Allstate Corporation 2775 Sanders Road April 12, 2021 Northbrook, IL 60062 Fellow Stockholders
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Notice of 2021 Annual Meeting and Proxy Statement We empower customers with protection to help them achieve their hopes and dreams. We provide affordable, simple and connected protection solutions. We create opportunity for our team, economic value for our shareholders and improve communities. What’s Inside Letter from Independent Directors to Stockholders Information on Four Voting Issues — Election of Directors — Advisory Vote on Compensation — Ratification of External Auditor — Stockholder Proposal to Amend Proxy Access 2 Letter from Independent Directors The Allstate Corporation 2775 Sanders Road April 12, 2021 Northbrook, IL 60062 Fellow Stockholders, As independent directors, we ensure Allstate fulfills its long-term responsibilities to stockholders, customers, employees and society. Amidst the pandemic and changing expectations of business in 2020, Allstate adapted business practices, advanced important strategic initiatives, earned attractive returns and provided significant cash returns to stockholders. The Board also adapted by increasing the breadth and frequency of interactions with management and expanding its oversight. To support transparency and accountability to you, this letter summarizes the Board’s efforts over the last year. Successful Pandemic Response Effective risk management practices prepared Allstate to promptly respond to the pandemic as management had previously assessed pandemic risks as part of its Extremely Low Frequency Scenarios (ELFS) analysis. In March, business continuity plans were executed with over 95% of employees enabled to work from home while maintaining internal controls and productivity throughout 2020. To serve customers, the company led the industry in returning premiums to customers of almost $1 billion, allowed deferred payments, extended additional insurance coverage and provided free identity protection. Technology was leveraged so that claims could be settled virtually in order to keep customers and employees safe. The Board received frequent updates on the investment portfolio, internal controls, compliance risks, operating results, financial statement implications and senior leadership contingency plans. We are expanding the evaluation of ELFS by the risk and return committee based on recent learnings. Additionally, the executive compensation program was reviewed to determine if any changes were needed in light of the pandemic, and it was concluded that no changes were necessary. Despite challenges posed by the Coronavirus pandemic, Allstate had excellent financial results in 2020 with Adjusted Net Income* of $4.6 billion, reflecting lower frequency of auto accidents, partially offset by increased catastrophe losses. Enhancing Strong Human Capital Practices Allstate has strong human capital management practices that create an inclusive and highly ethical culture. Inclusive Diversity results at Allstate have historically been at or above average on most external measures. In 2020, the company expanded Inclusive Diversity to include Equity and committed to further improvements. The Board had multiple conversations regarding this direction, including devoting half a day of a strategic offsite to engage with a diversity thought leader and evaluate the company’s plans. In addition, multiple other actions were taken in 2020: • Expanded Resources – In the summer, management took action to reflect, learn and act. An Anti-Racism Resource Center was launched, over 20,000 employees enrolled in additional diversity training, Juneteenth was made a company holiday, and funding was increased for Employee Resource Groups. A top-to-bottom review of operating practices, pay and promotions for people of color and women was also undertaken. * Measures used in this proxy statement that are not based on generally accepted accounting principles (“non-GAAP”) are denoted with an asterisk (*). For definitions of these terms, please see the definitions of non-GAAP measures on pages 93-96 of our 2021 Proxy Statement. 2021 Proxy Statement 3 Letter from Independent Directors • Inclusive Diversity & Equity (IDE) Strategy – A three-year IDE strategy is being developed with measurable goals that will be reviewed by the Board. • Pay Equity Assessment – An independent firm was engaged to use statistical analysis on actual compensation of employees by group to identify any pay bias. Allstate’s results compared well to peers, and any gaps were remediated. • Supporting External Progress – Allstate helped increase diversity on Wall Street by forming a debt syndicate exclusively of minority-, women-, and veteran-owned banking enterprises that successfully issued $1.2 billion of bonds for the company. Allstate is also a founding member of OneTen, a group of leading corporations and other organizations committed to providing attractive career opportunities for one million Black Americans by 2030. Cultural enhancements to build transformative growth businesses are also being pursued. In 2019, we expanded the Board’s focus on culture by adding it as a key risk category. Allstate’s Our Shared Purpose was refreshed in 2020 in consultation with the Board and will be the basis for driving cultural change. Leadership succession is also a key responsibility that we discuss four times a year. These reviews range from organizational sustainability, to individual leadership development and succession plans, to scenario planning for unexpected events. There is much IDE work underway and we look forward to updating you on our continued progress across a wide spectrum of initiatives, including the inclusion of more diverse businesses in the supplier diversity program. Overseeing a Winning Strategy The company made great progress on executing the strategy of increasing market share in personal property-liability and expanding the protection solutions offered to customers. The property-liability business is being positioned for transformative growth by expanding customer access, improving customer value, increasing marketing sophistication and investment and deploying new technology ecosystems. The acquisition of National General builds a solid growth platform in the independent agent distribution of property-liability solutions and improves overall corporate returns. The Board and management also spent considerable time in 2020 considering the disposition of the life and annuities business, with agreements signed in 2021 to sell most of this business. The Board oversaw the continued execution of the Transformative Growth strategy, a multi-year initiative to increase market share in the personal property-liability business. Balancing Risk and Return • Operating Performance – Allstate had excellent operating and financial results in 2020 generating Net Income of $5.5 billion and Adjusted Net Income* of $4.6 billion. Adjusted Net Income Return on Equity* was 19.8%. As a result, we were able to pay stockholder dividends of $668 million, and 5.5% of the outstanding common shares were repurchased for $1.7 billion in 2020. • Compensation – To better align long-term compensation with stockholder interests, a relative total shareholder return performance metric was added to the long-term performance-based stock awards (“PSA”) in 2020. A policy growth metric has been added to the PSA performance measurements for the 2021 awards. In addition, Allstate’s CEO voluntarily decreased his change in control severance multiplier from three times to two times the sum of base salary and target annual incentive. • Cybersecurity – The audit committee continues the industry leading practice of using a third-party advisor to enhance cybersecurity oversight. 4 www.allstateproxy.com Letter from Independent Directors Leading Environmental, Social and Governance (“ESG”) Practices DONALD E. BROWN • Climate Change – Allstate has actively worked to remediate the impacts of climate change for over two decades, mitigating the impact of severe weather on customers and insurance returns. The risk and return committee reviewed the impact of climate change on the company’s short and long-term strategies. KERMIT R. CRAWFORD • Political Engagement – The company is extensively regulated at the state level and impacted by federal legislation. As a result, it participates in legislative processes to ensure it can effectively and efficiently meet the needs of customers and stockholders. This activity is reviewed semi-annually, and the chief risk officer does an annual review MICHAEL L. ESKEW of the risk and return of this activity for the Board. • Scope and Reporting – The Board increased its interaction with management with ten board meetings, 28 committee meetings and two informational sessions to keep RICHARD T. HUME abreast of a rapidly changing external environment. Social responsibility oversight was added to the nominating, governance and social responsibility committee’s responsibilities. We are also developing a three-year ESG plan and reporting results using the Global Reporting Initiative, Sustainable Accounting Standards Board and EEO-1 reporting frameworks. MARGARET M. KEANE • Stockholder Engagement – Proactive engagement with stockholders on governance issues remains a core practice with interactions with investors that hold over 40% of outstanding shares. SIDDHARTH N. (BOBBY) MEHTA We welcomed two new members to the Board. Both have strong operational leadership and strategic capabilities to support the execution of Transformative Growth. Richard Hume also brings an extensive technology background and Donald Brown brings JACQUES P. PEROLD financial