Paola Arbour
TENET HEALTHCAREAbout Paola Arbour
Paola M. Arbour is Executive Vice President and Chief Information Officer (CIO) at Tenet Healthcare, appointed CIO in May 2018 and EVP in March 2019; she is 61 and holds a bachelor’s degree in Telecommunications Arts & Sciences from Michigan State University . In 2024, Tenet delivered strong enterprise performance: Adjusted EBITDA grew 13% YoY, consolidated Adjusted EBITDA margin reached 19.3%, and free cash flow was ~$1.1B; relative TSR for the 2022–2024 performance cycle ranked 1st vs direct peers, applying a +25% multiplier to earned PRSUs . Her 2024 individual review cited enterprise-wide cybersecurity deployment, data center consolidation, and standardized technology support across Tenet/Conifer/USPI/TPR; her AIP individual performance multiplier was 125% .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| ProV International | President | Nov 2017 – Apr 2018 | Led technology consulting operations immediately prior to joining Tenet . |
| ServiceNow | VP Services Global Delivery | Jul 2016 – Sep 2017 | Scaled global delivery for enterprise SaaS services . |
| Dell Services | VP of Service Delivery | Dec 2010 – Apr 2016 | Led large-scale IT service delivery transformation . |
| Electronic Data Systems (EDS) | Multiple IT operations leadership roles (HQ, London, Frankfurt) | 1985 – 2009 | Ran complex international IT operations and infrastructure programs . |
External Roles
| Organization | Role | Years | Notes |
|---|---|---|---|
| Texas Capital Bancshares, Inc. | Director | Since Jul 2021 | Current public company directorship . |
Fixed Compensation
| Component (2024) | Amount | Notes |
|---|---|---|
| Base Salary | $550,000 | As of Dec 31, 2024. |
| Target Bonus % | 75% of base | AIP target set by HR Committee. |
| Actual AIP (2024) | $1,031,250 | Corporate pool funded at 200%; individual multiplier 125%; compliance modifier 0% . |
| Cash Retention Bonus | $500,000 | Granted Jun 2024; repayable if resigns without good reason/terminated for cause before Jun 21, 2026 . |
| All Other Compensation | $121,390 | Includes $10,350 401(k) match, $110,000 ERA company contribution, ~$1,040 perqs; no DCP match in 2024 . |
Multi-year compensation (Summary Compensation Table):
| Metric | 2022 | 2023 | 2024 |
|---|---|---|---|
| Salary ($) | $540,192 | $550,000 | $550,000 |
| Bonus ($) | $0 | $0 | $500,000 |
| Stock Awards ($) | $684,713 | $807,541 | $1,177,043 |
| Non-Equity Incentive Plan Comp ($) | $363,000 | $990,000 | $1,031,250 |
| All Other Comp ($) | $119,171 | $119,900 | $121,390 |
| Total ($) | $1,707,076 | $2,467,441 | $3,379,683 |
Performance Compensation
2024 Annual Incentive Plan (AIP) structure and results:
| Metric | Weighting | Target | Actual vs Target | Weighted Payout |
|---|---|---|---|---|
| Adjusted EBITDA | 70% | $3.995B | 200% | 140% |
| Adjusted FCF Less NCI | 30% | $588M | 200% | 60% |
| Final Corporate Funding Pool | — | — | — | 200% of Target |
| Individual Performance Multiplier (Arbour) | — | — | — | 125% |
| Compliance Modifier | — | — | — | 0% |
| Arbour Final AIP | — | Target $412,500 | Calculated $825,000 | Actual $1,031,250 |
2024 Long-Term Incentive (LTI) awards:
- Mix: 50% time-based RSUs (ratable vest over 3 years); 50% performance-based RSUs (three-year performance, Adjusted EPS and Adjusted FCF Less NCI with cumulative 3-year Relative TSR +/-25% modifier; overall max 250%) .
- Target Grant Values (Feb 2024): Time-based RSUs $500,078; Performance-based RSUs $500,078; Total $1,000,156 (priced at $89.22 on grant date) .
- 2024 PRSU tranche counts recorded for 2024 accounting: 1,868 units (2024 PRSU 1st tranche); prior-cycle tranches: 2,799 units (2023 PRSU 2nd tranche), 2,107 units (2022 PRSU 3rd tranche) .
- 2022 PRSUs earned at 199.7% with 1st-place Relative TSR (125% multiplier); vested Feb 23, 2025 .
Vesting schedules (key dates and conditions):
- Time-based RSUs vest in equal annual installments on each of the first three anniversaries of the grant date (2/23/22, 3/1/23, 2/28/24) .
- Performance-based RSUs: 2022 PRSUs vested 2/23/2025 at certified results; 2023 PRSUs vest 3/1/2026; 2024 PRSUs vest 2/28/2027, subject to performance and Relative TSR modifier .
Equity Ownership & Alignment
Beneficial ownership (as of March 3, 2025):
- Shares beneficially owned: 34,309; percent of class: “*” (less than 1%); no shares pledged .
- Stock ownership guidelines: EVPs must hold stock worth 2x base salary; all NEOs are in compliance or on track; anti-hedging and anti-pledging policies in place .
Outstanding equity awards (as of Dec 31, 2024):
| Grant Date | Type | Unvested/Unearned Units (#) | Market/Payout Value ($) |
|---|---|---|---|
| 2/23/2022 | Time-based RSUs | 2,107 | $265,967 |
| 2/23/2022 | Performance-based RSUs (earned 199.7%) | 12,622 | $1,593,275 |
| 3/1/2023 | Time-based RSUs | 5,598 | $706,636 |
| 3/1/2023 | Performance-based RSUs (max eligible first/second tranches) | 12,596 | $1,589,930 |
| 2/28/2024 | Time-based RSUs | 5,605 | $707,519 |
| 2/28/2024 | Performance-based RSUs (2024 tranche; max eligible) | 4,670 | $589,494 |
2024 vesting activity:
- Shares acquired on vesting (2024): 24,751; value realized: $2,301,063 .
- No stock option exercises in 2024; no options granted in 2024 .
Guidelines, hedging/pledging, and compliance:
- Anti-hedging and anti-pledging policy prohibits short sales/derivatives/pledging; directors and executives cannot hedge or pledge Company stock .
- All NEOs certify compliance before selling Company stock; directors/execs maintain ownership/retention requirements (EVP = 2x salary) .
Employment Terms
Severance Plan (ESP) – non-cause termination outside change-of-control (applies to Arbour):
- Cash severance over 1.5 years equal to base salary plus “bonus” (for Arbour, bonus equals target bonus) .
- Lump-sum pro-rata AIP bonus for year of termination; continued medical/dental/vision/life/LTC coverage during severance period (employee contribution; reduced if comparable benefits obtained); outplacement up to $25,000 .
- Equity treatment: time-vested RSUs and options vest upon non-cause termination; performance-based RSUs vest subject to satisfaction of performance criteria with proration for incomplete periods; Feb 2022 amendment provides continued vesting for Arbour even if award agreements wouldn’t otherwise allow (retentive feature) .
- No excise tax gross-ups on change-of-control severance benefits under ESP .
Restraints and policies:
- Non-compete, confidentiality, non-disparagement, and non-solicit covenants apply as a condition of severance; non-compete and related covenants remain in effect for at least the severance period .
- Clawbacks: AIP awards subject to misconduct-based clawback; Rule 10D-1 NYSE policy mandates recovery of excess incentive comp after a required restatement (past 3 fiscal years) .
Deferred compensation and retirement:
- Deferred Compensation Plan (DCP) balance: $70,984; ERA balance: $834,568 (2024 company contribution to ERA: $110,000); Arbour did not make DCP contributions in 2024 .
- SERP is frozen; NEOs (including Arbour) do not participate .
Performance & Track Record
- 2024 enterprise metrics used for compensation show Tenet met or exceeded challenging targets amid portfolio divestitures, funding the AIP pool at 200% on Adjusted EBITDA and Adjusted FCF Less NCI .
- 2022 PRSU cycle earned 199.7% with 1st-place relative TSR vs HCA, UHS, CYH, demonstrating strong multi-year shareholder return alignment .
- 2024 CIO achievements: complete data center decommissioning/consolidation; cloud-enabled telephony and secure wireless across hospitals; enterprise deployment of AI-enabled cybersecurity; standardized technology support with KPIs across Tenet/Conifer/USPI/TPR .
Compensation Structure Analysis
- Equity mix is 100% RSUs (time-based and performance-based); no 2024 stock options granted, reducing optionality and emphasizing share/FCF/EPS outcomes with TSR moderation .
- Introduction of $500,000 cash retention bonus (repayable if departure before 6/21/2026) increases guaranteed cash and retentive value during transformation, while AIP/PRSUs maintain significant at-risk pay .
- Best-practice governance: no option repricing/backdating; cap payouts; independent consultant; ownership/retention requirements; anti-hedging/pledging; robust clawbacks .
Equity Ownership & Alignment (Skin-in-the-game)
| Item | Detail |
|---|---|
| Beneficial ownership | 34,309 shares; <1% of class; no pledging . |
| Ownership guidelines | EVP must hold 2x base salary; NEOs in compliance or on track . |
| Hedging/pledging | Prohibited for directors/executives . |
| Upcoming vesting events | Time-based RSUs: annual vesting each Feb/Mar through 2026–2027; PRSUs: 3/1/2026 and 2/28/2027 subject to performance (potential supply events) . |
Employment & Contracts (Retention risk, transition analysis)
- Tenure: CIO since May 2018; EVP since Mar 2019 (7+ years as CIO) .
- ESP terms provide meaningful income continuity and equity vesting/continued vesting (as amended) upon non-cause termination, mitigating immediate departure risk but potentially enabling post-termination equity realization .
- Non-compete applies during severance period; non-solicit/confidentiality/non-disparagement enforced as condition to benefits .
Governance, Peers, and Shareholder Feedback
- Compensation peer group includes direct hospital peers (HCA, UHS, CYH) and adjacent healthcare companies used to benchmark competitiveness; independent consultant advises HR Committee .
- Say-on-pay approval was >96% in 2024, signaling strong investor support for program design .
Investment Implications
- Alignment: High pay-for-performance linkage via AIP (EBITDA/FCF) and PRSUs (EPS/FCF with TSR modifier); 2022 cycle at ~200% plus 1st-place TSR suggests disciplined execution and shareholder alignment .
- Retention risk: 2024 $500k retention cash with clawback if departure before 6/21/2026 reduces near-term flight risk; continued vesting provisions further stabilize retention during portfolio transformation .
- Selling pressure: Time-based and performance-based RSU vestings in Feb/Mar 2026–2027 create foreseeable liquidity windows; 2024 vesting realized $2.30M, so expect similar calendar-based supply around vest dates subject to 10b5-1/blackout windows .
- Ownership and risk controls: Beneficial ownership (34,309 shares), strict anti-hedging/anti-pledging, and 2x salary ownership guideline for EVPs offer solid alignment; absence of related-party transactions and presence of robust clawbacks lower governance risk .
- Structural shift: No options in 2024 and RSU-heavy mix modestly lowers optionality but emphasizes cash generation and earnings quality; with strong 2024 corporate outperformance and deleveraging, technology execution under Arbour supports margin resilience and risk management (cyber), underpinning multiple expansion arguments contingent on sustained performance .