Steven Karol
CARPENTER TECHNOLOGYAbout Steven E. Karol
Independent director of Carpenter Technology (CRS) since 2012; age 71. Managing Partner and founder of Watermill Group and Chairman/CEO of HMK Enterprises, Inc., with deep experience in strategic and operational management in specialty materials and industrials. Board credentials emphasize CEO experience, industry knowledge, strategy, and finance, and he currently chairs CRS’s Strategy Committee and serves on Corporate Governance and Human Capital Management .
Past Roles
| Organization | Role | Tenure | Committees/Impact |
|---|---|---|---|
| Latrobe Specialty Metals, Inc. | Director | 2006–Feb 2012 | Manufacturer of high‑performance materials; Latrobe was acquired by Carpenter in Feb 2012; industry expertise and prior oversight align with CRS strategy . |
| StockerYale | Director; Audit Committee Chair | Not disclosed | Oversight of financial reporting and controls (audit chair) . |
| Mooney Aircraft Company | Chairman of the Board | Not disclosed | Strategic leadership in aerospace manufacturing . |
| Inter‑Tel Corp.; Intelligent Energy Limited; Superior Tubes; Fine Tubes; Jeepers! Inc. | Director | Not disclosed | Board oversight across technology and advanced materials businesses . |
External Roles
| Organization | Role | Notes |
|---|---|---|
| Watermill Group | Managing Partner (founder) | Private investment firm focused on strategic/operational management; sits on boards of Watermill portfolio companies (Cooper and Turner LTD., Beck Industries, Weston Industries, Musser Lumber Company, ENBI Global, Inc.) . |
| HMK Enterprises, Inc. | Chairman & CEO | Privately held investment company . |
| The Walter Group | Board of Advisors | Advisory role . |
| YPO‑Gold | Member; prior leadership incl. International President (1998–1999) | Governance and leadership roles (1991–2001), including Chairman of Strategic Planning . |
| Chief Executives Organization | International Vice President of Education; Board & Executive Committee member | Executive education leadership . |
| Tufts University | Trustee; 2009 Distinguished Service Award | Higher education governance . |
| Vermont Academy | Past Chairman of Board of Trustees; Condit Cup awardee | Non‑profit governance . |
| National Brain Tumor Society | Director Emeritus | Non‑profit board experience . |
| Boston Symphony Orchestra; Boston Ballet | Former Board of Overseers; Trustee Emeritus | Cultural institution governance . |
Board Governance
- Independence: All non‑management directors qualify as independent under SEC/NYSE rules; Karol is an independent director .
- Committee assignments: Strategy (Chair); Corporate Governance; Human Capital Management; all committee members independent (except CEO on Strategy) .
- Attendance and engagement:
- 36 total Board/committee meetings in FY2025; independent executive sessions held 5 times .
- Directors attended all Board meetings and 99% of committee meetings in FY2025; average director attendance 99% .
- Annual Meeting participation is expected and tracked; most directors attended prior year’s meeting .
- Board leadership: Roles of Chair/CEO combined effective Oct 7, 2025, with Stephen M. Ward, Jr. appointed Lead Independent Director to enhance oversight and independent sessions .
Fixed Compensation (Director)
| Component (FY2025) | Amount ($) | Detail |
|---|---|---|
| Cash fees (retainer + chair fees) | 90,000 | Annual retainer paid 50% cash/50% stock units; Strategy Committee chair retainer $15,000 is part of cash total . |
| Stock awards (stock units) | 135,075 | Granted Oct 8, 2024; includes retainer stock units ($75,042) + non‑retainer stock units ($60,033) per program design . |
| Option awards | 35,075 | Annual award (438 options) on Oct 8, 2024; ten‑year term; vests fully on first anniversary; no dividend equivalents . |
| Dividend equivalents/other | 31,931 | Dividend equivalents credited on stock units . |
| Total | 292,081 | CEO is not compensated for Board service . |
Program features:
- Annual director compensation elements: Retainer $150,000 (50% cash/50% stock units), option grant target $35,000, non‑retainer stock units $60,000; committee chair retainers: Strategy $15,000; Audit/Finance $25,000; HCM $17,500; Corporate Governance and Science/Tech/Sustainability $15,000 .
- Deferral elections allowed for cash/stock units; stock units accrue dividend equivalents; no dividends on options .
Performance Compensation (Director)
Directors are not subject to performance‑based pay metrics at CRS; equity awards are time‑based and vest per schedule (initial option grants vest in 4 equal annual installments; annual options and stock units vest fully on first anniversary). Change‑of‑control accelerates vesting of stock units and options; options retain original term; death/disability accelerates vesting .
Other Directorships & Interlocks
| Category | Detail |
|---|---|
| Current public company directorships | None disclosed for Karol . |
| Prior public boards | Lenovo ecosystem tangentially referenced elsewhere in proxy for other directors; for Karol: Inter‑Tel Corp., StockerYale (audit chair), Intelligent Energy Limited; Fine Tubes; Superior Tubes; Mooney Aircraft Company . |
| Potential interlocks/conflicts | Served as Director of Latrobe Specialty Metals (partially owned by Watermill Group) prior to its acquisition by Carpenter in Feb 2012; strengthens industry expertise but is a historical relationship . |
| Related-party transactions | None in FY2025; company conducts annual D&O questionnaires and Audit/Finance Committee approval for any related‑party items . |
Expertise & Qualifications
- CEO experience; key industry knowledge in specialty materials; strategic and financial experience. Proxy lists Karol’s qualifications explicitly as: Chief Executive Officer, Key Industry Knowledge, Strategic Experience, Financial Experience .
Equity Ownership
| Ownership Detail (as of Aug 8, 2025) | Amount | Notes |
|---|---|---|
| Beneficially owned shares | 434,971 | Includes shares with shared voting/investment over 10,000 shares . |
| Director stock units (deferred equity) | 40,431 | Stock units payable in shares upon separation or elected date; accrue dividend equivalents . |
| Options outstanding | 26,528 | Ten‑year term; annual grants and prior grants outstanding . |
| Options exercisable within 60 days | 26,090 | Exercisable count per proxy . |
| Ownership as % of outstanding shares | 0.9% | Based on 49,850,095 shares outstanding . |
| Affiliate holdings | SEK Limited: 213,381; HMK Enterprises Inc.: 5,500 | Entities with which Karol is affiliated . |
| Stock ownership guideline (Directors) | 6x annual cash retainer; all current non‑employee directors satisfy or are on track within 5‑year phase‑in . | |
| Hedging/pledging | Company prohibits hedging/pledging for NEOs; director policy not explicitly stated; no pledging disclosure for Karol . |
Governance Assessment
- Board effectiveness: Karol chairs Strategy—central to oversight of capital allocation, growth initiatives, and alignment of annual plans with corporate strategy. His industry and CEO background support depth on strategic matters .
- Independence and attendance: Independent status, high Board/committee attendance (average 99%), and engagement via executive sessions mitigate governance risk and support investor confidence .
- Compensation alignment: Director pay structure balances cash and equity with meaningful stock unit exposure, deferrals, and robust stock ownership guidelines (6x cash retainer), aligning interests with shareholders. No performance metrics for directors, but time‑based equity vests and change‑of‑control terms are standard; no excessive perquisites; no option repricing .
- Conflicts/related parties: Historical interlock via Watermill Group and Latrobe before CRS’s 2012 acquisition; FY2025 disclosure indicates no related‑party transactions—reduces immediate conflict risk .
- Shareholder signals: Advisory say‑on‑pay support remains strong (approx. 99% in 2024; 2025 vote: 40.7M for, 1.13M against), indicating confidence in compensation governance; auditors ratified with wide margin .
Risk Indicators & RED FLAGS
- RED FLAGS: None disclosed in FY2025 for related‑party transactions; no tax gross‑ups; no option repricing; hedging/pledging by NEOs prohibited (director policy not specified). Monitor any future transactions involving Watermill or affiliated entities (SEK Limited, HMK Enterprises) for potential related‑party exposure .
- Governance mitigants: Independent Lead Director structure post‑Chair/CEO combination; independent committees; frequent executive sessions .
Say‑on‑Pay & Shareholder Feedback (Context)
- Historical approval ~99% in 2022–2024; strong 2025 advisory vote support (40,715,597 for; 1,134,561 against; 96,749 abstain; 2,304,033 broker non‑votes) reinforces investor alignment with compensation governance .