Melissa Smith
WEXAbout Melissa Smith
Melissa Smith is Chair, Chief Executive Officer, and President of WEX Inc.; age 56, director since 2014, Chair since September 2019, President since May 2013, and CEO since January 2014, with prior roles including CFO and EVP Finance & Operations (2007–2011), SVP Finance & CFO (2001–2007), and earlier positions at WEX starting in 1997; she began her career at Ernst & Young . WEX delivered record 2024 revenue of $2.6 billion, up 3% year-over-year, with adjusted net income per diluted share up 3% to $15.28; five-year CAGRs were 8.8% for revenue, 27.1% for GAAP diluted EPS, and 10.7% for adjusted EPS, underpinning a pay-for-performance approach and strong execution . Say-on-pay support was ~98% in 2024, and 92% of her 2024 target total direct compensation was variable, with 100% of her long-term incentive mix performance-contingent via PRSUs and MSUs .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| WEX Inc. | Chair of the Board | 2019–present | Leads Board, sets agendas, oversees information flow and governance, supported by Lead Independent Director structure . |
| WEX Inc. | Chief Executive Officer | 2014–present | Drove multi-year growth, $100M run-rate cost savings, AI initiatives, capital returns (~3.3M shares repurchased, ~$650M) . |
| WEX Inc. | President | 2013–present | Oversees company-wide execution and operational priorities . |
| WEX Inc. | President, The Americas | 2011–2013 | Led regional operations; advanced strategic growth initiatives . |
| WEX Inc. | CFO & EVP Finance and Operations | 2007–2011 | Led finance and operations; strengthened controls and reporting . |
| WEX Inc. | SVP Finance & CFO | 2001–2007 | Finance leadership through growth and scaling; capital allocation . |
| WEX Inc. | Various roles | 1997–2001 | Progressive leadership across finance and operations . |
| Ernst & Young | Auditor | Early career | Foundational accounting and reporting expertise . |
External Roles
| Organization | Role | Years | Committees / Strategic Impact |
|---|---|---|---|
| Equifax Inc. | Director | 2020–present | Serves on Compensation and Governance Committees; contributes data/technology governance expertise . |
Fixed Compensation
| Metric | 2022 | 2023 | 2024 |
|---|---|---|---|
| Base Salary ($) | $854,808 | $875,000 | $955,769 (earned) ; annualized $975,000; +11% increase to position pay near market median . |
| Target Bonus (%) | 150% (CEO plan design) | 150% | 150% |
| Actual STIP Paid ($) | $2,037,434 | $1,775,813 | $966,713 (funding 66.1% × 100% IPF) |
| Stock Awards ($, grant-date fair value) | $5,362,593 | $6,619,058 | $10,529,340 |
| Option Awards ($) | $1,787,568 | $2,206,265 | $0 (no options granted in 2024) |
| All Other Compensation ($) | $143,337 | $150,519 | $108,527 (401k match, EDCP match, wellness and executive physical, select travel) |
| Total Compensation ($) | $10,185,740 | $11,662,841 | $12,594,328 |
Performance Compensation
| Program | Metric | Weighting | Threshold | Target | Max | 2024 Actual | Payout |
|---|---|---|---|---|---|---|---|
| STIP (Annual) | Adjusted Revenue ($mm) | 40% | $2,592.6 | $2,729.1 | $2,865.6 | $2,614.3 | 23.2% of target (component) |
| STIP (Annual) | Adjusted Operating Income ($mm) | 60% | $1,030.1 | $1,107.6 | $1,163.0 | $1,063.6 | 43.0% of target (component) |
| STIP (Annual) | Corporate factor (weighted) | — | — | — | — | — | 66.1% (CEO IPF = 100%) → $966,713 paid |
| PRSU (2022 grant; 3-yr perf) | Adjusted Net Revenue (cumulative) | 40% | $6,318 | $6,756 | — | $7,183 | 200% (component) |
| PRSU (2022 grant; 3-yr perf) | ANI EPS (cumulative) | 60% | $35.00 | $39.05 | — | $43.75 | 139.6% (component) → 163.8% overall |
| MSU (2024 grant; 1st tranche) | Absolute Stock Price Change | — | Payout factor min 60% (−40% price) | 100% | Max 200% (+100% price) | One-year measurement | 67.2% of target units (≈44.7% of grant value) |
Vesting schedules and 2024 CEO awards:
- 2024 PRSUs: 27,049 target units granted 3/15/2024; cliff vest on 3/15/2027 subject to performance; payout range 0–200% .
- 2024 MSUs: 14,565 target units granted 3/15/2024; vest in three equal tranches annually starting 3/15/2025, payout factor tied to absolute stock price change (10-day averages) with 60%–200% range .
- CEO 2024 LTIP mix: 65% PRSUs, 35% MSUs; 100% performance-contingent (no RSUs/options) .
2025 CEO PRSU program changes (alignment levers):
- Weighting: 50% relative TSR vs a 33-company group, 30% ANI EPS, 20% Adjusted Revenue; TSR capped at target if absolute TSR is negative; >median TSR needed to exceed target; max at ≥80th percentile .
- 1-year post-vest holding requirement added for PRSUs and MSUs (deferred payout) .
Equity Ownership & Alignment
| Item | Detail |
|---|---|
| Beneficial Ownership | 154,535 common shares owned directly/indirectly; Rights to acquire 168,163 (options/RSUs/PRSUs/MSUs through 5/31/2025); total 322,698 shares; <1% of outstanding . |
| Indirect holdings | Includes three children’s trusts (1,692/1,693/1,693 shares), spouse holdings (18,277 shares), and a grantor retained annuity trust (33,719 shares) . |
| Unvested/earned awards (12/31/2024) | Unvested RSUs/earned PRSUs awaiting time vest: 50,336 units; unearned PRSUs/MSUs (assumed at target): 102,632 units . |
| Options outstanding | Multiple legacy grants, e.g., 42,696 options @ $109.66 expiring 3/16/2030; 16,834 @ $226.02 expiring 3/15/2031; 16,810 unexercisable @ $163.22 expiring 3/15/2032; 8,997 exercisable/18,024 unexercisable @ $173.56 expiring 3/15/2033 . |
| 2024 exercises/vesting | 54,107 shares acquired on option exercise (value $5,870,462); 39,298 shares vested (value $9,193,767) . |
| Ownership guidelines | CEO 6.0x base salary; all NEOs compliant as of July 2024; 50% net-after-tax retention until compliant; MSUs/unearthed PRSUs excluded from guideline equity . |
| Hedging/pledging | Prohibited for directors/executive officers/designated employees under insider trading policy . |
Employment Terms
| Provision | CEO Terms |
|---|---|
| Basic severance (no CIC) | 1.5x base salary + 1x target bonus, lump sum or over 12 months at Company election; accelerates equity scheduled to vest within 1 year; lump sum health premium equivalent . |
| Change-in-control (double trigger) | 2x base salary + 2x target bonus over 24 months; 100% acceleration of equity (if not assumed or upon qualifying termination); lump sum of 24× monthly employer health premium share . |
| Restrictive covenants | Non-compete: 2 years for without cause/constructive discharge with CIC; 1 year otherwise; non-solicitation and non-disparagement provisions; confidentiality indefinite . |
| Clawbacks | NYSE-mandated restatement clawback (3-year lookback) plus supplemental misconduct clawback covering time- and performance-based equity and incentive comp (VP+ population) . |
| Tax gross-ups | Company does not provide excise tax gross-ups upon CIC . |
| Deferred compensation | 2017 EDCP: CEO contributed $241,678; Company match $58,003; aggregate EDCP balance $3,332,768; SERP balance $230,667; 2005 EDCP balance $1,129,865 . |
| Perquisites | Executive physical and financial counseling reimbursements (up to $10,000 and $12,000 per year, respectively); included in “All Other Compensation” . |
Board Governance
- Dual role: Melissa Smith serves as Chair and CEO; mitigants include an independent Vice Chairman and Lead Director (Jack VanWoerkom) who leads executive sessions and independent director communications, and robust committee independence across Audit, LDCC, Corporate Governance, Finance, and Technology & Cybersecurity .
- Independence: Smith is not independent (President & CEO), while all standing committees are fully independent under NYSE and SEC rules .
- Board activity: 5 Board meetings in 2024 with each director attending ≥75% of applicable meetings; independent directors meet in executive session at least semi-annually .
- Director compensation: Employee directors (including Melissa Smith) are not separately compensated for Board service .
Compensation Committee Analysis and Peer Benchmarking
- LDCC composition: Stephen Smith (Chair), Nancy Altobello, Daniel Callahan, James Neary, Jack VanWoerkom; six meetings in 2024; independent consultant Compensation Advisory Partners (CAP) advising peer selection, design, and pay-performance alignment; no committee interlocks disclosed in 2024 .
- Target positioning: Total direct compensation targeted within a competitive range of market median; CEO and CFO received 2024 base salary increases (11.4% and 5%) to maintain market positioning .
- 2024 benchmarking peer group (examples): Broadridge, Jack Henry, Fair Isaac, Paychex, Paycom, Paylocity, TransUnion, Euronet, HealthEquity, Block, BILL, ACI, CSG, EVERTEC, Dayforce, Corpay; WEX market cap $6.8B vs peer median $11.5B .
Say-on-Pay & Shareholder Feedback
- 2024 say-on-pay support ~98%; WEX engaged holders representing ~64% of shares outstanding during fall 2024, with feedback incorporated (e.g., adding relative TSR and post-vest holding for CEO 2025 grants) .
Performance & Track Record
- Financials and execution: 2024 revenue +3% to $2.6B; adjusted diluted EPS +3% to $15.28; exceeded $100M cost-savings run-rate, reinvesting for growth (AI, EV At-Home reimbursement, 10-4 OTR discount platform, currency-flexible corporate payments, Benefits tech improvements); repurchased ~3.3M shares at ~$650M in 2024 .
- Pay-versus-performance: CAP aligned directionally with TSR due to equity-heavy design; CAP less directly correlated with GAAP net income, consistent with use of ANI EPS and operating income in plans .
Risk Indicators & Red Flags
- Hedging/pledging prohibited for insiders (alignment positive) .
- No excise tax gross-ups; option/SAR repricing prohibited without shareholder approval (shareholder-friendly) .
- Robust dual clawbacks covering restatements and misconduct (recovery mechanisms) .
- Combined Chair/CEO role mitigated by strong Lead Director and independent committees (governance trade-off) .
- Insider selling pressure: 2024 option exercises (54,107 shares, $5.87M realized) and significant vesting ($9.19M value) represent potential liquidity events; note 2025 one-year post-vest holding added for CEO awards may moderate near-term sales .
Compensation Structure Analysis
- Mix shifts: 2024 eliminated options, introduced MSUs, and made CEO LTIP 100% performance-contingent (PRSU+MSU), increasing direct linkage to stock price and financial outcomes .
- Metrics rigor: STIP weighted 60% AOI and 40% Adjusted Revenue with funding at 66.1%; PRSUs focused on ANI EPS (60%) and Adjusted Net Revenue (40%), with 2022–2024 payout at 163.8%; 2025 adds relative TSR (50%) and post-vest holding—tightening alignment to shareholder returns .
- Ownership discipline: CEO 6x salary guideline; all NEOs compliant; anti-hedging/pledging; mandatory share retention until guideline met .
Investment Implications
- Alignment: High variable pay (92% for CEO) with performance-centric LTIP and addition of relative TSR plus post-vest holding in 2025 strengthen shareholder alignment; strong say-on-pay support reduces governance overhang .
- Retention: Competitive severance (1.5x base + 1x bonus; 2x/2x at CIC with full equity vest) and multi-year PRSU/MSU structures enhance retention, while non-compete up to 2 years (with CIC) and clawbacks protect value; risk of dilution managed via share reserve proposals and fungible ratios .
- Trading signals: 2024 exercises/vesting signal potential liquidity needs; upcoming MSU tranches on each anniversary and PRSU cliff in 2027 are relevant for monitoring Form 4 activity; 2025 holding requirement may dampen immediate selling post-vest .
- Governance: Combined Chair/CEO structure offset by Lead Director and executive sessions; independent committees and strong oversight (technology/cyber, finance, audit) mitigate concentration risks .