Joel Pitz
PRINCIPAL FINANCIAL GROUPAbout Joel Pitz
Joel M. Pitz, age 52, was appointed Executive Vice President and Chief Financial Officer of Principal Financial Group (PFG) on May 19, 2025; he joined Principal in 1995 and served as Interim CFO beginning in August 2024 after roles including Senior Vice President & Controller (2021–Aug 2024) and CFO, Principal International (2016–2021) . PFG’s executive pay programs tie compensation to non-GAAP operating earnings, non-GAAP ROE, operating margin, customer revenue growth, free capital flow, and a diversity index; in 2024 the company’s annual incentive “PrinPay” score was 94% of target and 2022–2024 PSUs paid out at 88% of target, with PSU payouts subject to a relative TSR modifier vs S&P Financials constituents .
Past Roles
| Organization | Role | Years | Strategic impact |
|---|---|---|---|
| Principal Financial Group | Executive Vice President & CFO | 2025–present | Senior finance leadership, alignment of financial strategy to business goals |
| Principal Financial Group | Interim CFO | Aug 2024–May 2025 | Led finance organization during transition; received added RSU grant tied to interim role |
| Principal Financial Group | SVP & Controller | 2021–Aug 2024 | Oversaw control environment and corporate accounting |
| Principal Financial Group | CFO, Principal International | 2016–2021 | Oversaw global finance and strategy for international/emerging markets |
Fixed Compensation
| Component | 2024 | 2025 CFO terms |
|---|---|---|
| Base salary ($) | $409,615 (SCT reported); base salary level set at $420,000 for 2024 | $552,500 (effective May 19, 2025) |
| Target annual bonus (% of base) | 80% | 200% |
| Actual annual bonus paid ($) | $338,834 (paid 2025 for 2024 performance) | Not disclosed |
| Perquisites ($) | $7,473 | Not disclosed |
| Company retirement contributions ($) | $36,635 total: 401(k) match $17,250; Excess Plan match $19,385 | Not disclosed |
| Total “All Other Compensation” ($) | $44,108 | Not disclosed |
Performance Compensation
Annual Incentive (PrinPay)
- Program metrics: non-GAAP operating earnings, managed net cash flow, free capital flow payout ratio, customer revenue growth, diversity index .
- 2024 company score achieved: 94% of target; individual modifiers for NEOs ranged 95%–110% .
- Pitz’s 2024 target: 80% of base; actual non-equity incentive compensation paid: $338,834 .
| Metric | Weighting | Target | Actual (2024) | Payout Impact |
|---|---|---|---|---|
| Non-GAAP operating earnings | Not disclosed | Company goal set by HRC | Contributed to 94% company score | Forms corporate score component |
| Managed net cash flow | Not disclosed | Company goal set by HRC | Included in company score | As above |
| Free capital flow payout ratio | Not disclosed | Company goal set by HRC | Included in company score | As above |
| Customer revenue growth | Not disclosed | Company goal set by HRC | Included in company score | As above |
| Diversity index | Not disclosed | Company goal set by HRC | Included in company score | As above |
Long-Term Incentives (PSUs/RSUs)
- 2024 LTI mix: 70% PSUs, 30% time-based RSUs (three-year cliff vesting) .
- PSU metrics and scale (2024–2026 cycle): payout based on 3-year average non-GAAP ROE (50%) and Operating Margin (50%), with relative TSR modifier (0.8x bottom quartile, 1.0x mid, 1.2x top quartile); thresholds and targets below .
| 2024–2026 PSU Performance Scale | Threshold | Target | Maximum |
|---|---|---|---|
| Payout (% of target) | 50% | 100% | 150% |
| Avg Non-GAAP ROE | 7.5% | 14.1% | 18.4% |
| Operating Margin | 15.1% | 30.2% | 39.3% |
| RTSR modifier | 0.8x bottom quartile; 1.0x mid; 1.2x top quartile |
| 2024 Grants (Plan-Based Awards) | Grant date | PSUs (Th/Tgt/Max) | RSUs (#) | Grant date fair value ($) |
|---|---|---|---|---|
| Annual LTI | 02/26/2024 | 1,101 / 5,505 / 9,909 | 2,359 | $441,006 (PSUs); $188,979 (RSUs) |
| Interim CFO RSUs | 08/20/2024 | — | 5,183 | $400,024 |
| 2024 total LTI “Award Granted” | — | — | — | $630,000 (aggregate award granted) |
| Historical PSU/RSU Vesting Outcomes | Event date | Shares vested/paid | Value realized |
|---|---|---|---|
| 2022–2024 PSUs settled | Feb 24, 2025 | Paid at 88% of target; market price $85.11 | Company-wide values disclosed (individual value not itemized) |
| 2021 RSUs vested | Feb 5, 2024 | Included in 2024 vestings | Market price $80.99 |
| Pitz 2024 stock awards vested | 2024 | 7,519 shares | $625,370 |
| Options exercised (2024) | 2024 | 0 (Pitz) | $0 |
- RSU vesting: “All RSUs vest on the third anniversary of the grant date”; Pitz’s interim RSU grant occurred Aug 20, 2024 (three-year cliff vesting) .
Equity Ownership & Alignment
| Item | Detail |
|---|---|
| Beneficial ownership (as of Mar 10, 2025) | 22,867 shares; percent outstanding indicated “*” (less than 1%) |
| Stock ownership guidelines | Interim CFO: 2x base salary multiple; retention ratio: retain 50% of net profit shares until guideline met; all NEOs comply |
| Hedging/pledging | Prohibited for Section 16 officers including NEOs (no pledging, margin, derivatives) |
| Repricing policy | No option repricing without shareholder approval |
| Deferred compensation balance | Aggregate balance: $645,156 (end of 2024) |
| Deferrals (2024) | Employee deferral: $32,769; Company match: $19,385; earnings: $87,561 |
| 2024 Option Exercises & Stock Vested (Pitz) | Shares | Value realized |
|---|---|---|
| Option exercises | 0 | $0 |
| Stock awards vested | 7,519 | $625,370 |
Employment Terms
| CFO Appointment Terms (effective May 19, 2025) | Detail |
|---|---|
| Base salary | $552,500 |
| Target annual incentive | 200% of base |
| Long-term incentive target | $2,348,125 in RSUs |
| Severance Plan (involuntary termination not for cause) | Pitz provisions |
|---|---|
| Lump sum severance | 1.5x annual base salary + 1.5x average bonus (last 3 full years) + 1.5 years health benefit premiums (COBRA equivalent) |
| Illustrative amounts (as of Dec 31, 2024) | Severance $1,134,000; Outplacement $40,000; COBRA reimbursement $24,682; Total $1,198,682 |
| Eligibility caveats | Not eligible if taking comparable job at Company or failing to sign release, etc. |
| Change-of-Control Employment Agreement (termination without cause or for good reason) | Terms |
|---|---|
| Cash severance | Lump sum = 2x (base salary + target annual bonus) |
| Equity | Immediate vesting of all options, SARs, restricted stock, PSAs/PSUs/RSUs/DSUs |
| Bonus | Prorated annual bonus for year of termination (net of bonus paid at CoC) |
| Benefits | Continued medical, dental, vision, life, AD&D for executive and family up to 3 years post-termination |
| Legal fee reimbursement | Covered to enforce agreement |
| Non-compete / non-solicit | 1-year prohibition on working for competitors, soliciting employees/customers, or interfering with relationships |
- Clawbacks: Mandatory recovery policy per SEC Rule 10D/Nasdaq for erroneously awarded incentive comp; discretionary policy extends to misconduct causing significant financial/reputational harm, including failure to manage/report risks; Committee discretion applies .
- Tax gross-ups: No excise tax gross-ups; relocation benefits receive income tax gross-up for all employees .
Related Party Transactions (Governance)
- Kristine Pitz (Director—Accounting), spouse of Joel M. Pitz, employed since 1995; 2024 compensation $225,033, approved by HRC; stated as commensurate with peers .
- Other large shareholders and affiliate relationships disclosed are with Vanguard, BlackRock, and Nippon Life; no pledging by NEOs permitted under policy .
Compensation Structure Analysis
- Mix and risk: 2024 LTI granted 70% PSUs (three-year performance on non-GAAP ROE and operating margin) and 30% RSUs (three-year cliff), reinforcing pay-for-performance with retention features .
- Annual pay outcomes: 2024 company score 94% of target; Pitz’s non-equity incentive paid $338,834, consistent with pay-for-performance linkage and interim role transition .
- PSU rigor: 2024–2026 targets require 14.1% average non-GAAP ROE and 30.2% operating margin for target payout, with up/down RTSR modifier vs S&P Financials constituents (80%–120%) .
- No repricing / hedging / pledging: Policies lower governance risk and alignment concerns .
Equity Ownership & Alignment Details
| Ownership guideline compliance | Hedging/Pledging | Vested vs Unvested |
|---|---|---|
| Interim CFO must hold 2x salary; all NEOs in compliance | Prohibited across options/derivatives/margin and pledging | 2024 vesting occurred (7,519 shares; $625,370 realized); future RSUs vest on 3-year cliff from grants |
Employment Terms (Additional)
| Deferred Compensation (Excess/NQDC) | 2024 activity |
|---|---|
| Employee contributions | $32,769 |
| Company contributions | $19,385 |
| Aggregate earnings | $87,561 |
| End-of-year balance | $645,156 |
Say-on-Pay & Peer Benchmarking
- 2024 say-on-pay approval: ~96% support, indicating strong shareholder endorsement of program design .
- Benchmarking: LTI sizing considered peer medians; pay-versus-performance comparison uses S&P 500 Financials Index .
Investment Implications
- Alignment: High at-risk mix (PSUs/RSUs) tied to ROE and operating margin with RTSR overlay supports alignment; hedging/pledging prohibitions and ownership requirements (2x salary for CFO) reduce misalignment risk .
- Retention: Interim RSU grant ($400,024) with three-year cliff plus 2025 CFO package (200% bonus target; $2.348M RSU LTI target) suggest robust retention incentives through 2027 vesting windows .
- Performance signals: 2024 annual incentives paid against a 94% corporate score and 2022–2024 PSUs at 88% reflect disciplined payout against tough operating margin/ROE targets; not indicative of outsized discretionary awards .
- Change-of-control/Severance economics: Standard double-trigger CoC terms (2x pay + accelerated vesting) and severance (1.5x pay/bonus + COBRA) are competitive but not aggressive (no excise tax gross-ups), limiting shareholder-unfriendly payout risk .
- Trading pressure: 2024 vesting value realized ($625,370) and upcoming three-year RSU cliffs can create predictable liquidity events around vest dates; absence of option exercises and hedging/pledging prohibitions reduce opportunistic selling risk .