F. William McNabb III

About F. William McNabb III

Former Chairman (2010–2018) and CEO (2008–2017) of The Vanguard Group; joined Vanguard in 1986 and previously led all client-facing divisions. UnitedHealth Group director since 2018; age 67. Current UNH roles: Chair of the Audit & Finance Committee and member of the Governance Committee; designated an “audit committee financial expert.” Current outside public directorship: IBM. Independent under NYSE and UNH standards .

Past Roles

Organization	Role	Tenure	Committees/Impact
The Vanguard Group, Inc.	Chief Executive Officer	2008–2017	Led major client-facing divisions prior to CEO role
The Vanguard Group, Inc.	Chairman	2010–2018	Chaired Board of Directors and Board of Trustees of Vanguard funds
Investment Company Institute (ICI)	Chair, Board of Governors	2013–2016	Industry leadership for asset management trade group

External Roles

Organization	Role	Tenure	Notes
International Business Machines Corp. (IBM)	Director	Current	Only current outside public directorship disclosed
Wharton Leadership Advisory Board	Member	Current	Governance/leadership advisory role
Columbia Law School Millstein Center Advisory Board	Member	Current	Corporate governance advisory role
CECP: The CEO Force for Good	Board Member	Current	Corporate purpose/ESG-focused nonprofit

Board Governance

Committee	Role	Meetings in 2024	Key Oversight and Notes
Audit and Finance	Chair	10	Oversees auditor selection, financial reporting, internal controls, ethics/compliance, privacy/cybersecurity; explicit oversight of AI governance framework and sustainability disclosure assurance; risk identification and financing policies. All members independent; McNabb designated an “audit committee financial expert.”
Governance	Member	5	Director nominations, board/committee evaluations, independence standards, sustainability policies, political contributions and lobbying oversight; all members independent

Independence and leadership: Board separates Chair and CEO; 80% independent directors; robust Lead Independent Director structure and board evaluation process; directors attended 97% of combined Board/committee meetings in 2024 and all attended the 2024 annual meeting .

Fixed Compensation (Non-Employee Director Pay – 2024)

Component	Amount
Fees Earned or Paid in Cash	$— (elected to convert cash to DSUs)
Stock Awards (DSUs; ASC 718 grant-date value)	$383,461
All Other Compensation	$10,141 (health care premiums paid on his behalf)
Total	$393,602

Program structure highlights:

Annual cash retainer: $125,000; Audit & Finance Chair retainer: $32,500; annual stock compensation: $225,000 in DSUs (granted quarterly); directors may elect to convert cash retainers into DSUs or into common stock if ownership guidelines are met .
In 2024, McNabb converted $158,758 of cash compensation into 308 DSUs .

Performance Compensation

Directors do not receive performance-based bonuses or options at UNH. Equity is delivered as DSUs that vest upon grant but must be retained until board service ends or until ownership guidelines are met; dividend equivalents paid in DSUs .

Other Directorships & Interlocks

Company/Entity	Type	Potential Interlock/Exposure
IBM	Current public company board	None disclosed as a related-person transaction with UNH
Vanguard (former employer)	5% shareholder context	UNH and employees paid Vanguard ~$7.8M for benefits program management fees in 2024; disclosed under “Transactions with 5% Shareholders.” McNabb retired from Vanguard in 2018; policy excludes transactions where a related person’s only relationship is as a director or trustee from “related-person transactions.” Appearance risk mitigated by disclosure and Governance Committee policy .
Major 5% owners	Ownership context	Vanguard ~9.21% and BlackRock ~7.98% of UNH per 5% owners table; both relationships disclosed (see also related-person transactions section) .

Expertise & Qualifications

Capital markets and asset management operator: former CEO/Chair of Vanguard; deep governance experience (ICI chair) .
Audit and risk oversight: designated audit committee financial expert; chairs UNH Audit & Finance; oversight includes cybersecurity and AI governance, and sustainability assurance .
Governance oversight: participates in board evaluations/nominations/political activity oversight via Governance Committee .

Equity Ownership

Metric	Amount/Detail
Beneficial ownership (as of April 4, 2025)	13,656 total shares (includes vested DSUs counted per guidelines); <1% of outstanding
Vested DSUs considered “owned” under guidelines (as of April 4, 2025)	7,226
DSUs outstanding (as of December 31, 2024)	7,013
Shares outstanding reference (record date)	910,223,791
Director stock ownership guideline	5x annual cash retainer; compliance required within 5 years; company discloses all non-employee directors have met requirements or are within the 5-year window
Hedging/pledging policy	Prohibits short sales, hedging, and pledging by directors and executive officers

Governance Assessment

Strengths and signals supporting investor confidence:
- Independent, finance-savvy oversight: McNabb is independent and an SEC-defined “audit committee financial expert,” chairing a broad-scope Audit & Finance Committee (financial reporting, cyber/AI, sustainability assurance). This structure aligns with best practice risk governance at a complex payer/provider platform .
- High engagement culture: Board/committee attendance was strong (97% combined in 2024) and all directors attended the annual meeting, indicating engagement; board conducts annual evaluations with independent facilitation .
- Pay alignment and ownership: Director pay is largely equity-based; DSUs must be retained; directors subject to 5x retainer ownership guideline and prohibitions on hedging/pledging—enhancing alignment with long-term shareholder value .
- Time-commitment controls: Policy caps independent directors at three other public boards; all directors compliant—mitigates overboarding risk alongside McNabb’s single disclosed outside public board (IBM) .
Watch items / RED FLAGS (appearance, not determinative):
- Related dealings with 5% owners: UNH disclosed ~$7.8M paid to Vanguard (benefits program fees) and other amounts involving BlackRock; while standard for large plan administration and not flagged as related-person to McNabb (retired from Vanguard in 2018), investors may perceive an appearance risk. Governance Committee policy, independence determinations, and explicit disclosure are mitigating factors .
- No director-specific attendance disclosure: Company provides aggregate attendance (97%) and policy threshold (≥75%); no individual attendance rates published—typical practice, but limits director-level engagement transparency .

Director Compensation Detail (Program Reference)

Compensation Element	Compensation Value ($)
Annual Cash Retainer	125,000
Annual Audit & Finance Committee Chair Retainer	32,500
Annual Stock Compensation Award	225,000 (aggregate fair value in DSUs; granted quarterly)
Stock Compensation Conversion Program	Cash retainer may be converted to DSUs or common stock (if ownership guideline met) at director’s election

Additional Board Process and Policies

Conflicts and related-party approvals: Written policy administered by Governance Committee; prohibits related-person transactions unless approved; factors include fairness, independence, conflicts; certain categories (e.g., where person’s only relationship is as director/trustee) excluded from “related-person” definition .
Lead Independent Director and independent leadership: Separate Chair/CEO; ex-officio LID participation on committees; independent committee chairs; annual leadership structure review .

Overall view: McNabb brings deep capital markets governance, strong audit/risk oversight (including AI and cyber), and equity-aligned director pay. The main appearance risk is the disclosed services relationship with Vanguard (a 5% holder and his former employer), mitigated by independence determinations, policy controls, and transparent disclosure .

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