Amy Friedrich
PRINCIPAL FINANCIAL GROUPAbout Amy Friedrich
President, Benefits and Protection at Principal Financial Group (PFG), and one of the company’s Named Executive Officers. Her segment emphasizes small and mid-sized businesses (SMB), with differentiated underwriting results and margin discipline; she cites knowledge-worker mix, improved LTD incidence, and disciplined pricing as drivers of better loss ratios and profitability . Company performance context for 2024: non-GAAP operating EPS $6.97, AUM $712B, and $1.7B returned to shareholders (buybacks + dividends), supporting incentive outcomes tied to non-GAAP ROE, operating margin, and enterprise growth metrics .
Past Roles
No prior-role biography for Ms. Friedrich was disclosed in the filings and documents reviewed (DEF 14A and FY2024 10-K reference Part III material to the proxy without executive bios) .
External Roles
No external board or outside role disclosures for Ms. Friedrich were found in the filings and documents reviewed .
Fixed Compensation
Multi-year compensation summary (as reported in the Summary Compensation Table):
| Component | 2022 | 2023 | 2024 |
|---|---|---|---|
| Salary ($) | $623,615 | $661,615 | $684,385 |
| Stock Awards ($) | $1,968,641 | $2,393,957 | $2,462,362 |
| Non-Equity Incentive Plan Compensation ($) | $864,331 | $1,237,221 | $1,222,311 |
| All Other Compensation ($) | $46,929 | $74,183 | $65,146 |
| Total ($) | $3,503,516 | $4,738,010 | $4,434,204 |
Key fixed-pay elements and annual bonus parameters:
| Metric | 2022 | 2023 | 2024 |
|---|---|---|---|
| Base Salary ($) | $637,000 (table of 2022 baseline salaries) | $669,000 | $689,000 (raised to align with peer median) |
| Target Bonus (% of Salary) | n/a | n/a | 200% (PrinPay Plan target for Friedrich) |
| Actual Annual Bonus ($) | $864,331 | $1,237,221 | $1,222,311 (PrinPay score 94% and individual modifier 95%) |
Annual incentive framework (PrinPay) metrics include Non-GAAP Operating Earnings, Customer Driven Revenue Growth, Managed Net Cash Flow, Diversity Index, and Free Capital Flow payout modifier; corporate score earned 94% of target for 2024 .
Performance Compensation
2024 long-term incentive design: 70% PSUs and 30% RSUs; RSUs have 3-year cliff vesting; PSUs have 3-year performance with 50% average non-GAAP ROE and 50% Operating Margin, modified 0.8x–1.2x by 3-year RTSR vs S&P Financials peers .
| Award | Grant Date | Metric | Weighting | Target | Actual/Payout Basis | Vesting |
|---|---|---|---|---|---|---|
| PSUs (2024–2026 Cycle) | 02/26/2024 | Avg non-GAAP ROE; Operating Margin; RTSR modifier | 50% ROE; 50% OM | 21,072 sh (Target) | Threshold: ROE 7.5% / OM 15.1%; Target: ROE 14.1% / OM 30.2%; Max: ROE 18.4% / OM 39.3% (payout 50%/100%/150%) | End of 3-year cycle; continued service; RTSR multiplier 0.8–1.2 |
| RSUs (Time-Based) | 02/26/2024 | Time-based | 30% of LTI | 9,031 sh | Grant-date FV $723,473 | 3-year cliff; vest ~02/26/2027 |
| PSU Cycle (2022–2024) | Vested 12/31/2024 | Avg non-GAAP ROE; Operating Margin; RTSR modifier | 50% ROE; 50% OM | n/a | Paid at 88% of target in Feb 2025 per Committee approval | Settled Feb 2025 |
Grants of plan-based awards (quantitative detail for 2024):
| Item | Value |
|---|---|
| Friedrich PSUs 2024: Target 21,072 sh; Max 37,930 sh; Grant-date FV $1,688,078 | |
| Friedrich RSUs 2024: 9,031 sh; Grant-date FV $723,473 |
Equity Ownership & Alignment
Beneficial ownership and outstanding awards:
| Item | Detail |
|---|---|
| Beneficial Ownership (common) | 287,223 sh; <1% of outstanding |
| Rights to acquire within 60 days (options/units) | 218,955 sh (footnote for NEO rights) |
| Stock Units (economic interest, not in beneficial ownership table) | 17,841.464 units |
| Unvested RSUs (market value at 12/31/2024, $77.41/sh) | 9,003 sh ($696,908); 8,490 sh ($657,200); 9,352 sh ($723,908) |
| Unearned PSUs (market/payout value at 12/31/2024) | 20,285 sh ($1,570,262); 19,810 sh ($1,533,522); 21,820 sh ($1,689,091) |
| Options Exercisable | 2018: 35,680 sh @ $63.98 exp 02/26/2028; 2019: 64,750 sh @ $53.09 exp 02/25/2029; 2020: 73,260 sh @ $51.73 exp 02/24/2030; 2021: 45,265 sh @ $58.68 exp 03/05/2031 |
Ownership policies and alignment safeguards:
- NEO ownership guidelines: 4× base salary; must retain 50% of net profit shares until guideline met; all NEOs comply .
- Hedging prohibitions: short sales, derivatives, collars, etc. prohibited .
- Pledging prohibitions: pledging or margin accounts prohibited for Section 16 officers .
Employment Terms
Severance and change-of-control protections (market-standard, governed by Human Resources Committee):
| Provision | Terms |
|---|---|
| Executive Severance Plan (Involuntary, RIF/role elimination) | Lump sum = 1.5× salary + 1.5× average last 3 bonuses + 1.5 years health premium reimbursement; plus outplacement |
| Illustrative Severance (12/31/2024 scenario) | Severance $2,597,286; Outplacement $40,000; COBRA reimburse $43,238; Total $2,680,524 |
| Change-of-Control Agreement | Double-trigger; cash severance = 2× (base + target bonus); equity awards vest immediately if not substituted by successor; prorated annual bonus for year of termination; benefits continuation up to 3 years; reimbursement of legal fees |
| Non-compete | 1 year post-termination under CoC agreement |
| Tax gross-ups | No excise tax gross-ups; cutback to maximize after-tax benefits if applicable |
| Clawbacks | Mandatory SEC/Nasdaq-compliant clawback and broader discretionary recovery policy for misconduct and erroneous financials |
Additional Benefits, Deferred Comp, and Pension
Key retirement and deferred comp elements:
| Item | 2024 Value |
|---|---|
| 401(k) match + Excess Plan match (Company contributions) | $56,400 total ($17,250 401(k) + $39,150 Excess Plan) |
| Perquisites and other personal benefits | $8,746 (annual physicals, business spousal travel, sales conference gifts; aircraft personal use limited to CEO/Chair) |
| Deferred Comp (Excess/NQDC) – Executive contributions | $67,923 (2024) |
| Deferred Comp – Company contributions | $39,150 (2024) |
| Deferred Comp – Aggregate earnings | $99,160 (2024) |
| Deferred Comp – Aggregate balance | $927,493 (12/31/2024) |
| Pension – Qualified Plan PV | $648,636 (12/31/2024) |
| Pension – NQDB PV | $2,267,074 (12/31/2024) |
| Change in Pension Value (SCT) | $(54,280) in 2024 (reported as $0 per SEC rules) |
Compensation Structure Analysis
- Pay mix remains heavily at-risk and equity-linked: PSUs and RSUs (70%/30% of LTI) with multi-year ROE/OM goals and RTSR modifier; RSUs with 3-year cliff vesting .
- Annual bonus (PrinPay) grounded in enterprise financials and customer growth metrics; 2024 company score earned at 94% and Friedrich’s individual modifier set at 95%, yielding $1.22M payout .
- Ownership alignment is strong: 4× salary stock ownership guideline with 50% net share retention until compliance; hedging and pledging prohibited .
- Pension and deferred balances are material for long-tenured executives, but clawbacks, no repricing, and no tax gross-ups (except relocation) mitigate shareholder-unfriendly risks .
Peer benchmarking and governance signals:
- Compensation targets benchmarked to peer median; peer group includes insurers and asset managers (e.g., Ameriprise, Prudential, State Street, T. Rowe Price) .
- 2024 Say‑on‑Pay support ~96% indicates broad shareholder approval of program design .
Investment Implications
- Alignment: High equity and performance weighting (PSUs/RSUs and strict ownership rules) plus clawbacks and anti-hedging/pledging reduce agency risk; suggests incentives are geared to ROE/OM execution and relative TSR .
- Retention risk: Moderate; robust severance and double‑trigger CoC protections, plus significant unvested RSUs/PSUs likely anchor tenure; 1‑year non-compete limits competitive leakage .
- Trading signals: PSU payout at 88% for 2022–2024 cycle reflects disciplined performance calibration; large outstanding performance equity means future vesting is sensitive to non-GAAP ROE/OM delivery and relative TSR . High say-on-pay support and clear metric transparency reduce governance overhang .
- Watch items: Non-GAAP metrics and annual actuarial assumption review adjustments inform incentive scoring; investors should monitor quality of earnings (PrinPay components) and segment margin sustainability in Benefits & Protection, given underwriting-driven volatility highlighted by management .