Steven Oakland
TreeHouse FoodsAbout Steven Oakland
Steven Oakland, age 64, is Chairman, Chief Executive Officer and President of TreeHouse Foods (THS), serving as CEO since March 26, 2018 and appointed Chairman in April 2023; he holds a B.A. in Marketing and Economics from the University of Mount Union . TreeHouse’s 2024 performance included net sales of $3,354.0 million (-2.3% YoY) and adjusted EBITDA of $337.4 million (-7.8% YoY), with cash from operations of $265.8 million and free cash flow of $126.1 million . Over 2022–2024, THS’s three-year TSR ranked at the 44th percentile of its peer group; CEO realizable pay ranked at the 38th percentile, indicating pay aligned with performance . In 2024, THS highlighted continued progress in supply chain savings and capital allocation (including ~$150 million of share repurchases) while navigating macro and recall-related headwinds .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| The J.M. Smucker Company | Vice Chair & President, U.S. Food & Beverage | May 2016 – Feb 2018 | Senior P&L leadership across branded food; deep retailer/manufacturer strategy experience |
| The J.M. Smucker Company | President, Coffee & Foodservice | Apr 2015 – Apr 2016 | Led coffee and foodservice categories; customer engagement and portfolio execution |
| The J.M. Smucker Company | President, International Food Service | May 2011 – Mar 2015 | International operations leadership; quality and strategic planning |
| The J.M. Smucker Company | President, U.S. Retail – Jif & Hungry Jack | Aug 2008 – May 2011 | U.S. retail brand stewardship; marketing and brand-building |
| The J.M. Smucker Company | General Manager, Canada | 1995 – 1999 | Country GM leadership; cross-border operations and market development |
External Roles
| Organization | Role | Years | Notes |
|---|---|---|---|
| Foot Locker, Inc. (NYSE: FL) | Director | Current | Public company board experience in retail; brings customer and consumer insights |
Fixed Compensation
| Component | Amount/Terms | 2024 Outcomes |
|---|---|---|
| Base Salary | $1,102,000 | No change in 2024 |
| Target Short-Term Incentive (STIP) | 130% of base salary ($1,432,600 target) | STIP payout 0% for 2024 (negative discretion, EBITDA gate not met) |
| Target Long-Term Incentive (LTI) | 500% of base ($5,510,000): 50% RSUs / 50% PSUs | No change in target 2024; granted pursuant to plan |
| Perquisite Allowance | $25,000 (CEO) | Personal aircraft use permitted in limited cases; otherwise primarily business use |
| Retirement/Deferred Plans | 401(k) with match; deferred comp available (no NEO deferrals in 2024) | NEOs participate in 401(k); no defined benefit pension; no deferred comp participation in 2024 |
Performance Compensation
2024 Short-Term Incentive Plan (STIP) – Design and Results
| Metric | Threshold | Target | Maximum | 2024 Actual | Payout |
|---|---|---|---|---|---|
| Net Sales Growth ($M) | $3,433 | $3,536 | $3,657 | $3,377 | 0% (gated) |
| Adjusted EBITDA ($M) | $333 | $380 | $405 | $337 | 0% (below threshold; gating applied) |
| Gross Margin ($M) | $588 | $670 | $710 | $593 | 0% (gated) |
| Engagement Score (points) | +1 | +2 | +3 | +3 | 0% (negative discretion due to EBITDA gate) |
Notes:
- Committee reduced STIP weighting for Adjusted EBITDA from 55% to 30% for 2024 to emphasize GAAP metrics .
- Overall STIP payout was 0% for 2024 (pay for performance) .
Long-Term Incentive Plan (RSUs and PSUs)
| Element | Structure | Weighting | Measurement | Rationale |
|---|---|---|---|---|
| RSUs | Time-based, vest 1/3 annually over 3 years | 50% | 3-year time vest | Retention and ownership alignment |
| PSUs (2024 design) | ROIC | 37.5% | 3-year cumulative FY2024–2026 | Capital efficiency focus |
| PSUs (2024 design) | Total Organic Revenue Growth % | 37.5% | 3-year cumulative FY2024–2026 | Top-line growth focus |
| PSUs (2024 design) | Relative TSR (Russell 3000 Packaged Foods & Meats) | 25% | 3-year cumulative FY2024–2026 | Aligns to shareholder value |
Prior-year PSU performance and vesting:
- 2022 PSUs (FY2022–2024) earned 57.8% overall; for Oakland, 66,071 PSUs earned at 57.9% weighted payout .
- 2023 PSUs (FY2023–2025), 2024 tranche results: ONI target $133.9M vs actual $100.5M (75.1% of target; payout 0%), Cash Flow Pre-Financing target $153.3M vs actual $126.1M (82.3% of target; payout 55.6%; weighted payout banked 7.0%) .
Equity Ownership & Alignment
| Category | Detail |
|---|---|
| Beneficial Ownership | 358,848 shares (excl. options); 51,923 options currently exercisable; total 410,771 shares |
| Ownership as % of Outstanding | <1% indicated for NEOs; 50,203,511 shares outstanding as of Feb 25, 2025 |
| Unvested RSUs (12/31/2024) | 86,669 ($3,044,682), 56,286 ($1,977,327), 75,602 ($2,655,898) |
| Unearned PSUs (12/31/2024) | 93,730 ($3,292,735), 6,828 ($239,868); r-TSR FY2022–2024 tranche shows 19,634 units valued $689,742 |
| Options | 51,923 exercisable; 103,845 unexercisable; strike $42.69; expire 5/13/2032; vesting 1/3 on 2nd anniversary, 2/3 on 3rd anniversary (underwater vs $35.13 YE price) |
| Ownership Guidelines | CEO must hold 6x base salary; all NEOs met or are on track; must hold 50% of net shares until compliant |
| Hedging/Pledging | Prohibited; no margin or pledging permitted |
| Insider Selling | Company discloses Mr. Oakland has not sold Company shares since joining in 2018 |
Employment Terms
| Term | Key Provisions |
|---|---|
| Agreement | Employment agreement effective March 2, 2018; auto-renews annually unless 90 days prior notice |
| Compensation Floors | Base salary ≥ $1,000,000; STIP target ≥ 130% of base; annual LTI awards ≈ ≥ $5,000,000 |
| Restrictive Covenants | 12-month post-termination non-compete and non-solicit; confidentiality obligations ongoing |
| Severance (No CIC) | 2x base salary + target bonus; health/welfare continuation up to 2 years; release required |
| Severance (Change in Control) | 3x base salary + target bonus; health/welfare continuation up to 3 years; double-trigger; “best net” applies; no excise tax gross-up |
| Equity Treatment | No acceleration for options/RSUs on non-CIC involuntary termination; accrued/pro-rata PSUs vest; CIC rules allow assumption/replacement or vesting/cash-out per plan |
Illustrative potential payouts (assuming 12/31/2024 event; stock $35.13):
| Scenario | Total ($) |
|---|---|
| Involuntary Termination (no CIC) | $8,279,337 (severance, pro-rata equity, welfare) |
| CIC + Qualifying Termination | $20,810,737 (severance, equity acceleration/treatment, welfare) |
Board Governance
- Role: Chairman of the Board, CEO & President; Director since March 2018; no committee memberships as an executive director .
- Combined Chair/CEO: Board appointed Oakland as Chairman in April 2023; robust Lead Independent Director role (Linda Massman) and fully independent Board committees provide counterbalance; independent-only executive sessions occur at least quarterly .
- Committees: Audit, Compensation, and Nominating & Corporate Governance are fully independent; Oakland may attend only by invitation and not during executive sessions .
- Meetings/Attendance: Board met seven times in 2024; all current directors attended ≥75% of Board and committee meetings .
- Director Compensation: Employee directors receive no additional fees for Board service .
Director Compensation (for context on dual role)
| Item | Amount/Policy |
|---|---|
| Employee Directors | No additional fees for service (applies to Oakland) |
| Lead Independent Director | $35,000 cash retainer; committee retainers as disclosed |
Say-on-Pay & Shareholder Feedback
- 2024 Say-on-Pay approval: approximately 96% support, a significant improvement vs. 2023; program changes included adding ROIC and total organic revenue to PSUs and shifting to cumulative 3-year targets .
- Engagement: Company engaged with holders representing ~85% of common shares outstanding; independent directors and executives participated .
Compensation Structure Analysis
- Cash vs. equity mix remains highly at-risk for CEO (≥85% variable); no change in CEO 2024 target pay; RSUs continue to vest over 3 years .
- STIP paid 0% in 2024 due to below-threshold Adjusted EBITDA and negative discretion, reinforcing pay-for-performance discipline .
- 2022 PBRSUs did not vest; 2022 PSUs paid at 57.8% and 2023 PSU 2024 tranche below target on ONI; options granted in 2022 remain underwater (strike $42.69 vs $35.13 YE), limiting near-term exercise/sale pressure .
- No single-trigger CIC; no excise tax gross-ups; robust clawback policy updated in 2023 to comply with NYSE Rule 10D-1 .
Risk Indicators & Red Flags
- Anti-hedging and anti-pledging policy in place; no pledging permitted .
- No excise tax gross-up and double-trigger CIC mitigate shareholder-unfriendly optics .
- Related party transactions: none reportable since Jan 1, 2024; Board oversees conflicts per Code of Ethics .
Compensation Peer Group (benchmarking context)
- Peer group includes branded and packaged food companies such as Conagra, McCormick, Post Holdings, The J.M. Smucker Company, Lamb Weston, Flowers Foods, Ingredion, Perrigo, Fresh Del Monte, Hain Celestial, ACCO Brands, Primo Water, Energizer, Edgewell, Lancaster Colony; THS positioned ~42nd percentile in revenue and ~27th percentile in TEV within the group at the review time .
Performance & Track Record
- Strategic actions: portfolio simplification via 2022 divestiture of Meal Preparation, ongoing acquisitions/integration to build depth in tea (Harris Tea, Jan 2025), coffee (Northlake, TX integration), and pickles (Bick’s, Jan 2024); supply chain savings trajectory toward $250 million through 2027 .
- 2024 financials: net sales $3,354.0M; adjusted EBITDA $337.4M; cash from operations $265.8M; free cash flow $126.1M; buybacks ~$149.7M .
Employment & Contracts (Retention analysis)
| Feature | Details |
|---|---|
| Term and Renewal | Annual auto-renewal; strong retention via LTI floors and restrictive covenants |
| Severance | 2x base+target bonus (no CIC); 3x base+target bonus (CIC), double trigger; health benefits continue 2–3 years |
| Clawbacks | Mandatory recovery for restatements and discretionary recovery for misconduct |
Investment Implications
- Alignment strong: CEO has not sold shares since 2018; anti-hedging/pledging policies; substantial unvested RSUs/PSUs and underwater options reduce near-term selling pressure and align with long-term value creation .
- Pay-for-performance discipline: 0% STIP payout in 2024 and sub-target PSU outcomes reflect rigorous targets and negative discretion, supporting governance quality; 2024 program changes (ROIC and organic revenue) sharpen focus on capital efficiency and growth .
- Retention risk mitigated: auto-renewing contract, meaningful equity holdings, and double-trigger CIC benefits provide stability; no excise tax gross-ups and independent committee oversight address shareholder concerns .
- Dual-role governance: Combined Chair/CEO counterbalanced by a strong Lead Independent Director and fully independent committees with regular executive sessions; board meeting attendance and declassification by 2026 support governance modernization .