2018 Guide to Effective Proxies

2.17.5 Elements of pay tables | 355 6 TH EDITION | GUIDE TO EFFECTIVE PROXIES COMPENSATION DISCUSSION AND ANALYSIS COMPENSATION DISCUSSION AND ANALYSIS INTRODUCTION In this Compensation Discussion and Analysis, we address the compensation paid or awarded for 2017 to our executive officers listed in the Summary Compensation Table that follows this discussion. We sometimes refer to these executive officers as our “named executive officers,” as such term is used in Item 402 of Regulation S-K. 2017 COMPENSATION COMPENSATION OBJECTIVES We focus on the following objectives in making compensation determinations: • Provide compensation that is competitive in markets in which we compete for management talent. We refer to this objective as “competitive compensation.” • Condition the majority of a named executive officer’s compensation on a combination of short and long-term performance. We refer to this objective as “performance incentives.” • Encourage the aggregation and maintenance of meaningful equity ownership, and the alignment of executive officer and stockholder interests as an incentive to increase stockholder value. We refer to this objective as “alignment with stockholder interests.” • Provide an incentive for long-term continued employment with us. We refer to this objective as “retention incentives.” The principal components of 2017 compensation that we paid to our named executive officers designed to meet these objectives are as follows: Base Salary Salary: Competitive Compensation Annual Incentive Plan Annual Incentive: Performance Incentive, Competitive Compensation, Alignment with Stockholder Interests The Annual Incentive Plan is intended to align executive and stockholder interests by incentivizing annual performance goals that support long-term stockholder returns: - Net Sales is a key growth measure used in our industry - Gross Margin is indicative of our ability to control cost of sales and trade spending, which are critical components of operations - Diluted Earnings Per Share is a key metric used by investors and indicative of profitability impacting our share price - Cash from Operations is a standard metrics used by investors and a good indicator of process discipline and execution capabilities Net Sales (25%) Gross Margin (25%) Diluted EPS (25%) Cash from Operations (25%) Total Pay Stock Options Long-Term Incentive Long-Term Incentive (Options): Performance Incentive, Alignment with Stockholder Interests, Competitive Compensation, Retention Incentive Stock options provide a strong incentive to increase stockholder value because the value of stock options is directly dependent on market performance of our common stock ProfitSharingunderSavingsandProfitSharingPlan: Performance Incentives, Retention Incentives Savings and Profit Sharing Plan Profit Sharing FY17 Pay Element Objective & Detail Church & Dwight Co. | 2018 Proxy Statement 35 CHURCH & DWIGHT CO.