Ruben Velasquez
STEPANAbout Ruben Velasquez
Ruben D. Velasquez is Vice President and Chief Financial Officer of Stepan Company, appointed effective July 15, 2025 (age 51) . He holds an MBA from Northwestern University and a BS in Industrial Engineering from Universidad de Los Andes; prior roles include senior finance leadership across 3M and earlier at Ecopetrol . Company performance context at his onboarding: year-to-date 2025 net sales rose 7% to $1.78B and adjusted EBITDA increased 9% to $165.1M ; longer-term TSR was $68 per $100 initial investment for 2024 versus $97 in 2023, reflecting recent share price pressure into early 2025 . As CFO, Velasquez signed SOX 302/906 certifications on SCL’s Q2 and Q3 2025 10-Qs, underscoring accountability for disclosure controls and fair presentation .
Past Roles
| Organization | Role | Years | Strategic impact |
|---|---|---|---|
| 3M Company | VP Global Finance Transformation | 2022–2024 | Led enterprise finance transformation initiatives |
| 3M Company | VP Global Finance & CFO, Manufacturing & Supply Chain | 2021–2022 | Oversaw global operations finance and supply chain cost productivity |
| 3M Company | VP Global Finance & CFO, Consumer Business | 2016–2021 | Drove portfolio profitability and pricing discipline in consumer segment |
| 3M Company | Global Finance Director & CFO, Electronics Materials Solutions Division | 2013–2016 | Managed divisional FP&A and capital allocation |
| 3M Russia | Finance Director & Country CFO | 2010–2013 | Led country finance and risk management amid macro volatility |
| 3M Colombia | Finance Director & Country CFO | 2006–2010 | Strengthened local compliance and reporting |
| Ecopetrol | Finance Director Corporate FP&A & Treasury; Interim VP & Corporate CFO | Prior to 2006 | Corporate finance leadership in oil & gas |
External Roles
- None disclosed beyond corporate executive positions .
Fixed Compensation
| Component | Terms | Amount |
|---|---|---|
| Base salary | Annual | $475,000 |
| Target annual bonus (STIP) | % of base salary | 75% |
| Initial RSU grant (Aug 2025) | Time-vested; same vesting as other execs | $200,000 |
| Initial Performance Shares (Aug 2025) | Performance-vested; same conditions as other execs | $100,000 |
| Initial SARs (Aug 2025) | 10-year term; grant price = avg open/close on grant date; ratable vesting | $100,000 |
| Standard RSU vesting cadence | Ratable over 3 years | Policy level |
| Standard SAR vesting cadence | Ratable over 3 years; 10-year term | Policy level |
Performance Compensation
| Metric | Weighting | Target | Actual (2024 Company) | Payout impact | Notes/Vesting |
|---|---|---|---|---|---|
| Corporate Net Income | Not disclosed; largest weighting among corporate metrics | $70.2M | $50.5M | 0% of salary earned | 2024 PSUs forfeited company-wide due to below-threshold net income |
| Corporate EBITDA | Not disclosed | $248.0M | $187.0M | 0% of salary earned | Added to STIP metrics in 2024 to align with market practice |
| Corporate Growth Goal (profit in strategic areas) | Not disclosed; smallest weighting among corporate metrics | $750.0M | $692.3M | 0% of salary earned | Categories: Rigid Polyols, Functional Products, Tier 2/3 Surfactant Customers |
- Annual incentives for 2024 paid to certain NEOs on a discretionary basis due to one-time impacts; CFO Velasquez joined in 2025 and was not part of 2024 payouts .
- Velasquez’s initial 2025 PSU/RSU/SAR awards follow executive plan terms; RSUs/SARs vest ratably over three years; PSUs vest based on plan performance conditions .
Equity Ownership & Alignment
| Item | Detail |
|---|---|
| Form 3 (initial statement) | Filed July 15, 2025; “No securities beneficially owned” at appointment |
| Form 4 (initial grants) | Filed Aug 2025, reporting initial PSU/RSU/SAR awards consistent with plan terms |
| Ownership guidelines | CFO required to hold shares valued at 2.5× base salary; 5 years to reach compliance; annual compliance review |
| Hedging/short sales | Prohibited under Insider Trading Policy |
| Pledging | No pledging disclosed for Velasquez; policy emphasizes hedging/short selling prohibitions |
| Alignment notes | New grants are equity-heavy (RSUs/PSUs/SARs), with performance linkage and three-year vesting |
Employment Terms
| Provision | Terms |
|---|---|
| Appointment date | July 15, 2025 |
| Contract term | No guaranteed employment or compensation contracts; compensation set by HCCC |
| Severance (standing) | Company does not maintain standing severance/change-in-control cash agreements for executives |
| Change-in-control (equity) | Under 2022 Equity Plan: RSUs/SARs vest in full and PSUs vest at target upon qualifying events (no replacement awards at change-in-control, or qualifying termination within 2 years if replacement awards granted) |
| Clawback | SEC/NYSE-compliant clawback for incentive comp paid in prior 3 fiscal years upon a restatement; previous policy enforced for willful misconduct |
| Non-compete/Non-solicit | Not disclosed for Velasquez; company may negotiate case-by-case separation terms |
Performance & Track Record
- CFO certifications: Velasquez signed SOX 302 (Ex. 31.2) and SOX 906 (Ex. 32) certifications on Q2 and Q3 2025 10-Qs, attesting to effective disclosure controls and fair presentation .
- Earnings call commentary: As CFO, he presented detailed bridges for adjusted net income and EBITDA, called out raw material inflation, startup costs at the Pasadena alkoxylation facility, and environmental reserve items, and highlighted lower effective tax rate drivers (discrete items) .
- Company YTD 2025 results: Net sales $1,778M (+7% YoY), adjusted EBITDA $165.1M (+9% YoY), with segment mix shifts; surfactant margins compressed by oleochemical costs and startup expenses; polymers benefited from competitor exit in phthalic anhydride .
Compensation Structure Analysis
- Equity-heavy onboarding: $400k in initial LTI (RSUs/PSUs/SARs) versus $475k base and 75% bonus target, signaling alignment with long-term shareholder value creation .
- Strong governance guardrails: No tax gross-ups, no option/SAR repricing without shareholder approval, clawback in place, and prohibition on hedging/shorting .
- Metric rigor: Corporate Net Income, EBITDA, and a strategic growth profit goal drive annual incentives; 2024 outcomes delivered zero formulaic payouts on corporate metrics, indicating discipline in pay-for-performance .
Vesting Schedules and Insider Selling Pressure
- RSUs and SARs vest ratably over three years; SARs have 10-year terms at grant price (avg open/close on grant date), creating periodic vesting events rather than large single cliffs .
- PSUs vest only upon meeting plan performance conditions; company-wide forfeiture of 2024 PSUs demonstrates sensitivity to underperformance and reduces near-term sell pressure from vesting .
- Initial Form 3 showed no holdings at appointment; subsequent equity awards are unvested, indicating minimal immediate selling overhang attributable to Velasquez .
Risk Indicators & Red Flags
- Environmental and regulatory items: Company accrued remediation at Millsdale and paid a $1.126M FIFRA penalty in 2025 (partial recovery achieved), factors CFO flagged in discussions; these are corporate risks rather than personal red flags .
- Governance-positive features: No excise tax gross-ups, no standing severance, clawback enforcement, independent HCCC oversight .
Compensation Peer Group & Say-on-Pay
- Peer group: AdvanSix, Ashland, Avient, Cabot, Chemours, H.B. Fuller, Innospec, Koppers, NewMarket, Quaker Chemical, RPM, Sensient .
- Say-on-Pay: 96% approval in 2024, supporting design credibility entering Velasquez’s tenure .
Investment Implications
- Alignment: Velasquez’s package is equity-weighted with three-year vesting and PSU performance hurdles, aligned with long-term value creation and supportive of retention (five-year ownership guideline to 2.5× salary) .
- Selling pressure: Limited near-term overhang—initial Form 3 showed no holdings; early awards are unvested and vest ratably, likely smoothing any future sales cadence .
- Execution focus: CFO commentary emphasizes margin recovery plans (raw material pass-through), Pasadena ramp, and disciplined cost controls; however, surfactant margin compression and environmental reserves require continued oversight on EBITDA trajectory .
- Governance risk is low given clawback, no repricing, no standing severance, and strong HCCC oversight—reducing pay-related controversy risk as he moves toward ownership guideline compliance over five years .