Carlton Highsmith
Director at KEY
Board
About Carlton L. Highsmith
Independent director of KeyCorp since 2016; age 73. Founder, CEO, and Chairman of The Specialized Packaging Group, which he grew into a leading North American designer and manufacturer of paperboard packaging prior to its 2009 merger with PaperWorks Industries. Prior bank board experience at NewAlliance Bancshares (2006–2011) and First Niagara (2011–2016). Current KEY board roles include membership on the Compensation & Organization Committee and Technology Committee; he is an independent director under NYSE and KeyCorp standards .
Past Roles
| Organization | Role | Tenure | Committees/Impact |
|---|---|---|---|
| The Specialized Packaging Group (SPG) | Founder, CEO, Chairman | Through 2009 | Led and actively managed three acquisitions (Lawson Mardon Carton NA in 1998; Focus Packaging in 2003; Packaging Machinery Service in 2003); merged with PaperWorks Industries in 2009 . |
| First Niagara | Director | 2011–2016 | Served on Governance/Nominating and Audit Committees . |
| NewAlliance Bancshares | Director | 2006–2011 | Board member before acquisition by First Niagara . |
External Roles
| Organization | Role | Tenure/Notes |
|---|---|---|
| Quinnipiac University | Vice Chairman, Board of Trustees | Current . |
| Yale New Haven Health System | Trustee | Current . |
| Connecticut Center for Arts & Technology (ConnCAT) | Chairman | Social entrepreneur; helped attract >$100 million in philanthropic capital over last 10 years . |
| Connecticut Community Outreach Revitalization Program (ConnCORP) | Board Chair | Social entrepreneur; workforce and entrepreneurship programs . |
Board Governance
- Independence: The Board determined all directors other than the CEO are independent; this includes Mr. Highsmith .
- Committees and service:
- Compensation & Organization Committee member; appointed effective July 1, 2024 (Chair: Todd J. Vasos). Committee met 8 times in 2024 .
- Technology Committee member; appointed effective July 1, 2024 (Chair: H. James Dallas). Committee met 5 times in 2024 .
- Prior Risk Committee member until July 1, 2024; Risk Committee met 13 times in 2024 .
- Attendance and engagement:
- Board held 7 meetings in 2024; independent directors met in executive session at every regular Board meeting .
- Approximately 98% average director attendance across Board and committee meetings in 2024; no director attended less than 75% .
- Directors are expected to attend Annual Meetings, and all standing for election attended the 2024 Annual Meeting .
- Lead Independent Director: Alexander M. Cutler with extensive responsibilities (agenda/materials approval, shareholder engagement, committee coordination) .
Fixed Compensation
| Element (2024) | Amount | Notes |
|---|---|---|
| Fees earned in cash (Highsmith) | $107,500 | Includes base retainer and applicable committee member fees; Risk Committee member fees applied for service through July 1, 2024 . |
| Standard cash retainer (program) | $100,000 | 2024 director base cash retainer; increased to $105,000 in 2025 . |
| Risk Committee member fee (program) | $15,000 | Annual fee for Risk Committee members; other committee member fees not listed beyond Audit/Risk; chair fees separately disclosed . |
Performance Compensation
| Equity Component | Amount/Units | Grant Details | Settlement/Deferral |
|---|---|---|---|
| Stock awards (Highsmith, 2024) | $139,987 | Annual grant of 9,283 fully vested deferred shares on May 9, 2024 (rounded down to nearest whole share at fair value of $140,000 for program) . | Minimum 3-year deferral; paid 50% in shares and 50% in cash at end of deferral (accelerated upon separation); directors may further defer, in which case 100% paid in shares . |
Directors at KeyCorp are compensated via cash retainers and deferred stock units; there are no performance metrics tied to director compensation (performance design applies to executive officers). Equity grants and deferral mechanics are as described above .
Other Directorships & Interlocks
- Current public company boards: None disclosed for Mr. Highsmith in the 2025 proxy; prior public boards include First Niagara and NewAlliance Bancshares .
- Compensation Committee interlocks: During 2024, Compensation Committee members (including Highsmith, from July 1, 2024) were independent; no member was a current/former officer or had relationships requiring related-party disclosure; no executive officer of KeyCorp served on another company’s board/compensation committee that interlocked with Key’s committee .
Expertise & Qualifications
- Skilled business strategist and experienced M&A operator with successful leadership in packaging design/engineering and manufacturing; led multiple acquisitions and a major merger .
- Significant regional bank board experience prior to joining Key; social entrepreneur and community leader with substantial philanthropic capital raised for workforce and entrepreneurship programs .
Equity Ownership
| Ownership Category (as of Mar 21, 2025) | Shares/Units | Notes |
|---|---|---|
| Common Shares (direct/indirect) | 37,864 | Direct beneficial ownership . |
| Options (exercisable within 60 days) | — | None reported . |
| Deferred Shares (payable within 60 days if separated) | 17,867 | Director deferred shares included in “Deferred Shares” column . |
| Total Beneficial Ownership | 55,731 | Sum of common and deferred shares (payable within 60 days) . |
| Other Deferred Shares Owned | — | No further deferred shares reported for Highsmith . |
- Ownership alignment safeguards:
- Director stock ownership guidelines: Non-employee directors should own Key equity with value ≥5x annual retainer and at least 1,000 directly owned shares by the fifth anniversary of initial election; Highsmith holds well above 1,000 directly-owned shares .
- Insider policy prohibits hedging and pledging of KeyCorp securities; requires pre-clearance for trades by directors .
- No director (or all directors/executives as a group) beneficially owns ≥1% of outstanding common shares .
Governance Assessment
- Board effectiveness: Highsmith brings entrepreneurial and operational expertise and prior bank board experience; current service on Compensation and Technology aligns with his talent/strategy and technology exposure, respectively .
- Independence and attendance: Independent under NYSE and company standards; Board-level attendance robust (~98% average), with executive sessions at every regular meeting—supports effective oversight .
- Compensation alignment: Director pay mix balanced—cash retainer plus deferred share grants with multi-year deferral; no performance-linked elements for directors (reduces risk of misaligned incentives) .
- Potential conflicts/related-party exposure: Board reviewed ordinary-course banking relationships for directors and found them immaterial and at arm’s-length; no transactions exceeded thresholds that would impair independence. Regulation O compliance for any credit relationships; no related-party conflicts identified for Highsmith in 2024 disclosures .
- RED FLAGS: None evident in proxy regarding Highsmith—no pledging/hedging, no related-party transactions, independence affirmed, Compensation Committee independence maintained .
Shareholder confidence signals: Strong say-on-pay support (≈90% in 2024; 5-year average ≈92%), robust governance practices including independent committees, ongoing director education, and active shareholder engagement with participation by the Lead Director .