John Faulk
SERVICE CORP INTERNATIONALAbout John Faulk
John H. Faulk is Senior Vice President and Chief Operating Officer of Service Corporation International (SCI), promoted effective October 1, 2024 from Senior Vice President, Revenue & Business Development as part of SCI’s succession planning initiative . SCI’s recent operating performance provides context for his role: adjusted EPS was $3.53 in 2024, adjusted operating cash flow reached $977 million, revenue was $4.2 billion, and preneed sales production totaled ~$2.6 billion with a $16 billion preneed backlog; SCI delivered a 316% total shareholder return over the last ten fiscal years .
Past Roles
| Organization | Role | Years | Strategic impact |
|---|---|---|---|
| Service Corporation International | Senior Vice President, Revenue & Business Development | Prior to Oct 1, 2024 | Promoted to COO as part of Board-led succession planning |
External Roles
- Not disclosed in SCI’s proxy; no public external directorships or roles are listed for Faulk.
Fixed Compensation
| Item | 2024 | Notes |
|---|---|---|
| Base salary | $490,000 | Set within competitive benchmarks |
| Target bonus (% of base) | 80% | Unchanged from 2023 |
| Actual non‑equity incentive paid | $281,391 | Reflects 72% plan payout for 2024 |
| All Other Compensation (total) | $253,707 | See breakdown below |
| Contributions to Deferred Compensation Plan | $165,416 | Company contributions |
| Contributions to 401(k) Plan | $25,875 | Company match subject to limits |
| Life insurance related | $3,497 | Premiums for supplemental coverage |
| Perquisites & personal benefits | $58,919 (incl. aircraft $28,044) | Medical reimbursement, tax/financial planning |
| Current base salary as of Mar 11, 2025 | $550,000 | Per employment agreement summary |
Performance Compensation
Annual Performance-Based Incentive (Cash) – 2024
| Metric | Weighting | Target | Actual | Payout |
|---|---|---|---|---|
| Normalized EPS | 1/3 | $3.65 | $3.48 | 15% |
| Normalized Free Cash Flow per Share | 1/3 | $4.11 | $4.40 | 200% |
| Comparable Preneed Production | 1/3 | 102.5% | 98.8% | 0% |
| Customer Satisfaction (Google stars) modifier | Downward if <4.25 | 4.25 | 4.65 | No downward adjustment |
| Total payout vs target | — | — | — | 72% |
2024 Long-Term Incentive Grants (Equity)
| Instrument | Grant date | Quantity | Exercise price | Vesting | Grant date fair value |
|---|---|---|---|---|---|
| Performance Units (shares) | Feb 14, 2024 | Target 3,660; Threshold 915; Max 7,320 | — | 3-year (2024–2026); 0–200% payout on Relative TSR vs S&P MidCap 400; ROE modifier; pro‑rata vesting on certain separations; double‑trigger vesting at target on change‑of‑control if not assumed | $364,261 |
| Restricted Stock | Feb 14, 2024 | 3,660 | — | 1/3 per year | $255,797 |
| Stock Options | Feb 14, 2024 | 14,500 | $70.58 | 1/3 per year; 8‑year term | $250,534 |
Long-Term Performance Outcome (prior cycle)
| Cycle | Metric | Result |
|---|---|---|
| 2022–2024 | Relative TSR vs S&P MidCap 400 | 125% performance factor (SCI 3‑yr TSR 18% between 50th–75th percentile; ROE modifier not applied as SCI avg normalized ROE 32.3% > 13.3% for index) |
Scheduled Vesting and Insider Supply Calendar
| Award type | Date | Shares |
|---|---|---|
| Restricted Stock | 03/05/2025 | 3,450 |
| Restricted Stock | 03/05/2026 | 2,320 |
| Restricted Stock | 03/05/2027 | 1,220 |
| Options (2030 grant) | 02/16/2025 | Remaining 100% vests |
| Options (2031 grant) | 02/16/2025; 02/15/2026 | 50% each tranche |
| Options (2032 grant) | 02/16/2025; 02/15/2026; 02/14/2027 | 33% each tranche |
| Performance Units (max schedule) | 02/17/2025; 02/16/2026; 02/15/2027 | 6,780; 6,600; 7,320 respectively (subject to TSR outcomes) |
Equity Ownership & Alignment
| Measure | Value |
|---|---|
| Shares owned (direct/indirect) | 54,681 |
| Options exercisable within 60 days | 141,999 |
| Total beneficial ownership | 196,680 |
| Ownership as % of shares outstanding | <1% (“*” per table) |
| Unvested restricted stock (market value) | 6,990; $557,942 |
| Unearned performance units (market value at max) | 20,700; $1,652,274 |
| Unexercisable options outstanding | 30,134 (6,367 + 9,267 + 14,500) |
| Stock ownership guideline (multiple of salary) | 3x; minimum shares 18,382; actual multiple 8; guideline exceeded |
| Anti‑hedging/pledging | Hedging and pledging prohibited for Officers/Directors |
| Retention requirement | Must retain shares from grants until guideline met |
Deferred Compensation
- 2024 executive contributions: salary $58,731; annual incentive $34,948; total $93,679 .
- Registrant contributions: $165,416; aggregate 2024 earnings $631,477; aggregate distributions $152,259; balance at year‑end $3,316,923 .
- Company contributions vest over three years; immediate vesting on death, disability, change‑of‑control, or termination not for cause; discretionary full vesting at certain retirements .
Employment Terms
- Agreement term: current terms expire December 31, 2025 (renewable annually unless notice given) .
- Severance (without cause): 2 years’ salary continuation, prorated annual bonus, 18 months health benefits .
- Death/disability: salary continuation (through end of term for death; 24 weeks for disability), prorated annual bonus, 18 months health benefits .
- Change‑of‑control (double‑trigger): 3x (salary + Target Bonus) lump sum, prorated Target Bonus at change‑of‑control, 18 months health benefits .
- Non‑compete: Company option to impose for 1 year (extendable to 2); pays base salary during non‑compete unless for cause or voluntary termination outside specified window .
- Equity vesting on change‑of‑control: single‑trigger removed for awards granted 2022+; vesting only if awards not assumed/replaced or on qualifying termination within 60 days before to 2 years after change‑of‑control .
- Clawback: adopted 2023; restatement‑based recovery of cash/equity incentives for current/former executive officers (no indemnity/insurance allowed) .
- Policies: no tax gross‑ups; no hedging/pledging; no option repricing without shareholder approval .
Potential Payments (as of Dec 31, 2024)
| Scenario | Salary & Bonus | Long‑Term Incentives | Other Benefits | Total |
|---|---|---|---|---|
| Involuntary not for cause | $1,261,391 | $1,544,212 | $254,758 | $3,060,361 |
| Disability | $507,545 | $1,544,212 | $254,758 | $2,306,515 |
| Death | $771,391 | $1,544,212 | $3,254,758 | $5,570,361 |
| Change‑of‑control (involuntary or good reason) | $3,038,000 | $1,832,835 | $254,758 | $5,125,593 |
Investment Implications
- Pay-for-performance alignment: Annual cash incentives tied to normalized EPS, normalized FCF/share, and preneed production, with clear thresholds and a customer satisfaction modifier; 2024 payout at 72% shows discipline when operational growth lagged in preneed while FCF outperformed . Long‑term incentives mix (options, RS, PSUs) ties realizations to TSR against S&P MidCap 400 with an ROE floor, reinforcing capital efficiency and shareholder returns .
- Ownership alignment and selling pressure: Faulk exceeds ownership guidelines (8x salary vs 3x required) and is subject to anti‑hedging/pledging and retention rules, which mitigate misalignment risk; however, notable vesting dates in 2025–2027 (RS, options, PUP) are relevant for monitoring potential insider sale windows and supply .
- Retention and change‑of‑control economics: Robust severance and change‑of‑control protections (3x salary+Target Bonus; double‑trigger equity vesting for 2022+ grants) lower near‑term retention risk but increase transaction‑related costs; clawback provisions and no tax gross‑ups indicate shareholder‑friendly governance .
- Company performance context: Strong cash generation and long‑term TSR support incentive realizations; watch execution on preneed insurance transition and comparable preneed production recovery given its direct impact on annual incentive metrics .
SCI’s 2024 say‑on‑pay received 83.2% support, suggesting investor approval of the program’s structure and outcomes . The company also reported timely Section 16 filings in 2024 with one late Form 4 for a director—no issues noted for Faulk—which reduces governance red flags related to insider reporting .