Ernie Herrman
TJX COMPANIES INC /DE/About Ernie Herrman
Ernie Herrman is Chief Executive Officer (since 2016) and President (since 2011) of TJX, and has served as a director since 2015; he is 64 years old and has been with TJX since 1989 across merchandising and senior operating roles . Under his leadership, FY25 net sales reached $56.4B (up 4% YoY), diluted EPS was $4.26, and total shareholder return was 29.7%; TJX returned $4.1B to shareholders and ended FY25 with $5.3B in cash . Incentive results tied to financial performance were strong: FY25 annual MIP paid 152% of target, and FY23–25 PSUs paid 155.9% on EPS growth with ROIC above target; FY23–25 LRPIP paid 104.7% .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| TJX | Chief Executive Officer | 2016–present | Managed a complex global retail business; oversaw near- and long-term strategy including global expansion; broad expertise across merchandising, finance, operations, and distribution |
| TJX | President | 2011–present | Led enterprise-wide execution and growth initiatives; talent development and organizational management |
| TJX (Marmaxx, HomeGoods, TJX Canada) | SEVP, Group President | 2008–2011 | Multi-banner leadership across U.S., Canada, and HomeGoods driving off-price merchandising and scale |
| TJX (Marmaxx) | President | 2005–2008 | Banner leadership for TJ Maxx/Marshalls, merchandising and operating performance |
| TJX (Marmaxx) | SEVP, Chief Operating Officer | 2004–2005 | COO responsibilities across store operations, supply chain, and execution |
| TJX | Merchandising roles | 1989–2004 | Deep off-price merchant background foundational to TJX buying model |
External Roles
No other current public company directorships or committee roles were disclosed for Mr. Herrman in the proxy biography .
Fixed Compensation
Multi-year executive compensation (CEO):
| Metric | FY 2023 | FY 2024 | FY 2025 |
|---|---|---|---|
| Base Salary ($) | $1,700,002 | $1,732,695 | $1,700,002 |
| Stock Awards (Grant-date Fair Value, $) | $10,900,034 | $10,900,088 | $12,600,163 |
| Non-Equity Incentive (MIP + LRPIP, $) | $7,508,796 | $7,950,096 | $6,947,907 |
| Change in Pension Value ($) | — | $993,435 | $1,593,081 |
| All Other Compensation ($) | $416,536 | $646,455 | $641,375 |
| Total ($) | $20,525,368 | $22,222,769 | $23,482,528 |
Key fixed pay and policy highlights:
- FY25 year-end base salary $1,700,000; no FY25 salary increase for the CEO .
- Perquisites (no tax gross-ups) include auto allowance, executive health, financial/tax planning, data privacy, home security, and life insurance premiums; also deferred compensation credits under ESP; CEO participates in alternative SERP program restoring qualified plan limits .
Performance Compensation
Annual MIP (FY25):
| Metric | Weighting | Target | Actual | Payout | Vesting/Payment |
|---|---|---|---|---|---|
| MIP Incentive Pre-Tax Income (Company) | 100% | $6,580,143 (thousands basis) | $7,007,747 (thousands basis) | 152.0% of target | Paid calendar 2025 (CEO MIP earned $5,168,007) |
CEO MIP structure:
- FY25 target MIP opportunity: 200% of base salary; payout applied uniformly to NEOs .
Long-Term Incentives (completed FY23–25 cycle):
| Plan | Primary Metric | Target | Actual | Payout | Vesting/Settlement |
|---|---|---|---|---|---|
| PSUs (FY23–25) | Incentive EPS growth (3-yr CAGR) with ROIC modifier | $3.90 EPS = 8.8% CAGR from $3.03 | $4.27 EPS = 12.1% CAGR | 155.9% (no ROIC reduction; 3-yr avg ROIC 31.7%) | Vested upon Committee certification 3/31/2025; CEO earned 164,450 PSUs |
| LRPIP (FY23–25) | Incentive Pre-Tax Income (cumulative) | $18,496,236 (thousands) | $19,081,205 (thousands) | 104.7% of target | Paid calendar 2025; CEO LRPIP earned $1,779,900 |
In-flight LTI grants (FY25–27 cycle; granted 4/2/2024):
| Award | Grant Date | Target Units/Value | Metric/Terms | Vesting |
|---|---|---|---|---|
| PSUs | 4/2/2024 | 82,840 target units; grant-date fair value $8,240,095 | Incentive EPS growth (primary) with downward-only ROIC modifier; payout 0–200% | Service through FY27; performance certified after cycle |
| RSUs | 4/2/2024 | 43,833 units; grant-date fair value $4,360,069 | Service-based | Scheduled vest FY28 (April 2027) |
CEO LTI mix emphasizes performance:
- Approx. 70% of CEO’s FY25–27 LTI opportunities are performance-based (PSUs + LRPIP) .
Equity Ownership & Alignment
| Item | Detail |
|---|---|
| Total beneficial ownership | 417,140 shares; less than 1% of outstanding |
| Right to acquire within 60 days | 138,562 shares deliverable under vested awards |
| Unvested/earned awards (as of 2/1/2025) | PSUs FY23–25 earned: 164,450 (vest 3/31/2025); RSUs: 68,283 (vest 4/10/2025), 56,382 (vest 4/10/2026), 43,833 (vest 4/10/2027); Career Shares unvested: 20,052 (vest last day of FY26) |
| Ownership guidelines | CEO must hold ≥6x base salary; all executives in compliance as of 4/15/2025 |
| Hedging/pledging | Prohibited for directors and executive officers |
Vesting schedule detail (as of FY25 year-end):
| Award Category | Units | Vesting Date |
|---|---|---|
| FY23–25 PSUs (earned) | 164,450 | 3/31/2025 |
| RSU | 68,283 | 4/10/2025 |
| RSU | 56,382 | 4/10/2026 |
| RSU | 43,833 | 4/10/2027 |
| Career Shares (CEO award from FY16) | 20,052 | Last day of FY26 |
Stock ownership policies and clawbacks:
- Dodd-Frank clawback policy in place; additional forfeiture mechanisms for detrimental conduct and covenant breaches .
- No hedging/pledging; insiders subject to pre-clearance and insider trading policy .
Employment Terms
| Provision | Key Terms |
|---|---|
| Employment agreement term | Extended in Jan 2025; continues until January 29, 2028 (unless earlier terminated) |
| Severance plan participation | 2018 Executive Severance Plan (closed to new participants) with covenants; change-in-control benefits via employment agreement |
| Non-compete / non-solicit | Applies during employment and 24 months thereafter; conditioned on benefits compliance |
| Termination without cause / constructive termination | 24 months base salary and auto allowance continuation; COBRA cost reimbursement net of taxes; prorated MIP/LRPIP subject to performance; equity in accordance with award terms |
| Change of control (COC) | Double-trigger: lump sum = 2x (base salary + auto allowance + target MIP); 2 years benefits continuation; equity accelerates per SIP/LRPIP terms; no excise tax gross-ups; payments reduced if beneficial after-tax |
| CEO-specific amounts (illustrative scenario) | COC followed by qualifying termination total $59,219,174 (includes equity and severance components) |
| Retirement/SSR eligibility | CEO qualifies for “special service retirement”; continued PSU vesting subject to performance; RSUs prorated service vesting; career shares continue per plan |
| ESP/SERP participation | CEO eligible for specified ESP company match; participates in alternative SERP restoring pension limits |
Change-in-control and equity treatment specifics:
- Unvested PSUs deemed at target upon COC; full vest if awards not continued/assumed or upon qualifying termination within 24 months post-COC; RSUs similarly vest; career shares unvested portion generally not eligible for acceleration except as described for COC .
Board Governance
- Board service: Director since 2015; not independent due to executive role .
- Committee roles: Not listed as a member of Audit and Finance, Compensation, Corporate Governance, or Executive Committees (those are composed of non-employee independent directors; Executive Committee includes the Executive Chairman) .
- Attendance: Each director attended at least 75% of Board and committee meetings; full Board met five times in FY25 .
- Leadership structure: CEO and Chairman roles separated; Executive Chairman is not independent; Lead Independent Director provides independent leadership and executive session management .
- Governance practices: Majority independent Board, stock ownership guidelines for directors and executives, clawback/recoupment provisions, and prohibition on hedging/pledging .
Director Compensation (context for dual roles)
- Employee directors (CEO) receive no separate director compensation; non-employee director retainer $110,000 plus committee/lead premiums and $200,000 deferred stock awards annually .
Say-on-Pay & Shareholder Feedback
- Advisory vote support: 94% in 2023 and 91% in 2024, reflecting strong shareholder endorsement of program design and pay-for-performance alignment .
- Ongoing shareholder engagement informs compensation practices and disclosures .
Compensation Peer Group (Benchmarking)
- FY25 peer group (17 consumer-oriented companies): Best Buy, Coca-Cola, Estée Lauder, The Home Depot, Kimberly-Clark, Kohl’s, Lowe’s, Macy’s, McDonald’s, Mondelez, Nike, PepsiCo, Procter & Gamble, Ross Stores, Starbucks, Target, Walmart; changes included removing Nordstrom and VF Corp and adding Mondelez and Walmart .
- TJX positioning at FY25: ~71st percentile revenue, 53rd percentile market cap, 82nd percentile employees vs peer group .
- Committee does not strictly benchmark to specific percentiles; uses peer context and case studies with Pearl Meyer as independent advisor .
Risk Indicators & Red Flags (observations)
- No excise tax gross-ups on change of control; awards do not automatically fully accelerate on COC without a qualifying termination—reducing parachute optics .
- Robust clawback policies and prohibitions on hedging/pledging enhance alignment and mitigate risk .
- Equity grant practices avoid timing around material nonpublic information; no FY25 stock options granted .
Investment Implications
- Strong pay-for-performance linkage: All key incentives are 100% tied to objective financial metrics (MIP: Pre-Tax Income; PSUs: EPS with ROIC modifier; LRPIP: Pre-Tax Income), with above-target payouts reflecting operational execution and returns—supports confidence in management discipline .
- Alignment and retention: CEO is in compliance with stringent 6x salary ownership guidelines; vesting schedules and SSR provisions promote retention while maintaining performance gating on PSUs; hedging/pledging prohibitions and clawbacks enhance investor protection .
- Watchlist for trading signals: Upcoming vesting dates (PSUs 3/31/2025, RSUs 4/10/2025, 4/10/2026, 4/10/2027; career shares FY26) may cluster Form 4 activity (net share settlements) and near-term supply; monitor filings around these dates for selling pressure indicators .
- Change-of-control economics: Double-trigger severance of 2x cash plus significant equity settlement (illustrative total $59.2M) is market-comparable and lacks tax gross-ups; governance mitigants (separate Chair/CEO, Lead Director) reduce dual-role concerns .
- Shareholder posture: High say-on-pay support (91–94%) and peer-aware design suggest limited compensation overhang risk; ongoing engagement provides responsiveness to investor concerns .