☐ | Preliminary Proxy Statement |
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☒ | Definitive Proxy Statement |
☐ | Definitive Additional Materials |
☐ | Soliciting Material Pursuant to §240.14a-12 |
☒ | No fee required. |
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Photo: Courtesy of Brookfield Properties
Brookfield Place, New York City, is among the U.S. office assets that CBRE is managing under a strategic partnership with Brookfield Properties, announced in January 2024.
2100 McKinney Avenue, Suite 1250 Dallas, Texas 75201 (214) 979-6100 |
April 12, 2024
Dear Fellow Stockholder:
On behalf of the Board of Directors and management of CBRE Group, Inc., I cordially invite you to attend our annual meeting of stockholders on Wednesday, May 22, 2024 at 11:00 a.m. (Central Time) (the “Annual Meeting” or the “2024 Annual Meeting”). The 2024 Annual Meeting will be a virtual meeting of stockholders. You will be able to attend the 2024 Annual Meeting, vote your shares electronically and submit your questions during the meeting via live webcast by visiting www.virtualshareholdermeeting.com/CBRE2024. Stockholders will be able to listen, vote, and submit questions from their home or any location with internet connectivity. To participate in the meeting, you must have the 16-digit number that is shown on your Notice of Internet Availability of Proxy Materials or on your proxy card if you elected to receive proxy materials by mail. The notice of meeting and proxy statement that follow describe the business that we will consider at the meeting.
We hope that you will be able to attend the meeting via our live webcast. However, regardless of whether you attend the meeting, your vote is very important. We are pleased to again offer multiple options for voting your shares. Regardless of whether you attend, please take advantage of this opportunity to vote your shares.*
Thank you for your continued support of CBRE Group, Inc.
Robert E. Sulentic
Chair, President and Chief Executive Officer
*Please see page 1 of this Proxy Statement for the many options available to vote your shares and other details on how you can participate in our Annual Meeting.
Notice of 2024 Annual
Meeting of Stockholders
Date: Wednesday, May 22, 2024
Time: 11:00 a.m. (Central Time)
Virtual Meeting Website: www.virtualshareholdermeeting.com/CBRE2024
Record Date: March 28, 2024 |
Your Vote Matters — How to Vote:
Online
Visit www.proxyvote.com. You will need the 16-digit number included in your proxy card, voter instruction form or notice. | ||
Phone
Call 1-800-690-6903 or the number on your voter instruction form. You will need the 16-digit number included in your proxy card, voter instruction form or notice. | ||
Send your completed and signed proxy card or voter instruction form to the address on your proxy card or voter instruction form. | ||
Via Webcast During the Annual Meeting
Visit www.virtualshareholdermeeting.com/CBRE2024. You will need the 16-digit number included in your proxy card, voter instruction form or notice. Online access begins at 10:45 a.m. (Central Time). |
Agenda:
1. | Elect the 11 Board-nominated directors named in the Proxy Statement; |
2. | Ratify the appointment of KPMG LLP as our independent registered public accounting firm for the fiscal year ending December 31, 2024; |
3. | Conduct an advisory vote on named executive officer compensation for the fiscal year ended December 31, 2023; and |
4. | Transact any other business properly introduced at the Annual Meeting. |
Your vote is important, and you are encouraged to vote promptly whether or not you plan to virtually attend the 2024 Annual Meeting of Stockholders.
We hope that you can attend the Annual Meeting. Regardless of whether you will attend via our live webcast, please complete and return your proxy so that your shares can be voted at the Annual Meeting in accordance with your instructions.
Important Notice Regarding the Availability of Proxy Materials for the 2024 Annual Meeting of Stockholders to be held on Wednesday, May 22, 2024: Our Proxy Statement and 2023 Annual Report are available free of charge on our website or www.proxyvote.com.
We believe that this allows us to provide you with the information that you need while lowering the costs of delivery and reducing the environmental impact of the Annual Meeting.
April 12, 2024
By Order of the Board of Directors
Chad Doellinger
Executive Vice President, General Counsel and Corporate Secretary
This Proxy Statement and accompanying proxy card are first being made available on or about April 12, 2024. References in this Proxy Statement to “CBRE,” “the company,” “we,” “us” or “our” refer to CBRE Group, Inc. and include all of its consolidated subsidiaries, unless otherwise indicated or the context requires otherwise. References to “the Board” refer to our Board of Directors. A copy of our Annual Report for the fiscal year ended December 31, 2023, including financial statements, is being sent simultaneously with this Proxy Statement to each stockholder who requested paper copies of these materials and will also be available at www.proxyvote.com.
CBRE 2024 PROXY STATEMENT | PROXY SUMMARY | 1 |
Proxy Summary
To help you review the proposals to be voted upon at our 2024 Annual Meeting, we have summarized important information in this Proxy Statement and in our Annual Report on Form 10-K for the fiscal year ended December 31, 2023. This summary does not contain all of the information that you should consider, and you should carefully read the entire Proxy Statement and Annual Report on Form 10-K before voting. |
Voting
Stockholders of record as of March 28, 2024 may cast their votes in any of the following ways:
| ||||||
Online
Visit www.proxyvote.com. You will need the 16-digit number included in your proxy card, voter instruction form or notice. |
Phone
Call 1-800-690-6903 or the number on your voter instruction form. You will need the 16-digit number included in your proxy card, voter instruction form or notice. |
Send your completed and signed proxy card or voter instruction form to the address on your proxy card or voter instruction form. |
Via Webcast During the Annual Meeting
Visit www.virtualshareholdermeeting.com/CBRE2024. You will need the 16-digit number included in your proxy card, voter instruction form or notice. Online access begins at 10:45 a.m. (Central Time). | |||
Voting Matters and Board Recommendation
Proposals |
Board recommendation | Page reference | ||||
1. Elect Directors |
FOR each nominee | 23 | ||||
2. Ratify the Appointment of Independent Registered Public Accounting Firm for 2024 |
FOR | 37 | ||||
3. Advisory Vote to Approve Named Executive Officer Compensation for 2023 |
FOR | 40 |
CBRE 2024 PROXY STATEMENT | PROXY SUMMARY | 2 |
Our Corporate Strategy
We aspire to expand our position as the leading global commercial real estate services and investment firm, defined by our scale and the superior outcomes we deliver for our constituents.
We have developed a concise strategy that we have executed over many years, fine-tuning it as market circumstances change and opportunities emerge. Our strategy consists of the following key elements:
• | Build broad and deep presence across four key dimensions of our business: client type, service line, asset type and geography. |
• | Deliver strong organic and inorganic growth, leveraging and building on the benefits of scale. |
• | Integrate differentiated services to deliver superior client solutions. |
• | Focus financial and operational resources on disproportionately growing our resilient businesses. |
• | Leverage our functional and knowledge platform to support the growth of our business and the quality of our integrated solutions. |
• | Identify, attract and empower top talent. |
• | Continually focus on efficiency and cost to advance our margin advantage. |
Sustainability and Social Responsibility
In 2023, we continued to make strides on our initiatives to be a sustainable and responsible company. We believe we are well-positioned to lead our industry in providing climate change solutions that significantly reduce greenhouse gas (GHG) emissions. Our Net Zero Roadmap for Corporate Operations guides our actions to help us achieve our interim targets to reduce our GHG emissions by 2035 and reach our net zero goal by 2040. Key initiatives include goals of purchasing 100% renewable energy for our offices and electrifying our vehicle and equipment fleet.
Driving progress on diversity, equity and inclusion at CBRE and in the broader commercial real estate industry is a company-wide priority. In 2023, we spent nearly $2 billion with diverse suppliers as we work toward our pledge to spend $3 billion with diverse suppliers annually by the end of 2025. We also partner with organizations to increase outreach to and help to develop diverse talent underrepresented in our industry.
We are committed to providing transparent, meaningful sustainability information to stakeholders and publish information in accordance with the International Sustainability Standards Board’s (ISSB) disclosures, including industry-specific SASB standards and the Task Force on Climate-related Financial Disclosures (TCFD) in our Corporate Responsibility Report (CR Report). In addition, our CR Report was prepared in accordance with the Global Reporting Initiative (GRI) Standards and we have participated in the United Nations Global Compact (UNGC) and supported its Ten Principles since 2007.
To learn more, please read our Corporate Responsibility Report at www.cbre.com/responsibility. The information contained on or available through this website is not a part of, or incorporated by reference into, this Proxy Statement.
CBRE 2024 PROXY STATEMENT | PROXY SUMMARY | 3 |
Awards & Recognition
In 2023 and early 2024, we were recognized with the following awards and accolades:
MOST ADMIRED REAL ESTATE COMPANIES
Fortune Magazine, fourteen years in a row, including 2024 |
MOST RECOGNIZED COMMERCIAL REAL ESTATE BRAND
Lipsey Company Survey, 23rd consecutive year, including 2024 |
WORLD’S MOST ETHICAL COMPANY Ethisphere Institute, 11th consecutive year, including 2024 | ||||||
A TOP COMPANY FOR CAREER GROWTH
The Wall Street Journal ranks us within the top 10% of Fortune 500 companies for creating opportunities for people to advance their careers, outperforming all other real estate companies |
LISTED IN THE BLOOMBERG GENDER EQUALITY INDEX
For four consecutive years, including 2023 |
3rd MOST SUSTAINABLE U.S. COMPANY
Barron’s, making top 100 list for seven consecutive years, including 2024 |
Corporate Governance Highlights
We are committed to good corporate governance, which promotes the long-term interests of stockholders, strengthens Board and management accountability, and helps build public trust in our company. Our governance practices include:
• | Robust director selection process resulting in a diverse Board in terms of experience, skills, tenure, gender, race and ethnicity |
• | Strong lead independent director, elected by independent directors |
• | 10 out of 11 of our director nominees are independent |
• | 6 out of 11 of our director nominees are diverse in terms of gender, race or ethnicity |
• | 100% independent Board committees |
• | Annual election of directors |
• | Majority voting standard for uncontested elections |
• | 12-year director term limit |
• | Board diversity policy to actively seek out women and underrepresented candidates |
• | No “over-boarding” by our directors on other public-company boards |
• | Proxy access rights for director nominations |
• | Maximum of one Board-nominated management director |
• | Annual Board, committee and individual director evaluations and self-assessments |
• | Regular executive sessions, where independent directors meet without management present |
• | Active Board oversight of strategy, risk management, sustainability, social responsibility and governance matters |
• | Stock ownership requirements for directors and executive officers |
• | Policy restricting trading, and prohibiting hedging and short-selling, of CBRE stock |
• | Ongoing stockholder outreach and engagement |
• | Stockholder rights to call a special meeting |
• | No poison pill takeover defense plans |
CBRE 2024 PROXY STATEMENT | PROXY SUMMARY | 4 |
Our Board Nominees
Our Board nominees exhibit a mix of skills, experience, diversity and perspectives:
Name | Age | Director Since |
Principal Occupation | Independent | Committees | Other Public Company Boards | ||||||||
Brandon B. Boze |
43 | 2012 | Former Partner and President of ValueAct Capital | ● | – Compensation – Corporate Governance and Nominating – Executive |
0 | ||||||||
Beth F. Cobert |
65 | 2017 | Former President of the Markle Foundation | ● | – Compensation (Chair) |
0 | ||||||||
Reginald H. Gilyard |
60 | 2018 | Senior Advisor to The Boston Consulting Group | ● | – Compensation – Corporate Governance and Nominating |
3 | ||||||||
Shira D. Goodman Lead Independent Director |
63 | 2019 | Advisory Director to Charlesbank Capital Partners | ● | – Executive (Chair) |
1 | ||||||||
E.M. Blake Hutcheson |
63 | 2022 | President and Chief Executive Officer of OMERS | ● | – Audit – Compensation |
1 | ||||||||
Christopher T. Jenny |
68 | 2016 | Chair and Chief Executive Officer of Jennus Innovation | ● | – Corporate Governance and Nominating (Chair) |
0 | ||||||||
Gerardo I. Lopez |
64 | 2015 | Former Executive-in-Residence at Softbank Investment Advisers | ● | – Audit (Chair) – Executive |
2 | ||||||||
Guy A. Metcalfe |
56 | 2024 | Former Managing Director and Global Chair of Real Estate of Morgan Stanley | ● | – Compensation – Corporate Governance and Nominating |
1 | ||||||||
Oscar Munoz |
65 | 2020 | Former Chair and Chief Executive Officer of United Airlines Holdings | ● | – Audit – Corporate Governance and Nominating |
2 | ||||||||
Robert E. Sulentic Board Chair |
67 | 2012 | Chair, President and Chief Executive Officer of CBRE | – Executive |
0 | |||||||||
Sanjiv Yajnik |
67 | 2017 | President of Capital One Financial Services | ● | – Audit – Compensation |
0 |
Female Directors |
Racially and Ethnically Diverse Directors |
Board Committees Chaired by Women |
Independent Directors | |||
18% | 36% | 50% | 91% | |||
CBRE 2024 PROXY STATEMENT | PROXY SUMMARY | 5 |
2023 Business Highlights
Revenue | Net Revenue (1) | GAAP Net Income | ||||||
$31.9B | $18.3B | $986M | ||||||
+3.6% | -2.7% | -30.0% | ||||||
Core EBITDA (1) | GAAP EPS | Core EPS (1) | ||||||
$2.2B | $3.15 | $3.84 | ||||||
-24.5% | -26.6% | -32.5% | ||||||
1-Year Total Stockholder Return (2) (as of 12/31/2023) | 3-Year Total Stockholder Return (2) (as of 12/31/2023) | 5-Year Total Stockholder Return (2) (as of 12/31/2023) | ||||||
21% | 48% | 132% | ||||||
vs. 26% for S&P 500 (-5% underperformance) |
vs. 33% for S&P 500 (+15% outperformance) |
vs. 107% for S&P 500 (+25% outperformance) |
(1) | These are non-GAAP financial measures. For definitions and more information, see Annex A of this Proxy Statement. Our Board and management use these non-GAAP financial measures to evaluate our performance and manage our operations. However, non-GAAP financial measures should be viewed in addition to, and not as an alternative for, financial results prepared in accordance with GAAP. The term “GAAP,” as used in this Proxy Statement, means generally accepted accounting principles in the United States. |
(2) | Inclusive of dividends, assuming reinvestment. |
Company Performance and Financial Highlights
Our pay-for-performance approach aligns management and stockholder interests. The real estate capital markets environment weighed on our business performance in 2023, particularly the transactional business lines within the Advisory Services and Real Estate Investments segments, which are sensitive to market cycles. While overall net revenue fell 3%, our Resilient Businesses (including the entire GWS business, property management, loan servicing, asset management fees in Investment Management and valuations), together, grew net revenue at a 10% clip. These businesses are well-positioned for growth across market cycles. On the other hand, revenue from our Transactional Businesses (sales, leasing, mortgage origination, carried interest and incentive and development fees) slumped 21% last year, but are poised to resume growth when the market cycle turns. Despite the year’s challenges, we invested approximately $961.3 million in share buybacks (repurchasing approximately 7,867,348 shares), infill M&A and other strategic investments, while ending the year below the midpoint of our target leverage range, giving us substantial liquidity to finance future growth.
CBRE 2024 PROXY STATEMENT | PROXY SUMMARY | 6 |
Comparison of 5-Year Cumulative Total Return(1) among CBRE Group, Inc., the S&P 500 Index(2) and Peer Group(3)
|
(1) | $100 invested on December 31, 2018 in stock or index-including reinvestment of dividends, fiscal year ending December 31. |
(2) | Copyright© 2024 Standard & Poor’s, a division of S&P Global. All rights reserved. |
(3) | Peer group contains companies with the following ticker symbols: JLL, CIGI, CWK, ISS, MMI, NMRK, SVS.L (London) and WD. |
Executive Compensation Highlights
Our Pay-for-Performance Compensation Philosophy
Our executive compensation program is designed to:
• | Align pay and performance; |
• | Reinforce our corporate strategy; |
• | Attract and retain accomplished and high-performing executives; and |
• | Motivate those executives to consistently achieve short- and long-term goals to further our corporate strategy. |
To do this, we focus a significant percentage of our executive officers’ compensation on both annual and long-term incentive awards intended to drive growth in our business and in our share price in the short- and long-term, with a relatively modest portion of compensation paid in fixed base salary.
2023 Total Target Direct Compensation Mix
The total 2023 target direct compensation mix is shown here:
CEO Target Compensation Mix
|
CBRE 2024 PROXY STATEMENT | PROXY SUMMARY | 7 |
2023 Performance and NEO Compensation
2023 was a difficult year for commercial real estate. The tougher operating environment led to reduced cash bonuses for all of our named executive officers. Compared with annual cash bonus targets, 2023 cash bonuses awarded to our named executive officers averaged 86.2% of target, and ranged from 76.5% to 94.1%.
2022 Core EPS Awards, the vesting of which was based on our two-year cumulative Core EPS performance during 2022 and 2023, were paid out at 0% (i.e., all 2022 Core EPS Equity Awards were forfeited). This reflected financial results that were below target due to the challenging market environment that prevailed for most of the two-year performance period.
In 2023, as part of the review of target annual compensation opportunities, the Compensation Committee approved increases to the annual long term-term equity targets for Mses. Giamartino and Dhandapani. The Compensation Committee also approved an increase to Ms. Giamartino’s salary and EBP target. These increases (from 2022) were intended to align their compensation with market levels.
2023 NEO Total Annual Compensation
Set forth below is the 2023 annual compensation for our named executive officers.
Name and Principal Position |
Year | Salary ($) |
Bonus ($) |
Annual Stock ($) |
Non-Equity Incentive Plan Compensation ($) |
All Other Compensation ($) |
Total ($) |
|||||||||||||||||||||
Robert E. Sulentic Chair, President and Chief Executive Officer |
2023 | 1,250,000 | — | 14,749,941 | 2,352,893 | 6,000 | 18,358,834 | |||||||||||||||||||||
Emma E. Giamartino Chief Financial Officer |
2023 | 695,000 | — | 3,199,880 | 980,273 | 6,000 | 4,881,153 | |||||||||||||||||||||
Chandra Dhandapani Former Chief Executive Officer, |
2023 | 750,000 | — | 3,649,996 | 1,020,417 | 6,000 | 5,426,413 | |||||||||||||||||||||
John E. Durburg Chief Executive Officer of U.S. and Canada, |
2023 | 775,000 | — | 4,064,992 | 887,973 | 6,000 | 5,733,965 | |||||||||||||||||||||
Daniel G. Queenan Chief Executive Officer, |
2023 | 775,000 | — | 4,064,992 | 908,371 | 6,000 | 5,754,363 |
2024 Updates to Long-Term Incentive Award Design
As part of the Committee’s annual review of our compensation program, and in response to feedback from our investors, the Compensation Committee approved a change to the design of our annual performance-based awards. Beginning in 2024, our annual performance-based awards will incorporate two metrics—core EPS and relative total shareholder return. For additional information, see our Form 8-K filed on March 11, 2024.
CBRE 2024 PROXY STATEMENT | PROXY SUMMARY | 8 |
Forward-Looking Statements
This Proxy Statement contains forward-looking statements within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995, including statements regarding the company’s sustainability and social responsibility targets, strategies and goals. These forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause the company’s actual results and performance in future periods to be materially different from any future results or performance suggested in forward-looking statements in this Proxy Statement. Any forward-looking statements speak only as of the date of this Proxy Statement and, except to the extent required by applicable securities laws, the company expressly disclaims any obligation to update or revise any of them to reflect actual results, any changes in expectations or any change in events. If the company does update one or more forward-looking statements, no inference should be drawn that it will make additional updates with respect to those or other forward-looking statements. Readers are urged to carefully review and consider the various disclosures made in the company’s Annual Report for the year ended December 31, 2023, particularly those under the captions “Cautionary Note on Forward-Looking Statements,” “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” as well as in the company’s press releases and other periodic filings with the SEC.
This Proxy Statement contains certain voluntary disclosures regarding our sustainability and social responsibility goals and related matters because we believe these matters are of interest to our investors; however, we do not believe these disclosures are “material” as that concept is defined by or construed in accordance with the securities laws or any other laws of the U.S. or any other jurisdiction, or as that concept is used in the context of financial statements and financial reporting. These disclosures speak only as of the date on which they are made, and we undertake no obligation and expressly disclaim any duty to correct or update such disclosures, whether as a result of new information, future events or otherwise, except as required by applicable law.
CBRE 2024 PROXY STATEMENT | TABLE OF CONTENTS | 9 |
Table of Contents
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25 | ||||
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28 | ||||
35 | ||||
Proposal 2: Ratify Appointment of Independent Registered Public Accounting Firm | 37 | |||
38 | ||||
38 | ||||
38 | ||||
CBRE 2024 PROXY STATEMENT | CORPORATE GOVERNANCE — GOVERNANCE HIGHLIGHTS | 10 |
Corporate Governance
Our Corporate Governance framework is designed to strengthen the Board of Directors’ oversight of management and to serve the long-term interests of our stockholders, employees and other stakeholders. Governance is a continuous focus for us, starting with our Board and committees of the Board that meet several times throughout the year, and extending to management and our employees. We are committed to maintaining the highest standards of business conduct and corporate governance.
Governance Highlights
Corporate Governance
• | Robust director selection process resulting in a diverse Board in terms of experience, skills, tenure, gender, race and ethnicity |
• | 11 director nominees, 10 of whom are independent |
• | Director term limits (12 years) |
• | Strong lead independent director, elected by independent directors |
• | 100% independent committees |
• | Board diversity policy to actively seek out women and underrepresented candidates |
• | Active Board oversight of strategy, risk management, sustainability, social responsibility and governance matters |
• | Annual Board, committee and individual director evaluations and self-assessments |
• | Maximum of one Board-nominated management director |
• | Robust Standards of Business Conduct and governance policies |
• | No “over-boarding” by our directors on other public-company boards |
Compensation
• | Pay-for-performance compensation program, which includes performance-based equity grants |
• | Annual “say on pay” votes, with most recent favorable “say on pay” vote of approximately 93% |
• | Stock ownership requirements for directors and executive officers |
• | Policy restricting trading, and prohibiting hedging and short-selling, of CBRE stock |
Stockholder Rights
• | Annual election of all directors |
• | Majority voting requirement for directors in uncontested elections |
• | Stockholder rights to call special meetings |
• | No poison pill takeover defense plans |
• | Stockholders may act by written consent |
• | Proxy access for director nominations |
• | Ongoing stockholder outreach and engagement |
Corporate Governance Materials
The following materials, along with other Governance documents, are available on our website, https://ir.cbre.com/leadership/governance-documents.
| ||
• Standards of Business Conduct
• Corporate Governance Guidelines
• Policy Regarding Transactions with Interested Parties
• Whistleblower Policy
• Equity Award Policy
• Anti-Corruption Policy
• Charter, By-laws and Board Committee Charters
|
These materials are also available in print to any person, without charge, by emailing us at investorrelations@cbre.com or by written request to:
Investor Relations Department CBRE Group, Inc. 2100 McKinney Avenue, Suite 1250 Dallas, Texas 75201 |
CBRE 2024 PROXY STATEMENT | CORPORATE GOVERNANCE — GOVERNANCE HIGHLIGHTS | 11 |
Governance Policies & Practices
Standards of Business Conduct. Our Board has adopted a Standards of Business Conduct applicable to all directors, officers and employees that states our corporate values and ethical standards, including our commitment to respect, integrity, service and excellence. We are firmly committed to conducting business with the highest integrity and in compliance with the letter and spirit of the law. If the Board grants any waivers from the Standards of Business Conduct to any of our directors or executive officers, or if we amend such policies, we will, if required, disclose these matters through the Investor Relations section of our website on a timely basis.
Corporate Governance Guidelines. Our Board has adopted Corporate Governance Guidelines, which provide a framework within which our Board, assisted by its committees, directs our affairs.
Board Diversity Policy. As part of the search process for a new director, the Corporate Governance and Nominating Committee of our Board, or Governance Committee, will actively seek out women and underrepresented candidates to include in the pool from which Board nominees are chosen and will instruct any search firm engaged for the search to provide a set of candidates that includes both underrepresented people of color and different genders.
Director Overboarding Policy. Our directors who are public company executive officers may serve on no more than two public company boards (including the company’s Board). Directors that are not public company executive officers may serve on no more than five public company boards (including the company’s Board), or to the extent such director is the chair or lead independent director of a public company board, then no more than four public company boards (including the company’s Board). Consideration is also given to the nature of and time involved in a director’s service on other boards (including public company leadership roles) and other outside commitments.
Policy Regarding Transactions with Interested Parties and Corporate Opportunities. Our Board has adopted a related-party transactions and corporate opportunities policy that directs our Audit Committee to review and approve, among other things, potential conflicts of interest between us and our directors and executive officers.
Whistleblower Policy. We have a Whistleblower Policy that directs our Audit Committee to investigate complaints (received directly or through management) regarding:
• | deficiencies in or noncompliance with our internal accounting controls or accounting policies; |
• | circumvention of our internal accounting controls; |
• | fraud in the preparation or review of our financial statements or records; |
• | misrepresentations regarding our financial statements or reports; |
• | violations of legal or regulatory requirements; and |
• | retaliation against whistleblowers. |
Equity Award Policy. We have an Equity Award Policy that is designed to maintain the integrity of the equity award process and to ensure compliance with all applicable laws. The Equity Award Policy sets forth the procedures that must be followed in connection with employee awards. Our Equity Award Policy is described in greater detail under the heading “Compensation Discussion and Analysis—Section 6. Compensation Policies and Practices.”
Anti-Corruption Policy. Our global Anti-Corruption Policy contains strict prohibitions on any employee or agent of the company offering or providing anything that could be perceived as a bribe to gain or maintain any business advantage.
Compensation Clawback Policy. We have a policy that requires us to recover cash-based and performance-based-equity incentive compensation paid to any current or former “Section 16 officer” if there is a restatement of our financial results. The policy mandates clawback from any applicable officer who received an award overpayment, without regard to whether any misconduct occurred or whether an officer bears responsibility for the required restatement. Our Compensation Clawback Policy is described in greater detail under the heading “Compensation Discussion and Analysis—Section 6. Compensation Policies and Practices.”
CBRE 2024 PROXY STATEMENT | CORPORATE GOVERNANCE — STOCK OWNERSHIP REQUIREMENTS | 12 |
Stock Ownership Requirements
In order to align the interests of our executives and Board members with the interests of our stockholders, the Compensation Committee has adopted executive officer stock ownership requirements that are applicable to all of our Section 16 officers. In addition, our Board has adopted stock ownership requirements for non-employee directors.
Executive Officers
Our executive officers have a minimum common stock ownership requirement of two to six times their annual base salary. Our CEO’s minimum ownership requirement is six times his annual base salary and each other NEO’s minimum ownership requirement is three times their annual base salary. If at any time an executive officer’s equity holdings do not satisfy these minimum ownership requirements, depending on his or her position, the executive must retain 100% (for our CEO) or 75% (for our other named executive officers) of the shares remaining after payment of taxes and exercise price upon the exercise of stock options or upon the vesting of restricted stock or the settlement of vested restricted stock units, as applicable.
Shares that count toward compliance with the requirements include:
• | shares owned outright (either directly or indirectly); |
• | shares issued upon the settlement of vested restricted stock units; and |
• | allocated shares in other company benefit plans. |
Shares that do not count toward achievement of the requirements include:
• | unexercised outstanding stock options (whether or not vested); and |
• | unvested/unearned restricted stock and restricted stock units. |
Non-Employee Directors
Each non-employee director has a minimum common stock ownership requirement of five times the value of the annual stock grants made by us to the non-employee director pursuant to our director compensation plan. If at any time the common stock ownership requirement is not satisfied, the director must retain 100% of the shares remaining after payment of taxes and exercise price upon exercise of stock options, the vesting of restricted stock or the settlement of vested restricted stock units, as applicable.
Shares that count toward compliance with the requirements include:
• | shares owned outright by the director (either directly or beneficially, e.g., through a family trust); and |
• | shares issued upon the settlement of vested restricted stock units. |
Shares that do not count toward achievement of the requirements include:
• | shares held by mutual or hedge funds in which the non-employee director is a general partner, limited partner or investor; |
• | unexercised outstanding stock options (whether or not vested); |
• | unvested/unearned restricted stock units or restricted stock; and |
• | shares transferred to a non-employee director’s employer pursuant to such employer’s policies. |
Board Structure and Leadership
All of our directors are elected at each annual meeting of stockholders and hold office until the next election. Our Board has authority under our by-laws to fill vacancies and to increase or, upon the occurrence of a vacancy, decrease its size between annual meetings of stockholders.
We believe strong independent leadership is essential for the Board to effectively perform its functions and to help ensure independent oversight of management. Our Corporate Governance Guidelines provide the Board with the flexibility to choose the appropriate Board leadership structure for the company based on what it believes is best for the company and its shareholders at a given point in time. Our Corporate Governance Guidelines also provide that if the same person holds the chair and chief executive officer roles, or if the chair is not independent, then the independent directors will elect from among themselves, on an annual basis, a lead independent director.
Currently, our Board leadership structure consists of a lead independent director, a Board chair (who is also our chief executive officer) and strong independent committee chairs. The Board believes our structure provides independent Board leadership with the benefit of our chief executive officer serving as the chair at our regular board meetings. The Board regularly reviews its leadership structure and has determined that this structure is in the best interests of the company and its shareholders at this time. Among other factors, the Board considered and evaluated: Mr. Sulentic’s deep knowledge of CBRE and extensive commercial real estate experience, the importance of consistent, unified leadership to execute and oversee the company’s strategy, the strong and highly independent composition of the Board and the meaningful responsibilities of the lead independent director.
Shira D. Goodman has served as our lead independent director since November 2023 and has been a director since 2019. The independent directors believe that Ms. Goodman is well suited to serve as lead independent director given her significant managerial, operational and global experience. As a result of her broad-based and relevant background, Ms. Goodman is well-positioned as lead independent director to provide constructive, independent and informed guidance and oversight to management. The Board believes that the presence of our lead independent director who has meaningful oversight responsibilities, together with a combined chair and chief executive officer, provides the company with the optimal leadership to drive the company forward at this time.
CBRE 2024 PROXY STATEMENT | CORPORATE GOVERNANCE — DIRECTOR INDEPENDENCE | 13 |
Director Independence
Under our Board’s Corporate Governance Guidelines and the listing standards of the NYSE, our Board must consist of a majority of independent directors. In addition, all members of the Audit Committee, Compensation Committee and Governance Committee must be independent directors as defined by our Corporate Governance Guidelines and NYSE listing standards. Members of the Compensation Committee must also meet applicable NYSE independence requirements for compensation committee members, and members of the Audit Committee must further satisfy a separate SEC independence requirement, which generally provides that they may not (i) accept directly or indirectly any consulting, advisory or other compensatory fee from us or any of our subsidiaries, other than their compensation as directors or members of the Audit Committee or any other committees of our Board or (ii) be an affiliated person of ours.
Our Board regularly conducts a review of possible conflicts of interest and related-party transactions through the use of questionnaires, director self-reporting and diligence conducted by management. This review includes consideration of any investments and agreements between directors and their related persons and the company, including those described under “Related-Party Transactions” in this Proxy Statement, and such person’s beneficial ownership of our securities. The Board has determined that 91% of our director nominees (all except for Mr. Sulentic) are independent in accordance with NYSE listing standards and our Board’s Categorical Independence Standards that it has adopted relating to our director independence. These Categorical Independence Standards are posted on the Corporate Governance section of the Investor Relations page on our website at www.cbre.com. The information contained on or available through this website is not a part of, or incorporated by reference into, this Proxy Statement.
CBRE 2024 PROXY STATEMENT | CORPORATE GOVERNANCE — BOARD MEETINGS AND COMMITTEES | 14 |
Board Meetings and Committees
Our Board held seven meetings during fiscal year 2023 to review significant developments, engage in strategic planning and act on matters requiring Board approval. In 2023, each incumbent director attended at least 75% of our Board meetings and meetings of committees on which he or she served (taken in the aggregate) during the period that he or she served thereon.
Our Board currently has four standing committees that met or acted by written consent during fiscal year 2023: the Audit Committee, the Compensation Committee, the Governance Committee and the Executive Committee. Each committee (other than the Executive Committee) is composed entirely of directors whom our Board has determined to be independent under current NYSE standards. Each committee operates under a charter approved by our Board that sets out the purposes and responsibilities of the committee and that are published in the Corporate Governance section of the Investor Relations page on our website at www.cbre.com. In accordance with our Board’s Corporate Governance Guidelines, our Board and each of the Audit Committee, Compensation Committee and Governance Committee conducts an annual performance self-assessment with the purpose of increasing the effectiveness of our Board and its committees.
The following table describes the current members of each of the committees of our Board, and the number of meetings held during fiscal year 2023:
Director |
Board | Audit | Compensation | Governance | Executive | |||||||
Brandon B. Boze |
● |
|
● | ● | ● |
| ||||||
Beth F. Cobert |
● |
|
CHAIR |
|
|
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Reginald H. Gilyard |
● |
|
● | ● |
|
| ||||||
Shira D. Goodman |
LEAD INDEPENDENT DIRECTOR |
|
|
|
CHAIR |
| ||||||
E.M. Blake Hutcheson |
● | ● | ● |
|
|
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Christopher T. Jenny |
● |
|
|
CHAIR |
|
| ||||||
Gerardo I. Lopez |
● | CHAIR |
|
|
● |
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Susan Meaney |
● | ● |
|
● |
|
| ||||||
Guy A. Metcalfe |
● |
|
● | ● |
|
| ||||||
Oscar Munoz |
● | ● |
|
● |
|
| ||||||
Robert E. Sulentic |
CHAIR | ● | ||||||||||
Sanjiv Yajnik |
● | ● | ● | |||||||||
Number of Meetings |
7 | 9 | 5 | 4 | 0(1) |
(1) | Our Executive Committee did not hold any formal meetings in 2023, but acted four times by unanimous written consent. |
Board Attendance at Annual Meeting of Stockholders
Although the Board understands that there may be situations that prevent a director from attending an annual meeting of stockholders, it is the Board’s policy that all directors should attend these meetings. All of our then-serving directors attended our 2023 annual meeting of stockholders on May 17, 2023.
Independent Director Meetings
Our non-management directors meet in executive session without management present each time the full Board convenes for a regularly scheduled meeting. If our Board convenes for a special meeting, the non-management directors will meet in executive session if circumstances warrant. The lead independent director of our Board presides over executive sessions of non-management directors.
CBRE 2024 PROXY STATEMENT | CORPORATE GOVERNANCE — BOARD MEETINGS AND COMMITTEES | 15 |
Board Committees
Audit Committee | Chair: Gerardo I. Lopez* |
Members: E.M. Blake Hutcheson Susan Meaney Oscar Munoz* Sanjiv Yajnik* |
The Audit Committee provides oversight of our accounting and financial reporting and disclosure processes, the adequacy of the systems of disclosure and internal control established by management, our compliance with legal and regulatory requirements and the audit of our financial statements.
THE AUDIT COMMITTEE ALSO:
• | Retains, compensates, oversees and terminates the independent auditor and evaluates its qualifications, independence and performance; |
• | Pre-approves all audit and any non-audit services performed by the independent auditor; |
• | Reviews the results of the independent audit and internal audits as well as reports from our Chief Financial Officer, our Chief Accounting Officer, our Chief Ethics & Compliance Officer, our Head of Risk Management, our Head of Internal Audit, our Head of Financial Risk Management Compliance, our Chief Information Security Officer and our General Counsel; |
• | Reviews the independent auditor’s report describing our internal quality-control procedures and any material issues raised by the most recent internal quality-control review or any inquiry by governmental authorities; |
• | In consultation with the independent auditor, management and internal auditors, reviews the integrity of our internal and external financial reporting processes; |
• | Reviews financial statements and earnings releases and guidance provided to analysts and rating agencies; |
• | Reviews the Chief Ethics & Compliance Officer’s report on the effectiveness of our compliance with applicable ethical, legal, and regulatory requirements; |
• | Reviews our cybersecurity readiness and other policies and procedures related to data governance; |
• | Establishes procedures to handle complaints regarding accounting, internal controls or auditing matters; and |
• | Oversees the company’s major financial, cybersecurity and information technology risk exposures. |
All members of the Audit Committee are “financially literate” under NYSE listing standards.
* These three directors meet the SEC’s qualifications for an “audit committee financial expert.”
All members of the Audit Committee are independent within the meaning of SEC regulations, the listing standards of the NYSE and our Board’s Corporate Governance Guidelines, in each case, as such regulations, standards and guidelines apply to audit committee members.
Compensation Committee | Chair: Beth F. Cobert |
Members: Brandon B. Boze Reginald H. Gilyard E.M. Blake Hutcheson Guy A. Metcalfe Sanjiv Yajnik |
The Compensation Committee oversees the development and administration of our executive compensation policies, plans and programs, including reviewing and approving compensation of our executive officers and any compensation contracts or arrangements with our executive officers.
IN ADDITION, THE COMPENSATION COMMITTEE:
• | Reviews the performance of our executive officers, including our CEO; |
• | Retains its independent compensation consultant, Frederic W. Cook & Co., Inc., or FW Cook. FW Cook reports directly to the Committee, attends meetings and provides advice to the Committee; and |
• | Considers the results of annual stockholder advisory votes on the compensation of our named executive officers in connection with the discharge of its responsibilities. |
CBRE 2024 PROXY STATEMENT | CORPORATE GOVERNANCE — BOARD MEETINGS AND COMMITTEES | 16 |
Each Compensation Committee member qualifies as a “non-employee director” for purposes of the Securities Exchange Act of 1934, as amended, or the Exchange Act. All members are “independent” under NYSE listing standards applicable to compensation committee members. All members of the Compensation Committee are independent within the meaning of SEC regulations, the listing standards of the NYSE and our Board’s Corporate Governance Guidelines, in each case, as such regulations, standards and guidelines apply to compensation committee members.
Corporate Governance and Nominating Committee | Chair: Christopher T. Jenny |
Members: Brandon B. Boze Reginald H. Gilyard Susan Meaney Guy A. Metcalfe Oscar Munoz |
The Corporate Governance and Nominating Committee oversees our Board’s corporate governance procedures and practices, including:
• | Developing and recommending to our Board a set of corporate governance principles, including nomination criteria and independence standards; |
• | Recommendations of individuals for service on our Board; |
• | Recommendations to our Board regarding the size, composition, structure, operations, performance and effectiveness of the Board; |
• | Conducting an annual review of director compensation; |
• | Considering feedback obtained from shareholder outreach; and |
• | Overseeing annual Board, committee and individual director evaluations and self-assessments. |
All members are “independent” under NYSE listing standards and rules.
Executive Committee | Chair: Shira D. Goodman |
Members: Brandon B. Boze Gerardo I. Lopez Robert E. Sulentic
|
The Executive Committee implements policy decisions of our Board and is authorized to act on our Board’s behalf between meetings of our Board, including by approving certain transactions within dollar thresholds established by our Board.
The Executive Committee also engages in the periodic review of our balance sheet management, borrowings and capital markets activities.
Compensation Committee Interlocks and Insider Participation
None of Ms. Cobert, Messrs. Boze, Gilyard, Hutcheson, Metcalfe and Yajnik (all current members of the Compensation Committee) or Mr. Lopez (who served on the Compensation Committee for a portion of 2023) has ever been an officer or employee of the company or any of its subsidiaries. In addition, during 2023, none of our directors were employed as an executive officer of another entity where any of our executive officers served on that entity’s board of directors or compensation committee (or its equivalent).
CBRE 2024 PROXY STATEMENT | CORPORATE GOVERNANCE — SELECTED AREAS OF BOARD OVERSIGHT | 17 |
Selected Areas of Board Oversight
Oversight of Risk Management
The Board oversees risk management. | Full Board
Our Board regularly reviews information regarding our most significant strategic, operational, financial and compliance risks and is responsible for ensuring that the company has crisis management and business continuity plans in place to deal with potential crises. Our Board maintains direct oversight over our enterprise risk management process rather than delegating this function to a Board or management committee.
Although each committee is responsible for evaluating certain risks and overseeing the management of such risks, the entire Board is regularly informed through committee chair reports about such risks. These committee chair reports are presented at every regularly scheduled Board meeting. | |||||||
Company management is charged with managing risk through rigorous risk mitigation activities and strong internal controls. | Management
Our Executive Risk Committee is chaired by our Head of Risk Management and consists of senior executives representing a cross-section of our lines of business, operational areas and geographic regions. Our Executive Risk Committee is responsible for identifying and assessing our most significant risks. After this identification and assessment process, we assign each of our top risks to an executive-level (typically C-suite) risk owner, who is then charged with developing mitigation action plans which are then presented to the Executive Risk Committee.
Multiple times during the year, our Head of Risk Management provides a detailed presentation on identified significant risks to the Board or a committee of the Board. Certain risks that are determined to be best managed directly by the Board versus management or that are in areas specific to a particular Board committee expertise are monitored and overseen at the Board or committee level as appropriate. | |||||||
Board committees, which meet regularly and report back to the full Board, play significant roles in carrying out our Board’s risk oversight function. | The Audit Committee
oversees management of risks related to our financial reports and record-keeping and potential conflicts of interest. They also oversee our risk assessment and risk management processes more generally including major business, financial, information technology risks (including cybersecurity and data security risks), legal and reputational risk exposures, as well as risks related to crisis management and business continuity.
The Audit Committee receives regular reports from our Chief Financial Officer, our Chief Accounting Officer, our Chief Ethics & Compliance Officer, our Head of Risk Management, our Head of Internal Audit, our Head of Financial Risk Management Compliance, our Chief Information Security Officer as well as updates from our General Counsel on any developments affecting our overall risk profile and on issues of non-compliance and incident management. | |||||||
The Compensation Committee
is responsible for overseeing the management of risks relating to our compensation plans and arrangements. For additional information regarding the Compensation Committee’s assessment of our compensation-related risks, please see “Compensation Discussion and Analysis—Section 3. How We Make Compensation Decisions—Compensation Risk Assessment.” |
The Governance Committee
manages risks associated with corporate governance practices, investor engagement, Board independence and the composition of our Board and its committees. |
CBRE 2024 PROXY STATEMENT | CORPORATE GOVERNANCE — SELECTED AREAS OF BOARD OVERSIGHT | 18 |
Oversight of Strategy
Our Board is responsible for providing governance and oversight over the strategy, operations and management of our company. Each quarter, our Board and management devote a substantial amount of time in strategy-focused meetings discussing strategic issues that are most important to the company. At each regular Board meeting, our Board receives business and strategy updates from leaders across the company and reviews our operating plans and overall financial performance, and provides significant guidance and feedback. Annually, our Board reviews and approves our capital allocation and spending budgets, which are designed to strategically deploy capital intended to facilitate investments required to achieve operational excellence.
Oversight of Sustainability and Social Responsibility
As part of our Board’s strategic and risk oversight, our Board oversees our strategic planning and risk management policies and procedures related to sustainability and social responsibility. Our Board has made a deliberate decision to retain governance of these matters at the Board level. Our Board chose not to delegate these matters to a specific committee because it believes that these matters are integral to the company’s future success. Throughout the year, our Board receives reports and engages in discussions with management on key sustainability and social responsibility matters, including progress on sustainability services we provide to clients to meet their commercial real estate sustainability goals, the company’s diversity, equity and inclusion initiatives, and other efforts to be a responsible company in our communities. The Board also receives annual updates on how these risks are being addressed, mitigated and managed across the company, including sustainable development considerations that influence market, reputational, operational and political risks.
Oversight of Succession Planning
Our Board reviews management succession and development plans with the CEO on at least an annual basis, and as needed throughout the year. These plans include CEO succession in the event of an emergency or retirement, as well as the succession plans for the CEO’s direct reports and other employees critical to our continued operations and success.
CBRE 2024 PROXY STATEMENT | CORPORATE GOVERNANCE — SUSTAINABILITY AND SOCIAL RESPONSIBILITY | 19 |
Sustainability and Social Responsibility
We are determined to set the pace for our sector on sustainability and social responsibility. We recognize the impact we have on our communities, clients, employees and other stakeholders—and focus on initiatives that support our aspiration to grow our business responsibly and sustainably.
Our Chief Sustainability Officer oversees our corporate and client solutions sustainability initiatives, including accountability for progress toward our goal to achieve net zero carbon emissions by 2040. Our Chief Culture Officer, reporting directly to our Chief Executive Officer, oversees and drives progress on social impact and other initiatives, including our ethics and compliance; diversity, equity and inclusion; and community engagement.
We are pleased to receive various recognition for our performance, including rising to #3 on Barron’s 100 Most Sustainable Companies in the U.S. list in February 2024 (a list we have made for seven consecutive years), improving to an A- score on CDP’s climate change disclosure, and being named to 3BL’s 100 Best Corporate Citizens five years in a row.
Sustainability
As the world’s largest manager of commercial properties, we have an outsized opportunity and obligation to accelerate the decarbonization of the commercial real estate market at scale—through our own operations, for our clients and for the industry overall. Our Net Zero Roadmap for Corporate Operations outlines four pathways that will help us realize our goal of achieving net zero carbon emissions by 2040: Buildings, Energy, Transport and Procurement. Each pathway includes strategic objectives that are delivered through near-term actions and program-level strategies.
Our Commitment to Transparency
We are committed to providing transparent, meaningful sustainability information to stakeholders in accordance with the International Sustainability Standards Board’s (ISSB) reporting frameworks, including publishing SASB and TCFD disclosure in our CR Report since 2017 and 2019, respectively. In addition, our report was prepared in accordance with GRI Standards and we have participated in the UNGC and supported its Ten Principles since 2007.
Social Responsibility
People are at the center of our strategy to deliver measurably superior outcomes for clients, and we place a high priority on attracting, retaining and developing the best talent. We champion four key values—Respect, Integrity, Service, Excellence—which serve as the foundation upon which our company is built and as a touchstone for how our employees conduct themselves. Our programs are designed to help prepare our professionals to thrive in their current and future roles, develop our leaders of tomorrow, reward our people with competitive pay and benefits, foster an engaging and inclusive workplace, and improve productivity through investments in technology, tools and resources.
Commitment to Diversity, Equity and Inclusion (“DE&I”)
We believe our company is at its best when people of different backgrounds and life experiences come together to produce great results for our clients, communities and each other. Our strategic priorities include: strengthening an inclusive culture where everyone is valued and supported in achieving their full potential, increasing the diversity of our workforce and suppliers with whom we partner, and driving impact in the communities where we live and work.
We are committed to driving economic impact in the marketplace through our supplier diversity initiatives and spent nearly $2 billion to increase diversity among our suppliers in 2023, putting us on track to reach our goal of spending to $3.0 billion by the end of 2025. As part of our Community Impact Initiative, we made significant financial contributions to nonprofit organizations that are helping to improve education and career development opportunities for women, racial and ethnic minorities, people with disabilities, individuals who identify as LGBTQ+, and people with military service.
We publicly report demographics, including diversity data contained in our EEO-1 Submission, for our U.S. workforce in our CR Report.
Employee Engagement
Employee engagement is imperative because people are at the center of our strategy. As a services organization, our ability to engage our employees is critical in achieving our goals. Employee engagement is tied to several key organizational outcomes: employee retention; absenteeism and wellness; productivity; safety; client satisfaction and retention; revenue growth and stockholder returns.
In 2023, we partnered with an external vendor for the sixth time to conduct a worldwide employee engagement survey. CBRE’s “Your Voice” Employee Engagement Survey gave all employees an opportunity to provide confidential feedback about their work experiences. The 2023 survey had a response rate of 84% and again showed an increase in overall employee engagement, up from the previous year. We had top scores in areas of ethics & compliance; client focus; diversity, equity and inclusion; safety & wellness; supervision & management; and operating as a socially and environmentally responsible organization. Company leaders are committed to making further gains in these and other key areas through action plans based on employee feedback, and we plan to continue measuring our progress in future surveys.
CBRE 2024 PROXY STATEMENT | CORPORATE GOVERNANCE — SUSTAINABILITY AND SOCIAL RESPONSIBILITY | 20 |
Total Rewards and Wellbeing
We are committed to providing eligible employees with meaningful and affordable benefits while also ensuring our people experience a caring workplace culture that contributes to their wellbeing. We provide competitive total rewards programs in all the markets in which we operate, including fixed and variable pay, and comprehensive, company-specific benefits. Additionally, managers may implement flexible work arrangements, such as compressed work weeks and flextime, after considering several factors such as the nature of the employee’s work. We provide a variety of programs to support holistic physical and behavioral health, short and long-term financial stability, family planning and emotional resiliency for employees at any stage in their career. Our workplace wellbeing program provides employees with tools and resources to actively manage their wellbeing, including monthly workshops and online courses.
Learning and Development
We prioritize and invest in a range of learning and talent development programs that enable employees to thrive at CBRE and build their careers. To this end, we leverage a range of different learning approaches, including: webinars, live virtual and in-person training, self-paced digital learning, coaching, mentoring and on-the-job learning. To support inclusivity, we offer training programs in 32 languages.
Workplace Safety
We drive a culture where safety and wellbeing are integrated into business decisions. We insist on high global standards and leadership accountability, strong worker participation and competency, and best in class technology, supplier management and risk assessment programs. In 2023, we hosted our annual Global Safety and Wellbeing Week, themed “Be Safe. Be Well. Be Your Best Self,” to provide our employees with strategies that enable them to be safe and well at the end of every workday. Our employee engagement scores for safety are among the company’s top three scores. Finally, we continue to grow third-party certification of our management systems based on various International Organization for Standardization (ISO) requirements for occupational health and safety and risk management, as well as alignment with elements of ISO’s environmental and quality management standards.
Communities and Giving
At CBRE, we take a holistic approach to meeting the evolving needs of our communities and the people in them. Through our CBRE Cares programs, we encourage and support employees around the world to volunteer and donate to causes that are important to them. This includes activating fundraisers for large-scale disasters and humanitarian events with a corporate match, as well as providing support to our employees impacted by disasters. We also strategically invest in nonprofit programs focused on three main areas: driving climate action solutions, expanding the diverse workforce talent pool of tomorrow and improving communities in our global headquarters city of Dallas, Texas.
Public Policy & Political Participation
We prohibit the use of company funds for contributions to political candidates, political parties, or candidate campaigns and we do not have a political action committee. We recognize, however, that some laws might have a significant impact on the quality of services we offer to our clients, our employees in the workplace and the local communities we serve. Our legislative outreach and targeted lobbying activities focus on educating policymakers through data-driven research about the commercial real estate industry with the goal of helping legislators create fact-based, informed policy. We have retained professional lobbyists for local- and state-focused issues such as land use entitlement, business development, community relations, and state-level legislative and administrative rulemaking.
In 2023, we continued to improve our lobbyist tracking and compliance program in the U.S. to maintain a record of company-wide lobbying expenditures to enhance transparency and adhere to the highest ethical standards. Because of these efforts, we were recognized for being in the 90th percentile on the Center for Political Accountability Zicklin Index of Corporate Political Disclosure and Accountability.
CBRE 2024 PROXY STATEMENT | CORPORATE GOVERNANCE — STOCKHOLDER ENGAGEMENT | 21 |
Awards and Recognition
In 2023 and in early 2024, our ESG efforts were recognized with the following awards and accolades: | ||
• In 2023, we were listed on Forbes 2023 Net Zero Leaders list as the highest-ranked commercial real estate services company.
• In 2024, we secured an A- score from CDP on its climate change disclosure. CDP is considered the global standard for corporate transparency on climate impacts, risks and opportunities.
• In 2024, for the 11th consecutive year, we were named as one of the World’s Most Ethical Companies by Ethisphere, a global leader in defining and advancing the standards of ethical business practices.
• In 2024, we were listed #3 on Barron’s list of the 100 Most Sustainable Companies in the U.S. We have made the top 100 list for seven consecutive years. The 1,000 largest U.S. publicly held companies were considered for this recognition based on various environmental, social and governance performance indicators.
• In 2023, we were recognized by the Disability Equality Index as a Best Place to Work for Disability Inclusion and earned a top score.
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• We were included in the 3BL Media 100 Best Corporate Citizens list in 2023 for the fifth year in a row, which recognizes outstanding environmental, social and governance transparency and performance.
• We earned a place in the 2023 Bloomberg Gender-Equality Index (“GEI”) for the fourth straight year. The public companies in the Bloomberg GEI support gender equality through policy development, representation and transparency.
• We were named a Best Place to Work for LGBTQ+ Equality according to the Human Rights Campaign. CBRE received a perfect score on the 2023 Corporate Equality Index, a national benchmarking survey and report on corporate policies and practices related to LGBTQ+ workplace equality, for the tenth consecutive year.
• We received a 2024 EPA ENERGY STAR® Partner of the Year – Sustained Excellence Award, marking the 17th consecutive year of ENERGY STAR recognition.
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To learn more, please read our Corporate Responsibility Report at www.cbre.com/responsibility. The information contained on or available through this website is not a part of, or incorporated by reference into, this Proxy Statement.
Stockholder Engagement
We believe that engagement with our stockholders provide us with a valuable understanding of our stockholders’ perspectives and meaningful opportunities to share our views with them.
Throughout the year, management and members of our Board engage with a significant portion of our stockholders through a variety of forums. Our interactions cover a broad range of governance, financial and business topics. Stockholder feedback is regularly provided to the Board and the company’s management.
A brief description of our stockholder engagement efforts are outlined below.
How We Engage
• Quarterly earning calls
• Investor conferences
• Annual Shareholder Meeting
• Stockholder Outreach Program |
2023 Engagements
• As part of our stockholder outreach program, we extended invitations to institutional shareholders holding in the aggregate approximately 70% of our shares outstanding to discuss governance matters
• We met with shareholders representing approximately 30% of our shares outstanding
| |||
How We Communicate
• Annual Report
• Proxy Statement
• SEC filings
• Press releases
• Company website
• Corporate Responsibility Report |
2023 Engagement Topics
• Strategy and execution
• Board refreshment
• Board leadership structure
• Sustainability, human capital
• Compensation practices
• Stock retention policies
|
CBRE 2024 PROXY STATEMENT | CORPORATE GOVERNANCE — STOCKHOLDER ENGAGEMENT | 22 |
Communications with our Board
Stockholders and other interested parties may write to the Board Chair, Lead Independent Director, the entire Board or any of its members by:
Mail:
CBRE Group, Inc. c/o Chad Doellinger, Executive Vice President, General Counsel and Corporate Secretary 2100 McKinney Avenue, Suite 1250 Dallas, Texas 75201 |
Email:
to chad.doellinger@cbre.com. |
The Board considers stockholder questions and comments to be important and endeavors to respond promptly and appropriately, even though the Board may not be able to respond to all stockholder inquiries directly.
The Board has developed a process to assist with managing inquiries and communications. The General Counsel will review any stockholder communications and will forward to the Board Chair, Lead Independent Director, our Board or any of its members a summary and/or copies of any such correspondence that deals with the functions of our Board or committees thereof or that the General Counsel otherwise determines requires their attention. Certain circumstances may require that our Board depart from the procedures described above, such as the receipt of threatening letters or emails or voluminous inquiries with respect to the same subject matter.
CBRE 2024 PROXY STATEMENT | PROPOSAL 1: ELECT DIRECTORS — DIRECTOR NOMINATION CRITERIA | 23 |
Proposal 1:
Elect Directors
Our Board has nominated 11 directors for election at this Annual Meeting to hold office until the next annual meeting and the election of their successors. All of the nominees were selected to serve on our Board based the following criteria:
• | outstanding achievement in their professional careers; |
• | broad experience; |
• | personal and professional integrity; |
• | their ability to make independent, analytical inquiries; |
• | financial literacy; |
• | mature judgment; |
• | high-performance standards; |
• | familiarity with our business and industry; and |
• | an ability to work collegially. |
We believe that all of our director nominees have a reputation for honesty and adherence to high ethical standards. Each agreed to be named in this Proxy Statement and to serve if elected.
Director Nomination Criteria
Our Board seeks directors who represent a mix of backgrounds and experiences that will enhance the quality of our Board’s deliberations and decisions. In nominating candidates, our Board considers a diversified membership in the broadest sense, including multiple directors who are women and directors who identify in one or more of the following categories: racial, ethnic or national origin minorities, people with disabilities, LGBTQ+, and military/veterans. Our Board does not discriminate on the basis of race, color, national origin, gender, religion, disability or sexual orientation or any other category protected by law. When evaluating candidates, our Board considers whether potential nominees possess integrity, accountability, informed judgment, financial literacy, mature confidence and high-performance standards.
Our Board is especially interested in adding candidates over time who are operating executives (particularly current chief executives or other operating executives of other large public companies) or who have a strong technology background and in both cases a passion for building a transformative business on a global basis. Other factors include having directors with international experience, including knowledge of emerging markets or management of business operations and resources that are dispersed across a global platform.
Director Independence
A majority of our Board must be independent under our Corporate Governance Guidelines and New York Stock Exchange (NYSE) listing standards. Also, at least one member of our Audit Committee should have the qualifications and skills necessary to be considered an “Audit Committee Financial Expert” under Section 407 of the Sarbanes-Oxley Act, as defined by the rules of the Securities and Exchange Commission, or SEC.
Director Term Limits
Under our by-laws, our Board may not nominate any non-management director for re-election to the Board if that director has completed 12 years of service as an independent member of the Board on or prior to the date of election to which such nomination relates. No exemptions are permitted. Our Board believes that these restrictions contribute to Board stability, vitality and diversity and help ensure that our Board continuously benefits from a balanced mix of perspectives and experiences.
CBRE 2024 PROXY STATEMENT | PROPOSAL 1: ELECT DIRECTORS — DIRECTOR NOMINATION CRITERIA | 24 |
Director Service on Other Public Company Boards
Our Board recognizes that service on other public company boards provides directors valuable experience that benefits the company. Our Board also believes, however, that it is critical that directors dedicate sufficient time to their service on the company’s Board. Directors are expected to advise the chair of the Corporate Governance and Nominating Committee of our Board, or the Governance Committee, in advance of accepting an invitation to serve on another board of directors. This allows the Governance Committee to evaluate the impact of the director joining another board based on various factors relevant to the specific situation, including the nature and extent of a director’s other professional obligations, potential conflicts of interest and the time commitment required by the new position.
Our Corporate Governance Guidelines provide that:
• | Directors who are public company executive officers may sit on no more than two public company boards (including the company’s Board); and |
• | Directors that are not public company executive officers may sit on no more than five public company boards (including the company’s Board), or to the extent such director is the chair or lead independent director of a public company board, then no more than four public company boards (including the company’s Board). |
The Governance Committee also takes into consideration the nature of and time involved in a director’s service on other boards (including public company leadership roles) and other outside commitments when evaluating the suitability of individual directors. The Governance Committee conducts an annual review of director commitment levels, and affirms that all of our director nominees are compliant with company’s overboarding policy.
Director Resignation Policy Upon Change of Employment
Our Board’s Corporate Governance Guidelines require that directors tender their resignation upon a change of their employment. The Governance Committee will then consider whether the change in employment has any bearing on the director’s ability to serve on our Board, our Board’s goals regarding Board composition or any other factors considered appropriate and relevant. Our Board will then determine whether to accept or reject the tendered resignation.
Majority Voting to Elect Directors
In uncontested elections, directors are elected by a “majority vote” requirement. Under this requirement, in order for a nominee to be elected in an uncontested election, the nominee must receive the affirmative vote of a majority of the votes cast in his or her election (i.e., votes cast “FOR” a nominee must exceed votes cast as “AGAINST”). Votes to “ABSTAIN” with respect to a nominee and broker non-votes are not considered votes cast, and so will not affect the outcome of the nominee’s election. The company maintains a plurality vote standard in contested director elections, where the number of nominees exceeds the number of directors to be elected.
If an incumbent director in an uncontested election does not receive a majority of votes cast for such incumbent’s election, the director is required to submit a letter of resignation to the Board for consideration by the Governance Committee. The Governance Committee is required to promptly assess the appropriateness of such nominee continuing to serve as a director and recommend to the Board the action to be taken with respect to the tendered resignation. The Board will act on the Governance Committee’s recommendation within 90 days of the date of the certification of election results.
Required Vote
This is an uncontested Board election. In order to be elected, each nominee must receive the affirmative vote of a majority of the votes cast on his or her election (i.e., votes cast “FOR” a nominee must exceed votes cast as “AGAINST”). Votes to “ABSTAIN” with respect to a nominee and broker non-votes are not considered votes cast, and so will not affect the outcome of the nominee’s election.
CBRE 2024 PROXY STATEMENT | PROPOSAL 1: ELECT DIRECTORS — DIRECTOR NOMINATION PROCESS | 25 |
Director Nomination Process
The Governance Committee is responsible for identifying and evaluating potential candidates and recommending candidates to our Board for nomination. They also perform assessments of the skills and experiences needed to properly oversee our interests.
The Governance Committee regularly reviews the composition of our Board and determines whether the addition of directors with particular experience, skills or characteristics would make our Board more effective. When a need arises to fill a vacancy, or it is determined that a director possessing particular experiences, skills or characteristics would make our Board more effective, the Governance Committee conducts targeted efforts to identify and recruit individuals who have the necessary qualifications.
As a part of the search process, the Governance Committee:
• Will actively seek out women and underrepresented candidates;
• May consult with other directors and members of our senior management; and
• May also hire a search firm to assist in identifying and evaluating potential candidates. | ||||
All potential candidates are interviewed by our CEO, our Lead Independent Director, our Governance Committee Chair and, to the extent practicable, the other members of the Governance Committee, and may be interviewed by other directors and members of senior management as desired and as schedules permit.
| ||||
The General Counsel:
• Reviews a director questionnaire submitted by the candidate; and
• Conducts a background and reference check as appropriate.
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The Governance Committee narrows down the list of final candidates.
The final candidates are interviewed by all remaining directors as schedules permit.
The Governance Committee meets to consider the final candidates and makes its recommendation to the Board to nominate or appoint the new director.
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The selection process for candidates is intended to be flexible, and the Governance Committee, in the exercise of its discretion, may deviate from the selection process when particular circumstances so warrant. The Governance Committee will also consider candidates recommended to our Board by our stockholders. See “Stockholder Recommendations of Director Candidates” in this Proxy Statement for more information.
CBRE 2024 PROXY STATEMENT | PROPOSAL 1: ELECT DIRECTORS — DIRECTOR NOMINATION PROCESS | 26 |
Director Nominee Skills and Experience Matrix
Our director nominees bring a well-rounded variety of experiences, qualifications, attributes and skills, and represent a mix of deep knowledge of the company and fresh perspectives. The director nominee skills and experience matrix below summarizes some of the key attributes that our Board has identified as particularly valuable to the effective oversight of our company and the execution of our corporate strategy. This director nominee skills and experience matrix is not intended to be an exhaustive list of each of our director nominees’ skills or contributions to the Board. Further information on each director nominee, including some of their specific experience, qualifications, attributes and skills is included in the biographies on pages 29 to 34 of this Proxy Statement.
Skill |
Boze | Cobert | Gilyard | Goodman | Hutcheson | Jenny | Lopez | Metcalfe | Munoz | Sulentic | Yajnik | |||||||||||||
Cybersecurity |
● | ● | ● | |||||||||||||||||||||
Finance and Accounting |
● | ● | ● | ● | ● | ● | ● | ● | ● | ● | ||||||||||||||
Global Business Operations |
● | ● | ● | ● | ● | ● | ● | ● | ● | ● | ● | |||||||||||||
Human Capital Management |
● | ● | ● | ● | ● | ● | ● | ● | ● | ● | ● | |||||||||||||
M&A |
● | ● | ● | ● | ● | ● | ● | ● | ● | ● | ● | |||||||||||||
Other Public Company Board Service |
● | ● | ● | ● | ● | ● | ● | ● | ● | |||||||||||||||
Real Estate Industry Experience |
● | ● | ● | ● | ● | ● | ● | ● | ● | |||||||||||||||
Risk Management |
● | ● | ● | ● | ● | ● | ● | ● | ● | ● | ● | |||||||||||||
Senior Leadership/CEO |
● | ● | ● | ● | ● | ● | ● | ● | ● | ● | ||||||||||||||
Sustainability |
● | ● | ● | ● | ● | ● | ● | |||||||||||||||||
Technology and Innovation |
● | ● | ● | ● | ● | ● | ● | |||||||||||||||||
Demographic Background |
||||||||||||||||||||||||
Board Tenure (Years) |
11 | 7 | 5 | 5 | 1 | 8 | 8 | <1 | 3 | 11 | 6 | |||||||||||||
Age |
43 | 65 | 60 | 63 | 63 | 68 | 64 | 56 | 65 | 67 | 67 | |||||||||||||
Gender |
M | F | M | F | M | M | M | M | M | M | M | |||||||||||||
Race/Ethnicity |
||||||||||||||||||||||||
Asian |
● | |||||||||||||||||||||||
Black/African American |
● | |||||||||||||||||||||||
Hispanic/Latino |
● | ● | ||||||||||||||||||||||
White/Caucasian |
● | ● | ● | ● | ● | ● | ● |
CBRE 2024 PROXY STATEMENT | PROPOSAL 1: ELECT DIRECTORS — DIRECTOR NOMINATION PROCESS | 27 |
Skills and Experience Definitions
Cybersecurity
Experience in the development of technology and processes that protect the storage of information and maintain confidentiality.
Finance and Accounting
High-level expertise in finance and accounting, gained through (i) experience as an operating executive with responsibility for all or a portion of a company’s financial reporting, (ii) experience in the financial sector or private equity or as an audit committee member for publicly traded companies, or (iii) an educational background or training in accounting or finance.
Global Business Operations
International experience, including knowledge of emerging markets or management of business operations and resources that are dispersed across a global platform.
Human Capital Management
Experience and expertise related to human resource issues such as attracting and retaining talent, succession planning, engagement of employees, and the development and evolution of culture, including the alignment of culture and long-term strategy.
M&A
Experience overseeing investment capital decisions, strategic investments and mergers and acquisitions.
Other Public Company Board Service
Experience serving on the boards of other public companies.
Real Estate Industry Experience
Deep commercial real estate operating and investment experience.
Risk Management
Experience assessing risk and reviewing measures to address and mitigate material risks.
Senior Leadership/CEO
Experience serving in senior leadership roles at a large organization.
Sustainability
Experience in sustainability initiatives and practices.
Technology and Innovation
Experience in technology-related business, technological functions or experience implementing innovative technological business strategies, as well as an understanding of emerging technology trends.
Board Diversity
Our director nominees are 55% diverse, with four ethnically diverse directors and two female directors.
Our Board seeks directors who represent a mix of backgrounds and experiences that will enhance the quality of our Board’s deliberations and decisions. In nominating candidates, our Board considers a diversified membership in the broadest sense, including multiple directors who are women and directors who identify in one or more of the following categories: racial, ethnic or national origin minorities, people with disabilities, LGBTQ+, military/veterans.
In February 2024, our Board successfully on-boarded Guy A. Metcalfe to the Board. Mr. Metcalfe is one of the premier strategic advisors in the real estate industry, with extensive transactional and commercial real estate experience. We believe that our Board will be greatly enhanced by his deep knowledge of and broad perspective on our sector. In addition to leading Morgan Stanley’s real estate banking business for over two decades, Mr. Metcalfe has a deep understanding of our business, and has served as a trusted strategic advisor to our company and has helped us consummate notable capital-raising, mergers and acquisitions and capital markets transactions.
We are committed to board diversity. Although the percentage of women on our Board is currently below 30%, we expect that percentage to increase in the future through our board refreshment process. Pursuant to our Corporate Governance Guidelines, as part of the search process for a new director, the Governance Committee will actively seek out women and underrepresented candidates to include in the pool from which Board nominees are chosen and will instruct any search firm engaged for the search to provide a set of candidates that includes both underrepresented people of color and different genders.
CBRE 2024 PROXY STATEMENT | PROPOSAL 1: ELECT DIRECTORS — OUR 2024 DIRECTOR NOMINEES | 28 |
Our 2024 director nominees reflect our Board’s deliberate efforts over time to diversify the membership of our Board. Of our 11 director nominees:
Our 2024 Director Nominees
For our upcoming annual meeting, the Board recommends the election of each nominee as a director. Each nominee has informed the Board that he or she is willing to serve as a director.
A brief biography summarizing the background and qualifications of each director nominee is provided on the following pages.
|
The Board of Directors recommends a vote “FOR” the election of each of the following 2024 Director Nominees for a one-year term. |
CBRE 2024 PROXY STATEMENT | PROPOSAL 1: ELECT DIRECTORS — OUR 2024 DIRECTOR NOMINEES | 29 |
Brandon B. Boze | ||||
Age: 43 Director Since: December 2012 Independent
|
Board Committees: • Compensation • Governance • Executive | |||
Skills & Experience • Finance and Accounting • Global Business Operations • Human Capital Management • M&A • Other Public Company Board Service • Real Estate Industry Experience • Risk Management • Senior Leadership/CEO • Sustainability • Technology and Innovation |
Qualifications Mr. Boze served as the Independent Chair of our Board from May 2018 to November 2023. He served as the President, a Partner and a member of the Management Committee of ValueAct Capital, a privately owned investment firm from August 2005 to January 2024.
Prior to joining ValueAct Capital, Mr. Boze was an investment banker at Lehman Brothers, focused on power utilities and technology mergers and acquisitions.
Mr. Boze brings to our Board experience in finance, strategy, mergers and acquisitions, and investments.
He previously served on the board of directors of Trinity Industries, Inc. and Valeant Pharmaceuticals International.
Mr. Boze holds a B.E. from Vanderbilt University and is a CFA charterholder.
Other Public Company Boards • None.
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Beth F. Cobert |
||||
Age: 65 Director Since: May 2017 Independent
|
Board Committee: • Compensation (Chair) | |||
Skills & Experience • Cyber Security • Finance and Accounting • Global Business Operations • Human Capital Management • M&A • Real Estate Industry Experience • Risk Management • Senior Leadership/CEO • Technology and Innovation |
Qualifications Ms. Cobert served as the President of the Markle Foundation from September 2023 to February 2024, where she led Markle’s Rework America Alliance, a partnership of civil rights organizations, non-profits, private sector employers, labor unions, educators, and others working to open opportunities for millions of people from low-pay roles to move into good jobs with opportunities for career advancement. She previously served as the Acting President of the Markle Foundation from September 2022 to September 2023 and its Chief Operating Officer from July 2020 to September 2022. Ms. Cobert also led Markle’s Skillful initiative as Chief Executive Officer from June 2017 to July 2021.
She previously served as the Acting Director of the U.S. Office of Personnel Management from July 2015 to January 2017, and as the Deputy Director for Management of the U.S. Office of Management and Budget from October 2013 to July 2015. From 2001 to October 2013, Ms. Cobert served as a Senior Partner at McKinsey & Company, a global business strategy consulting firm. From 1990 to 2001, Ms. Cobert was a Partner at McKinsey & Company. She joined the firm in 1984 as an Associate and served in various leadership roles at McKinsey & Company.
Ms. Cobert brings to our Board over 35 years of experience as a consultant in business strategy, where she worked with corporate, non-profit and government entities on key strategic, operational and organizational issues across a range of sectors, including financial services, health care, legal services, real estate and telecommunications. Our Board also benefits from Ms. Cobert’s government service.
Ms. Cobert serves on the Board of Trustees of Princeton University and a business member on the Colorado Workforce Development Council. She previously served as a member of the board of directors and chair of the United Way of the Bay Area and as a member of the Stanford University Graduate School of Business Advisory Council.
Ms. Cobert holds a B.A. from Princeton University and an M.B.A. from Stanford University.
Other Public Company Boards • None.
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CBRE 2024 PROXY STATEMENT | PROPOSAL 1: ELECT DIRECTORS — OUR 2024 DIRECTOR NOMINEES | 30 |
Reginald H. Gilyard | ||||
Age: 60 Director Since: November 2018 Independent
|
Board Committees: • Compensation • Governance | |||
Skills & Experience • Global Business Operations • Human Capital Management • M&A • Other Public Company Board Service • Real Estate Industry Experience • Risk Management • Technology and Innovation |
Qualifications Mr. Gilyard has served as a Senior Advisor to The Boston Consulting Group, Inc. (BCG), a global management consulting firm, since August 2017. Prior to this role, Mr. Gilyard served as the Dean of the Argyros School of Business and Economics at Chapman University from August 2012 to July 2017. Prior to joining Chapman University, Mr. Gilyard served as Partner and Managing Director at BCG, where he led strategy, M&A and business transformation initiatives for large corporations, from 1996 to 2012. Prior to BCG, he served nine years in the U.S. Air Force and three years in the U.S. Air Force Reserves, rising to Major in the Reserves.
Mr. Gilyard brings to our Board more than 25 years of experience developing and implementing successful strategies for Fortune 500 companies, educational institutions and large national foundations.
He serves on the board of directors of First American Financial Corporation, Orion Office REIT Inc. and Realty Income Corporation. He also serves as a member of the board of directors of Pacific Charter School Development, a real estate development company serving low income families in urban centers across the country.
Mr. Gilyard holds a B.S. from the United States Air Force Academy, an M.S. from the United States Air Force Institute of Technology and an M.B.A. from Harvard Business School.
Other Public Company Boards • First American Financial Corporation • Orion Office REIT Inc. • Realty Income Corporation
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Shira D. Goodman | ||||
Age: 63 Director Since: May 2019 Lead Independent Director
|
Board Committee: • Executive (Chair) | |||
Skills & Experience • Finance and Accounting • Global Business Operations • Human Capital Management • M&A • Other Public Company Board Service • Risk Management • Senior Leadership/CEO • Sustainability |
Qualifications Ms. Goodman has served as an Advisory Director to Charlesbank Capital Partners, a private equity firm, since January 2019. She previously served as the Chief Executive Officer of Staples, Inc. from September 2016 to January 2018. Ms. Goodman served in roles with increasing responsibility at Staples since joining Staples in 1992, including President and Interim Chief Executive Officer from June 2016 to September 2016, President, North American Operations from January 2016 to June 2016, and President, North American Commercial from February 2014 to June 2016.
Prior to that, she served as Executive Vice President of Global Growth from February 2012 to February 2014, Executive Vice President of Human Resources from March 2009 to February 2012, Executive Vice President of Marketing from May 2001 to March 2009, and in various other management positions. Prior to Staples, Ms. Goodman worked at Bain & Company from 1986 to 1992, in project design, client relationships and case team management.
Ms. Goodman brings to our Board more than 25 years of experience in business operations, marketing, sales force management, human resources, business growth and distribution logistics.
She serves on the board of directors of CarMax, Inc. and previously served on the board of directors of Henry Schein, Inc., Staples, Inc. and The Stride Rite Corporation.
Ms. Goodman holds a B.A. from Princeton University, an M.S. in Management from the Massachusetts Institute of Technology and a J.D. from Harvard University.
Other Public Company Boards • CarMax, Inc.
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CBRE 2024 PROXY STATEMENT | PROPOSAL 1: ELECT DIRECTORS — OUR 2024 DIRECTOR NOMINEES | 31 |
E.M. Blake Hutcheson | ||||
Age: 63 Director Since: September 2022 Independent
|
Board Committees: • Audit • Compensation | |||
Skills & Experience • Finance and Accounting • Global Business Operations • Human Capital Management • M&A • Other Public Company Board Service • Real Estate Industry Experience • Risk Management • Senior Leadership/CEO • Sustainability |
Qualifications Mr. Hutcheson has served as the President and CEO of OMERS, one of Canada’s largest defined-benefit pension plans, since June 2020. He earlier served as President and Chief Pension Officer of OMERS from April 2018 to May 2020 and President and CEO of Oxford Properties Group, a wholly owned subsidiary of OMERS focused on global real estate investments and developments, from January 2010 to June 2018. He also served as Chief Investment Officer, Real Estate and Strategic Investments for OMERS during that period.
Prior to OMERS, Mr. Hutcheson was the Head of Global Real Estate with Mount Kellett Capital Management, a global private equity firm. Before that, Mr. Hutcheson spent 14 years with CBRE Canada, serving in roles of increasing responsibility, including as Senior Vice President and Executive Vice President, Chief Operating Officer, and Chair and President. He also served as Chair and President of CBRE’s Latin America operations.
Mr. Hutcheson brings to our Board over 30 years of significant commercial real estate operating and investment experience. Mr. Hutcheson serves as a member of the board of directors of Algoma Central Corporation, a TSX-listed owner/operator of transport vehicles.
He holds a B.A. from the University of Western Ontario, a M.S in Real Estate Development from Columbia University (Distinguished Alumnae Award) and a Graduate Diploma (with distinction) in International and Comparative Politics from the London School of Economics. He recently received the Order of Ontario which is his Province’s highest civilian honor for his contribution to Ontario and Canada.
Other Public Company Boards • Algoma Central Corporation
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Christopher T. Jenny | ||||
Age: 68 Director Since: January 2016 Independent
|
Board Committee: • Governance (Chair) | |||
Skills & Experience • Finance and Accounting • Global Business Operations • Human Capital Management • M&A • Other Public Company Board Service • Real Estate Industry Experience • Risk Management • Senior Leadership/CEO |
Qualifications Mr. Jenny has served as the Chief Executive Officer of Jennus Innovation, a business development incubator/accelerator, since February 2021 and as its Chair since January 2018. He previously served as a Senior Advisor to EY-Parthenon, a global strategy consulting organization, from January 2016 to December 2018 and as a Senior Managing Director from August 2014 to December 2015. He previously served as President and Senior Partner with The Parthenon Group LLC, a Boston-based private management consulting firm, from 1995 to 2014 prior to its merger with Ernst & Young in August 2014. Prior to joining The Parthenon Group LLC in 1995, Mr. Jenny was a Partner at Bain & Company, Inc., a global business strategy consulting firm.
Mr. Jenny brings to our Board more than 30 years of experience as a consultant in business strategy, and has worked on issues related to business-unit strategy, profit improvement and mergers and acquisitions. He has experience as a senior operating executive and has managed portfolio companies for two of the nation’s leading private-equity firms.
He is a member of the board of directors of Jennus Innovation, The Guardian Life Insurance Company of America, Mobile Virtual Player, FAIRWAYiQ and PLT4M. He previously served on the board of directors of Mac-Gray Corporation.
Mr. Jenny holds a B.A. from Dartmouth College and an M.B.A. from Harvard Business School.
Other Public Company Boards • None.
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CBRE 2024 PROXY STATEMENT | PROPOSAL 1: ELECT DIRECTORS — OUR 2024 DIRECTOR NOMINEES | 32 |
Gerardo I. Lopez | ||||
Age: 64 Director Since: October 2015 Independent
|
Board Committees: • Audit (Chair) • Executive | |||
Skills & Experience • Finance and Accounting • Global Business Operations • Human Capital Management • M&A • Other Public Company Board Service • Real Estate Industry Experience • Risk Management • Senior Leadership/CEO • Sustainability • Technology and Innovation |
Qualifications Mr. Lopez served as an Executive-in-Residence at Softbank Investment Advisers, Inc. from October 2021 to October 2022 and previously served as an Operating Partner and Head of its Operating Group from December 2018 to October 2021. Prior to Softbank, he served as an Operating Partner at High Bluff Capital from June 2018 to December 2018. From January 2018 to March 2018, Mr. Lopez served as a Senior Advisor to Extended Stay America, Inc. and its paired-share REIT, ESH Hospitality, Inc. and was its President and Chief Executive Officer from August 2015 to December 2017. Mr. Lopez previously served as President and Chief Executive Officer of AMC Entertainment Holdings, Inc. and its subsidiary, AMC Entertainment Inc., from March 2009 through August 2015. Prior to that, he was Executive Vice President of Starbucks Coffee Company and President of its Global Consumer Products, Seattle’s Best Coffee and Foodservice divisions from September 2004 to March 2009, and President of the Handleman Entertainment Resources division of Handleman Company from November 2001 to September 2004. Mr. Lopez has also held a variety of executive management positions with International Home Foods, Frito Lay, Pepsi-Cola and the Procter & Gamble Company.
Mr. Lopez brings to our Board his skills, knowledge and business leadership as a senior executive at hospitality, entertainment and consumer products companies. He has over 35 years of experience in marketing, sales and operations and management in public and private companies and has public company experience across diverse consumer-focused industries.
He serves on the board of directors of Newell Brands and Realty Income Corporation, and previously served on the board of directors of Brinker International, Inc., Extended Stay America, Inc., AMC Entertainment Holdings, Inc., Digital Cinema Implementation Partners, National Cinemedia, LLC, Open Road Films, Safeco Insurance, TXU, Inc. and Recreational Equipment, Inc.
Mr. Lopez holds a B.A. from George Washington University and an M.B.A. from Harvard Business School.
Other Public Company Boards • Newell Brands • Realty Income Corporation
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CBRE 2024 PROXY STATEMENT | PROPOSAL 1: ELECT DIRECTORS — OUR 2024 DIRECTOR NOMINEES | 33 |
Guy A. Metcalfe | ||||
Age: 56 Director Since: February 2024 Independent
|
Board Committees: • Compensation • Governance | |||
Skills & Experience • Finance and Accounting • Global Business Operations • Human Capital Management • M&A • Other Public Company Board Service • Real Estate Industry Experience • Risk Management • Senior Leadership/CEO |
Qualifications Mr. Metcalfe was a Managing Director, member of the Investment Banking Executive Committee and Global Chairman of Real Estate at Morgan Stanley, until his retirement in January 2024. He led Morgan Stanley’s real estate investment banking business for over two decades.
Mr. Metcalfe brings to our Board extensive transactional and commercial real estate experience. Over the years, he has served as a trusted strategic advisor to CBRE and has been involved in notable capital-raising, M&A and capital markets transactions for the company. In addition, he has facilitated some of the most transformational transactions in the real estate industry.
Mr. Metcalfe serves as a member of the board of directors of RioCan Real Estate Investment Trust, one of Canada’s largest real estate investment trusts. He also serves on the Board of Directors of nonprofits, including the Child Mind Institute, and has been an advisor on real estate matters to the Partnership Fund for New York City.
Mr. Metcalfe holds a B.A. in Business Administration (honors) from the Ivey Business School at the University of Western Ontario.
Other Public Company Boards • RioCan Real Estate Investment Trust
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Oscar Munoz | ||||
Age: 65 Director Since: November 2020 Independent
|
Board Committees: • Audit • Governance | |||
Skills & Experience • Finance and Accounting • Global Business Operations • Human Capital Management • M&A • Other Public Company Board Service • Risk Management • Senior Leadership/CEO • Sustainability • Technology and Innovation |
Qualifications Mr. Munoz served as the Executive Chair to United Airlines Holdings, Inc. from May 2020 to May 2021, its Chief Executive Officer from September 2015 to May 2020 and President from September 2015 to August 2016. Prior to United, Mr. Munoz served as the President and Chief Operating Officer of CSX Corporation, a railroad and intermodal transportation services company, from February 2015 to September 2015, as Executive Vice President and Chief Operating Officer of CSX from 2012 to 2015, and as Executive Vice President and Chief Financial Officer of CSX from 2003 to 2012.
Mr. Munoz brings to our Board his skills, knowledge and business leadership as a senior executive in various financial and strategic capacities at some of the world’s most recognized consumer brands. He has over 30 years of experience in management, finance, accounting and auditing, and has held key executive positions within the telecommunications, beverage and transportation industries.
He is a member of the board of directors of Archer Aviation, Inc., Salesforce, Inc. and Univision Holdings, Inc. Mr. Munoz also serves on the board of trustees of Fidelity Investments, the University of Southern California and The Brookings Institution. He previously served on the board of directors of Continental Airlines, Inc., CSX Corporation and United Airlines Holdings, Inc.
Mr. Munoz holds a B.S. in business administration from the University of Southern California and an M.B.A. from Pepperdine University.
Other Public Company Boards • Archer Aviation, Inc. • Salesforce, Inc.
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CBRE 2024 PROXY STATEMENT | PROPOSAL 1: ELECT DIRECTORS — OUR 2024 DIRECTOR NOMINEES | 34 |
Robert E. Sulentic | ||||
Age: 67 Director Since: December 2012 Board Chair
|
Board Committee: • Executive | |||
Skills & Experience • Cyber Security • Finance and Accounting • Global Business Operations • Human Capital Management • M&A • Other Public Company Board Service • Real Estate Industry Experience • Risk Management • Senior Leadership/CEO • Sustainability • Technology and Innovation |
Qualifications Mr. Sulentic has been our President and CEO since December 2012. He assumed additional responsibilities as Board Chair in November 2023. Previously, he served in several senior leadership roles, including Group President with responsibility for Asia Pacific, EMEA and the Development Services business; Chief Financial Officer; and President with responsibility for all business segments. At Trammell Crow Company, which CBRE acquired in December 2006, Mr. Sulentic served as Chief Financial Officer, Chief Executive Officer and Board Chair.
This deep and varied background enables Mr. Sulentic to bring significant strategic, financial and operating skills to our Board.
Mr. Sulentic previously served on the following public company boards: CBRE Acquisition Holdings, Inc. (Board Chair), which merged with Altus Power, Inc. (NYSE:AMPS); Staples, Inc. (Independent Board Chair) and Trammell Crow Company (Board Chair).
Mr. Sulentic holds a B.A. from Iowa State University and an M.B.A. from Harvard Business School.
Other Public Company Boards • None.
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Sanjiv Yajnik | ||||
Age: 67 Director Since: November 2017 Independent
|
Board Committees: • Audit • Compensation | |||
Skills & Experience • Cyber Security • Finance and Accounting • Global Business Operations • Human Capital Management • M&A • Real Estate Industry Experience • Risk Management • Senior Leadership/CEO • Sustainability • Technology and Innovation |
Qualifications Mr. Yajnik has been the President of Capital One Financial Services, a division of Capital One, since June 2009. He also serves on Capital One’s Executive Committee. In addition, Mr. Yajnik oversees Capital One’s community relations throughout Texas, Oklahoma and Louisiana as President of the company’s South-Central Region. Since joining Capital One in 1998, he has held a number of senior leadership positions in Europe, Canada and the United States.
Prior to Capital One, he held leadership positions at PepsiCo and Circuit City and was a Chief Engineer for Mobil Oil Corporation’s shipping business.
He is a member of the board of directors of Khan Academy, serves as the Chair of the Collin County Business Alliance, Co-Chair of the Indian American CEO (IACEO) Council and is a member of the executive board of the Dallas Symphony Association. Mr. Yajnik previously served as Chair of the Dallas Symphony Association and Texas Economic Development Corporation.
Mr. Yajnik brings to our board his broad business background and his experience in leading the transformation of a large, service-oriented global organization through technology enablement.
Mr. Yajnik received an M.B.A. with honors from the University of Western Ontario, Canada, and completed the Executive Management Program at Stanford University. He is a medalist Chartered Engineer (I), and graduated with distinction from the Marine Engineering Research Institute, India.
Other Public Company Boards • None.
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Susan Meaney will not stand for re-election in order to pursue other opportunities. We greatly appreciate her service and invaluable contributions to CBRE. |
CBRE 2024 PROXY STATEMENT | PROPOSAL 1: ELECT DIRECTORS — DIRECTOR COMPENSATION | 35 |
Director Compensation
2023 Director Compensation Policy
Our 2023 director compensation policy provides for the following annual compensation for each of our non-employee directors:
BOARD RETAINER | $110,000 in cash, payable upon commencement of director’s annual term. | |
RESTRICTED STOCK UNIT GRANT | $220,000, granted on the date of the Annual Meeting and vesting on the earlier of the one-year anniversary of grant or the next annual meeting. | |
ADDITIONAL COMPENSATION FOR LEAD INDEPENDENT DIRECTOR AND COMMITTEE CHAIRS | Payable in cash upon commencement of director’s annual term | |
Lead Independent Director Retainer | $75,000 | |
Audit Committee Chair Retainer | $30,000 | |
Compensation Committee Chair Retainer | $25,000 | |
Governance Committee Chair Retainer | $20,000 |
Our non-employee directors may elect to receive shares of our common stock in lieu of cash payments (in like amounts). Non-employee directors who are appointed or elected off-cycle (i.e., outside an annual meeting) receive a pro rata portion of their cash retainer and restricted stock unit grant based on the length of their service until the next annual meeting.
Our non-employee directors are eligible to defer their compensation through our Deferred Compensation Plan, as described under “Executive Compensation—Summary of Plans, Programs and Agreements—Deferred Compensation Plan.” We also reimburse our non-employee directors for all reasonable out-of-pocket expenses incurred in the performance of their duties as directors.
Employee directors do not receive any fees for attendance at meetings or for their service on our Board.
2023 Director Compensation
The following table provides information regarding compensation earned during the fiscal year ended December 31, 2023 by each non-employee director for his or her Board and committee service. For stock awards in the table below, the dollar amounts indicated reflect the aggregate grant date fair value for awards granted during the fiscal year ended December 31, 2023.
Robert E. Sulentic, who is our Chair, President and Chief Executive Officer, is not compensated for his role as a director.
Name |
Fees Earned or Paid in Cash(1) ($) |
Stock Awards(2)(3) ($) |
Change in Pension Value and Nonqualified Deferred Compensation Earnings ($) |
Total ($) |
||||||||||||
Brandon B. Boze |
110,000 | 219,976 | — | 329,976 | ||||||||||||
Beth F. Cobert |
135,000 | 219,976 | — | 354,976 | ||||||||||||
Reginald H. Gilyard |
110,000 | 219,976 | — | 329,976 | ||||||||||||
Shira D. Goodman(4) |
162,925 | 219,976 | — | 382,901 | ||||||||||||
E.M. Blake Hutcheson |
110,000 | 219,976 | — | 329,976 | ||||||||||||
Christopher T. Jenny |
130,000 | 219,976 | — | 349,976 | ||||||||||||
Gerardo I. Lopez(5) |
125,283 | 219,976 | — | 345,259 | ||||||||||||
Susan Meaney |
110,000 | 219,976 | — | 329,976 | ||||||||||||
Guy A. Metcalfe(6) |
— | — | — | — | ||||||||||||
Oscar Munoz |
110,000 | 219,976 | — | 329,976 | ||||||||||||
Sanjiv Yajnik |
110,000 | 219,976 | — | 329,976 |
CBRE 2024 PROXY STATEMENT | PROPOSAL 1: ELECT DIRECTORS — DIRECTOR COMPENSATION | 36 |
(1) | Fees Earned or Paid in Cash Column This includes fees associated with the annual Board service retainer, including service as lead independent director and chairing a Board committee. Our non-employee directors may elect to receive shares of our common stock in lieu of cash payments (in like amounts). We reflect these “stock in lieu of cash” payments under the column titled “Fees Earned or Paid in Cash,” and not under the “Stock Awards” column. |
(2) | Stock Awards Column Represents the grant date fair value under Financial Accounting Standards Board, Accounting Standards Codification (“ASC”), Topic 718, Stock Compensation, of all restricted stock units granted to the directors during 2023. See also Note 2 “Significant Accounting Policies” and Note 14 “Employee Benefit Plans” to our consolidated financial statements as reported in our Annual Report on Form 10-K for the fiscal year ended December 31, 2023 for a discussion of the valuation of our stock awards. Shares vest in full on the earlier of the one-year anniversary of grant or the next annual meeting of stockholders. |
(3) | Stock Awards Column Each of Mses. Cobert, Goodman and Meaney and Messrs. Boze, Gilyard, Hutcheson, Jenny, Lopez, Munoz and Yajnik was awarded 2,919 restricted stock units pursuant to our director compensation policy. These restricted stock units were valued at the fair market value of our common stock of $75.36 per share on the award date of May 17, 2023. |
(4) | Ms. Goodman was appointed as our Lead Independent Director on November 15, 2023. The pro-rated portion of her lead independent director annual cash retainer under our director compensation policy was $38,208. The pro-rated portion of her Audit Committee Chair annual cash retainer under our director compensation policy for her service as Audit Committee Chair from May 17, 2023 to November 14, 2023 was $14,717. |
(5) | Mr. Lopez was appointed as our Audit Committee Chair on November 15, 2023. The pro-rated portion of his Audit Committee Chair annual cash retainer under our director compensation policy for his service as Audit Committee Chair from November 15, 2023 to May 21, 2024 was $15,283. |
(6) | Mr. Metcalfe was appointed to our Board on February 26, 2024. Accordingly, he did not receive any director compensation for 2023. |
Outstanding Stock Awards (RSUs)
The table below shows the aggregate number of stock awards (i.e., restricted stock units) outstanding for each non-employee director as of December 31, 2023 (no option awards were outstanding on that date):
Name |
Aggregate Number of Stock Awards Outstanding |
Aggregate Number of Shares Underlying Options Outstanding |
||||||
Brandon B. Boze |
2,919 | — | ||||||
Beth F. Cobert |
2,919 | — | ||||||
Reginald H. Gilyard |
2,919 | — | ||||||
Shira D. Goodman |
2,919 | — | ||||||
E.M. Blake Hutcheson |
2,919 | — | ||||||
Christopher T. Jenny |
2,919 | — | ||||||
Gerardo I. Lopez |
2,919 | — | ||||||
Susan Meaney |
2,919 | — | ||||||
Guy A. Metcalfe(1) |
— | — | ||||||
Oscar Munoz |
2,919 | — | ||||||
Sanjiv Yajnik |
2,919 | — |
(1) | Mr. Metcalfe was appointed to our Board on February 26, 2024. Accordingly, he did not receive any director compensation for 2023. |
CBRE 2024 PROXY STATEMENT | PROPOSAL 2: RATIFY APPOINTMENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM | 37 |
Proposal 2: Ratify Appointment of Independent Registered Public Accounting Firm
The Audit Committee of our Board appointed KPMG LLP as our independent registered public accounting firm to audit our consolidated financial statements for the fiscal year ending December 31, 2024. During 2023, KPMG LLP served as our independent accountant and reported on our consolidated financial statements for that year. KPMG LLP has been our independent auditor at all times since 2008.
The Audit Committee periodically considers whether to rotate our independent auditor in order to assure continuing auditor independence. The Board and the members of the Audit Committee believe that the continued retention of KPMG LLP as the company’s independent auditor in fiscal year 2024 is in the best interests of the company and its stockholders.
We expect that representatives of KPMG LLP will attend the Annual Meeting and will have the opportunity to make a statement if they so desire and to respond to appropriate questions.
Although stockholder ratification is not required, the appointment of KPMG LLP is being submitted for ratification at the Annual Meeting with a view towards soliciting stockholders’ opinions, which the Audit Committee will take into consideration in future deliberations. If KPMG LLP’s selection is not ratified at the Annual Meeting, the Audit Committee will consider the engagement of other independent accountants. The Audit Committee may terminate KPMG LLP’s engagement as our independent accountant without the approval of our stockholders whenever the Audit Committee deems termination appropriate.
Required Vote
Approval of this Proposal 2 requires the affirmative vote (i.e., “FOR” votes) of a majority of the shares present or represented and entitled to vote at our Annual Meeting. A vote to “ABSTAIN” will count as “present” for purposes of this proposal and so will have the same effect as a vote “AGAINST” this proposal. In the absence of instructions, your broker may vote your shares on this proposal. For more information, see “Annual Meeting Information—Voting Instructions and Information—If you do not vote/effect of broker non-votes” beginning on page 91.
RECOMMENDATION
|
The Board of Directors recommends a vote “FOR” the ratification of the appointment of KPMG LLP as our independent registered public accounting firm for the fiscal year ending December 31, 2024. |
CBRE 2024 PROXY STATEMENT | PROPOSAL 2: RATIFY APPOINTMENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM | 38 |
Audit and Other Fees
The following table shows the fees for audit and other services provided by KPMG LLP for the fiscal years ended December 31, 2023 and 2022 (in millions):
Fees |
Fiscal 2023 | Fiscal 2022 | ||||||
Audit Fees |
$ | 20.8 | 19.8 | |||||
Audit-Related Fees |
3.3 | 3.4 | ||||||
Tax Fees |
1.8 | 2.2 | ||||||
Total Fees |
$ | 25.9 | 25.4 |
Audit Fees—Includes fees associated with the audit of our annual financial statements, review of our annual report on Form 10-K and quarterly reports on Form 10-Q, statutory audits, and consents and assistance with and review of registration statements filed with the SEC. In addition, audit fees include those fees related to KPMG LLP’s audit of the effectiveness of our internal controls over financial reporting pursuant to Section 404 of the Sarbanes-Oxley Act.
Audit-Related Fees—Includes fees associated with the audit of our employee benefit plans, accounting consultations related to GAAP, the application of GAAP to proposed transactions, and work related to specific projects in support of GAAP accounting. In addition, audit-related fees include those fees related to KPMG LLP’s examination of the effectiveness of our internal controls over client accounting.
Tax Fees—Includes fees associated with tax compliance at international locations, domestic and international tax advice and planning and assistance with tax audits and appeals.
Audit Committee Pre-Approval Process
The Audit Committee is responsible for overseeing and approving our independent auditor’s fees, and pre-approves all audit and permissible non-audit services provided by our independent auditor. These services may include audit services, audit-related services, tax services and other services. Pre-approval is generally provided for up to one year and any pre-approval is detailed as to the particular service or category of services and is generally subject to a specific budget. Our independent auditors and management are required to periodically report to the Audit Committee regarding the extent of services provided by the independent auditor in accordance with this pre-approval process and the fees for the services performed to date. In certain one-off cases, the Audit Committee Chair (on behalf of the Audit Committee) may also pre-approve particular services, with that pre-approval subject to subsequent Audit Committee ratification.
Audit Committee Report
The Audit Committee consists of five directors, each of whom is independent under NYSE rules and applicable securities laws. The Board has determined that each member of the Audit Committee is financially literate as required under NYSE rules. Our Board has also determined that each of Messrs. Lopez, Munoz and Yajnik meet the qualifications of an audit committee financial expert. The Audit Committee operates under a written charter adopted by the Board, a copy of which is published in the Corporate Governance section of the Investor Relations page of our website at www.cbre.com.
The Audit Committee assists the Board in fulfilling its responsibilities to our stockholders with respect to our independent auditors, our corporate accounting and reporting practices, risk oversight and the quality and integrity of our financial statements and reports. The Audit Committee is directly responsible for overseeing the appointment, compensation, retention and oversight of the work of our independent auditor, and the Audit Committee and its chair oversee the selection of our independent auditor’s lead engagement partner. In addition, the Audit Committee reviews and considers all potential related-party and corporate opportunity transactions involving us and our directors and executive officers.
The Audit Committee discussed with our independent auditors the scope, extent and procedures for the fiscal year 2023 audit. Following completion of the audit, the Audit Committee met with our independent auditors, with and without management present, to discuss the results of their examinations, the cooperation received by the auditors during the audit examination, their evaluation of our internal controls over financial reporting and the overall quality of our financial reporting.
Management is primarily responsible for our financial statements, reporting process and systems of internal controls. In ensuring that our management fulfilled that responsibility, the Audit Committee reviewed and discussed with management the audited financial statements in the Annual Report on Form 10-K for the fiscal year ended December 31, 2023. Discussion topics included the quality and acceptability of the accounting principles, the reasonableness of significant judgments, the clarity of disclosures in the financial statements and an assessment of the work of the independent auditors.
The independent auditors are responsible for expressing an opinion on the conformity of the audited financial statements with GAAP. The Audit Committee reviewed and discussed with the independent auditors their judgments as to the quality and acceptability of our accounting principles and such other matters as are required to be discussed by the Public Company Accounting Oversight Board and the SEC. In addition, the Audit Committee
CBRE 2024 PROXY STATEMENT | PROPOSAL 2: RATIFY APPOINTMENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM | 39 |
received from the independent auditors written disclosures and a letter regarding their independence as required by applicable rules of the Public Company Accounting Oversight Board regarding the independent auditors’ communications with the Audit Committee, discussed with the independent auditors their independence from us and our management and considered the compatibility of non-audit services with the auditors’ independence.
Based on the reviews and discussions described above, the Audit Committee recommended to the Board (and the Board subsequently approved) the inclusion of the audited financial statements in the Annual Report on Form 10-K for the fiscal year ended December 31, 2023 for filing with the SEC.
In addition, the Audit Committee has appointed KPMG LLP as our independent registered public accounting firm for the fiscal year ending December 31, 2024. The Board concurred with the selection of KPMG LLP. The Board has recommended to our stockholders that they ratify and approve the selection of KPMG LLP as our independent registered public accounting firm for the fiscal year ending December 31, 2024.
In accordance with law, the Audit Committee is responsible for establishing procedures for the receipt, retention and treatment of complaints that we receive regarding accounting, internal accounting controls or auditing matters, including the confidential, anonymous submission of complaints by our employees received through established procedures of concerns regarding questionable accounting or auditing matters. The Audit Committee approved the establishment of an ethics and compliance program in 2004 and receives periodic reports from our Chief Ethics & Compliance Officer regarding that program.
Audit Committee
Gerardo I. Lopez, Chair
E.M. Blake Hutcheson
Susan Meaney
Oscar Munoz
Sanjiv Yajnik
Notwithstanding any statement in any of our filings with the SEC that might be deemed to incorporate part or all of any filings with the SEC by reference, including this Proxy Statement, the foregoing Report of the Audit Committee is not incorporated into any such filings.
CBRE 2024 PROXY STATEMENT | PROPOSAL 3: ADVISORY VOTE ON EXECUTIVE COMPENSATION | 40 |
Proposal 3: Advisory Vote on Executive Compensation
Our Board is committed to providing competitive pay opportunities for our executives consistent with the markets in which we compete for talent, and aligning executive compensation with stockholder interests. As a part of that commitment, and in accordance with SEC rules, we are asking you to approve, on an advisory basis, a resolution on the compensation of our named executive officers as reported in this Proxy Statement. This proposal, commonly known as a “say on pay” proposal, gives you the opportunity to endorse or not endorse our 2023 executive compensation program and policies for our named executive officers. The Board has adopted a policy providing for annual “say on pay” advisory votes. Accordingly, in accordance with our current policy, the next “say on pay” vote is expected to occur at our annual meeting of stockholders in 2025.
In deciding how to vote on this proposal, our Board encourages you to review the “Compensation Discussion and Analysis” discussion in this Proxy Statement for a detailed description of our executive compensation philosophy and programs.
This vote is not intended to address any specific item of compensation, but rather the overall compensation that was paid in 2023 to our named executive officers resulting from our compensation objectives, policies and practices as described in this Proxy Statement. Because your vote is advisory, it will not be binding upon the Board. However, the Board and the Compensation Committee value the opinions expressed by our stockholders and will review the voting results in connection with their ongoing evaluation of our executive compensation program.
We received strong support for our executive compensation program from our stockholders at our 2023 annual meeting of stockholders, at which approximately 93% of the votes cast on the “say on pay” proposal were in favor of the 2022 compensation that we paid to our named executive officers. In addition, stockholders that we engaged with as part of our outreach program generally reported that executive compensation was viewed as well-aligned with performance.
Our executive compensation program is designed to align pay and performance, reinforce our corporate strategy and to attract and retain accomplished and high-performing executives and to motivate those executives to consistently achieve short- and long-term goals consistent with and in furtherance of our corporate strategy. To achieve this goal, we have designed an executive compensation program based on the following principles:
• | Paying for performance—A significant portion of each executive’s potential compensation is “at risk,” with incentive programs tied to financial metrics and strategic performance objectives. |
• | Alignment with the interests of stockholders—Equity awards (including those tied to our financial performance) and promoting stock ownership align our executives’ financial interests with those of our stockholders. |
• | Attracting and retaining top talent—The compensation of our executives must be competitive so that we may attract and retain talented and experienced executives. |
• | Transparency and corporate governance—It is critical to us that we are transparent and reflect best practices in corporate governance when establishing our executive compensation. |
The text of the resolution in respect of Proposal 3 is as follows:
RESOLVED, that the compensation paid to our named executive officers for 2023 set forth in the Compensation Discussion and Analysis, the Summary Compensation Table and the related compensation tables and narrative in this Proxy Statement, as disclosed pursuant to Item 402 of Regulation S-K, is hereby approved on an advisory basis.
Required Vote
Approval of this Proposal 3 requires the affirmative vote (i.e., “FOR” votes) of a majority of the shares present or represented and entitled to vote at our Annual Meeting. A vote to “ABSTAIN” will count as “present” for purposes of this proposal and so will have the same effect as a vote “AGAINST” this proposal. A broker non-vote will not count as “present,” and so will have no effect in determining the outcome with respect to this proposal.
RECOMMENDATION
The Board of Directors recommends a vote “FOR” the advisory approval of the compensation of our named executive officers for the fiscal year ended December 31, 2023. |
CBRE 2024 PROXY STATEMENT | EXECUTIVE MANAGEMENT | 41 |
Executive Management
Chad J. Doellinger Age: 48 Executive Vice President, General Counsel and Corporate Secretary |
Mr. Doellinger has been our Executive Vice President, General Counsel and Corporate Secretary since August 2023. He previously served as our Chief Transformation Officer from May 2023 to August 2023 and our Senior Vice President and Deputy General Counsel from May 2020 to May 2023. Prior to joining CBRE, Mr. Doellinger was a Partner at Greenberg Traurig, LLP from November 2018 to May 2020. Mr. Doellinger holds a B.A. and B.S. from the University of Iowa and a J.D. from Yale Law School.
Emma E. Giamartino Age: 41 Chief Financial Officer |
Ms. Giamartino has been our Chief Financial Officer since July 2021. She previously served as our Chief Investment Officer from January 2021 to July 2021. Prior to that, she served as our Executive Vice President of Corporate Development and Global Head of Mergers & Acquisitions from June 2020 to January 2021 and as Head of Mergers & Acquisitions in the Americas from February 2018 to June 2020. Prior to joining CBRE, Ms. Giamartino served as Director of Corporate Development at Verizon Communications from March 2016 to February 2018. She also worked in Nomura’s technology, media and telecommunication investment banking group from June 2010 to March 2016. She began her career at Assured Guaranty (formerly Financial Security Assurance), in the residential mortgage-backed securities group. She previously served as a member of the board of directors of CBRE Acquisition Holdings, Inc., which merged with Altus Power, Inc. (NYSE:AMPS). Ms. Giamartino holds a B.S. in Electrical Engineering from Duke University and an M.B.A. from Columbia Business School.
Vikram Kohli Age: 44 Chief Operating Officer |
Mr. Kohli has been our Chief Operating Officer since April 2023. He previously served as our Chief Executive Officer, CBRE Platform from January 2023 to April 2023, Global Group President, Business Intelligence from July 2021 to December 2022, Vice President, Corporate Finance from July 2020 to July 2021, Chief Operating Officer, South East Asia from April 2019 to July 2020, our Regional Managing Director, South East Asia from April 2018 to April 2019, Executive Director, Sales Manager, Asia Pacific from April 2014 to April 2018 and Senior Director, Global Transactions from August 2012 to April 2014. Mr. Kohli joined CBRE in June 2001 in India as part of the Transactions team focused on occupier advisory and office leasing and has since served in various finance leadership roles, each with increasing responsibility. Mr. Kohli holds a B.B.A. from Delhi University, College of Business Studies and an M.B.A. from Northwestern University, Kellogg School of Management.
Daniel G. Queenan Age: 52 Chief Executive Officer, Real Estate Investments |
Mr. Queenan has been our Chief Executive Officer, Real Estate Investments since May 2022. He previously served as our Chief Executive Officer, Advisory Services from January 2020 to May 2022, Chief Executive Officer, Real Estate Investments from August 2018 to December 2019, Group President, Real Estate Investments from January 2018 to December 2019, President, CBRE Global Investors from April 2017 to December 2019, Chief Operating Officer, CBRE Global Investors from October 2015 to April 2017, Chief Executive Officer, Trammell Crow Company from April 2011 to March 2016, Chief Executive Officer, Asia Pacific from March 2014 to October 2015, Chief Operating Officer, Asia Pacific from August 2013 to March 2014 and President, Central division of Trammell Crow Company from March 2010 to November 2011. From May 2005 to March 2010, Mr. Queenan was the President and Chief Executive Officer of Opus North Corporation, a large U.S. real estate development company. Mr. Queenan holds a B.A. from Marquette University and a J.D. from Mitchell Hamline School of Law.
Robert E. Sulentic Age: 67 Chair, President and Chief Executive Officer |
Mr. Sulentic has been our President and CEO since December 2012. He assumed additional responsibilities as Board Chair in November 2023. Previously, he served in several senior leadership roles, including Group President with responsibility for Asia Pacific, EMEA and the Development Services business; Chief Financial Officer; and President with responsibility for all business segments. At Trammell Crow Company, which CBRE acquired in December 2006, Mr. Sulentic served as Chief Financial Officer, Chief Executive Officer and Board Chair. Mr. Sulentic holds a B.A. from Iowa State University and an M.B.A. from Harvard Business School.
CBRE 2024 PROXY STATEMENT | EXECUTIVE MANAGEMENT | 42 |
Croft Young Age: 51 Chief Investment Officer |
Mr. Young has been our Chief Investment Officer since July 2023. Prior to joining CBRE, Mr. Young was a Managing Director in the Real Estate Investment Banking Group at Morgan Stanley from August 2009 to July 2023, where he covered a range of blue-chip public and private clients in the real estate, investment management, and hospitality/leisure industries. Mr. Young previously was an officer (active duty and reserve) in the United States Marine Corps from 2002 to 2019. He is a member of the board of directors of the Travis Manion Foundation, a nonprofit Veterans Service Organization. Mr. Young holds a B.A. from the University of North Carolina at Chapel Hill and an M.B.A. from the University of North Carolina Kenan-Flager Business School.
CBRE 2024 PROXY STATEMENT | COMPENSATION DISCUSSION AND ANALYSIS | 43 |
Compensation Discussion
and Analysis
This Compensation Discussion and Analysis, or CD&A, provides you with detailed information regarding the material elements of compensation paid to our executive officers, including the considerations and objectives underlying our compensation policies and practices. Although our executive compensation program is generally applicable to all of our executive officers, this CD&A focuses primarily on the program as applied to the following executives (whom we refer to as “named executive officers”):
Robert E. Sulentic Chair, President and Chief Executive Officer
Emma E. Giamartino Chief Financial Officer
Chandra Dhandapani Former Chief Executive Officer, Global Workplace Solutions
John E. Durburg Chief Executive Officer of U.S. and Canada, Advisory Services
Daniel G. Queenan Chief Executive Officer, Real Estate Investments
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CBRE 2024 PROXY STATEMENT | COMPENSATION DISCUSSION AND ANALYSIS — SECTION 1: INTRODUCTION | 44 |
Section 1.
Introduction
Company Performance and Financial Highlights
Our pay-for-performance approach aligns management and stockholder interests. The real estate capital markets environment weighed on our business performance in 2023, particularly the transactional business lines within the Advisory Services and Real Estate Investments segments, which are sensitive to market cycles. While overall net revenue fell 3%, our Resilient Businesses (including the entire GWS business, property management, loan servicing, asset management fees in Investment Management and valuations), together, grew net revenue at a 10% clip. These businesses are well-positioned for growth across market cycles. On the other hand, revenue from our Transactional Businesses (sales, leasing, mortgage origination, carried interest and incentive and development fees) slumped 21% last year, but are poised to resume growth when the market cycle turns. Despite the year’s challenges, we invested approximately $961.3 million in share buybacks (repurchasing approximately 7,867,348 shares), infill M&A and other strategic investments, while ending the year below the midpoint of our target leverage range, giving us substantial liquidity to finance future growth.
Revenue | Net Revenue (1) | GAAP Net Income | ||||||
$31.9B | $18.3B | $986M | ||||||
+3.6% | -2.7% | -30% | ||||||
Core EBITDA (1) | GAAP EPS | Core EPS (1) | ||||||
$2.2B | $3.15 | $3.84 | ||||||
-24.5% | -26.6% | -32.5% | ||||||
1-Year Total Stockholder Return (2) (as of 12/31/2023) | 3-Year Total Stockholder Return (2) (as of 12/31/2023) | 5-Year Total Stockholder Return (2) (as of 12/31/2023) | ||||||
21% | 48% | 132% | ||||||
vs. 26% for S&P 500 (-5% outperformance) |
vs. 33% for S&P 500 (+15% outperformance) |
vs. 107% for S&P 500 (+25% outperformance) |
(1) | These are non-GAAP financial measures. For definitions and more information, see Annex A of this Proxy Statement. Our Board and management use these non-GAAP financial measures to evaluate our performance and manage our operations. However, non-GAAP financial measures should be viewed in addition to, and not as an alternative for, financial results prepared in accordance with GAAP. The term “GAAP,” as used in this Proxy Statement, means generally accepted accounting principles in the United States. |
(2) | Inclusive of dividends, assuming reinvestment. |
CBRE 2024 PROXY STATEMENT | COMPENSATION DISCUSSION AND ANALYSIS — SECTION 1: INTRODUCTION | 45 |
Our performance in 2023 resulted in strong stockholder value creation. This extended a long-term record of consistently increased stockholder value.
Comparison of 5-Year Cumulative Total Return(1) among CBRE Group, Inc., the S&P 500 Index(2) and Peer Group(3)
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(1) | $100 invested on December 31, 2018 in stock or index-including reinvestment of dividends, fiscal year ending December 31. |
(2) | Copyright© 2024 Standard & Poor’s, a division of S&P Global. All rights reserved. |
(3) | Peer group contains companies with the following ticker symbols: JLL, CIGI, CWK, ISS, MMI, NMRK, SVS.L (London) and WD. |
Awards & Recognition
In 2023 and early 2024, we were recognized with the following awards and accolades:
CBRE 2024 PROXY STATEMENT | COMPENSATION DISCUSSION AND ANALYSIS — SECTION 1: INTRODUCTION | 46 |
2023 Compensation Updates
NEO Target Compensation Adjustments. As part of the annual target compensation review, the total annual compensation targets for Mses. Giamartino and Dhandapani were increased to align their compensation with market levels. Compensation targets for our other named executive officers remained unchanged from 2022.
2023 Base Salary | 2023 EBP Target Awards | Total 2023 Annual Equity Awards | ||||
Robert E. Sulentic |
$1,250,000 | $2,500,000 | $14,750,000 | |||
Emma E. Giamartino |
$700,000 (Increase of $20,000) |
$1,100,000 (Increase of $100,000) |
$3,200,000 (Increase of $1,380,000) | |||
Chandra Dhandapani |
$750,000 | $1,100,000 | $3,650,000 (Increase of $250,000) | |||
John E. Durburg |
$775,000 | $1,160,000 | $4,065,000 | |||
Daniel G. Queenan |
$775,000 | $1,160,000 | $4,065,000 |
Additional details about these updates and decisions can be found in “Section 4. Elements of the Compensation Program” in this CD&A.
Long-Term Incentive Award Design
2024 Annual Equity Award Metrics. As part of the Committee’s annual review of our compensation program, and in response to feedback from our investors, the Committee approved a change to the design of our annual performance-based awards. Beginning in 2024, our annual performance-based awards will incorporate two metrics—core EPS and relative total shareholder return. For additional information, please see our Form 8-K, filed on March 11, 2024.
CBRE 2024 PROXY STATEMENT | COMPENSATION DISCUSSION AND ANALYSIS — SECTION 2: OUR EXECUTIVE COMPENSATION PHILOSOPHY | 47 |
Section 2.
Our Executive Compensation Philosophy
Our Pay-for-Performance Philosophy
Our executive compensation program is designed to align pay and performance, reinforce our corporate strategy, attract and retain accomplished and high-performing executives and motivate those executives to consistently achieve short- and long-term goals consistent with our corporate strategy. Our pay philosophy emphasizes pay-for-performance through significant variable compensation tied to accomplishment of financial and strategic objectives.
To do this, we focus a significant percentage of our executive officers’ compensation on both annual and long-term incentive awards intended to drive growth in our business and in our share price in the short- and long-term, with a relatively modest portion of compensation paid in fixed base salary.
Executive Compensation Program Goals
The Committee establishes and administers our executive compensation program. Our short- and long-term compensation incentives are designed to:
LINK PAY TO PERFORMANCE We place a significant portion of each executive officer’s potential compensation “at risk,” with incentive programs tied to financial metrics and strategic performance objectives. |
• In our annual incentive program, the financial metrics may be at the global level (i.e., based on the consolidated results of the enterprise) or based on a combination of global and segment performance, depending on the executive’s position. Payouts may be above, at or below target levels, based on achievement of these financial and strategic objectives.
• All of our long-term incentives have a performance component in that the ultimate value of those incentives depends upon our stock price over a multi-year period. We seek to further link our long-term incentives to our financial results and stockholder returns by awarding a combination of Performance-Based Equity Awards and Time-Vesting Equity Awards.
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ALIGN THE INTERESTS OF OUR EXECUTIVES WITH THOSE OF OUR STOCKHOLDERS | • Our goal is to instill a sense of ownership in the company through equity-based awards and stock ownership requirements applicable to our directors and executives.
• Equity awards align an executive’s financial interests with those of our stockholders by creating incentives to preserve and increase stockholder value as well as achieve solid financial results for our stockholders over a multi-year period.
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ATTRACT AND RETAIN TOP LEADERSHIP TALENT | • To successfully execute our business strategy, we must attract and retain top talent in our industry. To accomplish this goal, we provide our executives with compensation opportunities at levels commensurate with other organizations competing for their talents.
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BE TRANSPARENT AND REFLECT BEST PRACTICES IN CORPORATE GOVERNANCE | • In addition to creating compensation programs that are easily understood and tracked, we have adopted governance policies and practices designed to further align executive compensation with long-term stockholder interests.
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CBRE 2024 PROXY STATEMENT | COMPENSATION DISCUSSION AND ANALYSIS — SECTION 2: OUR EXECUTIVE COMPENSATION PHILOSOPHY | 48 |
2023 Target Compensation Mix
The total 2023 target direct compensation mix for our Chief Executive Officer (“CEO”) and all named Executive Officers (“NEOs”) including our CEO is shown here.
CEO Target Compensation Mix
|
CEO + NEOs Target Compensation Mix
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Overview of Compensation Components
Compensation Component |
Description and Purpose | |||
FIXED | Base Salary |
– Provides a level of fixed compensation necessary to attract and retain senior executives.
– Set at a level that recognizes the skills, experience, leadership and individual contribution of each executive as well as the scope and complexity of the executive’s role, giving due consideration to appropriate comparator group benchmarking.
| ||
VARIABLE | Annual Performance Awards |
– Variable cash incentive opportunity tied to financial metrics and achievement of individual strategic objectives.
– In 2023, the Committee used core EBITDA and segment operating profit to establish financial performance objectives in order to effectively tie annual cash performance compensation to our operating results. We believe that core EBITDA and segment operating profit are appropriate measures to evaluate our operating performance because they focus on profitability but exclude certain items that management does not consider directly indicative of the company’s ongoing performance.
– Each executive had a target cash performance award opportunity, one-half of which depends on the company’s financial performance (the “financial payout factor”) and the other half of which depends on the executive’s personal performance (the “strategic payout factor”).
| ||
Annual Long-Term Incentives |
– Annual grants of time-based and performance-based restricted stock units (RSUs) that are intended to align the interests of our executives with those of stockholders over a multi-year period, and to support executive retention objectives.
– In 2023, our CEO was granted one-third of his target annual long-term incentive award value in the form of a Time Vesting Equity Award, and two-thirds in the form of a Core EPS Equity Award. Our other named executive officers were granted one-half of their target annual long-term incentive award value in the form of a Time Vesting Equity Award, and the other one-half in the form of a Core EPS Equity Award. We describe these two types of awards in greater detail in “Section 4. Elements of Our Compensation Program” in this CD&A.
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CBRE 2024 PROXY STATEMENT | COMPENSATION DISCUSSION AND ANALYSIS — SECTION 2: OUR EXECUTIVE COMPENSATION PHILOSOPHY | 49 |
Compensation Governance Practices
Our compensation program is designed to promote exceptional performance and align the interests of our executives with the interests of our stockholders while discouraging executives from excessive risk taking.
What We Do | What We Don’t Do | |||||||
INDEPENDENCE
100% of our Committee members are independent. The Committee engages its own compensation consultant and confirms each year that the consultant has no conflicts of interest and is independent.
STOCK OWNERSHIP REQUIREMENTS
We have stock ownership requirements for our directors and executive officers that require retention of at least 75% (100% for the CEO) of the net-after-tax shares acquired upon the exercise of stock options, the vesting of restricted stock or the settlement of vested restricted stock units until required ownership levels are met.
• CEO: 6x Base Salary
• CFO and Other NEOs: 3x Base Salary
• Non-employee directors: 5x Annual Stock Grant
COMPENSATION CLAWBACK POLICY
We have a “compensation clawback policy” that requires the company to recover cash- based and performance-based equity incentive compensation paid to any current or former “Section 16 officer” if there is a restatement of our financial results. The policy mandates clawback from any applicable officer who received an award overpayment, without regard to whether any misconduct occurred or whether an officer bears responsibility for the required restatement.
EQUITY AWARD POLICY
Our Equity Award Policy is designed to maintain the integrity of the equity award process and ensure compliance with all applicable laws. The Equity Award Policy sets the procedures that must be followed in connection with employee awards.
STOCKHOLDER ENGAGEMENT
We regularly engage with our stockholders about our executive compensation program.
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NO HEDGING
We have a policy that prohibits all directors, executive officers and other designated insiders from purchasing financial instruments (including prepaid variable forward contracts, equity swaps, collars and exchange funds) or otherwise engaging in hedging or other derivative transactions, that hedge or offset, or are designed to hedge or offset, any decrease in the market value of our securities.
NO “SINGLE TRIGGER” CHANGE OF CONTROL PAYMENTS
We do not have employment contracts, plans or other agreements that provide for “single trigger” change of control payments or benefits (including automatic accelerated vesting of equity awards upon a change of control only) to any of our named executive officers.
NO SPECIAL PERQUISITES
Our named executive officers receive no special perquisites or other personal benefits, unless such benefits serve a reasonable business purpose, such as benefits specifically relating to healthcare and insurance.
NO TAX GROSS-UPS
As a policy matter, we do not provide tax gross-ups to our named executive officers, other than, if applicable, expatriate tax equalization. |
Say on Pay Results
The Committee considers the results of annual stockholder advisory votes on the compensation of our named executive officers, otherwise known as a “say on pay” vote, in connection with the discharge of its responsibilities. We received strong support for our executive compensation from our stockholders at our 2023 annual meeting of stockholders, at which approximately 93% of the votes cast on the say on pay proposal were in favor of the 2022 compensation for our named executive officers. At this Annual Meeting, we will again hold a say on pay vote. The Committee will consider the results of the say on pay in evaluating our executive compensation policies and programs.
CBRE 2024 PROXY STATEMENT | COMPENSATION DISCUSSION AND ANALYSIS — SECTION 3: HOW WE MAKE COMPENSATION DECISIONS | 50 |
Section 3.
How We Make Compensation Decisions
Compensation Committee Role
At the beginning of each performance year, the Committee determines the appropriate target levels of each component of compensation and establishes annual financial and strategic performance objectives for each executive officer based on factors the Committee deems relevant in its business judgment. Following year-end, performance relative to these objectives is measured, and individual annual performance awards are then determined.
When establishing target compensation levels and annual performance objectives, the Committee may consider any factors it deems relevant, including:
• | Industry and market conditions; |
• | The company’s financial performance (i.e., based on the consolidated results of the enterprise and/or segment results); |
• | The company’s global and segment performance relative to competitors; |
• | Our Board-approved annual operating plan and related strategy and objectives; |
• | Individual factors, including performance and expectations, responsibilities, experience, retention risk, succession planning, prior compensation and positioning among other senior executives; |
• | Overall effectiveness of the compensation program in achieving, measuring and rewarding desired performance levels; |
• | The results of our annual “say on pay” vote; |
• | Advice from the Committee’s independent compensation consultant; |
• | Market compensation data among comparable companies; and |
• | Current and evolving practices and trends among comparable companies. |
These factors may vary from year to year based upon the Committee’s subjective business judgment reflecting its members’ collective experience.
Chief Executive Officer Role
Our CEO meets with the Committee and its independent compensation consultant to provide perspective about us and our industry that may be helpful in conducting an accurate survey of relevant market data. In addition, our CEO makes recommendations on non-CEO executive compensation and reviews and provides the Committee with commentary on the competitive pay information regarding non-CEO executive compensation contained in the report of the Committee’s independent compensation consultant. At the invitation of the Committee, our CEO also attends meetings when the performance of other executive officers is discussed. During these meetings, our CEO provides an assessment of those executives’ performance and recommends a payout percentage with respect to the strategic objectives portion of the annual performance bonus for each of those executive officers. The Committee makes all ultimate compensation decisions with respect to our executive officers (including for our CEO), incorporating both the feedback from its independent compensation consultant and our CEO. Our CEO does not attend Committee discussions where the Committee evaluates his performance or sets his compensation.
Independent Compensation Consultant Role
The Committee has retained Frederic W. Cook & Co., Inc., or FW Cook, as its independent compensation consultant. FW Cook reports directly to the Committee, attends meetings and provides advice to the Committee. FW Cook prepares analyses for the Committee based on its review of market data that it believes to be relevant, including compensation levels at, and the financial performance of, a comparator group of companies identified for the relevant period.
FW Cook meets with the Committee and with management to solicit input on job scope, performance, retention issues and other relevant factors. FW Cook then prepares reports for the Committee with respect to management recommendations as to compensation opportunities of the applicable executive officers and the reasonableness of such recommendations. FW Cook works independently with the Committee chair to develop recommendations for CEO compensation. FW Cook also advises the Committee on compensation-related developments and best practices. FW Cook also advises the Governance Committee on non-employee director compensation.
FW Cook has not provided the company any services other than the services that it provides to the Committee and the Governance Committee. After considering, among other things, the other factors described elsewhere in this Proxy Statement with respect to FW Cook’s work for the Committee and (i) the absence of any business or personal relationship between FW Cook and any member of the Committee or any of our executive officers, (ii) a certification from FW Cook that it does not trade in our securities, (iii) FW Cook’s Independence Policy that is reviewed annually by its board of directors, and (iv) FW Cook’s policy of proactively notifying the Committee chair of any potential or perceived conflicts of interest, the Committee has concluded that FW Cook is independent and that its work does not raise any conflict of interest.
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Peer Group Benchmarking—Comparative Market Data
We seek to offer total compensation opportunities competitive with the market in which we compete for executive talent. For some positions, this market is broader than the commercial real estate services and investment industry in which we operate. Accordingly, the Committee periodically reviews comparator company compensation data, general industry compensation survey data and recommendations from FW Cook to understand whether our executive compensation is reasonable and competitive. For certain executives, the Committee examines target compensation levels against business services sector comparators and a broad group of non-manufacturing companies, including those that the Committee considers to be our most comparable public company competitors. This group changes from time to time, and for 2023 executive-compensation-planning purposes it consisted of the following companies:
Benchmarking Compensation Peer Group
Accenture plc | DXC Technology Company | Jones Lang LaSalle Incorporated | ||
AECOM | Fidelity National Information Services, Inc. | ManpowerGroup Inc. | ||
Aon plc | Fiserv, Inc. | Marsh & McLennan Companies, Inc. | ||
Automatic Data Processing, Inc. | Fluor Corporation | The Bank of New York Mellon Corporation | ||
Cognizant Technology Solutions Corporation | Hewlett Packard Enterprise Company | Willis Towers Watson Public Limited Company | ||
Cushman & Wakefield plc | Jacobs Solutions Inc. |
The group of companies listed above includes business services companies outside our industry, with stature, size and complexity that are generally similar to our own, in recognition of the fact that all of our direct competitors are smaller than us and/or are non-public organizations, and competition for certain senior management talent is not limited to our industry. We believe the executive compensation practices of the comparator group, taken as a whole, serves as one appropriate reference for our executive compensation, and we do not target any particular compensation percentile within the comparator group when setting executive compensation.
The Committee considers market compensation data that it believes to be reliable and relevant when establishing executive compensation targets. As one factor in setting compensation targets for our CEO, the Committee examines data for comparable positions in the comparator group described above, which indicates, for example, that our CEO’s base salary and annual incentive targets should be significantly more than those of the next highest paid company executive. This is partly a function of competitive market data, which indicates that chief executive officers are paid significantly higher than other executives, but it also reflects the Committee’s view that our CEO bears ultimate responsibility for our global results and our overall success, such that his compensation opportunity should be set higher. Because reliable comparative data for other positions that might be specific to our business, such as a business-line chief executive officer, is not broadly available from the comparator group, the Committee also reviews compensation data from the comparator group for the most comparable level positions (e.g., 2nd or 3rd highest paid). The Committee also reviews data from outside the identified comparator group that it considers to be a reliable indicator of market compensation levels for those positions. As noted above, market compensation data is only one of many factors considered by the Committee when setting the compensation mix and levels for any particular executive. The actual factors considered by the Committee may vary from year to year based upon the Committee’s subjective business judgment reflecting its members’ collective experience.
Consideration of Stockholder Feedback on Executive Compensation
In 2023, we continued our stockholder outreach program and sought feedback from stockholders on a variety of topics, including strategy and execution, board refreshment, compensation practices, risk oversight, stock ownership requirements, sustainability and culture/human capital. With respect to executive compensation, stockholders generally reported that executive compensation was viewed as well-aligned with performance. The Committee endeavors to incorporate feedback from our stockholders into our annual compensation decisions. For additional information regarding our stockholder engagement program, see “Corporate Governance—Stockholder Engagement” in this Proxy Statement.
Say on Pay Results
The Committee also considers the results of annual stockholder advisory votes on the compensation of our named executive officers in connection with the discharge of its responsibilities. We received strong support for our executive compensation program from our stockholders at our 2023 annual meeting of stockholders, at which approximately 93% of the votes cast on the “say on pay” proposal were in favor of the 2022 compensation for our named executive officers. The Committee will continue to consider the results of these annual advisory votes in evaluating our executive compensation policies and programs.
CBRE 2024 PROXY STATEMENT | COMPENSATION DISCUSSION AND ANALYSIS — SECTION 3: HOW WE MAKE COMPENSATION DECISIONS | 52 |
Compensation Risk Assessment
The Committee annually reviews the risks that may arise from our compensation programs, and in 2023, we undertook a comprehensive assessment of risks relating to those programs. Our management prepared a detailed inventory of all of our compensation programs, and with the assistance of FW Cook, on behalf of the Committee, analyzed each program’s design to determine whether the program creates or encourages excessive or inappropriate risk taking. Based on this review and analysis, we and the Committee have concluded that our compensation programs do not present any risk that is reasonably likely to have a material adverse effect on us.
CBRE 2024 PROXY STATEMENT | COMPENSATION DISCUSSION AND ANALYSIS — SECTION 4: ELEMENTS OF OUR COMPENSATION PROGRAM | 53 |
Section 4.
Elements of Our Compensation Program
Compensation Elements for NEOs
The compensation program for our named executive officers consists primarily of three elements: base salary, annual performance awards (paid in cash), and long-term equity-based incentives (granted with time-based and performance-based vesting conditions). We endeavor to attract, motivate and retain exceptional individuals with demonstrated leadership and other capabilities required to implement innovative business initiatives, while concurrently encouraging those leaders to work towards ambitious long-term business objectives. We further seek to customize our pay practices based on individual performance, leadership and potential, as well as global and segment results. We assess our executives in the context of a methodical performance management process. We believe that our pay practices support all of these efforts.
A significant percentage of our executive officers’ annual compensation package is variable, consisting of annual cash performance awards and long-term equity-based incentives. As shown in the charts below, for 2023, the target annual cash performance awards and long-term equity incentives comprised approximately (i) 93% of total target direct compensation for our CEO and (ii) on average 89% of total target direct compensation for our CEO together with our other named executive officers.
2023 CEO “At Risk” Performance-Based Compensation
2023 NEO “At Risk” Performance-Based Compensation
Base Salary
We provide competitive base salaries that allow us to attract and retain a high-performing leadership team at a reasonable level of fixed costs. Base pay levels generally reflect a variety of factors, such as the executive’s skill and experience, the seniority of the position, the difficulty of finding a replacement, affordability and the positioning of the base pay against market salary levels and against base salaries of other senior executives at the company. Base salaries are generally reviewed annually during the first quarter of the year but may also be reviewed at other times if an executive officer’s responsibilities have materially changed or other special circumstances so warrant.
“Section 4. Elements of Our Compensation Program—2023 Compensation Decisions” in this CD&A describes any base salary increases for named executive officers in 2023.
Annual Performance Awards—Executive Bonus Plan
In 2023, the Committee granted annual performance awards to our executive officers under our Executive Bonus Plan, or EBP. Consistent with prior years, the EBP is based on two key components, financial performance and strategic performance. Within the framework of the EBP, the Committee establishes target and maximum award opportunities and corresponding performance goals and determines actual payouts for our executives. The EBP is designed to motivate and reward executives by aligning pay with annual performance, and the amount of an award is measured by the executive’s success against
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a combination of challenging financial and strategic performance objectives established by the Committee. We may determine in any year to pay an award under the EBP in cash, or in the form of company stock or other non-cash forms of compensation.
2023 Financial Metrics under the EBP
In 2023, 50% of each executive’s annual performance award was based on achievement of financial performance targets.
The Committee used core EBITDA for our global business (measured against plan) when establishing 2023 financial performance targets under the EBP for our CEO and other corporate executives with enterprise-wide roles to effectively tie compensation to our operating results. We believe that core EBITDA is an appropriate measure to evaluate our operating performance because it focuses on profitability but excludes certain items that management does not consider directly indicative of the company’s ongoing performance.
For our executives who have direct responsibility for our business segments, their 2023 financial performance targets were based on a combination of core EBITDA for the global business and segment operating profit. We believe segment operating profit is an appropriate measure to evaluate segment operating performance because it focuses on profitability but excludes certain items that management does not consider directly indicative of the relevant segment’s ongoing performance. We believe it is appropriate that the financial metrics driving compensation outcomes match the metrics by which the business is managed. We believe that this combined measurement encourages our executives to collaborate across and contribute to the success of our entire enterprise, while also holding executives accountable for the results of the segment they lead.
Following year-end, our actual financial performance is then compared to the targeted financial performance. For our executives to be eligible to receive any award under the financial component of the EBP for 2023, our actual financial performance had to exceed 70% of the applicable target for core EBITDA/segment operating profit. Performance at the target level for core EBITDA/segment operating profit would have resulted in a payout of 100% of target for the financial component, and performance at 130% or greater of the target level for core EBITDA/segment operating profit would have resulted in a payout of 200% of target for the financial component. For performance between 70% and 130% of the target goal, payout for the financial component is linearly interpolated.
The 2023 core EBITDA/segment operating targets for our named executive officers as compared to actual core EBITDA/actual segment operating profit in 2023 is summarized below. Targets for 2023 were set with the expectation that the operating environment for commercial real estate would be significantly challenged in 2023, with inflation, rising interest rates, constricted capital availability and economic uncertainty expected to significantly impact the company’s operating results.
Target for 2023 core EBITDA/segment (in millions) |
Actual 2023 core EBITDA/segment (in millions) |
Actual Achievement Against Target |
Payout Factor |
Relevant Business Objective Weighting |
||||||||||||||||
Robert E. Sulentic Emma E. Giamartino |
$ | 2,663 | $ | 2,209 | 83 | % | 43 | % | Global (100%) | |||||||||||
Chandra Dhandapani |
$ $ |
2,663 1,012 |
|
$ $ |
2,209 1,006 |
|
|
83 99 |
% % |
|
43 98 |
% % |
|
Global (50%) GWS (50%) |
| |||||
John E. Durburg |
$ $ |
2,663 1,707 |
|
$ $ |
2,209 1,364 |
|
|
83 80 |
% % |
|
43 33 |
% % |
|
Global (50%) Advisory (50%) |
| |||||
Daniel G. Queenan |
$ $ |
2,663 352 |
|
$ $ |
2,209 239 |
|
|
83 68 |
% % |
|
43 0 |
% % |
|
Global (50%) REI (50%) |
|
“Section 5. 2023 NEO Compensation and Performance Summaries” in this CD&A includes a discussion of each named executive officer’s 2023 financial objectives.
2024 Financial Metrics under the EBP
For 2024, the Committee continued to use core EBITDA for our global business (measured against plan) to establish 2024 financial performance targets under the EBP for our CEO and other corporate executives with enterprise-wide roles. We also continued to use a combination of core EBITDA and segment operating profit to set 2024 financial performance targets for executives who run our business segments. We do not disclose the specific financial targets for 2024 due to competitive reasons; however, we will disclose the 2024 targets and actual results in the 2025 CD&A.
2023 Strategic Objectives under the EBP
Although company financial performance is critical to our success, the Committee also believes that a substantial portion of the EBP award (50% for 2023) should take into account the executive’s overall performance, including the achievement of important strategic objectives. The strategic objective component of annual performance awards under the EBP is both qualitative and quantitative in measurement. These pre-set objectives—which the Committee approves for each executive at the beginning of each performance year—enable the Committee to influence management’s performance against strategies beyond near-term financial objectives to include certain strategic objectives related to ESG initiatives, the positioning of our business
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for the future, the advancement of our platform, and the mitigation of risk. We believe this approach is also responsive to our stockholders that have requested linking earned incentive compensation to annual progress against longer-term strategic goals, including important ESG initiatives. See “Section 5. 2023 NEO Compensation and Performance Summaries” in this CD&A for a discussion of the specific 2023 strategic objectives approved for each named executive officer.
Pursuant to the EBP, following the end of the performance year, the CEO (or in the case of the CEO, the Committee) reviews each executive’s overall performance, taking into account the various strategic objectives that were established at the beginning of the year and any special factors that could have affected performance during the year, such as other objectives and measures that may have become important to us or the executive during the year that are not reflected in the formal strategic objectives approved at the beginning of the performance year.
Under our EBP, the CEO (or the Committee, as applicable) then determines the payout factor, as a percentage of target, for the strategic performance component using the ratings framework below:
Strategic Performance Measurement Scorecard
Rating |
Performance Assessment | Strategic Payout Factor (% of Target) | ||
1 |
Far Below Expectations | 0% | ||
2 |
Partially Met Expectations | 75% | ||
3 |
Met Expectations | 100% | ||
4 |
Somewhat Exceeded Expectations | 125% | ||
5 |
Far Exceeded Expectations | 150% |
2023 EBP Award Payout Determination
The payouts for the financial component and the strategic component of the EBP award, each as described above, are then added together to arrive at a total 2023 EBP award. Payout on the financial component (weighted 50%) may range from 0 to 200% of target, while payout on the strategic component (weighted 50%) may range from 0 to 150% of target. As a result, the maximum payout for 2023 EBP awards is 175% of target. The Committee may also determine to issue to our CEO a supplemental and discretionary award under our EBP in exceptional and exceedingly deserving circumstances, and our CEO (subject to ratification by the Board or the Committee) may determine to issue to our other executive officers a supplemental and discretionary bonus under the EBP in such circumstances not to exceed 200% of the target award. No supplemental EBP awards were awarded in 2023.
“Section 5. 2023 NEO Compensation and Performance Summaries” in this CD&A describes how each named executive officer’s EBP payout for 2023 was calculated.
Long-Term Incentive Awards
We use equity compensation as a long-term incentive to create alignment with stockholders, to reward achievement of multi-year financial objectives, and as a retention tool for top executives that have the most direct impact on corporate results. The link to performance in our long-term incentive grants is prospective in nature. For example, equity grants encourage executives not only to contribute to the creation of additional stockholder value but also to help maintain and preserve existing stockholder value—because the executives share in that value through their equity. Our equity grants are subject to multi-year vesting schedules, which help us to retain key talent.
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Annual Long-Term Incentive Program
In 2023, the Committee granted annual equity awards in two forms—a Time Vesting Equity Award and a Core EPS Equity Award.
2023 Annual Equity Award Grant Metrics
TIME VESTING EQUITY AWARD RSUs |
Vest 25% per year in 2024, 2025, 2026 and 2027, subject to the executive’s continued service. | |
CORE EPS EQUITY AWARD Performance-based RSUs |
May be earned from 0 to 200% of the target number of performance-based RSUs, based on the extent to which our cumulative 2023 to 2024 core EPS performance meets, exceeds or falls short of established targets. We do not disclose these targets prior to the end of the performance period for competitive reasons.
If actual core EPS is less than the minimum threshold, then none of the units will be earned. Achievement of the threshold, target, and maximum core EPS goals would result in payout of 50%, 100%, and 200% of the target units, respectively. The payout is linearly interpolated for performance between the core EPS threshold and target and for performance between and the core EPS target and maximum.
Any earned performance-based RSUs vest in full in March 2026. | |
AWARD DETERMINATIONS | For our CEO, the Committee determines the amount of his equity award. For our other executive officers, our CEO recommends to the Committee the recipients of equity awards as well as the amount of each award. In evaluating these recommendations and making its final award determinations for all executive officers, the Committee considers:
• the executive’s position within our organization;
• ongoing performance and expected contributions by the executive to our future success; and
• input from FW Cook, taking into consideration relevant market data (when applicable), pay equity among the relevant employee group and other factors. |
2024 Annual Equity Award Grant Metrics
As part of the Committee’s annual review of our compensation program, and in response to feedback from our investors, the Committee approved a change to the design of our annual performance-based awards. Beginning in 2024, our annual performance-based awards will incorporate two metrics—core EPS and relative total shareholder return. For additional information, please see our Form 8-K, filed on March 11, 2024.
Strategic Equity Awards
The Committee uses strategic equity awards as a tool to align pay and performance. As seen below, the Committee has used these awards to create immediate alignment within the executive ranks by allowing key individuals to participate in the same program or effectively the same program with the same goals and performance periods in cases of new hires or promotions since the original 2017 Strategic Equity Awards were granted.
2017 Strategic Equity Award
The 2017 Strategic Equity Award was a six-year cliff vesting award with challenging performance hurdles, that required executives to enter into restrictive covenants as described below. This award was structured to:
• | encourage focus on longer-term business outcomes (performance periods are six years); and |
• | provide our executives with a significant and incremental financial incentive to achieve superior outcomes for our stockholders. |
NEO Eligibility: In 2017, in exchange for the execution of certain restrictive covenants described below, a group of our most senior executives around the globe, including Ms. Dhandapani and Messrs. Durburg and Queenan, received Strategic Equity Awards with a six-year cliff vesting period (2018-2023).
In 2017, the Committee also offered Mr. Sulentic a significant Strategic Equity Award, which Mr. Sulentic declined. Notwithstanding the fact that Mr. Sulentic did not participate in the 2018-2023 program, Mr. Sulentic entered into the same Restrictive Covenants Agreement with the company as our other named executive officers.
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The 2017 Strategic Equity Award granted to Ms. Dhandapani and Messrs. Durburg and Queenan was strongly performance-based, with vesting of two-thirds of the award to each executive driven by the extent to which the company achieved rigorous cumulative Adjusted EPS and total stockholder return performance hurdles relative to the S&P 500 over a six-year performance period.
The 2017 Strategic Equity Award was split into three types of RSU awards:
TIME VESTING STRATEGIC EQUITY AWARD (one-third of target grant value) |
VESTING: Cliff vested on December 1, 2023 (six years from grant). | |
RELATIVE TSR (“rTSR”) STRATEGIC EQUITY AWARD (one-third of target grant value) |
Granted with a target number of RSUs, zero to 175% of which could be earned based on the cumulative total stockholder return (“TSR”) of the company compared to the cumulative TSR of each of the other companies comprising the S&P 500 on December 1, 2017 (the “S&P 500 Comparison Group”).
PERFORMANCE PERIOD: Six-year measurement period commencing on December 1, 2017 and ending on December 1, 2023.
VESTING: Such awards vested on January 23, 2024, which was the date the Committee certified the performance percentile ranking achieved.
“Section 4. Certified Achievement for Strategic Equity Award Granted in 2017 and 2021” in this CD&A describes the level at which the rTSR-based equity awards vested. | |
RELATIVE EPS (“rEPS”) STRATEGIC EQUITY AWARD (one-third of target grant value) |
Granted with a target number of RSUs, zero to 175% of which could be earned based on the cumulative adjusted EPS growth of the company compared to the cumulative EPS growth, as reported under GAAP, of each of the other companies in the S&P 500 Comparison Group.
PERFORMANCE PERIOD: Six-year measurement period commencing on January 1, 2018 and ending on December 31, 2023.
VESTING: Such awards vested on March 25, 2024, which was the date the Committee certified the performance percentile ranking achieved.
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