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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

SCHEDULE 14A

(Rule 14a-101)

INFORMATION REQUIRED IN PROXY STATEMENT

SCHEDULE 14A INFORMATION

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ExlService Holdings, Inc.

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320 Park Avenue, 29th Floor
New York, NY 10022
(212) 277-7100

    

April 23, 2021

Dear Stockholder,

As we look back at 2020, we are proud of our performance and perseverance despite the uncertainties that marked this unprecedented year. The efforts EXL put in place early, such as shifting our 30,000+ global workforce to a work from home model, ensuring the health and safety of our employees and safeguarding the business continuity of our clients, helped establish the momentum that we would carry throughout the year. Ultimately, through a combination of ingenuity, hard work and collaboration, we demonstrated agility and resilience in the face of crisis. We ended the year with stronger client relationships, expanded capabilities and a reaffirmation of our mission to work as one team to help our clients transform.

2020 provided a unique opportunity for us to implement our philosophy of looking deeper, finding a better way, and making it happen. Our character and culture stood out more than ever as we exemplified our core values of collaboration, innovation, excellence, integrity and respect.

For the year, we generated revenues of $958.4 million, representing a 3.3% decline from 2019. Like most of the market, the second quarter resulted in the most severe impact on our revenues resulting from COVID-19, representing an 8.6% decline in revenue during that quarter. Owing to the resiliency of our business model and new demand for our services in the second half of the year, we were able to close the year with strong revenue momentum. We also focused on our expense base as a means to mitigate the impacts of COVID-19. EXL achieved record profitability with diluted EPS of $2.59, up from $1.95 in 2019.

There are two key trends that drove our strong performance in 2020 and we believe that these trends will provide momentum for future revenue growth: (1) accelerated demand for our full suite of data and analytics capabilities and (2) leveraging cloud-based solutions to embed intelligence in operations.

First, the massive migration of consumers onto digital channels amid the uneven economic recovery has spurred demand for data-driven insights and powerful analytics. As a result, we are seeing surging interest in our data-led value creation framework, which is being used by clients in every industry we serve to deliver more personalized customer experiences, optimize costs and support resilient operating models. We are well positioned to capitalize on this accelerated market demand.

The second key trend is our cloud solutions offerings through which we are able to embed Artificial Intelligence (AI) in operations, fueling the growth in our operations management business. The Cloud has become central to our clients' resilience strategies and it is the lynchpin to powering advanced data and analytics functions. We are currently investing in a cloud center of excellence and our partnership ecosystem to develop and go-to-market with these cloud-native AI solutions. With several solution pilots underway, we are co-innovating with our clients and partners to solve strategic business problems.

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We have entered 2021, our 15th year as a public company, with strong momentum in our large deals pipeline and new logos of leading companies to our client portfolio.

Most importantly, though, the success we have enjoyed in such a difficult year is a testament to the amazing contributions of so many hard-working individuals. We greatly appreciate the contribution of all our colleagues around the world and the support of our stockholders, clients and partners, and we look forward to seeing what we can all accomplish together in 2021.

Our efforts to be good stewards of your capital and to provide industry-leading services to our clients are not our only pledge to our stockholders and other stakeholders. We view our sustainability efforts as integral to our long-term success, durability and resiliency as an organization.

In last year's letter to stockholders, we pledged to improve our disclosure on our sustainability efforts. We have delivered on that pledge. In November 2020, we published our first Sustainability Report according to the UN Sustainability Development Goals and the Global Reporting Initiative standards, which outlines our efforts and goals for improving the environment, human capital management, and corporate social responsibility, among others. More recently, we applied and will soon become a participant in the UN Global Compact. You can read more about our recent accomplishments in sustainability in the "Sustainability" section of this Proxy Statement.

We also continue to improve upon our strong corporate governance practices. At the end of 2020, we launched our formal stockholder engagement program, through which we hold meetings with our stockholders on topics relating to strategy, performance and governance, including board refreshment. These conversations inform our governance practices. Please refer to the "Corporate Governance" section of this Proxy Statement to learn more about governance practices and philosophy.

The success we have enjoyed in such a difficult year is a testament to the amazing contributions of many hard-working individuals. We look forward to seeing what EXL will accomplish in 2021.

Finally, we wish to thank David Kelso and Deborah Kerr, who will be departing from our board of directors following our 2021 Annual Meeting of Stockholders, for their service to EXL.

On behalf of the board of directors of ExlService Holdings, Inc., we are pleased to invite you to the 2021 Annual Meeting of Stockholders, which will be held on June 16, 2021. We look forward to sharing more about our Company at the Annual Meeting. Due to concerns regarding the current public health crisis related to the COVID-19 pandemic and the health and wellbeing of our stockholders, employees and directors, we will hold our Annual Meeting in virtual format only via live audio webcast instead of holding the meeting in New York or at any physical location. We encourage you to read carefully the attached 2021 Annual Meeting of Stockholders and Proxy Statement, which contain important information about the matters to be voted upon and instructions on how you can vote your shares.

 

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Your vote is important to us. Please vote as soon as possible whether or not you plan to participate in the Annual Meeting.

The board of directors and management look forward to seeing you at the Annual Meeting.

Sincerely,

 
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Garen K. Staglin
Chairman
  Rohit Kapoor
Vice Chairman and CEO
   

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NOTICE OF 2021 ANNUAL MEETING OF STOCKHOLDERS    

Dear Stockholder:

 

 

You are cordially invited to the 2021 Annual Meeting of Stockholders of ExlService Holdings, Inc., a Delaware corporation (the "Company"), for the purposes of voting on the following matters:

 

 

    1.

 

the election of nine members of the board of directors of the Company;

 

 

    2.

 

the ratification of the appointment of Deloitte & Touche LLP as the independent registered public accounting firm of the Company for fiscal year 2021;

 

 

    3.

 

the approval, on a non-binding advisory basis, of the compensation of the named executive officers of the Company; and

 

 

    4.

 

the transaction of such other business as may properly come before the Annual Meeting or any adjournment or postponement thereof.

 

 

Due to the current state of the public health crisis related to COVID-19, and the health and wellbeing of our stockholders, employees and directors, we will hold our Annual Meeting in virtual format only, via live audio webcast (rather than at any physical location) on June 16, 2021 at 9:30 AM, Eastern Time, instead of holding the meeting in New York or at any physical location. You or your proxyholder may participate, vote, and examine our stockholder list at the Annual Meeting by visiting www.virtualshareholdermeeting.com/EXLS2021 and using your 16-digit control number.

 

 

If you are a stockholder of record at the close of business on April 19, 2021, the record date for the Annual Meeting, you are entitled to vote at the Annual Meeting. A list of stockholders as of the record date will be available for examination for any purpose germane to the Annual Meeting, during ordinary business hours, at the Company's executive offices at 320 Park Avenue, 29th Floor, New York, New York 10022, for a period of 10 days prior to the date of the Annual Meeting and at the Annual Meeting itself. If our corporate headquarters are closed during the 10 days prior to the Annual Meeting, you may send a written request to the Corporate Secretary at our corporate headquarters, and we will arrange a method for you to inspect the list. The list of stockholders will also be available during the Annual Meeting at www.virtualshareholdermeeting.com/EXLS2021.

 

 

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    Please note the technical requirements for virtual attendance at the Annual Meeting, as described in the enclosed Proxy Statement beginning on Page 117 under the heading "Annual Meeting Q&A."

 

 

Pursuant to rules promulgated by the Securities and Exchange Commission, we are providing access to our proxy materials over the Internet. On or about April 23, 2021, we will mail a Notice of Internet Availability of Proxy Materials (the "Internet Notice") to each of our stockholders of record and beneficial owners at the close of business on the record date. On the date of mailing of the Internet Notice, all stockholders and beneficial owners will have the ability to access all of the proxy materials on a website referred to in the Internet Notice. These proxy materials will be available free of charge.

Whether or not you expect to attend the Annual Meeting, the Company encourages you to promptly vote and submit your proxy by (i) Internet (by following the instructions provided in the Internet Notice), (ii) by phone (by following the instructions provided in the Internet Notice) or (iii) by requesting that proxy materials be sent to you by mail that will include a proxy card that you can use to vote by completing, signing, dating and returning the proxy card in the prepaid postage envelope provided. Voting by proxy will not deprive you of the right to attend the Annual Meeting or to vote your shares. You can revoke a proxy at any time before it is exercised by voting at the Annual Meeting, by delivering a subsequent proxy or by notifying the inspector of elections in writing of such revocation prior to the Annual Meeting. YOUR SHARES CANNOT BE VOTED UNLESS YOU EITHER (I) VOTE BY USING THE INTERNET, (II) VOTE BY PHONE, (III) REQUEST PROXY MATERIALS BE SENT TO YOU BY MAIL AND THEN USE THE PROXY CARD PROVIDED BY MAIL TO CAST YOUR VOTE BY COMPLETING, SIGNING AND RETURNING THE PROXY CARD BY MAIL OR (IV) ATTEND THE ANNUAL MEETING AND VOTE.

By Order of the Board of Directors

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Ajay Ayyappan

Senior Vice President, General Counsel and Corporate Secretary

New York, New York

April 23, 2021

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2021 PROXY STATEMENT

TABLE OF CONTENTS

2021 PROXY STATEMENT SUMMARY

 
8

OUR BOARD OF DIRECTORS

 
18

CORPORATE GOVERNANCE

 
30

SUSTAINABILITY

 
47

OUR EXECUTIVE OFFICERS

 
59

EXECUTIVE COMPENSATION

 
61

Compensation Discussion and Analysis

 
61

Compensation Committee Report

 
85

Summary Compensation Table for Fiscal Year 2020

 
86

STOCK OWNERSHIP OF DIRECTORS, EXECUTIVE OFFICERS AND CERTAIN BENEFICIAL OWNERS

 
106

CERTAIN RELATIONSHIPS AND RELATED PERSON TRANSACTIONS

 
108

AUDIT COMMITTEE REPORT

 
109

PROPOSAL 1 — ELECTION OF DIRECTORS

 
110

PROPOSAL 2 — RATIFICATION OF THE APPOINTMENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

 
112

PROPOSAL 3 — ADVISORY (NON-BINDING) VOTE ON EXECUTIVE COMPENSATION

 
114

STOCKHOLDER PROPOSALS AND DIRECTOR NOMINATIONS FOR THE 2022 ANNUAL MEETING

 
115

MISCELLANEOUS

 
116

ANNUAL MEETING Q&A

 
117

OTHER MATTERS

 
121

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2021 PROXY STATEMENT SUMMARY

2021 PROXY STATEMENT SUMMARY


SUMMARY


Below is a summary of select components of this proxy statement, including information regarding this year's stockholder meeting, nominees for our board of directors, summary of our business, performance highlights and selective executive compensation information. This summary does not contain all of the information that you should consider prior to submitting your proxy, and you should review the entire proxy statement and our Annual Report on Form 10-K for the fiscal year ended December 31, 2020 (the "2020 Form 10-K"). We refer to the fiscal year ended December 31, 2020 as "fiscal year 2020," "fiscal 2020," and "2020."


MEETING AGENDA, VOTING MATTERS AND RECOMMENDATIONS

Voting Proposal Item

 

Board Vote Recommendation

1. Election of directors

 

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Required Vote: Affirmative vote of a majority of shares present in person* or represented by proxy and entitled to vote


 

2. Ratification of appointment of independent registered public accounting firm

 

GRAPHIC     FOR (pg. 112)


Required Vote: Affirmative vote of a majority of shares present in person* or represented by proxy and entitled to vote


 

3. Advisory (non-binding) vote on executive compensation

 

GRAPHIC     FOR (pg. 114)


Required Vote: Affirmative vote of a majority of shares present in person* or represented by proxy and entitled to vote


*Virtual attendance at our Annual Meeting will constitute presence in person for purposes of quorum and voting at the Annual Meeting.

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2021 PROXY STATEMENT SUMMARY

OUR BUSINESS

We are a leading operations management and analytics company that helps our clients build and grow sustainable businesses. By orchestrating our domain expertise, data, analytics and digital technology, we look deeper to design and manage agile, client-centric operating models to improve global operations, drive profitability, enhance client satisfaction, increase data-driven insights, and manage risk and compliance. Headquartered in New York, as of March 31, 2021 we had approximately 31,600 professionals in locations throughout the United States, the United Kingdom, Europe, India, the Philippines, Colombia, Canada, Australia and South Africa. We serve clients in multiple industries, including insurance, healthcare, banking and financial services, utilities, travel, transportation and logistics, media and retail, among others.

Company 3 Year Performance

        Revenue (Year-over-year growth %)  

Revenue and Segment Information ($ in millions)

        2018 YOY%         2019 YOY%         2020 YOY%
 

Insurance Segment

      $ 311.2     15.8%       $ 346.4     11.3%       $ 341.8     –1.3%  

Healthcare Segment

        89.8     5.4%         97.5     8.5%         101.2     4.0%  

Emerging Business Segment

        196.8     –0.8%         190.1     –3.4%         152.7     –19.7%  

Analytics Segment

        285.3     35.90%         357.3     25.3%         362.7     1.5%  

Consolidated

      $ 883.1     15.8%       $ 991.3     12.3%       $ 958.4     –3.3%  

While our annual revenues decreased from $991.3 million in fiscal year 2019 to $958.4 million in fiscal year 2020, we improved our net income attributable to stockholders by 32% to $89.5 million. During the first fiscal quarter ended March 31, 2020, COVID-19 did not have a significant impact on our business, however, in subsequent quarters, COVID-19 materially impacted us. Among other actions in 2020, we adapted delivery for our clients to a work from home model; took actions in response to the pandemic that focused on helping our employees; and implemented a series of cost reduction measures. For more information regarding these and other business highlights, please see Pages 63 to 65 below and the 2020 Form 10-K.

The graphs below compare our 1-year, 3-year and 5-year cumulative total stockholder return ("TSR") as of December 31, 2020 with the median TSR for companies comprising Nasdaq, S&P 600 and our peer group.

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2021 PROXY STATEMENT SUMMARY

OUR PURPOSE AND CORE VALUES

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2021 PROXY STATEMENT SUMMARY

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CORPORATE GOVERNANCE HIGHLIGHTS

Based on current board profile and practices (including our nine director nominees, and our two directors who currently serve on our board, but will not be standing for reelection)

Board of Directors Composition

11 directors, all of whom are independent, except for our Vice Chairman and CEO

Independent board chairman

Seasoned board of directors, with diverse experience, including in human capital management, corporate sustainability, insurance, healthcare, utilities, consulting, banking and financial services, finance/accounting, global business and technology

Diversity in age, ethnicity, gender and other important characteristics

Declassified board

Board Accountability

Majority voting standard for uncontested elections

Annual board- and committee-level evaluations

Regularly-held executive session of non-management directors

Robust executive and director equity ownership guidelines

Independent board of directors evaluation of CEO performance and compensation

Governance Practices

Regular executive sessions

Standing board committees composed solely of independent chairs and members

Equity ownership guidelines

Independent compensation consultant

Board risk oversight and assessment

Board committee oversight over sustainability efforts

Director training and education

Simultaneous service restrictions

Active stockholder engagement program addressing strategy, performance and governance

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2021 PROXY STATEMENT SUMMARY

Director Qualifications

Our board of directors reflects an effective and diverse mix of skills, background and experience appropriate for our Company and industry. Our directors have the following attributes:

Executive Leadership Experience

Board Experience

Finance and Accounting Expertise

Client and Industry Expertise

Global Experience

Risk Oversight/Management Expertise

Human Capital Management Expertise

Diverse Backgrounds

Experience in Environmental, Social and Governance Matters

Strategic Insight

Commitment to Accountability, Excellence and Continuous Improvement

Commitment to Driving our Growth and Success

 

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Skills Matrix

 
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Finance
and
Accounting

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Executive
Leadership

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Public
Company
Governance

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Technology

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Analytics

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Human
Capital
Management

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Operations
Management

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Marketing
and
Branding

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International
Companies

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Risk
Oversight
and
Management


 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 
Garen Staglin                      
Rohit Kapoor                    
David Kelso                          
Deborah Kerr                      
Anne Minto                            
Som Mittal                        
Clyde Ostler                        
Vikram Pandit                    
Kristy Pipes                      
Nitin Sahney                          
Jaynie Studenmund                    

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2021 PROXY STATEMENT SUMMARY

NOMINEES FOR ELECTION AS DIRECTORS

Name
   
  Director
Since

   
  Experience*
   
  Committee
Membership

Garen Staglin
Chairman
      June
2005
      Former Chief Executive Officer of eONE Global LP and Safelite Auto Glass; Chairman of the Company since 2014       Compensation Committee; Nominating and Governance Committee
Rohit Kapoor
Vice Chairman
      November
2002
      Co-founded the Company in 1999; Vice Chairman and CEO of the Company since 2012       None
Anne Minto       March
2013
      Former Global Human Reources Durector for Centrica plc, former CHRO for Smiths Group plc       Compensation Committee (former Chair through December 2020); Nominating and Governance Committee
Som Mittal       December
2013
      Former Chairman and President of NASSCOM       Compensation Committee; Nominating and Governance Committee
Clyde Ostler       December
2007
      Former executive for Wells Fargo, whose roles included Group Executive Vice President, Chief Financial Officer and Chief Auditor       Audit Committee (Chair); Compensation Committee
Vikram Pandit       October
2018
      Chairman and Chief Executive Officer of Orogen Group; former Chairman of TGG Group and former Chief Executive Officer of Citigroup Inc.       Audit Committee; Nominating and Governance Committee
Kristy Pipes       January
2021
      Former Chief Financial Officer of Deloitte Consulting       Audit Committee; Compensation Committee
Nitin Sahney       January
2016
      Founder and Chief Executive Officer of Pharmacord, LLC; former President and CEO of Omnicare Inc.       Nominating and Governance Committee (Chair); Audit Committee
Jaynie Studenmund       September
2018
      Former Chief Operating Officer of Overture Services, Inc.; former President & Chief Operating Officer, PayMyBills; former Executive Vice President and Head of Consumer and Business Banking for First Interstate of California       Compensation Committee (Chair); Audit Committee

*A complete list of each nominee's business experience and directorships is listed below beginning on page 21.

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2021 PROXY STATEMENT SUMMARY

SUSTAINABILITY

Our corporate culture is rooted in our five core values. In line with our culture, we are committed to sustainability initiatives that are key to our long-term strategy and benefit our stockholders, clients, employees and communities. See "Sustainability" beginning on page 47 below for more details on our recent accomplishments in sustainability.

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2021 PROXY STATEMENT SUMMARY

2020 COMPENSATION HIGHLIGHTS

Named Executive Officers

Name
   
  Title
Rohit Kapoor       Vice Chairman and CEO
Maurizio Nicolelli       Executive Vice President and CFO
Pavan Bagai       President and Chief Operating Officer and Former Interim CFO
Nalin Miglani       Executive Vice President and Chief Human Resources Officer
Vikas Bhalla       Executive Vice President and Business Head, Insurance
Samuel Meckey       Executive Vice President and Business Head, Healthcare

2020 Standard Annual Compensation

Compensation Component
   
  Rohit
Kapoor

   
  Maurizio
Nicolelli

   
  Pavan
Bagai(4)

   
  Nalin
Miglani

   
  Vikas
Bhalla(4)

   
  Samuel
Meckey

 
Salary (1)       $599,016       $384,283       $300,977       $404,631       $229,016       $382,152  
Non-Equity Incentive Plan Compensation       810,000       243,097       200,164       253,125       169,370       239,063  
Equity Awards (2)       5,701,209       1,166,955       1,693,173       1,179,065       1,399,048       1,106,585  
Other Compensation (3)       31,041       133,970       20,132       9,054       43,029       9,054  
Total       $7,141,267       $1,928,305       $2,214,447       $1,845,875       $1,840,463       $1,736,853  

(1) As described in greater detail in the Compensation Discussion and Analysis below beginning on page 61, our named executive officers agreed to a reduction in base salary for four months during fiscal year 2020 in light negative effects of the COVID-19 pandemic.

(2) Equity award values reflect equity grants in 2020 with time-based and revenue linked performance-based restricted stock units valued based on grant date fair market value and TSR linked performance-based restricted stock units valued using a Monte Carlo fair market valuation.

(3) For each named executive officer, this category includes, if applicable, his perquisites and personal benefits, hiring bonus, changes in pension value, Company-paid life insurance premiums and Company contributions to our 401(k) plan. A detailed discussion of the compensation components for each named executive officer for fiscal year 2020 is provided in the "Summary Compensation Table for Fiscal Year 2020" beginning on page 86.

(4) Messrs. Bagai and Bhalla are each based in Delhi, India. Certain of their compensation components, as described herein, are paid in Indian rupees (INR), and are converted for comparison purposes at 73.065 INR to 1 USD, which was the exchange rate on December 31, 2020.

On an annual basis, we submit to our stockholders a vote to approve, on a non-binding advisory basis, the compensation of our named executive officers as described in this proxy statement. We refer to this vote as "say-on-pay". Please refer to our Compensation Discussion and Analysis, beginning on page 61 for a complete description of our 2020 compensation program.

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2021 PROXY STATEMENT SUMMARY

Below are a few highlights of our executive compensation:

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2021 PROXY STATEMENT SUMMARY

Compensation Mix

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OUR BOARD OF DIRECTORS

OUR BOARD OF DIRECTORS

Our board of directors currently consists of 11 directors (including our nine director nominees, and our two directors who are currently serving on the board, but will not stand for reelection) with diverse experience, including in human capital management, corporate sustainability, insurance, healthcare, utilities, consulting, banking and financial services, finance/accounting, global business and technology. The following tables include a summary of our board composition by age, gender, tenure and independence.

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Historically, our board of directors was divided into three classes. Beginning with the Annual Meeting, however, all director nominees elected by our stockholders will be elected to hold office for a term of one year, or until their successors are duly elected and qualified in accordance with our by-laws, and the classification of the Board of Directors will terminate in its entirety.

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OUR BOARD OF DIRECTORS

Upon the recommendation of our Nominating and Governance Committee, we are pleased to propose nine of our existing directors as nominees for election as directors at the Annual Meeting. As previously disclosed, two of our current directors, Ms. Kerr and Mr. Kelso, will not be standing for re-election at the Annual Meeting; the remaining nine directors are our director nominees at the Annual Meeting. Our nominees for re-election as directors at the Annual Meeting are as follows:

DIRECTOR NOMINEES

GRAPHIC   Rohit Kapoor
Vice Chairman and CEO and Director
  GRAPHIC   Vikram Pandit*
Independent Director
GRAPHIC   Anne Minto
Independent Director and Former Chair
of the Compensation Committee
  GRAPHIC   Kristy Pipes
Independent Director
GRAPHIC   Som Mittal
Independent Director
  GRAPHIC   Nitin Sahney
Independent Director and Chair of the
Nominating and Governance Committee
GRAPHIC   Jaynie Studenmund
Independent Director and Chair of the
Compensation Committee
  GRAPHIC   Garen Staglin
Independent Director and
Chair of the Board
GRAPHIC   Clyde Ostler
Independent Director and
Chair of the Audit Committee
       

* Mr. Pandit was appointed to the board as a director under the terms of an Investment Agreement as described on pages 19 to 20 below.

We believe that our director nominees and continuing directors, individually and together as a whole, possess the requisite skills, experience and qualifications necessary to maintain an effective board to serve the best interests of the Company and its stockholders described below under Director Qualifications (see page 12).

In addition to satisfying these general qualifications considered by the Nominating and Governance Committee in connection with a director nomination, Vikram S. Pandit was appointed to the Board on October 4, 2018 as a director pursuant to the terms of an Investment Agreement, dated as of October 1, 2018 (the "Investment Agreement"), between the Company and Orogen Echo LLC (the "Purchaser"), an affiliate of The Orogen Group LLC ("The Orogen Group"). The Investment Agreement was entered into in connection with our issuance to the Purchaser of

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OUR BOARD OF DIRECTORS

$150,000,000 in aggregate principal amount of 3.50% Convertible Senior Notes due October 1, 2024 (the "notes"). For so long as the Purchaser has the right to nominate a director to the Board under the Investment Agreement, we have, subject to the terms of the Investment Agreement, agreed to include such person in our list of nominees for election to our board of directors at each of our annual meetings of stockholders at which directors are to be elected, and to use our reasonable best efforts to cause the election of such person to our board of directors. The Purchaser's right to nominate a director will terminate if Purchaser and its affiliates beneficially own less than 50% of the number of shares of our common stock deemed beneficially owned by the Purchaser and its affiliates immediately following the issuance of the notes (which, for purposes of the Investment Agreement, includes shares of our common stock issuable upon conversion of the notes).

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BOARD OF DIRECTORS

The names, ages and principal occupations (which have continued for at least the past five years unless otherwise indicated) and other information, including the specific experience, qualifications, attributes or skills that led to the conclusion that such person should serve as a director of the Company, with respect to each of the nominees are set forth below. There are no family relationships among any of our directors or executive officers.

Nominees for Election at the Annual Meeting


Rohit Kapoor
Director since November 2002    |    Vice Chairman and CEO since April 2012



Non-Independent

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Age: 56 — co-founded EXL in April 1999 and has served as our Vice Chairman and CEO since April 2012 and as a director since November 2002. He previously served as our President and CEO from May 2008 to March 2012. Mr. Kapoor's business experience and directorships are detailed below. The Company has concluded that, in connection with Mr. Kapoor's experience as a founder and current role as CEO of the Company, Mr. Kapoor should serve as a director.

Committees: N/A

Business Experience at the Company


Vice Chairman and CEO (2012 - present)

President and CEO (2008 - 2012)

Various senior leadership roles, including CFO and COO (2000 - 2008)

Other Business Experience


Business head, Deutsche Bank, a financial services provider (1999 - 2000)

Various capacities at Bank of America in the United States and Asia, including India (1991 - 1999)

Public Directorships During Past Five Years


Director and member of the audit committee and former lead independent director,CA Technologies, Inc., a software services company (NASDAQ: CA) (2012 - 2018)

Other Relevant Experience


Member, Board of Directors, American India Foundation (AIF)

Member, Board of Directors, Pratham (Tristate Chapter)

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Anne E. Minto
Director since March 2013



Independent

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Age: 67 — is a qualified lawyer and member of the Law Society of Scotland. Ms. Minto's business experience and directorships are detailed below. The Company has concluded, based in part on Ms. Minto's extensive experience as a member of international company boards and management in the human resources field and her expertise in human capital management, together with her knowledge and experience of the European business and regulatory environment, that Ms. Minto should serve as a director.

Committees:


Compensation, Nominating and Governance

Business Experience


Qualified lawyer and member of Law Society of Scotland

Group director, human resources and member of the executive committee, Centrica plc, an energy and services company (2002 - 2011)

Prior senior management roles at Shell UK and Smiths Group plc

Public Directorships During Past Five Years


Non-executive director, chairman of the remuneration committee, Tate & Lyle plc, a global provider of specialty food products (LSE: TATE) (2012 - present)

Non-executive director, chairman of the remuneration committee and member of the nomination and governance committee, Shire plc, a global biopharmaceutical company (NASDAQ: SHPG, LSE: SHP) (2010 - 2019)

Other Relevant Experience


Non-executive director, Court of the University of Aberdeen

Chairman, University of Aberdeen Development Trust

Fellow, Chartered Institute of Personnel & Development and the City and Guilds of London Institute

Fellow, Chartered Institute of Management

Recipient, Order of the British Empire for services to the U.K. engineering industry (2000)

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Som Mittal
Director since December 2013



Independent

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Age: 69 — has held various corporate leadership roles in the IT industry since 1989 and has extensive experience in the engineering and automotive sectors. His business experience and directorships are detailed below. The Company has concluded, based in part on Mr. Mittal's business experience as President of NASSCOM, his knowledge of the global outsourcing industry and his expertise in corporate sustainability and responsibility, that Mr. Mittal should serve as a director.

Committees:


Compensation, Nominating and Governance

Business Experience


Chairman and President, NASSCOM, a trade body for the IT and business process management industries in India (2008 - 2014)

Prior leadership roles at Wipro, Digital, Compaq and HP

Prior executive roles at Larsen and Tourbo, Escorts and Denso

Public Directorships During Past Five Years


Director and member of audit and risk management committee, Cyient Ltd., an engineering design services company (NSE:CYIENT) (2014 - present)

Director and chairman of nomination and remuneration committee, Sheela Foam Ltd., a manufacturing company (NSE: SFL) (2016 - present)

Director and chairman of customer service committee and IT strategy committee, member of nomination and remuneration committee and other committees, Axis Bank, Ltd., a financial services company (NSE:Axis) (2011 - 2019)

Other Directorships


Director, Tata SIA Airlines, Ltd., an Indian airline joint venture between TATA and Singapore Airlines with Indian and international operations (2015 - present)

Non executive Independent Director and Chairman, Vodafone India Services India Pvt Ltd., an Indian shared services company that is wholly owned, operated and controlled by Vodafone Group Plc ("Vodafone") and provides information technology and networks services, among others, to Vodafone (2020 - present)

Other Relevant Experience


Former member, Board of Governors, Indian Institute of Corporate Affairs

Former Committee Member, Indian Prime Minister's National e-Governance Program

Member of the governing body of Axis Bank Foundation, a non-profit organization, and member of board of governors of academic institutions

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Clyde W. Ostler
Director since December 2007



Independent

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Age: 74 — is a retired executive of Wells Fargo and during his 40-year tenure held numerous senior leadership positions within that organization. The Company has concluded, based in part on Mr. Ostler should serve as a director.

Committees:


Audit (Chair)*, Compensation

Business Experience


Leadership positions within Wells Fargo, including: Group Executive Vice President, Wells Fargo & Co., Vice Chairman, Wells Fargo Bank California NA, President, Wells Fargo Family Wealth, Vice Chairman in the Office of the President, Chief Financial Officer, Chief Auditor, Head of Retail Branch Banking, Head of Information Technology, Head of Institutional and Personal Investments and Head of Internet Services

Served on the Senior Management Committee of Wells Fargo for over 25 years

Public Directorships During Past Five Years


Director, McClatchy Company, a media company (NYSE: MNI) (2013 - 2020)

Other Directorships


Advisory Director Emeritus, FTV Capital, a private global investment company

Other Relevant Experience


Director's Advisory Council, Scripps Institution of Oceanography

* Audit committee financial expert under applicable SEC rules and regulations.

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Vikram S. Pandit
Director since October 2018



Independent

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Age: 64 — is Chairman and Chief Executive Officer of The Orogen Group, which makes significant long-term strategic investments in financial services companies and related businesses. Mr. Pandit's business experience and directorships are detailed below. Mr. Pandit was appointed to the Board pursuant to the terms of the Investment Agreement. The Company has concluded, based in part on Mr. Pandit's more than 30 years of experience in the financial services industry, including his experience as Chief Executive Officer and a member of the board of directors of Citigroup Inc. (NYSE: C), that Mr. Pandit should serve as a director.

Committees:


Audit; Nominating and Governance

Business Experience


Chairman and Chief Executive Officer, The Orogen Group LLC (July 2016 - present)

Chairman, TGG Group (February 2014 - June 2016)

Chief Executive Officer, Citigroup Inc. (December 2007 - October 2012)

Public Directorships During Past Five Years


Director and member of the nominating and governance and finance committees, Virtusa Corporation (NASDAQ: VRTU) (2017 - 2021)

Lead Independent Director, chair of the human resources and compensation committee and member of the corporate governance and nominating committee, former member of the audit committee, Bombardier Inc. (TSX: BBD) (2014 - present)

Other Relevant Experience


Director, Citigroup Inc. (December 2007 - October 2012)

Chairman, Fair Square Financial Holdings (2017 - present)

Director, Westcor Land Title Insurance Company (2020 - present)

Chairman, JM Financial Credit Solutions Ltd. (2014 - present)

Member of the Board of Overseers of Columbia Business School

Member of the Board of Visitors of Columbia School of Engineering

Member of the Board of Trustees of Columbia Business School until 2016

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Kristy Pipes
Director since January 2021



Independent

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Age: 61 — is a leader in the consulting and financial services industry. Ms. Pipes's business experience and directorships are detailed below. The Company has concluded, based in part on Ms. Pipes's experience as the Chief Financial Officer and as a member of the Management Committee of Deloitte Consulting, LLP and her expertise in the consulting and financial services industry that Ms. Pipes should serve as a director.

Committees:


Audit; Compensation

Business Experience


Chief Financial Officer, member of the Management Committee and various leadership positions, Deloitte Consulting LLP, a management consulting firm (1999 - 2019)

Vice President and Manager, Finance Division, Transamerica Life Companies (1997 - 1999)

Senior Vice President and Chief of Staff for the President and CEO, among other senior management positions, First Interstate Bank of California (1985 - 1996)

Public Directorships During Past Five Years


Director and chair of the audit committee, and member of the nominating/corporate governance committee, PS Business Parks, Inc. (NYSE: PSB), a commercial property real estate investment trust (2019 - present)

Director and chair of the audit committee, and member of the nominating/corporate governance committee, Public Storage (NYSE: PSA) an international self storage company (2020 - present)

* Audit committee financial expert under applicable SEC rules and regulations.

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Nitin Sahney
Director since January 2016



Independent

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Age: 58 — Is a leader in the healthcare industry with over 25 years of experience across all areas of healthcare. Mr. Sahney's business experience and directorships are detailed below. The Company has concluded, based in part on Mr. Sahney's experience as CEO of Pharmacord and Omnicare, Inc. and his expertise in the healthcare industry garnered from more than two decades of experience, that Mr. Sahney should serve as a director.

Committees:


Nominating and Governance (Chair), Audit

Business Experience


Founder, Member-Manager and Chief Executive Officer, Pharmacord, LLC, a company that helps biopharma manufacturers address product access hurdles (2016 - present)

Operating Advisor, Clayton Dubilier & Rice Funds, a private equity firm (2016 - 2017)

President and CEO (2014 - 2015) and President and COO (2012 - 2014) of Omnicare Inc., a former New York Stock Exchange-listed Fortune 500 company in the long-term care and specialty care industries

Manager of a healthcare investment fund (2008 - 2010)

Founder and CEO of RxCrossroads, a specialty pharmaceutical company (2001 - 2007)

Prior leadership positions with Cardinal Healthcare, a global healthcare services and products company

Public Directorships During Past Five Years


Director, Option Care Enterprises, Inc. (NASDAQ: OPCH) (2019 - present)

Other Relevant Experience


Member of the Board of Trustees, University of Louisville (2017 - 2019)

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Garen K. Staglin
Director since June 2005    |    Chairman of the Board since February 2014



Independent

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Age: 76 — has over 45 years of experience in the financial services and technology industries. Mr. Staglin's business experience and directorships are detailed below. The Company has concluded, based in part on Mr. Staglin's experience in the financial services and technology industries and his past experience as a member of public company boards of directors, that Mr. Staglin should serve as a director.

Committees:


Compensation, Nominating and Governance

Business Experience


Chief Executive Officer of eONE Global LP, an emerging payments company (2001 - 2004)

Chief Executive Officer of Safelite Auto Glass, a provider of glass claim solutions (1993 - 1999)

Public Directorships During Past Five Years


Director, chairman of the compensation and member of the governance and risk committees, SVB Financial Group (NASDAQ:SIVB), a financial services provider (2011 - present)

Other Directorships


Senior Advisor and Advisory Director, FTV Capital, a private global investment company (2004 - present)

Vice Chairman, Profit Velocity Solutions, a manufacturing analytics firm (2007 - present)

Chairman, Nvoicepay, Inc. an electronic payment service provider (2010 - 2019)

Advisory Director, Specialized Bicycle, a manufacturer of cycling equipment (1995 - 2014)

Other directorships completed prior to 2015 include: Bottomline Technologies, a provider of payment and invoice automation software and services (2007 - 2012); Solera Holdings, a public automotive insurance software service provider (2005 - 2011); First Data Corporation, a payments solutions provider (1992 - 2003); and Global Document Solutions, a private document processing outsourcing company (2005 - 2010).

Other Relevant Experience


Co-Founder and Co-Chairman, One Mind (1995 - present)

Founder and Co-Chairman, Healthy Brains Financing Initiative (2019 - present)

Member of the Stewardship Board, World Economic Forum (2019 - present)

Co-Chairman, UCLA Centennial Capital Campaign (2014 - 2019)

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Jaynie M. Studenmund
Director since September 2018



Independent

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Age: 66 — is a seasoned executive with significant experience as a top line executive leading financial services and digital companies. She also has extensive experience as a public company director. Ms. Studenmund's business experience and directorships are detailed below. The Company has concluded, based in part on Ms. Studenmund's extensive public company board experience, together with her knowledge and experience in the digital, financial services, health care and consumer business sectors, and her expertise in compensation and corporate governance, that Ms. Studenmund should serve as a director.

Committees:


Compensation (Chair), Audit*

Business Experience


Chief Operating Officer, Overture Services, a pioneer in paid search and search engine marketing (2001- 2004)

President & Chief Operating Officer, PayMyBills, the leading consumer bill payment and presentment company (1999 - 2001)

Previously for over two decades served as Executive Vice President and Head of Consumer and Business Banking for three of the nation's largest banks at the time and primarily for First Interstate of California. Today, these three banks form the backbone of Chase's and Wells Fargo's consumer business in California following the era of bank consolidation.

Other Relevant Experience


Director and chair of the compensation committee and member of the risk management committee, Pacific Premier Bancorp (Nasdaq: PPBI) (2019 - present)

Director and chair of the compensation committee and member of the nomination and governance committee, CoreLogic, Inc. (NYSE: CLGX) (2012 - present)

Director and member of the contracts committee, audit committee and nomination and governance committee, Western Asset Management funds (2004 - present), a major global fixed income fund, and director of affiliated funds for Western Asset Management

Director, compensation committee chair and member of the compliance committee, Pinnacle Entertainment (Nasdaq: PNK) until its acquisition in 2018 (2012 - 2018)

Director, compensation committee chair and member of the audit committee, Lifelock (Nasdaq: LOCK) until its acquisition in 2017 (2015 - 2017)

Other Relevant Experience


Board Leadership Fellow, National Association of Corporate Directors

Life trustee and board chair, Huntington Hospital

Founder and board member, Enduring Heroes Foundation

* Audit committee financial expert under applicable SEC rules and regulations.

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CORPORATE GOVERNANCE

CORPORATE GOVERNANCE

DIRECTOR INDEPENDENCE

In determining director independence, the board of directors considered the transactions and relationships set forth below under "Certain Relationships and Related Person Transactions — Related Party Transactions" and routine service arrangements between the Company and each of Fair Square Financial ("FSF") and Virtusa Corporation ("Virtusa"). During fiscal year 2020, one of our directors, Mr. Pandit, served as a non-executive director and, through his ownership in The Orogen Group (see below for information on Mr. Pandit's relationship with The Orogen Group), owned an immaterial indirect equity interest, in each of FSF and Virtusa; Mr. Pandit is not a partner, controlling shareholder or executive officer of either FSF or Virtusa. Based on its review of all applicable relationships, our board of directors has determined that all of the members on our board of directors, other than Mr. Kapoor, meet the independence requirements of the Nasdaq Stock Market and federal securities laws.

MEETING ATTENDANCE

We expect our directors to attend all board of directors meetings and meetings of committees on which they serve. We also expect our directors to spend sufficient time and meet as frequently as necessary to discharge their responsibilities properly. Each director attended at least 75% of the aggregate meetings of our board of directors and the committees on which they served during 2020. It is our policy that all of our directors should attend our Annual Meetings of Stockholders absent exceptional cause, and all of our then-incumbent directors attended the 2020 Annual Meeting of Stockholders.

Board and Committee Meetings in 2020

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CORPORATE GOVERNANCE FRAMEWORK

The board is responsible for providing governance and oversight over the effectiveness of policy and decision-making with respect to the strategy, operations and management of EXL, in order to enhance our financial performance and stockholder value over the long term.

Our board's commitment to strong corporate governance is informed by the five core values of our corporate culture: innovation, respect, integrity, excellence and collaboration. Our board seeks to maintain best practices in corporate governance by reviewing and updating our governance policies, as appropriate, at least annually, and provides oversight over our risk management and strategic planning, as relates to our growth, human capital management, and environmental, social and governance matters, each as discussed further below.

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CORPORATE GOVERNANCE

BEYOND THE BOARD ROOM

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BOARD LEADERSHIP STRUCTURE

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Our board of directors is currently led by Garen K. Staglin, our Chairman, and Rohit Kapoor, our Vice Chairman and CEO.

Our by-laws provide that our Chairman or, in the absence of our Chairman, our Lead Director (if there is a Lead Director serving at such time), or in the absence of both our Chairman and Lead Director, our CEO, calls meetings of our board of directors to order and acts as the chairman for those board meetings. In the absence of our Chairman, our Lead Director (if there is a Lead Director serving at such time), and our CEO, a majority of our directors present may elect as chairman of the meeting any director present. Independent directors meet at least quarterly in executive session without any management directors or members of the Company's management present. Our Corporate Governance Guidlines provide that in the absence of our Chairman, our Lead Director (if there is a Lead Director serving at such time) or, in the absence of the Lead Director, a director chosen by the directors meeting in executive session, presides at all executive sessions.

Consolidating the Vice Chairman and CEO positions allows our CEO to contribute his experience and perspective regarding management and leadership of the Company towards the goals of improved corporate governance and greater management accountability. In addition, the presence of our Chairman ensures that the board can retain sufficient delineation of responsibilities, such that our Chairman and our Vice Chairman and CEO may each successfully and effectively perform and discharge their respective duties and, as a corollary, enhance our prospects for success. As a result, the Company will benefit from the ability to integrate the collective leadership and corporate governance experience of our Chairman and our Vice Chairman and CEO, while retaining the ability to facilitate the functioning of the board of directors independently of our management and to focus on our commitment to corporate governance.

For the foregoing reasons, our board of directors has determined that its leadership structure is appropriate and in the best interests of our stockholders at this time.

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CORPORATE GOVERNANCE

DIRECTOR QUALIFICATIONS, REFRESHMENT AND EVALUATIONS

Director Qualifications

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The board of directors considers it paramount to achieving excellence in corporate governance to assemble a board of directors that, taken together, has the breadth of skills, qualifications, experience and attributes appropriate for functioning as the board of directors of our Company and working productively with management. The Nominating and Governance Committee of the board is responsible for recommending nominees who are qualified and bring a diverse set of skills and qualifications to oversee the Company effectively.

The Nominating and Governance Committee has not formally established any minimum qualifications for director candidates, but pursuant to our Corporate Governance Guidelines, our board of directors seeks members from diverse professional and personal backgrounds who combine a broad spectrum of experience and expertise with a reputation for integrity. The Nominating and Governance Committee assesses each director candidate's independence, diversity (including age, ethnicity, race and gender, among others), skills and experience in the context of the needs of the board of directors. The Nominating and Governance Committee considers a number of factors in selecting director candidates, including, among others: ethical standards and integrity; independence; diversity of professional and personal backgrounds; skills and experience; other public company directorships; and financial literacy and expertise; communication skills; and ability and willingness to comply with Company policies and procedures.

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CORPORATE GOVERNANCE

In light of our business, the primary areas of experience, qualifications and attributes typically sought and put forward by the Nominating and Governance Committee in director candidates include, but are not limited to, the following:

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CORPORATE GOVERNANCE

REFRESHMENT

Our Nominating and Governance Committee regularly considers the size and composition of our board on a continual basis with an aim toward creating a balanced board with extensive experience and institutional knowledge, and fresh perspective and insight.

Considerations include whether the composition of the board of directors includes sufficient diversity and independent skill sets and background as appropriate for our immediate and long-term strategic needs. These considerations are also informed by discussions with our investors through stockholder engagement. In terms of diversity, our board is 57% diverse in terms of gender and 57% diverse in terms of ethnic/racial diversity.

 

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In considering board composition, our Nominating and Governance Committee also considers the length of tenure of the directors as a whole. Over the past four years, we have added three new directors, and following the Annual Meeting, will have the following balance of tenures:

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While the Company does not maintain term limits, our Corporate Governance Guidelines provide that the expectations for new directors is a maximum term of ten years. The board actively manages board refreshment and succession planning. The board expects that over the next few years, three to four longer tenured directors may retire. The Nominating and Governance Committee will identify successors based on the goal of maintaining the board's overall balance of experience and perspective. A recommendation regarding board composition is shared with the full board of directors on an annual basis.

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CORPORATE GOVERNANCE

Board Refreshment Process:

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CORPORATE GOVERNANCE

Board Evaluations

We consider the continued effectiveness of the board and its committees as critical to our long-term success and stockholder value. The board evaluates its performance and the performance of it committees and each director on an annual basis through the following process:

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COMMITTEES

Our board of directors currently has three standing committees: the Audit Committee, the Nominating and Governance Committee and the Compensation Committee. As discussed above, our board of directors has determined that each member of the Audit, Nominating and Governance and Compensation Committees meets the independence and experience requirements of the Nasdaq Stock Market and federal securities laws. Copies of our committee charters can be found on the Investor Relations page of our website at: https://ir.exlservice.com/corporate-governance. Information on our website referred to in this proxy statement does not constitute a part of this proxy statement.

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CORPORATE GOVERNANCE

The following table sets forth the current chairs and members of each standing committee of the board of directors.

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CORPORATE GOVERNANCE

Audit Committee

Our Audit Committee oversees and assists our board of directors in fulfilling its oversight responsibilities with respect to our accounting and financial reporting processes, including the integrity of the financial statements and other financial information provided by us to our stockholders, the public, stock exchanges and others; our compliance with legal and regulatory requirements; our independent registered public accounting firm's qualifications and independence; the audit of our financial statements; the performance of our internal audit function and independent registered public accounting firm; and the Company's cyber security program and cyber strategy-related risks. Our Audit Committee's risk oversight is discussed below beginning on page 43. Our Audit Committee charter permits the committee to form and delegate authority to subcommittees when appropriate, provided that the subcommittees are composed entirely of directors who satisfy the applicable requirement of federal securities laws as well as independence requirements of the Nasdaq Stock Market.

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Our Audit Committee has direct responsibility for the appointment, compensation, retention (including termination) and oversight of our independent registered public accounting firm, and our independent registered public accounting firm reports directly to our Audit Committee. Our Audit Committee also reviews and approves specified related-party transactions as required by the rules of the Nasdaq Stock Market, and oversees the Company's cyber security program and cyber strategy-related risks. The Audit Committee was established in accordance with Section 3(a)(58)(A) of the Securities Exchange Act of 1934 (the "Exchange Act"). Our Audit Committee annually reviews and assesses the adequacy of the Audit Committee charter and its own performance.

The members of our Audit Committee are appointed by our board of directors. All members of our Audit Committee must also be recommended by our Nominating and Governance Committee.

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CORPORATE GOVERNANCE

Nominating and Governance Committee

Our Nominating and Governance Committee is responsible for: (i) identifying and recommending candidates for election to our board of directors using selection criteria approved by our board of directors and overseeing board refreshment, and committee membership, (ii) developing and recommending to our board of directors Corporate Governance Guidelines and other board procedures that are applicable to us, (iii) overseeing our board of director and management evaluations and our director education program, and (iv) overseeing our ESG goals, policies and practices. Our Nominating and Governance Committee Charter permits the committee to form and delegate authority to subcommittees when appropriate, provided that the subcommittees are composed entirely of directors who satisfy the applicable independence requirements of the Nasdaq Stock Market. Until December 31, 2020, Mr. Kelso was the chair of the Nominating and Governance Committee. Mr. Sahney became the chair of the Nominating and Governance Committee on January 1, 2021.

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Our Nominating and Governance Committee reviews written and oral information provided by and about candidates and considers any additional criteria it feels is appropriate to ensure that all director nominees possess appropriate skills and experience to serve as a member of our board of directors.

Aside from its role in assessing the board, its committees and individual director effectiveness described above, our Nominating and Governance Committee, together with the Compensation Committee, provides annual reports on our CEO's performance in respect of certain goals and objectives set by the Nominating and Governance Committee and the board. Pursuant to its charter, the Nominating and Governance Committee is responsible for developing, annually reassessing and making recommendations to the board with respect to succession plans for our CEO and other key executive officers of the Company, and preparing contingency plans for interim CEO succession in the event of an unexpected occurrence for board review.

The Nominating and Governance Committee also oversees our director onboarding and training program, which provides new directors with training regarding the Company's policies and procedures and specific requirements that may be needed based on the director's committee memberships.

In addition, the Nominating and Governance Committee oversees and reviews the Company's ESG goals, policies and programs and the Company's corporate governance policies and practices regularly. Our Nominating and Governance Committee annually reviews and assesses the adequacy of the Nominating and Governance Committee charter and its own performance. The members of our Nominating and Governance Committee are appointed by our board of directors.

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CORPORATE GOVERNANCE

Compensation Committee

Our Compensation Committee reviews and recommends policies relating to compensation and benefits of our directors, officers and employees and is responsible for approving the compensation of our Vice Chairman and CEO and other executive officers. Our Compensation Committee also reviews, evaluates and makes recommendations to our board of directors with respect to our incentive compensation plans and equity-based plans and administers the issuance of awards under our equity incentive plans. Our Compensation Committee charter permits the committee to form and delegate authority to subcommittees when appropriate, provided that the subcommittees are composed entirely of directors who satisfy the applicable independence requirements of the Nasdaq Stock Market. Until December 31, 2020, Ms. Minto was the chair of the Compensation Committee. Ms. Studenmund became the chair of the Compensation Committee on January 1, 2021.

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Our Compensation Committee charter also permits the committee to retain advisors, consultants or other professionals to assist the Compensation Committee to evaluate director, Vice Chairman and CEO or other senior executive compensation and to carry out its duties. For 2020, our Compensation Committee retained the services of Frederick W. Cook & Co., Inc. ("FW Cook"), a qualified and independent compensation consultant, to aid the Compensation Committee in performing its review of executive compensation including executive compensation benchmarking and peer group analysis. Our Compensation Committee also provides oversight with respect to diversity and equity matters as relate to compensation, including pay equity. Our Compensation Committee annually reviews and assesses the adequacy of the Compensation processes and procedures for considering executive compensation are addressed in the Compensation Discussion and Analysis below.

The members of our Compensation Committee are appointed by our board of directors. All new members of our Compensation Committee must be recommended by our Nominating and Governance Committee.

During 2020, none of our executive officers served as a member of the board of directors or compensation committee of any entity that has one or more executive officers who serve on our board of directors or Compensation Committee.

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CORPORATE GOVERNANCE

BOARD AND COMMITTEE OVERSIGHT OF RISK MANAGEMENT

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CORPORATE GOVERNANCE

Cybersecurity Risk Management

We maintain a comprehensive program that focuses on information security, cybersecurity, data privacy and the protection of our clients' and their customers' confidential personal and sensitive information. Our Audit Committee has primary oversight and receives presentations throughout the year on cybersecurity-related risks and vulnerabilities and strategic policies and practices from management. At least once a year, the full board receives a report from management on the Company's readiness and capability to prevent, detect and respond to a cyber-attack.

We have invested in our information security and cyber security posture and protocols to support compliance with our contractual obligations and the laws and regulations governing our activities. These investments include people, processes and technology intended to protect information throughout its life cycle. Each of our employees receives and must pass annual, mandatory knowledge and awareness training and testing on risk mitigation and management and controls and procedures relating to information security, cybersecurity and data privacy.

EXL focuses on implementing and maintaining cybersecurity capabilities to identify, protect, detect, respond and recover from cyber threats, incidents and attacks; reduce vulnerabilities and minimize the impact of cyber incidents. We emphasize compliance and institutional governance built upon and supported by policies and processes, tools and technologies, and knowledge and awareness training. EXL takes into account guidance from relevant regulatory and governance bodies. For more details on our cybersecurity program, see "Sustainability — Cybersecurity at EXL" on page 56.

Environmental, Social and Governance ("ESG") Risk Management

Our board reviews and receives regular reports on ESG and sustainability risks, including those relating to employee safety, environmental-related efforts, human capital management matters, and corporate governance trends and best practices.

While the Nominating and Governance Committee is responsible for overseeing our risk management related to ESG matters generally, the other board Committees share in the responsibility with respect to certain matters within their purview. The Compensation Committee deals with certain human capital management matters relating to employee compensation and benefits, and the Audit Committee is involved in regulatory risks touching on ESG matters.

In 2021, we established a new management-level ESG steering committee, which is responsible for setting our sustainability/ESG strategy and risk management, keeping our management and board up-to-date on ESG-related developments, overseeing our internal and external disclosure on ESG matters, and providing implementation support across our Company. The ESG steering committee works in close coordination with the board, and provides the board with advice and assistance in its oversight of ESG risks and other matters. For more details on our ESG and sustainability-related efforts, see "Sustainability" on page 47.

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CORPORATE GOVERNANCE

Stockholder Engagement

Our formal governance-focused stockholder outreach program commenced in late 2020, which we plan to take forward and expand in future years.

As of the date hereof, we offered to meet with stockholders representing approximately 55% of shares outstanding for discussions focusing on governance topics, and engaged with all stockholders that accepted our invitation, representing nearly 22% of shares outstanding. EXL was represented by our management, members of our legal and investor relationships teams, and board members at these meetings. One of our independent directors, Mr. Pandit, attended meetings with stockholders representing nearly 19% of shares outstanding.

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Topics discussed included:

EXL also regularly interacts and shares information with our stockholders through our quarterly earnings calls, investor meetings, SEC filings and publications on our website, among others.

The feedback received from our stockholders is shared with and reviewed by our board, which is used to inform and focus our decisions relating to our governance and sustainability practices and to improve our disclosure.

Communications with the Board

Stockholders interested in contacting our board of directors, our Chairman or any individual director are invited to do so by writing to:

Board of Directors of ExlService Holdings, Inc.
c/o Corporate Secretary
ExlService Holdings, Inc.
320 Park Avenue, 29th Floor
New York, New York 10022

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CORPORATE GOVERNANCE

All other stockholder communications addressed to our board of directors will be referred to our Chairman and tracked by our Corporate Secretary. Stockholder communications specifically addressed to a particular director will be referred to that director.

Complaints and concerns relating to our accounting, internal accounting controls or auditing matters should be communicated to our Audit Committee, which consists solely of non-employee directors. Any such communication may be anonymous and may be reported to our Audit Committee through our General Counsel by writing to:

Audit Committee of the Board of Directors
ExlService Holdings, Inc.
320 Park Avenue, 29th Floor
New York, New York 10022
Attn: General Counsel

All such concerns will be reviewed under Audit Committee direction and oversight by our General Counsel, our Head of Internal Audit or such other persons as our Audit Committee determines to be appropriate. Confidentiality will be maintained to the fullest extent possible, consistent with the need to conduct an adequate review. Prompt and appropriate corrective action will be taken when and as warranted in the judgment of our Audit Committee. We prepare periodic summary reports of all such communications for our Audit Committee.

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SUSTAINABILITY

SUSTAINABILITY

In line with our mission of digging deeper to find a better way for our clients, at EXL we are committed to doing our part as a global citizen to build a better future for us all by operating in a responsible and sustainable manner. We believe that by integrating sustainable practices into our business model, working toward positive social change, and providing transparent reporting on those practices and our progress, we will best able to deliver long-term value to our stockholders while promoting and developing our business, people, communities and the world around us.

Recent Activities

In 2020 and continuing into 2021, we have taken a number of steps to continue improving and formalizing our sustainability program. These recent activities include:

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SUSTAINABILITY

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We support our employees' charitable efforts by enabling payroll giving, recognizing social impact through individual, geography and business unit awards, organizing social responsibility events in each region in which we operate and creating "volunteer weeks" that our employees can use for volunteer efforts.

We partner with non-profits and our clients to support corporate social responsibility initiatives, in education and skills, global health and disaster relief.

In 2020, we additionally focused on COVID-19 relief-related contributions through a global network of partners across seven of the countries in which we operate, reaching approximately 78,000 beneficifiaries.

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SUSTAINABILITY

Protecting our Planet

At EXL, we endeavor to keep the environmental impact of our operations to a minimum. We strive to continuously improve in our environmental stewardship, with a focus on energy conservation, minimizing waste, and developing green infrastructure and operations, all in order to reduce our carbon footprint across our global operations.

We have committed ourselves to year-on-year targets for reducing our environmental footprint our baseline numbers. We began this process in 2017, with respect to our India and Philipplines operations only, and began recording data and applying our year-on-year targets to our global operations using 2019 as a baseline. The targets, and our progress through 2019 with respect to our India and Philippines operations are as stated in the following table. We expect to report our global progress in our 2020 Annual Sustainability Report to be published during 2021.

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SUSTAINABILITY

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These goals are assessed by our Environment, Health and Safety team periodically, as well as third-party experts, and our progress is reported to our ESG steering committee, management and board for review. We report our progress toward these goals annually in our Annual Sustainability Report.

Sustainable Supply Chain

We conduct background investigations of all of our new suppliers to collect information on their policies and performance relating to economic and environmental matters, as well as human rights, data privacy, product safety and working conditions. Through our Supplier Standards of Conduct, we maintain the right to review our suppliers' practices in the future.

We seek to procure our materials from local suppliers, to the extent feasible.

Our supplier diversity programs ensure that suppliers of diverse backgrounds can participate in our procurement sourcing process and encourages engagement with suppliers owned by people belonging to minority groups, women, the gay, lesbian, bisexual and transgender community, and veterans, specially-abled people, and small business enterprises.

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SUSTAINABILITY

Supporting and Developing our People

Our people are our primary assets. The world we work and live in is full of diversity and powered by innovation. We believe success in such a world will come through an environment that embraces diversity of thought. In line with our core values, one of our principal priorities is promoting the talent of our employees while creating an inclusive work environment to permit us to leverage our employees' diversity and to deliver exceptional results for our clients. We have an active employee relations function to ensure that we regularly communicate with and understand our employees, and are able to swiftly respond to specific needs and concerns as they arise. We periodically conduct employee surveys to monitor our employee satisfaction and engagement, and take actions to address the results of such surveys.

EXL is made up of approximately 31,600 professionals (as of March 31, 2021) in locations throughout the United States, the United Kingdom, Europe, India, the Philippines, Colombia, Canada, Australia and South Africa.

EXL Locations

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SUSTAINABILITY

Diversity, Equity and Inclusion

Our Diversity and Inclusion Council consists of a global, diverse mix of leaders, provides inputs to the design of our diversity and inclusion program to bring in diverse perspectives, collaborates with external partners for customization inputs, conducts periodic reviews of the progress of our program and provides execution leadership for specific diversity initiatives.

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SUSTAINABILITY

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We have institutionalized a comprehensive set of practices, processes and programs to create an active learning culture and to build market-relevant talent within our Company in four stages:

Our capability development framework is focused on developing our employees' digital and domain expertise and leadership as a means to develop our talent internally. We do this through our learning academies, and through partnerships with industry organizations, institutes, business schools and consulting firms. In 2020, in light of COVID-19, we introduced a new capability ecosystem to deliver learning virtually from any location, at any time.

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SUSTAINABILITY

Academies

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2020 Training

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SUSTAINABILITY

Benefits

GRAPHIC   Enhanced leave for employees impacted by COVID-19 and for employees receiving COVID-19 vaccines

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Paid leave for U.S. new parents

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Excused days of absence

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Generous vacation policy

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Paid holidays

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Employee Assistance Program providing confidential counseling services

Our employees also participate in our success:

GRAPHIC   Annual bonuses or incentives: 100% of our employees are eligible to receive

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401K plans with Company match: 100% of our U.S. employees are eligible to enroll within three months of their employment at EXL

Employee Health and Safety

In 2020, given COVID-19, approximately 92% of our employees worked from home. We took actions that focused on helping our employees, including:

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SUSTAINABILITY

Cybersecurity at EXL

We are committed to protecting the confidentiality, integrity, availability and privacy of the information assets of our clients and their customers, as well as our employees, vendors and any other third parties, that are provided to us and for which we are responsible and have developed robust information security and cybersecurity and data privacy controls, safeguards and enabling measures in accordance with applicable laws and regulations and information security standards.

We have implemented and maintain, and regularly improve upon, tools and capabilities to identify, protect, detect, respond and recover from cyber threats, incidents and attacks; reduce vulnerabilities; and minimize the impact from cyber incidents. We have an established culture of compliance around cybersecurity matters, and have a strong governance program built upon and supported by policies and processes, tools and technologies, and periodic knowledge and awareness training. Each of our employees receives and must pass annual, mandatory periodic knowledge and awareness training and testing on risk mitigation and management and controls and procedures relating to information security, cybersecurity and data privacy.

We comply with and/or are certified in the following standards:

SO 27001:2013
Global Information
Security Standard —
Company-wide
  PCI DSS 3.2.1
Credit Card and
Payment Industry
Certification — India,
Philippines and South
Africa operations
  SOX 404 / SSAE 16,
SOC 1 and SOC 2 —
Company-wide
  Hitrust Certification —
healthcare operations
  ISO22301
Business Resiliency
Certification — India,
Philippines and South
Africa operations

For more information on our cybersecurity risk management, please see "Cybersecurity Risk Management" on page 44. For more information on our information security and data privacy procedures, please refer to our Sustainability Report, which is available on our website at www.exlservice.com/corporate-sustainability.

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SUSTAINABILITY

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SUSTAINABILITY

Environmental, Social and Governance Matters and Pay-for-Performance at EXL

A portion of our CEO's total compensation is tied to the achievement of specific performance goals relating to ESG matters. For more information, see "Detailed Review of Compensation Components — Incentive Bonus — Determination of Individual Performance Measure Achievement" on page 78.

Sustainability Oversight

For more information on our oversight of sustainability and ESG-related matters and risks, see "Environmental, Social and Governance Risk Management" on page 44.

Learn More about Sustainability and Environmental, Social and Governance Matters at EXL

Please visit www.exlservice.com/corporate-sustainability to learn more about our efforts toward sustainability and the impacts we are making on our communities and the environment. Information on our website referred to in this proxy statement does not constitute a part of this proxy statement.

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OUR EXECUTIVE OFFICERS

OUR EXECUTIVE OFFICERS

GRAPHIC Rohit Kapoor (age 56) | Vice Chairman and CEO
See section entitled "Our Board of Directors" above.

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Ajay Ayyappan (age 43) | Senior Vice President, General Counsel and Corporate Secretary
Mr. Ayyappan has served as our Senior Vice President, General Counsel and Corporate Secretary since December 2018 and our Vice President, Acting General Counsel and Corporate Secretary since August 2018. He previously served as Vice President, Deputy General Counsel and Assistant Secretary from April 2014 to August 2018 and Vice President and Assistant General Counsel from March 2007 to March 2014. Prior to joining us, Mr. Ayyappan was a corporate associate at the law firm of Morgan, Lewis & Bockius LLP.

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Pavan Bagai (age 59) | President and Chief Operating Officer
Mr. Bagai has served as our President and Chief Operating Officer since April 2012, as our Chief Operating Officer from May 2008 to March 2012 and as Vice President, Head of Outsourcing Services of EXL India from June 2006 until April 2008. In addition, he served as our interim Chief Financial Officer from December 2019 through February 2020. He previously served as Vice President, Research and Analytics of EXL India from December 2004 to May 2006, as Vice President, Operations of EXL India from November 2003 to November 2004 and as Vice President, Strategic Businesses of EXL India from July 2002 to November 2003. Prior to joining us, Mr. Bagai served in various capacities in several business areas across markets in Europe and Asia, including India, at Bank of America beginning in 1985. Mr. Bagai is based in Delhi, India. On April 16, 2021, Mr. Bagai notified the Company that he will be retiring effective October 1, 2021.

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Vikas Bhalla (age 49) | Executive Vice President and Business Head, Insurance
Mr. Bhalla has served as our Executive Vice President and Business Head, Insurance since January 2014 and as our Head of Outsourcing since November 2009. He previously served as Vice President, Operations of EXL India from June 2006 to October 2009 and as Vice President, Migrations, Quality and Process Excellence of EXL India from April 2002 to June 2006 and as Director, Quality Initiatives of EXL India from May 2001 to March 2002. From May 1998 to May 2001, Mr. Bhalla served in various capacities at General Electric, including as the Quality Leader and E-Business Leader for GE Plastics India. Mr. Bhalla is based in Delhi, India.

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OUR EXECUTIVE OFFICERS

GRAPHIC Vivek Jetley (age 46) | Executive Vice President and Business Head, Analytics
Mr. Jetley has served as our Executive Vice President and Business Head, Analytics since January 2020. He previously served in various leadership roles with us, including heading enterprise strategy and setting up a strategic deal team. Mr. Jetley has been with EXL since 2006. Prior to joining us, Mr. Jetley was a Partner at Inductis.

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Anita Mahon (age 52) | Executive Vice President and Chief Growth Officer
Ms. Mahon has served as our Executive Vice President and Chief Growth Officer since March 2020. Prior to joining us, Ms. Mahon served as Vice President, Data, Strategy & Portfolio Officer at IBM Watson Health, a business unit focused on developing cognitive and data-driven technologies to advance health. Ms. Mahon joined IBM in 2016 through its acquisition of Truven Health Analytics, a healthcare information and analytics business, where she served as Chief Strategy Officer. Prior to Truven, she held other leadership roles that placed her at the intersection of strategy, technology and analytics.

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Samuel Meckey (age 50) | Executive Vice President and Business Head, Healthcare
Mr. Meckey has served as an Executive Vice President since November 2018 and as Business Head, Healthcare beginning in 2019. Prior to joining us, Mr. Meckey served as President of UnitedHealth Group's Optum Global Solutions and before that has held various executive roles at UnitedHealth Group, where he was employed from May 2004 to June 2018. Prior to joining UnitedHealth Group, Mr. Meckey was an officer and naval aviator in the United States Navy from May 1992 to August 2002.

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Nalin Miglani (age 60) | Executive Vice President and Chief Human Resource Officer
Mr. Miglani has served as our Executive Vice President, Chief Human Resource Officer since December 2014. Mr. Miglani is responsible for the global human resources function at the Company. Prior to joining the Company, he was the Chief HR and Corporate Development Officer for Nutreco, based in Amsterdam, Netherlands, from March 2013 to November 2014. Mr. Miglani also served as the Chief HR and Communications Officer for Tata Global Beverages Company, London, UK, from June 2008 to February 2013. In addition, Mr. Miglani held various global and regional HR leadership roles around the world during his career at The Coca-Cola Company and British American Tobacco.

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Maurizio Nicolelli (age 52) | Executive Vice President and Chief Financial Officer
Mr. Nicolelli has served as our Executive Vice President and Chief Financial Officer since February 2020. Prior to joining the Company, Mr. Nicolelli served as Senior Vice President and Chief Financial Officer of Casa Systems beginning in 2019. He previously served 23 years at FactSet Research Systems, where he was Senior Vice President, Principal and Chief Financial Officer from 2009 to 2018.

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EXECUTIVE COMPENSATION

EXECUTIVE COMPENSATION

COMPENSATION DISCUSSION AND ANALYSIS

Table of Contents

NAMED EXECUTIVE OFFICERS

 
63

EXECUTIVE SUMMARY

 
63

Select 2020 Financial and Business Highlights

 
63

Total Stockholder Return

 
64

Awards and Industry Recognition

 
64

Clients and Operations

 
64

Summary of Key Compensation Considerations & Decisions in 2020

 
65

Pay-for-Performance

 
66

EXECUTIVE COMPENSATION PROGRAM, PRACTICES AND POLICIES

 
67

OVERVIEW OF COMPENSATION POLICIES AND PHILOSOPHIES

 
69

COMPENSATION PROCESS: ROLES AND RESPONSIBILITIES

 
70

COMPONENTS OF EXECUTIVE COMPENSATION FOR 2020

 
72

DETAILED REVIEW OF COMPENSATION COMPONENTS

 
73

Base Salary

 
73

Incentive Bonus

 
75

Long-Term Equity Incentives

 
80

FISCAL YEAR 2020 AWARDS

 
81

PAYOUT OF AWARDS GRANTED IN PRIOR FISCAL YEARS

 
82

NEW HIRE AWARDS FOR MR. NICOLELLI

 
83

BENEFITS AND PERQUISITES

 
83

RISK AND COMPENSATION POLICIES

 
83

SEVERANCE AND CHANGE-IN-CONTROL BENEFITS

 
83

REVISED EMPLOYMENT AGREEMENT FOR MR. KAPOOR

 
84

2021 COMPENSATION

 
84

DEDUCTIBILITY CAP ON EXECUTIVE COMPENSATION

 
84

GRANTS OF PLAN-BASED AWARDS TABLE FOR FISCAL YEAR 2020

 
88

EMPLOYMENT AGREEMENTS

 
89

OUTSTANDING EQUITY AWARDS AT FISCAL 2020 YEAR-END

 
92

OPTION EXERCISES AND STOCK VESTED DURING FISCAL YEAR 2020

 
93

PENSION BENEFITS FOR FISCAL YEAR 2020

 
93

POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE IN CONTROL AT FISCAL 2020 YEAR-END

 
93

INDICATIVE PAYOUTS FOR ROHIT KAPOOR

 
96

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EXECUTIVE COMPENSATION

INDICATIVE PAYOUTS FOR MAURIZIO NICOLELLI

  98

INDICATIVE PAYOUTS FOR PAVAN BAGAI

 
98

INDICATIVE PAYOUTS FOR NALIN MIGLANI

 
99

INDICATIVE PAYOUTS FOR VIKAS BHALLA

 
100

INDICATIVE PAYOUTS FOR SAMUEL MECKEY

 
101

CERTAIN DEFINED TERMS

 
101

CEO PAY RATIO

 
103

DIRECTOR COMPENSATION FOR FISCAL YEAR 2020

 
104

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EXECUTIVE COMPENSATION

Named Executive Officers

As determined in accordance with SEC rules, our named executive officers ("NEOs") for 2020 are:

GRAPHIC   Rohit Kapoor, our Vice Chairman and CEO

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Maurizio Nicolelli, our Executive Vice President and CFO

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Pavan Bagai, our President, Chief Operating Officer and Former Interim CFO

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Nalin Miglani, our Executive Vice President and Chief Human Resources Officer

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Vikas Bhalla, our Executive Vice President and Business Head, Insurance

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Samuel Meckey, our Executive Vice President and Business Head, Healthcare

Executive Summary

Select 2020 Financial and Business Highlights

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Total Stockholder Return

The following graphs compare our 1-year, 3-year and 5-year cumulative total stockholder return ("TSR") as of December 31, 2020 with the median TSR of companies comprising Nasdaq, S&P 600 and our peer group. As shown in the table, our 1-Year, 3-Year and 5-Year TSR outperformed all of our market benchmarks.

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Awards and Industry Recognition

Clients and Operations

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Summary of Key Compensation Considerations & Decisions in 2020

The following highlights the Compensation Committee's key considerations and compensation decisions in 2020 and with respect to performance for 2020 for our NEOs.

Items
   
  Considerations and Decisions
Say on Pay Approval       Approximately 98% of our stockholders approved, on a non-binding basis (excluding broker non-votes), of our compensation of our NEOs, consistent with average approval of 97.6% over the past five years.

Base Salaries

 

 

 

Although the Compensation Committee approved modest increases to our named executive officers' base salaries to be effective April 1, 2020, the named executive officers agreed to defer these increases due to the uncertainly caused by the COVID-19 pandemic. The increases, therefore, did not come into effect during the 2020 fiscal year.

 

 

 

 

In addition, from May 1, 2020 to August 31, 2020, also due to the uncertainty caused by the COVID-19 pandemic and in order to retain flexibility, the Company's executive management team recommended to the Compensation Committee and the Compensation Committee accepted, salary reductions for the Company's named executive officers. Accordingly, the base salary for Mr. Kapoor, was temporarily reduced by 50% and the base salary for the Company's other named executive officers was temporarily reduced by 30%.

Annual Bonuses

 

 

 

We based our annual bonuses on achievement of company goals (Adjusted EPS, revenue, & AOPM), business unit goals (total revenues, business operating income, and AOPM) and personal performance goals. In 2020, we delivered 99.20% of our Adjusted EPS target, 89.32% of our revenue performance target, and 95.26% of our AOPM target, resulting in annual incentive payout calculations for our NEOs, ranging from 50.36% of target performance to 94.69% of target performance.

 

 

 

 

As discussed in greater detail under Incentive Bonus on page 75, our Compensation Committee did not make adjustments to the performance targets that had previously been set, but rather reviewed Company, business unit, and individual performance and adjusted the payouts to 75% of target performance for all named executive officers taking into account the unanticipated impact of the COVID-19 pandemic and the teamwork and extraordinary efforts of the named executive officers.

Equity Incentives

 

 

 

This was the third and final performance year for the 2018 performance-based restricted stock units. We achieved 99.89% of the revenue target for the revenue-linked restricted stock units resulting in 100% of target funding of those grants. The Company's TSR performance was at the 46.51 percentile amongst its peer group, resulting in the executives earning 88.37% of the 2018 relative TSR-linked restricted stock units pursuant to the terms of the original grant resulting in vesting of shares at 94.13% of target performance. No adjustments were made to the 2018 performance-based restricted stock units or the associated performance targets — or the outstanding 2019 and 2020 performance-based restricted stock units or associated performance targets — to account for the impact of the COVID-19 pandemic in the 2020 fiscal year.

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Pay-for-Performance

Our executive compensation philosophy is focused on pay-for-performance. In this regard, we link a significant portion of each NEO's total compensation to the achievement of specified performance goals. This variable compensation is "at-risk" and rewards performance and contributions to both short- and long-term financial performance

As illustrated by the following charts, the majority of compensation that may be earned by our named executive officers is tied to the achievement of financial performance metrics (annual performance bonuses and PRSUs) or fluctuates with the underlying value of our common stock (RSUs).

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Executive Compensation Program, Practices and Policies

Our compensation programs, practices and policies are reviewed and re-evaluated regularly and are subject to change from time to time in line with market best practices, including alignment of pay with performance. Our executive compensation philosophy is aligned with our core values, focused on pay-for-performance and designed to reflect appropriate governance practices aligned with the needs of our business. Listed below are some of the Company's more significant practices and policies that were in effect during fiscal year 2020, which were adopted to drive performance and to align our executives' interests with those of our stockholders.

 
   
   
   
   
   
   
What We Do       What We Don't Do

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Align our Executive Pay with Performance: We link a significant portion of each NEO's total compensation to the achievement of specific performance goals.

 

 

 

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No Option Repricing: We prohibit option repricing without stockholder approval.

 

 

 

 

Variable compensation is "at-risk" and rewards performance and contributions to both short- and long-term financial performance.

 

 

 

 

 

 

 

 

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Use Appropriate Peer Groups When Establishing Compensation: We established a peer group to help us review market practices and design a competitive compensation program. The criteria for peer group selection include similar market capitalization, annual revenues, scope of operations, potential mobility of talent and industry alignment.

 

 

 

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No Option Backdating or Discounting: We prohibit option backdating and discounting.

 

 

 

 

We set compensation of our executive officers at levels that we believe are appropriate relative to the compensation paid to similarly situated officers of our peers, giving consideration to market and other factors.

 

 

 

 

 

 

 

 

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Ensure Equity Compensation Best Practices: We design equity incentives to encourage our executives to maintain a long-term view of stockholder value creation, to encourage retention and to ensure a significant portion of the award is performance-based. Equity awards are granted on the basis of the executive's prior year's performance and are subject to time or performance-based vesting conditions. A significant portion of such awards only pay out according to the achievement of Company performance goals covering a 3-year period.

 

 

 

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No Excessive Overhang or Dilution: We do not have excessive overhang or dilution from equity grants

 

 

 

 

We hold dividends accrued under our equity awards, if any, until the recipient vests in the underlying shares or units.

 

 

 

 

 

 

 

 

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Maintain an Independent Compensation Committee: Compensation decisions for our NEOs are approved by a Compensation Committee composed of non-employee independent directors. alignment.

 

 

 

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Limited Perquisites: We provide our named executive officers with only limited perquisites and personal benefits that serve an important business purpose in addition to the regular benefits offered to all employees.

 

 

 

 

Our Compensation Committee is advised by an independent consultant who reports directly to the Compensation Committee and provides no other services to the Company or management.

 

 

 

 

 

 

 

We consider the perquisites and personal benefits that we offer to our executives in India to be customary benefits which allow us to remain competitive for top talent.

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Mitigate Risks: The mix and design of our compensation programs serves to mitigate operational, financial, legal, regulatory, strategic and reputational risks.

 

 

 

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No Tax Gross-Ups: We do not provide "gross-ups" to any of our named executive officers, including gross-ups for any excise taxes imposed with respect to Section 280G (change-in-control payments) or Section 409A (nonqualified deferred compensation) of the U.S. Internal Revenue Code of 1986, as amended (which we refer to as the "Code").

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Maintain a Clawback Policy: We maintain a compensation recovery policy that allows the Company to recover compensation (including cash and/or equity awards) previously paid to one or more officers in the event of a financial restatement caused by noncompliance with reporting requirements that impacts the applicable performance metric if, in the opinion of our board of directors or Compensation Committee, the identified executive's misconduct was a material factor causing the restatement.

 

 

 

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No Hedging: We maintain a policy in which the following persons are prohibited from engaging in hedging transactions involving our shares and other securities: our directors and their secretaries and other assistants; our executive officers and their secretaries and other assistants; our employees in the accounting, finance and legal departments; the members and permanent invitees of our operating and executive committees; and all of our vice president level 2 and 3 officers (whom we refer to collectively as "Reporting Persons"). For this purpose, "hedging" refers to any strategy to offset or reduce the risk of price fluctuations in our shares or other securities or to protect, in whole or in part, against declines in the value of our shares or other securities. This prohibition thus applies to all transactions in derivative securities based on our stock such as other securities, including puts, calls, swaps and collar arrangements.

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Maintain a Robust Stock Ownership Policy: We maintain a stock ownership policy that requires our CEO to maintain aggregate stock ownership equal to at least six times his base salary and vested stock ownership equal to at least three times his base salary, and that requires the other members of our executive committee to maintain aggregate stock ownership of at least two times their respective base salaries, and vested stock ownership at least equal their respective base salaries. Covered executives have five years from their hire date to attain the required stock ownership levels and three years to attain the vested stock ownership requirements.

 

 

 

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No Pledging: Under our policy mentioned above, Reporting Persons (as defined above) are only permitted to pledge shares of our stock that exceed those required to be owned under our Stock Ownership Policy described above.

 

 

 

 

We maintain a similar stock ownership policy for our non-employee directors that requires directors to maintain stock ownership of at least five times their respective annual retainers. Directors have five years from their appointment date to attain the required stock ownership levels.

 

 

 

 

 

 

 

 

 

 

 

 

As of December 31, 2020, all covered executives and directors were in compliance with the stock ownership policy.

 

 

 

 

 

 

 

 

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EXECUTIVE COMPENSATION

Overview of Compensation Policies and Philosophies

We believe that our long-term success is linked to our ability to recruit, train, motivate and retain employees at every level. There is significant competitive pressure in our industry for qualified managers with a track record of achievement. It is critical that we recruit, train, motivate and retain highly talented individuals at all levels of the organization who are committed to our core values of innovation, collaboration, excellence, integrity and mutual respect. We believe that our executive compensation programs are integral to achieving this end.

Our Compensation Committee bases its executive compensation programs on the following objectives, which guide us in establishing all of our compensation programs:

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Compensation Process: Roles and Responsibilities

Our Compensation Committee has established a number of processes to assist it in ensuring that our executive compensation programs are achieving their objectives. Our Compensation Committee, our management and our independent compensation consultant are each engaged in these processes, as described in greater detail below.

 
   
   
Company Performance —
Compensation Committee
      Establishment of Performance Measures

At the beginning of each year, or the end of the prior year, our Compensation Committee establishes the Company-wide and relevant business line performance measures on which our named executive officers' annual incentive bonuses and equity incentive awards are largely based. These measures reflect targets that are intended to encourage stretch performance.

Assessment of Company Performance

At the end of the performance period, the Compensation Committee reviews and certifies our performance achievement in relation to the pre-established targets, and considers the appropriateness of adjustments to the performance criteria and calculations of performance achievement.

Individual Performance —
Board of Directors,
Compensation and Nominating
and Governance Committees,
and Vice Chairman and CEO
      The evaluation of an individual's performance determines a portion of the payouts under our incentive bonus program and also influences any changes in base salary for each of our named executive officers.

Assessment of Vice Chairman and CEO Performance

For Mr. Kapoor, our board of directors reviews and provides feedback on a self-evaluation prepared by Mr. Kapoor. Our Chairman then discusses the consolidated feedback from the board of directors with our Compensation and Nominating and Governance Committees. Once all directors have given feedback on Mr. Kapoor's performance, we conduct a comprehensive discussion of the full board of directors on Mr. Kapoor's performance, leadership accomplishments and overall competence to evaluate the achievement of established objectives.

Assessment of Performance for All Other NEOs and Executive Officers

For all other NEOs and executive officers, Mr. Kapoor makes a performance assessment and compensation recommendation to our Compensation and Nominating and Governance Committees. He bases the performance assessments on our named executive officers' self-evaluations and his performance appraisals of each of them.

Our Compensation and Nominating and Governance Committees reviews the performance assessments with Mr. Kapoor, and evaluates the achievement of established objectives by each named executive officer and his business line, if applicable, and his contribution to our performance, leadership accomplishments and overall competence. The Compensation and Nominating and Governance Committees may exercise their judgment based on the named executive officer's interactions with the board of directors.

Other Matters Relevant to
Compensation Decisions —
Compensation Committee
      Our Compensation Committee periodically reviews related matters such as succession planning and management, evaluation of management performance, changes in the scope of managerial responsibilities, and consideration of the business environment, and considers such matters in making compensation decisions. The Compensation Committee also takes into account an executive officer's job responsibilities, performance, qualifications and skills in determining individual compensation levels.

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EXECUTIVE COMPENSATION

 
   
   
Independent Compensation
Consultant
      For 2020, the Compensation Committee retained the services of FW Cook, a qualified and independent compensation consultant, to aid the Compensation Committee in performing its duties. The Compensation Committee's compensation consultant assists in:

collecting and evaluating external market data regarding executive compensation and performance,

selecting peer group companies,

reviewing the proxy statement, and

advising the Compensation Committee on developing trends and best practices in executive and director compensation and equity and incentive plan design.

Other than performing these consulting services, FW Cook does not provide other services to us or our executive officers. We have affirmatively determined that no conflict of interest has arisen in connection with the work of FW Cook as compensation consultant for the Compensation Committee.

Peer Market Data

Compensation Committee and
Independent Compensation
Consultants

      We review peer compensation data at the beginning of the year (or the end of the prior year) in order to set compensation for each year. At the time compensation decisions were made for our U.S.-based and other senior executive officers in 2020, our Compensation Committee reviewed publicly available compensation data for companies that are engaged in business and technology services like us taking into account whether the companies had market capitalizations, geographic locations, or annual revenues similar to ours. The companies that comprised our peer group for 2020 were as follows: Blackbaud, CoreLogic, CSG Systems International, EPAM Systems, Genpact, Guidewire, Sykes Enterprises, Virtusa, and WNS Holdings.

Management also separately engaged Aon Consulting in 2019 for the purpose of providing a survey of compensation data (the parameters of which were not prepared by Aon Consulting) for individuals in our global industry holding analogous positions to our executive officers. While the Compensation Committee reviewed and considered the data provided by these surveys, it did not consider or review the compensation paid to executives at the component companies included within such surveys and did not use this information or any other data as a definitive benchmark to set executive compensation for fiscal year 2020.

Our Compensation Committee reviews compensation information provided by FW Cook and other third party data in order to evaluate each executive's base pay, incentive bonus and equity incentives when changes in compensation are considered. Compensation decisions are designed to promote our fundamental business objectives and strategy.

Our Compensation Committee uses the compensation data to obtain a general understanding of current market practices, so it can design our executive compensation program to be competitive. Market data is not used exclusively, but rather as a point of reference to draw comparisons and distinctions.

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Components of Executive Compensation for 2020

For 2020, the compensation of executive officers consisted of the following five primary components:

Compensation Component
   
  Description
   
  Objectives
Base Salary       Fixed compensation that is reviewed annually and is based on performance, experience, responsibilities, skill set and market value.       Provide a base level of compensation that corresponds to the job function performed.

Attract, retain, reward and motivate qualified and experienced executives.

Annual Incentives       "At-risk" compensation earned based on performance measured against pre-established annual goals.
Goals are tailored to each executive's position.
      Incentivize executives to achieve annual goals that ultimately contribute to long-term company growth and stockholder return.
Long-Term Incentives       "At-risk" compensation in the form of restricted stock unit awards whose value fluctuates according to stockholder value.

50% of the award vests based on continued service.

50% vests based on achievement of revenue and total stockholder return goals.

      Align executive interests with those of stockholders.

Reward continuous service with the company.

Incentivize executives to achieve goals that drive company performance over the long-term.

Other Benefits       Broad-based benefits provided to company employees (e.g., health and group insurance), a retirement savings plan and other personal benefits where appropriate.       Provide a total compensation package that is competitive with the marketplace and addresses unique needs, especially for overseas executives.
Severance and Change in Control Protections       Protect executives during potentially tumultuous corporate transaction.

Provide reduced post-employment compensation upon other involuntary terminations.

      Allow executives to focus on generating stockholder value during a change in control transaction.

Provide market-competitive post-employment compensation recognizing executives likely require more time to find subsequent employment.

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Detailed Review of Compensation Components

Base Salary

As discussed above, we provide our executive officers fixed compensation commensurate with their performance, experience, responsibilities, skill set and market value. This attracts and retains an appropriate caliber of talent for the position and provides a base wage that is not subject to our performance risk. In setting base salaries for 2020, our Compensation Committee considered:

 
   
   
Individual Performance       The degree to which the executive met and exceeded expectations.
Market Data       Geographical and market data to test reasonableness of compensation.
Overall Compensation Mix       Senior employees should have a greater portion of their compensation tied to increasing stockholder value.

Although the Compensation Committee approved modest increases to our named executive officers' base salaries to be effective April 1, 2020, the named executive officers agreed to defer these increases due to the uncertainly caused by the COVID-19 pandemic. The increases, therefore, did not come into effect during the 2020 fiscal year. Further, the fixed compensation amounts for each of Messrs. Bagai and Bhalla cover not only base salary, but also amounts available as a travel allowance, an automobile allowance, a housing allowance, a medical allowance and a cash supplementary allowance, consistent with compensation practices in India.

In May 2020, the Company announced that, due to the uncertainty caused by the COVID-19 pandemic and in order to retain flexibility, the Company's executive management team recommended to the Compensation Committee and the Compensation Committee accepted, salary reductions of 30% or 50% for each of the Company's named executive officers. As a result, the base salary for Mr. Kapoor, was temporarily reduced by 50% and the base salary for the Company's other named executive officers was temporarily reduced by 30% from May 1, 2020 through August 31, 2020.

Each named executive officer agreed that their base salary reduction would not constitute a termination for "good reason" within the meaning of such named executive officer's employment agreement.

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EXECUTIVE COMPENSATION

The following table shows the 2019 and 2020 fixed compensation, the approved fixed compensation of our named executive officers for 2020, including the increases that would have taken effect on April 1, 2020 and without adjusting for the salary reductions mentioned above, the actual earned fixed compensation of our named executive officers in 2020, and the overall difference between our named executive officers' actual earned fixed compensation and what they would have earned in 2020 but for the base salary increase deferrals and temporary base salary reductions.

Name
   
  2019 Base Salary /
Annual Fixed
Compensation ($)

   
  2020 Base Salary /
Annual Fixed
Compensation ($)(7)

   
  2020 Approved Base
Salary / Fixed
Compensation ($)(8)

   
  2020 Actual Earned
Base Salary / Fixed
Compensation ($)(9)

   
  2020 Overall Base
Salary / Fixed
Compensation
Reduction ($)

 

Rohit Kapoor

        720,000         720,000         742,541         599,016         143,525  

Maurizio Nicolelli(1)

                450,000         432,172         384,283         47,889  

Pavan Bagai(6)

        INR26,000,000 (2)       INR26,000,000 (3)       INR27,502,732 (10)       INR23,400,000 (11)       INR4,102,732 (12)

Nalin Miglani

        450,000         450,000         463,525         404,631         58,893  

Vikas Bhalla(6)

        INR22,000,000 (4)       INR22,000,000 (5)       INR23,878,415 (13)       INR19,800,002 (14)       INR4,078,413 (15)

Samuel Meckey

        425,000         425,000         437,773         382,152         55,622  

(1) Mr. Nicolelli joined us on February 3, 2020. As such, he was not eligible for a base salary increase in 2020 and this table shows his approved and actual earned base salary prorated from his start date.

(2) Equivalent to $364,248, converted at 71.38 INR to 1 USD, which was the exchange rate on December 31, 2019.

(3) Equivalent to $355,848, converted at 73.065 INR to 1 USD, which was the exchange rate on December 31, 2020.

(4) Equivalent to $308,210, converted at 71.38 INR to 1 USD, which was the exchange rate on December 31, 2019.

(5) Equivalent to $301,102, converted at 73.065 INR to 1 USD, which was the exchange rate on December 31, 2020.

(6) The annual fixed compensation paid to Messrs. Bagai and Bhalla is in Indian rupees (INR).

(7) The Compensation Committee approved base salary increases in February 2020; however, as noted above these increases were deferred and did not come into effect during the 2020 fiscal year. The following base salary or annual fixed compensation amounts were approved, but not implemented: $750,000 for Mr. Kapoor; INR 28,000,000 for Mr. Bagai; $468,000 for Mr. Miglani; INR 24,500,000 for Mr. Bhalla; and $442,000 for Mr. Meckey.

(8) Base salary increases were to be effective on April 1, 2020.

(9) Includes the deferral of the approved 2020 base salaries, as well as the reduction of Mr. Kapoor's base salary by 50%, and our other named executive officers' base salaries by 30% from May 1, 2020 through August 31, 2020.

(10) Equivalent to $376,415, converted at 73.065 INR to 1 USD, which was the exchange rate on December 31, 2020.

(11) Equivalent to $320,263, converted at 73.065 INR to 1 USD, which was the exchange rate on December 31, 2020.

(12) Equivalent to $56,152 converted at 73.065 INR to 1 USD, which was the exchange rate on December 31, 2020.

(13) Equivalent to $326,811, converted at 73.065 INR to 1 USD, which was the exchange rate on December 31, 2020.

(14) Equivalent to $270,992, converted at 73.065 INR to 1 USD, which was the exchange rate on December 31, 2020.

(15) Equivalent to $55,819, converted at 73.065 INR to 1 USD, which was the exchange rate on December 31, 2020.

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EXECUTIVE COMPENSATION

Incentive Bonus

We have established an annual incentive bonus program in order to align our executive officers' goals with our performance targets for the current year and to encourage meaningful contributions to our future financial performance. Our Compensation Committee approved the framework of our incentive bonus program in late 2019 for the year 2020 for bonuses payable in respect of 2020 performance. Under the program, bonus target amounts, expressed as a percentage of base salary or annual fixed compensation, are established for participants at the beginning of each year unless their employment agreements contain different terms. Funding of potential bonus payouts for the year are determined by our financial results for the year relative to predetermined performance measures and our assessment of each named executive officer's performance relative to his predetermined individual performance goals. If our performance falls short of target, our aggregate funding of the annual cash bonus incentive pool declines. If we do not achieve a minimum threshold for the established financial performance objectives, then the bonus pool is not funded for that particular objective. Although the Compensation Committee has not historically done so, it has the discretion under the 2018 Plan to adjust an award payout from the amount yielded by the formula at the end of the performance period for reasons such as the effect of changes in laws or regulatory rules, acquisitions or divestitures, extraordinary accounting items, foreign exchange gains or losses, and/or any specific unusual or non-recurring events. As discussed in greater detail below, the Compensation Committee utilized this discretion for the year 2020 in light of the unanticipated impact of the COVID-19 global pandemic.

Our Compensation Committee considered the following when establishing the awards for 2020:

Bonus Targets. Bonus targets were established based on job responsibilities and comparable market data. Our objective was to set bonus targets such that total annual cash compensation was within the broad middle range of market data and a substantial portion of that compensation was linked to our performance. Consistent with our executive compensation policy, individuals with greater job responsibilities had a greater proportion of their total compensation tied to our performance. During 2020, our Compensation Committee established the following bonus targets (expressed as a percentage of base salary or annual fixed compensation) as well as maximum bonus targets for each named executive officer.

Name
   
  Bonus Target
   
  Bonus Maximum
Rohit Kapoor       150% of base salary       310% of base salary
Maurizio Nicolelli       75% of base salary       155% of base salary
Pavan Bagai       75% of annual fixed compensation       155% of annual fixed compensation
Nalin Miglani       75% of base salary       155% of base salary
Vikas Bhalla       75% of annual fixed compensation       154% of annual fixed compensation
Samuel Meckey       75% of base salary       154% of base salary

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Performance Measures. Our executives were eligible to earn annual bonuses based on their achievement of company-wide performance metrics, business line or other company performance metrics and individual performance, as described in the tables below

Name
   
  Company-Wide
Performance(1)

   
  Individual
Performance

   
  Business Line or Other
Company Performance(2)

Rohit Kapoor       65%       15%       20%
Maurizio Nicolelli       60%       20%       20%
Pavan Bagai       65%       15%       20%
Nalin Miglani       60%       20%       20%
Vikas Bhalla       50%       20%       30%
Samuel Meckey       50%       20%       30%

(1) Based 30% on the Company's Adjusted EPS goal, 40% on the Company's revenue goal, and 30% on the Company's adjusted operating profit margin (AOPM) for all employees whose incentive bonus is linked to Company-wide financial performance, including our named executive officers.

(2) For Messrs. Kapoor, Bagai, Nicolelli and Miglani, based on aggregate Revenue, Adjusted EPS, and AOPM for specific business units. For Messrs. Bhalla and Meckey, based on aggregate revenue and business operating income for specific business units. Business operating income is a component for measuring business unit performance that is computed as the business unit's gross margin less direct operating expenses.

In 2020, the Compensation Committee continued to set the business line and other Company performance goals as well as the individual performance goals described above for all named executive officers to ensure the executives were properly focused on both the Company's Adjusted EPS, revenue, and AOPM goals, aggregate of business units' performance on revenue and other areas of performance that are unique to their positions within the organization. The Compensation Committee believes achievement of these performance metrics will drive our business and, in turn, lead to increased stockholder value.

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Determination of Financial Performance Achievement:

For 2020, our Compensation Committee established an Adjusted EPS target of $3.65 (18.12% higher than our actual Adjusted EPS for the prior year and 14.96% higher than the prior year's target performance), a revenue target of $1.075 billion (8.44% higher than our actual revenue for the prior year and 8.70% higher than the prior year's target performance), and an AOPM target of $165.40 million or 15.4%. 2020 was the first year that the AOPM metric was used. As shown below, the portion of incentive bonus payments that were subject to these financial performance measures could have ranged from zero to 210% of target depending on the achievement of the performance goals:

Performance Targets: Adjusted EPS ($3.65); Revenue ($1.075 billion); and AOPM ($165.40 million)

 
   
   
% of Performance Achieved Compared to Target Goal       % of Target Portion Funded
Less than 90%       0%
At 90%       10%
90% to 100%       Linear interpolation from 10% to 100%
At 100%       100%
100% to 105%       Linear interpolation from 100% to 160%
105% to 110%       Linear interpolation from 160% to 210%
Above 110%       210%

Based on our performance during the 2020 fiscal year, we achieved 99.20% of our Adjusted EPS target (resulting in funding of 92.80%), 89.32% of our revenue target (resulting in funding of 0%), and 95.26% of our AOPM target (resulting in funding of 57.37%) for a weighted funding of 45.1%. Notwithstanding these funding percentages, as described below, the Compensation Committee awarded incentive bonus payments in light of our executives' individual and collective extraordinary contributions during the unique circumstances of 2020.

The bonus pool funding for employees whose bonuses are tied to the performance of specific business lines is determined by targets established for such businesses by our Compensation Committee.

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EXECUTIVE COMPENSATION

Determination of Individual Performance Measure Achievement:

Our named executive officers earn a portion of their respective annual incentive bonuses based on the achievement of individual performance measures that are designed to balance the attention of the officer between the achievement of near-term objectives that improve specific processes or performance metrics and long-term objectives for us. For more information on the process, roles and responsibilities for determining individual performance measure achievement, please see "Compensation Process: Roles and Responsibilities" on page 70. Below is a summary of each named executive officer's individual performance measures, and a summary of the achievements and accomplishments toward meeting those performance measures:

Named Executive Officer
   
  Individual Performance Measure
   
  Individual Performance Achievement
Rohit Kapoor      

Drive profitable growth agenda

Build digital strategy and organization

Improve return on invested capital

Strengthen succession planning

Enhance ESG focus

     

Led organization to achieve solid financial results despite a very challenging global environment due to the COVID-19 pandemic

Acceleration of digital efforts

Excellent focus on ROIC and active pursuit of investment opportunities

Strong progress on development of executive team

Substantial improvement in ESG focus and reporting

Maurizio Nicolelli      

Improve reporting processes

Improve return on capital

Develop long-term M&A stratgey

Drive profitable growth agenda

     

Led finance team through tumultuous year with frequent changes to operating plan due to the COVID-19 pandemic

Significantly enhanced our stock buy back program to effectively deploy capital

Drove the focus on clearly articulating strategic priorities for M&A assets

Pavan Bagai      

Drive revenue growth and increase profitability

Build digital strategy and organization

Continue focus on risk and compliance culture

     

Drove cost reductions in technology, facilities, and logistics and improved productivity

Led business recovery and stabilization during COVID-19 pandemic

Developed digital strategy

Effectively managed information security and related processes

Nalin Miglani      

Focus on company culture

Expand and drive digitial HR transformation

Drive effective recruitment of key employees