Judith Marks

About Judith Marks

Judith F. Marks is Chair, Chief Executive Officer and President of Otis Worldwide. She has served as President since 2017, CEO since 2019 (Otis Elevator Company) and CEO/President of Otis Worldwide since 2020; she was appointed Board Chair in February 2022 and has been a director since April 2020 . Age: 61 . Under her leadership in 2024, Otis delivered 1.4% organic sales growth, expanded adjusted operating margin by 50 bps, grew adjusted EPS by 8.2%, generated $1.56B operating cash flow, and returned ~$1.6B to shareholders ($1.0B buybacks, ~$0.6B dividends) . Since the April 2020 spin, an initial $100 in OTIS returned $209 through 2024 year-end; adjusted EPS (company-selected measure) was $3.83 and GAAP net income $1,645M in 2024 .

OTIS fundamentals during her tenure (fiscal years):

Metric	FY 2020	FY 2021	FY 2022	FY 2023	FY 2024
Revenues ($USD)	$12,756,000,000*	$14,298,000,000*	$13,685,000,000*	$14,209,000,000*	$14,261,000,000*
EBITDA ($USD)	$2,109,000,000*	$2,374,000,000*	$2,287,000,000*	$2,437,000,000*	$2,531,000,000*
Cash from Operations ($USD)	$1,480,000,000*	$1,750,000,000*	$1,560,000,000*	$1,627,000,000*	$1,563,000,000*
Values retrieved from S&P Global.*

Past Roles

Organization	Role	Years	Strategic impact
Otis Worldwide	Chair	2022–present	Combined Chair/CEO to streamline decision-making with strong Lead Director oversight .
Otis Worldwide	CEO & President	2020–present	Led 2024 EPS growth (+8.2% adj), modernization orders growth (+12%+), and strong cash returns .
Otis Elevator Company	President; CEO	2017–present; 2019–2020	Drove Service portfolio growth and digitalization (Otis ONE) .
Siemens USA / Dresser-Rand (Siemens)	CEO (Siemens USA and Dresser-Rand)	2016–2017	Led integration/execution in industrial technology .
Dresser-Rand	EVP, New Equipment Solutions	2015–2016	Commercial/operations leadership in energy/industrial .
Siemens Government Technologies	President & CEO	2011–2015	Government-focused solutions leadership .

External Roles

Organization	Role	Years	Notes
Caterpillar, Inc.	Director	Current	Public company directorship .
Business Roundtable	Board member; Chair of Trade & International; Co-Chair, China WG; Member Tax Committee	2021–present (board since 2023)	Policy influence roles .
AdvanceCT	Board Member	2021–present	State economic development org .
U.S.-India CEO Forum	Member	2022–2024	Bilateral CEO engagement .

Fixed Compensation

Base salary: $1,400,000 effective April 1, 2024 (up 1.8% from $1,375,000) . 2024 salary reported in SCT: $1,393,750 .
Perquisites and other benefits (2024): $414,360 total, including $349,781 company contributions to deferred compensation plans, $23,726 vehicle, $16,000 financial planning, $15,212 health benefits, $9,641 misc (e.g., cybersecurity monitoring, matching gifts) .

Performance Compensation

Short-term incentive (STI) design and outcomes (2024):

Target bonus: 160% of base salary .
Metrics/weights: Adjusted Net Income (40%), Adjusted Free Cash Flow (30%), Organic Sales Growth (15%), New Equipment Orders Growth (15%); ESG multiplier +/-10% (applied +7.5%); individual performance factor applied .
Results and payout:

Metric	Weight	Threshold	Target	Max	2024 Actual	Payout factor
Adjusted Net Income ($M)	40%	1,475	1,552	1,630	1,564	46%
Adjusted FCF ($M)	30%	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%
Total before ESG/individual	—	—	—	—	—	99%
ESG multiplier	—	—	—	—	—	+7.5%
Individual performance factor	—	—	—	—	—	105% for Marks
Cash STI paid (Marks)	—	—	—	—	—	$2,500,000

Long-term incentive (LTI) program (annual 2024 awards):

Mix: 50% PSUs, 25% RSUs, 25% SARs; equity grant policy avoids spring-loading/bullet-dodging; grants approved after earnings/10-K .
Marks’ 2/6/2024 awards: PSUs target 68,423 ($6,597,173 FV), RSUs 34,212 ($3,145,451 FV), SARs 129,311 at $91.94 ($3,145,791 FV) .
PSU metrics/thresholds (2024–2026 cycle): 3-year Cumulative Adjusted EPS (60%) with target $12.23; 3-year Average Organic Sales Growth (40%) with target +3.1%; relative TSR multiplier +/-20% vs S&P 500 Industrials; max payout 200% .
RSU vesting: ratable over 3 years; SAR vesting: ratable over 3 years; SARs expire after 10 years .

One-time retention award to Marks (granted 7/23/2024):

Structure: 60% PSUs (154,036 target units), 40% RSUs (102,691 units); same 2024–2026 PSU design; added conditions: employment through 3rd anniversary (except death/disability/CIC termination), no accelerated retirement vesting, mandatory 1-year post-vesting holding period for after-tax shares .
Grant-date fair values: PSUs $15,213,163; RSUs $9,692,569 .
Rationale: ensure leadership continuity during UpLift transformation and macro uncertainty; outreach conducted to top holders (~47% outstanding) .

Vesting, exercises, realized:

2024 vested equity realized by Marks: 169,276 shares; no SAR exercises in 2024 .
Outstanding equity (12/31/2024): Unvested RSUs 34,749 (2/6/2024 grant) and 103,532 (7/23/2024 grant); unearned PSUs 69,497 (2/6/2024) and 155,297 (7/23/2024); unexercised SARs 129,311 @ $91.94 (exp. 2/5/2034) .

PSU vesting outcomes (prior cycle):

2022–2024 PSU cycle paid at 0.82x (Cumulative EPS factor 0.99; Average Organic Sales Growth factor 0.66; relative TSR -4.06% multiplier) .

Equity Ownership & Alignment

Beneficial ownership (as of 3/17/2025): 349,973 shares; SARs exercisable within 60 days: 199,500; ownership <1% of shares outstanding .
Deferred PSUs: 92,828 vested DSUs under LTIP PSU Deferral Plan to be distributed upon separation .
Ownership guidelines: CEO must hold 6x base salary; options/SARs and unvested PSUs are excluded from compliance; executives cannot sell shares until compliant; annual compliance review .
Hedging/pledging: prohibited for directors, officers and employees; short sales also prohibited .
Clawbacks: compliant with NYSE restatement rule (3-year lookback of erroneously awarded comp); broader Otis policy includes cause, covenant breaches, misconduct causing harm, and recalculation triggers; Compensation Committee discretion .

Employment Terms

Employment agreement: none for U.S.-based ELG members (includes Marks) .
Post-employment covenants: non-compete and non-solicit obligations required for severance eligibility; violations subject to clawback .
Severance Plan (involuntary termination without cause, not in CIC window): cash severance equal to 1.5x (CEO) salary + target STI; prorated STI at actual company results (individual at target); up to 12 months healthcare at no cost; up to 12 months outplacement; severance reduced by value of legacy ELG RSUs that vest, if any . Illustrative potential payments table for Marks shows total value $19.87M including equity acceleration in a no-cause termination scenario .
Change-in-Control (double-trigger within 2 years): cash severance 3x (CEO) salary + target STI; prorated target STI; up to 12 months healthcare, outplacement, and financial planning; no excise tax gross-up—best-net cutback applies; unvested equity vests upon qualifying termination (PSUs at greater of actual or target) .
Deferred compensation plans available (DCP and LTIP PSU deferral); Marks elected to defer $6.26M of vested PSUs in 2024 .

Board Governance

Dual role: Marks serves as combined Chair/CEO since 2022; the Board cites decisive leadership benefits and strong independent oversight via Lead Director .
Independence: 10 of 11 director nominees are independent; all committees (Audit, Compensation, Nominations & Governance) are composed solely of independent directors .
Lead Independent Director: John H. Walker, with final approval authority over agendas/materials, power to call meetings, leading executive sessions each meeting, and serving as liaison to management; annual selection required when Chair is not independent .
Board activity/attendance: 5 Board and 20 committee meetings in 2024; 100% attendance .
Executive sessions: private sessions without CEO/management typically after each Board and committee meeting .
Director compensation: employee directors receive no additional pay; non-employee directors receive $310,000 retainer (40% cash/60% DSUs) plus role-based increments; DSUs vest on grant and settle at/after Board departure; non-employee director stock ownership guideline = 5x cash retainer .

Director Compensation and Outside Directorships (Marks)

Director pay at Otis: none (employee) .
Other public company board: Caterpillar, Inc. (current) .

Compensation Committee Analysis

Committee members: Shailesh G. Jejurikar (Chair), Thomas A. Bartlett, Nelda J. Connors, Shelley Stewart Jr., John H. Walker; all independent; no interlocks/insider participation .
Independent consultant: Pearl Meyer; advises on design and benchmarking; deemed independent by the Committee .
Peer group (unchanged in 2024, 17 companies): Carrier, Cummins, Dover, Eaton, Fluor, Fortive, Illinois Tool Works, Johnson Controls, Lear, Motorola Solutions, Parker Hannifin, Rockwell Automation, Stanley Black & Decker, TE Connectivity, Trane, Wabtec, Western Digital .
Pay practices: heavy at-risk pay (CEO ~91% at-risk), robust clawbacks, strong ownership requirements, prohibition on hedging/pledging, no option/SAR repricing, no single-trigger CIC vesting, no CIC excise tax gross-ups .

Say-on-Pay & Shareholder Feedback

2024 Say-on-Pay: ~89% approval (votes cast; company disclosure) and 8-K tally 295,870K For / 36,553K Against / 1,452K Abstain .
2025 Say-on-Pay: failed—131,353K For / 202,205K Against / 1,075K Abstain; Board engaged top shareholders, notably regarding one-time awards .
Implication: The 2025 failure signals investor concern primarily around discretionary one-time awards magnitude/structure and overall pay levels; expect program design and/or one-time award usage to be reassessed.

Equity Grants Detail (2024)

Grant	Date	Type	Quantity/Terms	Grant Date FV
Annual LTI	2/6/2024	PSUs (target)	68,423; 2024–2026 cycle; EPS (60%)/Org Sales (40%)+/-20% TSR	$6,597,173
Annual LTI	2/6/2024	RSUs	34,212; vest ratably over 3 years	$3,145,451
Annual LTI	2/6/2024	SARs	129,311 @ $91.94; vest ratably over 3 years; expire 2/5/2034	$3,145,791
One-time	7/23/2024	PSUs (target)	154,036; same metrics; must remain employed through 3-year anniversary; 1-yr post-vest hold	$15,213,163
One-time	7/23/2024	RSUs	102,691; cliff vest at 3 years; 1-yr post-vest hold	$9,692,569

Ownership Snapshot and Potential Selling Pressure

Beneficially owned 349,973 shares; SARs exercisable within 60 days: 199,500; percentage of class: <1% .
2024 realized vesting without SAR exercises; presence of mandatory 1-year holding on 2024 one-time awards reduces near-term selling pressure on those shares .
Hedging/pledging banned; no share pledging risk .

Employment, Severance & Change-in-Control Economics

Severance (non-CIC): 1.5x (CEO) salary + target STI; prorated STI at actual; health/outplacement; reduced by legacy ELG RSU vest value .
CIC (double-trigger, within 2 years): 3x (CEO) salary + target STI; prorated target STI; health/outplacement/financial planning; equity accelerates (PSUs >= actual or target); best-net cutback (no excise gross-up) .

Performance & Track Record

2024 strategic outcomes: Service organic sales +6.8%, maintenance portfolio +4.2% to ~2.4M units; modernization orders +12% with backlog +13% (cc); adjusted EPS +8.2%; ~$1.6B adjusted FCF; ~$1.6B capital returns .
TSR since spin (Apr 2020–2024): $100 → $209; peer group $100 → $253 (S&P 500 Industrials) .
Pay-versus-performance confirms linkage to stock price (Compensation Actually Paid moved with TSR) .
Company financial trajectory (annual): revenues flat-to-up modestly; EBITDA and operating cash flow resilient amid macro headwinds, supporting ongoing buybacks/dividends . See table in “About” (S&P Global).*

Board Service History, Committees, Dual-role Implications

Board service: Director since April 2020; elevated to Chair in Feb 2022 alongside CEO role .
Committee roles: As Chair/CEO, Marks serves on no Board committees; all committees are independent .
Governance mitigants for combined Chair/CEO: robust Lead Director authority (agendas/materials approvals, executive sessions, stakeholder meetings) and regular independent sessions each meeting .
Attendance: Board 5 and committees 20 meetings in 2024; 100% attendance across directors .

Compensation Structure Analysis

Mix: ~91% of CEO target comp at-risk via STI/LTI; strong use of PSUs and multi-year metrics with relative TSR overlay .
2024 changes: One-time equity awards (PSU/RSU) to CEO and two executives for retention/continuity during UpLift transformation; awards remove accelerated retirement vesting and add post-vest holding periods to strengthen alignment .
Governance controls: no hedging/pledging; no option/SAR repricing; no single-trigger CIC vesting; robust clawbacks; independent consultant; peer benchmarking to market medians .
Shareholder signal: 2025 say-on-pay failure after one-time awards suggests need to recalibrate magnitude or apply more stringent performance/vesting and clearer forward limits on special awards .

Risk Indicators & Red Flags

2025 say-on-pay failed (for 131.35M vs against 202.20M) .
CEO pay ratio 2024: 689:1 due to one-time award; excluding the one-time award, 281:1 .
No hedging/pledging allowed; no CIC excise tax gross-ups; no single-trigger equity vesting; no option repricing .

Compensation Peer Group

17-company industrial/tech capital goods peer set; used to align to market medians considering size/complexity; unchanged in 2024 .

Say-on-Pay History

Year	For	Against	Abstain	Outcome
2024	295,869,858	36,552,568	1,452,428	Approved
2025	131,352,789	202,204,629	1,074,705	Failed

Investment Implications

Alignment and retention: Stock-heavy LTI design with multi-year PSU metrics and new holding requirements support alignment; ownership guidelines (6x salary for CEO), clawbacks, and hedging/pledging prohibitions are strong positives .
Overhang/selling pressure: 2024 one-time grants increase future equity overhang; mandatory post-vest hold and no hedging/pledging limit near-term selling, but future vest events (2026–2027) merit monitoring .
Governance risk: 2025 say-on-pay failure elevates risk of compensation program changes and potential investor activism; likely Board/Committee response includes revising special award usage and enhancing performance conditioning/disclosure .
Execution: Operational performance and TSR since spin are solid; continued Service growth, modernization backlog, and cash returns underpin confidence, but macro exposure (China, rates) and execution of UpLift transformation are critical to pay-for-performance credibility .

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