Mark Morelli
XylemAbout Mark D. Morelli
Independent director since 2022, age 61, and current Chair of Xylem’s Leadership Development & Compensation Committee and member of the Audit Committee. He is President & CEO of Vontier Corporation; prior roles include CEO of Columbus McKinnon, President & COO of Brooks Automation, CEO of Energy Conversion Devices, and leadership positions at United Technologies; he began his career as a U.S. Army officer and helicopter pilot . The Board has determined he is independent under NYSE standards .
Past Roles
| Organization | Role | Tenure | Committees/Impact |
|---|---|---|---|
| Vontier Corporation | President & CEO; Director | 2020–present | Public company CEO and director; industrial technology and innovation focus |
| Columbus McKinnon | President & CEO | 2017–2020 | Led transformation and growth initiatives |
| Brooks Automation | President & COO | Not disclosed | Operations and manufacturing leadership |
| Energy Conversion Devices | President & CEO | Not disclosed | CEO experience in clean tech |
| United Technologies (Carrier Commercial Refrigeration) | President; various roles | Not disclosed | Global operations and manufacturing leadership |
| U.S. Army | Officer, helicopter pilot | Early career | Leadership and discipline foundation |
External Roles
| Organization | Role | Tenure | Notes |
|---|---|---|---|
| Vontier Corporation | Director | 2020–present | Current public company board |
| Columbus McKinnon | Director | 2017–2020 | Prior public company board |
Board Governance
- Committee assignments: Chair, Leadership Development & Compensation Committee (LDCC); Member, Audit Committee .
- Independence: Board determined all nominees other than the CEO are independent; Morelli is independent .
- Board/committee activity: 6 Board meetings, Audit met 7 times, LDCC met 5 times, Nominating & Governance met 3 times in 2024 .
- Attendance and engagement: >97% average attendance; each director nominee attended ≥94% of Board and applicable committee meetings; executive sessions held at all six Board meetings .
| Governance Attribute | 2024 Detail |
|---|---|
| Independence | Independent director |
| Committees | LDCC (Chair), Audit (Member) |
| Meeting cadence | Board: 6; Audit: 7; LDCC: 5; N&G: 3 |
| Attendance | ≥94% for each nominee; >97% average |
| Executive sessions | Held at all six Board meetings |
Fixed Compensation
| Component | Amount | Notes |
|---|---|---|
| Annual Cash Retainer | $105,000 | Standard non-employee director cash retainer |
| LDCC Chair Retainer | $20,000 | Additional cash retainer for committee chair role |
| Excess Meeting Fees | $2,000 in-person; $1,000 telephonic (if applicable) | Per-meeting fees beyond normal schedule |
| 2024 Cash Received (Actual) | $125,000 | Reported fees for Morelli in 2024 |
Performance Compensation (LDCC program design oversight and director equity)
- Director equity structure: Annual RSU grant; grants on AGM date and vest the day before the next AGM; at least 50% of director pay delivered in equity; no stock options for directors outstanding .
- 2024 Director grant details for Morelli: 1,156 RSUs granted on May 16, 2024 with grant date fair value $165,000 (based on $142.68 per share); elected to defer the 2024 RSU grant .
| Equity Award Detail | Value/Count | Terms |
|---|---|---|
| 2024 RSU grant (shares) | 1,156 | Granted May 16, 2024; vest day before next AGM |
| Grant-date fair value ($) | $165,000 | Valued at $142.68 per unit |
| Deferral election | Elected to defer 2024 RSUs | Under Director Deferred Compensation Plan |
| Options outstanding | None | No stock options outstanding for directors |
LDCC performance metric design (relevant to governance, not director pay):
- 2024 AIP team metrics: Organic Revenue ($8,520M target), Adjusted EBITDA ($1,670M target), Free Cash Flow Conversion (115% target); thresholds and max levels defined, with 0–200% payout scaling .
- 2024 team results: 137% team performance score; Organic Revenue $8,626M (131% payout), Adjusted EBITDA $1,762M (183%), FCF Conversion 113% (96%) .
- 2024–2026 PSU metrics: 50% rTSR vs S&P 500 ex-financials (0–200% with negative TSR cap at 100%), 25% Adjusted EBITDA (80–113.3% of target = 50–200% payout), 25% Revenue (90–110% of target = 50–200% payout) .
| AIP Metric (2024) | Target | Threshold (50%) | Target (100%) | Max (200%) |
|---|---|---|---|---|
| Organic Revenue | $8,520M | 95.6% of target | 100% of target | 104% of target |
| Adjusted EBITDA | $1,670M | 91.7% of target | 100% of target | 106.7% of target |
| Free Cash Flow Conversion | 115% | 90% | 115% | 130% |
| PSU Metric (2024–2026) | Target Definition | Payout Scale |
|---|---|---|
| rTSR vs S&P 500 (ex-FS) | 50th percentile = 100%; capped at 100% if absolute TSR negative | 0–200%; Threshold 25th percentile (25%), Max ≥83rd percentile (200%) |
| Adjusted EBITDA | 100% of 2026 Adjusted EBITDA target = 100% | 50% at 80%; 200% at 113.3% |
| Revenue | 100% of 2026 Revenue target = 100% | 50% at 90%; 200% at 110% |
Say-on-Pay signal: 82.7% approval in 2024; LDCC engaged shareholders and implemented 2025 design changes (AIP 100% team metrics: EBITDA Margin (Adjusted), Organic Revenue, FCF Margin (Adjusted); PSU metrics moving to Adjusted Cumulative EPS and rTSR vs S&P 500 Industrials) .
Other Directorships & Interlocks
| Company | Relationship to Xylem | Potential Conflict Notes |
|---|---|---|
| Vontier Corporation (CEO and Director) | No disclosed related-party transactions with Xylem | Xylem’s policy requires review of outside commitments and conflicts; none disclosed since Jan 1, 2024 |
| Columbus McKinnon (former Director) | Prior role only | Historical; no current interlock |
Expertise & Qualifications
- Industrial technology and innovation, operations, manufacturing, and strategy; nearly two decades leading transformative growth and innovation .
- Committee leadership experience as LDCC Chair; financial literacy for Audit membership .
- Leadership development, inclusion and belonging; climate-related risk and sustainability perspectives through industrial experience .
Equity Ownership
| Ownership Metric | Amount | Notes |
|---|---|---|
| Total beneficially owned shares | 3,835 | Includes vested but deferred RSUs |
| Vested but deferred RSUs | 1,812 | Deferred under director plan |
| Unvested RSUs (outstanding) | 1,156 | 2024–2025 director grant |
| Ownership % of shares outstanding | <1% | Company-wide denominator 243,322,974 shares (Mar 7, 2025) |
| Pledging/Hedging | Prohibited by policy | Robust insider trading policy; no pledging permitted |
| Stock ownership guideline | 5× annual cash retainer | All directors met or on track as of Mar 7, 2025 |
Governance Assessment
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LDCC Chair role is pivotal for pay-for-performance integrity; 2024 Say‑on‑Pay at 82.7% and documented shareholder engagement with 2025 program simplification and stronger accountability signals positive responsiveness to investors .
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Attendance and engagement strong (≥94% for nominees; >97% overall), with regular executive sessions and active committee cadence, supporting board effectiveness .
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Independence and conflict controls: independent status; policy limiting outside board seats for public company executives (≤3 including their own and Xylem), review of conflicts; no related-party transactions disclosed since Jan 1, 2024; prohibition on pledging/hedging/shorting reduces alignment risks .
-
Director Compensation Alignment: Mix of cash ($105k retainer + $20k LDCC chair) and equity ($165k RSUs), with robust ownership guidelines (5× retainer) and compensation cap ($750k/year), indicating moderated risk of pay inflation and alignment incentives .
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RED FLAGS
- Sitting public-company CEO while serving as LDCC Chair can raise overboarding/time‑commitment concerns; mitigated by Xylem’s policy cap (≤3 boards for public-company executives) and N&G review of new affiliations—current commitments appear within guidelines .
- Beneficial ownership is modest in absolute share count; mitigated by director stock ownership guidelines and deferral/holding expectations .
- No disclosed related-party transactions, tax gross-ups, or option repricings; hedging/pledging prohibited—no immediate red flags from conflicts or pay practices .