Lisa Cornehl
First American FinancialAbout Lisa Cornehl
Lisa W. Cornehl, 46, is Senior Vice President, Chief Legal Officer and Secretary of First American Financial (FAF). She has served as CLO since September 2021 and as Corporate Secretary since August 2022, after joining the company in 2011 and progressing through litigation and privacy leadership roles (14 years with FAF) . Company performance that influenced 2024 pay decisions: adjusted EPS rose 15.8% YoY; adjusted pretax margin reached 9.2%; adjusted ROE was 8.2%; commercial revenues grew 16% to $761 million; total revenues exceeded $6.1 billion; 1-year TSR was 0.4% (five-year 4.9%) versus S&P MidCap 400 at 13.9% (five-year 10.3%) .
Past Roles
| Organization | Role | Years | Strategic impact |
|---|---|---|---|
| First American Financial | Senior Vice President, Chief Legal Officer | Sep 2021 – present | Leads legal affairs; oversaw compliance, risk management, and governance through a challenging real estate cycle . |
| First American Financial | Corporate Secretary | Aug 2022 – present | Board governance, disclosure, and corporate secretary functions . |
| First American Financial | Chief Privacy Officer | 2018 – Jan 2023 | Enterprise privacy oversight amid growing data and cybersecurity focus . |
| First American Financial | Deputy General Counsel, Litigation | 2015 – 2021 | Managed litigation portfolio during industry cyclicality . |
| First American Financial | Senior Litigation Counsel | 2011 – 2015 | Led significant litigation matters . |
| Leading international law firm | Attorney | Prior to 2011 | Complex litigation experience carried into corporate role . |
External Roles
No external public directorships or outside roles for Ms. Cornehl are disclosed in the proxy’s Executive Officers section .
Fixed Compensation
| Metric | 2023 | 2024 | 2025 (set Feb 2025) |
|---|---|---|---|
| Base salary ($) | $420,000 | $450,000 | $460,000 |
| Target AIP cash bonus ($) | $192,500 | $297,000 | $287,500 (split rebalanced to 50/50 cash/equity) |
| Target AIP Bonus RSUs ($) | $157,000 | $243,000 | $287,500 (equal to cash) |
Notes:
- 2024 base increases reflected individual performance and market data; 2025 base set at $460,000 in renewed employment agreement .
Performance Compensation
AIP design, metrics and 2024 results (Company-wide):
- Metrics: Pretax margin (50% weight) and Return on Equity (50%) with threshold/target/max; no discretionary adjustment applied in 2024 .
- 2024 achievement: Pretax margin 9.2% (125% payout); ROE 8.2% (142%); overall payout 133% of target .
| AIP metric (2024) | Weight | Threshold | Target | Maximum | Actual | Payout |
|---|---|---|---|---|---|---|
| Pretax Margin | 50% | 6.0% | 8.5% | 11.3% | 9.2% | 125% |
| Return on Equity | 50% | 5.0% | 7.2% | 9.6% | 8.2% | 142% |
| Total | 100% | — | — | — | — | 133% |
Individual AIP outcomes (Lisa W. Cornehl):
| Component | 2023 | 2024 |
|---|---|---|
| Actual AIP cash bonus ($) | $138,600 | $395,010 (133% × $297,000) |
| Actual AIP Bonus RSUs ($) | $113,400 | $323,190 (133% × $243,000) |
Long-Term Incentive (LTI) awards:
- Structure: 50% time-vested RSUs (3-year vest), 50% PRSUs tied to 3-year relative TSR vs S&P MidCap 400 (0–200% payout; 25th=50%, 50th=100%, 75th+=200%), service requirement through year 3; retirement, death/disability, and without-cause termination have specified treatments .
- 2025 grants (for 2024 performance): $275,000 LTI RSUs; $275,000 target LTI PRSUs (grant date fair value for PRSUs: $396,701) .
- 2022 PRSU vesting (2012–2024 cycle) certified at 76% based on 38th percentile rTSR; Cornehl earned 585 shares vs 697 target (plus dividend equivalents) .
| LTI element | 2024 grant (for 2023 perf) | 2025 grant (for 2024 perf) |
|---|---|---|
| LTI RSUs ($) | — (see 2024 detailed tables) | $275,000 |
| LTI PRSUs target ($) | — (see 2024 detailed tables) | $275,000 (grant-date fair value $396,701) |
| PRSU payout grid | 25th=50%; 50th=100%; ≥75th=200% | 25th=50%; 50th=100%; ≥75th=200% |
| 2022 PRSU outcome | 76% of target; earned 585 shares | — |
Equity Ownership & Alignment
- Beneficial ownership: 7,635 FAF common shares as of record date; none of the executives (including Ms. Cornehl) had rights to acquire shares within 60 days .
- Outstanding equity awards (12/31/2024):
- Unvested RSUs: 158 (2/18/2021); 1,726 (2/22/2022); 3,231 (2/16/2023; market value $201,744); 6,976 (2/22/2024; market value $435,581) .
- PRSUs outstanding (numbers shown per SEC rules): 7,030 (2023 grant, maximum count; market value $438,953); 4,941 (2024 grant, target count; market value $308,516) .
- Ownership guidelines: Executives must hold 3× base salary if salary ≥$500k, otherwise 1× base salary; all executive officers meet or exceed guidelines .
- Pledging/hedging: Prohibited; executives also barred from margin accounts and must comply with robust clawback and insider-trading pre-clearance (all transactions require pre-approval by the Chief Legal Officer or a designee) .
- Options: Company has not been granting options; outstanding options as of Feb 25, 2025 were “—”; equity program uses RSUs/PRSUs .
Vesting mechanics and potential selling pressure:
- Bonus RSUs and LTI RSUs granted in/after 2023 vest 33 1/3% annually over three years; 2024 and 2025 Bonus RSUs include a performance gate (Company net income ≥$25 million in year of grant; met for 2024) .
- LTI PRSUs vest after 3-year rTSR performance period with service condition; 2025 cycle runs Jan 1, 2025–Dec 31, 2027 .
Employment Terms
- Employment agreement: Renewed in 2025; term through December 31, 2027; minimum base salary set at $460,000; Committee retains discretion on bonuses and LTI awards. Agreements include non-solicitation and confidentiality covenants (subject to legal compliance carve-outs) and define “cause” with specific triggers (e.g., embezzlement, willful breach, felony) .
- Severance (outside change-in-control): If terminated without cause, cash severance equals 2×(base salary + second-largest of prior three bonuses), paid half in 12 monthly installments and half at 12 months, contingent on a release and covenant compliance .
- Change-in-control (CIC) protections: Upon qualifying termination within 36 months of a CIC, lump-sum benefits include (i) 2× base salary and 2× target annual bonus, (ii) pro-rated target bonus for the year of termination, and (iii) 24 months of benefit continuation (cutback applies to avoid excise tax). Award agreements do not automatically accelerate on Board-approved CIC; acceleration applies if CIC not approved by Board; PRSUs measured to CIC date at actual performance .
- Potential payments (Lisa W. Cornehl; as of 12/31/2024):
- Without cause (no CIC): Severance $1,404,000; accelerated equity (per plan rules) $1,025,855; total $2,429,855 .
- CIC with termination: Severance $1,980,000; pro-rata target bonus $540,000; accelerated equity $1,331,096; benefit continuation $46,106; total $3,897,202 .
Other benefits, risk controls, and retirement:
- Clawback: NYSE Rule 303A.14-compliant policy to recoup excess incentive comp for the three full fiscal years prior to a required restatement; additional misconduct-based forfeiture rights under plan documents .
- Anti-hedging/pledging: Prohibited for executives and directors; pre-clearance required by CLO or designee for any transactions .
- SERP/Deferred comp: Ms. Cornehl is not a participant in the legacy Executive Supplemental Benefit Plan (SERP) and had no nonqualified deferred compensation reported for 2024 .
Compensation Structure Details (pay-for-performance signals)
| Element | Design | 2024/2025 specifics |
|---|---|---|
| AIP metrics | 50% Pretax Margin; 50% ROE; linear payout 50–200% of target; ±30pp Committee discretion (not used in 2024) . | 2024 payout: 133% based on 9.2% adjusted pretax margin and 8.2% adjusted ROE . |
| Bonus RSUs | Portion of AIP paid in 3-year vesting RSUs; 2024–2025 grants subject to net income ≥$25m gate (met) . | 2024 actual $323,190; 2025 target $287,500 . |
| LTI RSUs | Time-based (3-year ratable vest); supports retention . | 2025 grant $275,000 . |
| LTI PRSUs | 3-year rTSR vs S&P MidCap 400; 0–200% payout; service condition through year 3; specified retirement/termination treatment . | 2025 grant $275,000 target (grant-date fair value $396,701) . |
| Peer/market use | Comparator group and survey data used; blend applied for CLO benchmarking . | Maintained program structure amid 96% Say-on-Pay support . |
Say-on-Pay & Governance Notes
- Say-on-Pay support: ~96% approval for 2023 executive compensation (2024 vote), reinforcing at-risk, performance-oriented pay mix .
- Equity plan and overhang: Company seeks to extend and add shares to its 2020 Incentive Compensation Plan; prohibits repricing and discounted options; director pay caps; recoupment provisions .
Investment Implications
- Alignment: A high proportion of Ms. Cornehl’s total comp is at-risk and equity-based (AIP Bonus RSUs + LTI RSUs/PRSUs), with performance gates and a 3-year rTSR metric that directly links value realization to stock performance versus the S&P MidCap 400 . Anti-hedging/pledging and ownership guidelines further strengthen alignment and reduce downside governance risk .
- Vesting/supply overhang: Three-year ratable RSU vesting and 3-year PRSU cycles create periodic settlement events that can add modest insider selling pressure around vest dates, but program design (performance gates and service periods) emphasizes retention and longer holding horizons .
- Retention and CIC economics: Renewed employment agreement through 2027 with 2× severance multiple outside CIC and 2× base + 2× target bonus in a double-trigger CIC scenario provides competitive retention while avoiding single-trigger acceleration (Board-approved CIC does not auto-accelerate) .
- Pay-for-performance sensitivity: 2024 AIP paid at 133% on improved adjusted profitability (pretax margin/ROE), yet multi-year PRSUs from the 2022 grant paid at 76% reflecting below-median rTSR—evidence that long-term equity payouts remain sensitive to relative stock performance .