Rejji Hayes
About Rejji Hayes
Executive Vice President and Chief Financial Officer of CMS Energy and Consumers Energy since May 1, 2017; previously CFO of ITC Holdings, senior treasury roles at ITC and Exelon, and earlier a decade in investment banking/consulting; education: MBA (Harvard Business School) and BA (Amherst College) . CMS delivered 22 consecutive years of meeting or exceeding adjusted EPS guidance through 2024; 2024 Adjusted EPS under the Annual Incentive plan was $3.34 vs $3.29 target (driving above-target cash bonus payouts) . Long-term incentives are tied 50/50 to relative TSR and relative EPS growth over three years; say‑on‑pay support was ~95% in 2024 and ~96–97% in prior years, reflecting investor alignment with the pay program .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| ITC Holdings Corp. | Chief Financial Officer | 2014–2016 | Led finance function post-transaction period; oversaw capital markets, investor relations, M&A readiness |
| ITC Holdings Corp. | VP Finance & Treasurer | 2012–2014 | Directed treasury, financing strategy and liquidity management for transmission utility platform |
| Exelon Corporation | Assistant Treasurer; Director, Corporate Finance & Financial Strategy | 2009–2012 | Developed financing strategy; executed debt/equity financings for large-cap utility |
| Various investment banks/consultancies | Financial leadership roles | ~1999–2009 | Provided strategic and corporate finance advisory services to corporates and PE firms |
External Roles
| Organization | Role | Years | Notes |
|---|---|---|---|
| Not disclosed in reviewed filings | — | — | No external public company directorships for Hayes disclosed in CMS proxy/8‑K documents reviewed |
Fixed Compensation
Multi-year compensation (as disclosed in Summary Compensation Tables):
| Metric | 2022 | 2023 | 2024 |
|---|---|---|---|
| Base Salary ($) | 768,836 | 790,000 | 810,000 |
| Stock Awards ($, grant-date fair value) | 1,721,432 | 1,936,135 | 2,082,626 |
| Non-Equity Incentive Plan Compensation ($) | 885,699 | 796,320 | 861,840 |
| Change in Pension Value/Deferred Comp Earnings ($) | — | — | — |
| All Other Compensation ($) | 210,712 | 233,154 | 256,918 |
| Total ($) | 3,586,679 | 3,755,609 | 4,011,384 |
Target annual incentive opportunity:
| Role | Target Bonus (% of Base) | Notes |
|---|---|---|
| EVP & CFO (Hayes) | 80% | Unchanged for 2024 vs 2023; AIP formula = Salary × Target % × Plan Performance Factor |
Other fixed/retirement contributions (2024):
- DCCP/Savings Plan and nonqualified plans (company-paid) for Hayes: $41,034 to Savings Plan/DCCP (includes $20,700 DCCP); $210,470 to nonqualified plans (DC SERP $182,570; DSSP match $27,900); plus life insurance $1,414 and executive physical $4,000, totaling $256,918 .
- 2024 nonqualified deferrals: DSSP executive contribution $27,900 and registrant match $27,900 (ending balance $333,445); DC SERP registrant contribution $182,570 (ending balance $1,691,148) .
Performance Compensation
Annual Incentive Plan (AIP) design and 2024 results:
| Metric | Weight | Target | Actual | Payout Achievement |
|---|---|---|---|---|
| Adjusted EPS (AIP) | 70% | $3.29 | $3.34 | 136% |
| Utility Operational Goals (People/Planet/Prosperity) | 30% | Multiple KPIs | Achieved | 124% |
| Total AIP Payout (applied to Target) | 100% | — | — | 133% |
Long-Term Incentive (LTI) program mechanics (2024 grants):
- Mix: 75% performance‑based restricted stock (PSUs) and 25% tenure‑based restricted stock (RSUs) .
- PSU performance metrics and vesting: 50% relative TSR and 50% relative LTI EPS growth vs performance peer group over three fiscal years; payout scale from 50% at 30th percentile to 200% at 90th percentile; 20‑day average prices around grant/measurement dates used for TSR .
- 2024 EPS-growth PSU grant fair value at grant: $750,015 for Hayes; max $1,500,029 at maximum achievement (other PSU/RSU components included in total stock awards) .
- No dividends on unvested PSUs; dividend equivalents accrue as additional shares subject to same vesting/performance .
2024 AIP ranges and governance levers:
- EPS AIP payout range: 17.5% to 200% of target; Utility metric range: 0.8% to 175%; Committee retains discretion to adjust payouts ± up to 20% .
- Adjusted (non‑GAAP) EPS definitions for AIP/LTI exclude specified unusual items (asset sales, accounting changes, large restructuring, etc.) .
Equity Ownership & Alignment
Beneficial ownership and guideline compliance:
| As of | Beneficially Owned Shares | Restricted Shares Included | Pledged? | Ownership Guideline | Compliance |
|---|---|---|---|---|---|
| Mar 5, 2024 | 213,061 | 110,857 | No | 3× base salary for CFO | All NEOs in compliance (12/31/2024) |
| Mar 4, 2025 | 243,104 | 111,294 | No | 3× base salary for CFO | All NEOs in compliance (12/31/2024) |
- Company policy prohibits hedging and pledging by officers/directors, further aligning interests .
- Each executive individually owns <0.5% of CMS outstanding shares; officers/directors as a group own <0.5% .
Outstanding equity awards and vesting schedule (Hayes, selected 2022–2024 grants):
| Grant Date – Vest Date | Unvested Stock (Time-based) (#) | Market Value ($) | PSU Unearned (#) | PSU Market/Payout Value ($) |
|---|---|---|---|---|
| 1/27/2022 – 1/29/2025 | 6,726 | 448,288 | — | — |
| 1/27/2022 – 1/29/2025 (time-based tranche) | 11,668 | 777,672 | — | — |
| 1/27/2022 – 3/21/2025 (PSU cycle end) | — | — | 22,162 | 1,477,097 |
| 1/26/2023 – 1/26/2026 | 7,507 | 500,342 | — | — |
| 1/26/2023 – 1/26/2026 (PSU) | — | — | 18,038 | 1,202,233 |
| 1/26/2023 – 3/26/2026 (PSU cycle end) | — | — | 24,050 | 1,602,933 |
| 1/25/2024 – 1/25/2027 | 8,856 | 590,252 | — | — |
| 1/25/2024 – 1/25/2027 (PSU) | — | — | 20,574 | 1,371,257 |
| 1/25/2024 – 3/25/2027 (PSU cycle end) | — | — | 27,432 | 1,828,343 |
Notes:
- No stock options outstanding for Hayes in the 2024 Outstanding Equity table (option columns are blank) .
- Tenure-based RSUs cliff‑vest at year 3; PSUs vest at cycle end subject to performance; pro‑rata/accelerated vesting applies on death, disability, retirement per plan/agreements .
Vesting-related selling pressure:
- Multiple vesting events in Q1 of 2025, 2026, 2027 create potential liquidity events (1/29/2025; 3/21/2025; 1/26/2026; 3/26/2026; 1/25/2027; 3/25/2027) .
Employment Terms
- Start date/role: Appointed EVP & CFO effective May 1, 2017 (age 42 at appointment); initial comp terms included $600,000 base, 70% target bonus, $775,000 cash sign‑on (with $750,000 clawback if voluntary/for cause departure before 3 years), $1,250,000 tenure‑based RSU (3‑year cliff), and eligibility for CIC and Officer Separation Agreements; 2018 LTI grant of $1,000,000 to be awarded as part of January cycle .
- No traditional employment agreements; each NEO has a Change‑in‑Control Agreement (CIC) and an Officer Separation Agreement (OS) .
- Double‑trigger for accelerated vesting under CIC; no tax gross‑ups in separation/CIC agreements per program design .
- Clawbacks: in place for AIP and LTI; Stock Plan contains clawback provisions .
Potential payments upon termination/CIC (Hayes, using 12/31/2024 values; CMS YE price $66.65):
| Scenario | Key Cash Multiples | Equity/Benefits | Total ($) |
|---|---|---|---|
| Termination without cause (OS) | 1.5× 2024 base salary = $1,215,000 | Unvested RS awards $4,133,766; DC SERP vesting of $1,268,593 | 6,617,359 |
| Change‑in‑control (CIC) | 2× base = $1,620,000; 2× target incentive = $1,296,000; pro‑rata incentive $648,000 | Unvested RS awards $4,694,048; DC SERP vesting $1,803,193; Medical coverage $43,167 | 10,104,408 |
Additional CIC-related retirement plan contributions:
- In a CIC, Hayes receives an additional DC SERP contribution equal to 15% of his salary and incentive‑based CIC payment (higher than the 10% provided to certain other NEOs) .
Retirement and pension plans:
- Hayes participates in Defined Contribution Company Plan (DCCP) and DC SERP; receives 6% DCCP contribution and 10% of earnings below the IRC limit, 15% above the limit, and 15% of AIP award into DC SERP (vesting rules apply) .
- Not a participant in the Cash Balance defined benefit plan (CEO only) .
Investment Implications
- Pay-for-performance alignment: 77% of Hayes’ 2024 total direct compensation was variable, with 76% of variable pay in long-term equity; 75% of LTI is performance‑based (TSR and EPS growth), which tightly ties realizable pay to multi‑year relative performance .
- Incentive calibration: AIP delivered 133% of target in 2024 on $3.34 vs $3.29 EPS target and strong utility KPIs, suggesting appropriately stretch goals with partial operational balance; presence of clawbacks and non‑GAAP guardrails reduces risk of windfalls from unusual items .
- Retention and overhang: Meaningful unvested PSU/RSU tranches with staggered vest dates through 2027 plus DC SERP vesting features support retention; OS/CIC structures (1.5×/2× cash with double‑trigger and no tax gross‑ups) are shareholder‑friendly relative to utility peers .
- Insider selling/pledging risk: Company prohibits hedging/pledging; no pledged shares reported for Hayes; while several vesting events occur in Q1 each year (potential supply), policy constraints and ownership guidelines (3× salary; in compliance) mitigate misalignment risk .
- Governance sentiment: Strong say‑on‑pay support (~95–97%) over multiple years indicates investor acceptance of the program design and execution under CFO leadership during consistent EPS delivery streaks .
Overall, Hayes’ package is heavily equity‑weighted with robust performance linkages and standard utility‑peer protections (double‑trigger CIC, no gross‑ups, clawbacks). Anticipate periodic vest‑related liquidity around late‑Q1; absent adverse Form 4 trends, alignment/retention risk appears low given unvested balances and ownership compliance .