2018 Guide to Effective Proxies

2.9 Board diversity graphics | 153 6 TH EDITION | GUIDE TO EFFECTIVE PROXIES SPROUTS FARMERS MARKET STARBUCKS CORPORATION SUPERIOR ENERGY SERVICES, INC. SVB FINANCIAL GROUP CorporateGovernance Board Diversity While we do not have a formal policy outlining the diversity standards to be considered when evaluating director candidates, our objective is to foster diversity of thought on our board of directors. To accomplish that objective, the nominating and corporate governance committee considers ethnic and gender diversity, as well as differences in perspective, professional experience, education, skill, and other qualities in the context of the needs of our board of directors. Nominees are not discriminated against on the basis of age, race, religion, national origin, sex, sexual orientation, disability, or any other basis prohibited by law. The nominating and corporate governance committee evaluates its effectiveness in achieving diversity on the board of directors through its annual review of board member composition. Our current directors reflect these efforts and the importance of diversity to the board, and we are honored to have been recognized by the Women’s Forum of New York as a 2017 Corporate Champion for board diversity. 2 of 8 Directors areFemale 25% 2 of 8 Directors areEthnicallyDiverse 25% 4 2 2 55 years AverageAge 40s 50s 60s 75% 6 of 8 Directorsare Independent 5.1 years AverageTenure 1-3 yrs 4-10 yrs 11+ yrs 4 1 3 Board Structure Our certificate of incorporation and bylaws provide for a classified board of directors with staggered three-year terms, consisting of three classes as follows: Class Director Independent Class I (term expires at 2020 annual meeting) Terri Funk Graham Steven H. Townsend Yes Yes Class II (term expires at 2018 annual meeting) Joseph Fortunato Lawrence P. Molloy Joseph O’Leary Yes Yes Yes Class III (term expires at 2019 annual meeting) Kristen E. Blum Shon A. Boney Amin N. Maredia Yes No No 12 2018 Proxy Statement Sprouts Farmers Market PROXYSTATEMENTSUMMARY BoardNominees Thefollowingtableprovidessummaryinformationabouteachdirectornominee.Eachdirectornomineeiselectedannuallybyamajorityofvotes cast. DirectorTenure AgeDistribution Gender 0-4YRS. 5-9YRS. 10-14YRS. 15-19YRS. 20+YRS. 3 2 4 2 1 Average DirectorTenure: 10 yrs (1) (3) (4) (2) (2) Average Age: 56 30s 40s 50s 60s 70s 33% WOMEN 8Men 4Women CommitteeMemberships Name Age Director Since PrincipalOccupation Independent ACC CMDC NCGC HowardSchultz 64 1985 executivechairmanofStarbucks Corporation RosalindG.Brewer* 55 2017 grouppresident,Americasand chiefoperatingofficerof StarbucksCorporation MaryN.Dillon 56 2016 chiefexecutiveofficerand directorofUltaBeauty,Inc. MellodyHobson 48 2005 presidentanddirectorofAriel Investments C KevinR.Johnson 57 2009 presidentandchiefexecutive officerofStarbucksCorporation JørgenVigKnudstorp 49 2017 executivechairmanofLEGO BrandGroup SatyaNadella 50 2017 chiefexecutiveofficerand directorofMicrosoftCorporation JoshuaCooperRamo 49 2011 co-chiefexecutiveofficerandvice chairmanofKissingerAssociates, Inc. ClaraShih 36 2011 chiefexecutiveofficerand directorofHearsaySystems,Inc. JavierG.Teruel 67 2005 retiredvicechairmanofColgate- PalmoliveCompany MyronE.Ullman,III 71 2003 retiredexecutivechairmanand ceoofJ.C.PenneyCompany, Inc. , L C CraigE.Weatherup 72 1999 retiredchiefexecutiveofficerof Pepsi-Cola C C Chair L LeadIndependentDirector * Ms.Brewerwasanindependentmemberoftheboardofdirectorsandamember oftheCMDCandtheNCGCpriortoherappointmentasgrouppresident, Americasandchiefoperatingofficer,afterwhichtimeshecontinuedtoserveasa non-independentmemberoftheboardofdirectors. ACC CMDC NCGC AuditandComplianceCommittee CompensationandManagementDevelopmentCommittee NominatingandCorporateGovernanceCommittee 2 / 2018PROXYSTATEMENT BoardandCorporateGovernanceHighlights (BasedoncurrentBoardprofileandpractices) B OARD C OMPOSITION • Total of 12 current directors—all independent directors,exceptforCEOdirector • SeparateBoardChairpersonandCEOroles • IndependentBoardChairperson • Independent chairpersons and members of all Board committees • Seasoned Board with diverse experience, including innovationeconomyindustries,banking/financialservices, global, finance/accounting, risk oversight/management andGovernment/Regulatory • No director serves on more than one public company board,otherthantheCompany • Policy requiring directors to submit their resignation uponreachingtheageof75 B OARD A CCOUNTABILITY • Annualelectionofdirectors • Effective majority voting standard in uncontested directorelections(throughdirectorresignationpolicy) • AnnualBoardandcommitteeevaluations • Regularly-held executive sessions of non-management directors • Robust executive and director equity ownership guidelines • IndependentBoardevaluationofCEOperformance • IndependentBoardapprovalofCEOcompensation • Ongoing director nominee identification and selection process • Limitondirectorcompensationunderequityplan BoardTenure 2 5 5 5yearsor less 16.6% 6 to9years 10+years 0 1 NumberofDirectors 2 3 4 5 41.7% 41.7% AgeDiversity 5 60yearsandunder 0 1 2 3 4 5 41.7% GenderDiversity Women 0 1 2 3 4 5 25% 3 D IRECTOR Q UALIFICATIONS Ourdirectorsreflectaneffectiveanddiversemixofskillsandexperience: Finance/Accoun�ng RiskOversight/Management Government/Regulatory 2 2 5 Client Industry Banking/FinancialServices Global 8 8 4 Leadership 10 S TOCKHOLDER I NTERESTS • Allindependentdirectors,exceptforCEOdirector • SeparateBoardChairpersonandCEOroles • Activestockholderengagementpractices • AnnualSayonPayvote • Stockholdersmayactbywrittenconsent • Onesinglevotingclass—commonstockclass • Nopoisonpill R ISK M ANAGEMENT • Boardandindividualcommitteeoversightofrisk • Separate Board Risk Committee focused on enterprise-wideriskmanagementframework • Risk Committee comprised of the chairpersons of the BoardandallsixBoardcommittees • Risk management guided by Risk Appetite Statement (reviewedonanannualbasisbythefullBoard) iv SUMMARYINFORMATION PROXYSUMMARY Asaresultofhealthyrefreshmentovertheyears,ourBoardhasaneffectivemixofexperience,tenure,independence, ageanddiversity.TheCompanyappreciatesthestronglevelofsupportofourBoardinrecentyears. Board Refreshment 1 New Director 2 Retirements In the Last Four Years Each Board Member received 97% Support or Higher at our 2017 Annual Meeting of Stockholders Tenure 0-5Years 6-10Years 11-15Years 16>Years 50% 25% 12.5% 12.5% Number of Independent Directors 75% 25% Non-Independent Independent Average Age 50% 37.5% 12.5% 55-60 61-70 71-75 Gender Diversity 87.5% 12.5% Female Male iv 2 0 1 8 S P N P r o x y S t a t e m e n t