Eric Green
About Eric Green
Eric M. Green, 55, is West Pharmaceutical Services’ President, Chief Executive Officer, and Chair of the Board; he has served as CEO and director since 2015 and became Chair on May 24, 2022 . He holds an MBA from Olin Business School at Washington University in St. Louis and a BS in Chemistry from Bethel University . In 2024 West reported net sales of $2.893 billion (down 1.9%) and reported diluted EPS of $6.69 (down 15.1%); over the last five years the company states it outperformed both the S&P 500 and S&P 500 Health Care indices in TSR . Under Green’s leadership, West expanded capacity in high-value product (HVP) components, supported GLP-1 market growth, returned over $560 million via repurchases in 2024, and raised the dividend for the 32nd consecutive year .
Past Roles
| Organization | Role | Years | Strategic impact |
|---|---|---|---|
| Sigma-Aldrich Corporation | Senior executive roles including VP, Global Marketing; progressively larger P&L and global responsibilities | 1993–2015 | Extensive global operations, marketing, M&A, and supply chain oversight in life sciences; foundation for West’s market-led strategy and quality systems |
External Roles
| Organization | Role | Years | Notes |
|---|---|---|---|
| Ecolab Inc. | Director | Current | Public company directorship; complements healthcare/industrial exposure |
Fixed Compensation
Multi-year CEO compensation (Summary Compensation Table):
| Year | Salary ($) | Stock Awards ($) | Option Awards ($) | Non-Equity Incentive Comp ($) | Change in Pension Value & NQDC Earnings ($) | All Other Compensation ($) | Total ($) |
|---|---|---|---|---|---|---|---|
| 2024 | 1,170,696 | 3,400,248 | 3,400,043 | 294,690 | 7,249 | 121,275 | 8,394,201 |
| 2023 | 1,136,654 | 3,250,195 | 3,250,074 | 1,666,494 | 22,728 | 92,479 | 9,418,624 |
| 2022 | 1,098,462 | 3,000,289 | 2,999,992 | 675,324 | 0 | 130,994 | 7,905,061 |
Additional 2024 committee “decisions” context: Base salary $1,177,290; AIP target 125% of salary; LTI target $6.8M; TDC target $9.45M; AIP payout 20% of target ($294,690) reflecting below-target results and committee downward discretion .
Performance Compensation
Annual Incentive Plan (AIP) design and 2024 outcomes (Corporate metrics for NEOs):
| Metric | Weight | Target | Actual | Achievement % | Payout % for metric | Notes |
|---|---|---|---|---|---|---|
| EPS | 60% | $7.76 | $6.49 | 83.6% | 0.0% | Metric-specific curve adopted in 2024 |
| Consolidated Net Sales | 20% | $3,028.00 | $2,889.20 | 95.4% | 71.2% | Sales measured at budget FX |
| Operating Cash Flow | 20% | $700.10 | $662.90 | 94.7% | 62.1% | – |
| Corporate pool funding | – | – | – | – | 26.7% | Committee then applied 0.75x adjustment for each NEO, yielding 20% of target payout |
Long-Term Incentives (LTI) structure and 2022–2024 PSU outcomes:
- Structure: 50% PSUs (3-year performance on Sales CAGR and ROIC, equally weighted; 0–200% payout) and 50% stock options (4-year ratable vesting; 10-year term; strike = grant date close) .
- 2022–2024 PSU payout: 30.06% of target (Sales CAGR achieved 2.53% vs 9.30% target → 0%; ROIC achieved 18.41% vs 24.20% target → 60.12%) .
2024 Green LTI grants:
| Award | Grant date | Target/Count | Pricing/Value | Vesting |
|---|---|---|---|---|
| PSUs | 2/20/2024 | 9,710 target units | $350.18 grant FMV (for PSU value calc) | Earned on 2024–2026 Sales CAGR & ROIC; cliff in 2026 |
| Stock Options | 2/20/2024 | 25,221 options | Exercise price $350.18; Black-Scholes $134.81 | 25% per year over 4 years; 10-year term |
Equity Ownership & Alignment
Beneficial ownership (as of Feb 28, 2025):
| Holder | Common Stock | Options Exercisable Within 60 Days | % of Class |
|---|---|---|---|
| Eric M. Green | 171,121 | 402,609 | <1% |
Outstanding CEO equity and vesting supply/pressure indicators:
- Unvested PSUs at 12/31/2024: 20,369 units (FMV $6,672,039 at $327.56) .
- Option tranches outstanding for Green include: 2021 grant 32,739 exercisable/10,913 unexercisable at $274.29 expiring 2/23/2031; 2022 15,544/15,544 at $369.13 expiring 2/22/2032; 2023 7,468/22,404 at $306.68 expiring 2/21/2033; 2024 0/25,221 at $350.18 expiring 2/20/2034; earlier grants from 2017–2020 are fully exercisable .
- 2024 realizations: Green exercised 184,864 options for $54,238,490 of value and had 6,096 PSUs vest; realized values can contribute to episodic selling pressure during window periods .
Alignment policies and status:
- CEO ownership guideline: 6x base salary; all NEOs either met or are within the five-year attainment period; what counts includes 100% of owned and vested shares and 60% of unvested RSUs; unvested/exercisable options do not count .
- Anti-hedging and anti-pledging: Hedging prohibited; pledging prohibited for directors/officers (no waivers ever granted); no margin accounts; short sales banned .
- Deferred compensation participation and 2024 company contributions/DEUs for Green: $98,916 company contributions; $22,359 dividend equivalents .
Employment Terms
- CEO agreement (separate from standard officer CIC plan): On a qualifying termination in connection with a change-in-control (double trigger), cash severance equals 2x (base salary + average bonus over prior three years), plus 36 months of benefit continuation; equity vests at target levels; restrictive covenants and release required; no excise tax gross-ups; payments cut back if better after-tax .
- For other officers (context): CIC plan provides 2x (salary + target bonus), 24 months of benefits, equity vesting at target, pro rata bonus at target, and outplacement; double trigger; cutback if better after-tax; no gross-ups .
- Non-CIC severance: Officers (ex-CEO) covered under U.S. severance plan (one year’s salary and benefits continuation for terminations without cause, subject to covenants); CEO has separate terms negotiated at hire .
- Clawback: Robust incentive compensation recovery exceeding legal requirements, expanded in 2023 to cover all incentive forms and broader triggers .
- SERP: Present value of CEO’s accumulated SERP benefit $275,716 at 12/31/2024 (no new accruals beyond freeze mechanics); payable per plan terms .
- Perquisites/gross-ups: No perquisites provided to NEOs in 2024; no tax gross-ups .
Board Governance
- Role and independence: Green is Chair and CEO (non-independent); all other directors are independent; all committees (Audit, Compensation, Finance, Innovation & Technology, Nominating & Corporate Governance) are fully independent .
- Lead Independent Director: Paolo Pucci served through April 2025; Robert F. Friel appointed Lead Independent Director effective April 2025, with defined responsibilities for agenda setting, executive sessions, CEO evaluation, and succession oversight .
- Board service history: Green director since 2015; Chair since May 24, 2022 .
- Meeting attendance: In 2024 virtually all directors attended 100% of combined Board and committee meetings; all attended at least 90% .
- Director compensation: As an officer, Green receives no additional compensation for serving as Chair .
- Dual-role implications: Board annually reviews leadership structure; presence of a strong Lead Independent Director, regular executive sessions, and independent committees are intended to mitigate independence concerns from the combined Chair/CEO role .
Compensation Structure Analysis
- Pay-for-performance alignment: 2024 AIP paid at 20% of target (corporate pool 26.7% with a further 25% reduction), reflecting below-plan EPS and modest shortfalls on sales and OCF; 2022–2024 PSU cycle paid at 30.06% of target (0% Sales CAGR; 60.12% ROIC), demonstrating downside sensitivity to results .
- Mix and risk: CEO target TDC emphasizes at-risk equity (72% long-term for CEO; no option repricing; no guaranteed payouts) .
- Benchmarking and peer groups: TDC targeted at median; Business Segment Group includes West-relevant healthcare and industrial peers (e.g., Agilent, AptarGroup, Edwards Lifesciences, ResMed, Teleflex, STERIS) and a broader WTW talent market group; Pay Governance serves as independent consultant .
- Say-on-Pay: 2024 shareholder support 95.5%, consistent with prior years, indicating strong investor endorsement of design and targets .
Equity Ownership & Director Policies (Board Service)
- Stock ownership goals: Directors must hold shares equal to 5x annual retainer within three years; officer ownership goals as above; compliance monitored .
- Anti-hedging/pledging and securities trading policy: Strict prohibitions; documented governance and compliance oversight .
Performance & Track Record Highlights
| Area | Evidence |
|---|---|
| Operations and markets | 2024 pivot from COVID-era demand to normalized supply chains; returning to growth in Q4’24 in Proprietary Products with 4.5% organic growth; focus on GLP-1 demand and EU GMP Annex 1 opportunities . |
| Financial performance (2024) | Net sales $2.893B (-1.9% reported; -1.5% organic); reported diluted EPS $6.69 (-15.1%); operating margin 19.7% (-320 bps); operating cash flow $653.4M (-15.9%); capex $377.0M (13.0% of sales); FCF $276.4M (-33.3%) . |
| Capital allocation | >$560M returned via buybacks; 32nd consecutive annual dividend increase in 2024 . |
| TSR | 5-year TSR outperformance vs S&P 500 and S&P 500 Health Care Index (company disclosure) . |
Risk Indicators & Red Flags
- Positive: No related-party transactions to report; no hedging/pledging allowed; robust clawback; double-trigger CIC; no excise tax gross-ups; high Say-on-Pay support .
- Watch items: Combined Chair/CEO (mitigated by Lead Independent Director role); 2024 earnings/margin compression drove low incentive payouts and reflects near-term execution risk; ongoing large option/PSU calendars create periodic vesting overhang (managed via trading policy) .
Employment & Contracts: Key Economics
| Provision | CEO Green |
|---|---|
| CIC cash severance | 2x (base salary + average bonus over prior 3 years) |
| Benefit continuation | 36 months (medical/dental/life) |
| Equity upon CIC | Immediate vesting at target for equity awards; stock options vest |
| Triggers | Double trigger (requires termination after CIC); definitions of Cause/Good Reason per agreement |
| Covenants | Non-compete/non-solicit and release required; no tax gross-ups; potential cutback if better after-tax |
| Non-CIC severance | CEO under separate agreement; officers (not CEO) receive one year’s salary and benefits under severance plan for no-cause terminations |
Director Service Snapshot for Eric Green
- Board service: Director since 2015; Chair since 2022; non-independent .
- Committee roles: Serves as Chair of the Board; all committees comprised solely of independent directors (Green is not a committee member) .
- Lead Independent Director structure: In place with defined authorities (agenda approval, executive sessions, CEO evaluation/succession) .
- Attendance: Board reports near-perfect attendance in 2024 .
- Director pay: No additional compensation for Chair role as he is an officer .
Investment Implications
- Incentive alignment is strong: 2024 AIP paid 20% and 2022–2024 PSUs paid 30.06% of target, indicating down-capture when performance misses; clawback, anti-pledging, and 6x salary ownership guideline reinforce alignment .
- Retention risk appears low: Competitive median-targeted TDC with equity-heavy mix, robust CIC protection (double trigger) and long-dated options/PSUs support continuity through GLP-1 capacity ramp and Annex 1-driven demand .
- Trading/overhang considerations: Significant 2024 option exercise monetization ($54.2M realized) and ongoing option/PSU calendars could create periodic supply, but policies restrict hedging/pledging and enforce trading windows; monitor Form 4s around vesting dates for pressure signals .
- Governance trade-off: Combined Chair/CEO adds oversight risk, mitigated by a well-defined Lead Independent Director framework and fully independent committees; Say-on-Pay support (95.5%) suggests shareholder acceptance of structure and metrics .
References: West Pharmaceutical Services, Inc. DEF 14A (Mar 21, 2025) ; Prior DEF 14A disclosures for CIC specifics (Mar 24, 2021; Mar 21, 2018) .