Jim Lee
Chief Financial Officer at TGT
Executive
About Jim Lee
Jim Lee is Executive Vice President and Chief Financial Officer of Target Corporation, appointed effective September 22, 2024; he was 50 at appointment and remains a Section 16 executive officer. He holds an MBA from Columbia University and a BS in Operations Research from Princeton University, and previously served as PepsiCo’s Deputy CFO and in multiple global finance and strategy roles across North America, Europe, and Asia . In Target’s 2024 pay programs, executive incentives tied to Merchandise Sales, Incentive Operating Income, team scorecard, and peer-relative PSU/PBRSU performance resulted in an 83% STIP payout and below-target PSU outcomes, reinforcing a pay-for-performance framework CFOs are measured against .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| PepsiCo, Inc. | Deputy Chief Financial Officer | Nov 2023 – Sep 2024 | Oversaw global tax, treasury, IR, ESG reporting; led finance for international (~$35B revenue) . |
| PepsiCo, Inc. | SVP, Corporate Finance | Oct 2022 – Nov 2023 | Led corporate finance functions and planning . |
| PepsiCo Beverages North America | Chief Strategy & Transformation Officer; SVP | Feb 2019 – Oct 2022 | Led transformation, business development, M&A; FP&A and supply chain finance . |
External Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Celsius Holdings | Board service | Prior to 2024 | Strategic oversight in high-growth beverage category . |
| Tropicana Brands Group | Board service | Prior to 2024 | Governance for global juice JV . |
| North America Coffee Partnership | Board service | Prior to 2024 | Oversight of JV operations . |
Fixed Compensation
| Component | Amount/Terms | Source |
|---|---|---|
| Base Salary | $850,000 annually | |
| Target Annual Bonus (STIP) | 100% of base salary (pro-rated for Fiscal 2024) | |
| Sign-on Cash Bonus | $2,200,000; subject to clawback if voluntary termination or termination for cause within 36 months |
Performance Compensation
| Award Type | Structure | Metric Weighting | Target/Actual/Payout | Vesting | Source |
|---|---|---|---|---|---|
| Pro-rated FY2024 LTI | $1.5M target value; 60% PSUs, 40% PBRSUs | PSUs: 3 metrics equally weighted; PBRSUs: Relative TSR | PSU metrics: Adjusted Merchandise Sales CAGR, EPS CAGR, ROIC (peer-relative); PBRSU adjusts ±25 pts on TSR terciles | Standard 3-year performance cycles | |
| FY2024 STIP (program design) | Annual cash bonus | Financial 67% (Merchandise Sales, Incentive Operating Income); Team scorecard 33% | FY2024 Results: Merchandise Sales goal $105,776 vs actual $104,820 (99.1% → 82% payout); Incentive Operating Income goal $6,401 vs actual $5,994 (93.6% payout component); Team scorecard 85% → Overall 83% total payout | Paid after fiscal year-end | |
| FY2022 STIP (illustrative variability) | Annual cash bonus | Financial 67%; Team 33% | Sales $111,094 vs actual $107,588 (96.8%); Incentive Operating Income goal $9,632 vs actual $4,067 (42.2%); Team 75% → Total 41% payout | Paid after fiscal year-end | |
| LTI PSU (FY2022–FY2024 performance) | 3-year relative metrics | Equal weights: Sales CAGR, EPS CAGR, ROIC | Peer ranks: Sales 15/21 (42%); EPS 14/21 (40%); ROIC 8/21 (103%) → Overall ~62% PSU payout | Shares vest after 3 years | |
| LTI PBRSU (FY2022–FY2024) | Relative TSR | TSR rank 14/20 | TSR component payout scales; example shows 100% overall PBRSU factor with negative TSR adjustment shown as (37.0%) in disclosure table | Cliff vests after 3 years | |
| 2021–2023 PBRSU payout | Relative TSR | 3-year TSR rank 15/20 | 75% of goal shares earned | Cliff vest | |
| 2020–2023 PSU payout (4-year pandemic design) | Relative Sales, EPS, ROIC | Extended 4-year; capped at 150% | Overall payout 117.7% | Cliff vest |
Equity Ownership & Alignment
- Initial Form 3: “No securities are beneficially owned” at time of becoming an insider (filed Sept 26, 2024). This indicates zero initial beneficial holdings upon appointment, prior to awards vesting/accrual .
- Awards and vesting activity:
- Oct 2, 2024 Form 4 (report date Sep 30, 2024): reported equity grants under the 2020 LTI Plan (two award lines, including performance-based RSUs), consistent with appointment terms .
- Mar 14, 2025 Form 4: award acquisition of 9,942 shares (code A - Award), updating reported holdings .
- Oct 2, 2025 Form 4 (trade date Sep 30, 2025): 6,677 shares withheld to cover taxes upon vesting (code F), consistent with the scheduled RSU tranche; reported post-transaction holdings of approximately 53,170 shares .
- Sign-on RSU award: $6.95 million target value vesting one-third in September 2025, 2026, 2027; if involuntarily terminated without cause before a vesting date, 50% of unvested RSUs vest—adding retention value and partial downside protection .
- Stock ownership guidelines: CFOs (non-CEO executive officers) must hold stock equal to 3x base salary within five fiscal years; shares used include RSUs/PBRSUs at minimum payout and deferred equivalents, and prohibit counting options; executives must retain at least 50% of shares acquired until in compliance .
- Hedging/pledging: Executive officers may not hedge or pledge Target stock—reduces misalignment and financial risk .
Employment Terms
- Status: At-will; no fixed term .
- Severance eligibility: Covered by Target’s Income Continuation Plan; for NEOs, ICP typically provides up to 24 months’ salary and average STI (2x salary+bonus maximum) paid over 24 months, $30,000 outplacement, conditioned on release, non-compete, and non-solicit covenants .
- Change-in-control: Equity awards require “double trigger” (CIC plus involuntary termination or good reason) before vesting; Target discloses no tax gross-ups, clawback policy across incentive cash/equity/severance, and prohibits repricing of underwater options without shareholder approval .
Performance Compensation (Detailed Table)
| Metric | Weighting | Target | Actual | Payout | Vesting | Source |
|---|---|---|---|---|---|---|
| Merchandise Sales (FY2024 STIP) | 67% (financial) | $105,776M | $104,820M | 82% | Annual | |
| Incentive Operating Income (FY2024 STIP) | 67% (financial sub-metric) | $6,401M | $5,994M | 93.6% (component) | Annual | |
| Team Scorecard (FY2024 STIP) | 33% | N/A | 85% | 28.1% weighted | Annual | |
| Total STIP (FY2024) | — | — | — | 83% | Annual | |
| PSUs (FY2022–FY2024) Adjusted Merchandise Sales CAGR | 1/3 | Peer rank 15/21 | 42% of goal | 42% | 3-year | |
| PSUs (FY2022–FY2024) EPS CAGR | 1/3 | Peer rank 14/21 | 40% of goal | 40% | 3-year | |
| PSUs (FY2022–FY2024) ROIC | 1/3 | Peer rank 8/21 | 103% of goal | 103% | 3-year | |
| PBRSUs (FY2022–FY2024) Relative TSR | N/A | Peer rank 14/20 | TSR factor shown; overall PBRSU 100% | 100% | 3-year cliff | |
| PSUs (FY2020–FY2023, pandemic design) | Equal across metrics | — | Overall payout | 117.7% | 4-year |
Risk Indicators & Red Flags
- Insider selling pressure: No discretionary open-market sales identified; Form 4 shows tax withholding (code F) at vest, which is typical and not indicative of bearish view .
- Clawback policy and no gross-ups: Target maintains clawbacks and no tax gross-ups—shareholder-friendly design .
- Hedging/pledging prohibited: Reduces alignment risks .
- Legal/ethics oversight: CFO certifications under SOX 302/906 and signatory roles in 10-Q/10-K filings support accountability for controls and reporting .
Compensation Structure Analysis
- Shift toward performance equity: Pro-rated LTI with 60% PSUs and 40% PBRSUs emphasizes multi-year, peer-relative outcomes; PBRSUs use TSR terciles, PSUs use Adjusted Merchandise Sales, EPS, ROIC—strong alignment with profitable growth and capital discipline .
- Guaranteed vs at-risk: Base salary $850k and sign-on cash $2.2M are fixed; majority of ongoing compensation is at-risk via STIP/LTI per Target’s disclosed pay mix (Non-CEO NEOs at-risk ~83%) .
- Retention features: Three-year sign-on RSU vesting with partial acceleration (50%) on involuntary termination without cause strengthens retention but limits full forfeiture risk—balanced approach .
- Ownership discipline: 3x salary ownership guideline with mandatory holding until compliance; no hedging/pledging; clawbacks—mitigates agency risk .
Equity Ownership & Alignment (Snapshot Table)
| Item | Detail | Source |
|---|---|---|
| Form 3 (initial) | No securities beneficially owned at insider appointment | |
| Form 4 (Mar 14, 2025) | Award acquisition of 9,942 shares (code A) | |
| Form 4 (Oct 2, 2025; trade date Sep 30, 2025) | 6,677 shares withheld for taxes (code F); post-transaction holdings ~53,170 | |
| Ownership Guidelines | 3x salary; 5-year compliance window; retention requirements | |
| Pledging/Hedging | Prohibited for executive officers |
Employment Terms (Severance & CIC)
| Provision | Terms | Source |
|---|---|---|
| Employment Status | At-will; no specified term | |
| ICP Severance (NEO framework) | Up to 24 months; maximum 2x salary + 3-yr avg STI; $30k outplacement; subject to release, non-compete, non-solicit | |
| Change-in-Control | Double-trigger vesting required; no tax gross-ups; clawbacks apply |
Performance & Track Record
- Earnings call commentary: As CFO, Lee framed cautious sales outlook and mitigation plans (shrink, productivity, tariff scenarios) while preserving capacity to invest in brands and capital priorities—demonstrates disciplined financial stewardship under uncertainty .
- FY2024 incentive outcomes: STIP paid at 83% vs goal; PSUs below target on Sales/EPS peer ranks, stronger on ROIC; PBRSUs at 100% factor—aligns realized pay with performance .
Investment Implications
- Alignment and retention: Three-year sign-on RSUs, ownership guidelines, and prohibited hedging/pledging meaningfully align Lee with shareholders while limiting near-term voluntary sell pressure; tax-withholding transactions are mechanical, not directional .
- Pay-for-performance rigor: STIP and LTI design tie compensation to Merchandise Sales, Incentive Operating Income, and peer-relative Sales/EPS/ROIC/TSR, reinforcing focus on profitable growth and capital efficiency—positive for execution-driven equity narratives .
- Risk controls: Clawbacks, no gross-ups, double-trigger CIC, and ICP covenants reduce governance risk and adverse optics; at-will status offers flexibility but places emphasis on sustained performance .
- Monitoring signals: Watch annual LTI grants, PSU peer ranks (Sales/EPS/ROIC), and any non-F tax Form 4s; track compliance with 3x ownership guideline within five years to gauge “skin in the game” .