Malavika Sagar
TE ConnectivityAbout Malavika Sagar
Senior Vice President and Chief Human Resources Officer (CHRO) at TE Connectivity (TEL), age 43, with 12 years at TE and 1 year in the CHRO role as of January 13, 2025. She became CHRO in April 2023 after leading HR for Transportation Solutions (Mar 2019–Apr 2023) and earlier roles driving HR for Global Automotive, Industrial Commercial Transportation, Application Tooling, and global talent, diversity and succession; she holds a bachelor’s in Business/Marketing and a master’s in Human Resource Management from Rutgers University . Company performance under the executive incentive framework in FY2024 included net sales of $15.8B, a record GAAP operating margin of 17.6%, record GAAP net income of $3,193M, GAAP EPS of $10.34, cash from operations ~$3.5B, and ~24.5% TSR, which are the core drivers of executive pay-for-performance .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| TE Connectivity | VP of Human Resources, Transportation Solutions | Mar 2019–Apr 2023 | Led HR for Transportation Solutions; previously led HR for Global Automotive, ICT, Application Tooling; drove talent, diversity, and succession practices . |
| TE Connectivity | CHRO | Apr 2023–present | Executive leadership of global HR; alignment of incentive frameworks, succession, and human capital strategy across segments . |
External Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Avaya | HR business partner and international HR assignments | 2004–2012 | International HR leadership experience; cross-border HR execution and policy implementation . |
Fixed Compensation
- Not individually disclosed for Ms. Sagar (not a Named Executive Officer (NEO) in the proxy). TE’s program includes base salary as fixed cash compensation, set via the MDCC’s market and performance assessment process .
Performance Compensation
Executive officer annual incentives and long-term incentives (PSUs and stock options) are set and overseen by the MDCC; payouts are formulaic against financial and operational metrics with clawbacks and ownership requirements.
FY2024 Annual Incentive Framework (Corporate)
| Metric | Weight | 1H FY2024 Target | 1H FY2024 Actual | Score | 2H FY2024 Target | 2H FY2024 Actual | Score | FY2024 Result |
|---|---|---|---|---|---|---|---|---|
| EPS (adjusted) | 20% | $3.50–$3.75 | $3.67 | 100.0% | $3.52–$3.82 | $3.82 | 101.2% | 100.6% |
| Revenue (adjusted) | 30% | $7,750–$8,010 | $7,688 | 89.9% | $7,920–$8,150 | $8,051 | 100.0% | 94.9% |
| Operating Income (adjusted) | 30% | $1,330–$1,455 | $1,453 | 100.0% | $1,345–$1,470 | $1,508 | 123.0% | 111.5% |
| KPI (company-weighted) | 20% | Company-weighted KPI score (*) | — | 147.1% | Company-weighted KPI score (*) | — | — | 147.1% |
| Corporate Earned Award | — | — | — | — | — | — | — | 112.6% |
Notes: The KPI is a revenue-weighted composite of business-unit KPIs; specific KPI targets/results are withheld to prevent competitive harm . Financial metrics are adjusted for defined non-GAAP items reviewed annually by MDCC .
FY2024 Annual Incentive Mechanics and Weighting
| Element | Corporate | Transportation Solutions | Communications Solutions |
|---|---|---|---|
| EPS (adjusted) | 20% | 20% | 20% |
| Revenue (adjusted) | 30% | 25% | 30% |
| Operating Income (adjusted) | 30% | 35% | 30% |
| KPI (weighted) | 20% | 20% | 20% |
- Payout curve: threshold 50% at 90–95% of target, target 100%, max 200% (metric-level discretionary up to 300% for exceptional outperformance; individual awards capped at 200% of target; additional cap if operating income < target) .
- Two performance intervals (1H and 2H) with a single year-end payout; continued in FY2025 to maintain rigor amid dynamic conditions .
Long-Term Incentive Design (applies to executives)
| Feature | Performance Stock Units (PSUs) | Stock Options |
|---|---|---|
| Vehicle purpose | Multi-year performance alignment; EPS growth vs peers | Drive shareholder value via price appreciation |
| Performance/Term | 3-year average relative EPS growth vs S&P 500 Non-Financial Index | 10-year option term |
| Vesting | Cliff at certification after year 3; payout 50%–200% at 25th/50th/75th percentile | 25% per year starting ≥12 months after grant (4 tranches) |
| Dividends | Dividend equivalents vest pro-rata to PSUs earned | Not applicable |
| Grant timing | Generally Q1 open window; grants priced at NYSE close; policy avoids timing around MNPI |
- FY2022 PSU cycle vested at 108% of target (illustrative NEO outcomes), confirming the program’s linkage to multi-year EPS performance .
Equity Ownership & Alignment
| Policy/Practice | Details |
|---|---|
| Stock ownership guidelines | CEO 6x base; CFO & other executive officers 3x base; to be achieved within 5 years; if not met, 100% of after-tax vested shares/options must be held until compliant; eligible share types include owned, unvested RSUs, earned PSUs, plan units, and beneficially owned family shares . |
| Hedging & pledging | Executives and directors are prohibited from hedging (derivatives, shorts, collars, swaps) and pledging TE securities or using margin accounts . |
| Insider trading controls | Trading windows, MNPI restrictions, and corporate policies embedded in exhibits to 10-K; policy oversight by Audit Committee and Ombudsman . |
| Clawback | NYSE-mandated incentive compensation recovery: recapture of erroneously awarded incentive-based comp tied to restatements or deficient financial information; additional remedies for misconduct . |
| Beneficial ownership snapshot | Directors/NEOs and nominees as a group held 2,036,670 shares (0.9% outstanding) as of Jan 13, 2025; individual holdings for Ms. Sagar are not disclosed . |
Employment Terms
| Provision | Term |
|---|---|
| Notice period | Up to 12 months, with continued base salary, eligibility for bonus (per plan), continued vesting per award terms, and continued benefits . |
| Post-notice compensation | Twelve months’ pay post-notice consideration for non-compete and non-solicitation covenants . |
| Change-in-control (CoC) equity | Qualifying involuntary termination or “good reason” within 12 months post-CoC: PSUs vest at target; stock options and RSUs fully vest . |
| Tax treatment | No excise tax gross-ups; “best net” approach vs 280G cutback—greater after-tax amount vs cutback to avoid excise tax . |
| U.S. severance & CoC plans | TE Connectivity Change in Control Severance Plan for Certain U.S. Executives (amended and restated 9/30/2024) and TE Severance Plan for U.S. Executives (amended and restated 9/30/2024) are listed exhibits (coverage is plan-defined) . |
| Deferred comp & vesting | SSRP permits deferrals and discretionary credits; post-2017 matching/company credits vest 100% from 9/29/2017; certain credits vest upon CoC or at company-specified events . |
Compensation Governance, Peer Group, and Say‑on‑Pay
- Governance and MDCC independence: Programs reviewed annually; independent consultant (Pay Governance); material risks assessed—none reasonably likely to have a material adverse effect in FY2024 .
- Peer group (21 companies) used for market alignment and design (e.g., Amphenol, Aptiv, Corning, Eaton, Honeywell, ITW, NXP, Parker-Hannifin, Rockwell, Texas Instruments, Trane, etc.) .
- Say-on-Pay approval ~93% in FY2024, supporting program alignment with shareholder interests .
Track Record and Execution Signals
| Performance Dimension | FY2024 Outcomes | Implications |
|---|---|---|
| Sales & Profitability | Net sales $15.8B; GAAP operating margin 17.6% (record); record GAAP net income $3,193M; GAAP EPS $10.34 | Supports above-target AIP outcomes; validates EPS, operating income and KPI design. |
| Cash Generation | Cash from operations ~$3.5B; free cash flow framework consistent with capital returns | Sustains LT equity value creation capacity. |
| Capital Returns | ~$2.8B returned to shareholders in FY2024 | Reinforces TSR linkage and option value. |
| TSR | ~24.5% including dividends in FY2024 | Confirms pay-for-performance alignment for equity‑linked awards. |
Risk Indicators & Red Flags
- Hedging/pledging explicitly prohibited for executives, mitigating alignment risk; equity grant timing policy designed to avoid MNPI timing concerns .
- Clawbacks extend beyond restatements to deficient information and misconduct, strengthening recourse .
- No individual Form 4 trading or ownership details for Ms. Sagar surfaced in proxies/10‑K; monitor SEC filings for insider transactions to assess selling pressure (not available in reviewed documents) .
Investment Implications
- Compensation alignment: Executive incentives are tightly coupled to EPS, revenue, operating income, and KPIs with rigorous payout caps and clawbacks, reducing pay‑for‑performance drift risk .
- Retention and CoC protections: 12‑month notice, continued vesting, and CoC accelerations at target mitigate flight risk for key talent like the CHRO, while “best net” tax treatment avoids shareholder‑unfriendly gross‑ups .
- Ownership alignment: 3x salary ownership guidelines (5‑year compliance window) and absolute prohibitions on hedging/pledging support long‑term alignment; absence of disclosed individual holdings for Ms. Sagar warrants continued monitoring of ownership/compliance status .
- Trading signals: Without Form 4 data for Ms. Sagar in reviewed documents, no direct insider‑selling pressure indicators are observable; track future Section 16 filings and vesting calendars for signal generation .