Shawn G. Lisle
STEPANAbout Shawn G. Lisle
Vice President, General Counsel and Secretary of Stepan Company (SCL); evidenced by 8‑K filings signed by “Shawn G. Lisle, Vice President, General Counsel and Secretary” as of October 14, 2025 . He assumed the role following the announced retirement of prior GC David G. Kabbes effective March 14, 2025 . Company context for incentive alignment: 2024 GAAP net income was $50.4 million and adjusted net income was $50.5 million; TSR value of a fixed $100 investment was $68 versus $138 for the Dow Jones U.S. Chemicals Index peer group .
Past Roles
Not disclosed in available company filings. Evidence of current role and timing is provided via 8‑K signatures and the prior GC’s retirement notice .
External Roles
Not disclosed in available company filings reviewed.
Fixed Compensation
Executive officer pay structure: base salary plus target short‑term incentive (Management Incentive Plan) and long‑term equity (RSUs, SARs, PSUs), with GC historically treated as a Named Executive Officer (NEO). The most recent GC (David G. Kabbes) provides a benchmark for role economics.
| Metric (GC precedent – David G. Kabbes) | 2022 | 2023 | 2024 |
|---|---|---|---|
| Base Salary ($) | 442,500 | 460,833 | 474,440 |
| Target Bonus (% of Salary) | 65% | 65% | 65% |
| Actual Bonus Paid (% of Salary) | 0% (no award) | 0% (no award) | 16% |
| Stock Awards ($) | 230,691 | 487,672 | 434,822 |
| Option/SAR Awards ($) | 360,005 | 150,019 | 150,014 |
| All Other Compensation ($) | 62,694 | 53,549 | 53,108 |
| Total Compensation ($) | 1,521,786 | 1,152,073 | 1,188,333 |
Notes:
- Kabbes’ 2024 bonus was discretionary despite corporate metrics below threshold, reflecting Committee’s uniform approach to reward and retention; CEO opted out to increase pool for other executives .
- Executive pay mix emphasizes at‑risk, performance‑based compensation; no standing individual severance or change‑in‑control cash agreements, no excise tax gross‑ups .
Performance Compensation
Company’s short-term incentive for executive officers (including GC as NEO historically) linked to corporate metrics plus individual objectives; in 2024 EBITDA was added to align with market practice .
| Metric | Weighting Framework | Threshold | Target | Maximum | 2024 Actual | Payout Result |
|---|---|---|---|---|---|---|
| Corporate Net Income | Largest weighting among corporate metrics; at least 30% of NEO incentive tied to corporate objectives | $56.0m | $70.2m | $98.0m | $50.5m | 0% (below threshold) |
| Corporate EBITDA | Added in 2024; smaller weighting than Net Income | $198.0m | $248.0m | — | $187.0m | 0% (below threshold) |
| Corporate Growth Goal (profit in strategic areas) | Smallest weighting among corporate metrics | $704.0m | $750.0m | — | $692.3m | 0% (below threshold) |
Discretionary overlay in 2024:
- Committee approved uniform discretionary bonuses to current employees/NEOs considering one‑time impacts and retention needs; CEO opted out; GC (Kabbes) received 16% of salary .
Long-term incentive design and vesting:
- SARs: 10‑year term, granted at average of open/close price, vest ratably over 3 years, stock‑settled .
- RSUs: vest ratably over 3 years, stock‑settled .
- Performance Shares (PSUs): initial 1‑year Corporate Net Income gate (50–150% of target shares), plus ROIC modifier (+/‑30%); 2024 grant forfeited entirely due to below‑threshold net income . Special CEO PSUs in Oct‑2024 with share‑price hurdles vesting at Dec‑31‑2027 if thresholds are met .
Illustrative GC vesting schedule (Kabbes):
- RSUs vesting tranches and dates (455–571 share increments through 2027) .
- SAR tranches and vesting dates (multi‑year ladder through 2027) .
Equity Ownership & Alignment
Policies applicable to executive officers (including the GC role) emphasize alignment and retention.
| Policy/Status | Disclosure |
|---|---|
| Stock Ownership Guidelines | CEO: 5× base salary; other executive officers (e.g., GC): 2.5× base salary; 5‑year compliance window with staged progress (80% by year 4, 100% by year 5); reduction allowances starting at age 61 up to 50% by age 65 . |
| Compliance Status | Committee determined all executive officers were in compliance as of February 2025 (at that time, GC was Kabbes) . |
| Hedging/Short‑Selling | Prohibited for directors, officers, covered employees; pre‑clearance and trading‑window restrictions apply . |
| Pledging | Security ownership table footnotes include shares “pledged as security” in reporting conventions; no specific pledging disclosed for the GC or for Lisle . |
Beneficial ownership benchmark (prior GC):
- David G. Kabbes beneficially owned 20,945 shares as of March 3, 2025, including ESOP II allocation (402 shares), 7,967 options exercisable and 571 RSUs scheduled to vest; details in ownership footnotes .
Employment Terms
Company‑level terms governing executive officers and equity awards; Stepan does not use standing severance/change‑in‑control cash agreements for executives (including GC), but equity plans include specific provisions.
| Element | Key Terms |
|---|---|
| Severance | No standing cash severance agreements; separation agreements may be used case‑by‑case (e.g., prior CEO) . |
| Change‑in‑Control (2022 Plan) | If no replacement award: RSUs/SARs vest in full and PSUs vest at target upon change‑in‑control; if a replacement award is granted: full vesting upon qualifying termination within two years post‑CoC (double trigger); 2011 Plan had different acceleration rules . |
| Death/Disability/Retirement | RSUs/SARs: full vesting on death/disability; pro‑rata on retirement. PSUs: pro‑rata outstanding and eligible to vest based on actual performance for retirement; full eligibility for death/disability . |
| Clawback | Restatement clawback compliant with SEC/NYSE; applies regardless of fault for three completed fiscal years preceding restatement; prior version limited to willful misconduct/fraud and 12 months . |
| Perquisites | Limited; includes company‑leased vehicle, occasional spousal travel, LTD “top‑up,” relocation benefits; one company-owned condominium allowed for personal use at incremental cost . |
Performance & Track Record
- 2024: GAAP net income $50.4m; adjusted net income $50.5m; Surfactants operating income +18% YoY, Polymers −33% YoY, Specialty Products +82% YoY; dividend increased for 57th consecutive year; Say‑on‑Pay approval 96% .
- Pay vs Performance: 2024 TSR value $68 vs peers $138; CAP analytics disclosed per Item 402(v) .
Compensation Structure Analysis (Management Confidence Signals)
- Year‑over‑year shift: introduction of EBITDA as a corporate metric in 2024 (alignment with market practice) .
- At‑risk pay upheld: forfeiture of PSUs for 2023 and 2024 grants due to below‑threshold net income, demonstrating pay‑for‑performance discipline .
- Discretionary annual incentives in 2024 despite metric misses: uniform awards to current employees reflect retention priorities and one‑time headwinds; CEO opt‑out increased pool to others, including GC .
- No excise tax gross‑ups; no standing individual severance/change‑in‑control cash agreements; clawback broadened—shareholder‑friendly posture .
Equity Ownership & Retention Pressure Indicators
- Hedging barred; short‑selling prohibited; trading windows and pre‑clearance reduce opportunistic selling—lower immediate selling pressure risk .
- Ownership guidelines (2.5× salary for GC‑equivalents) with 5‑year runway support alignment; noncompliant executives must retain 100% of vested LTI shares until compliant .
- Pledging is tracked in ownership reporting, but no pledging disclosed for GC role or for Lisle in filings reviewed .
Employment Terms – Change‑of‑Control Economics
- Double‑trigger vesting under the 2022 Plan if replacement awards are issued; single‑trigger full vesting if no replacement awards—equity acceleration remains the principal CoC economic lever for executives including the GC .
Say‑on‑Pay & Shareholder Feedback
- Say‑on‑Pay approved at 96% (2024) and 98% (2023), indicating strong investor support for program design despite discretionary bonus usage and PSU forfeitures .
Expertise & Qualifications
- Public filings confirm appointment to the GC/Secretary role (legal and corporate governance leadership); additional educational/professional history is not detailed in available documents .
Work History & Career Trajectory
- Transition timing evidenced by prior GC retirement notice (Jan 29, 2025) and Lisle’s subsequent 8‑K signature as GC/Secretary (Oct 14, 2025) .
Compensation Committee Analysis
- Independent consultant (Exequity) engaged; peer group includes small/mid‑cap specialty chemical peers; program overseen by independent Compensation Committee—robust governance .
Investment Implications
- For an incoming GC, equity is the dominant change‑in‑control lever; no guaranteed severance or tax gross‑ups—limited cash risk, equity acceleration potential on CoC .
- Pay‑for‑performance discipline is evident via PSU forfeitures tied to net income gates; discretionary bonuses (16% of salary for prior GC) in 2024 signal retention emphasis amidst missed corporate targets .
- Alignment frameworks (ownership guidelines, hedging ban, clawback) lower misalignment and insider selling risk; monitor Forms 4 for Lisle post‑appointment to assess actual skin‑in‑the‑game and any selling pressure over vest schedules .
- Company TSR underperformed the peer index in 2024; improving Surfactants/Specialty Products OI and continued dividend increases support longer‑term value narrative; compensation metrics now include EBITDA, which may better capture operating momentum .