Kent Pflederer
Executive Vice President and Chief Financial Officer at PKG
Executive
About Kent Pflederer
Kent A. Pflederer (age 54) became Executive Vice President and Chief Financial Officer of Packaging Corporation of America (PCA) on May 1, 2025; he previously served as Senior Vice President, General Counsel and Corporate Secretary since 2013 and led PCA’s legal department since 2007, after roles at Hospira (Senior Counsel, 2004–2007) and Mayer Brown (corporate/securities practice, 1996–2004) . As CFO, he signed PCA’s Q2 and Q3 2025 certifications and earnings filings, and he executed financing documents tied to PCA’s 2025 debt issuance and Greif containerboard acquisition integration . PCA’s performance context during his elevation: 2024 EPS rose to $8.93 GAAP and $9.04 excluding special items; corrugated products volume grew over 10% YoY; operating cash flow was ~$1.191B, capex ~$670M, and free cash flow ~$521M; one-/three-/five‑year TSR were 41.7%/81.9%/135.2% respectively .
Past Roles
| Organization | Role | Years | Strategic impact |
|---|---|---|---|
| Packaging Corporation of America | Executive Vice President & Chief Financial Officer | 2025–present | Elevated from GC to CFO; signed SOX certifications and 2025 earnings filings; executed financing documents for 2025 senior notes, supporting strategic M&A (Greif containerboard acquisition) . |
| Packaging Corporation of America | Senior Vice President, General Counsel & Corporate Secretary | 2013–2025 | Led legal function; corporate secretary; described by CEO as a trusted advisor to the board/CEO with strong accounting and finance background . |
| Packaging Corporation of America | Vice President, General Counsel & Secretary | 2007–2013 | Built and led PCA’s legal department beginning 2007 . |
| Hospira, Inc. | Senior Counsel, Corporate & Securities | 2004–2007 | Corporate/securities legal leadership prior to PCA . |
| Mayer Brown LLP | Corporate & Securities Associate | 1996–2004 | Large‑cap corporate/securities practice foundation . |
External Roles
- None disclosed in PCA’s 10-K/DEF 14A/8-K filings for public company directorships or committee roles .
Fixed Compensation
| Component | Value | Effective date | Notes |
|---|---|---|---|
| Base salary | $750,000 | May 1, 2025 | Set upon appointment to EVP & CFO; eligible for annual incentive (EICP) and equity awards under Long‑Term Equity Incentive Plan; no new agreements entered in connection with appointment; no related‑party transactions disclosed . |
Performance Compensation
| Incentive | Metric | Weighting | Target | Actual | Payout | Vesting/Timing |
|---|---|---|---|---|---|---|
| Annual cash incentive (EICP, company program design) | EPS excluding special items | 100% (annual) | $7.50 | $9.04 (FY2024) | 139% of target | Paid after year‑end based on matrix; EICP is the framework for PCA officers (CFO eligible) . |
| Long‑term: ROIC Performance Units | Relative ROIC vs peer group | N/A (LTI tranche) | Relative schedule | 2021 award cycle certified at 2nd‑highest average ROIC | 114% of target | 4‑year performance period; cliff vest on 4th anniversary; 0–120% payout; peer set disclosed . |
| Long‑term: TSR Performance Units | Relative TSR vs peer group | N/A (LTI tranche) | Relative schedule | 3/1/2021–2/28/2024 TSR at 88th percentile | 176.4% of target | 3‑year performance period; 0–200% payout; linear interpolation; peer set disclosed . |
| Long‑term: Time‑vesting Restricted Stock | Service condition | N/A | N/A | N/A | N/A | Cliff vests 4 years after grant (awards typically granted late February with other NEO awards) . |
LTI structure (for PCA executives): equal‑value mix of time‑vested RS, ROIC Units, and TSR Units; awards granted on a cadence concurrent with 10‑K approval (historically February) .
Equity Ownership & Alignment
- Stock ownership guidelines: 6x base salary (CEO); 4.5x for Executive and Senior VPs first elected before 2019; 3x for other executive officers. Participants must reach guideline within five years; compliance is monitored and PCA states all NEOs/directors are compliant or making adequate progress .
- Hedging/pledging: PCA prohibits hedging, short‑selling, and pledging by directors and executive officers; blackout windows apply, and trades require pre‑clearance by the CEO and insider trading compliance officer .
- Clawback: Policy requires recovery of erroneously awarded incentive compensation following a financial restatement (three prior fiscal years); TSR is treated as a financial reporting measure for clawback estimation .
- Option practices: No option grants since 2007; plan prohibits repricing without shareholder approval; minimum vesting standards are embedded; no excise tax gross‑ups in plan; no “single‑trigger” vesting on change‑of‑control .
Employment Terms
- Employment agreements: PCA states no employment contracts with executive officers; no contractual severance; any severance/retirement transition considered case‑by‑case by the Compensation Committee .
- Change‑of‑control: Double‑trigger for equity (requires qualifying termination or resignation for good reason within two years of a change‑of‑control if substitute award is provided; otherwise equity accelerates); no guaranteed cash CIC benefits .
- Trading/blackouts: Formal insider trading policy with blackout periods and pre‑clearance; communications to the Board routed via the Corporate Secretary (role held by Mr. Pflederer through his GC tenure) .
Performance & Track Record (Company context during/preceding CFO appointment)
- 2024 operating/financial highlights: Corrugated products volume +10% YoY; record containerboard production; Jackson mill conversion completed; GAAP EPS $8.93; EPS excluding special items $9.04; operating cash flow ~$1.191B, capex ~$670M, free cash flow ~$521M; year‑end cash and marketable securities ~$852M .
- Shareholder returns: Cumulative TSR (assuming reinvested dividends) one-/three-/five‑year: 41.7%/81.9%/135.2% .
- Capital markets/M&A execution in 2025: Closed ~$1.8B acquisition of Greif’s containerboard business (effective Aug 31, 2025); financed via ~$300M cash and ~$1.5B new borrowings/senior notes; CFO executed SEC documents/agreements for related financings .
- Say‑on‑pay: Support has been strong—at least 93% in each of the last five years; 2024 vote nearly 94% .
Compensation Committee & Peer Framework
- Committee: 2024 Compensation Committee—Thomas S. Souleles (Chair), Karen E. Gowland, Samuel M. Mencoff, Roger B. Porter; met six times in 2024; only independent directors serve .
- Advisors: FW Cook serves as independent advisor to the Committee; management retains Meridian for benchmarking/valuation support; FW Cook attested independence .
- Benchmark peers: Broad packaging/basic materials/manufacturing set (e.g., IP, Smurfit WestRock, Graphic Packaging, Greif, Berry, Avery Dennison, Sherwin‑Williams, PPG, etc.); PCA’s 2024 revenue near peer median; market cap around 75th percentile; one‑year TSR above 75th percentile; three‑year TSR highest of the group .
Vesting Schedules and Potential Selling Pressure
- Vesting cadence: PCA grants typically in late February; RS cliff vests at four years from grant; TSR Units vest on the third anniversary after performance certification; ROIC Units vest on the fourth anniversary after certification. Historical payouts/certifications have concentrated in late February–March (e.g., 2024 and 2025 award cycles) .
- Policy mitigants: Blackouts and pre‑clearance for officers; hedging/pledging prohibited; presence of clawback policy reduces risk of opportunistic trading around financial reporting .
- Form 4 activity: Not detailed in proxy/10‑K; Section 16 compliance stated (no delinquencies in 2024) .
Quantitative Detail – Annual Incentive Framework (FY 2024)
| Metric (EPS ex‑special items) | Threshold | Target | Maximum | Actual | Payout |
|---|---|---|---|---|---|
| EICP matrix (companywide) | $5.63 | $7.50 | $9.75 | $9.04 | 139% of target |
Equity Plan Mechanics (for PCA executives)
| Feature | ROIC Units | TSR Units | Restricted Stock |
|---|---|---|---|
| Performance/condition | Relative ROIC vs peer group | Relative TSR vs peer group (20‑day VWAP start/end) | Service only |
| Payout range | 0–120% | 0–200% | N/A |
| Vesting | Cliff on 4th anniversary | Vest after 3‑year performance period | Cliff on 4th anniversary |
| Recent attained results | 2021 grant cycle certified at 114% (2nd‑highest average ROIC) | 2021 grant cycle paid at 176.4% (88th percentile TSR) | N/A |
| Sources |
Investment Implications
- Alignment and discipline: Pay design (EPS‑based annual bonus; ROIC/TSR‑based LTI; 4‑year RS cliffs; clawback; anti‑hedging/pledging; double‑trigger CIC) points to strong pay‑for‑performance alignment and muted windfall risk; absence of employment/severance agreements reduces “golden parachute” risk .
- Transition risk/continuity: Elevation of a long‑tenured insider with legal, governance, and finance familiarity (and CEO’s endorsement) supports continuity through 2025 M&A and financing; watch early execution markers—debt integration metrics and synergy capture from the Greif assets .
- Trading signals: Expect concentrated vesting windows in late Feb–Mar (historically) but pre‑clearance and blackout policies should temper opportunistic selling; monitor Form 4s around vesting/earnings windows for any sell‑to‑cover patterns. Proxy indicates no Section 16 delinquencies in 2024 and prohibits pledging/hedging .
- Governance support: Strong say‑on‑pay outcomes and independent committee/advisor structure reduce headline risk around compensation and encourage continuity in incentive design .