Dennis Nally
About Dennis M. Nally
Independent director at Cencora (ticker: COR) since January 2020; age 72. He chairs the Audit Committee and also serves on the Compensation and Succession Planning Committee and the Executive Committee. Former Chairman of PricewaterhouseCoopers International Ltd. and former U.S. Chairman and Senior Partner of PricewaterhouseCoopers LLP; designated an audit committee financial expert by the Board. Currently a director at Morgan Stanley (NYSE: MS).
Past Roles
| Organization | Role | Tenure | Committees/Impact |
|---|---|---|---|
| PricewaterhouseCoopers International Ltd. | Chairman | 2009–2016 | Led global governance of PwC network; deep audit/controls expertise |
| PricewaterhouseCoopers LLP (U.S.) | Chairman and Senior Partner | 2002–2009 | Oversaw U.S. firm; strategic planning and audit leadership |
| PricewaterhouseCoopers LLP (U.S.) | Partner; various leadership roles (National Director of Strategic Planning; Audit and Business Advisory Services Leader; Managing Partner) | Partner since 1985; joined 1974 | Broad leadership across audit and advisory |
External Roles
| Organization | Role | Public/Private | Tenure/Notes |
|---|---|---|---|
| Morgan Stanley (NYSE: MS) | Director | Public | Current director |
| Globality, Inc. | Director | Private | Current director |
Board Governance
- Independence: Board determined Mr. Nally is independent under NYSE and SEC standards; all Audit, Compensation, and Governance Committee members are independent. No family relationships among directors/executives.
- Committees: Audit (Chair), Compensation & Succession Planning, Executive. Audit Committee held 9 meetings in fiscal 2024; all members independent.
- Audit Committee Financial Expert: Board designated Mr. Nally as an “audit committee financial expert” under Item 407(d)(5).
- Attendance/Engagement: In fiscal 2024, the Board met 16 times; each director attended at least 75% of Board and assigned committee meetings. Independent directors meet before each committee meeting and after each regular Board meeting.
- Director Retirement/Term: Directors offer to resign at the annual meeting following their 75th birthday; directors initially elected after Aug. 18, 2022 also offer to resign after 15 years.
Fixed Compensation (Director – FY 2024)
| Element | Detail | Amount/Terms |
|---|---|---|
| Fees Earned or Paid in Cash | Includes cash retainer, Audit Committee Chair fee, and any special committee retainers; Mr. Nally also took a portion in shares | $175,232; included 564 shares taken in lieu of cash retainer (shares) |
| Annual RSU Award | Time-based RSUs granted to all non-employee directors (other than Ms. Barra) | $200,162 grant date fair value |
| Audit Committee Chair Fee | Committee chair additional retainer | $25,000 |
| Special Litigation Committee (2010-era matter) | Sole member retainer for SLC formed in 2020 (dissolved after court affirmance Sept. 2024) | $50,000 (annual) |
| Program Structure | Non-employee directors receive annual cash retainer + annual RSU award; choice of cash, stock, RSUs, or deferral for retainers | Program summary; no changes in FY 2024 |
| Deferral Option | May defer retainers/RSUs into Deferred Compensation Plan; company pays admin costs | Available; distribution upon board service end per election |
- No loans are permitted to directors; corporate governance principles prohibit loans/credit extensions to directors/officers.
Performance Compensation (Director Equity – FY 2024)
| Award Type | Grant Date | Grant Date Fair Value | Vesting | Performance Metrics |
|---|---|---|---|---|
| RSUs (Director Annual) | March 12, 2024 | $200,162 (Mr. Nally) | One-year vesting from grant; settlement deferral available | None (time-based; no performance metrics) |
Director equity awards are time-based; the proxy discloses no performance metrics for non-employee director RSUs.
Other Directorships & Interlocks
- Current public board: Morgan Stanley (NYSE: MS). The Board’s independence review considered that some directors serve on boards of companies for which Cencora performs services and still determined independence; none of these directors receive consulting/advisory fees from Cencora beyond director compensation.
- Related-party exposure at Cencora is primarily with Walgreens Boots Alliance (WBA), a >5% holder and major customer; overseen under the Related Persons Transactions Policy and relevant committees (including Audit). No Nally-specific related-party transactions are disclosed.
Expertise & Qualifications
- Financial expertise with deep knowledge of financial statements, accounting principles, internal controls, and risk management (PwC global/U.S. leadership).
- Governance and risk oversight experience in highly regulated industries; audit committee financial expert.
Equity Ownership (As of FY 2024 year-end and noted dates)
| Item | Value/Status |
|---|---|
| Beneficial Ownership (11/30/2024) | 11,375 shares; “Percent of Class” indicated as “*” (<1%) |
| Outstanding RSUs (9/30/2024) | 2,041 RSUs outstanding |
| Stock Ownership Guidelines (Directors) | 5× annual cash retainer; compliance required within 5 years of board election |
| Compliance Status (as of 9/30/2024) | All non-employee directors (except WBA designee) either in compliance or within 5-year window |
| Hedging/Pledging | Prohibited for executive officers and directors |
Governance Assessment
- Strengths supporting investor confidence:
- Independent Audit Chair and designated audit committee financial expert; active committee cadence (9 Audit meetings in FY 2024).
- Clear independence determination under NYSE/SEC standards; no family relationships; robust related-person oversight.
- Aligned director pay structure with equity component; ownership guidelines (5× retainer) and anti-hedging/pledging policy enhance alignment.
- Director engagement: each director met ≥75% attendance threshold; independent director executive sessions institutionalized.
- Watch items / potential red flags to monitor:
- Special litigation oversight: Mr. Nally received a $50,000 retainer as sole member of a Special Litigation Committee (legacy matter) that was dissolved after the Delaware Supreme Court’s affirmance in Sept. 2024; while resolved, special committee fees can draw scrutiny on independence/perceived entrenchment if recurrent.
- Customer concentration/related-party environment: WBA accounted for ~$76.5B of FY 2024 revenue (~26%) and 37% of receivables; while not tied to Mr. Nally personally, oversight of these exposures is critical for the Audit Chair.
- Succession horizon: Board policy requires resignation offer following the 75th birthday; at age 72, succession planning for Audit Chair duties should be considered.
Overall, Mr. Nally’s audit leadership, independence, and financial expertise are positives for board effectiveness; continued rigorous oversight of related-party exposures and litigation legacy matters remains important.
Appendix: Program Schedules (for context)
| Committee Chair Fees (FY 2024) | Amount |
|---|---|
| Audit Committee Chair | $25,000 |
| Compliance & Risk Committee Chair | $25,000 |
| Compensation & Succession Planning Committee Chair | $20,000 |
| Finance Committee Chair | $20,000 |
| Governance, Sustainability & Corporate Responsibility Committee Chair | $20,000 |
| Lead Independent Director Compensation (FY 2024) | Amount |
|---|---|
| Annual Retainer | $125,000 |
| Annual Equity Award | $250,000 |