Robert H. Herz
MORGAN STANLEYAbout Robert H. Herz
Robert H. Herz (age 71 at the 2025 annual meeting) has served as an independent director of Morgan Stanley since 2012. A former Chair of the Financial Accounting Standards Board and Partner at PwC, Herz brings deep expertise in public accounting, financial reporting, sustainability, and risk management. He holds a bachelor’s degree from The University of Manchester. Herz is designated by the Board as an “audit committee financial expert.”
Past Roles
| Organization | Role | Tenure | Committees/Impact |
|---|---|---|---|
| Financial Accounting Standards Board (FASB) | Chair | Jul 2002 – Sep 2010 | Led U.S. standard-setting, enhancing financial reporting quality |
| International Accounting Standards Board (IASB) | Part-time Member | Jan 2001 – Jun 2002 | Advanced international standards harmonization |
| PricewaterhouseCoopers (PwC) | Partner | 1985 – 2002 | Senior public accounting leadership |
| PCAOB Standing Advisory Group | Member | 2012 – 2020 | Advised on audit standards and oversight |
| Accounting Standards Oversight Council (Canada) | Member | 2011 – Mar 2017 | Governance of Canadian standard-setting |
| Sustainability Accounting Standards Foundation/Value Reporting Foundation | Director | 2014 – Jun 2021; Jun 2021 – Aug 2022 | Sustainability reporting frameworks |
| Robert H. Herz LLC | President | Sep 2010 – Present | Consulting on financial reporting and related matters |
External Roles
| Organization | Role | Tenure | Notes |
|---|---|---|---|
| Workiva Inc. | Director (U.S.-listed) | Current | Current public company directorship |
| Federal National Mortgage Association (Fannie Mae) | Director | Past 5 years | Prior U.S.-listed board service |
| International Foundation for Valuing Impacts | Director | Jun 2022 – Present | Impact valuation governance |
| ISSB/IASC advisory councils | Member | Aug 2022 – Oct 2024 | Integrated Reporting and Connectivity Council; Transition Advisory Group |
Board Governance
- Committee assignments: Audit Committee Chair; Governance & Sustainability Committee member. Herz and Dennis Nally are designated “audit committee financial experts.”
- Independence: Board determined Herz is independent under Morgan Stanley’s Director Independence Standards and NYSE rules.
- Attendance and engagement: Board met 14 times in 2024; each current director attended at least 75% of Board and committee meetings. Audit Committee held 13 meetings in 2024.
- Risk oversight: As Audit Chair, Herz oversees integrity of financial statements, internal controls, compliance, major legal/financial crime risks, and the independent auditor’s performance. The Audit Committee also reviews voluntary sustainability/climate disclosures.
Fixed Compensation
| Component | 2024 Value | Notes |
|---|---|---|
| Board/Committee Cash Retainers | $142,500 | Herz’s fees earned or paid in cash for 2024 service |
| Committee Chair Fees | Policy: $40,000 (Audit/Risk) | Audit Committee chair fee level (effective policy) |
| Board Member Retainer | Policy: $100,000, increased to $115,000 effective Nov 1, 2024 | Cash retainer policy (increase approved) |
Performance Compensation
| Equity Award | Grant Date | Grant Value | Valuation Basis | Vesting/Payment |
|---|---|---|---|---|
| Annual Director Stock Units (DECAP) | Jun 1, 2024 | $260,000 | VWAP $97.1856 on grant date | 50% Career Units (payable at Board departure), 50% Current Units (payable on first anniversary), monthly vesting for annual award |
| Initial/Annual Equity Structure | Policy | $260,000 (initial prorated; annual) | DECAP stock units | Career Units deferred until departure; Current Units payable at 1-year; directors may elect extended deferral |
| Director Ownership Requirement | Policy | 5× annual cash Board retainer | Must retain 100% of stock unit awards (after-tax) until requirement met |
Other Directorships & Interlocks
- Current public company boards: Workiva Inc.
- Prior public boards (past 5 years): Fannie Mae.
- Interlocks: Proxy states no compensation committee interlocks involving Morgan Stanley directors during 2024; none identified involving Herz.
Expertise & Qualifications
- Qualifications: Extensive global regulatory, public accounting, financial reporting, risk management, sustainability, and financial services experience; former FASB Chair; former PwC Partner.
Equity Ownership
| As-of Date | Common Stock | Underlying Stock Units | Subject to Rights to Acquire within 60 Days | Total |
|---|---|---|---|---|
| Feb 28, 2025 | 23,920 | 73,640 | — | 97,560 |
- Pledging/Hedging: Firm policy prohibits directors from pledging, short-selling, hedging, or trading derivatives in Morgan Stanley securities.
- Director equity requirement: Must hold stock/equity awards equal to 5× annual cash retainer; retain 100% of stock unit awards until in compliance.
Insider Trades
| Date | Form 4 Action | Security | Shares/Units | Value | Source |
|---|---|---|---|---|---|
| May 2, 2025 | Sale | MS common | 800 | $95,456 | |
| Jun 1, 2025 | Grant (DECAP units) | MS stock units | 2,155 | — | |
| Jul 19, 2024 | Sale | MS common | — | $106,621 | |
| Jun 1, 2024 | Grant (DECAP units) | MS stock units | 2,680 (aggregate listed for directors) | — |
Note: Grants reflect standard annual director equity awards under DECAP; share counts and values are as reported in third-party summaries derived from SEC filings.
Governance Assessment
- Strengths: Independent director; Audit Committee Chair with “audit committee financial expert” designation; robust engagement (13 Audit Committee meetings in 2024; Board attendance ≥75%); compensation aligned with shareholders via significant equity deferral; strong ownership alignment with stock units and common shares; firm-wide prohibitions on hedging/pledging.
- Conflicts/related-party exposure: Board’s independence review found director nominees’ personal use of Morgan Stanley products/services (including Herz) immaterial; no Herz-specific related-party transactions disclosed.
- Red flags: None disclosed regarding pledging, hedging, tax gross-ups, loans, or related-party transactions for Herz; director compensation capped by shareholder-approved annual limit and structured with long-term equity alignment.