2018 Guide to Effective Proxies

2.17.2 Executive summary | 265 6 TH EDITION | GUIDE TO EFFECTIVE PROXIES GENERAL MOTORS EXECUTIVECOMPENSATION CompensationDecisionsforCharlesK.Stevens,III CharlesK.Stevens,III, ExecutiveVicePresidentandChiefFinancialOfficer 2017performancehighlightsforMr.Stevensinclude: Continued to drive improvement in EBIT-adjusted and delivered record EBIT- adjusted margins,including thethird straight yearof10%orhighermargins in NorthAmerica IncreasedEPS-diluted-adjustedtorecord$6.62 Repurchased more than $6.7 billion and returned $25 billion to shareholders throughdividendsandsharerepurchasessince2012,representingmorethan90% ofavailablefreecashflowgeneratedoverthattime AchievedROIC-adjustedof28.2% Delivered $5.5 billion in cost savings against $6.5 billion of targeted savings throughtheendof2018 Continuedtomakeinvestmentsinfuturetechnologyandinnovation TheCompensationCommitteekeptMr.Stevens’basesalary at$1,100,000 basedon the competitive market analysis provided by the Compensation Committee’s independent compensation consultant. For 2017, the Compensation Committee awardedMr.Stevensanannualequitygrantof$3.725million,consistingof75%PSUs and25%StockOptions. The Compensation Committee awarded Mr. Stevens 40 points based on his results, highlighted above, for the 2017 performance year. The total compensation for Mr.Stevensin2017,includingsalary,STIPandLTIPawards,isdisplayedbelow. PayElement MajorityofPayIsAt-Risk AwardedValue BaseSalary OnlyFixedPayElement $1,100,000 STIP PerformancetoMetrics $1,622,500 PSUs (1) PerformancetoMetricsandStockPrice $3,076,744 StockOptions (2) PerformancetoStockPrice $ 931,251 TOTAL $6,730,495 (1) PSUs are subject to performance vesting; value reflects grant date fair value at target performance forRelative ROIC-adjustedawardsandprobableperformance results fromthe MonteCarloanalysistovalueRelativeTSRawards. (2) StockOptionsaresubjecttotime-basedvesting. 2017COMPENSATION STRUCTURE (inmillions) Base Salary STIP PSUs Stock Options 40% Short-Term Cash 60% Long-Term Equity $2.79 $ 1.38 $ 1.10 $0.93 82%ofPay isAt-Risk AWARDEDVALUE vs. REALIZEDCOMPENSATION (inmillions) $7.2 $6.7 $7.9 $ 10.5 $3.5 $4.6 2015 2016 2017 AwardedValue RealizedCompensation Awardedvaluereflectstheamountincludedin the Summary Compensation Table, excluding change in pension value and all other compensation.Realizedcompensationincludes base salary, earned STIP, and all options exercisedandstockvestedduringtheyear.2017 realizedcompensationincreasedrelativetothe prioryearreflecting1)thevestingofthePSU awardgrantedtoMr.Stevensin2014,theyear hewaspromotedtohiscurrentrole;and2)an increase in stock price at the time of vesting versustheprioryear. G E N E R A L M O T O R S 2018 PROXYSTATEMENT 49 Total of 07 pages in section EXECUTIVECOMPENSATION Compensation Decisions for MaryT. Barra MaryT.Barra, ChairmanandChiefExecutiveOfficer Ms. Barra’s performance for 2017 was directly aligned with the Company’s 2017 strategicobjectives: Core Continued to drive improvement in EBIT-adjusted margins and deliveredrecord EBIT-adjustedmargins,includingthethirdstraightyearof10%orhighermargins inNorthAmerica IncreasedEPS-diluted-adjustedtorecord$6.62 Achieved13top3modelsintheJ.D.PowerAPEALsurveymeasuringperformance, execution,andlayout ReceivedtheIHSAutomotiveLoyaltyAwardforthethirdstraightyear Chevroletsoldarecordnumberofelectricvehicles,includingmorethan43,600 BoltEVsandVolts CompletedthesalesofOpel/VauxhallandGMFinancialEuropeanbusinessesto PSA Morethan150facilitiesareoperatinglandfillfree Global Cadillac experienced record sales in 2017 with significant increases from GMChina Transformation Introducedthevisionofzerocrashes,zeroemissions,andzerocongestionforthe futureofGM ExpandedbothMavenandBookbyCadillactoincreasecarsharingcapabilities Announcedplanstodeployself-drivingvehiclesinadenseurbanenvironmentin 2019 LaunchedSuperCruise,theworld’sfirsthands-freehighwaydrivingtechnology, ontheCadillacCT6 180Cruiseautonomousvehiclesbuiltwithapproximately100testinginArizona, California,andMichigan Acquired Strobe, Inc. to help develop next-generation LiDAR solutions for self- drivingvehiclesandreduceLiDARcostsby99%overtime Announcedplansforatleast20newelectricvehiclesby2023 Becamethefirstcompanytousemass-productionmethodstobuildautonomous electrictestvehicles Effective January 1, 2017, the Compensation Committee increased Ms. Barra’s base salaryfrom$2,000,000to$2,100,000basedonherperformance,leadership,andthe competitivemarketanalysisprovidedbytheCompensationCommittee’sindependent compensationconsultant.For2017,theCompensationCommitteeawardedMs.Barra anannualequitygrantof$13millionconsistingof75%PSUsand25%StockOptions. These changes placed Ms. Barra in line with the compensation peer group, as her targetedtotaldirectcompensationremainedcompetitiveatthemarketmedian. The Compensation Committee awarded Ms. Barra 40 points based on her results, highlightedabove,forthe2017performanceyear.ThetotalcompensationforMs.Barra in2017,includingsalary,STIPandLTIPawards,isdisplayedbelow. PayElement MajorityofPayIsAt-Risk AwardedValue BaseSalary OnlyFixedPayElement $ 2,100,000 STIP PerformancetoMetrics $ 4,956,000 PSUs (1) PerformancetoMetricsandStockPrice $10,737,570 StockOptions (2) PerformancetoStockPrice $ 3,250,003 TOTAL $21,043,573 (1) PSUs are subject to performance vesting; value reflects grant date fair value at target performance for Relative ROIC-adjusted awards and probable performance results from the MonteCarloanalysistovalueRelativeTSRawards. (2) StockOptionsaresubjecttotime-basedvesting. Base Salary $2.10 STIP $4.20 PSUs $9.75 Stock Options $3.25 33% Short-Term Cash 67% Long-Term Equity 2017COMPENSATION STRUCTURE (inmillions) 89%ofPay isAt-Risk AWARDEDVALUE vs. REALIZEDCOMPENSATION (inmillions) 2015 2016 2017 AwardedValue RealizedCompensation $28.0 $7.3 $21.8 $11.2 $21.0 $25.0 Awardedvaluereflectstheamountincludedin the Summary Compensation Table, excluding change in pension value and all other compensation.Realizedcompensationincludes base salary, earned STIP, and all options exercisedandstockvestedduringtheyear.2017 realizedcompensationincreasedrelativetothe prior year reflecting 1) the vesting of the PSU award granted to Ms. Barra in 2014, the year shewaspromotedtohercurrentrole;and2)an increase in stock price at the time of vesting versustheprioryear. 48 G E N E R A L M O T O R S 2018 PROXYSTATEMENT EXECUTIVECOMPENSATION Compensation Overview Our Company Performance In 2017, we continued progress toward our goal of making GM the most valued automotive company fo our shar holders. The resultsbelowdemonstratehowwearepositioningGMasanindustryleaderbothnowandinthefuture: CompletedthesaleofOpel/VauxhallandGMFinancial EuropeanbusinessestoPeugot,S.A.(“PSA”); Exited franchises in South and East Africa and discontinuedretailsalesoperationsinIndia; For the fourth consecutive year, sold more pickup trucksintheUnitedStatesthananyotherautomaker –arecord948,909units; Completed the refresh of GM’s crossover portfolio and became the fastest-growing crossover company in the UnitedStates,withretailmarketshareup1.6percentage pointsto13.1%,accordingtoJ.D.PowerPINestimates; Increased global Cadillac sales 15.5% in 2017 with significant sales increases in international markets, includinga50.8%increaseinChina; ImprovedEBIT-adjustedmarginto8.8%forcontinuing operations; Returnedatotalof$6.7billiontoshareholdersthrough dividendsandsharerepurchases; IncreasedEPS-diluted-adjustedto$6.62; Launched Super Cruise, the world’s first hands-free highwaydrivingtechnology,ontheCadillacCT6; Sharedthevisionforzerocrashes,zeroemi sions,and zerocongestionandoutlinedanall-electricfuturewith plans to launch at least 20 electric vehicl models by 2023; Announced plans to deploy self-driving vehicles in a denseurbanenvironmentin2019; Acquired Strobe, Inc. to help develop next-generation LiDAR solutions for self-driving vehicles and reduce LiDARcostsby99%overtime;and Became the first company to use mass-productio methodstobuildautonomouselectrictestvehicle . Note: EBIT-adjustedmarginandEPS-diluted-adjustedarenon-GAAPfinancialmeasures.RefertoAppendixAforareconciliationofthesenon-GAAP measurestotheirclosestcomparableGAAPmeasure. Our Vehicle Launches Welaunched25vehiclesacrosstheglobein2017,includingsomeofthekeyvehiclesbelow: • BuickRegal • CadillacXTS • ChevroletTraverse • BuickEnclave • ChevroletEquinox • GMCTerrain Our Named Executive Officers MaryT.Barra ChairmanandChiefExecutiveOfficer CharlesK.Stevens,III ExecutiveVicePresidentandChiefFinancialOfficer DanielAmmann President MarkL.Reuss ExecutiveVicePresident,GlobalProductDevelopment,PurchasingandSupplyChain AlanS.Batey ExecutiveVicePresidentandPresident,NorthAmerica Karl-ThomasNeumann FormerExecutiveVicePresidentandPresident,Europe 36 G E N E R A L M O T O R S 2018 PROXYSTATEMENT GOLDMAN SACHS GROUP, INC. ExecutiveSummary |PerformanceHighlights Performance Highlights WeencourageyoutoreadthefollowingPerformanceHighlightsasbackgroundtothisProxyStatement. In2017,wedeliveredhighernetrevenues,positiveoperatingleverageandstrongerpre-taxearningsyear-over-year despiteachallengingenvironmentforourmarket-makingbusinesses.Weclosedtheyearwithaleadingfranchise acrossmanyofourbusinessesandanarticulatedstrategytogrownetrevenuesandearnings. BUSINESSPERFORMANCEHIGHLIGHTS d Netrevenuesin2017wereup5%year-over-year,outpacingtotaloperatingexpenses,whichwereuponly3% year-over-year,resultinginsolidpre-taxearningsgrowthof8%to$11.1billionandEPS(Ex.U.S.Tax Legislation)of$19.76,up21%year-over-year. » 3of4segments postedhighernetrevenuesyear-over-year,withrecordInvestmentManagementnet revenuesandInvestmentBankingpostingitssecond-bestyearofnetrevenues. » Pre-taxMarginwas34.7% ,up100basispointsascomparedto2016. d Since2009year-end,wehavegrownBVPS anaverageof6%peryear . d Wehaveshownacommitmentovertimetoprudentlymanagingourexpensebase.Examplesinclude: » 37.0%CompensationRatio ,down110basispointsascomparedto2016. » Approximately $2.8billion inannouncedandcompletedexpenseinitiativessince2011. 1 » 930basispointsreduction inaverageannualCompensationRatiofor2009-2017ascomparedto2000- 2007. 2017vs.2016Performance NetRevenues +5% Expenses +3% Pre-taxEarnings +8% RETURNOUTPERFORMANCEVS.GLOBALPEERS Thefirmcontinuedtopoststrongrelativeperformanceagainstitsglobalpeergroup. 2 Our2017ROE(Ex.U.S.Tax Legislation)of10.8%wasapproximately190basispointshigherthantheU.S.Peeraverageandapproximately820 basispointshigherthantheEuropeanPeeraverage(excludingtheimpactofU.S.TaxLegislationforallfirms).Ona U.S.GAAPbasis,GSROEwas4.9%,whichisdepictedinthechartbelow. ROEEx.U.S.TaxLegislation 3 JPM MS BAC UBS C BARC -1.0% GS 10.9% 9.7% 7.9% 7.4% 7.0% CS 3.1% DB 1.0% 10.8% 4.9% 1 Comprisedof$1.9billionrun-ratesavingscompletedin2011-2012and$0.9billionrun-ratesavingscompletedin2016. 2 U.S.PeersreferstoBankofAmericaCorp.,CitigroupInc.,JPMorganChase&Co.andMorganStanley.EuropeanPeersreferstoBarclays, CreditSuisse,DeutscheBankandUBS. 3 BasedonpublicdisclosuresavailableasofMarch20,2018.ForadditionaldetailontheU.S.TaxLegislation-relatedadjustmentforGS,please see AnnexA .OnaGAAPbasis,averageROEforourU.S.Peerswas5.2%andaverageROEforourEuropeanPeerswas-1.2%. ProxyStatementforthe2018AnnualMeetingofShareholders | GoldmanSachs 3 2017vs.2016Performance+5%+3%+8%NetRevenuesExpensesPre-taxEarningsROEEx.U.S.TaxLegislation310.9%10.8%4.9%9.7%7.9%7.6%7.0%3.1%1.4%-1.0%JPMGSMSBACUBSCCSDBBARC Total of 14 pages in section ExecutiveSummary |ImpactofCertainTax-RelatedItemsontheFirm’s2017Performance Impact of Certain Tax-Related Items on the Firm’s 2017 Performance d During2017,theTaxCutsandJobsAct(U.S.TaxLegislation)wasenacted,resultingina$4.4billionone-tim estimatedincometaxexpenseforthefirm.Thistaxexpenseincludedanapproximately$3.3billionexpense associatedwithaone-timedeemedrepatriationtaxonforeignearningsandanapproximately$1.1billion expenserelatedtotheremeasurementofourdeferredtaxassets,andreducedROEby590basispointsan EPSby$10.75. d WhenmakingNEOcompensationdeterminations,ourCompensationCommitteeexcludedtheimpactofthistax expense;asummaryofthisadjustment(whichresultedinanincreasetoROEandEPS)isshownbelow. ROEEx.U.S. TaxLegislation ImpactofU.S. TaxLegislation GAAPROE 10.8% 590bps 4.9% EPSEx.U.S. TaxLegislation ImpactofU.S. TaxLegislation GAAPEPS $10.75 $19.76 $9.01 d WhenmakingNEOcompensationdeterminations,ourCompensationCommitteealsoadjustedROEandEPSto excludethe$719millionincometaxbenefitarisingfromthefirm’srequiredadoptionofanewaccounting standardrelatingtoemployeeshare-basedpaymentaccounting(StockAccountingStandard). d ExcludingthisbenefitresultedinadecreasetoouradjustedROEfrom10.8%to9.8%andadecreasetoour adjustedEPSfrom$19.76to$18.01. d TheCommitteebelieveditwasappropriatetoprimarilyassess2017firmwideperformanceexcludingboththe estimatednegativeimpactofthechargerelatedtoU.S.TaxLegislationaswellasthepositiveimpactofthe StockAccountingStandardgiventhatbothwereoutsidemanagement’scontrolanddidnotreflectthefirm’s operatingperformance. d InthePerformanceHighlightsthatfollow,ROEandEPSarepresentedexcludingonlytheestimatedimpactof U.S.TaxLegislationinordertoimprovecomparabilityagainstpeerresults.Foradditionaldetailonboth adjustments,pleasesee AnnexA . 2 GoldmanSachs | ProxyStatementforthe2018AnnualMeetingofShareholders 4.9%590bps10.8%$9.01$10.75$19.76GAAPROEImpactofU.S.TaxLegislationROEEx.U.S.TaxLegislationGAAPEPSImpactofU.S.TaxLegislationEPSEx.U.S.TaxLegislation ExecutiveSummary |2018AnnualMeetingInformation Executive Summary ThissummaryhighlightscertaininformationfromourProxyStatementforthe2018AnnualMeeting.Youshould readtheentireProxyStatementcarefullybeforevoting.Pleaserefertoourglossaryin FrequentlyAskedQuestions onpage96fordefinitionsofcertaincapitalizedterms. 2018 Annual Meeting Information DATEANDTIME PLACE RECORDDATE ADMISSION 8:30a.m., localtime Wednesday,May 2,2018 GoldmanSachs officeslocatedat: 30HudsonStreet, JerseyCity,NewJersey March5,2018 Photoidentification andproofofownership asoftherecorddate arerequiredtoattend theAnnualMeeting ForadditionalinformationaboutourAnnualMeeting,includinghowtoaccesstheaudiowebcast,see Frequently AskedQuestions . Matters to be Voted on at our 2018 Annual Meeting BOARD RECOMMENDATION PAGE Item1.ElectionofDirectors FOReachdirector 15 OtherManagementProposals Item2.AnAdvisoryVotetoApproveExecutiveCompensation(SayonPay) FOR 69 Item3.ApprovalofTheGoldmanSachsAmendedandRestatedStockIncentivePlan(2018) FOR 70 Item4.RatificationofPwCasourIndependentRegisteredPublicAccountingFirmfor2018 FOR 82 ShareholderProposals Item5.ShareholderProposalRequestingReportonLobbying Requeststhatthefirmprepareareportdisclosingvariouspolicies,proceduresandexpenditures relatingtolobbying AGAINST 84 Item6.ShareholderProposalRegardingAmendmentstoStockholderProxyAccess Requeststhatthefirmamenditsgoverningdocumentstoallowanunlimitednumberofshareholders toformanominatinggrouptosubmitproxyaccessdirectornominees AGAINST 86 ProxyStatementforthe2018AnnualMeetingofShareholders | GoldmanSachs 1