Page 52 - Martin Marietta - 2022 Proxy Statement

PAY DECISIONS AND COMPENSATION GOVERNANCE PRACTICES / COMPENSATION DISCUSSION AND ANALYSIS

Pay Decisions and Compensation Governance Practices
A number of key 2021 compensation-related decisions resulted from our achievements, which are discussed more fully in
this section. The Committee believes that our executive compensation program continues to reflect a strong
pay-for-performance philosophy and is well aligned with the interests of shareholders. In addition, we believe that our
compensation practices are consistent with our pay decisions.

WHAT WE DO YES
Pay for performance Tie pay to performance by ensuring that a significant portion of NEO compensation is
performance-based and at-risk.

Median compensation We generally aim to align all target compensation elements for our executives with the
targets median of our peer group companies.
PSUs are a substantial PSU grants, tied to our achievement of specified performance measures, comprised
portion of LTI approximately 55% of the total value of annual long-term incentive grants made to our NEOs
in 2021. Performance-based RSUs comprised the remaining 45%.
Independent
compensation The Committee retains an independent compensation consultant.
consultant
Robust share We have robust stock ownership guidelines of 7 times base salary for the CEO, 5 times base
ownership salary for our other NEOs, and 5 times annual retainer for Directors. We also have an equity
requirements retention requirement of 50% of net shares paid as incentive compensation until ownership
guidelines are met.
Clawback policy We have a compensation recovery (clawback) policy that requires officers to forfeit certain
cash-based incentive compensation and/or equity-based incentive compensation if the
company restates its financial statements due to the officer’s misconduct.
Regular engagement
with shareholders We engage with shareholders to hear their views on compensation and other issues.

Annual elections All of our Directors stand for election each year.

WHAT WE DON’T DO NO

No employment None of our NEOs or other executive officers have employment contracts that guarantee
contracts continued employment.
No dividends on Our 2021 RSU and PSU awards require three years to fully vest and dividends paid on shares
unvested awards of common stock of Martin Marietta during the vesting period are only paid to award holders
if and when an award vests.
No pledging of shares Our directors and executive officers are not permitted to pledge Martin Marietta shares as
collateral for loans or any other purpose.

No hedging We prohibit directors and executive officers from engaging in short sales of Martin Marietta
stock or similar transactions intended to hedge or offset the market value of Martin Marietta
stock owned by them.
No 280G gross-ups We do not provide executives with Section 280G excise tax gross-ups.

No single trigger Equity awards will not automatically vest as a result of a change in control.
equity vesting
Minimal executive We do not provide NEOs with country club reimbursements, personal use of the Company
perquisites aircraft unrelated to business travel, or other excessive perks.

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