Ajita Rajendra
DONALDSON CoAbout Ajita G. Rajendra
Ajita G. Rajendra (age 73) is an independent director of Donaldson Company, Inc. (DCI) serving since 2010; he currently chairs the Human Resources Committee. He is the former Executive Chairman (2018–2020), CEO (2013–2018), Chairman (2014–2018), and President (2011–2018) of A. O. Smith, with a B.S. in Chemical Engineering (IIT Madras) and an MBA (Carnegie Mellon). Beneficial ownership at DCI totals 89,078 shares, including deferred stock units and exercisable options as detailed below.
Past Roles
| Organization | Role | Tenure | Committees/Impact |
|---|---|---|---|
| A. O. Smith Corporation | Executive Chairman | 2018–2020 | Led strategic oversight post-CEO tenure; manufacturing sector expertise applied to board governance. |
| A. O. Smith Corporation | Chairman; Chief Executive Officer; President | Chairman 2014–2018; CEO 2013–2018; President 2011–2018 | Drove global operations and M&A; consumer durables and industrial product experience. |
| A. O. Smith Corporation | EVP; COO; President, Water Products Company | Roles from 2005–2013 (EVP 2006–2011; COO 2011–2013) | Negotiated acquisitions and joint ventures; operational leadership. |
External Roles
| Organization | Role | Tenure | Committees/Impact |
|---|---|---|---|
| The Timken Company | Director | Current | Public company board service; Timken is included in DCI’s executive compensation benchmarking peer group (see interlocks). |
| A. O. Smith Corporation | Director | 2011–2020 | Prior directorship aligned with former executive leadership. |
Board Governance
- Independence: The board determined all directors and nominees are independent except the CEO/Chairman (Tod Carpenter). Ajita is independent.
- Leadership and roles: Ajita chairs the Human Resources Committee; Lead Independent Director is Christopher M. Hilger (effective Aug 1, 2025). Executive sessions occur at every Board and Committee meeting.
- Attendance: Each director attended at least 75% of aggregate Board and Committee meetings; directors are expected to attend the annual meeting, and all did last year.
| FY2025 Board/Committee | Meetings Held | Ajita G. Rajendra Membership | Attendance Status |
|---|---|---|---|
| Board of Directors | 6 | Member | ≥75% for all directors |
| Human Resources Committee | 5 | Chair | ≥75% for all directors |
| Audit Committee | 8 | Not a member | — |
| Corporate Governance Committee | 2 | Not a member | — |
- Governance policies: Directors are limited to five public company boards (two if serving as a sitting CEO), prohibition on hedging/pledging company stock, and director re-nomination limits at age 75 or 18 years of service unless the Board approves an exception.
Fixed Compensation
Program elements (non-employee directors):
- Annual Board retainer: $90,000 (increased April 2024). HR Committee Chair retainer: $15,000. Lead Director retainer: $30,000.
- Annual equity value: $170,000 effective January 2025, split 50% stock options and 50% RSUs.
Multi-year compensation (Ajita G. Rajendra):
| Component ($) | FY2023 | FY2024 | FY2025 |
|---|---|---|---|
| Fees Earned or Paid in Cash | 86,250 | 97,500 | 105,000 |
| Stock Awards (RSUs/Deferred Stock) | 76,700 | 77,748 | 87,477 |
| Option Awards (grant-date fair value) | 74,669 | 75,933 | 85,962 |
| Total | 237,619 | 251,181 | 278,439 |
Performance Compensation
Directors do not receive performance-conditioned equity; grants are time-based:
- RSUs: Represent 50% of annual equity; number determined by grant-date closing price; dividend equivalents accrue; cliff vest 100% on first anniversary of grant date. Ajita had 1,311 RSUs outstanding as of July 31, 2025.
- Stock options: Represent 50% of annual equity; 10-year term; vest 1/3 annually over 3 years; exercise price = closing market price on grant date. Ajita had 3,900 options granted on Jan 2, 2025 (same award to all non-employee directors).
Grant and outstanding awards (as of July 31, 2025):
| Award | Quantity | Terms |
|---|---|---|
| RSUs Outstanding | 1,311 | Cliff vest 1 year; dividend equivalents accrue. |
| Options Outstanding (Exercisable) | 46,401 | 10-year term; standard time-based vesting. |
| Options Outstanding (Unexercisable) | 7,699 | Vests ratably over three years. |
| Deferred Stock Awards | 20,947 | Deferred stock account with dividend credits. |
HR Committee (chaired by Ajita) – officer incentive metrics (governance signal):
| Fiscal 2025 Measure | Weight | Threshold | Target | Maximum | Actual | Actual as % of Target |
|---|---|---|---|---|---|---|
| Company Net Sales | 30% | $3.188B | $3.751B | $4.313B | $3.691B | 98.41% |
| Company Diluted EPS – Incentive | 50% | $3.10 | $3.65 | $4.20 | $3.68 (excl. specified adjustments) | 100.82% |
| Company ROI – Incentive | 20% | 16.9% | 19.9% | 22.9% | 19.8% (with approved adjustments) | 99.50% |
- Clawbacks: Mandatory recovery policy for incentive-based compensation following restatements; supplemental recovery for misconduct.
- Say-on-Pay: 2024 vote ~95% approval, reinforcing pay-for-performance approach overseen by HR Committee.
Other Directorships & Interlocks
| Company | Relationship | Interlock/Exposure |
|---|---|---|
| The Timken Company (TKR) | Ajita is a director | Timken is included in DCI’s compensation benchmarking peer group, while Ajita chairs HR Committee—an interlock to monitor for pay benchmarking independence; WTW serves as independent consultant. |
| A. O. Smith Corporation | Former director (2011–2020) | No current interlock disclosed with DCI transactions. |
Expertise & Qualifications
- Extensive manufacturing and industrial products leadership; experience in global operations, acquisitions, and joint ventures.
- Technical background in chemical engineering and advanced business training (MBA).
- HR Committee chair experience overseeing executive compensation strategy, risk analysis, succession planning, and human capital/culture.
Equity Ownership
| Ownership Detail | Amount | Notes |
|---|---|---|
| Total Beneficial Ownership | 89,078 shares (<1% of class) | Includes exercisable options within 60 days and eligible RSUs; not subject to pledge. |
| Deferred Stock Units included | 21,024 | Held in director deferred stock account trust with pass-through voting. |
| RSUs & Exercisable Options included | 46,401 (exercisable options) | RSUs vesting within 60 days would be included; Ajita’s RSUs vest after fiscal year-end, so count reflects options. |
| RSUs Outstanding | 1,311 | Cliff vest 1 year from grant; dividend equivalents. |
| Stock Ownership Guideline | ≥$450,000 value; 5-year compliance window | All non-employee directors with ≥5 years met guidelines as of FY2025 (Ajita has met). |
| Hedging/Pledging | Prohibited for directors | Strong alignment policy; margin accounts/pledges prohibited. |
Governance Assessment
- Positives
- Independent director with deep industrial leadership; chairs HR Committee, which uses an independent consultant (WTW) and balanced financial metrics (Net Sales, EPS, ROI) for officer incentives.
- Strong shareholder support on Say-on-Pay (~95% in 2024) and robust clawback policies enhance confidence.
- Ownership alignment: meets stock ownership guidelines; significant equity exposure via options and deferred stock; hedging/pledging prohibited.
- Attendance and engagement: ≥75% attendance, executive sessions each meeting, and clear committee responsibilities.
- Watch items / RED FLAGS
- Peer group interlock: Ajita sits on Timken’s board while Timken is in DCI’s compensation peer group; continued reliance on independent consultant and HR Committee process mitigates, but monitor for pay inflation risk.
- Board refresh limits: Directors generally may not be re-nominated after age 75 or 18 years of service unless an exception is approved—Ajita is 73 with ~15 years of service, so succession planning and potential transition timing should be monitored.
- No related-party transactions disclosed involving Ajita; board-reviewed relationships with companies tied to other directors were below materiality thresholds.
Overall, Ajita’s HR Committee leadership, independence, and alignment policies support governance quality, with the Timken peer-group interlock and upcoming age/service thresholds as the main areas to monitor for investor confidence.