Christopher J. Nelson
STANLEY BLACK & DECKERAbout Christopher J. Nelson
Christopher J. Nelson, 55, is President & CEO of Stanley Black & Decker effective October 1, 2025 and joined SWK in June 2023 as COO and President, Tools & Outdoor . He previously led Carrier’s flagship HVAC segment and held leadership roles at the U.S. Army, Johnson & Johnson, and McKinsey; he holds a B.A. from Notre Dame and an MBA from Cornell . Company performance indicators relevant to his pay-for-performance framework: cumulative TSR value of a $100 investment was $56 in 2024 vs $186 for peer group; CAP was $7.77M for the PEO with average NEO CAP $2.55M; Net Income (GAAP) $294.3M and CFROI 9.4% in 2024 . SWK executed a transformation with strong cash generation and margin improvements in 2023 and continued cost-reduction milestones into 2025 .
| Metric | FY 2022 | FY 2023 | FY 2024 |
|---|---|---|---|
| Revenues ($USD) | $16,947,400,000 | $15,781,100,000 | $15,365,700,000* |
| EBITDA ($USD) | $1,481,300,000* | $1,194,400,000* | $1,545,500,000* |
Values retrieved from S&P Global.*
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Carrier Global | President, HVAC segment (global C/R portfolio) | 2020–2023 | Drove profitable growth, platform innovation, digital acceleration, JV oversight |
| Carrier Global | President, Commercial HVAC; President, North America HVAC | 2012–2020 | Grew segment share and optimized operations |
| SWK | COO & EVP; President, Tools & Outdoor | 2023–2025 | Streamlined, optimized around core brands; advanced ~$13B Tools & Outdoor roadmap |
| Prior (J&J, McKinsey, U.S. Army) | Leadership roles | Pre-2004 | Product, operations, strategy foundations |
External Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Johnson & Johnson | Leadership roles | Pre-2004 | Operations/process excellence |
| McKinsey & Company | Leadership roles | Pre-2004 | Strategy and transformation toolkit |
| U.S. Army | Leadership roles | Pre-2004 | Leadership under high-stakes conditions |
Fixed Compensation
| Component | 2023 | 2024 |
|---|---|---|
| Base Salary ($) | $850,000 | $850,000 |
| Target Bonus (% of Base) | 120% | 120% |
Performance Compensation
Annual MICP (Bonus) and Metrics
- 2024 MICP metrics: Adjusted EPS (30%), Free Cash Flow (40%), Adjusted Gross Margin Rate (30%); modifier tied to Adjusted Gross Margin up to +10% and 2025 TSR condition for modifier usage; divisional leaders (incl. Nelson) also measured on divisional operating profit, trade working capital, and adjusted gross margin rate .
- 2024 payout range for NEOs: 156.1%–173.6% of target; LTIP 2022–2024 paid 0% due to below-threshold performance .
- Mr. Nelson’s 2024 actual MICP paid: $1,592,220 ; target opportunity $1,020,000 . Payout = 156.1% of target (calculated from disclosed actual and target) .
| Metric (2023 MICP) | Weighting | Threshold | Target | Maximum | Actual (2023) | Payout Basis |
|---|---|---|---|---|---|---|
| Adjusted EPS | 33% | $0.00 | $1.00 | $2.00 | $1.45 | Above target |
| Free Cash Flow ($) | 34% | $500M | $700M | $1,000M | $852.6M | Above target |
| Adjusted Gross Margin Rate | 33% | 23.8% | 24.8% | 25.8% | 26.0% | Above max |
| Transformation Modifier | n/a | $800M | $900M | $1,000M | $1,035M | +20% |
| Mr. Nelson Bonus ($) | 2023 | 2024 |
|---|---|---|
| Actual MICP Paid | $1,351,500 | $1,592,220 |
Long-Term Incentives (LTIP PSUs, RSUs, Options)
- LTI mix: 50% PSUs, 25% stock options, 25% RSUs; three-year PSU cycles; options and RSUs vest ratably over three years starting grant date anniversary .
- 2023–2025 PSU metrics: CFROI (40%) threshold/target/max 8/9/10% (2023), rising in 2024–2025; Relative Organic Sales Growth vs Market (35%); Relative TSR vs S&P 500 Capital Goods (25%); negative TSR cap applies .
- 2024–2026 PSU metrics: CFROI 8/9/10% in 2024 rising to 10/11/12% in 2026; Relative Organic Sales Growth vs Market (35%); Relative TSR (25%) . 2025–2027 LTIP design shifts to add Adjusted EBITDA (45%), CFROI 30%, TSR 25% .
| Award Type | Grant Date | Quantity / Target | Exercise Price | Expiration | Grant-Date Value ($) |
|---|---|---|---|---|---|
| LTIP PSUs (Target) | 3/1/2024 | 23,499 | — | — | $1,900,012 |
| RSUs | 3/1/2024 | 10,634 | — | — | $950,042 |
| Stock Options | 3/1/2024 | 37,624 | $89.34 | 3/1/2034 | $950,006 |
| LTIP PSUs (Target) | 6/29/2023 | 19,421 | — | — | $1,800,006 |
| RSUs (annual) | 6/29/2023 | 9,641 | — | — | $899,988 |
| RSUs (make-whole) | 6/29/2023 | 58,918 | — | — | $5,499,995 |
| Stock Options | 6/29/2023 | 32,006 | $93.35 | 6/29/2033 | $900,009 |
Vesting schedules:
- RSUs: 1/3 annually on each anniversary of grant; for 3/1/2024 grant: expected vest 3/1/2025, 3/1/2026, 3/1/2027 ; make-whole RSUs granted 6/29/2023 also vest 1/3 annually .
- Options: 1/3 annually on each of the first three anniversaries; 10-year term; strike at grant date FMV .
Equity Ownership & Alignment
- Beneficial ownership as of Feb 28, 2025: 39,393 shares; less than 1% of class; includes 23,211 options exercisable by 4/29/2025 and 3,545 RSUs vesting by 4/29/2025 .
- Outstanding awards at FY2024 year-end: unvested RSUs 62,418 ($5,029,642 market value); unearned PSUs 13,316 ($1,072,987) and 7,121 ($573,842); unexercisable options 37,624 (2024 grant) and 21,337 (2023 grant) .
| Ownership Detail (12/28/2024 or 2/28/2025) | Shares / Units | $ Value |
|---|---|---|
| Common shares owned (2/28/2025) | 39,393 | n/a |
| Options exercisable (by 4/29/2025) | 23,211 | n/a |
| RSUs vesting by 4/29/2025 | 3,545 | n/a |
| RSUs unvested (12/28/2024) | 62,418 | $5,029,642 |
| PSUs unearned (12/28/2024) | 13,316 | $1,072,987 |
| Additional PSUs unearned (12/28/2024) | 7,121 | $573,842 |
| Options unexercisable (6/29/2023 grant) | 21,337 @ $93.35 | n/a |
| Options unexercisable (3/1/2024 grant) | 37,624 @ $89.34 | n/a |
Stock ownership policies:
- Executive ownership guidelines: COO 5x base salary; CEO 6x; five-year compliance window; RSUs count, unexercised options do not .
- Anti-hedging and anti-pledging policy for all directors/executives .
Insider selling pressure indicators:
- Three-year RSU and option vesting schedules imply potential selling windows around 6/29 annually (2023 grants) and 3/1 annually (2024 grants) .
- No disclosed pledging; hedging/pledging prohibited .
Employment Terms
Start date and role:
- Appointed COO/President, Tools & Outdoor effective ~June 14, 2023; base salary $850,000; 2023 LTI annual grant $3.6M (50% PSUs/25% options/25% RSUs); one-time RSUs $5.5M; 2023 MICP target 120% .
Change-in-control and severance:
- Standard CIC agreement: cash severance 2.5x base salary plus average 3-year bonus upon qualifying termination in connection with a change in control; double trigger required .
- 2025 Proxy termination provisions for Mr. Nelson (selected scenarios): see table below .
| Scenario | Severance ($) | Pro Rata Bonus ($) | RSU Vesting ($) | LTIP PSU Vesting ($) | Health & Welfare ($) | Outplacement ($) | Total ($) |
|---|---|---|---|---|---|---|---|
| Job Loss Event (no CIC) | $850,000 | $1,592,220 | $3,165,021 | — | $20,362 | — | $5,629,187 |
| Involuntary w/out Cause or Resign for Good Reason (upon CIC) | $5,804,650 | $1,020,000 | $4,539,823 | $3,458,494 | $50,904 | $50,000 | $15,513,187 |
| Disability | — | $1,592,220 | $4,539,823 | $2,136,659 | — | — | $8,268,702 |
| Death (Pre-retirement) | — | $1,592,220 | $4,539,823 | $2,136,659 | — | — | $8,268,702 |
Other terms:
- RSU acceleration triggers on make-whole grant: full vest if terminated without cause or if Board selects another CEO successor and Nelson resigns within 30 days .
- Clawback policies covering cash and equity for Section 16 officers; no excise tax gross-ups; double-trigger vesting in CIC .
- Perquisites include supplemental insurance, financial planning, exec physicals, limited product allowances; personal aircraft use restricted; no perquisite tax gross-ups except relocation .
CEO letter agreement (June 29, 2025):
- CEO base salary $1,300,000; 2025 MICP target: 160% for last 3 months (CEO) and 120% for first 9 months (COO) prorated; 2026 annual equity target $10,345,000; CEO promotion top-up equity $1,686,250 (50% PSUs/25% RSUs/25% options) after Effective Date .
- Severance (non-CIC): 2x base + target bonus; up to 2 years health/welfare; restrictive covenants (confidentiality, non-compete, non-solicit) and indemnification .
Board Governance
- Board service: Nelson will join the Board effective October 1, 2025 concurrent with becoming CEO . No committee assignments disclosed; as CEO, he is not independent .
- Governance structure: Independent Board Chair prior to Oct 1, 2025; after Oct 1, 2025, Donald Allan becomes Executive Chair and Andrea Ayers becomes Lead Independent Director, with plan to revert to Independent Chair after Allan’s retirement on Oct 1, 2026 .
- Board independence practices: all directors except CEO are independent; executive sessions each meeting; anti-hedging/pledging; robust ownership guidelines; clawback policies; double-trigger vesting .
Equity Ownership & Alignment
| Policy/Guideline | Requirement | Status |
|---|---|---|
| Executive stock ownership | COO: 5x salary; CEO: 6x; 5-year window; RSUs count; options don’t | Policy disclosed; individual compliance not disclosed |
| Hedging/pledging | Prohibited for directors, executives, employees | No pledging permitted |
Performance & Track Record
- Transformation outcomes in 2023: ~$835M run-rate savings in 2023; $1.0B since mid-2022; inventory reduced $1.9B since mid-2022; improved gross margin rate with four consecutive quarterly improvements; strong cash flow enabled debt reduction and dividend increase .
- Portfolio actions: agreement to divest STANLEY Infrastructure for $760M cash (Dec 2023) .
- Role fit: Board described Nelson as ideal to drive growth, innovation, and market share gains through platform and digital approaches .
Director Compensation
- As incoming CEO-director, no separate non-employee director retainer structure applies; non-employee director policies include ownership multiple of 500% retainer and deferred RSU programs (context) . No director committee fees relevant to Nelson disclosed.
Compensation Committee Analysis
- Pay philosophy: majority of pay is variable and tied to preset goals; target pay at ~50th percentile of peer group; strong governance with clawbacks, anti-hedging/pledging, no repricing or tax gross-ups (except relocation), double-trigger CIC vesting .
- Committee uses Pay Governance; annually calibrates goals and monitors alignment to performance (CAP, TSR, CFROI, Adjusted EPS, FCF) .
Say-on-Pay & Shareholder Feedback
- Three-year average Say-on-Pay support ~90.9%; 2024 support ~92.7%; 2025 vote recommended “FOR” given above-target MICP payouts and zero PSU payouts for 2022–2024 cycle, demonstrating rigor .
Investment Implications
- Pay-for-performance alignment is credible: 2024 cash bonus well above target due to corporate/divisional outperformance, while long-term PSU cycles can and did pay zero when below-threshold (2022–2024), limiting windfalls .
- Upcoming vesting events around 3/1 and 6/29 for RSUs/options may create periodic supply; monitor 10b5-1 plan filings and Form 4s near those dates for selling pressure indicators .
- Retention secured with CIC and non-CIC severance frameworks, plus CEO top-up award on promotion; acceleration triggers on 2023 make-whole RSUs mitigate forfeiture risk if succession path changes .
- Alignment safeguards (ownership multiples, anti-pledging, clawbacks) reduce governance risk; board’s independent leadership and planned return to independent chair strengthen oversight with Nelson as CEO-director .