Cristina Méndez

About Cristina Méndez

Executive Vice President & Chief Financial Officer of Otis since August 23, 2024; age 44 at appointment, promoted from SVP Finance EMEA & Transformation after 15+ years in senior finance roles at Telefónica Group, including SVP Director Controlling at Telefónica Deutschland (2018–2022) . Company performance context in 2024: organic sales +1.4%, adjusted EPS $3.83 (+8.2% YoY), adjusted operating margin +50 bps, operating cash flow $1.56B; modernization orders +12% and backlog +13% at constant currency, maintenance portfolio ~2.4M units (+4.2%) . Otis cumulative TSR since 2020: value of $100 initial investment at $209 in 2024 vs peer group $253 .

Past Roles

Organization	Role	Years	Strategic Impact
Otis Worldwide	SVP, Finance EMEA & Transformation	2022–2024	Led FP&A, M&A and transformation; EMEA responsible for >50% of global Service portfolio; drove growth and efficiency initiatives .
Telefónica Deutschland	SVP, Director Controlling	2018–2022	Managed multi‑billion P&L, led growth, efficiency and transformation projects across the telecom portfolio .
Telefónica Group	Senior Finance Executive (various)	~2003–2018	Strategic and financial planning roles across geographies; transformation leadership experience .

External Roles

No public company directorships or disclosed external committee roles .

Fixed Compensation

Component	Amount	Effective Date/Notes
Base Salary	$770,000	Effective Aug 23, 2024; paid monthly in CHF (13 installments with 13th in November), using 5‑yr avg USD/CHF FX at quarter‑end .
Target STI (annual bonus)	100% of base salary	Effective Aug 23, 2024; 2024 prorated for pre/post‑promotion periods .
2024 STI Paid	$750,373	Based on salary $786,705 (CHF→USD), financial factor 120%, ESG +7.5%, individual factor 105% .
Expatriate Benefits	$5,000/mo housing; utilities cap $645/mo; relocation CHF 12,792	Long‑term assignment to Farmington, CT; tax equalization to Switzerland; schooling, international health coverage .

Performance Compensation

2024 STI Design and Outcomes (Company-Level Metrics)

Metric (Weight)	Threshold	Target	Maximum	2024 Actual	Payout Factor
Adjusted Net Income (40%) ($M)	1,475	1,552	1,630	1,564	46%
Adjusted Free Cash Flow (30%) ($M)	1,421	1,579	1,737	1,571	29%
Organic Sales Growth (15%) (%)	-2.3	2.8	6.0	1.4	13%
New Equipment Orders Growth (15%) (%)	-12.3	-2.5	7.2	-7.6	11%
ESG Multiplier	—	—	±10%	+7.5%	Applied to total

Notes: 2024 metrics and weightings unchanged; ESG assessed holistically across safety, environment, people, governance with +7.5% outcome . Final company financial payout ≈ 99% before ESG/individual adjustments .

Méndez 2024 STI Payment Calculation

Input	Value
Salary used for STI	$786,705 (CHF→USD)
Target STI %	71.1% proration (full target 100%)
Financial Performance Factor	120% (prorated corporate/region mix)
ESG Multiplier	1.075
Individual Performance Factor	105%
STI Payment	$750,373

Long-Term Incentives (LTI) Structure and Grants

Award Type	2024 Annual Target	2024 Supplemental (Promotion)	Vesting	Performance Goals
PSUs (50%)	Included in $2,700,000 LTI	$2,390,000 × 50%	Cliff in early 2027 (2024–2026 cycle)	3‑yr cumulative adjusted EPS (60%) target $12.23 and 3‑yr avg organic sales growth (40%) target 3.1%; ±20% TSR multiplier vs S&P 500 Industrials; max 200% .
RSUs (25%)	Included	$2,390,000 × 25%	1/3 annually over 3 years	Time‑based; dividend equivalents .
SARs (25%)	Included	$2,390,000 × 25%	1/3 annually; 10‑yr term	Time‑based; strike set at grant; value only if stock appreciates .

Outstanding Equity (as of Dec 31, 2024)

Grant Date	Instrument	Unvested Units/Shares	Market Value ($)	Strike/Notes
8/23/2024	PSUs	12,468	$1,154,661	2024–2026 cycle .
8/23/2024	RSUs	6,234	$577,331	1/3 annual vest .
8/23/2024	SARs	24,161 unexercisable	—	$94.20; expire 8/22/2034 .
2/6/2024	PSUs	1,795	$166,235	2024–2026 cycle .
2/6/2024	RSUs	897	$83,071	1/3 annual vest .
2/6/2024	SARs	3,341 unexercisable	—	$91.94; expire 2/5/2034 .
Prior awards	RSUs/SARs	Various (2022–2023)	—	Local vesting schedules .

Equity Ownership & Alignment

Item	Detail
Beneficial Ownership	4,415 shares; 1,121 SARs exercisable within 60 days; <1% of shares outstanding .
Stock Ownership Guidelines	CFO required to hold 4× base salary; 5‑year compliance window from appointment; RSUs/DSUs count; PSUs/SARs excluded .
Hedging/Pledging	Prohibited for directors, officers, colleagues; no short sales/hedging/pledging allowed .
Vested vs Unvested	Significant unvested PSUs/RSUs/SARs through 2027 (see Outstanding Equity); dividend equivalents accrue on PSUs/RSUs .

Implications: Unvested multi‑year awards and ownership guidelines reduce near‑term selling pressure; pledging/hedging bans strengthen alignment .

Employment Terms

Term	Provision
Contract	Open‑ended; effective Aug 23, 2024; no trial period; 3‑month mutual notice period .
Work Location	Long‑term assignment to Farmington, CT; repatriation to Switzerland per policy .
Non‑Compete	2 years worldwide post‑employment; includes hiring ban; per‑breach contractual penalty = 12 months salary + target STI; injunctive relief available .
Non‑Solicit	2 years post‑employment .
Severance Plan	ELG Severance: lump‑sum 1× (CEO 1.5×) salary + target STI; prorated STI at actual results; 12 months healthcare; 12 months outplacement; requires restrictive covenants .
Change‑in‑Control (CIC) Plan	Double trigger; lump‑sum 2× salary + target STI (CEO 3×); prorated target STI; 12 months healthcare, outplacement, financial planning; equity vests at greater of actual/target .
Excise Tax	“Best‑net” approach (cut or pay, whichever yields higher after‑tax); no excise tax gross‑ups .
Clawbacks	Two recovery policies: restatement (NYSE‑compliant 3‑year lookback) and broader conduct‑based policy (Cause, non‑compete/solicit violations, misconduct causing material harm, recalculation of outcomes); committee discretion .
Compensation Currency	Base/bonus paid in CHF using 5‑yr avg FX; 13 monthly installments (13th in Nov) .
Pension	Swiss Base Plan PV $66,324; Swiss Supplementary 1e Plan PV $214,063 at 12/31/24; death/disability values specified .
Perquisites	Housing, utilities cap, relocation allowance, schooling, international health coverage, tax equalization .

Potential Payments (Proxy Illustrations at 12/31/2024)

Scenario	Cash Severance	Prorated STI	Equity (Stock/SARs)	Pension	Other Benefits	Total
Involuntary Termination (without Cause)	$1,346,104	$750,373	$522,855	$214,063	$56,073	$2,675,405
Death/Disability	—	$750,373	$2,936,948	$12,095,277 (death PV)	—	$3,687,321 (after subtracting vested)
CIC + Qualifying Termination (double trigger)	$2,692,208	$750,373	$2,936,948	$214,063	$72,073	$6,451,602

Notes: Equity values reflect proxy valuation methodology; equity forfeited for termination “for cause” .

Performance & Track Record

Investor engagement: Méndez (as CFO) participated with CEO and senior leaders in extensive meetings with institutional investors/analysts; management met ~80% of top 50 active holders and ~65% of top 100 in 2024 .
2024 Company results underpin STI/LTI: Service organic sales +6.8%; maintenance portfolio +4.2%; adjusted EPS +8.2%; cash flow ~$1.6B; capital returns ~$1.6B (buybacks $1.0B, dividends $0.6B) .
Pay‑for‑performance governance: strong clawbacks, ownership requirements, no hedging/pledging, no option repricing, no excise tax gross‑ups; say‑on‑pay approval ~89% in 2024 .

Compensation Structure Analysis

Cash vs Equity Mix: For NEOs, compensation heavily at‑risk via STI/LTI; Méndez annual LTI target $2.7M plus $2.39M supplemental at promotion emphasizes retention and performance alignment .
Metrics Rigor: STI weights earnings (40%) and FCF (30%) with growth metrics (15%/15%); PSU targets require ~7.2% EPS CAGR and 3.1% avg organic growth, plus ±20% relative TSR adjustment .
One‑time awards: Not applicable to Méndez; supplemental grant at promotion follows standard terms, indicating continuity rather than discretionary repricing .
Ownership Alignment: CFO 4× salary guideline and multi‑year vesting reduce misalignment and near‑term selling pressure; pledging prohibited .

Equity Ownership & Alignment Details

Measure	Value	Comment
Shares Beneficially Owned	4,415	As of Mar 17, 2025 .
SARs Exercisable within 60 days	1,121	As of Mar 17, 2025 .
% of Outstanding Shares	<1%	Ownership under 1% .
Stock Ownership Guideline	4× salary	5‑year compliance window; RSUs/DSUs count, PSUs/SARs excluded .
Pledging/Hedging	Prohibited	Policy applies to executives .

Employment & Contracts (Retention Risk, Transition)

Topic	Key Facts
Tenure in Role	CFO since Aug 23, 2024 .
Notice/Auto‑Renewal	3‑month notice; open‑ended, no auto‑renewal mentioned .
Non‑Compete/Non‑Solicit	2‑year global non‑compete and hiring ban; contractual penalty per breach (12 months salary + target STI) .
Severance Multiples	1× salary+target STI (ELG Severance); 2× salary+target STI (CIC) .
Garden Leave/Consulting	Not disclosed.
Deferred Comp/Pension	Swiss plans PV $66,324 (Base) and $214,063 (Supplementary) at 12/31/24 .

Risk Indicators & Red Flags

Hedging/pledging: prohibited for executives (positive) .
Clawbacks: robust dual policies covering restatements and misconduct (positive) .
Options Repricing: prohibited (positive) .
Excise Tax Gross‑ups: none; best‑net approach (positive) .
Insider selling: No Form 4 data provided here; equity largely unvested through 2027 (neutral to positive for selling pressure) .
Say‑on‑pay: strong approval (~89%) indicates investor support (positive) .

Compensation Peer Group (Benchmarking)

Peer group for 2024 (unchanged from 2023) includes: Carrier, Cummins, Dover, Eaton, Fluor, Fortive, Illinois Tool Works, Johnson Controls, Lear, Motorola Solutions, Parker Hannifin, Rockwell Automation, Stanley Black & Decker, TE Connectivity, Trane Technologies, Wabtec, Western Digital .

Say‑On‑Pay & Shareholder Feedback

Say‑on‑pay approval ~89% in 2024; Committee engages with investors and uses feedback to refine programs; extensive outreach conducted, including ESG engagement and discussions around one‑time equity grants (for other executives) .

Expertise & Qualifications

Finance and transformation leadership across industrials and telecoms; strategic FP&A, M&A execution; multi‑region experience (EMEA); no formal education credentials disclosed in filings .
Investor‑facing CFO role with active engagement alongside CEO .

Investment Implications

Alignment: High at‑risk pay with rigorous STI/LTI metrics and relative TSR modifier; robust clawbacks and ownership rules reduce agency risk .
Retention: Multi‑year PSUs/RSUs/SARs vesting through 2027 and global non‑compete/non‑solicit (with penalties) materially lower near‑term attrition risk .
Selling Pressure: Beneficial ownership is modest (<1%), but meaningful unvested equity and ownership guideline suggest limited discretionary selling; pledging/hedging bans further mitigate pressure .
Change‑in‑Control Economics: Double‑trigger 2× cash multiple and accelerated equity could be costly in a transaction; however, no excise tax gross‑ups and best‑net provision moderate parachute optics .
Execution: Méndez’s EMEA transformation background aligns with Otis’ Service‑led model and UpLift program; 2024 results support pay outcomes and indicate operational discipline under current leadership .