Timken : Annual Corporate Governance Review

Published: 2025-03-24 13:21:08 ET TKR

Annual Corporate

Governance

Review

The Timken Company

Company Overview

Celebrated 125 years in 2024 since our founding NYSE listed since 1922

Leader in Engineered Bearings and Industrial Motion 19K Employees Operating in 45 Countries

102+ Years of Continuous Quarterly Dividends $4.6B Revenue

1.9% Dividend Yield(1)

Key Brands

Sales by Geography(2)

56% Americas

24% Europe, Mid-East,

Africa (EMEA)

20% Asia-Pacific

Business Segment Sales(2)

Channel Overview(2)

66%

Engineered Bearings

55%

Original Equipment Customers

34%

Industrial Motion

45%

Distributors/End-Users

Experienced and Diverse Executive Officer Team

Tarak B. Mehta

President and

Chief Executive Officer

Over 30 years of industry experience

Christopher A. Coughlin

Executive Vice President, President of Industrial Motion

41 years at Timken

Philip D. Fracassa

Executive Vice President, Chief Financial Officer

19 years at Timken; over 30 years of industry experience

Andreas Roellgen

Executive Vice President and President of Engineered Bearings

27 years at Timken

Hansal N. Patel

Executive Vice President, General Counsel and Secretary

13 years at Timken; 20 years of industry experience

Natasha Pollock

Vice President,

Chief Human Resources Officer

23 years at Timken

Highly Qualified, Diverse Board of Directors

John M. Timken, Jr.

Tarak B. Mehta

Maria A. Crowe

Elizabeth A. Harrell

Richard G. Kyle

Sarah C. Lauber

Todd M. Leombruno

Independent Chairman,

President and

Retired President of

Retired Major General

Retired President and

Executive Vice President,

Executive Vice President

Board of Directors

Chief Executive Officer

Manufacturing Operations

U.S. Air Force

Chief Executive Officer

- Chief Financial Officer

and Chief Financial Officer

The Timken Company

Eli Lilly and Company

The Timken Company

Douglas Dynamics, Inc.

Parker Hannifin Corp.

Christopher L. Mapes

James F. Palmer

Ajita G. Rajendra

Kimberly K. Ryan

Frank C. Sullivan

Ward J. Timken, Jr.

Retired Executive Chairman,

Retired Corporate Vice President

Retired Executive Chairman,

President and

Chairman and

Chief Executive Officer

President and Chief Executive

and Chief Financial Officer

President and Chief Executive

Chief Executive Officer

McKinley Strategies LLC

Officer

Northrop Grumman Corporation

Officer

Hillenbrand, Inc.

RPM International Inc.

Lincoln Electric Holdings, Inc.

A. O. Smith Corporation

Highly Independent, Diverse Board

Committee Memberships

Name and Title

Age

Director Since

Independent

Audit

Compensation

Nominating &

Corporate Governance

Maria A. Crowe

2014

✓

Retired President of Manufacturing Operations, Eli Lilly and Company

Chair

Elizabeth A. Harrell

2017

✓

Retired Major General, U.S. Air Force

Richard G. Kyle

2013

Retired President and Chief Executive Officer, The Timken Company

Sarah C. Lauber

2021

✓

✓ (QFE)

✓

Executive Vice President - Chief Financial Officer, Douglas Dynamics, Inc.

Todd M. Leombruno

2024

✓

✓ (QFE)

✓

Executive Vice President and Chief Financial Officer, Parker Hannifin Corp.

Christopher L. Mapes

2014

✓

Retired Executive Chairman, President and Chief Executive Officer, Lincoln Electric Holdings, Inc.

Tarak B. Mehta

2024

President and Chief Executive Officer, The Timken Company

James F. Palmer

2015

✓

✓ (QFE)

✓

Retired Corporate Vice President and Chief Financial Officer, Northrop Grumman Corporation

Chair

Ajita G. Rajendra

2014

✓

Retired Executive Chairman, President and Chief Executive Officer, A. O. Smith Corporation

Chair

Kimberly K. Ryan

2025

✓

President and Chief Executive Officer, Hillenbrand, Inc.

Frank C. Sullivan

2003

✓

Chairman and Chief Executive Officer, RPM International Inc.

John M. Timken, Jr.

✓

1986

Independent

Chairman, Board of Directors, The Timken Company

Chairman

Ward J. Timken, Jr.

2002

✓

Chief Executive Officer, McKinley Strategies, LLC

Other Public

Boards

Board Composition Overview

GENDER AND ETHNIC

DIVERSITY

Gender Ethnic Other

Over 45% of Board Members are diverse by either gender or ethnicity

INDEPENDENCE

LEADERSHIP

REFRESHMENT

2/3 of Committee

3 new Directors

85%

Chairs are

within the

ethnically or

gender diverse

past year

Representative Skills and Attributes of our Board

LEADERSHIP AND GOVERNANCE

Senior leadership experience at a large organization, including current or former service as a public company officer (CEO, CFO, etc.) or high-ranking military officer, or other public company board service leading to valuable insight on corporate governance matters

HUMAN CAPITAL MANAGEMENT

Expertise in talent management, public company compensation structures, key employee development and retention, and executive succession planning

GLOBAL OPERATIONS

Service in a leadership role with multinational companies or in global markets, leading to a deep knowledge of global industry dynamics and international supply chain management

MANUFACTURING AND ENVIRONMENTAL MANAGEMENT

Expertise in manufacturing operations and logistics and environmental management to drive operating performance through sustainable means

FINANCIAL REPORTING AND CAPITAL ALLOCATION

Experience in the finance function of an enterprise, including an in-depth understanding of financial management, financial reporting and capital allocation processes

MARKETING AND SALES

Expertise in marketing, sales, and customer service in a business-to-business (B2B) context

CORPORATE SOCIAL RESPONSIBILITY

Experience with management oversight of

STRATEGY AND M&A

Responsibility for driving growth through innovative strategic initiatives and through acquisitions and other business combinations

RISK MANAGEMENT

Experience with risk management and compliance oversight relevant to the exercise of fiduciary responsibilities

GEOPOLITICAL AND GOVERNMENT AFFAIRS

Experience with geopolitical uncertainty and managing governmental and regulatory affairs in a complex global business environment

INFORMATION SECURITY

Expertise in managing the information security and data privacy functions of complex organizations

Strong Corporate Governance Practices

BOARD INDEPENDENCE

DIRECTOR ELECTIONS

BOARD PRACTICES

SHAREHOLDER RIGHTS

OTHER BEST PRACTICES

Executive Compensation Philosophy - Pay for Performance

and Strong Alignment with Shareholders

We design our executive compensation program to help us attract, motivate, reward and retain highly qualified executives who are capable of creating and sustaining value for our shareholders over the long term.

OBJECTIVES

PHILOSOPHY

▪ Align the interests of our executives and shareholders

▪ Recognizing that our employees are our most important resource

▪ Reward sustained, strong business results

▪ Rewarding results linked to both short- and long-term performance

▪ Incentivize profitable growth and capital deployment discipline

(pay-for-performance)

▪ Positioning our pay to be competitive in the marketplace

▪ Attract, retain and motivate the best talent

▪ Focusing on increasing shareholder value

Consistent, Strong Support of Named Executive Officer Compensation

96%

97%

98%

96%

2020

2021

2022

2023

2024

Compensation Best Practices

What We Do

What We Do Not Do

We utilize stock ownership requirements for executives (7x

We do not provide excise tax gross-ups under named

base salary for CEO and 3x for the other named executive

executive officer severance agreements

officers)

We have a standalone clawback policy that provides for the

recovery of excess compensation as required by the SEC

We do not allow hedging or pledging of our shares

and NYSE while also incorporating additional clawback and

forfeiture provisions

We use shareholder-approved plans to provide short- and

We do not have employment agreements for our named

long-term incentives

executive officers*

We use different metrics for short- and long-term incentive

plans that are designed to align pay with performance,

We do not have single-trigger accelerated vesting

including relative TSR for long-term incentive compensation

We provide very limited perquisites

We stopped providing defined benefit pension programs to

newly appointed executive officers over a decade ago*

We have a standard minimum one-year vesting period on all

regular, annual equity grants (in addition to any other criteria

for vesting)

*Note: Excludes statutorily mandated employment contracts and pension benefits provided in certain jurisdictions outside the United States.

Disclaimer

The Timken Co. published this content on March 24, 2025, and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on March 24, 2025 at 17:20:10.203.