John Nunnelly
About John N. Nunnelly
John N. Nunnelly, 72, is an independent director of National Research Corporation (NRC Health) who has served on the Board since December 1997 and as Lead Director since May 2012. He is a retired Group President of McKesson Corporation with prior roles in strategy, business development, general management and sales leadership; he has also served as an adjunct professor at the University of Massachusetts School of Nursing focused on healthcare IT. The Board has designated him an “audit committee financial expert.”
Past Roles
| Organization | Role | Tenure | Committees/Impact |
|---|---|---|---|
| McKesson Corporation | Group President; previously VP Strategic Planning & Business Development; VP & GM Amherst Product Group; VP Sales-Decision Support | 28-year career (dates not specified) | Led multiple business units (one >$360mm revenue); M&A execution |
| University of Massachusetts School of Nursing | Adjunct Professor | Not disclosed | Advised students/faculty on healthcare IT |
External Roles
| Organization | Role | Tenure | Notes |
|---|---|---|---|
| — | — | — | No other public company directorships disclosed in the proxy |
Board Governance
- Independence and leadership: Nunnelly is independent and has served as Lead Director since 2012, with responsibilities including presiding over sessions without the CEO, setting agendas for independent director executive sessions, advising on board information flow, and calling meetings of independent directors. The Board plans to separate the Chair and CEO roles when the new CEO begins (CEO effective June 1, 2025; Hays to become Chairman).
- Committees (2024 composition and activity):
- Audit Committee: Chair (Nunnelly); 6 meetings; Board determined he is an “audit committee financial expert.”
- Compensation & Talent Committee: Member; 2 meetings.
- Nominating Committee: Member; 1 meeting.
- Strategic Planning Committee: Chair; 0 meetings.
- Attendance: Board held 6 meetings plus 1 independent directors meeting in 2024; all directors attended at least 75% of aggregate Board/committee meetings for their service periods; each director attended the 2024 annual meeting.
- Majority voting & proxy access: Majority vote policy for uncontested elections; proxy access at 3% ownership for 3 years, up to 20% of Board nominees.
Fixed Compensation (Director)
| Component (2024) | Amount | Details |
|---|---|---|
| Lead Director annual cash retainer | $75,000 | Fixed fee for Lead Director role |
| Director Cash Payment (in-person meeting contingent) | $25,000 (earned portion) | Up to $50,000 total ($25k per in‑person meeting); table notes show $25k earned in 2024 |
| Total “Fees Earned or Paid in Cash” (2024) | $100,000 | Nunnelly line item in 2024 Director Compensation table |
Performance Compensation (Director)
| Equity Element | Grant/Value | Terms | Vesting |
|---|---|---|---|
| Annual Director Option (2004 Director Stock Plan) | $100,008 grant date fair value | Exercise price at FMV on grant date (Annual Meeting); typical annual grant to non‑employee directors | Vests the day immediately preceding the next Annual Meeting |
| Director Equity Award (meeting-contingent) | Target $50,000 | Additional option contingent on two in‑person meetings | No shares earned for 2024 (not met) |
- 2024 director compensation total for Nunnelly: $200,008 (cash $100,000; option award $100,008).
Other Directorships & Interlocks
- Compensation Committee interlocks: None; no related “insider participation” disclosures for committee members.
- Current other public boards for Nunnelly: None disclosed.
Expertise & Qualifications
- Financial expertise: Recognized by the Board as an “audit committee financial expert,” meeting SEC/NASDAQ independence and sophistication criteria.
- Healthcare IT and operations: Deep domain and leadership experience from McKesson and academic advisory role in healthcare IT.
Equity Ownership
| Metric | Value |
|---|---|
| Beneficial ownership (as of record date Mar 20, 2025) | 87,904 shares; includes 55,238 shares underlying options exercisable within 60 days |
| Ownership as % of shares outstanding | <1% (star denoted in proxy) |
| Outstanding director options (as of 12/31/2024) | 55,238 options |
Insider Trading Activity (Form 4)
Note: “securitiesOwned” reflects post-transaction holdings reported in each Form 4 entry. See linked filings for full details.
Governance Assessment
-
Strengths
- Long-tenured independent Lead Director with deep healthcare IT and multi-unit P&L experience, and designated audit committee financial expert (supports audit oversight).
- Broad committee engagement: Audit (Chair), Strategic Planning (Chair), Compensation (member), Nominating (member); strong attendance culture (≥75% for all directors) and participation in annual meeting.
- No related-person transactions in 2024; no comp committee interlocks; majority vote and proxy access provisions in bylaws.
-
Potential Risks / Watch Items
- Hedging policy: Company states it does not have practices or policies regarding hedging by employees or directors; while it notes no historical hedging by officers/NEOs, absence of a formal prohibition can be viewed as a governance gap at many issuers.
- Strategic Planning Committee did not meet in 2024 (while chaired by Nunnelly); ensure strategic oversight is occurring at full Board level (Board retains full risk oversight).
-
Alignment & Incentives
- Director pay mix is balanced between cash and at-risk equity; 2024 contingent meeting-based equity (Director Equity Award) was not earned, suggesting adherence to participation conditions; annual option vests prior to next annual meeting.
- Beneficial ownership <1% but includes a meaningful number of exercisable options; no pledging disclosed in proxy.
Director Compensation (Detail)
| Item | 2024 |
|---|---|
| Fees earned or paid in cash | $100,000 (includes $25,000 earned from meeting-contingent cash) |
| Option awards (grant date fair value) | $100,008 (annual director option) |
| Total | $200,008 |
| Structure (policy) | Lead Director cash retainer $75,000; up to $50,000 Director Cash Payment (two in-person meetings); meeting‑contingent Director Equity Award target $50,000 (not earned in 2024); annual director option grant target ~$100,000; exercise price at FMV; vests day before next annual meeting. |
Equity Ownership & Options
| Metric | Value | As-Of |
|---|---|---|
| Beneficial ownership (shares) | 87,904 | Record date Mar 20, 2025 |
| Ownership % | <1% | Record date Mar 20, 2025 |
| Options exercisable within 60 days (included above) | 55,238 | Record date Mar 20, 2025 |
| Outstanding director options (count) | 55,238 | 12/31/2024 |
Say‑on‑Pay & Shareholder Feedback (Context)
- Say‑on‑Pay approval in May 2024: >98% of votes cast in favor; committee subsequently redesigned 2025 executive packages with heavy equity alignment due to CEO transition.
Related‑Party Transactions and Conflicts
- Company reported no related person transactions in 2024; Board has written policy with Audit Committee oversight for any such transactions.
Executive Sessions and Risk Oversight
- One independent directors meeting held in 2024; Audit Committee oversees financial, legal compliance, ethics, and cyber risks; Compensation Committee reviews comp risk; full Board oversees operational/strategic risks.
Compensation Committee Analysis (Composition)
| Member | Role |
|---|---|
| Stephen H. Lockhart | Chair |
| Donald M. Berwick | Member |
| Parul Bhandari | Member |
| John N. Nunnelly | Member |
| Penny A. Wheeler | Member |
| All meet SEC/NASDAQ independence standards; no outside interlocks. |
Summary Implications for Investors
- Nunnelly’s long tenure, audit expertise, and lead director role bolster board effectiveness, particularly in audit and strategic oversight; committee leadership breadth is a positive signal.
- Governance frameworks (majority voting, proxy access, absence of related-party transactions) are supportive; however, lack of a formal hedging prohibition for directors is a watch item for alignment best practices.
