UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

SCHEDULE 14A

Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934 (Amendment No. )

Filed by the Registrant [X]
Filed by a Party other than the Registrant [_]

Check the appropriate box:

Quest Diagnostics Incorporated

Payment of Filing Fee (Check the appropriate box):

The Quest Way

	Working together to create a healthier world, one life at a time
		We help people make the best decisions to improve health by providing high-quality and affordable diagnostic testing insights and services using our scale and extensive reach   •       Collaborating with payers, providers and partners to leverage our broad access •       Offering the most extensive menu of testing and services •       Leveraging our data assets and services to improve population health and enable value-based care •       Continuously improving our quality and efficiency by embracing AI, automation and other innovative technologies   Who we serve: Patients, Consumers, Physicians, Hospitals, Life Sciences Companies, Employers, Insurers, Public Health Agencies, Communities. And Retailers
		Customer first, Care, Collaboration, Continuous improvement, Curiosity

April 6, 2023

Dear Fellow Stockholder:

It is my pleasure to invite you to attend Quest Diagnostics’ 2023 Annual Meeting of Stockholders (the “Annual Meeting”). At the Annual Meeting, stockholders will vote on the following, in addition to any other business as may properly come before the Annual Meeting or any adjournment or postponement thereof:

Attendance at the Annual Meeting is limited to stockholders at the close of business on March 20, 2023, or their duly appointed proxy holder.

We enclose our proxy statement, our Annual Report and a proxy card; distribution of these materials is scheduled to begin on April 6, 2023. Your vote is very important. We urge you to submit your proxy even if you plan to attend the Annual Meeting. Most stockholders may submit a proxy via mail, telephone or the Internet. Instructions on how to submit your proxy are included with your proxy card and these proxy materials. Please submit your proxy promptly.

Thank you for your continued support of Quest Diagnostics.

Sincerely,

Proxy Summary

This summary highlights information contained elsewhere in this proxy statement. This summary does not contain all of the information that you should consider, and you should read the entire proxy statement carefully before voting.

2023 Annual Meeting of Stockholders

2024 Annual Meeting of Stockholders

Stockholder proposals submitted pursuant to SEC Rule 14a-8 must be received by Quest Diagnostics Incorporated (“Quest Diagnostics,” the “Company,” “we” or “our”) by December 8, 2023.

Notice of stockholder proposals outside of SEC Rule 14a-8, including nominations (other than proxy access nominations) for the Board of Directors (the “Board”), must be received by the Company no earlier than January 18, 2024 and no later than February 17, 2024 and must comply with the requirements set forth in our by-laws. Stockholders who intend to solicit proxies in reliance on the universal proxy rules (Rule 14a-19 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) for nominations for election to the Board must comply with the additional requirements of Rule 14a-19 and our by-laws.

Notice of proxy access director nominations must be received by the Company no earlier than November 8, 2023 and no later than December 8, 2023.

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Board Nominees

The following table provides summary information about our director nominees.

Stephen H. Rusckowski, who served as our CEO and President until November 1, 2022, served as our Chairman through March 31, 2023.

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2022 Executive Compensation Highlights

Our Board is firmly committed to pay for performance. The table above outlines the main components of our compensation program for executive officers in 2022.The objectives of our program are to attract and retain talented executives who have the skills and experience required to help us achieve our strategic objectives, and to align the interests of our executives to those of our stockholders, in each case to advance the long-term interests of our stockholders. The compensation opportunity for our named executive officers is directly tied to corporate performance, including both financial and non-financial results, and individual performance. Due to anticipated volatility in the Company’s COVID-19 testing revenues in 2022, the Committee determined to measure base business revenues and COVID-19 testing revenues separately for purposes of annual incentive awards and designed the performance shares granted in 2022 to include a performance measure focused on COVID-19 revenue. We are making changes in the program, highlighted in the Compensation Discussion and Analysis, for 2023.

The average 2022 annual incentive payout for our named executive officers on our annual cash incentives under the Senior Management Incentive Plan (“SMIP”) was 131% of target. Payout on performance shares for the 3-year performance period ended December 31, 2022 was 196% of target. The following table summarizes annual incentive plan and performance share payouts for the two most recent performance periods for our named executive officers.

Our Compensation Discussion and Analysis, which includes a discussion of our program’s “Best Practices,” begins on page 30. The 2022 compensation of our named executive officers is set forth in tables beginning at page 45.

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2022 Business Performance Highlights

Leveraging our Capabilities and Collaborating

Continuous Improvement

Disciplined Capital Deployment

Management Transition

On November 1, 2022, James E. Davis, previously Executive Vice President, General Diagnostics, was appointed Chief Executive Officer and President of the Company, succeeding Stephen H. Rusckowski, who served as our Chief Executive

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Officer and President for more than a decade. Mr. Davis became Chairman of the Board on April 1, 2023, succeeding Mr. Rusckowski, who served as Chairman of our Board through March 2023.

On July 11, 2022, Sam A. Samad joined our Company as an Executive Vice President and, on July 25, 2022, became our Chief Financial Officer. Mr. Samad succeeded Mark Guinan, who in February 2022 announced his intention to retire.

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Contents

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Information About Our Corporate Governance

Proposal No. 1 — Election of Directors

The Board of Directors recommends that you vote   FOR each of the nominees described below

Our Board currently has nine directors. Directors are elected annually for a one-year term concluding on the date of the next annual meeting of stockholders. Each director holds office until his or her successor has been elected and qualified or the director’s earlier resignation, death or removal.

Our Company recently completed a management transition. James E. Davis became Chief Executive Officer and President of the Company effective November 1, 2022 and Chairman of the Board effective April 1, 2023. Mr. Davis succeeded Stephen H. Rusckowski, who served as our Chief Executive Officer and President for more than a decade, and also served as Chairman of our Board until he retired on March 31, 2023. The Board is grateful to Mr. Rusckowski for his many contributions to our Company.

On July 11, 2022, Sam A. Samad joined our Company as an Executive Vice President and, on July 25, 2022, became our Chief Financial Officer. Mr. Samad succeeded Mark Guinan, who in February 2022 announced his intention to retire.

After considering the recommendation of the Governance Committee, the Board nominated the nominees below to serve as directors of Quest Diagnostics. Each nominee, other than Dr. Diaz, currently is a director of the Company whose term expires at the Annual Meeting. The Board nominated Dr. Diaz for election for the first time at the Annual Meeting. The Governance Committee evaluated several candidates as potential director nominees. After directors interviewed Dr. Diaz, the Governance Committee unanimously recommended to the Board that Dr. Diaz be nominated to be a director. The biography of each nominee contains information regarding the person’s service as a director of the Company, business experience, other public company director positions and the experience, qualifications, attributes and skills that led the Board to conclude that the person should serve as a director of the Company. The Board believes that each nominee possesses the qualities and experience that nominees should possess in accordance with the Company’s Corporate Governance Guidelines, which set forth the Company’s philosophy regarding Board composition and identify key qualifications and other considerations for the nomination of directors (the relevant portion of the Company’s Corporate Governance Guidelines is set forth below under the heading “Board Nomination Process” beginning on page 9). Each nominee has consented to serve if elected.

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THE BOARD OF DIRECTORS RECOMMENDS THAT YOU VOTE FOR EACH NOMINEE. PROXIES SOLICITED BY THE BOARD WILL BE VOTED FOR EACH NOMINEE UNLESS OTHERWISE INSTRUCTED.

Governance Practices

The Board believes that good corporate governance, designed to protect and enhance stockholder value, is important. The Company has strong corporate governance structures, processes, policies and practices. We engage with our stockholders and listen to their concerns. Our Board benefits from knowledgeable independent directors.

The Board has adopted Corporate Governance Guidelines to enhance its own effectiveness and to demonstrate its commitment to strong corporate governance for the Company. The Board reviews these Guidelines no less frequently than annually, including in response to changing regulatory requirements, evolving practices and the concerns of our stockholders. The Company also has adopted a Code of Ethics applicable to all directors, officers and employees. The Corporate Governance Guidelines and Code of Ethics are published on our website at www.QuestDiagnostics.com. The information on or accessible through our website is not incorporated by reference in this Proxy Statement.

		Commitment to board refreshment – eight new directors since 2014, including with significant CEO experience
		Eight of nine directors are independent (our CEO and President is our only non-independent director)
		Five of nine directors are women or ethnically diverse
		Cybersecurity Committee of the Board since 2019
		Annual election of entire board
		Majority voting standard for director elections
		Annual assessment of Board and Committee structure and performance
		Lead Independent Director with clearly defined role and robust responsibilities
		Regular executive sessions for independent directors only, presided over by Lead Independent Director
		Independent directors receive a majority of their annual compensation in equity to further align their interests with our stockholders’ interests
		Committee assignments are regularly reviewed and selected with a view to continuity and diversity
		Annual reviews of succession planning and development of management personnel

		Proxy access right for stockholders
		Right to request that the Company call a special meeting of stockholders
		Right to act by written consent
		No “poison pill” stockholders’ rights plan
		No supermajority voting requirements
		Annual say-on-pay vote
		Active stockholder engagement

		Committees report on their activities to the Board at each Board meeting
		Director education programs conducted by third parties provided for our directors
		Public disclosure of corporate political contributions policy and information regarding corporate political expenditures
		Board materials provided to directors in advance of meetings to allow preparation for discussion of items
		Board portal enhances the Board’s efficiency, access to information, security and communication
		Independent directors have unlimited access to officers and employees of the Company
		Board and committees have access to and the authority to retain independent legal, financial or other advisors

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Corporate Responsibility

The Company and the Board take seriously the responsibility of corporate stewardship, which includes creating a healthier world and building value for all stakeholders. The Company has a deep commitment to its patients, employees, communities and the environment. The Company aims to do business in an environmentally sustainable, socially responsible manner and make a difference in the communities in which it operates. We maintain a Corporate Responsibility webpage, www.QuestDiagnostics.com/our-company/corporate-responsibility, that provides information about our corporate responsibility program, including our focus on environmental, social and governance (“ESG”) issues. The information on or accessible through our website is not incorporated by reference in this Proxy Statement.

		Approximately 72% of employees identify as women and approximately 50% of U.S.  employees identify as people of color
		Ten Employee Business Networks (including African-American Business Leaders, DiverseAbilities, Hispanic/Latino, Pan Asian Leaders and Women in Leadership) that work closely with our talent acquisition team to bring in diverse talent and support them through targeted mentoring and training programs
		Initiatives to conserve resources and minimize the negative impact of our operations and facilities on the environment through pollution prevention, energy efficiency, fleet conservation, and strategic sourcing
		Environment, Health and Safety program reduces risk of employee injury
		Patient Assistance Program tailors solutions for uninsured or underinsured patients based on individual circumstances
		“Action with Integrity” Code of Ethics reflects the Company’s commitment to operate as a trustworthy, transparent and ethical organization
		Collaborations with nonprofit organizations improve access to care through donated services, charitable giving, and thought leadership
		Quest for Health Equity, a $100 million-plus initiative to help reduce health disparities in underserved American communities
		Employee volunteer program Quest Community Action Network, with chapters across the country, has raised millions of dollars for worthwhile causes
		Support employee service with the Company’s Matching Gifts programs, which provide funds to hundreds of nonprofit organizations that share the Company’s commitment to empowering better health and fostering inclusion
		Named as one of Fortune’s World’s Most Admired Companies in 2023 for the ninth consecutive year
		Named a Best Place to Work for LGBTQ Equality, based on the Human Rights Campaign Foundation Corporate Equality Index 2022
		Ranked as one of Forbes America’s Best Large Employers in 2023
		Named one of America’s Greatest Workspaces for Diversity in 2023 by Newsweek

Director Independence

The Board assesses the independence of each director annually, and of each director nominee, in accordance with the Company’s Corporate Governance Guidelines and New York Stock Exchange (“NYSE”) listing standards. The independence guidelines in the Corporate Governance Guidelines are consistent with the independence requirements in the NYSE listing standards and include guidelines as to categories of relationships that are considered not material for purposes of director independence.

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All members of the Audit and Finance Committee, the Governance Committee, and the Compensation and Leadership Development Committee must be independent under NYSE listing standards and the Company’s Corporate Governance Guidelines. Pursuant to the charters of the Audit and Finance Committee and the Compensation and Leadership Development Committee, respectively, members of these committees also must satisfy separate independence standards based on requirements of the Securities and Exchange Commission (“SEC”) and NYSE, respectively.

The Board has determined that a substantial majority (eight of nine) of our directors, as well as our new director nominee, Dr. Diaz, are independent. Each member, including the chair, of each of the Audit and Finance Committee, the Compensation and Leadership Development Committee, the Governance Committee, the Cybersecurity Committee and the Quality and Compliance Committee qualifies as independent, including under the committee-specific independence requirements discussed above. In making its determinations as to the independence of the directors, the Board reviewed relationships between the Company and each of them. The Board considered the ordinary course commercial relationships in the last three years between the Company and the entity of which Mr. Lassiter is an executive officer and determined that these relationships did not exceed the thresholds under the NYSE listing standards and did not otherwise impair Mr. Lassiter’s independence.

The Board has determined the following directors and nominee to be independent:

	Luis A. Diaz, Jr., M.D.		Denise M. Morrison
	Tracey C. Doi		Gary M. Pfeiffer
	Vicky B. Gregg		Timothy M. Ring
	Wright L. Lassiter III		Gail R. Wilensky, Ph.D.
	Timothy L. Main

Mr. Davis, who is the Company’s Chairman, Chief Executive Officer and President, is not independent.

Stockholder Access and Outreach

Stockholders and any other person may communicate with the Board by sending comments to our Lead Independent Director through the web form available at www.questdiagnostics.com/contact-us/lead-independent-director, or by writing to the full Board or any individual director or any group or committee of directors, c/o Corporate Secretary, 500 Plaza Drive, Secaucus, New Jersey 07094. Communications received are reviewed by the Corporate Secretary and handled in accordance with protocols approved by the Governance Committee and forwarded to the intended directors as appropriate.

We have a program of ongoing dialogue with our investors and regularly reach out to large stockholders to listen to their concerns and to inform them about the Company. Our Board receives reports regarding these discussions. During the past year, we reached out to stockholders holding approximately two-thirds of the Company’s outstanding common stock, and held discussions with those that accepted our invitation and others that reached out to us. These discussions addressed topics such as corporate governance, executive pay, company strategy and the Company’s approach to other ESG issues. During these discussions during the past year, investors generally shared positive feedback regarding the Company’s structuring of and overall approach to corporate governance and executive pay, as well as the other topics discussed. Further, our Corporate Governance Guidelines publicly affirm the Board’s long-standing approach of being available for discussions with stockholders in appropriate circumstances.

The Audit and Finance Committee maintains a procedure whereby complaints and concerns with respect to accounting, internal controls and audit matters may be submitted to the Audit and Finance Committee. All communications received by a director relating to the Company’s accounting, internal controls or audit matters are immediately forwarded to the Chair of the Audit and Finance Committee and are investigated and responded to in accordance with the procedures established by the Audit and Finance Committee. In addition, the Company has established a hotline (known as CHEQline) pursuant to which employees can anonymously report accounting, internal controls, and financial irregularities (as well as compliance concerns on other laws, and other issues).

Our Corporate Governance Guidelines provide that directors are encouraged and expected to attend the Annual Meeting. All our directors then in office attended the 2022 annual stockholders meeting.

Board Nomination Process

The Governance Committee is responsible for reviewing with the Board, on an annual basis, the composition of the Board as a whole and whether the Company is being well served by the directors, taking into account each director’s independence, skills, experience, tenure, availability for service to the Company and other factors the Governance Committee deems appropriate. The Governance Committee is responsible for recommending director nominees to the

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Board, including re-nomination of persons who are already directors. The Governance Committee does not set specific, minimum qualifications that nominees must meet in order for the Governance Committee to recommend them to the Board, but rather believes that each nominee should be evaluated based on his or her own merits, taking into account the Company’s needs, Board succession planning considerations, and the overall composition of the Board, which includes an analysis of current directors’ skills and experience. Recommendations are made by the Governance Committee in accordance with the Company’s Corporate Governance Guidelines, which set forth the Company’s philosophy regarding Board composition and identify key qualifications and other considerations. The Governance Committee believes that the Board should be comprised of individuals whose backgrounds and experience complement those of other Board members, and considers whether a prospective nominee promotes a diversity of talent, skill, tenure, expertise, background, perspective and experience, as well as diversity with respect to age, gender identity, race, ethnicity, place of residence, sexual orientation and specialized experience. The Governance Committee does not assign specific weights to particular criteria and nominees are not required to possess any particular attribute.

The key qualifications and other considerations set forth in the Company’s Corporate Governance Guidelines are set forth below.

In recruiting and selecting a Board candidate, as a supplement to the key qualifications and other considerations for director candidates outlined in the Corporate Governance Guidelines, the Governance Committee considers other important skills and professional experiences to determine whether a candidate has skills and experience well-suited for the expected needs of the Board, including whether the skills and experience complement those of the other Board members or nominees. The table below includes, for each director nominee, an illustrative, non-exhaustive listing of supplemental skills and experiences that the Board considered most relevant when nominating that nominee. Although a check mark indicates that the Board relied upon the specific skill or experience in making its decision, the absence of a check mark does not mean the nominee does not possess the specific skill or experience. The biographies beginning on page 2 provide more information on each nominee’s skills and experience. The table also provides self-identified demographic and tenure information regarding each nominee.

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The Governance Committee regularly reviews the Board’s composition to ensure that we continue to have the right mix of skills, diversity, background and tenure reflected on the Board. Our Board’s membership represents a balanced approach to director tenure, allowing the Board to benefit from the experience of longer-serving directors as well as the fresh perspectives of newer directors. The composition of the director nominee group (assuming Dr. Diaz’s election at the Annual Meeting) with respect to tenure and ethnic and gender diversity are shown below:

The Board is committed to fostering diversity of the Board. In addition to valuing diversity of talent, skill, tenure, expertise and experience, the Board seeks to include directors with diverse backgrounds, including with respect to race, ethnicity, age, gender identity and sexual orientation, in order to ensure that diverse perspectives are included on the Board. When conducting searches for new directors, it is the Board’s policy to actively and routinely seek a diverse candidate pool, including women and ethnically diverse candidates. The Board assesses the effectiveness of this process each time a new director is nominated to join the Board.

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The Governance Committee considers suggestions from many sources, including stockholders, regarding possible candidates for director. Stockholders may recommend candidates for consideration as director by sending comments to our Lead Independent Director through the web form available at www.questdiagnostics.com/contact-us/lead-independent-director or writing to the full Board or any independent Board member, c/o Corporate Secretary, 500 Plaza Drive, Secaucus, New Jersey 07094. The recommendation should contain the proposed nominee’s name, biographical information and relationship to the stockholder. The Governance Committee evaluates stockholder recommendations for director candidates in the same manner as other director candidate recommendations. Stockholders may also nominate director candidates. See “Frequently Asked Questions” beginning on page 77 for information regarding the process and deadline for stockholders to submit director nominations for the 2024 annual meeting of stockholders.

Board Committees

During 2022, the Board held nine meetings. In order to fulfil its responsibilities, the Board has delegated certain authority and responsibilities to its six standing committees. The Board’s structure and operations reflect its alignment on ESG issues. The Board holds primary responsibility for oversight of human capital management issues, as reflected in the Corporate Governance Guidelines. The Board expects to continue to monitor developments related to ESG issues and whether its allocation of responsibilities remains appropriate. Recently the Board renamed the Compensation Committee the Compensation and Leadership Development Committee and revised the committee’s charter to include leadership development for senior management other than the Chief Executive Officer. As discussed under the heading “Board, Committee and CEO Evaluation Process” beginning on page 17, each committee reviews its own performance.

In 2022, each nominee attended at least 75% of the meetings of the Board and the Board committees on which he or she served held during the period such nominee was in office. Any director may attend meetings of any committee of which the director is not a member.

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For each year, a schedule of Board meetings is established before the year begins. Committee meetings are generally scheduled for shortly before, or the day of, meetings of the full Board, except that meetings of the Executive Committee are scheduled only when needed. The Board and each committee also hold such additional meetings as the Board or committee, respectively, determines necessary or appropriate. Set forth below is a brief description of each standing committee and its function, its membership and the number of meetings it held during 2022. The Board will identify committee appointments for Dr. Diaz following his election to the Board. Additional information about the committees can be found in their charters, which are available on our website at www.QuestDiagnostics.com.

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Board Leadership Structure

At Quest Diagnostics, we recognize the importance of good corporate governance and value the leadership and input of the independent members of our Board. The Board believes that its leadership structure should be determined by what is in the best interest of the Company. The Board does not have a policy that requires the combination or separation of the Chair and Chief Executive Officer roles. The Board has revised its leadership structure from time to time and retains the flexibility to revise its leadership structure if, in the exercise of its fiduciary duties, the Board believes that such revision is appropriate. Currently, the roles of Board Chair and Chief Executive Officer are combined with James E. Davis. The Board believes that Mr. Davis’ long tenure with the Company in multiple roles and his extensive industry experience make him well-suited to facilitate the Board’s oversight of our operations, strategy and risk. In accordance with the Company’s Corporate Governance Guidelines, where the Board Chair is not an independent director, the independent directors designate a Lead Independent Director, who has a robust set of responsibilities set forth in our Corporate Governance Guidelines and described below under the heading “Principal Responsibilities of the Lead Independent Director,” and who assists with the administration and organization of the Board and facilitates the effective performance of its duties, including the activities of the independent directors. The independent directors have selected Timothy M. Ring to serve as Lead Independent Director.

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We also have other mechanisms in place to promote the appropriate level of independence and oversight in Board decisions. See “Corporate Governance Highlights” on page 7.

Board Oversight of Company Culture and Human Capital

The Board is committed to fostering a strong culture of compliance and ethical conduct and has structured its committees and their activities to support its commitment. The Board supports management’s promotion of a corporate culture of integrity, ethical behavior and compliance with laws and regulations and efforts to ensure that the Company’s culture and its strategy are aligned. The Board expects all directors, as well as officers and employees, to conduct themselves in a manner consistent with our Code of Ethics and our values. The Board believes that a strong culture of integrity, ethics and compliance is fundamental to the conduct of the Company’s business, and is necessary for effective risk management, maintaining investor trust, and successful corporate governance.

We have long strived to create an inspiring workplace, and this has driven our approach to human capital management. Effectively managing our human capital resources is a priority with key components that include culture, safety and well-being programs, employee engagement, and development and succession planning. Our Board actively engages in oversight of our human capital management, including by receiving management reports on key areas, strategies and initiatives. Additional information about our human capital management strategies and initiatives is available in our 2022 Annual Report on Form 10-K and our 2021 Corporate Responsibility Report, each of which is available on our website at www.QuestDiagnostics.com.

Board, Committee and CEO Evaluation Process

The Board annually conducts a self-evaluation of its performance and effectiveness. The charter of each standing committee of the Board, discussed under the heading “Board Committees” beginning on page 12, calls for the committee to conduct an annual self-evaluation of its performance, and report to the Board the results of the self-evaluation. The Governance Committee is tasked with establishing criteria and processes for and overseeing the annual self-evaluation of the Board and the committees. Each year, the Governance Committee discusses the appropriate approach for that year’s Board and committee evaluations.

Prior to the meeting at which each annual self-evaluation occurs, each member of the Board and the committees receives a discussion outline, which encourages the directors to consider the Board’s or committee’s structure, processes, overall effectiveness, and improvement since the previous year’s assessment. In addition, our General Counsel discusses individually with each director, and with members of our senior management, the self-evaluation items and compiles feedback received for discussion with the Lead Independent Director and the full Board. At the meeting, the Lead Independent Director or the committee chair, as applicable, leads a discussion guided by the outline provided, and the Board or committee, as applicable, identifies action items as well as items for further review.

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Periodically, the Board engages an independent consultant to assist with the evaluation, including evaluating individual director performance. When the Board evaluates individual director performance, input from other directors and senior management is considered, in a process that protects anonymity to ensure honest feedback. In these situations, the independent consultant and the Lead Independent Director together review the results of the individual director evaluations with the individual directors. The Lead Independent Director reviews the remaining items with the Board and assists the Board in identifying action items as well as items for further review.

In addition, the Compensation and Leadership Development Committee, pursuant to its charter, conducts an annual review of the Chief Executive Officer’s performance, receives input on the review from the Board, and reports the results of its review to the Board. Pursuant to our Corporate Governance Guidelines, the Board, led by the Lead Independent Director, reviews the Compensation and Leadership Development Committee’s report in order to ensure that the Chief Executive Officer is providing the necessary leadership for the Company in light of the Company’s current and longer-term goals. The Board then provides feedback to the Chief Executive Officer regarding his performance.

Board Role in Risk Oversight

The Board and its committees play an active role in overseeing the Company’s key risks. As highlighted in the table below, the Board has delegated primary responsibility for overseeing our enterprise risk management program to the Audit and Finance Committee, and has assigned oversight of specific risks to the Board committee with the appropriate subject matter responsibility, as set forth in the committee charters. The Board has also considered its role in risk oversight in determining the current Board leadership structure. The Company’s management is responsible for risk management, which it does through a committee of senior managers that leads the Company’s enterprise risk management program. The program includes a formal continuous process that identifies, assesses, mitigates and manages the risks from both internal and external conditions that could significantly impact the Company and influence its business strategy and performance, including ESG issues. The program is designed to focus on the Company’s key risk types, which are: operational; financial; legal and compliance; and strategic. The Company’s key risks currently include without limitation: medical quality, cybersecurity and business continuity. The Company’s enterprise risk management program is discussed in the Company’s Annual Report on Form 10-K.

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Related Person Transactions

The Company has a written policy pursuant to which it evaluates proposed transactions involving a related person and the Company in which the amount involved exceeds $120,000. A related person is any director or executive officer of the Company, any immediate family member of a director or executive officer, or any person who owns 5% or more of the Company’s outstanding common stock. The office of the General Counsel is primarily responsible for the administration of the policy and for determining, based on the facts and circumstances, whether the Company or a related person has a direct or indirect material interest in the transaction. Certain transactions are defined not to be related person transactions under the policy.

The Governance Committee reviews any proposed transaction in which a related person has a direct or indirect material interest, except for any compensation arrangements involving an immediate family member of a director or an executive officer. In the event that the General Counsel becomes aware of a related person transaction not approved in advance, the General Counsel will arrange for the related person transaction to be reviewed at the next regularly scheduled meeting of the Governance Committee. Any member of the Governance Committee who is a related person with respect to a transaction under review may not participate in any review, consideration or approval of the transaction.

In considering any related person transaction, the Governance Committee determines whether the transaction is fair to the Company. In considering a proposed transaction involving a director or the immediate family member of a director, the Governance Committee also assesses whether the proposed transaction could reasonably be expected to impact the independence of the director under the Company’s Corporate Governance Guidelines, the NYSE listing standards or other applicable rules.

Compensation arrangements involving an immediate family member of an executive officer are reviewed and approved by the Chief Executive Officer and the Senior Vice President, Chief Human Resources Officer, unless such person is an immediate family member of the Chief Executive Officer, in which case the compensation arrangement is approved by the Compensation and Leadership Development Committee. Compensation arrangements involving an immediate family member of a director are reviewed and approved by the Compensation and Leadership Development Committee.

During 2022, there were no related person transactions meeting the requirements for disclosure in this proxy statement.

Policies Regarding Hedging and Pledging our Common Stock; Window Periods

Our directors and executive officers are prohibited from pledging the Company’s common stock to secure a loan and from holding such stock in a margin account. Our directors and employees, including executive officers, are prohibited from entering into transactions or purchasing financial instruments that are expected to hedge or offset, or designed to hedge or offset, a decline in our common stock price, including, but not limited to, the use of financial derivatives (including, for example, prepaid forward contracts, equity swaps, collars, puts and calls or exchange funds). Our directors and employees, including executive officers, also are prohibited from entering into transactions (including, for example, short sales) that establish downside price protection for our common stock. In addition, our directors and executive officers, as well as certain other employees, generally may purchase or sell Company securities only during permitted window periods (generally beginning on the business day following the issuance of our quarterly earnings releases and continuing until the end of the second month of the fiscal quarter).

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Director Compensation Program for 2022. The following table sets forth the 2022 compensation of our non-employee directors then in office. No changes to our director compensation program were made in 2022. Mr. Rusckowski and Mr. Davis, each of whom served as an employee director during 2022, received no additional compensation in 2022 for serving as director. None of our non-employee directors receives any consulting or other non-director fees from the Company.

Annual Cash Retainer Fees. During 2022, our non-employee directors received an annual cash retainer fee. Directors serving on Board committees also received additional retainers for such service, and directors who served as Lead Independent Director and committee chairs each received an additional fee for such service. All such cash retainer fees were paid at annual rates as set forth in the table below.

Equity Awards. Each non-employee director participates in the Company’s Long-Term Incentive Plan for Non-Employee Directors (the “Director Plan”). The Director Plan currently authorizes the grant to each non-employee director, on the date of the annual stockholders meeting, of stock options and stock awards covering shares of common stock having an aggregate value on the date of grant not exceeding $500,000. If a person is appointed or elected as a director other than on the date of the annual stockholders meeting, the Board may grant to such director a prorated equity award, in such proportions as the Board may determine. Annual option grants become exercisable, and annual RSUs generally vest and convert to shares of our common stock, in three equal annual installments, beginning on the first anniversary of the grant date, regardless of whether the non-employee director remains a director. The Director Plan also permits the

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Board to grant to any non-employee director an equity award for any special service as a director (e.g., service on a special purpose committee). Special service equity awards shall not exceed the grant date value of the annual equity award granted to each non-employee director at the most recent annual meeting of stockholders. The exercise price of all stock options issued under the Director Plan is the fair market value of our common stock on the grant date. Options, once vested, will be exercisable through the tenth anniversary of the date of grant even if the director’s service on the Board terminates.

For 2022, the Board fixed the value of the annual equity award to non-employee directors at $180,000 and determined that the award would be delivered entirely in the form of RSUs. The 2022 award was granted effective May 18, 2022, with each non-employee director then in service receiving an award of 1,292 RSUs.

A non-employee director may elect to receive annual retainer fees in stock awards in lieu of cash. The number of shares issued in lieu of cash for the retainer fees is based on the fair market value of the stock on the date that the cash payment would otherwise be made.

Opportunity to Defer Compensation. Under the Company’s Deferred Compensation Plan for Non-Employee Directors, each non-employee director may elect to defer, until a date specified by the director or until the director’s termination of service as a director, the director’s cash compensation or any stock grants awarded pursuant to the Director Plan. If a director specifies a deferral date that is prior to the director’s termination of service, the payout will occur or commence, as applicable, upon termination of service as a director. Cash amounts deferred may be indexed to (i) a cash account under which amounts deferred earn interest, compounded quarterly, at a rate in effect on the first date of each calendar quarter or (ii) the Company’s common stock.

Changes in Director Compensation Program for 2023. No changes were made in the compensation program for directors for 2023.

We encourage our directors, officers, and employees to own our common stock, which aligns their interests with the interests of our stockholders. The Company maintains stock ownership and retention guidelines for its directors and executive officers. The guidelines call for our directors to beneficially own not less than 6,000 shares of our common stock. Until a director satisfies the minimum shareholding requirement, directors are required to maintain 75% of net shares received from vesting of RSUs and from the exercise of options. For purposes of determining whether a director has met the minimum shareholding requirements, we count shares subject to unvested RSUs, but not shares subject to stock options. The guidelines for our executive officers are discussed in “Compensation Discussion and Analysis” beginning on page 24.

The following tables show the number of shares of the Company’s common stock beneficially owned by (1) each person who is known to the Company to own beneficially more than 5% of the Company’s common stock, (2) each director of the Company and each nominee, (3) each named executive officer currently employed, (4) each named executive officer no longer employed, and (5) all directors, nominees and named executive officers currently employed as a group. Information in the table regarding the Company’s directors, nominees and executive officers is provided as of March 8, 2023.

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2023 Proxy Statement	22

Information Regarding Executive Compensation

Proposal No. 2 — Advisory Resolution to Approve Executive Officer Compensation

Section 14A of the Exchange Act entitles stockholders to vote to approve or not approve, on an advisory (non-binding) basis, our executive officer compensation as disclosed in the Compensation Discussion and Analysis and accompanying compensation tables and narrative. We are asking stockholders to approve the following resolution:

RESOLVED, that the compensation paid to the Company’s named executive officers, as disclosed in this proxy statement pursuant to the compensation disclosure rules of the SEC, including the Compensation Discussion and Analysis, compensation tables and related narrative disclosure, is hereby APPROVED.

Pay for Performance. As discussed in “Compensation Discussion and Analysis” below, our executive compensation program is designed to pay for performance, to align the interests of our executive officers with the interests of our stockholders and to support the Company’s long- and short-term business goals. Our program reflects many “best practices,” and our executive compensation structure and levels in 2022 clearly demonstrate our commitment to aligning pay and performance.

Advisory Vote. This vote is advisory. We conduct an advisory vote to approve executive officer compensation annually; the next stockholder advisory vote to approve executive compensation will take place after considering the results of the stockholder vote on Proposal No. 3. This vote is not intended to address any specific item of compensation, but rather the overall compensation of our named executive officers and the executive compensation policies and practices described in this proxy statement. The Board and the Compensation and Leadership Development Committee value the opinions of the Company’s stockholders and will take into account the outcome of the vote, in conjunction with such other factors as the Board and the Compensation and Leadership Development Committee consider appropriate, in connection with the Company’s executive compensation program.

THE BOARD OF DIRECTORS RECOMMENDS THAT YOU VOTE FOR THIS PROPOSAL. PROXIES SOLICITED BY THE BOARD WILL BE VOTED FOR THIS PROPOSAL UNLESS OTHERWISE INSTRUCTED.

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Proposal No. 3 — Advisory Vote to Recommend the Frequency of the Executive Officer Compensation Advisory Vote

Pursuant to Section 14A of the Exchange Act, we are required, at least once every six years, to hold a stockholder advisory vote to recommend the frequency with which we conduct a stockholder advisory vote on executive compensation. This proposal gives you the opportunity to vote, on an advisory (non-binding) basis, on how often the Company will conduct a stockholder advisory vote on executive officer compensation. You may vote on whether you prefer that the Company conduct such an advisory vote every one, two, or three years. You may also vote to abstain.

Annual Vote Recommended. Our Board unanimously recommends that stockholders vote in favor of conducting the advisory vote on executive compensation required by Section 14A of the Exchange Act annually. We held our last vote to recommend the frequency of the stockholder advisory vote on executive compensation at our 2017 annual stockholders meeting. In 2017, a significant majority of our stockholders voted in favor of conducting the advisory vote on executive compensation annually, and our experience in the past six years has shown that conducting the vote every year is currently the most appropriate option. An annual vote allows stockholders to provide us with direct and immediate feedback regarding our executive compensation program. It also fosters stockholder communications and is consistent with our practice of engaging with our stockholders, and obtaining their input, on our executive compensation program. The Board is open to receiving from our stockholders at any time specific concerns regarding the Company’s executive compensation program.

Advisory Vote. This vote is advisory. The Board and the Compensation and Leadership Development Committee value the opinions of the Company’s stockholders and will take into account the outcome of the vote, in conjunction with such other factors as the Board and the Compensation and Leadership Development Committee consider appropriate, when determining the frequency of future advisory votes on executive compensation.

THE BOARD RECOMMENDS A VOTE TO CONDUCT THE ADVISORY VOTE ON EXECUTIVE COMPENSATION EVERY “ONE YEAR.” PROXIES SOLICITED BY THE BOARD WILL BE VOTED “ONE YEAR” WITH RESPECT TO THIS PROPOSAL UNLESS OTHERWISE INSTRUCTED.

Compensation Discussion and Analysis

Executive Summary

Introduction

The Compensation and Leadership Development Committee (the “Committee”) determined 2022 compensation for the Company’s named executive officers after considering, among other things, the Company’s performance (including our continued response to the COVID-19 pandemic), the competitive market for executive talent, and the current environment in the healthcare industry, including in diagnostic information services. We believe that our executive compensation structure, compensation opportunity levels, and pay outcomes in 2022 reflect our firm commitment to the core principles of our executive compensation philosophy, which is designed to motivate leaders, and to align pay with performance, the Company’s financial results and the interests of stakeholders. Our named executive officers are listed below.

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2022 Company Performance

In the third year of the COVID-19 pandemic, we continued to bring critical COVID-19 testing to our country. The nation’s demand for COVID-19 testing diminished, as expected, over the course of 2022, and that diminished demand resulted in an overall decline in 2022 from the record revenues, earnings and cash from operations the Company generated in 2021. The Company still generated $1.45 billion in COVID-19 testing revenues, and the Company’s revenues excluding revenue associated with its COVID-19 testing business (the “base business”) grew 5% in 2022. The strong growth of our base business, combined with our continued strong provision of COVID-19 testing, drove our financial performance during 2022.

Adjusted diluted EPS is a non-GAAP financial measure. See Annex A for a reconciliation to a financial measure reported under U.S. GAAP.

In 2022, Quest Diagnostics remained at the forefront of the response to the COVID-19 pandemic, playing a pivotal role to broaden access to laboratory insights to help people lead healthier and safer lives. We provided both molecular diagnostic and antibody serology tests to aid in the diagnosis of COVID-19 and the detection of immune response to the virus. From the beginning of the pandemic through December 31, 2022, we have performed approximately 77 million of these tests. We built up and maintained the testing capacity to handle surges in COVID-19 testing demands, including using our national courier, air fleet and logistics network to balance volume across approximately two dozen COVID-19 testing laboratories, and also through our laboratory referral partner program. We worked with federal, state and local governments, healthcare organizations, payers, suppliers, retailers, trade associations and other laboratories in the effort to bring as much COVID-19 testing as possible to the American people. We also provided data on COVID-19 testing that we conducted to federal, state and local public health authorities, including the U.S. Centers for Disease Control and Prevention. In addition, we participated in studies with government and private institutions, aiding COVID-19 public health response and research. All our employees, including our dedicated laboratory professionals, phlebotomists, air fleet team, and couriers took tremendous pride in the role we played and worked tirelessly to help patients and communities access quality COVID-19 testing. As the impact of COVID-19 moderates, we remain active in the continued response to COVID-19, including supporting ongoing testing needs and public health response.

We also continued to see how underserved communities were disproportionately impacted by COVID-19. Quest for Health Equity, our initiative with the Quest Diagnostics Foundation, was launched to reduce health disparities in underserved communities in the U.S. This initiative provides a combination of testing services, education programs, alliances and financial support to efforts to address health disparities. Since its inception, we have committed approximately $30 million to approximately 65 programs launched across the U.S. and Puerto Rico, including supporting COVID-19 testing and vaccination events, wellness events, educating young students on healthy nutrition choices and expanding research and mentorship opportunities for Black and Hispanic scholars. Numerous Quest for Health Equity undertakings demonstrate our commitment to federally-qualified health centers and the people they serve, including by providing free lab testing services.

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Our approach to fighting the COVID-19 pandemic has been rooted in our purpose and strategy. We believe that the challenges we faced from the COVID-19 pandemic brought us together, made us a stronger company and will help us capture the substantial opportunities in front of us. The following table highlights additional progress during 2022.

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Incentive Compensation Outcomes and Alignment with Performance

The Committee’s approach to annual incentive compensation generally has been to tie annual incentive compensation to key operating goals and to establish targets that are challenging, yet attainable. The average 2022 annual incentive payout for our named executive officers (excluding Ms. Eglinton Manner, who did not receive an annual incentive payout for 2022) on our annual cash incentives under the Senior Management Incentive Plan (“SMIP”) was 131% of target.

Payout on performance share awards for the three-year performance period ended December 31, 2022 was 196% of target. The following table summarizes annual incentive and performance share payouts for the two most recent performance periods for our named executive officers.

Our total stockholder return (“TSR”) for recent periods, relative to relevant publicly traded comparator groups, is set forth below.

The TSR shown combines stock price appreciation and reinvestment of dividends paid during the relevant performance period, thereby taking into consideration the effect of divergent dividend policies.

Taken in the aggregate, the results of our annual and long-term incentive programs demonstrate that compensation has been sensitive to Company performance. Annex B sets forth historical payouts for our annual incentive compensation and performance share awards for each year since 2005.

2022 Compensation Program Changes

In furtherance of our executive compensation philosophy, in February 2022, due to the uncertain impact of the COVID-19 pandemic on the operating environment, the Committee determined to continue to measure base business revenues and COVID-19 testing revenues separately for purposes of annual incentive compensation and performance share awards. In addition, the Committee revised the mix of equity awards for our executive officers other than our Chief Executive Officer, to further emphasize awards subject to performance conditions. The Committee determined that awards to our other executive officers, and to the remainder of our most senior employees, would consist of 50% performance shares, 25% options and 25% RSUs, mirroring the mix of awards to our Chief Executive Officer. In addition, to increase the reach of the Company’s equity awards program and its benefits, and to enhance the competitiveness of

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the Company’s compensation program, the Committee expanded the pool of employees receiving equity awards to include director-level employees.

Certain 2022 Compensation Actions Related to Management Transition

2022 was a year of significant transition in the management of our Company. The Committee took numerous actions during 2022 to foster the success of that transition. The following is a summary of compensation actions taken during 2022 that impacted certain of our named executive officers. Details regarding their compensation are discussed further below in this Compensation Discussion and Analysis.

Mr. Davis. Mr. Davis became CEO-Elect on February 3, 2022, and in February 2022, the Committee adjusted his base salary, target annual incentive and annual equity award to reflect his new position. Mr. Davis became CEO on November 1, 2022, and at that time the Committee adjusted his base salary and target annual incentive to reflect his promotion to CEO. The Committee also granted him an additional equity award, with certain terms and conditions different from his annual equity award, effective November 1, 2022 intended to provide him an incentive in his new role.

Mr. Samad. Mr. Samad joined the Company in July 2022 to become its Chief Financial Officer. At that time, the Committee established his base salary and target annual incentive and granted to him an annual equity award (structured consistent with the annual equity awards issued to our named executive officers in the normal course in February 2022) commensurate with his position. To compensate Mr. Samad for certain forfeitures incurred in connection with the termination of his employment from his immediately preceding employer and as a sign-on inducement, the Committee agreed that Mr. Samad’s annual incentive award for 2022 would be paid based on his annualized base salary, rather than his salary earned at the Company during 2022, and approved for Mr. Samad: (i) a lump-sum cash payment of $1,200,000 (the “Make Whole Cash Payment”); and (ii) a grant of restricted stock units (“RSUs”) with a value of $1,500,000 (the “Make Whole RSUs”). 50% of the Make Whole RSUs are scheduled to vest on each of the first and second anniversaries of the grant date. Mr. Samad is required to refund the Make Whole Cash Payment if he voluntarily terminates employment or if the Company terminates his employment for willful misconduct, in each case at any time prior to the second anniversary of his start date. Neither the Make Whole Cash Payment nor the Make Whole RSUs received by Mr. Samad will be repeated in 2023, because they are not part of his ongoing compensation. In addition, in future years, Mr. Samad’s annual incentive compensation will be determined on base salary paid to him.

Mr. Plewman. Mr. Plewman became Senior Vice President, Diagnostic Services in April 2022. In connection with his promotion to that role, the Committee adjusted his base salary and target annual incentive and granted him an additional equity award intended to provide him an incentive in his new role.

Mr. Guinan. Mr. Guinan retired in July 2022 after transitioning his responsibilities to Mr. Samad. The 2022 compensation for Mr. Guinan reflected this planned transition. For example, the annual equity award to Mr. Guinan for 2022 was reduced to reflect, and vested at the time of, his retirement. In addition, his annual incentive payout was prorated for his partial-year service and he received retirement treatment for his vested 2017 option award.

Ms. Eglinton Manner. In addition to her regular annual equity award in February 2022, Ms. Eglinton Manner also received a retention equity award having a grant date value of $2.0 million. The retention award consisted of 50% RSUs and 50% performance shares, each cliff-vesting three years after the grant date. Ms. Eglinton Manner forfeited her annual equity award, and her retention equity award, when she terminated employment in June 2022.

Executive Compensation Philosophy

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The principal components of compensation for our named executive officers are discussed in the following table.

Our program is designed to align executive compensation with the Company’s performance. The Committee has built a strong foundation for our executive compensation program and has taken numerous steps over time to structure the program to align pay with performance. We focus on aligning the annual results of our executive compensation program with the compensation of our other employees eligible for annual incentive compensation. Our long-term awards provide a strong link with stockholder interests and help attract and retain critical employee talent. We believe that a balanced compensation program that encourages a long-term focus supports sustained long-term corporate performance.

As shown in the chart below, the bulk of our senior executives’ compensation is performance based and variable in nature (91% for our CEO and an average of 79% for our other named executive officers in 2022). The chart reflects the target direct compensation for our named executive officers who are current employees (i.e., it excludes Mr. Rusckowski, Mr. Guinan and Ms. Eglinton Manner) in effect at the end of 2022 and excludes the value of other benefits and perquisites.

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The chart on the right shows the mix of our 2022 long-term incentive equity awards for executive officers, consisting of performance shares, stock options, and RSUs.  The Committee annually grants equity awards to a significant number of eligible employees under the Employee Plan.  These awards may include performance shares, stock options or RSUs, and are designed to foster an alignment of stockholder interests with a broader group of employees, to incentivize these employees to continue to perform at a high level and to promote a culture of employee ownership.  In 2022, to increase the reach of the Company’s equity awards program and its benefits, and to enhance the competitiveness of the Company’s compensation program, the Committee expanded the pool of employees receiving equity awards to include director-level employees.  Additionally, a significant number of employees at all levels of the Company own our common stock through our Employee Stock Purchase Plan, under which employees may purchase our common stock at a discount, and our Quest Diagnostics Profit Sharing Plan (the “401(k) Plan”).

None of our named executive officers has an employment agreement. Mr. Rusckowski had an employment agreement with the Company that terminated on December 31, 2022.

Best Practices

Our program reflects many best practices.

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Independent Compensation Consultant

The Committee has retained Pearl Meyer & Partners, LLC (“Pearl Meyer”) as its independent compensation consultant to assist it in carrying out its responsibilities. The following table provides information regarding Pearl Meyer.

Say on Pay, Stockholder Outreach, and Feedback

At the Company’s 2022 annual meeting of stockholders, approximately 89% of votes cast on the say-on-pay proposal voted in favor of the compensation of our named executive officers. We continued to monitor market practices and trends and to engage with our investors. As part of our program of ongoing dialogue with our investors (see “Stockholder Access and Outreach” beginning on page 9, during the past year we held discussions regarding our executive compensation program. Investors generally shared positive feedback regarding the Company’s structuring of, and overall approach to, executive pay. The Committee also received advice from Pearl Meyer and considered management recommendations based on the Company’s strategic direction. Insights gained from these efforts, including the investor feedback, were taken into account by the Committee in taking action regarding the Company’s compensation programs.

Setting Executive Compensation

The Committee establishes the Company’s executive compensation philosophy, oversees our executive compensation program and regularly monitors our executive compensation to ensure adherence to our philosophy. The Committee is supported in its work by our Senior Vice President, Chief Human Resources Officer and her staff and Pearl Meyer.

Within the framework of the executive compensation programs approved by the Committee, the Chief Executive Officer recommends to the Committee individual compensation for the executive officers, other than himself. These recommendations are based on market data and an assessment of both Company and individual performance. The Chief Executive Officer also recommends incentive compensation performance measures to align compensation with our corporate objectives. At the Committee’s request, he is present during the portions of Committee meetings in which compensation regarding the named executive officers other than the Chief Executive Officer is reviewed and decided, but the Committee retains the final authority for all such decisions. The Chief Executive Officer does not make any recommendations to the Committee regarding his own compensation and does not participate in portions of Committee meetings when his compensation is reviewed and decided.

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For each named executive officer, the Committee annually reviews performance and approves all elements of compensation, including base salary, annual incentive awards and long-term incentive awards, except for our broad-based employee benefit programs. After the Committee approves the compensation of our named executive officers, the Committee reports its compensation determinations to the full Board.

To assist the Committee with its review, our Human Resources department, in consultation with Pearl Meyer, annually prepares analyses of each named executive officer’s compensation, including tally sheets. The review includes current and prior-year compensation information regarding base salary, target and paid annual incentive compensation, deferred compensation activity and balances, aggregate equity grant values, perquisites, and any other compensation, as well as estimates of the amounts payable to each named executive officer upon termination of employment under various circumstances, including in connection with a change in control.

Peer Group

The compensation targets for, and compensation earned by, each named executive officer are analyzed relative to market data for comparable positions in a peer group. In 2022, the Committee reviewed the Company’s peer group and, after considering input from Pearl Meyer, determined to make no changes. The peer group currently consists of the following 13 companies, which generally are in the healthcare services, equipment and distribution industries.

For the named executive officers, the Committee establishes target compensation consistent, to the extent possible, with comparable positions in the peer group. Our practice is to target total direct compensation (including base salary, annual cash incentive targets and long-term incentive awards) at market competitive levels, depending upon the named executive officer’s responsibilities, expertise and experience, along with consideration given to both individual and Company performance.

Specific consideration is given to the weighting of fixed and at-risk components of pay relative to the peer group. No single element of compensation is set without considering the total direct compensation of the named executive officers relative to the marketplace, as well as the impact of any change on the other components of our pay model. When setting each participant’s annual compensation package, the grant date values of prior equity awards are considered, but realized or unrealized gains from prior equity awards are not taken into account.

For 2022, the target total direct compensation for Mr. Davis, who became Chief Executive Officer on November 1, 2022 after having served as CEO-Elect since February 3, 2022, was below the peer group median for chief executive officers. The target total direct compensation, on average, for the other named executive officers, was within the competitive range of the peer group median, except that in the case of Ms. Doherty and Mr. Prevoznik, their target total direct compensation was below the competitive range as a result of the management transition and their respective benchmarks.

Pay Components

We pay base salary to our executives to provide them a steady source of income for their services to the Company. The Committee annually reviews and approves base salaries for the named executive officers. Consistent with our executive compensation philosophy, base salaries are set at levels competitive with the peer group. Based on an assessment of each named executive officer’s position, performance, scope of responsibility, current salary level, and market comparables, the Committee determined the 2022 base salary rates, including adjustments, set forth in the following table.

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Introduction

Our annual cash incentives reward the achievement of annual performance, including operating and strategic goals (both financial and non-financial). We generally pay annual incentives to our executive officers in accordance with the SMIP. Annual cash incentive payments to our named executive officers generally are subject to the achievement of specific performance goals and, if achieved, are scheduled to be paid on or before March 15th of the year following the completion of the performance year. The Committee generally has set performance goals with targets based on the Company’s operating plan and aligned with our strategy; non-financial goals may be objective or subjective in nature.

The Committee’s approach to annual incentive compensation generally has been to:

In recent years, the primary focus of the annual incentive plan has been on revenue and profitability. Because the Committee believes that non-financial business objectives also are important, it also has incorporated non-financial metrics in the annual plan.

The following table sets forth, for each of the past five years, the aggregate annual cash incentive payments as compared to target for the named executive officers for that year. The Committee believes that these results demonstrate that annual incentive compensation has been sensitive to Company performance. For additional information, Annex B sets forth the annual cash incentive payments as compared to target for each year since 2005.

*Excludes the annual incentive payment to one former named executive officer because it was paid at a guaranteed level in connection with his joining the Company.

**Excludes one former named executive officer who forfeited his annual incentive payment upon resignation.

***Excludes Ms. Eglinton Manner, who did not receive annual incentive compensation for 2022.

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Annual Incentive Compensation Goals for 2022

For 2022, we paid annual incentive compensation under the SMIP to all the named executive officers. The Committee determined the incentive target for annual incentive compensation for each named executive officer, after considering the factors discussed above.

For each named executive officer, the threshold, target and maximum performance criteria were established with payout opportunities set at one-quarter (25%), one-time (100%), and two-times (200%) the target incentive, respectively. For non-discretionary goals, rewards for performance levels between these levels were interpolated. Performance below threshold results in zero payout for that goal.

The Committee may adjust performance measures based on objective criteria to focus on the operating performance of the Company, to avoid unintended compensation results and to ensure that participants are not inadvertently given incentives to avoid taking actions that are in the long-term interest of the Company and its stockholders.

For 2022, annual cash incentive payouts for the named executive officers were based on performance measured against both financial and non-financial goals; the Committee set the weights for each goal based on its relative importance for each executive officer. Each of the named executive officers had the same goals, except as discussed below for Mr. Plewman. The principal financial goals related to achieving budget targets, including adjusted diluted EPS and base business revenues. The financial goals were weighted heavily, as compared to non-financial goals, in order to provide a meaningful incentive for management to generate profitable growth. Due to anticipated volatility in the Company’s COVID-19 testing revenues, the Committee determined to measure base business revenues and COVID-19 testing revenues separately for purposes of annual incentive compensation.

A non-financial goal related to medical quality, customer experience, employee engagement, and a qualitative assessment of the Company’s progress developing goals based on the results of its ESG materiality assessment, was assigned a 15% weighting. The medical quality and customer experience goals, which were quantitative, were included to drive operational excellence, to improve the customer experience and to position the Company for the future. The medical quality goals included measures such as tests not performed and revised reports; the customer experience goals included service quality measures such as patient service center wait time, first call resolution and turn-around times. Quantitative employee engagement goals included engagement survey and employee retention metrics. These were included because employee engagement levels are linked to our strategy to accelerate growth and drive operational excellence, and to our effort to deliver a superior customer experience. The Company’s development of goals based on the results of its ESG materiality assessment was included to foster continued alignment of the Company’s executive compensation with its business and ESG strategies.

The Committee also considered the impact of the COVID-19 pandemic on the Company’s operations and the important role the Company has played in responding to the COVID-19 pandemic. The Committee concluded that responding to the COVID-19 pandemic was an integral part of the Company’s business plan and strategy for 2022. Consistent with the Committee’s historic approach of basing annual incentive compensation on key operating goals and in furtherance of our executive compensation philosophy, the Committee determined it was in the best interests of the Company and stockholders to continue to include a COVID-19 response goal in the annual incentive plan for 2022, but to reduce the assigned weighting to 10% (from 20% in 2021). Due to anticipated volatility in the Company’s 2022 COVID-19 testing revenues, the Committee determined that the COVID-19 response goal would be based on both financial and non-financial performance indicators, be aligned with the Company’s COVID-19 operating plan and the Company’s business strategy, and that performance would be determined following the performance period based on the Committee’s assessment. The COVID-19 response goal included an assessment of multiple factors related to the Company’s response to the COVID-19 pandemic in 2022, including: COVID-19 revenues; COVID-19 testing capacity, volumes, and turn-around time; COVID-19 testing innovation; leadership (including partnership with federal, state and local interests); and workforce management effectiveness. This approach was consistent with the Committee’s approach to the COVID-19 response goal in 2021 and 2020.

The Committee also determined that, in addition to the factors identified above, the annual incentive compensation of each executive officer was subject to a potential modification of up to 20% (positive or negative) of her or his annual incentive payout based on her or his individual performance (including the performance of the portions of the business for which the person had responsibility). The Committee determined that after the end of 2022, it would determine for each executive officer whether the person’s individual performance should result in the modification of her or his annual incentive payout, based on an individualized assessment of the person’s 2022 performance, considering factors determined appropriate by the Committee.

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The Committee further determined that, unless the Company achieved attainment of its base revenue growth target at a level exceeding 90% of target payout, payout on the medical quality/customer experience/employee engagement/ESG strategy goal would be capped at 125%. The Company achieved payout of the base business revenue goal exceeding 90%.

 Mr. Plewman had the same goals as the other named executive officers (discussed above) for the period after his promotion to Senior Vice President, Diagnostic Services. Based on the date of his promotion, these goals were applied to 67% of 2022. For the period in 2022 prior to his promotion to the executive officer position, Mr. Plewman had goals based on the 2022 performance of the Company’s regional business for which he was the general manager; these goals were applied to 33% of 2022.

 Annual Incentive Compensation Determinations for 2022

After the conclusion of 2022, and following deliberation on each of the items below, the Committee determined annual incentive compensation for 2022.

The following table shows the financial goals, the relative weight allocated to each, results and resulting payout factors for 2022.

In determining the annual incentive payment to Mr. Plewman, the Committee considered the goals described above regarding the performance of the regional business for which he was responsible prior to his promotion, and prorated the payment in the manner described above. The regional business for which Mr. Plewman had management responsibility prior to his promotion achieved a weighted payout factor of 154.3.

The Committee made the following determinations regarding other goals.

After assessing the performance of the named executive officers, the Committee determined that no modification of an annual incentive payout for 2022 based on individual performance was appropriate for any named executive officer except for Ms. Doherty, Mr. Prevoznik and Mr. Rusckowski. Based on its assessment, the Committee determined to apply a positive modifier of 5% to each of Ms. Doherty’s and Mr. Prevoznik’s incentive payouts, and a positive modifier of 20% to Mr. Rusckowski’s incentive payout. In assessing the individual performance of Ms. Doherty, the Committee evaluated a number of factors, including the performance of the areas of the Company’s business for which Ms. Doherty assumed responsibility for during 2022, the performance of the areas of the Company’s business for which Ms. Doherty relinquished responsibility during 2022, and her performance in connection with the extensive management transition during 2022. In assessing the individual performance of Mr. Prevoznik, the Committee evaluated a number of factors, including the performance of the areas of the Company for which Mr. Prevoznik assumed responsibility during 2022 and his strong performance in connection with the extensive management transition during 2022. In assessing the individual performance of Mr. Rusckowski, the Committee evaluated a number of factors, including the overall performance of the Company during 2022, as well as his strong performance in connection with the extensive management transition during the year.

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The following table shows in one location the weighted payout factors for the goals and the total resulting payout factor for 2022 for all the named executive officers except Ms. Doherty, Mr. Prevoznik, Mr. Plewman and Mr. Rusckowski.

The total payout factor for Ms. Doherty and Mr. Prevoznik was 130.3 (reflecting the 5% modifier awarded based on the results of the Committee’s assessment of their individual performance). The total payout factor for Mr. Plewman was 132.6 (reflecting the pro ration of his goals and the strong performance of the regional business for which Mr. Plewman had responsibility early in 2022). The total payout factor for Mr. Rusckowski was 148.9 (reflecting the 20% modifier awarded based on the results of the Committee’s assessment of his individual performance).

From time to time, the Committee makes adjustments to the Company’s financial results based on objective criteria for purposes of calculating performance under the SMIP. Set forth in the following table are items, identified by the Committee, for which it may make adjustments. As a matter of policy, the Committee seeks to apply these principles consistently from year to year.

The Committee may make adjustments based on these items because:

In accordance with this policy, the Committee made the adjustments set forth in the table below to the Company’s diluted EPS for fiscal year 2022 for purposes of calculating performance under the SMIP.

Items Adjusted for in 2022 Annual Incentive Calculations

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The adjustments made by the Committee are the same as those disclosed when reporting our 2022 financial performance.

For 2022, the target incentives and payouts for the named executive officers are summarized in the following table. Under the SMIP, annual incentive compensation payments generally are calculated based on salary actually paid and accordingly reflect changes in salary rate during the year.

Had the Committee not made the adjustments discussed, the payouts would have been:

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2022 Conclusion

Overall, the Committee believes that the annual incentive payments made to our named executive officers for 2022 were consistent with the objectives of our executive compensation program.

Introduction

We design our long-term incentive awards to:

To achieve these objectives, we award long-term incentives to our named executive officers annually in the form of equity awards. The following table shows the awards that we issued in 2022; in prior years, characteristics of the award (e.g., relative component mix, vesting) may have been different:

The time horizons shown operate in conjunction with, and in addition to, our stock ownership and retention requirements.

In determining the value of the long-term incentive component of each named executive officer’s compensation, the Committee considers, among other factors:

The Committee is responsible in its use of equity as long-term incentive compensation and regularly monitors the use of equity compensation for executives and the Company as a whole from a competitive standpoint. The Committee believes that our equity awards, which emphasized performance shares for our named executive officers, reflect a focus on pay for performance and competitive considerations in support of our business strategy. The program also fosters the ownership culture that the Committee seeks to encourage among our employees.

Timing of Equity Awards; Awards Committee

It has been the Committee’s practice to make annual equity grants after we announce our prior year’s earnings. It also has been the Committee’s practice to make equity grants to new hires and promoted employees, and other grants in special cases, from time to time as appropriate.

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The Awards Committee, created by the Board, consists of one director and has authority to grant certain equity awards under the Employee Plan and to make corrections to awards approved by the Compensation and Leadership Development Committee, to the extent the Awards Committee determines that corrections are necessary or appropriate to carry out the Compensation and Leadership Development Committee’s intentions. At this time, the Awards Committee consists of James E. Davis.

The Awards Committee is authorized to grant the full range of awards that can be issued under the Employee Plan. There are, however, significant limits on awards that the Awards Committee may grant. These include: (i) a prohibition on awards to executive officers; (ii) a prohibition on awards to any individual whose base salary exceeds a threshold amount; (iii) an annual limit on awards granted to any individual; and (iv) an annual limit on aggregate awards granted. It is expected that the Awards Committee will approve awards from time to time as it determines appropriate, and that the awards will be issued for, among other purposes, new hires, promoted employees, employee retention and special recognition awards, including for high-performing employees who generally are not eligible for annual equity awards. The Awards Committee regularly reports to the Compensation and Leadership Development Committee awards granted by, and corrections made by, the Awards Committee. In 2022, 3,589 stock options, 1,130 performance shares, and 24,871 RSUs were granted by the Awards Committee.

Approach to Performance Share Awards

For each year since 2005, the Committee has included an annual grant of performance shares in the long-term incentive awards to certain of our employees, including our executive officers. Performance shares encourage a long-term view and reinforce the link between financial results and rewards. Our performance shares have been generally based on a single three-year performance period and reward financial and operational performance during that period. The value that they provide depends on the level of achievement of predefined performance goals over the multi-year performance period. If minimum performance levels are not achieved, the performance shares are forfeited and provide no value. New performance share awards are made each year, and accordingly, participating named executive officers will participate in up to three overlapping performance periods during each year.

For each performance share award, the Committee establishes base-year performance levels, target performance levels and the measurement period. When the Committee is determining the payout under the performance measure, it may adjust items in the Company’s operating results and base-year performance levels using objective criteria (generally under the same categories identified above in the discussion of annual incentive compensation, and for the same reasons). No performance shares will be earned if a specified minimum performance level is not achieved. For performance above the threshold level, payment will vary with actual performance achieved, up to a maximum payment of 2 times the target level. Determination of the shares payable pursuant to each award is made after the end of the performance period.

The Committee’s approach to performance shares has been to establish targets that are challenging, yet attainable, and to provide that a maximum payout of 200% of target requires extraordinary performance. The Committee adopted the use of average return on invested capital (“ROIC”) and revenue compound annual growth rate (“CAGR”) as performance share metrics in 2012 and has continued to use these metrics, with relative TSR added as a metric in 2020. ROIC is defined for purposes of performance shares as (i) net operating profit after tax (“NOPAT”) divided by (ii) the sum of average total debt and stockholders’ equity (Invested Capital). In addition to being well supported by our stockholders, the use of ROIC holds management accountable for efficient use of capital and further links executive compensation to value creation.

Since 2012, when we began issuing performance shares with performance metrics based on the Company’s average ROIC and revenue CAGR, it has been the Company’s practice to disclose the performance targets for these measures at the conclusion of the performance period, but not at the inception of the performance period. We believe that disclosure of average ROIC and revenue CAGR performance targets at the inception of a single three-year performance cycle could work to our competitive disadvantage. Our targets are linked to our budget and to forecasts and projections that we, like other companies with which we compete, do not routinely disclose publicly or disclose only in general terms. If we were to disclose these targets, our competitors would gain an informational advantage that could enable competitors to anticipate our strategies and take steps to counter them. In this regard, we note that these performance metrics — average ROIC and revenue CAGR — are absolute, not relative to performance of other companies, and different from other measures that may not be as competitively sensitive. Thus, the Company currently believes that it is in the best interest of its stockholders to continue its practice of disclosing the performance targets relating to average ROIC and revenue CAGR at the conclusion of the performance period, but not at the inception of the performance period. The Company believes that its performance metric based on cumulative COVID-19 revenues has characteristics similar to the performance metrics based on average ROIC and revenue CAGR and thus, it will disclose the performance target for this metric only at the conclusion of the performance period. We believe that these concerns do not apply at this time to our relative TSR

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performance metric. Accordingly, we disclose in our annual proxy statement, in the year of grant, the relative TSR performance metric for our performance share awards.

The following table sets forth the aggregate performance share payouts over the past five years, as compared to target, for the named executive officers then in office. For additional information, Annex B sets forth the payments as compared to target for performance shares for each year since 2005.

The Committee believes that these results demonstrate that performance share payouts have been sensitive to Company performance.

Determination of February 2019 Performance Shares

In February 2022, the Committee determined payment for performance shares awarded in February 2019. At the time of grant, the Committee established base year performance levels, performance measures, target performance levels and the measurement period. The performance measures were the Company’s revenue CAGR (50% weight) and the Company’s average ROIC (50% weight) during the performance period (calculated in accordance with the plan, subject to adjustment as discussed above). The measurement period was January 1, 2019 to December 31, 2021.

The following table shows the targeted performance levels (awards for performance between these percentiles are interpolated on a straight-line basis).

The following table shows the actual performance levels for each of the performance measures during the measurement period, as determined by the Committee. As a result of these performance levels, the number of performance shares earned during the performance period was 200% of target.

The following table shows the 2019 performance shares actually earned by each of the named executive officers.

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The table below shows the Company’s adjusted ROIC results for each of the three years during the performance period.

In accordance with the Company’s policy, in determining the Company’s ROIC for purposes of performance shares, NOPAT (i.e., net income attributable to the Company excluding interest expense) for each year in the performance period was adjusted to reflect the same adjustments used to calculate diluted EPS for purposes of the SMIP for the relevant year. Additionally, adjustments were made to remove the effects of significant transactions not contemplated or completed at the time performance measures were set, as follows: Invested Capital was adjusted to eliminate the impact of the 2019 refinancing of the Company’s Senior Notes due January 2020 and Senior Notes due March 2020. The Committee made these adjustments based on the same pre-determined objective criteria, and for the same reasons, as described above in connection with the SMIP.

The adjustments made by the Committee had the effect of increasing ROIC for the performance period. The following table shows the performance levels for each of the performance measures during the period had the adjustments described above not been made.

As a result of these performance levels, the number of performance shares earned during the performance period would have been 200% of target, and the shares earned by each executive officer would have been the same as those actually earned.

2022 Equity Awards

In February 2022, the Committee awarded long-term compensation for 2022 to our Chief Executive Officer and the other named executive officers, resulting in the equity awards shown for them in the “2022 Summary Compensation Table” and the “2022 Grants of Plan-Based Awards Table” beginning on pages 45 and 47, respectively. The Committee revised the mix of equity awards for our executive officers other than our Chief Executive Officer, to emphasize further awards subject to performance conditions. The Committee determined that awards to our other executive officers, and to the remainder of our most senior employees, would consist of 50% performance shares, 25% options and 25% RSUs, mirroring the mix of awards to our Chief Executive Officer.

We continued to use stock options as a component of our equity awards because they align incentives with stockholder interests by rewarding appreciation in stock price. We believe that stock options are an appropriate incentive to motivate our employees. We also continued to use RSUs as a component of our equity awards because they provide retention incentives under diverse scenarios. RSUs also foster an ownership culture, help motivate employees to perform across business cycles and are aligned with stockholder value creation.

The Committee also approved awards: (i) to our other more senior equity award recipients, consisting of the same mix of awards as those received by our named executive officers; and (ii) to less senior participants in the program, consisting solely of stock options or RSUs. In addition, to increase the reach of the Company’s equity awards program and its benefits, and to enhance the competitiveness of the Company’s compensation program, the Committee expanded the pool of employees receiving equity awards to include director-level employees.

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Due to the uncertain impact of the COVID-19 pandemic on the operating environment, the Committee continued to measure base business revenues and COVID-19 testing revenues separately for purposes of performance shares. The performance measures for the 2022 performance share awards, and the relative weighting of the metrics, are the same as used for the performance shares granted in 2021: the CAGR of the Company’s base business revenue (35% weight), average ROIC (30% weight), relative TSR (measured relative to the companies included in the S&P 500 Healthcare Index) (20% weight), and cumulative COVID-19 revenue (15% weight). These metrics support key tenets of our business strategy. The target performance shares subject to the 2022 performance share awards will be earned over a single three-year period ending December 31, 2024, and will be paid out in shares of the Company’s common stock after the end of the performance period to the extent that the performance level is achieved. Determination of the shares payable pursuant to the 2022 performance share awards will be made after the end of the performance period. The relative TSR performance metric for our 2022 performance shares is set forth in the following table.

*The Earnings Multiple for Relative TSR between the percentiles designated in the above table will be interpolated.

Equity Awards for 2022 to Individual Named Executive Officers

As noted in the Executive Summary (see “2022 Compensation Actions,” beginning on page 28), 2022 was a year of significant change and transition in the management of our Company, and the Committee took numerous actions during 2022 to foster the success of that transition. In February 2022, the Committee approved equity awards for our named executive officers. The awards were consistent with the discussion above under the heading “2022 Equity Awards,” and reflected consideration of the factors noted above. Noteworthy aspects of awards to individual named executive officers are set forth below.

In connection with the significant change and transition in the management of our Company during 2022, the Committee also approved the following additional awards to named executive officers in 2022. Except as noted below, these awards have generally the same terms and conditions as the annual awards issued to the named executive officers in February 2022.

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February 2020 Performance Share Payment Determination. In February 2023, the Committee determined payment for performance shares awarded in February 2020. The performance period for those awards ended on December 31, 2022. The performance measures were the Company’s revenue CAGR (50% weight), the Company’s average ROIC (30% weight), and relative TSR (20% weight) (in each case the results associated with each metric were calculated in accordance with the plan, subject to adjustment based on objective criteria as discussed above). The Committee determined that the earnings multiple applicable to these awards during the performance period was 196% of target. Determination of these awards will be discussed in the Compensation Discussion and Analysis included in our 2024 proxy statement.

Changes to Compensation in 2023. In February 2023, the Committee adopted performance measures for the 2023 performance shares. The performance measures for the 2023 performance shares, and the relative weighting of the metrics, are: the CAGR of the Company’s revenues, including COVID-19 revenues (50% weight), average ROIC (30% weight), and relative TSR (measured relative to the companies included in the S&P 500 Healthcare Index) (20% weight). In calculating the revenue CAGR, the Company will exclude COVID-19 revenues from the baseline year (2022) revenues.

Benefits

All eligible employees, including the named executive officers, are entitled to participate in the tax-qualified 401(k) Plan. All employees whose base salary exceeds a required threshold level, including the named executive officers, are entitled to participate in the non-qualified Supplemental Deferred Compensation Plan (“SDCP”). In the 401(k) Plan, participants may defer a portion of their eligible cash compensation up to limits established by law. The purposes of the 401(k) Plan and the SDCP are to provide eligible employees an opportunity to save for their retirement and, through Company matching contributions and credits, to provide supplemental retirement income to help us compete in the market for talented employees. For additional information regarding the SDCP, see “2022 Nonqualified Deferred Compensation Table” on page 53.

As part of his or her total compensation package, each named executive officer is eligible to participate in our broad-based employee benefit plans, such as medical, dental, group life insurance and disability plans and the Employee Stock Purchase Plan. Each of these benefits is provided on the same basis as available to other exempt employees. Our benefits are designed to attract and retain talented employees and to provide them with competitive benefits.

Perquisites

Perquisites represent a minor component of executive compensation. We provide perquisites that we believe are reasonable and competitive. In 2022, Mr. Davis and Mr. Rusckowski and their families used Company aircraft for personal travel. Pursuant to aircraft timesharing agreements approved by the Committee, each of Mr. Davis and Mr. Rusckowski must reimburse the Company for its aggregate incremental cost arising out of personal use of Company aircraft after the aggregate incremental cost to the Company of personal use exceeds a threshold amount in a year. During 2022, the Company reimbursed Mr. Davis and Mr. Rusckowski for driver and vehicle costs. Named executive officers also are eligible for executive health physical exams and financial planning services. Named executive officers required to relocate upon hire or due to a change in work location are eligible for relocation benefits. Perquisites provided are disclosed in the “2022 Summary Compensation Table” beginning on page 45.

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Severance

The Company’s Executive Officer Severance Plan (“Severance Plan”) covers the named executive officers. No named executive officer will receive any severance benefits solely as a result of a change in control. For additional information, see “2022 Potential Payments upon Termination or Change in Control” beginning on page 54. We believe that the severance benefits provided to our named executive officers are consistent with market practice and are appropriate recruiting and retention tools. The named executive officers have agreed to non-competition and non-solicitation covenants for a period following termination of employment.

Risk Assessment

In August 2022, the Committee reviewed the compensation arrangements for the Company’s employees, including the Company’s executive officers, to assess whether the arrangements, individually or in combination, encourage risk taking that is reasonably likely to have a material adverse effect on the Company. In assessing the risk, the Committee considered plan designs, plan operation, plan controls, oversight and review, and competitive norms. In assessing the risk of plans that apply to our executive officers, the Committee also considered the risk guidelines suggested by the Center on Executive Compensation. The Committee concluded that the compensation arrangements for the Company’s employees, including the arrangements for the Company’s executive officers, do not encourage risk taking that is reasonably likely to have a material adverse effect on the Company. Factors supporting this conclusion include the following: (i) by utilizing a variety of performance metrics in our incentive programs, we discourage excessive risk taking by removing the incentive to focus on a single performance goal to the detriment of the Company’s overall performance; (ii) under both the SMIP and our performance shares, payouts are capped at a maximum level, thereby reducing the risk that executives might be motivated to take excessive risk in order to attain excessively high performance in order to maximize payouts; (iii) we maintain a balance between short-term and long-term incentives; (iv) we maintain stock ownership and retention guidelines that are designed to incentivize our management team to focus on the Company’s long-term sustainable growth; (v) we maintain a clawback policy, discussed in “Clawback Policy” on page 50, designed to prevent misconduct relative to financial reporting; and (vi) the Committee discusses risk in connection with compensation for which it is responsible.

Share Ownership and Retention Guidelines

Since 2005 we have maintained common stock ownership and retention guidelines. Executives have five years from the time that they become executive officers to meet the ownership requirements. Our current guidelines are set forth in the following table.

We determine the number of shares corresponding to these thresholds on April 1 of each year using the average annual price of our common stock during the preceding calendar year and the employee’s base salary as of the first business day in April. For purposes of determining whether an employee has met the minimum shareholding requirements, we count shares subject to unvested RSUs, but not shares subject to stock options or unvested performance shares.

Under the guidelines, an employee’s ability to sell shares associated with equity awards is limited until the officer satisfies a minimum ownership position. Our executive officers are required to retain 75% of net shares received from vesting of RSUs and performance shares and from the exercise of stock options, until they achieve their minimum shareholding requirement. As of April 1, 2023, each of our currently employed named executive officers is compliant with the guidelines.

The Committee periodically reviews these guidelines and may adjust them. Under our policy, if a named executive officer satisfies the minimum share ownership requirements in our guidelines, the Committee monitors future equity awards to that person to assure that the interests of the named executive officer and stockholders continue to be significantly aligned and, if warranted, adjusts the minimum share ownership requirements or adds retention requirements.

Policies Regarding Hedging or Pledging our Common Stock

Our directors and executive officers are prohibited from hedging the economic risk of owning our Common Stock. For

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information regarding our policies relating to directors, executive officers and other employees hedging or pledging the Company’s common stock, see “Policies Regarding Hedging and Pledging our Common Stock; Window Periods” on page 19.

Compensation and Leadership Development Committee Report

The Compensation and Leadership Development Committee has reviewed and discussed with management the Compensation Discussion and Analysis. Based on its review and discussions with management, the Compensation and Leadership Development Committee recommended to the Board that the Compensation Discussion and Analysis be included in this proxy statement and incorporated by reference into the Company’s Annual Report on Form 10-K for 2022.

Compensation and Leadership Development Committee

Vicky B. Gregg, Chair

Denise M. Morrison
Timothy M. Ring

This table summarizes the compensation for 2022 for each of our named executive officers.