4B was returned to shareholders, supporting 130 years of dividends and 62 consecutive years of increases .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Colgate-Palmolive | President & COO | 2018–2019 | Led all operating units globally; executed growth and efficiency initiatives |
| Colgate-Palmolive | COO, Global Innovation & Growth and Hill’s Pet Nutrition | 2016–2018 | Drove science-led innovation and pet nutrition growth platforms |
| Colgate-Palmolive | President, Latin America | 2013–2016 | Expanded penetration and growth across key emerging markets |
| Colgate-Palmolive | President, North America & Global Sustainability | 2010–2013 | Advanced brand health and sustainability initiatives |
| Colgate-Palmolive | Joined Colgate | 1987–present | 35+ years of global leadership across markets and categories |
External Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Public company boards | None currently | — | Past experience on another U.S. public company board (not specified) |
Fixed Compensation
| Metric | 2022 | 2023 | 2024 |
|---|---|---|---|
| Base Salary ($) | 1,387,500 | 1,475,000 | 1,500,000 |
| All Other Compensation ($) | 628,156 | 929,862 | 918,154 |
| CEO Pay Ratio | — | — | 314x (2024 CEO vs. median employee) |
Perquisites for Wallace are limited to personal use of car and driver, with taxes borne by the CEO .
Performance Compensation
| Component | Metric | Weighting | Target | Actual/Payout | Vesting |
|---|---|---|---|---|---|
| Annual Incentive (2024) | Base Business EPS | 80% combined with Organic Sales | $3.37–$3.42 | $3.60; payout contributed to $4,567,500 cash bonus | Paid after FY results certified |
| Annual Incentive (2024) | Organic Sales Growth | 80% combined with EPS | 5.0% | 7.4%; payout contributed to $4,567,500 cash bonus | Paid after FY results certified |
| Annual Incentive (2024) | Strategic Initiatives (Innovation, Consumer Experience, Inclusion, Sustainability) | 20% | Qualitative goals | 150% of target component | Paid after FY results certified |
| Long-Term Incentive (2024–2026 PBRSUs) | Relative Organic Sales Growth | Core | 50th percentile vs. Comparison Group | Tracking between target and maximum based on 2024 to date | Vest in 2027 if earned |
| Long-Term Incentive (2024–2026 PBRSUs) | Relative Base Business Net Income Growth | Core | 50th percentile vs. Comparison Group | Tracking between target and maximum based on 2024 to date | Vest in 2027 if earned |
| Long-Term Incentive (2024–2026 PBRSUs) | Free Cash Flow Productivity | Core | 95% | Company achieved 100.7% for 2022–2024 cycle used in compensation | Vest in 2027 if earned |
| Long-Term Incentive Modifier | Relative TSR | ±25% | Based on Comparison Group | Applies at vest | Vest in 2027 if earned |
Additional compensation governance: no executive employment agreements; double-trigger change-in-control vesting; no hedging/pledging; stringent clawbacks; no options repricing/backdating/springloading .
Equity Ownership & Alignment
| Ownership Detail | Amount |
|---|---|
| Directly Owned Shares | 331,671 |
| Shares via Savings & Investment Plan trustee | 53,167 |
| Exercisable Options (within 60 days of Mar 10, 2025) | 1,388,637 |
| Trust Holdings | 335 (Noel R. Wallace 2012 GST Trust); 52,000 (N.R.W. Irrevocable Trust) |
| Ownership as % of outstanding | <0.25% (each person); directors/executives as group 0.41% |
| CEO Stock Ownership Guideline | 8x salary; officers must retain 100% net after-tax RSU shares until in compliance; all Named Officers in compliance |
| Hedging/Pledging | Prohibited; all Named Officers compliant in 2024 |
| In-the-Money Value of Options at FY-end 2024 | Exercisable $21,104,571; Unexercisable $3,875,565 |
Vesting Schedules and Potential Selling Pressure
- RSUs vest in equal annual installments over three years; options vest in equal annual installments over three years; option term is eight years .
- Specific scheduled vesting for Wallace:
- Options vesting counts across grants: 9/9/25 107,637; 9/12/25 48,565; 9/13/25 68,838; 9/12/26 48,565; 9/13/26 68,839; 9/12/27 48,566 .
- RSUs/PBRSUs scheduled: PBRSUs 96,041 on 2/13/25; RSUs 5,978 (9/12/25), 9,635 (9/13/25), 6,933 (9/12/26), 9,636 (9/13/26), 6,934 (9/12/27) .
- Retention mitigants: officers must retain 100% of net after-tax RSU shares until ownership guideline met; hedging/pledging prohibited, reducing forced selling risk .
Employment Terms
| Provision | Details |
|---|---|
| Employment Agreement | None; no guaranteed salary/bonus/levels of equity |
| Severance Plan (Change-in-Control) | Double-trigger; if terminated without cause or for adverse change in employment conditions within 2 years post-CIC, lump sum equal to 18 or 24 months of base salary + avg last three annual bonuses, plus company contributions and continued benefits; includes pro-rated bonus within 30 days post-CIC; non-compete of one year required |
| CIC Definition | 30%+ share acquisition; board majority turnover; major reorganization/asset sale; or liquidation/dissolution (with exceptions) |
| Equity under CIC | Options become exercisable; unvested RSUs/PBRSUs are earned in full and accelerated upon CIC + Qualified Termination, with PBRSUs deemed earned at greater of target or performance to date |
| Involuntary Termination (no CIC) | Lump sum 12–24 months base salary; continued medical/dental (and life for CFO until eligible); equity receives retirement treatment if retirement-eligible; benefits enhancements for Named Officers removed in 2025 |
| Clawbacks | Mandatory recoupment for restatements; discretionary clawback for code violations; equity awards include non-compete/non-solicit/non-interference |
| Tax Gross-ups | None on perquisites or severance |
| Plan Renewal | Severance Plan renewed Sept 2023 for initial 3-year term; auto-extends annually unless Board decides otherwise |
Potential Payments (as of 12/31/2024, if triggered)
| Type | Change-in-Control + Qualified Termination ($) | Involuntary Termination Without Cause ($) | Death ($) | Disability ($) | Retirement ($) |
|---|---|---|---|---|---|
| Severance Payments | 10,092,500 | 3,000,000 | — | — | — |
| Annual Incentive (2024 actual) | 4,567,500 | 4,567,500 | 4,567,500 | 4,567,500 | 4,567,500 |
| Stock Options | 3,875,565 | — | 3,875,565 | 3,875,565 | — |
| RSUs | 3,556,036 | — | — | — | — |
| PBRSUs | 35,858,540 | — | — | — | — |
| Benefits | 1,675,989 | 53,527 | — | — | — |
Board Governance
- Wallace is Chairman, President and CEO; the Board argues combined roles are appropriate given dynamic environment, with robust Lead Independent Director duties and independent committees, and 9 of 10 directors are independent . Lead Director presides executive sessions at every meeting, sets agendas, liaises with management, drives evaluations and succession planning, and engages with shareholders; current Lead Director is Lorrie M. Norrington (3-year term) .
- Board and committee meeting attendance averaged 99% in 2024; independent directors met in executive sessions at each regularly scheduled meeting .
- Committee structure: Audit, Finance, NGCR, and Personnel & Organization (P&O) are 100% independent; Wallace is not on any committees .
- Independent chair proposal received 33.8% support in 2024; company maintains combined Chair/CEO with enhanced Lead Director responsibilities .
Director Service and Compensation (Wallace as director)
| Item | Detail |
|---|---|
| Board Service | Director since 2019; Chairman since 2020 |
| Board Attendance | Average 99% across directors in 2024 |
| Committee Roles | None (employee director) |
| Independence | Not independent (employee CEO); other nine nominees independent |
| Director Compensation | Wallace receives no director compensation |
Compensation Committee Analysis
- P&O Committee members (all independent): John P. Bilbrey (Chair), Steven A. Cahillane, C. Martin Harris, Kimberly A. Nelson, Brian O. Newman; no interlocks or related person transactions .
- Independent consultant FW Cook advises on design, targets, and peer groups; no conflicts; market data from Mercer, Aon Radford, WTW, Equilar .
- Say-on-pay in 2024 approved by 86.7% of votes .
Multi-Year CEO Compensation Mix and Awards
| Year | Stock Awards ($) | Option Awards ($) | Non-Equity Incentive ($) | Total ($) |
|---|---|---|---|---|
| 2022 | 4,364,655 | 4,750,006 | 3,300,150 | 14,462,406 |
| 2023 | 6,863,950 | 3,075,008 | 4,725,000 | 17,121,584 |
| 2024 | 7,893,014 | 3,300,014 | 4,567,500 | 18,234,864 |
2024 grants: PBRSUs target 62,252 shares (threshold 6,225; max 124,504; grant date fair value $5,692,945) ; RSUs 20,689 shares ($2,200,068) ; Options 145,696 (exercise price $106.34; grant date fair value $3,300,014) .
Performance & Track Record
- Strategy introduced in 2019 delivered six years of organic growth at/above 3–5% target; 2024 net sales exceeded $20B; broad-based growth across categories and divisions; strong balance sheet and cash flow supporting dividend increases for the 62nd consecutive year; $3.4B returned in 2024 .
- Pay-versus-performance disclosure shows 2024 “compensation actually paid” for CEO correlates with higher TSR; Company TSR value of an initial $100 reached $148.5 vs. peer group $125.6; net income $3,049M; organic sales growth 7.4% .
Equity Grant Policies and Ownership Guidelines
- Annual equity grants at predetermined times; no timing around MNPI; options never backdated/repriced; blackout windows around earnings for options .
- Stock ownership: CEO 8x salary; officers must retain 100% of net after-tax RSU shares until compliant; all Named Officers compliant .
Investment Implications
- Compensation alignment: High variable pay mix and rigorous annual/long-term metrics (EPS, organic growth, FCF productivity, relative performance) tightly link pay to value creation; strong clawbacks and no hedging/pledging enhance alignment .
- Vesting-driven supply: Significant scheduled RSU and option vesting over 2025–2027 could create incremental sellable shares, but retention requirements (net RSU share retention until guideline met) and anti-pledging reduce near-term selling pressure; options are already deeply in-the-money, with $21.1M exercisable value at FY-end 2024, which bears monitoring around 10b5-1 plans and blackout periods .
- Governance: Combined Chair/CEO remains a minority investor concern (33.8% support for independent chair in 2024), but robust Lead Director authority and independent committees partially mitigate; continued high say-on-pay support (86.7%) suggests broad investor acceptance of pay design .
- Change-in-control economics: Double-trigger design with substantial equity acceleration (e.g., PBRSUs $35.9M, RSUs $3.6M, options $3.9M for Wallace) implies meaningful event-driven compensation leverage; however, no employment agreements and non-compete obligations temper retention risk profiles .
Overall, Wallace’s incentives emphasize multi-year organic growth, EPS, and cash generation with peer-relative modifiers, supporting durable TSR while governance structures aim to balance combined leadership with independent oversight and strong shareholder-friendly policies .