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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 ☒   
Filed by a Party other than the Registrant ☐
Check the appropriate box:

Preliminary Proxy Statement

Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))

Definitive Proxy Statement

Definitive Additional Materials

Soliciting Material under §240.14a-12
Envestnet, Inc.
(Name of Registrant as Specified In Its Charter)
   
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):

No fee required.

Fee paid previously with preliminary materials.

Fee computed on table in exhibit required by Item 25(b) per Exchange Act Rules 14a6(i)(1) and 0-11

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April 5, 2024
Berwyn, Pennsylvania
DEAR FELLOW SHAREHOLDER:
It is with great pleasure that we invite you to our 2024 Annual Shareholders Meeting to discuss the progress of the company during the past year and to review our plans for the future. The meeting will be held virtually on May 8, 2024 at 9:00 a.m. Eastern Time.
Over the last few years, we have worked effectively to make Envestnet even stronger—by bringing the company together to enable a highly connected, highly technology-driven, highly data-driven platform to serve the wealth management industry. Today, Envestnet is in a leadership position because of the work that we have done.
We have created scale and competitive advantage with connected technology, data and solutions in our industry leading wealth management platform and ecosystem to serve all client workflows and business models. We executed successfully as demonstrated with our asset and account growth, revenue growth, margin expansion, and improved client service scores. We are the industry leader by assets, advisors, accounts, market share across financial planning, our turnkey asset management offering and the data insights we generate. We are embedded with a great roster of clients and partners—driving an industry ecosystem that powers growth, and we have an exceptionally talented and aligned leadership team to deliver the next phase of Envestnet.
Fiscal Year 2023 Achievements:

Revenue Consistency: Maintained at $1.2 billion, in line with the previous year.

EBITDA Growth: Adjusted EBITDA rose 16%, highlighting our operational efficiency.

Earnings Per Share: Adjusted Net Income per Diluted Share increased by 14%, reflecting our financial health.
Our dedication to the industry-leading wealth management platform continues, driving growth and enhancing productivity for our clients. Over the last two years, Envestnet delivered $116 billion of AUM/A net inflows, representing an average organic asset growth rate of 8%. This stands as a testament to our platform’s enduring appeal and the effectiveness of our platform enhancements.
Key Growth Milestones in 2023:

Advisor Growth: Nearly 3% increase in the total number of advisors using the Envestnet platform to more than 108,000.

Account Growth: Over 4% growth to more than 19.1 million accounts, indicating higher platform adoption.

Asset Growth: Total platform assets grew 14% to $5.8 trillion, AUM/A assets grew 20% to $846.8 billion, and AUM assets grew 22%. Net flows into AUM/A totaled $58.5 billion, an organic asset growth rate of 8%, and net flows into AUM totaled $30.1 billion, an organic asset growth rate of 9%.

Platform Scalability: A 50% increase in accounts per advisor since the start of 2020 through the end of 2023.
2024 marks the silver anniversary of Envestnet’s founding. Throughout that period, we have consistently anticipated and driven change in the wealth management industry. Today, Envestnet remains strongly positioned as an industry leader with enduring competitive advantage as evidenced by our unmatched capabilities and deep client relationships with our top 25 clients averaging a 15-year partnership with us.
Trends and Industry Leadership:
Scale and Convergence: Scale is a defining theme across the financial services landscape, including wealth management.
 

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Personalization: Our modern UMA platform and robust year-over-year growth across several of our Solutions business lines where personalization and technology drive differentiation; including High-Net-Worth, Direct Indexing, Tax Overlay and Managed Accounts to RIA’s.
Technology Integration: Enhancements to our platform support streamlined operations from planning through execution; thus reinforcing our role at the convergence point for integrated wealth-plus-custody solutions.
Evolving Practice Management: MoneyGuide secured the top spot in financial planning software for the 17th consecutive year in the 2024 T3 Advisor Software Survey, our analytics solution leverages more than 19,000 data sources to produce 20+ million insights daily across 100+ insight types.
Our wealth management platform, leveraged by the industry’s leading banks and brokerage firms, continues to set the standard for comprehensive financial advisory services. This deep connectivity enables us to deliver solutions that enhance advisors’ day-to-day operations and long-term success.
Leadership Transition: 2024 will mark a period of transition with Chief Executive Officer and Co-Founder, William Crager, stepping into a Senior Advisor role. His visionary leadership has been instrumental in our success, and we are confident in the leadership team’s ability to continue driving our strategic vision forward.
Looking Ahead: Our ecosystem of connected technology, advanced insights, and comprehensive solutions positions us to remain at the forefront of financial advice. As we continue to empower advisors and financial service providers with innovative technology and intelligence, we are grateful for your ongoing support and confident in our future direction.
As shareholders, you will be able to attend the 2024 Annual Meeting, vote and submit your questions during the meeting by visiting https://web.lumiagm.com/241143720. The password for the meeting is envestnet2024 (case sensitive).
Our formal agenda for this year’s meeting includes votes to elect two directors to our Board; to approve, on an advisory basis, 2023 executive compensation; to ratify the selection of our independent registered public accounting firm for 2024; to approve the Envestnet, Inc. 2024 Long-Term Incentive Plan; and to approve an amendment to Envestnet’s certificate of incorporation to allow for exculpation of certain officers as permitted pursuant to recent amendments to Delaware law.
Shareholders of record can vote their shares via the Internet, by using a toll-free telephone number or by completing a proxy card and mailing it in the return envelope provided. If you hold shares through your broker or other intermediary, that person or institution will provide you with instructions on how to vote your shares.
We thank you for your investment and your confidence in our business, and look forward to continuing our ongoing dialogue. We thank you in advance for your participation and look forward to seeing you at the 2024 Annual Meeting.
Sincerely,
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James L. Fox
Chair and Interim Chief Executive Officer
 

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April 5, 2024
Berwyn, Pennsylvania
TO THE SHAREHOLDERS OF ENVESTNET, INC.:
The 2024 Annual Meeting of Shareholders of Envestnet, Inc. will be held virtually on May 8, 2024, at 9:00 a.m. Eastern Time. Only shareholders of record at the close of business on March 12, 2024, are entitled to notice of, and to vote at, the 2024 Annual Meeting. You will be able to attend the 2024 Annual Meeting, vote and submit your questions during the meeting by visiting https://web.lumiagm.com/241143720. The password for the meeting is envestnet2024 (case sensitive).
The 2024 Annual Meeting will be held for the following purposes:
1.
To elect two (2) directors to hold office until the 2025 annual meeting and until their successor is duly elected and qualified or until their earlier resignation, removal, incapacity or death;
2.
To approve, on an advisory basis, 2023 executive compensation;
3.
To ratify the appointment of KPMG LLP as Envestnet’s independent registered public accounting firm for the fiscal year ending December 31, 2024;
4.
To approve the Envestnet, Inc. 2024 Long-Term Incentive Plan;
5.
To approve an amendment to Envestnet’s Fifth Amended and Restated Certificate of Incorporation to allow for exculpation of certain officers as permitted pursuant to recent amendments to Delaware law; and
6.
To transact such other business, if any, as lawfully may be brought before the meeting.
Your Board of Directors unanimously recommends that you vote “FOR” each nominee listed on the enclosed proxy card or voting instruction form and “FOR” all other Company proposals.
Whether or not you plan to attend the 2024 Annual Meeting and regardless of the number of shares you own, please vote as promptly as possible via the Internet or by telephone in accordance with the instructions in your proxy materials. For further information concerning the individuals nominated by the Board as directors, the proposals being voted upon, use of the proxy and other related matters, you are urged to read the attached proxy statement in its entirety.
IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS FOR THE SHAREHOLDER MEETING TO BE HELD ON MAY 8, 2024: THIS PROXY STATEMENT, FORM OF PROXY CARD AND OUR 2023 ANNUAL REPORT ARE AVAILABLE AT WWW.ENVESTNET.COM. WE ARE SENDING THIS PROXY STATEMENT AND MAKING THIS PROXY STATEMENT FIRST AVAILABLE ON OR ABOUT APRIL 5, 2024.
Your vote is very important, and I encourage you to submit your proxy for this year’s Annual Meeting as promptly as possible.
By Order of the Board of Directors,
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Shelly O’Brien
Corporate Secretary

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PROXY STATEMENT SUMMARY 1
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CORPORATE GOVERNANCE AND BOARD MATTERS 5
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ENVIRONMENTAL, SOCIAL AND GOVERNANCE 26
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EXECUTIVE COMPENSATION 32
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AUDIT MATTERS 62
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QUESTIONS AND ANSWERS ABOUT THE ANNUAL MEETING AND VOTING 76
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SECURITY OWNERSHIP 83
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OTHER MATTERS FOR THE 2024 ANNUAL MEETING 85
SHAREHOLDER PROPOSALS FOR 2025 ANNUAL MEETING 86
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APPENDIX A 87
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ENVESTNET, INC.
1000 Chesterbrook Boulevard, Suite 250
Berwyn, Pennsylvania 19312
April 5, 2024
PROXY STATEMENT 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. References to the “Company,” “Envestnet,” “we,” “us,” or “our” in this proxy statement refer to Envestnet, Inc. and its subsidiaries as a whole.
PROPOSALS AND HIGHLIGHTS
2024 Annual Meeting Proposals
Board
Recommendation
Page
Reference
Proposal 1:
Election of two (2) directors to hold office until the 2025 annual meeting and until their successor is duly elected and qualified or until their earlier resignation, removal, incapacity or death;
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Proposal 2:
Approval, on an advisory basis, of 2023 executive compensation;
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Proposal 3:
Ratification of the appointment of KPMG LLP as Envestnet’s independent registered public accounting firm for the fiscal year ending December 31, 2024;
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Proposal 4:
Approval of the Envestnet, Inc. 2024 Long-Term Incentive Plan;
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Proposal 5:
Approval of an amendment to Envestnet’s Fifth Amended and Restated Certificate of Incorporation to allow for exculpation of certain officers as permitted pursuant to recent amendments to Delaware law; and
Such other business, if any, as may lawfully be brought before the meeting.
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Director Nominees
Our Board has nominated two (2) individuals for election as directors at the Company’s 2024 Annual Meeting. Both nominees are currently serving as members of the Board. We believe each nominee has a wide-ranging set of qualifications, skills and experiences relevant to Envestnet’s strategic evolution, including deep expertise in financial services, public company leadership and corporate governance.
Additional information concerning the composition of our Board and our director nominees can be found under Proposal 1: Election of Directors.
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CORPORATE GOVERNANCE AND BOARD HIGHLIGHTS
The following are highlights of our corporate governance practices. Please see the section below entitled “Corporate Governance and Board Matters” for more information.
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All our directors are independent (other than the Interim Chief Executive Officer (“Interim CEO”))
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Board oversight of environmental, social and governance matters
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Commenced Board declassification, with classified Board to be phased out by 2026
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Stock ownership requirements for directors and named executive officers (“NEOs”)
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Ongoing Board refreshment, with two new continuing directors in 2023
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Regular executive sessions of independent directors
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Board diversity in terms of gender, race, ethnicity and tenure that provides a range of viewpoints, skills and experience
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Continuing education program for directors
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Regular Board and committee meetings
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Annual review of Chief Executive Officer (“CEO”) and Board Chair succession planning
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Annual Board and committee self-evaluations
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Code of Business Ethics and Conduct applicable to all directors, officers and employees
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Risk oversight by full Board and committees
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Trading policy that prohibits short-term speculative transactions in hedging and, with limited exceptions, pledging Envestnet securities
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Policy on public company board service (number of additional public company boards of directors limited to three)
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Clawback Policy applicable to all directors and Section 16 officers
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Majority voting and director resignation policy in uncontested director elections
ENVIRONMENTAL, SOCIAL AND GOVERNANCE HIGHLIGHTS
The following are highlights of our commitment to Environmental, Social and Governance (“ESG”) matters. Please see the section below entitled “Environmental, Social and Governance” for more information.
Envestnet is dedicated to upholding its commitment to ESG initiatives by fostering financial wellness within our communities, among our customers, partners, and employees. We aim to be a responsible citizen in our communities, mindful stewards of the resources we consume, and are committed to the growth and development of our employees. The Company has exemplified this commitment in many ways, including:
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Continued our commitment to the Envestnet Institute on Campus (“EIOC”), a program for university students, designed to bridge the gap between academic knowledge and the application of this knowledge in the Wealth and Asset Management industries.
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Required Diversity, Equity and Inclusion (“DEI”) training for all U.S. employees.
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Established a DEI Social Learning Community in our online learning management system, curating a collection of books, articles, videos, and other resources to supplement employees’ learning on DEI topics.
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Expanded our employee resource groups, adding a third official employee resource group, “Enclusion,” for Black and African American employees, in addition to “Harbor” for our female and female-identified workforce and “Bridges” for our diverse workforce.
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Utilized relationships within the Envestnet Charitable Giving Program to extend outreach to marginalized communities, offering educational initiatives on financial literacy.
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Continued to offer a comprehensive suite of employee benefits, including parental stipends for children under age 6, adoption and surrogacy benefits, tuition reimbursement, scholarships for employees’ children, college loan repayment support, and paid parental leave.
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Published the Envestnet Human Rights Policy Statement, outlining our commitment to human rights and our approach to integrating those commitments in our business operations, community engagement, environmental stewardship, and corporate governance.
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Published the Envestnet Supplier Code of Conduct, providing guidance to our suppliers and partners on Envestnet’s expectations concerning human rights, environmental practices, and business ethics.
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Advanced ongoing initiatives to decrease Envestnet’s energy usage and carbon emissions by offering remote work for a significant portion of our workforce and endorsing flexible work schedules. Since January 2022, Envestnet has reduced our office space by one-third.
EXECUTIVE COMPENSATION HIGHLIGHTS
The following are highlights of our executive compensation practices. Please see the section below entitled “Executive Compensation” for more information.
Envestnet is committed to responsible executive compensation practices that reflect recognized high corporate governance standards. A summary of our notable practices is provided below.
What We Do What We Don’t Do

Pay-for-performance by aligning a significant portion of NEO compensation with the Company’s overall success and performance

Allocate a significant proportion of each NEOs’ pay in equity-based compensation, with at least half of the equity value in Performance Share Units (“PSUs”)

Enforce meaningful stock ownership requirements for executives

Maintain and uphold a robust Clawback Policy that exceeds New York Stock Exchange (“NYSE”) requirements

Retain the services of an independent compensation consultant to ensure objectivity and fairness

Engage in continuous shareholder outreach to gather feedback and insights

Conduct an annual advisory vote on executive compensation

No single-trigger vesting of equity awards in the event of a change in control

No excise-tax “gross-ups”

No excessive perquisites

No Company contributions to nonqualified or supplemental retirement plans

No option repricing without prior shareholder approval

No hedging activities involving Company’s securities
Highlights for 2023 included the following:

Awarded equity in February 2023 with a lower value compared to the grants made in 2022. The grant date fair value of the awards in 2023, influenced by the prior year performance, was approximately 39% lower than 2022. This resulted in a reduction in the Summary Compensation Table (“SCT”) pay for NEOs.

Secured high say-on-pay support and maintained dialogue with our shareholders. Over 95% of votes were cast in support of our 2023 advisory vote on executive compensation, demonstrating high levels of sustained support for our framework and outcomes.

Reviewed target compensation levels for 2023 with reference to practices among our compensation peers. Shelly O’Brien was the only NEO receiving an increase in her target compensation following a
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review that indicated a phased market adjustment was appropriate. For 2023 her salary increased from $375,000 to $400,000 and her target annual incentive opportunity increased from 76.8% of salary to 80% of salary.

Implemented modest changes to incentive measures and weightings in 2023. In comparison to 2022, we increased the proportion of the annual cash incentive tied to financial performance from 75% to 80%, focusing on Adjusted Revenue (40%) and Adjusted EBITDA (40%). The remaining portion continued to be based on individual and team performance in 2023.

Approved relative Total Shareholder Return (“TSR”) and Adjusted EBITDA Margin measures for PSUs granted in 2023. The vesting of PSUs granted in 2023 will be determined in 2026 based on two equally-weighted performance measures of relative TSR and Adjusted EBITDA Margin, aligned with our long-term strategic priorities of margin enhancement and value creation for shareholders.

Announced transitions of key leadership roles. In September 2023, a transition was announced in relation to the role of CFO. At the request of the Board, Peter D’Arrigo agreed to step down as CFO effective November 15, 2023 and the Company agreed to pay Mr. D’Arrigo the payments he was entitled to under his employment agreement in connection with a termination without cause. Mr. D’Arrigo agreed to remain as a senior advisor through March 31, 2024 to facilitate a smooth transition and also agreed to general release terms, restrictive covenants and confidentiality obligations. Joshua Warren joined Envestnet effective October 2, 2023 as a senior advisor and was appointed to the role of CFO effective November 15, 2023. In January it was announced that Mr. Crager would step down as CEO of Envestnet and each of its subsidiaries effective March 31, 2024. Mr. Crager will not receive any severance and neither Mr. Crager nor Mr. D’Arrigo will be granted equity awards in 2024 given their planned departures.

James L. Fox, Chair of our Board, was appointed Interim CEO effective April 1, 2024. He will receive a monthly salary, a grant of Restricted Stock Units (“RSUs”) and will be eligible to receive a discretionary cash bonus in respect of his services.
In aggregate the performance achievements detailed further in the Compensation Discussion and Analysis were reflected in our variable outcomes in respect of 2023:
Annual incentives were
earned at

100% of target
PSUs that concluded their performance period on December 31, 2023
vested at 27.72% of target
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CORPORATE GOVERNANCE AND BOARD MATTERS
PROPOSAL NO. 1: ELECTION OF DIRECTORS
At the 2024 Annual Meeting, shareholders will vote on the election of the two (2) director nominees listed on the following pages. The term of the current Class I directors expires at the 2024 Annual Meeting.
Our Board currently consists of three classes of directors serving staggered three-year terms, with the term of each class expiring in successive years. In March 2024, our Board approved and adopted Amended and Restated By-laws (“by-laws”) to, among other things, eliminate our classified structure over the course of two years. Beginning at the 2024 Annual Meeting, each director will be elected for a one-year term.
Following the recommendation of the Nominating and Governance Committee, our Board has nominated Valerie Mosley and Gregory Smith for election at the 2024 Annual Meeting. Wendy Lane will not stand for reelection following the completion of her term at the 2024 Annual Meeting. As previously announced, William Crager will step down as a member of the Board following the 2024 Annual Meeting.
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THE BOARD OF DIRECTORS RECOMMENDS A VOTE “FOR” THE ELECTION OF EACH NOMINEE AS A DIRECTOR OF ENVESTNET.
If any director nominee is unable to serve, the individuals named as proxy may vote for another nominee proposed by the Board, or the Board may reduce the number of directors to be elected. Each nominee has indicated that they will serve if elected. If any director resigns, dies, or is otherwise unable to serve out his or her term, or the Board increases the number of directors, the Board may fill the vacancy until the next annual meeting of shareholders.
Set forth below is information with respect to the nominees for election as directors and the other directors whose terms of office as directors will continue after the 2024 Annual Meeting. There are no arrangements or understandings between any director and any other person pursuant to which any director was or is selected as a director or nominee.
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Nominees (Class I) for Election at the 2024 Annual Meeting
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Valerie Mosley
Age 64
Ms. Mosley has served as a member of our Board since October 2018. Ms. Mosley is the founder and Chief Visionary Officer of Upward Wealth, DBA BrightUp, www.getbrightup.com. BrightUp is a fintech platform that helps hardworking, under-resourced Americans know their worth and grow their wealth. She began her career at Chase Manhattan Bank, where she was a Commercial Lending Officer for financial institutions. She also worked in institutional corporate bond sales at Kidder Peabody and at P.G. Corbin Asset Management as its Chief Investment Officer before moving on to Wellington Management. Previously, from January 1992 until June 2012, Ms. Mosley served in multiple roles at Wellington Management Company, LLP (“Wellington Management”), a trillion-dollar global money management firm, including as Senior Vice President, Partner, Portfolio Manager and Investment Strategist. During her 20-year tenure at Wellington Management, she directly managed billions of dollars for clients. She sat on several of the firm’s investment committees, the risk committee and chaired the firm’s Industry Strategy Group, charged with taking a long-term perspective to identify headwinds and tailwinds impacting industries. Ms. Mosley currently also serves on the board of directors of Eaton Vance’s family of mutual funds, where she is chair of the governance committee and a member of the portfolio management committee; DraftKings, an online sports betting platform; McLean Hospital, a world leader in Mental Health, New Profit, a philanthropic venture firm and The Skoll Foundation Investment Committee. Ms. Mosley formerly served on the board of directors of Groupon, Inc. from April 2020 to August 2022, an online marketplace company, where she was a member of the nominating committee. Ms. Mosley also previously served on Caribou’s board, a fintech company that refinances automobile loans. Occasionally, Ms. Mosley advises and invests in companies that add value to investors and society through Valmo Ventures.
Ms. Mosley holds a B.A. in History from Duke University and a M.B.A. from the Wharton School of Business at the University of Pennsylvania, with a specialty in finance, and had been recognized in financial circles as one of the outstanding leaders of her time. Valerie has been recognized as The International Person of the Year by The UK’s Power List, One of the 50 Most Powerful Women in Business and one of the Top 75 African Americans on Wall Street by Black Enterprise Magazine. She was also in the spotlight in 2023, recognized by the Executive Leadership Council as one of the 10 Black Leaders in Finance.
Ms. Mosley’s qualifications to serve on the Board include her extensive experience in the wealth management business. Ms. Mosley brings to our Board expertise in investment management, the perspectives of public company investors, accounting and financial reporting and strategic planning.
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Gregory Smith
Age 60
Mr. Smith has served as a member of our Board since February 2015. Mr. Smith currently is an Executive in Residence and Professor of Practice at the University of Wisconsin Milwaukee’s Lubar School of Business. He was Managing Partner of Barnett Management Advisors, LLC from 2012 until 2020. Prior to joining the University of Wisconsin Milwaukee, Mr. Smith served as Senior Vice President and Chief Financial Officer of the Marshall & Ilsley Corporation and M&I Bank from 2006 until the company’s sale to BMO Harris Bank in 2011. Prior to joining Marshall & Ilsley, Mr. Smith held progressively senior roles during a 16-year Wall Street investment banking career, including six years as a Managing Director. He is currently a Director and Vice Chairman of the Church Mutual Holding Company, Inc. (f/k/a the Church Mutual Insurance Company). He also served as a Director of its subsidiary, CM Vantage Specialty Insurance Company until the formation of the holding company in 2020. He is also a board member of the Milwaukee Symphony Orchestra, and completed nine years of Board Service at the University School of Milwaukee in 2023. He served as a Trustee of the Milwaukee County Pension Fund in 2014 and 2015.
Mr. Smith is an honors graduate of both Princeton University, where he received an undergraduate degree, and The University of Chicago where he received an MBA. More recently, he has been recognized as a Board Leadership Fellow by the National Association of Corporate Directors. Mr. Smith’s qualifications to serve on our Board include his extensive experience in accounting, liquidity, budgeting and forecasting, treasury, capital management, tax matters and mergers and acquisitions, including as a Chief Financial Officer.
Mr. Smith brings to our Board expertise in finance, investment strategy and capital allocation, strategic transactions, financial reporting and accounting.
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Directors whose terms expire in 2025 (Class III)
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Lauren Taylor Wolfe
Age 45
Ms. Taylor Wolfe has served as a member of our Board since March 2023. Ms. Taylor Wolfe is the co-founder and has served as the Managing Partner of Impactive Capital LP, an active impact investing firm, since its founding in April 2018. Prior to founding Impactive Capital LP, Ms. Taylor Wolfe served as Managing Director and Investing Partner at Blue Harbour Group, L.P., an investment management firm, from 2007 to January 2018. Earlier in her career, Ms. Taylor Wolfe served as a Portfolio Manager at SIAR Capital LLC from 2003 to 2007, and as an Associate at Diamond Technology Partners from 2000 to 2003. Ms. Taylor Wolfe previously served on the board of directors of HD Supply Holdings, Inc., an industrial distributor, from March 2017 until it was acquired by The Home Depot, Inc. in December 2020. Ms. Taylor Wolfe has served on the 30% Club Steering Committee and was an Angel member of 100 Women in Finance.
Ms. Taylor Wolfe earned a B.S. in Applied Economics and Management, magna cum laude, from Cornell University and a M.B.A. from The Wharton School at the University of Pennsylvania.
Ms. Taylor Wolfe’s qualifications to serve on our Board include her experience in the investment management industry. Ms. Taylor Wolfe brings to our Board expertise in capital allocation, finance and the perspectives of public company investors.
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Barbara Turner
Age 61
Ms. Turner has served as a member of our Board since March 2023. She has more than 35 years of leadership experience in the financial services industry. Most recently, Ms. Turner was President and Chief Executive Officer of Ohio National Financial Services, Inc., the first woman and person of color to hold this role. During her 26-year tenure at Ohio National, Ms. Turner served as Vice Chair, Chief Operating Officer, Chief Administrative Officer and Chief Compliance Officer for Ohio National’s parent company and President and Chief Executive Officer of its broker-dealer and investment advisory subsidiaries. Previously, she held roles at Cox Financial Corporation, Reynolds DeWitt Securities, Provident Bank, and Central Trust Bank.
Ms. Turner is the Chief Executive Officer and founder of BT RISE, an organization committed to the economic empowerment and education of women and underserved communities, the Board Chair of the United Way of Greater Cincinnati and the Board Chair of the Urban League of Greater Southwestern Ohio. She also serves on the board of The Christ Hospital Health Network. Ms. Turner previously served as Vice Chair of the Cincinnati USA Regional Chamber of Commerce, the Vice Chair of the insurance industry trade association LL Global (LIMRA) and on the Board of Directors of the American Council of Life Insurers.
Ms. Turner attended the University of Cincinnati and is a graduate of the SIFMA/Wharton Securities Industry Institute and the FINRA Institute at Wharton Certified Regulatory and Compliance Professional programs.
Ms. Turner’s qualifications to serve on our Board include her track record of exceptional leadership as a senior executive in the financial services industry. Ms. Turner brings to our Board expertise in financial services, compliance and information security, operations and leadership.
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Directors whose terms expire in 2026 (Class II)
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Luis Aguilar
Age 70
Mr. Aguilar has served as a member of our Board since March 2016. Mr. Aguilar was a Commissioner at the SEC from July 2008 through December 2015. Prior to his appointment as an SEC Commissioner, Mr. Aguilar was a partner with the international law firm of McKenna Long & Aldridge, LLP (subsequently merged with Dentons US LLP), specializing in corporate and securities law. Mr. Aguilar’s previous experience includes serving as the General Counsel, Head of Compliance, Executive Vice President and Corporate Secretary of Invesco, Inc. with responsibility for all legal and compliance matters regarding Invesco Institutional. While at Invesco, he was also Managing Director for Latin America and president of one of Invesco’s broker-dealers. His career also includes tenure as a partner at several prominent national law firms: Alston & Bird LLP; Kilpatrick Townsend & Stockton LLP; and Powell Goldstein Frazer & Murphy LLP (subsequently merged with Bryan Cave LLP). He began his legal career as an attorney at the SEC. Mr. Aguilar represented the SEC as its liaison to both the North American Securities Administrators Association and to the Council of Securities Regulators of the Americas. He also served as the sponsor of the SEC’s first Investor Advisory Committee.
Mr. Aguilar serves as a director of Donnelley Financial Solutions, Inc. He has been a principal in Falcon Cyber Investments, a firm focused on cybersecurity since January 2016. He was a director of MiMedx Group, Inc. from March 17, 2017 through September 19, 2019.
Mr. Aguilar earned a J.D. from the University of Georgia School of Law, a Master of Laws (LLM) in Taxation from Emory University School of Law and a B.S. from Georgia Southern University. Mr. Aguilar has completed certifications from the National Association of Corporate Directors (NACD) in Directorship, Board Leadership and Cyber Risk Oversight.
Mr. Aguilar’s qualifications to serve on our Board include his experience as an SEC Commissioner and his extensive experience in corporate, securities and compliance matters, especially as they apply to investment advisors, investment companies and broker-dealers. Mr. Aguilar brings to our Board expertise in investment management, compliance, risk management, cybersecurity, corporate governance, government relations and public policy.
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Gayle Crowell
Age 73
Ms. Crowell has served as a member of our Board since March 2016. She served as a member of the Yodlee, Inc. (“Yodlee”) board of directors from July 2002 until November 19, 2015, when Yodlee was acquired by the Company, and as lead independent director of Yodlee between March 2014 and November 2015. Ms. Crowell served as an operational business consultant for Warburg Pincus LLC, a private equity firm, from June 2001 to January 2019. From January 2000 to June 2001, Ms. Crowell served as president of Epiphany, Inc., a developer of customer relationship management software which was acquired by SSA Global Technologies, Inc. in September 2005.
Ms. Crowell currently serves on the boards of directors of Pliant Therapeutics, a biotechnology company developing therapies for fibrotic diseases, Hercules Capital, a specialty finance company serving the technology and life sciences sectors, Instinct Science, a comprehensive veterinary practice management software platform with integrated digital treatment plans and trusted diagnostic and reference tools, Centerbase, a full-service, cloud-based legal practice management and growth solution serving mid-sized law firms and Fexa, a provider of a suite of facility management software tools that serve retailers, restaurateurs and hospitality service providers.
Ms. Crowell earned a B.S. in Education from the University of Nevada at Reno. Ms. Crowell also attended the Directors College Program at Stanford Law School and the Executive Program for Growing Companies at Stanford Graduate School of Business.
Ms. Crowell’s qualifications to serve on our Board include her experience as a senior executive in the technology industry. Ms. Crowell brings to our Board expertise in technology and software, cybersecurity, compliance, digital transformation, sales and marketing, Board governance, compensation and leadership.
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James L. Fox
Age 72
Mr. Fox became Interim CEO of the Company, effective April 1, 2024. Mr. Fox has served as a member of our Board since February 2015 and Chair of the Board since March 2020. Mr. Fox retired as Non-Executive Chairman of FundQuest, Inc., upon its acquisition by the Company, effective December 2011 after serving in that role since September 2010 and, prior to that, as President and Chief Executive Officer starting in October 2005. Mr. Fox has over 30 years of senior executive experience with the BISYS Group, Inc., First Data Corporation, eOne Global, and PFPC. He serves as a director of Madison CF (UK) Limited, The Ultimus Group LLC and Yukon YC Holdings LLC. He also served as a director of Brinker Capital Holdings, Inc. from July 2015 until September 2020.
Mr. Fox participated in the Advanced Management Program at the Wharton School of the University of Pennsylvania. He earned a M.B.A. in Finance from Suffolk University and a B.A. in Economics from the State University of New York at Oswego.
Mr. Fox’s qualifications to serve on our Board include his extensive experience as a Chief Executive Officer and business leader in the financial services industry and his knowledge gained from service on the boards of various other companies. Mr. Fox brings to our Board expertise in wealth management, accounting and financial reporting, public company leadership and mergers, acquisitions and other strategic transactions.
Departing Directors
William Crager
Following our 2024 Annual Meeting, William Crager will step down from our Board. Mr. Crager co-founded our Company and served as our CEO and a member of our Board since March 2020. Previously, Mr. Crager served as our Interim CEO between October 2019 and March 2020, Chief Executive of Envestnet Wealth Solutions since January 2019 and President of Envestnet since 2002.
Wendy Lane
Wendy Lane will not stand for reelection following the completion of her term at the 2024 Annual Meeting. We extend our sincere gratitude to Ms. Lane for her service as a director.
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OUR BOARD OF DIRECTORS
Overview
The Nominating and Governance Committee works with the Board on an annual basis to evaluate the Board as a whole and its individual members in light of the needs of the Board, including the extent to which the current composition of the Board reflects a wide-ranging mix of knowledge, experience, skills, viewpoints, tenures and backgrounds.
Our Board believes that a balance of director experience, skills, diversity and tenure is a strategic asset to our shareholders. Our Board further believes that our current directors and director nominees meet the criteria described in “Board Responsibilities-Recruitment, Nomination and Succession Planning” on page 16 and collectively exhibit the diversity and depth and breadth of experience necessary to contribute to an engaged board that is capable of effectively and thoughtfully overseeing Envestnet’s management. As shown in the following matrix, our directors possess a mix of knowledge, skills, experiences and attributes that our Board believes are relevant to our long-term strategy and success. The Nominating and Governance Committee does not assign specific weights to any of these skills, nor does the matrix encompass all of the knowledge, skills, experiences or attributes of our directors. Further information on each director nominee’s and continuing director’s qualifications and relevant experience is provided in the individual biographical descriptions above.
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Diversity
We believe that Envestnet’s Board represents the varied and multifaceted nature of the business environment in which the Company operates. Envestnet is committed to diversity of gender, ethnicity and race. Assuming the re-election of all nominees to the Board, following the 2024 Annual Meeting, 71% of our Board members self-identify as female and/or from ethnically or racially diverse backgrounds.
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Gender
Racial/Ethnic Diversity*
Tenure
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*
Includes two current directors who self-identify as Black or African American and one current director who self-identifies as Hispanic or Latino.
Leadership
One of our Board’s key responsibilities is to determine an optimal leadership structure to provide effective oversight of management and operate a fully engaged, high-quality Board. The Board understands that no single approach to Board leadership is universally accepted and that the appropriate leadership structure may vary based on a company’s size, industry, operations, history and culture. With this in mind, the Nominating and Governance Committee of our Board evaluates the Board’s leadership structure on a regular basis.
The Company’s by-laws and Corporate Governance Guidelines do not require that the positions of Board Chair and CEO be separate, but rather permit the Board to determine the most appropriate leadership structure for the Company at any given time and give the Board the ability to choose a Chair that it deems best for the Company. By retaining flexibility to adjust the Company’s leadership structure, the Board believes that it is best able to provide for appropriate management and leadership of the Company as circumstances warrant.
At present, the Board has determined that separating the positions of CEO and Chair is the most appropriate leadership structure for the Company. The Board believes that separating the positions allows our CEO to focus on strong executive leadership and the day-to-day operational, financial and performance matters vital to Envestnet’s business, and the Chair to focus on leading the Board in providing independent oversight of management. The Chair’s responsibilities include, among other things: presiding over all meetings of the Board and executive sessions of the independent directors; presiding over meetings of shareholders; serving as a liaison between management of the Company and the Board; and discussing with the CEO agendas for Board meetings and information to be provided to the Board. Other responsibilities of the Chair are determined by the Board from time to time.
In January 2024, upon William Crager’s decision to step down as our CEO effective March 31, 2024, James L. Fox agreed to serve as Interim CEO as the Board conducts its search for a permanent CEO, commencing April 1, 2024 for an initial six-month period, and which may be extended for additional one-month periods at the Board’s discretion. The Board believes that Mr. Fox, who has served as a director since 2015 and as Chair of the Board since 2020, is best situated to serve as our Interim CEO because of his extensive experience serving as a chief executive officer and business leader in the financial services industry and knowledge of the Company’s business and industry.
During the interim period while the Board conducts a search for our permanent CEO, the roles of Chair of the Board and Interim CEO will be combined under Mr. Fox. In the event Mr. Fox’s service as Interim CEO extends beyond the initial six-month period, or if the Board otherwise determines that doing so would be in the best interests of the Company and its shareholders, the independent directors of the Board will designate a Lead Independent Director to ensure the appropriate level of oversight continues between our independent directors and the Interim CEO. If appointed, the Lead Independent Director will preside over all meetings of the Board at which the Chair is not present and executive sessions of independent directors; call meetings of the non-management directors, as appropriate; consult with the Chair regarding Board meeting agendas, materials circulated to the Board and the Board’s calendar; solicit suggestions for agenda items from other directors and determine the frequency and length of Board meetings; and act as the liaison between the independent directors and the Chair. The Lead Independent Director also will serve as a representative to external constituents of the Company, including shareholders.
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Structure
Our by-laws provide for a minimum of five and a maximum of 11 directors and empower our Board to fix the exact number of directors and appoint persons to fill any vacancies on the Board until the next annual meeting.
Our Board currently is divided into three classes with the terms of office of each class ending in successive years. On March 14, 2024, our Board approved and adopted amended and restated by-laws to, among other things, declassify the Board and phase in the annual election of directors, commencing with the 2024 Annual Meeting. Declassification will be complete and all directors will be elected to annual terms beginning with the 2026 annual meeting of shareholders.
Independence
Based on its most recent review, conducted in March 2024, our Board determined that the following directors are independent under the listing standards of the NYSE: Mr. Aguilar, Ms. Crowell, Ms. Lane, Ms. Mosley, Mr. Smith, Ms. Taylor Wolfe and Ms. Turner. Mr. Fox also was determined independent until the time of his agreement with the Company to assume the role of Interim CEO in January 2024. Mr. Crager, whose service as a director will end following the 2024 Annual Meeting, is not considered an independent director because Mr. Crager served as our CEO through March 31, 2024. In addition, in February 2023, our Board determined that Ross Chapin, who retired from the Board in June 2023, was independent during the time he served on the Board during fiscal 2023. In making its determination of independence, the Board applied the categorical standards for director independence set forth in the NYSE’s rules and also determined, based on all known relevant facts and circumstances applicable to each individual director, that no other material relationships existed between us and these directors. The Board also considered the other directorships held by the independent directors and determined that none of these directorships constituted a material relationship with us.
In addition, our Board determined that Mr. Smith, Ms. Taylor Wolfe, Ms. Turner and Mr. Fox (during his tenure on the Audit Committee during fiscal 2023), the members of our Audit Committee, satisfy the audit committee independence requirements of Rule 10A-3 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) and that Ms. Crowell, Mr. Smith and Ms. Turner, the members of our Compensation Committee, satisfy the additional independence requirements for members of the compensation committee under the NYSE listing standards.
Our independent directors meet at regularly scheduled executive sessions without the participation of management. Mr. Fox, our Chair, or the Lead Independent Director, if applicable, is the presiding director for executive sessions of independent directors.
Committees
During 2023, our Board had five standing committees that perform certain delegated functions on behalf of the Board. The five standing committees are: an Audit Committee, a Compensation Committee, a Compliance and Information Security Committee, a Nominating and Governance Committee and a Strategy Committee.
Luis
Aguilar
William
Crager
Gayle
Crowell
James
Fox
Wendy
Lane
Valerie
Mosley
Gregory
Smith
Lauren
Taylor Wolfe
Barbara
Turner
Meetings
Held in
2023
Audit Committee
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5
Compensation Committee
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6
Compliance and Information Security Committee
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4
Nominating and Governance Committee
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5
Strategy Committee
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3
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Chair
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Member
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Information in the table above reflects our committee meetings and Board composition as of and for the year ended December 31, 2023. James L. Fox resigned as Chair and a member of the Compensation Committee and as a member of the Audit and Nominating and Governance Committees in January 2024 in connection with his appointment as Interim CEO. William Crager will step down as a member of the Strategy Committee following the 2024 Annual Meeting. Other changes to committee assignments since December 31, 2023 are described below under “—Committee Changes.”
Audit Committee
2023 Members:
Mr. Smith (Chair)
Mr. Fox
Ms. Taylor Wolfe
Ms. Turner
Mr. Chapin (member until June, 2023)
Committee
Meetings held
in 2023: 5
The Audit Committee provides oversight of the integrity of our financial statements and financial reporting process, the system of internal controls, the audit process, the performance of our internal audit program, and the performance, qualification, and independence of the independent registered public accounting firm KPMG LLP.
Our Audit Committee hires, determines the compensation of, and decides the scope of services performed by our independent registered public accounting firm. No member of our Audit Committee currently serves on the audit committees of more than two public companies (including Envestnet). Our Audit Committee charter provides that if a member of the Audit Committee simultaneously serves on the audit committees of more than three public companies, the Board will determine if such simultaneous service would impair the ability of such member to effectively serve on the Audit Committee.
Only independent directors may serve on the Audit Committee. The Board has determined that each member of the Audit Committee satisfies the applicable audit committee independence requirements of the NYSE and the Exchange Act.
The Board has determined that each member of the Audit Committee satisfies the financial literacy requirements of the NYSE and that each is an audit committee financial expert, as that term is defined under SEC rules. For additional information about the qualifications of the Audit Committee members, see their respective biographies set forth in “Proposal 1: Election of Directors.”
Audit Committee meetings are usually held in conjunction with the regularly scheduled meetings of the Board. At least quarterly, the Audit Committee met with management, KPMG LLP, the Chief Financial Officer, the Principal Accounting Officer and the General Counsel to review, among other matters, the overall scope and plans for the independent audit, and the results of such audit; critical accounting estimates and policies; and compliance with our conflict of interest and Code of Business Conduct and Ethics policies.
At least quarterly in 2023, the Audit Committee met or had an opportunity to meet in executive session (i.e., without management present) with representatives of KPMG LLP to discuss the results of KPMG LLP’s work.
In connection with his appointment as Interim CEO in January 2024, Mr. Fox resigned as a member of the Audit Committee.
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Compensation Committee
2023 Members:
Mr. Fox (Chair)
Ms. Crowell
Mr. Smith
Mr. Chapin (member until June, 2023)
Committee
Meetings held
in 2023: 6
The Compensation Committee is responsible for evaluating the performance of the CEO based on corporate goals and objectives and, with the other independent directors, sets the CEO’s compensation. The Compensation Committee also evaluates the performance of our senior management and determines executive compensation. Additionally, the Compensation Committee reviews and makes recommendations to the full Board regarding director compensation. The Compensation Committee consults with the Nominating and Governance Committee and works with the CEO and Chair of the Board in the Nominating and Governance Committee’s review of succession planning for Envestnet’s CEO, Chair of the Board and, as deemed necessary, any other executive officers. Only independent directors may serve on the Compensation Committee. The Board has determined that each member of the Compensation Committee satisfies the applicable compensation committee independence requirements of the NYSE.
In connection with his appointment as Interim CEO in January 2024, Mr. Fox resigned as the Chair and a member of the Compensation Committee. As of January 2024, Ms. Crowell was appointed to replace Mr. Fox as the Chair of the Compensation Committee, and Ms. Turner was appointed to the Compensation Committee.
Compliance and Information Security Committee
2023 Members:
Ms. Crowell (Chair)
Mr. Aguilar
Ms. Mosley
Ms. Turner
Committee
Meetings held
in 2023: 4
The Compliance and Information Security Committee provides oversight of, and reviews, assesses and makes recommendations to our Board regarding, our regulatory compliance programs and information technology security framework.
A majority of the directors that serve on the Compliance and Information Security Committee must be independent. The current committee is comprised entirely of independent directors.
Nominating and Governance Committee
2023 Members:
Mr. Aguilar (Chair)
Mr. Fox
Ms. Lane
Ms. Mosley
Committee
Meetings held
in 2023: 5
The responsibilities of the Nominating and Governance Committee include identifying individuals qualified to become Board members, recommending director nominees to the Board, and developing, assessing and recommending corporate governance guidelines. The Nominating and Governance Committee reviews at least annually the Company’s charitable giving, including the Envestnet Cares initiative. In addition to general corporate governance matters, the Nominating and Governance Committee assists the Board and its committees in their self-evaluations. The Nominating and Governance Committee, in consultation with the Compensation Committee, reviews annually, or more often if appropriate, succession planning for Envestnet’s CEO, Chair of the Board and, as deemed necessary, any other executive officers.
A majority of the directors that serve on the Nominating and Governance Committee must be independent. Currently, the Nominating and Governance Committee is composed entirely of independent directors, as defined by the NYSE listing standards.
In connection with his appointment as Interim CEO in January 2024, Mr. Fox resigned as a member of the Nominating and Governance Committee.
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Strategy Committee
2023 Members:
Mr. Smith (Chair)
Mr. Crager
Ms. Crowell
Mr. Fox
Mr. Chapin (Chair until June, 2023)
Committee
Meetings held
in 2023: 3
The Strategy Committee reviews and provides guidance to the management team and the Board with respect to the Company’s strategic initiatives. The Strategy Committee reviews and makes recommendations to the Board regarding specific strategic initiatives, including acquisitions, divestitures, joint ventures, and strategic alliances. A majority of the directors that serve on the Strategy Committee must be independent.
Committee Changes
Effective January 2024, Ms. Crowell replaced Mr. Fox as the Chair of the Compensation Committee and Ms. Turner joined the Compensation Committee. Also, effective January 2024, Mr. Fox resigned as a member of the Audit Committee, Compensation Committee and Nominating and Governance Committee.
BOARD RESPONSIBILITIES
Overview
Our Board oversees our business and monitors the performance of management. In addition to its more traditional business and management oversight responsibilities, the Board also monitors the Company’s activities and practices related to ESG matters, including climate-related risks and opportunities. The directors keep themselves up to date on the Company by discussing matters with the CEO, other key executives and our principal external advisors, such as outside legal counsel, outside auditors, investment bankers and other consultants, by reading the reports and other materials that are provided regularly and by participating in Board and committee meetings.
Meetings
Envestnet holds regular Board meetings that last approximately two days each. In addition, our Board holds an annual business review meeting to assess specific areas of our operations and to learn about general trends affecting the wealth management industry. The Company provides our directors with the opportunity to attend continuing education programs.
The Board usually meets seven times per year in regularly scheduled meetings but will meet more often if necessary. From time to time, the Board holds telephonic sessions on various topics. During 2023, the Board met 17 times, including through telephonic sessions. All of our directors attended at least 75% of the aggregate number of meetings of the Board and the standing committees on which they served during the year ended December 31, 2023.
Recruitment, Nomination and Succession Planning
The Nominating and Governance Committee works with the Board on an annual basis to evaluate the Board as a whole and its individual members in light of the needs of the Board, including the extent to which the current composition of the Board reflects a wide-ranging mix of knowledge, experience, skills, viewpoints, tenures and backgrounds. In accordance with its charter, the Nominating and Governance Committee identifies potential nominees for directors from various sources, including in partnership with external search firms. When reviewing candidates’ qualifications, the Nominating and Governance Committee considers the relevance of their experience and background as well as their independence, judgment, understanding of our business or related industries, education and professional background (including current employment and other board memberships), reputation for integrity and such other factors as the Nominating and Governance Committee determines are relevant in light of the needs of the Board and our Company. Among other things, the Nominating and Governance Committee considers relevant experience in financial services, investment management, technology,
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executive leadership, strategic planning, financial reporting, accounting, risk management, cybersecurity and compliance and to be particularly relevant to the Board and the Company. The Board evaluates each individual in the context of the Board as a whole, with the objective of recommending a group that can best perpetuate the success of our business and represent shareholder interests through exercise of sound judgment, using its diversity of experience. The Nominating and Governance Committee also engages a third-party consultant to assist in the review and evaluation of potential nominees. In addition, the Board believes that it is important that the Board members represent a diverse mix of viewpoints and that the skills and backgrounds collectively represented on the Board should reflect the varied and multifaceted nature of the business environment in which the Company operates.
Although the Board does not have a specific policy regarding diversity, the Board takes into account, and any search firm engaged to assist in identifying candidates for nomination to the Board is directed to take into account, these attributes and the current composition of the Board.
In evaluating the suitability of individual Board members, the Board and the Nominating and Governance Committee consider numerous factors, such as the individual’s general understanding of marketing, finance and other disciplines relevant to the success of a publicly traded company; performance as a member of the Board; understanding of the Company’s business; education and professional background, including current employment and other Board memberships; reputation for integrity; diversity contributed to the Board in terms of gender, race, ethnicity, age, religion, sexual orientation, geographic representation and any other personal attributes considered relevant. The Board evaluates each individual in the context of the Board as a whole, with the objective of recommending a group of directors with a breadth and depth of knowledge, experience, skills, viewpoints and backgrounds to best advance the success of the Company’s business and represent shareholder interests through the exercise of sound judgment. In determining whether to recommend a director for re-election, the Nominating and Governance Committee also considers the director’s past attendance at meetings and participation in and contributions to the Board.
Once the Nominating and Governance Committee selects qualified candidates and reviews its recommendations with the Board, the Board decides whether to nominate the person for election to the Board. Elections typically occur at our annual meeting but, upon the recommendation of the Nominating and Governance Committee, the Board may approve additions to the Board between annual meetings.
The Nominating and Governance Committee also annually reviews its Board refreshment and service length processes as part of its formal director self-evaluation process, described in more detail in the section herein entitled “—Director Self-Evaluations.”
In connection with its self-evaluation described below under “—Director Self-Evaluations,” the Nominating and Governance Committee assesses whether it effectively nominates candidates for director in accordance with the above-described standards specified by the Company’s Corporate Governance Guidelines. See each nominee’s and director’s biography in this proxy statement for a description of the specific experience that each such individual brings to our Board.
Succession planning is a priority for the Board and Company management, with the objective of having a pipeline of diverse leaders for today and the future. To achieve this objective, the Board and management take a proactive approach. We have established a disciplined talent management and succession planning process at the senior level, and we have in place both an emergency and a non-emergency succession plan for the CEO and Chair of the Board. The Board works with a third-party consultant to assist with succession planning.
The Nominating and Governance Committee, in coordination with the Compensation Committee, annually reviews the succession plan for the CEO and Chair of the Board upon retirement, death or disability. The Nominating and Governance Committee’s review of the succession plan for the CEO is followed by discussion with the non-executive directors of the Board led by the Chair of the Board. The Nominating and Governance Committee, in coordination with the Compensation Committee, also annually reviews the succession plan for such other executive officers as the Committee deems appropriate to safeguard continuity in Envestnet’s management, which is then discussed with the full Board. These processes enable the Board to address both long-term planned occurrences, such as retirement or change in roles, as well as short-term unexpected events.
In connection with Mr. Crager’s determination to step down as our CEO effective March 31, 2024, the Board created a special search committee to identify suitable candidates and to make a recommendation to the full
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Board for a new chief executive officer. Mr. Smith, the Chair of the Audit Committee, serves as Chair of the CEO search committee. The other members are Gayle Crowell, Lauren Taylor Wolfe and Barbara Turner. The CEO search committee, after evaluating a number of executive search firms, has engaged a search firm to assist with identifying suitable candidates.
Risk Oversight
Envestnet’s policies and procedures relating to risk assessment and risk management are overseen by our Board. The Board takes an enterprise-wide approach to risk management that is designed to support our business plans within established levels of acceptable risk tolerances. A fundamental part of risk assessment and risk management involves not only understanding key enterprise risks’ likelihood of occurrence, potential impact and management’s initiatives to mitigate those risks, but also understanding what constitutes an appropriate level and tolerance of risk appropriate for our Company. The Board regularly considers our risk profile, including during their annual review and approval of our business plan.
The involvement of the Board in setting our business strategy is a key component of its assessment of management’s risk tolerance and also its determination of an appropriate overall level of risk for our Company. Committees of the Board oversee certain risks and the management of such risks relevant to their respective committee charter. The entire Board is regularly informed through committee reports and management presentations about such risks. Any risks that may arise related to ESG matters are overseen by our full Board.
The Audit Committee of the Board reviews our policies and practices with respect to risk assessment and risk management and discusses with management our major financial risk exposures and the steps that have been taken to monitor and control such exposures.
The Compensation Committee assesses our executive compensation programs annually to ascertain any potential material risks related to compensation policies and practices. In conducting this assessment, the Compensation Committee focuses on our incentive compensation programs in order to identify any general areas of risk or potential for unintended consequences that exist in the design of our compensation programs and to evaluate our incentive plans relative to our enterprise risks to identify potential areas of concern, if any.
The Compensation Committee determined that our compensation programs, policies and practices are designed and administered with the appropriate balance of risk and reward in relation to our overall business strategy. The Compensation Committee further determined that the Company’s policies and practices are not structured to encourage executives to take unnecessary or excessive risks, and therefore do not create risks reasonably likely to have a material adverse effect on our Company.
The Nominating and Governance Committee manages risks associated with general corporate governance and, in consultation with the Compensation Committee, succession planning.
The Compliance and Information Security Committee reviews potential risk related to regulatory compliance requirements and reviews and assesses our regulatory compliance programs. The Compliance and Information Security Committee also reviews cybersecurity risk, and reviews and assesses our information technology security framework.
Director Self-Evaluations
The Board and each committee of the Board conduct a formal annual self-evaluation to assess the business skills, experience, and background represented on the Board and to determine whether the Board and its committees are functioning effectively. During the year, the Nominating and Governance Committee receives input on the Board’s performance from directors and discusses the input with the full Board and oversees the self-evaluation process. The self-evaluation focuses on whether the Board is operating effectively and on areas in which the Board or management believes that the Board or any of its committees could improve. The self-evaluation may be in the form of written or oral questionnaires or interviews and is conducted by a third party. Each year the Nominating and Governance Committee discusses and considers the appropriate approach and approves the form of the self-evaluation.
The results of the self-evaluation are reviewed by the Nominating and Governance Committee and shared with the full Board. Any recommendations for improvement are reviewed by the full Board and appropriate plans are initiated by the Board to address such recommendations.
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Continuing Education
We expect our directors to be well-informed about the Company’s business, the competitive landscape in which the Company operates and issues currently affecting the Company, the wealth, investment management and technology industries, matters of corporate governance and the broader economy. Because our Board believes that ongoing director education is important to the development of best practices and helps directors fulfil their fiduciary duties to the Company’s shareholders, directors are encouraged to participate in continuing education programs.
OUR CORPORATE GOVERNANCE FRAMEWORK
Overview
In exercising its fiduciary duties, the Board is committed to strong corporate governance, as reflected through its policies and practices. We review annually, internally and with the Board, the provisions of the Sarbanes-Oxley Act of 2002, the rules of the SEC and the NYSE’s listing standards regarding corporate governance policies and processes and are in compliance with the rules and listing standards. Envestnet has adopted Corporate Governance Guidelines that provide the framework for the Board’s governance and cover issues such as the Board’s purpose, director qualification standards (including independence), director responsibilities, executive sessions and Board self-evaluations. The Board reviews regularly our policies, practices and processes in the context of current corporate governance trends, shareholder feedback, regulatory changes and recognized best practices and revises such policies when appropriate. Each of Envestnet’s Board committees, which include the Audit, Compensation, Nominating and Governance, Compliance and Information Security and Strategy Committees, has adopted a charter defining their respective purposes and responsibilities. Additionally, we require compliance with our Code of Business Conduct and Ethics policy, applicable to all of our employees and directors.
Copies of our governance documents, including our Corporate Governance Guidelines, Code of Business Conduct and Ethics and each committee charter, are available on our website located at www.envestnet.com under “Investor Relations—Governance—Governance Documents” or may be requested by contacting our Corporate Secretary via telephone at (312) 827-2800, facsimile at (312) 621-7091 or e-mail at corpsecy@envestnet.com. Our website address is provided as an inactive textual reference only; the information provided on or accessible through our website is not part of this proxy statement.
Related Party Transaction Policies and Procedures
Our Board has adopted a written policy regarding review and approval of any Related Party transactions (the “Related Party Transactions Policy”). This policy applies to any transaction, arrangement or relationship in which we (including any of our subsidiaries) were, are, or will be a participant, the amount involved exceeds $120,000 annually and in which any director, executive officer, 5% or greater shareholder or certain other related parties or entities (each, a “Related Party”), has a direct or indirect material interest. We refer to these transactions as “Related Party Transactions.” Under the policy, the Audit Committee must approve all Related Party Transactions proposed and, if appropriate, ratify any such transaction previously commenced and ongoing. Any related party transactions that are ongoing in nature will be reviewed annually at a minimum. In its evaluation, the Audit Committee considers all of the relevant facts and circumstances in determining whether to approve a Related Party Transaction, including:

The benefits to us of the proposed Related Party Transaction;

The impact on a director’s independence in the event the Related Party is a director, an immediate family member of a director, or an entity in which a director is a partner, shareholder or executive officer;

The creation of an actual or apparent conflict of interest;

The availability of other sources for comparable products or services;

The terms of the proposed Related Party Transaction;

The Related Party’s interest in the transaction; and

The terms available to unrelated third parties or to employees generally.
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The Audit Committee will approve only those Related Party Transactions that are in, or are not inconsistent with, the best interests of our Company and our shareholders, as the Audit Committee determines in good faith.
The following types of transactions do not require approval or ratification under this policy:

Transactions involving the purchase or sale of products or services in the ordinary course of business, not exceeding $120,000;

Transactions in which the Related Party’s interest derives solely from his or her service as a director of another corporation or organization that is a party to the transaction;

Transactions in which the Related Party’s interest derives solely from his or her ownership of less than 10% of the equity interest in another person (other than a general partnership interest) which is a party to the transaction;

Transactions in which the Related Party’s interest derives solely from his or her service as a director, trustee or officer (or similar position) of a not-for-profit organization or charity that receives donations from us;

Compensation arrangements of any NEO that are reported in our annual meeting proxy statement and compensation arrangements of any executive officer (other than an individual who is an immediate family member of a Related Party) that have been approved by the Compensation Committee of our Board and that are reported in our annual meeting proxy statement or would be reported if the executive officer were a NEO;

Director compensation arrangements that have been approved by the Board and that are reported in our annual meeting proxy statement;

Transactions with an entity and its affiliates that is considered a Related Person solely because the entity has reported beneficial ownership of more than 5% of Envestnet’s common stock on a Schedule 13G if the entity is a bank, broker or dealer, insurance company, investment adviser, investment company or other entity that qualifies to report its ownership on Schedule 13G, provided that such transaction is (i) in the ordinary course of business of each of the parties and (ii) on substantially the same terms as those prevailing at the time for comparable transactions with non-affiliates (“Institutional Investor Ordinary Course Transactions”); and

Such other exceptions as may be set forth in Item 402(a) of Regulation S-K.
Related Party Transactions
From time to time, institutional investors, such as large investment management firms, mutual fund management organizations and other financial organizations, with whom we conduct business in the ordinary course on an arm’s length basis, become beneficial owners of 5% or more of our common stock through the aggregation of holdings of their affiliates and/or on behalf of other beneficial owners for whom they act as investment advisor or investment manager. We engaged in the transactions described below with shareholders or their affiliates that owned more than 5% of our common stock at the time of the transaction and with other related parties, and we may continue to transact similar business during 2023.
BlackRock, Inc. and its subsidiaries (“BlackRock”) –  In 2023, we paid BlackRock approximately $4,100,000 for use of various BlackRock investment models and strategies, pursuant to pre-existing model licensing and asset management agreements, and for a license to use its Aladdin wealth platform.
Pursuant to the model license and asset management agreements, our subsidiary Envestnet Asset Management received from BlackRock various investment model and portfolio maintenance fees, and other data analytics fees totaling approximately $80,000 in 2023. In 2023, BlackRock paid our subsidiary Yodlee approximately $1,570,000 under a pre-existing data license agreement. BlackRock paid Envestnet approximately $450,000 in sponsorship and events fees in 2023.
The foregoing transactions constituted Institutional Investor Ordinary Course Transactions and therefore did not require review, approval or ratification under our Related Party Transactions Policy.
Vanguard Group, Inc. and its subsidiaries (“Vanguard”) –  In 2023, Vanguard paid our subsidiary Yodlee approximately $1,470,000 for data aggregation, account verification and technology services, pursuant to a pre-existing master application service provider agreement. In 2023, Vanguard paid to our subsidiary Envestnet Asset Management various investment model maintenance and data analytics fees totaling approximately $300,000.
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The foregoing transactions constituted Institutional Investor Ordinary Course Transactions and therefore did not require review, approval or ratification under our Related Party Transactions Policy.
JPMorgan Chase & Co. and its subsidiaries (“JPMorgan”) –  In 2023, we paid JPMorgan approximately $2,070,000 for use of various JPMorgan investment models and investment strategies, pursuant to pre-existing model licensing and asset management agreements.
In 2023, our subsidiary Yodlee received approximately $6,660,000 from JPMorgan for data aggregation, account verification and technology services pursuant to a pre-existing master application service provider agreement. In 2023, Envestnet, including its subsidiaries, received approximately $10,645,000 for financial planning solution licensing fees and related professional services, sub-advisory and technology fees, and retirement solutions license and service fees. Pursuant to these agreements, Envestnet Asset Management received from JPMorgan various investment model and portfolio maintenance fees and data analytics fees in 2023. JPMorgan paid Envestnet approximately $25,000 in sponsorship and events fees in 2023.
The foregoing transactions constituted Institutional Investor Ordinary Course Transactions and therefore did not require review, approval or ratification under our Related Party Transactions Policy.
Upward Wealth, Inc. (d/b/a BrightUp) (“BrightUp”) –  In 2023, BrightUp paid our subsidiary Yodlee aggregate payments of under $120,000 for data aggregation, account verification and technology services pursuant to a pre-existing master application service provider agreement with Yodlee. BrightUp is a company founded by Valerie Mosley, one of our directors, to democratize financial wealth-building and personal well-being through providing financial advice to historically underserved markets, including low income and minority investors. The terms of the master application service provider agreement were originally reviewed and approved by our Audit Committee in 2020 under our Related Party Transactions Policy.
Cooperation Agreement with Impactive Capital –  On March 27, 2023, Envestnet entered into a cooperation agreement (the “Cooperation Agreement”) with Impactive Capital LP and Impactive Capital Master Fund LP (together with their respective affiliates, “Impactive”). Pursuant to the Cooperation Agreement, among other things, the Board appointed Ms. Taylor Wolfe and Ms. Lane as directors of the Company effective upon entry into the Cooperation Agreement, and also added Ms. Taylor Wolfe to the Audit Committee and Ms. Lane to the Nominating and Governance Committee. Impactive has agreed to abide by certain voting commitments and standstill restrictions. The Cooperation Agreement also contains customary mutual non-disparagement provisions. Subject to certain exceptions set forth in the Cooperation Agreement, the Cooperation Agreement will remain effective until the later of the 2024 Annual Meeting and 60 days after the date on which Ms. Taylor Wolfe is no longer a member of the Board.
A summary of the Cooperation Agreement was included in a Current Report on Form 8-K filed by the Company with the SEC on March 28, 2023, and the full Cooperation Agreement was filed as an exhibit to that filing.
Restrictions on Short-Term Speculative Transactions and Hedging
We consider it improper and inappropriate for directors, officers, employees, and temporary contract workers (whom we refer to as “covered persons”) to engage in short-term or speculative transactions in our securities. Consequently, we have adopted a policy that prohibits covered persons from engaging in short sales of our securities (sales of securities that are not then owned), including “sales against the box” ​(sales with delayed delivery) and in transactions in publicly traded options on our securities (such as puts, calls and other derivative securities) on an exchange or in any other organized market. We also only allow “standing orders” for a brief period of time.
Furthermore, we believe that certain forms of hedging or monetization transactions, such as zero-cost collars and forward sale contracts, may result in a misalignment of our interests and the interests of covered persons. Accordingly, we have adopted a policy that prohibits hedging transactions and all other similar forms of monetization transactions. For purposes of this policy, hedging includes the purchase of financial instruments (including prepaid variable forward contracts, equity swaps, collars and exchange funds), or engaging in any other transactions that hedge or offset, or are designed to hedge or offset, any decrease in the market value of our securities.
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Margin Accounts and Pledging
Envestnet’s current policy permits covered persons to hold our securities in margin accounts and pledge our securities in limited circumstances to strike an appropriate balance between the ability of covered persons to manage their financial affairs with the potential adverse impact to shareholders and the Company that could result from the pledging of a significant number of Company securities by covered persons. Covered persons are prohibited from holding our securities in a margin account or pledging our securities as collateral for a loan unless the covered person clearly demonstrates the ability to repay any obligations arising under the margin account or any loan without resorting to the securities held in the margin account or pledged securities in the case of a loan. We believe that a complete ban on pledging could discourage our executive officers, directors and other covered persons from owning significant levels of Envestnet securities, which we believe would negatively affect shareholders.
Envestnet securities may constitute a significant portion of our officers’ and directors’ personal assets. As a result, situations may arise in which using Envestnet securities as collateral for financial obligations or holding Envestnet securities in a margin account is a preferable means of obtaining liquidity than solely through decreased security ownership. Absent the ability to pledge Envestnet securities in this manner, an officer or director may be forced to sell shares, which is not in our shareholders’ best interests. An absolute prohibition on pledging could create a disincentive for our officers and directors to hold substantial amounts of Envestnet securities for long time periods. Although securities held in a margin account or pledged as collateral for a loan may be sold by the broker if a covered person fails to meet a margin call or by the lender in foreclosure if the covered person defaults on the loan, we believe that our policy’s requirement that the covered person demonstrate the ability to repay any obligations arising under the margin account or any loan both effectively mitigates the risk that forced sales of pledged shares could prompt a broader sell-off or further depress a declining stock price and provides our officers and directors with reasonable flexibility to use their Envestnet securities as collateral and liquidity, encouraging retention of substantial ownership of our securities.
Code of Business Conduct and Ethics
We are committed to upholding ethical standards in all of our corporate and business activities. The Company has long maintained the “Code of Business Conduct and Ethics,” which sets forth the values, principles and business practices that guide the business conduct of Envestnet, as discussed further below in the section entitled “Environmental, Social and Governance—Promoting Strong Corporate Governance—Code of Business Conduct and Ethics.”
SHAREHOLDER ENGAGEMENT
Our Board is committed to acting in the best interests of the Company’s shareholders, and views ongoing dialogue with shareholders as a critical component of the Company’s corporate governance program. Our Board believes such ongoing dialogue promotes transparency, improves understanding of shareholder perspective and increases accountability. We maintain an active and broad-based shareholder outreach program, communicating with and seeking input from shareholders on issues of importance to them, including a variety of topics related to our corporate governance practices, executive compensation, ESG matters and business strategy.
Throughout 2023, the Company conducted extensive engagement with investors, including proactively contacting the Company’s top institutional shareholders inviting them to dialogue with us and provide feedback on Envestnet’s corporate governance policies and practices, holding regular conversations with investors and prospective investors, both after earnings and news releases and on an ongoing basis, and attending investor conferences, road shows and other industry events where we had opportunities to engage with current and potential investors.
In response to feedback from shareholders, in addition to the Board’s ongoing evaluation of the corporate governance practices of the Company, market views on best-in-class governance practices, and the preferences of leading proxy advisors, the Board evaluated the benefits of and approved and adopted amended and restated by-laws to, among other things, declassify the Board and phase in annual election of directors over a period of two years, with full implementation at the 2026 annual meeting of shareholders. Additionally, shareholders appreciated our ongoing process of Board refreshment during 2023, which included the appointment of two new continuing directors in 2023, further enhancing the mix of experience, skills, and diversity currently represented on the Board.
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Our ongoing shareholder engagement efforts have allowed our Board to better understand shareholder perspectives and hold productive and informative discussions on a variety of topics, including corporate governance, environmental and human capital matters, executive compensation, financial performance and company strategy.
Shareholder Recommendations and Nominations of Director Candidates
The Nominating and Governance Committee will consider a shareholder’s recommendation for directors by following substantially the same process and applying substantially the same criteria as for candidates recommended by other sources, but the Nominating and Governance Committee has no obligation to recommend such candidates for nomination by the Board. To have a director recommendation evaluated by the Nominating and Governance Committee, a shareholder should provide timely notice of its recommendation with the biographical and background materials set forth in Section 5.2 of our by-laws related to director nominations. Shareholder recommendations for directors should be mailed to: Corporate Secretary, Envestnet, Inc., 1000 Chesterbrook Boulevard, Suite 250, Berwyn, Pennsylvania 19312. No person recommended by a shareholder will become a Company nominee for director and be included in the Company’s proxy statement unless the Nominating and Governance Committee recommends, and the Board approves, such person.
If a shareholder desires to nominate a person for election as director at a shareholders’ meeting, that shareholder must comply with Section 5.2 of our by-laws, which requires, among other things, notice not more than 120 days nor less than 90 days in advance of the anniversary of the date of the proxy statement provided in connection with the previous year’s annual meeting of shareholders. For more information, see the section entitled “Shareholder Proposals for 2025 Annual Meeting.”
Communicating with the Board
Our Board provides a process for shareholders, employees or other interested parties to send communications to our Board. Shareholders, employees or other interested parties wanting to contact the Board, the independent directors, the Chair of the Board, the Chair of any Board committee, or any other director may send written communications to the Board by email at corpsecy@envestnet.com or by mail c/o Corporate Secretary, 1000 Chesterbrook Boulevard, Suite 250, Berwyn, Pennsylvania 19312. Communication with the Board may be anonymous. The Secretary will forward all communications addressed to the Board, to the Chair of the Audit Committee or the Chair of the Nominating and Governance Committee, who will then determine when it is appropriate to distribute such communications to other members of the Board or to management.
INDEMNIFICATION OF DIRECTORS AND EXECUTIVE OFFICERS
We have entered into agreements to indemnify our directors and certain of our officers in addition to the right to indemnification provided to such persons in our certificate of incorporation and by-laws. These agreements will, among other things, require us to indemnify these individuals to the fullest extent permitted under Delaware law, including for certain expenses (including attorneys’ fees), judgments, fines and settlement amounts incurred by such person in any action or proceeding, including any action by or in our right, on account of services by any such person as a director or officer of our Company or as a director or officer of any of our subsidiaries, or as a director or officer of any other company or enterprise if any such person serves in such capacity at our request. We also intend to enter into indemnification agreements with our future directors and executive officers.
DIRECTOR COMPENSATION
Our Board believes that compensation paid to non-employee directors should be competitive with our peers, align the long-term interests of our directors with those of our shareholders and enable us to attract and retain individuals of the highest quality and expertise to serve on our Board. The Compensation Committee reviews and, based in part on the advice of its independent consultant, makes recommendations to the full Board with respect to the compensation of our independent directors annually. The Board evaluates these recommendations and makes a final determination on the compensation of our directors.
For fiscal year 2023, the fees payable to non-employee directors remained unchanged. Non-employee directors received an annual retainer of $215,000. Directors received $50,000 of the annual retainer in cash and the
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remaining $165,000 in RSUs. The non-employee members of the Board are also entitled to the following additional annual retainers: $90,000 for the Chair of the Board; $30,000 for the Lead Director, if applicable; $25,000 for the Chair of the Audit Committee; $20,000 for the Chairs of the other committees; and $10,000 for all non-Chair committee members for each committee on which they serve. In addition to the retainer amounts, each non-employee director is entitled to receive a fee of $1,000 for telephonic attendance or $5,000 for in-person attendance for each Board and standing committee meeting attended that exceeds the number of meetings contemplated in the annual retainer (“additional meeting fees”). Any such additional annual retainer amounts and additional meeting fees paid to a director for serving on a committee as a Chair or as a member are paid 25% in cash and 75% in RSUs. All non-employee directors receive an initial equity grant of $100,000 of RSUs upon joining the Board, of which 25% vests immediately on the grant date, and then 25% vests annually over the following three years.
Cash amounts are paid quarterly with respect to the pro rata portion of fees earned during that quarter. Equity compensation is granted once a year, no later than March 31st for the amounts earned during the previous year and fully vest on the first anniversary of the grant. All equity grants to our non-employee directors are made pursuant to the Envestnet, Inc. 2010 Long-Term Incentive Plan (“2010 Long-Term Incentive Plan”). We also reimburse all of our directors for their reasonable expenses incurred in attending meetings of our Board or committees.
Minimum Stock Ownership Guidelines
To align the interests of the non-employee members of our Board with the long-term interests of our shareholders, all non-employee directors must maintain an ownership level in our common stock equal to or greater than $300,000. Unvested RSUs and vested stock options held by directors count toward meeting required ownership levels. Directors have four years from the date that they become directors to come into compliance with the ownership guidelines. As of the record date, all of our non-employee directors are in compliance with our stock ownership guidelines.
Director Compensation Table
The following table sets forth the compensation paid to our non-employee directors in 2023. Mr. Crager, our CEO, receives no additional compensation for his service as a director.
Name
Fees Earned
or Paid in Cash
($)
(1)
Stock
Awards
($)
(2)
Total
($)
Luis Aguilar 60,000 195,000 255,000
Ross Chapin(3) 131,000 131,000
Gayle Crowell 62,750 203,250 266,000
James L. Fox 88,250 279,750 368,000
Wendy Lane 53,750 176,250 230,000
Valerie Mosley 57,250 186,750 244,000
Gregory Smith 67,000 216,000 283,000
Lauren Taylor Wolfe 54,000 177,000 231,000
Barbara Turner 56,750 185,250 242,000
(1)
Represents the aggregate cash portion of annual retainers, Board Chair retainer, committee Chair retainers, member committee fees and additional meeting fees, as applicable.
(2)
RSUs were granted on February 29, 2024, with a fair market value of $51.53 per share. The amounts reported represent the aggregate grant date fair value during the fiscal year, as calculated under the Financial Accounting Standards Board’s Accounting Codification Topic 718 (“ASC 718”). Under ASC 718, the grant date fair value is calculated using the closing market price of our common stock on the date of grant, which is then recognized, subject to market value changes, over the requisite service period of the award.
(3)
Effective June 15, 2023, Mr. Chapin retired from the Board. The 75% of his compensation that would ordinarily be accrued and granted as RSUs the following year was instead paid in cash.
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Outstanding Equity Awards
As of December 31, 2023, the following equity awards were outstanding for each non-employee director:
Luis Aguilar 1,745 Stock Options
3,101
Restricted Stock Units
Gayle Crowell 1,745 Stock Options
3,208
Restricted Stock Units
James L. Fox 8,082 Stock Options
4,472
Restricted Stock Units
Wendy Lane Stock Options
1,151
Restricted Stock Units
Valerie Mosley Stock Options
2,969
Restricted Stock Units
Gregory Smith 8,038 Stock Options
3,458
Restricted Stock Units
Lauren Taylor Wolfe Stock Options
1,151
Restricted Stock Units
Barbara Turner Stock Options
1,151
Restricted Stock Units
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ENVIRONMENTAL, SOCIAL AND GOVERNANCE
OVERVIEW
Envestnet is committed to integrating environmental, social and governance factors into our business to help create long-term value for our shareholders, employees and the communities in which we operate. Through the Envestnet platform, we offer a fully integrated solution for advisors to manage sustainable investing solutions for their clients. We believe in being a positive economic force, a responsible citizen in our communities and a mindful steward of the resources we consume. These principles are grounded in a single ultimate aspiration that guides us and inspires us to move forward: making financial wellness a reality for everyone and building a company that strengthens the communities we serve for generations to come.
Additional information on our environmental and social responsibility practices appears on our website. Information contained on the website is not incorporated by reference into this proxy statement or any other report we file with the SEC. Additional information on our engagement with shareholders appears below under the section “Executive Compensation Design—Shareholder Engagement.”
COMMITMENT TO THE ENVIRONMENT
Envestnet recognizes that a healthy, sustainable future requires environmental stewardship, and is committed to being mindful of the resources we consume. Envestnet operates in a relatively low-carbon industry and recognizes that our most significant opportunities to reduce our environmental impact are through our office locations and how our employees work. Since January 2022, Envestnet has reduced our energy consumption by reducing our office space by one-third. Envestnet continues to support flexible work schedules for many of our employees and we make significant use of video-conference capabilities, reducing the GHG emissions from employee commuting and business travel. All of our office locations have recycling programs, use energy-saving lighting and sensors, and water-conserving fixtures. We continue to explore ways to further improve operational effectiveness and decrease our energy usage and carbon emissions.
SOCIAL AND HUMAN RIGHTS STATEMENT
Envestnet conducts our business in a responsible manner for our communities, our employees, our advisors and their clients. As noted in Envestnet’s Human Rights Policy Statement, the Company fully supports the basic rights and freedoms of all individuals, including women and diverse groups, in accordance with the human rights principles enumerated in the United Nations Universal Declaration of Human Rights and the International Labor Organization’s Declaration on Fundamental Principles and Rights at Work. Envestnet emphasizes its commitment by following fair and ethical labor practices, provides meaningful opportunities for development for our employees, promotes giving back to the communities where we live and work, and offers access to sustainable investing solutions. Envestnet’s Supplier Code of Conduct provides guidance to our suppliers on Envestnet’s expectations concerning supplier human rights, environmental practices, and business ethics.
For additional information, please see our website.
DEVELOPING THE FUTURE OF FINANCIAL WELLNESS
Envestnet is committed to developing financial literacy and an understanding of the financial services industry through various initiatives and partnerships, including the Envestnet Institute on Campus, Envestnet | MoneyGuide University Program, the Envestnet Scholarship Program (through EIOC) and Envestnet Education Initiative with EVERFI, Inc. (“EVERFI”).
The Envestnet Institute on Campus
EIOC is a program for university students designed to bridge the gap between academic knowledge and the application of this knowledge in the Wealth and Asset Management industries. Many of our employees have graduated from this key Learning and Development program. As of December 2023, the curriculum is offered at 56 schools, including 5 Historically Black Colleges and Universities. The program includes financial education
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training, mentoring, job placement, and financial education initiatives. Over 7,800 students have completed the program, averaging an approximate 73% completion rate. More than 2,800 women and over 2,400 students of color have completed the program. EIOC continues to support job and internship placements through its résumé database, which contains over 4,500 résumés for employers seeking workforce-ready employees for internships and entry-level positions.
In addition, through the Company’s Envestnet | MoneyGuide University Program, we partner with over 110 universities and colleges to incorporate technology into their financial planning programs by providing free access to MoneyGuide’s software platform. In 2023, over 5,800 students used this financial planning software to gain practical experience and hands-on practice.
The Envestnet Scholarship Program (through EIOC)
Envestnet has partnered with the Center for Financial Planning (“CFP”) on this endeavor as part of its Envestnet Institute on Campus program. Scholarships are offered to qualified individuals seeking to complete a CFP Board-Registered Certificate Program, which then qualifies the student to sit for the CFP® certification exam. Scholarships are offered to qualified individuals who can demonstrate financial need and are from underrepresented populations within the financial planning profession and academia. Through December 31, 2023, the Envestnet Scholarship Program issued 104 scholarship awards totaling over $550,000.
Envestnet Education Initiative with EVERFI
Envestnet supports EVERFI, whose mission is to leverage scalable technology to build innovative, impactful education networks that empower people and transform communities. Envestnet supports EVERFI’s efforts to help teachers, schools, and districts bring real-world skills to students. This partnership supports students ranging from 3rd to 12th grade at no cost to individual schools or school districts in states with principal Envestnet office locations. Envestnet expanded its sponsorship to include seven additional schools, all located in the Greater Raleigh, North Carolina area, in the 2022-2023 school year. In the 2022-2023 school year, Envestnet’s grant brought financial education curricula to 36 schools, reaching over 1,800 students with over 1,800 hours of learning.
Foundation for Financial Planning
Envestnet partners with the Foundation for Financial Planning (“FFP”) to help make financial wellness possible for everyone. FFP is the nation’s leading charity dedicated to advancing pro bono financial planning for at-risk populations including active military members, wounded veterans, people with serious medical diagnoses, seniors and family caregivers, low-income individuals, domestic violence survivors and many more. With the help of Envestnet and other donors, FFP has reached approximately 124,000 people including 23,000 financially vulnerable senior citizens and 2,000 families with the Pro Bono for Cancer Program, through workshops, webinars, and one-on-one financial planning sessions.
SUSTAINABLE INVESTING
Providing access to sustainable investment products and services is an important component of our financial wellness ecosystem, and a key element in building intelligent financial lives. Envestnet is committed to building an end-to-end sustainable investing solution set, with tools embedded into advisor workflows, empowering them to more comprehensively view alignment of client portfolios with sustainable investment preferences. We offer a wide range of capabilities, including portfolio analytics, investment solutions, manager research, overlay technology, reporting, education and thought leadership.
Envestnet became a signatory of the Principles for Responsible Investment on April 1, 2020. As a signatory, we affirm our commitment to empowering wealth managers to embed sustainable investing into their practices. The Principles of Responsible Investment (“PRI”) is an independent entity that has created a set of voluntary and aspirational set of investment principles that offer a menu of possible actions for incorporating ESG issues into investment practices. The goal of the PRI is to create more sustainable capital markets that contribute to a more prosperous world for all. The Principles were developed by an international group of institutional investors reflecting the increasing relevance of environmental, social and corporate governance issues to investment practices. The process was convened by the United Nations Secretary-General. In signing the Principles, we as a service provider publicly commit to adopt and implement them, where consistent with our fiduciary responsibilities.
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SUPPORTING OUR COMMUNITIES
Envestnet is committed to strengthening our communities and empowering employees to make a positive impact. Envestnet fosters community engagement by encouraging employee support through both charitable and volunteer activities. Our charitable focus embraces education, financial literacy and helping those in need in the communities where we work and live. We achieve these goals through dedication to our Envestnet Cares initiative, multiyear partnerships through our Signature Impact initiatives, annual giving to organizations highlighted by employees and multiplying the generosity of employees through a donation matching program. In 2023, Envestnet donated approximately $1.0 million to over 400 organizations.
ENVESTNET CARES
The Envestnet Cares program empowers our employees to engage in their local communities with paid time off for volunteer activities, charitable donation matching, and partnerships with several non-profit organizations. U.S. employees receive a match up to $3,000 annually as well as increased match and limits for special match campaigns. In 2023, Envestnet matched employee charitable gifts to over 400 organizations. Envestnet made charitable contributions to over 20 other organizations that are important to our employees and the communities in which they live. Our employees receive three paid volunteer days per year for use when volunteering for a non-profit organization of their choice during the workweek, or as part of a Company-organized volunteering event. As part of this program, in 2023, Envestnet employees volunteered approximately 4,000 hours.
SIGNATURE IMPACT
Signature Impact initiatives are focused on fostering long-term partnerships with charitable organizations in the communities where we do business. Long-term commitments provide a more predictable source of funding for our charitable partners. By focusing our charitable giving we can have a more meaningful and lasting impact on charities that support education, financial literacy, and people in need. In addition to our relationships with CFP, FFP and EVERFI, we have relationships with several other organizations helping our communities. Our additional Signature Impact Partners include Project HOME, The Southern Poverty Law Center, Americares, Opportunity International and Water.org.
Project HOME’s mission is to empower adults, children and families to break the cycle of homelessness and poverty, to alleviate the underlying causes of poverty, and to enable all of us to attain our fullest potential as individuals and as members of the broader society.
The Southern Poverty Law Center is a catalyst for racial justice in the South and beyond, working in partnership with communities to dismantle white supremacy, strengthen intersectional movements, and advance the human rights of all people.
Americares is a health-focused relief and development organization that saves lives and improves health for people affected by poverty or disaster. Each year, Americares reaches 85 countries on average, including the United States, with life-changing health programs, medicine, medical supplies, and emergency aid. In 2023, Americares delivered over 15 tons of medical supplies to disaster relief efforts.
By providing financial solutions and training, Opportunity International empowers people living in poverty to transform their lives, their children’s futures, and their communities. Their vision is a world in which all people have the opportunity to achieve a life free from poverty, with dignity and purpose.
Water.org is an international nonprofit organization that has positively transformed more than 51 million lives around the world with access to safe water and sanitation through affordable financing. Founded by Gary White and Matt Damon, they have been pioneering market-driven financial solutions to the global water crisis for 30 years, giving women hope, children health, and families a future.
SUPPORTING OUR EMPLOYEES
At Envestnet, we understand that developing and supporting our employees, promoting inclusion and diversity and fostering a work environment in which all individuals are treated with respect and dignity are critical to our
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mission. In order to attract and retain top talent, Envestnet provides competitive base pay and recognizes exceptional work in many ways, including rewards such as annual bonus consideration and long-term equity incentive grants.
We offer a comprehensive suite of benefits designed to support the professional and personal well-being of our employees. Envestnet’s programs and benefits include, among others, health, dental and vision insurance, life insurance, medical and dependent care flexible spending account, short- and long-term disability, accidental death and dismemberment insurance, a 401(k) plan with company matching, student debt repayment, college scholarship plans for employees’ children, adoption assistance, a parental stipend for parents with children under age six, discount programs, paid time off (including volunteer days and parental leave for the birth or adoption of a child), military leave with pay differential, pet benefits, a Wellness Program and an Employee Assistance Program.
Envestnet further demonstrates our commitment to supporting and developing our employees through learning and development opportunities to help employees perform at their best and enjoy fulfilling careers, including online training courses, tuition and certification reimbursements, and mentorship programs.
PROMOTING DIVERSITY AND INCLUSION
At Envestnet, we believe fostering a diverse, inclusive, and accessible organization makes us more successful and is inherent to the way we do business every day. A diverse and inclusive environment encourages innovation, creativity, and productivity, and results in better products, services and outcomes for our clients. We are committed to hiring, developing, and retaining employees irrespective of their race, ethnicity, gender identity or expression, sexual orientation, background, or location.
We nurture and promote our vision for diversity, inclusion and equity through a variety of programs internal to Envestnet as well as leveraging external knowledge and resources to achieve the best outcomes possible for our employees, including through the following activities:

To create the foundation for the culture we want, our Employee Resource Groups (“ERG”) offer a safe space for employees to relate to each other, hear other perspectives and gain insights into solutions and opportunities.

Envestnet Bridges, which was our first employee resource group, continues to offer monthly conversations on topical issues regarding race and individualism, ongoing educational resources and training on inclusive topics such as “Allyship, Understanding Language, and Racism: Why Your Story Matters.”

In 2019, Envestnet launched Women’s Initiative Network (“WIN”) to better understand how we can use our internal strengths and experiences to help women develop to their fullest potential. While our commitment to diversity and inclusion has not changed, we have updated our mission to expand how we think about all women and to support their journey through the workplace and life. To support this purpose, Envestnet announced a rebranded group—Harbor. Harbor aims to support all women in challenging stereotypes, tackling the advancement ceiling, and navigating the path to their futures.

Enclusion launched on Juneteenth of 2022 as the Black and African American Employee Resource Group. Their mission is to support Black and African American community, in and outside of Envestnet walls. They have focused on the development of employees through events like Creating Your Advisory Council and watch parties of Carla Harris’ Ted Talk “How to find the person who can help you get ahead at work.”

Envestnet’s IDEAS Council is an employee-led counsel that is a forum for our ERG efforts, providing guidance, perspective and continuity to better promote a welcoming environment focused on workplace diversity and inclusion.

In order to ensure that our employees have the training and development necessary to our culture and commitment to DEI, every employee must participate in a half-day live DEI training, as well as a broader learning path on LinkedIn Learning. This training is available to all Envestnet employees with courses ranging from Unconscious Bias and Privilege to Dealing with Internalized Microaggression.

As part of our work to provide our employees with the support needed, we created and provided a Gender Transitioning & Gender Affirmation in the Workplace guide that is part of our internal Employee
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ENVIRONMENTAL, SOCIAL AND GOVERNANCE
Handbook, helping to create a respectful workplace for all members of our community, including those of all gender identities and expressions.

Our approach to development includes a number of internal programs which leverage peer-coaching and support—most recently our Global Mentoring Program paired women in India and the U.S. to further develop leadership skills and strengthen internal connections.

We have supported the Black Wharton Undergraduate Association at the University of Pennsylvania as a Silver Donor.

We have continued our partnership with the Greenwood Project, which connects Black and Latinx students to internships within the financial services industry.

We have partnered with the University of Delaware Women’s Leadership since 2021 to help female employees advance in their leadership journey; this work continues through 2024.

We continue to focus on the importance of a diverse candidate pool that offers a variety of skills and abilities for our organization. All Envestnet recruiters are Certified Diversity Recruiters (“CDR”) which ensures we use effective diversity and inclusion talent acquisition practices. When using external recruiting resources in 2022, we added diverse national partners and educational institutions.

The Envestnet Delegates Program (“EDP”) focuses on finding high performing/high potential employees and providing these individuals with development opportunities and increased access to leaders, information, and training. The EDP participants are our next generation leaders, and this is one way Envestnet continues to promote and support our diverse employees in their career progression.

Envestnet became the inaugural ambassador for Money Management Institute, an organization with a mission to prepare underrepresented talent for the fintech industry.
PROMOTING STRONG CORPORATE GOVERNANCE
Envestnet is committed to the long-term success of our business, as well as our shareholders, customers and employees, through strong corporate governance and ethical business practices. Every Envestnet employee is expected to embody our values at every level of the organization. One of the ways we create an organization that is respectful, ethical and accountable is through our Code of Business Conduct and Ethics (“Code of Conduct”) and related Whistleblower Policy.
Code of Business Conduct and Ethics
The Code of Conduct is applicable to all directors, officers and employees, and serves as an ethical compass and sets forth basic principles to guide day-to-day activities. The Code of Conduct addresses, among other things, conflicts of interest, corporate opportunities, confidentiality, fair dealing, protection and proper use of company assets, compliance with laws and regulations, including insider trading laws and the Foreign Corrupt Practices Act of 1977, and reporting illegal or unethical behavior. The Code of Conduct also sets forth Envestnet’s firm commitment to equal opportunity and treatment for employees in all aspects of employment, a work environment in which all individuals are treated with respect and dignity and intolerance of discrimination or harassment of any kind. Our commitment to diversity, equity and inclusion reflects an understanding and acceptance of diverse points of view, abilities, backgrounds and experiences. This commitment applies to every aspect of our business, and we firmly stand against discrimination and harassment of any type without regard to race, color, religion, age, national origin, disability status, genetics, protected veteran status, sexual orientation, gender identity or expression, or any other characteristic protected by federal, state, or local laws. The Board reviews the Code of Conduct on an annual basis and makes changes as appropriate.
Whistleblower Policy
Our employees, officers, directors and temporary/contract employees have an obligation to report any conduct that may be unethical, illegal or otherwise inconsistent with the Code of Conduct. The Code of Conduct sets forth one method for confidentially and anonymously reporting concerns about conduct that may be illegal, unethical or otherwise inconsistent with the Code of Conduct, including regarding accounting, internal accounting control or auditing matters involving the Company. The Company handles such reports pursuant to the procedures outlined in its formal Whistleblower Policy. The Company will not retaliate against any employee, officer or director who makes a good faith report or assists in the investigation of a report. Envestnet communicates the
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Whistleblower Policy to employees in a number of ways, including in its annual employee training. The Board reviews the Whistleblower Policy on an annual basis and makes changes as appropriate.
For more information on our corporate governance practices at the Board level, please see the section herein entitled “Corporate Governance and Board Matters—Our Corporate Governance Framework.”
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EXECUTIVE COMPENSATION
COMPENSATION DISCUSSION AND ANALYSIS
This Compensation Discussion and Analysis provides information about our performance, compensation framework, compensation decisions and associated governance for our NEOs in 2023. The following individuals were NEOs and serving in the indicated roles as of December 31, 2023:
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William Crager
Chief Executive Officer(1)
Joshua Warren
Chief Financial Officer(2)
Shelly O’Brien
Chief Legal Officer, General Counsel
and Corporate Secretary
(1)
As announced on January 8, 2024, William Crager stepped down as CEO of Envestnet and each of its subsidiaries effective March 31, 2024. He was a NEO for all of 2023.
(2)
Joshua Warren joined Envestnet as a senior advisor effective October 2, 2023 and assumed the role of CFO on November 15, 2023. Peter D’Arrigo stepped down from the role of CFO effective November 15, 2023. He continued to serve as a senior advisor to the CEO through March 31, 2024. He is included as a NEO for 2023 pursuant to applicable SEC rules.
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EXECUTIVE SUMMARY
Key Highlights | Pay and Performance Alignment | What We Do and Don’t Do
33
COMPENSATION DESIGN
Guiding Principles | Compensation Framework | Use of Market Data | Shareholder Engagement
35
2023 COMPENSATION DECISIONS
Base Salary | Annual Incentive Program | Annual Equity Incentive Awards | Settlement of PSUs granted in 2021 | Benefits and Perquisites
38
EXECUTIVE TRANSITIONS
CFO Transition | CEO transition and Interim CEO Compensation
41
COMPENSATION GOVERNANCE
Role of the Compensation Committee | Role of Advisors | Stock Ownership Guidelines | Clawback Policy | Tax Considerations
43
COMPENSATION COMMITTEE REPORT
46
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EXECUTIVE COMPENSATION
 
EXECUTIVE SUMMARY
KEY HIGHLIGHTS

Awarded equity in February 2023 with a lower value compared to the grants made in 2022. The grant date fair value of the awards in 2023, influenced by the prior year performance, was approximately 39% lower than 2022. This resulted in a reduction in the SCT pay for NEOs.

Secured high say-on-pay support and maintained dialogue with our shareholders. Over 95% of votes were cast in support of our 2023 advisory vote on executive compensation, demonstrating high levels of sustained support for our framework and outcomes.

Reviewed target compensation levels for 2023 with reference to practices among our compensation peers. Ms. O’Brien was the only NEO receiving an increase in her target compensation following a review that indicated a phased market adjustment was appropriate. For 2023 her salary increased from $375,000 to $400,000 and her target annual incentive opportunity increased from 76.8% of salary to 80% of salary.

Implemented modest changes to incentive measures and weightings in 2023. In comparison to 2022, we increased the proportion of the annual cash incentive tied to financial performance from 75% to 80%, focusing on Adjusted Revenue (40%) and Adjusted EBITDA (40%). The remaining portion continued to be based on individual and team performance in 2023.

Approved relative TSR and Adjusted EBITDA Margin measures for PSUs granted in 2023. The vesting of PSUs granted in 2023 will be determined in 2026 based on two equally-weighted performance measures of relative TSR and Adjusted EBITDA Margin, aligned with our long-term strategic priorities of margin enhancement and value creation for shareholders.

Announced transitions of key leadership roles. Mr. Warren was appointed as CFO, replacing Mr. D’Arrigo who stepped down in November. Mr. D’Arrigo remained as a senior advisor until March 31, 2024, and severance payments to Mr. D’Arrigo were limited to what he was entitled to under his employment agreement. In January it was announced that Mr. Crager would step down as CEO of Envestnet and each of its subsidiaries effective March 31, 2024. Mr. Crager will not receive any severance and neither Mr. Crager nor Mr. D’Arrigo will be granted equity awards in 2024 given their planned departures.

Mr. Fox, Chair of our Board, was appointed Interim CEO effective April 1, 2024. He will receive a monthly salary, a grant of RSUs and will be eligible to receive a discretionary cash bonus in respect of his services.
PAY AND PERFORMANCE ALIGNMENT
Envestnet delivered solid results in 2023, despite a challenging economic environment and market headwinds, outperforming the industry in capturing net flows and market share. In 2021, the Company initiated an intentional investment plan focused on unlocking future value on an accelerated basis for our shareholders, accepting that this would impact short-term results and in particular near-term profitability. The impact of these investments was evident in the many strategic achievements summarized below, including:

$58.5 billion in net flows from AUM/A which equates to 8% organic growth;

$30.1 billion of AUM net flows which equates to 9% organic growth; and

4% growth in the platform accounts served to more than 19.1 million.
Key 2023 financial achievements:

Revenue Consistency: Maintained at $1.2 billion, in line with the previous year.

EBITDA Growth: Adjusted EBITDA rose 16%, highlighting our operational efficiency.

Earnings Per Share: Adjusted Net Income per Diluted Share increased by 14%, reflecting our financial health.
There were also many notable strategic accomplishments that reflect the strength of our overall performance in 2023.
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EXECUTIVE COMPENSATION
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Captured More of
the Addressable
Market

Achieved net asset flows in AUM/A of $58.5 billion, primarily from growth with existing advisors

AUM accounted for 51% of AUM/A net flows

Increased accounts on our platform by 4% to over 19.1 million

Increased AUM/A accounts per advisor by 6% to nearly 75 accounts per advisor
Wealth Platform
Enhancements

Enabled Next Generation Proposal tool at additional client firms (99% now enabled) and fully integrated it into Envestnet | Tamarac, including new proposals and strategy modifications

Built and tested Personal Index Portfolio Builder capability to facilitate construction and implementation of custom direct indexing

Enhanced the support for tax management with tax overlay and transition technology

Updated Envestnet’s enterprise wealth management platform experience, enabling users to easily navigate the platform, customize data sets, and efficiently complete workflows

Completed development work on new client portal and client facing mobile apps

Expanded integrations with external CRM tools
Strengthened our
Ecosystem

Continued integration work with FNZ, a global platform provider in the wealth management sector, which will provide a fully digital, end-to-end custody offering to our clients

Enhanced the integration capabilities with new APIs, embeddable widgets and developer support

Launched Envestnet Retire Complete, providing wealth advisors access to a range of retirement savings resources to help their clients meet their retirement objectives

In 2023, our client service scores reached the mid-60s, showcasing notable improvement
Improved Internal
Automation and
Efficiencies

Reduced our headcount approximately 10% and also reduced compensation-related expenses by over 9%, compared to 2022

Processed 219 million trade orders
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In aggregate these achievements were reflected in our compensation decisions and outcomes in respect of 2023:
Annual incentives were
earned at

100% of target
PSUs that concluded their performance period on December 31, 2023
vested at 27.72% of target
Further details on the goals and achievements are provided in the section “—2023 Compensation Decisions” starting on page 38.
WHAT WE DO AND DON’T DO
Envestnet is committed to responsible executive compensation practices that reflect recognized high corporate governance standards. A summary of our notable practices is provided below.
What We Do What We Don’t Do

Pay-for-performance by aligning a significant portion of NEO compensation with the Company’s overall success and performance

Allocate a significant proportion of each NEOs’ pay in equity-based compensation, with at least half of the equity value in PSUs

Enforce meaningful stock ownership requirements for executives

Maintain and uphold a robust Clawback Policy that exceeds NYSE requirements

Retain the services of an independent compensation consultant to ensure objectivity and fairness

Engage in continuous shareholder outreach to gather feedback and insights

Conduct an annual advisory vote on executive compensation

No single-trigger vesting of equity awards in the event of a change in control

No excise-tax “gross-ups”

No excessive perquisites

No Company contributions to nonqualified or supplemental retirement plans

No option repricing without prior shareholder approval

No hedging activities involving Company’s securities
COMPENSATION DESIGN
GUIDING PRINCIPLES
We strive to create a diverse and inclusive environment as we believe this fosters a culture that attracts and motivates employees to operate at their highest level. We provide employees with competitive, performance-based compensation that encourages the achievement of results that create long-term shareholder value. Our total rewards practices are aligned with the market, consistent with our risk profile and reflective of our solid governance practices. The following principles are the basis for our executive compensation program and align pay with performance and shareholder interests:

Compensation is based on clearly articulated goals and results.

Performance-based rewards are consistent with our long-term business strategy and aligned with long-term shareholder value creation.
COMPENSATION FRAMEWORK
The guiding principles and practices summarized above underpin our compensation framework. The core components of an executive officer’s total compensation comprise base salary, an annual cash incentive awarded under our AIP and an annual equity award. Annual equity award values included in the SCT were approved with reference to prior year performance. The key features of each of these elements are described below.
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EXECUTIVE COMPENSATION
   
Element
CEO
2023 Mix
(1)
Other NEO
2023 Mix
(1)(2)
   
Key Features in 2023
Base Salary
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Reviewed but not necessarily adjusted annually

Level informed by market competitiveness, individual performance and scope of responsibility
Annual Cash
Incentive
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[MISSING IMAGE: pc_annualneo-pn.gif]

Target value set as a percentage of base salary

Earned based on performance relative to pre-set goals

80% based on financial performance, which in 2023 comprised Adjusted Revenue (40%) and Adjusted EBITDA (40%)

20% based on individual/team performance

Payouts capped at 150% of target and subject to our Clawback Policy
Equity
Incentive
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2023 grant value informed by prior year company and individual performance with reference to our AIP scorecard

50% granted as PSUs subject to a three-year performance period and 50% granted as RSUs that vest over a three-year period

PSUs vest subject to pre-set goals, which for 2023 grants comprised relative TSR and Adjusted EBITDA Margin, and payouts are capped at 150% of target

Awards are subject to our Clawback Policy
(1)
Reflects base salary at year end, the 2023 target AIP and the approved value of equity awards made in 2023.
(2)
The non-CEO average comprises of Ms. O’Brien and Mr. D’Arrigo and excludes Mr. Warren.
Our 2023 incentive plans combine complementary performance measures that align with our strategic priorities as follows:
2023 Performance
Measures
Where It Is Used
Why It Is Important
Adjusted Revenue AIP
Measures our top-line results and our ability to grow our customer base and/or relationships
Adjusted EBITDA AIP
Measures our bottom-line results, our ability to increase profitability and our ability to reinvest and generate future returns for shareholders
Individual/Team
Performance
AIP
Enables an assessment of qualitative and quantitative contributions at the individual and team level that are not directly relevant at an enterprise-wide level and/or captured in our financials; these outcomes have a direct impact on our current and future economic results and the success of our organization
Adjusted EBITDA Margin PSUs
Measures our operational efficiency in terms of how revenue and operating expenses move relative to each other as we grow, and ultimately contribute to our profitability
Relative TSR PSUs
Demonstrates our ability to deliver superior returns to our shareholders
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EXECUTIVE COMPENSATION
 
USE OF MARKET DATA
To inform decisions on NEO pay levels and design, the Compensation Committee maintains a defined group of peer companies to reference. During 2023, the Compensation Committee conducted its annual review of the peer group. Two companies were automatically removed as a result of market transactions (Bottomline Technologies and Zendesk), with Axos Financial also removed due to low say-on-pay results and a materially different approach to compensation. Blackbaud was added as an application software company that would provide balance to the peer group given its market capitalization and revenue were positioned at or below the 25th percentile of the resulting peer group. Envestnet was positioned between the 25th and 50th percentiles in terms of revenue and trailing twelve-month market capitalization against both the 2023 and 2024 peer groups.
Former Peers
2024 Compensation Peer Group, Approved in 2023
Consistent Peers
New Peers

Axos Financial, Inc.

Bottomline Technologies Inc.

Zendesk, Inc.

ACI Worldwide, Inc.

AssetMark Financial Holdings, Inc.

Avantax, Inc.(1)

FactSet Research Systems Inc.

Fair Isaac Corporation

Guidewire Software, Inc.

Informatica, Inc.

LPL Financial Holdings, Inc.

MarketAxess Holdings Inc.

Morningstar, Inc.

MSCI Inc.

New Relic, Inc.(1)

Nutanix, Inc.

SEI Investments Company

SS&C Technologies, Inc.

Verint Systems, Inc.

Blackbaud, Inc.
2023 Compensation Peer Group, approved in 2022
(1)
Avantax, Inc. and New Relic were included in the 2023 and 2024 peer groups, but will be removed for future analysis in light of both companies delisting during 2023.
The 2023 Compensation Peer Group was established in 2022 and was used to inform pay decisions that took effect in 2023. The 2024 Compensation Peer Group was established in 2023 and will be used to inform pay decisions that take effect in 2024.
A combination of market data for this group, broader contextual information from compensation surveys for non-CEO roles, and individual considerations collectively inform decisions on executive compensation.
SHAREHOLDER ENGAGEMENT
Envestnet regularly engages with our shareholders to proactively provide a forum to discuss any questions and concerns on topics that may include executive compensation. Discussions throughout 2023 and into 2024 indicate that a majority of shareholders continue to be supportive of our current approach to executive compensation. This observation is demonstrated by sustained high levels of say-on-pay support the company has achieved, with over 95% of votes cast in favor at our 2023 Shareholders Meeting.
In reviewing the executive compensation program, the Compensation Committee considers feedback received during these meetings, any feedback received through other channels (including letters to the Company), as well as the commentary issued by major proxy advisory firms whose advice is utilized by many of our shareholders. This feedback, coupled with the say-on-pay outcome, provides a helpful and rounded external perspective.
Envestnet and the Compensation Committee remains committed to engaging with shareholders on executive compensation practices and plans and implementing changes that are responsive to feedback and enhance alignment of our executive compensation program with our strategic priorities.
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EXECUTIVE COMPENSATION
Further details on our 2023 engagement can be found in the Section entitled “Corporate Governance and Board Matters—Shareholder Engagement.”
2023 COMPENSATION DECISIONS
BASE SALARY
NEO salaries were reviewed for 2023. Ms. O’Brien was the only NEO that received an increase in her base salary following a review that indicated a market adjustment was appropriate and was supported by her performance in the role. This increase was effective May 1, 2023. Mr. Warren’s salary was set in connection with his appointment as CFO.
NEOs
2023 Base Salary
Base Salary Increase
William Crager $ 650,000 %
Joshua Warren $ 425,000 %
Shelly O’Brien $ 400,000 6.7%
Peter D’Arrigo $ 450,000 %
ANNUAL INCENTIVE PROGRAM
AIP measures
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The AIP rewards NEOs based on a combination of Company and individual performance. Financial performance accounts for 80% of the opportunity and in 2023 was assessed based on Adjusted Revenue (40%) and Adjusted EBITDA (40%). The remaining 20% is determined based on an assessment of individual and team performance, which enables measurement against strategic objectives specific to an individual’s role or a team more broadly.
For the grants made in 2024 to our NEOs, the 20% determined based on individual and team performance has been eliminated, and the AIP payment amounts will be based only on financial performance with goals set with respect to free cash flow and revenue less asset-based costs.
NEOs’ 2023 target opportunities were set as a percentage of base salary and ranged from 80% - 100%, informed by market data. The maximum opportunity is capped at 150% of an individual’s target. Threshold performance earns a payout starting at 40% of target. For performance between stated goals, the payout will be calculated based on straight-line interpolation. To determine payments made in 2024 for 2023 performance, the Compensation Committee evaluated Company performance against the following pre-established financial goals.
Measure(1)
Weight
Threshold
Target
Exceeds
Maximum
2023
Actual
2023
Payout
Adjusted Revenue ($M) 40%
1,099
1,204 – 1,264
1,327 1,454 1,246 100%
Adjusted EBITDA ($M) 40%
219
240 – 252
265 290 251 110%
Payout as % of Target
40% - 80%
80% - 110%
125% 150% 105%
(1)
Envestnet utilizes adjusted performance measures in the AIP For details of the reconciliation showing how adjusted values are calculated from our audited financial statements see Appendix A.
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EXECUTIVE COMPENSATION
 
2023 financial performance resulted in a payout factor of 105% of target. The Compensation Committee approved an aggregate payout for current NEOs capped at 100% of target. Messrs. Crager and D’Arrigo’s payments were approved in accordance with their respective Separation and Release Agreements. Mr. Warren’s payment reflected the terms of his Employment Agreement, which provided for a minimum payment equivalent to his pro-rata target amount in respect of 2023 performance.
In aggregate, these achievements resulted in the Compensation Committee approving the following awards in respect of 2023 performance.
NEOs
2023 Target AIP
(% of salary)
2023 Target AIP
2023 Actual AIP
2023 Actual AIP as
a % of Target
William Crager 100% $ 650,000 $ 581,100 (1)%
Joshua Warren 90% $ 94,315 $ 94,315 (2)%
Shelly O’Brien 80% $ 320,000 $ 320,000 100%
Peter D’Arrigo 100% $ 450,000 $ 450,000 (3)%
(1)
In accordance with Mr. Crager’s Separation and Release Agreement, he received an annual incentive based on the average of his AIP awards for 2022 and 2021.
(2)
Mr. Warren’s target AIP opportunity for 2023 was pro-rated in connection with his appointment on October 2, 2023 as a special advisor and subsequent appointment on November 15, 2023 as CFO. Per the terms of his Employment Agreement his 2023 AIP was subject to a minimum payment value of $94,315, equivalent to the pro-rated target.
(3)
In accordance with Mr. D’Arrigo’s Separation and Release Agreement, he received an annual incentive based on his 2023 target of $450,000.
ANNUAL EQUITY INCENTIVE AWARDS
Equity awards are granted annually to eligible employees, including our NEOs, to recognize performance, to align equity participants with the interests of our shareholders and to retain top talent. Long-term equity incentive awards represent a significant portion of NEOs’ total compensation. Awards are made under the Envestnet shareholder-approved equity incentive plan and, for NEOs, are granted in an equal mix of PSUs and RSUs.
Target Equity Mix in 2023
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RSUs vest subject to service over a three-year period, with one-third vesting on the first anniversary of the date of grant, and one-twelfth vesting on each three-month anniversary for the following two years.

PSUs vest subject to service and the achievement of pre-set performance goals over a three-year performance period, subject to a maximum payout factor of 150% of target. Threshold performance results in 50% of the target PSUs vesting, with no payout for performance below threshold. For performance between stated goals, the payout will be calculated based on straight-line interpolation.

Both RSUs and PSUs are subject to our Clawback Policy.
The following equity grants were made in the first quarter of 2023, with the grant value informed by the prior year AIP outcome.
NEOs(1)
2023 Approved
Value
(2)
RSUs Awarded
PSUs Awarded
William Crager $ 3,355,000 26,674 26,674
Shelly O’Brien $ 457,500 3,637 3,637
Peter D’Arrigo $ 1,220,000 9,699 9,699
(1)
Mr. Warren did not receive any equity grants in 2023 given the timing of his appointment. His first equity grant was made in the first quarter of 2024.
(2)
Numbers reflect the value approved by the Committee. The grant date fair value differs slightly due to the price used to calculate the number of RSUs and PSUs to grant and consideration of pre-grant performance in relation to the relative TSR performance measure.
The PSUs will vest in 2026 based on performance relative to two equally-weighted measures.
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EXECUTIVE COMPENSATION
[MISSING IMAGE: pc_psu2023-pn.jpg]

Adjusted EBITDA Margin will assess our success in managing operating expenses to deliver profitable growth for our shareholders, and complements the Adjusted Revenue and Adjusted EBITDA goals included in our 2023 AIP scorecard.

Relative TSR seeks to ensure outcomes align with shareholder interests and the creation of sustainable long-term value.
The Compensation Committee approved the following performance goals in respect of each of these measures.
Measures(1)(2)
Measurement Basis
Weight
Threshold
Target
Maximum
Adjusted EBITDA Margin Final year
50%
23%
25%
27%
Relative TSR vs. Russell 2000 Index constituents Three-year
50%
35th
Percentile
50th
Percentile
75th
Percentile
Payout as % of Target
50%
100%
150%
(1)
Envestnet utilizes adjusted performance measures in the equity plan. For details of the reconciliation showing how adjusted values are calculated from our audited financial statements, see Appendix A.
(2)
The performance period runs from January 1, 2023 to December 31, 2025.
Performance will be assessed in the first quarter of 2026 following the conclusion of the three-year performance period.
For PSUs granted in 2024, if the Company’s TSR is negative during the performance period, the performance percentage based on Relative TSR cannot exceed 100%, regardless of whether the Relative TSR is above the 50th percentile.
SETTLEMENT OF PSUs GRANTED IN 2021
The PSUs granted in February 2021 were subject to a three-year performance period that concluded on December 31, 2023. In February 2024 the Compensation Committee reviewed performance in relation to the established performance goals and approved an overall payout of 27.72% of the target units. See below for further details regarding the outcomes for each individual performance measure.
Measures(1)
Measurement
Basis
Weight
Threshold
Target
Maximum
Actual
Payout
Adjusted Revenue Growth Three-year
compounded
annual growth rate
33.33%
8%
14%
20%
7.64%
0.00%
Adjusted EPS Growth Final year
growth
33.33%
10%
16%
22%
13.98%
83.15%
Relative TSR vs. Russell 2000 Index Constituents Three-year
33.34%
35th
Percentile
50th
Percentile
75th
Percentile
28th
Percentile
0.00%
Payout as % of Target
50%
100%
150%
27.72%
(1)
Envestnet utilizes adjusted performance measures in the equity plan. For details of the reconciliation showing how adjusted values are calculated from our audited financial statements see Appendix A.
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EXECUTIVE COMPENSATION
 
BENEFITS AND PERQUISITES
Envestnet provides limited executive perquisites to our NEOs. In 2023, Mr. Crager received use of an apartment in close proximity to the Company’s headquarters for commuting purposes. Given this was a business need, the Company agreed to cover the additional taxes on the underlying benefit. The NEOs and a select group of senior leaders also have access to a supplementary health and wellness allowance.
The programs noted below are provided to all of our employees, inclusive of the NEOs.
Healthcare
Welfare
Retirement

Health, dental and vision insurance

Health care and dependent care flexible spending accounts

Life and accidental death & dismemberment insurance

Short and long-term disability

401(k) plan, with company match
Additional Benefits

Expanded mental health services and counseling

Education reimbursement and student debt repayment

Additional wellness benefits

Adoption and surrogacy benefits

Parental stipend

College scholarship plan for employees’ children
For more information on our benefits package, see the section above entitled “Environmental, Social and Governance—Supporting Our Employees.”
EXECUTIVE TRANSITIONS
CFO Transition
In September 2023, a transition was announced in relation to the role of CFO. At the request of the Board, Mr. D’Arrigo agreed to step down as CFO effective November 15, 2023 and the Company agreed to pay Mr. D’Arrigo the payments he was entitled to under his employment agreement in connection with a termination without cause. Mr. D’Arrigo agreed to remain as a senior advisor through March 31, 2024 to facilitate a smooth transition and also agreed to general release terms, restrictive covenants and confidentiality obligations. Mr. Warren joined Envestnet effective October 2, 2023 as a senior advisor and was appointed to the role of CFO effective November 15, 2023.
In connection with the aforementioned separation and appointment, the Compensation Committee approved the following key compensation terms.
In respect of Mr. D’Arrigo:

Payment of salary and benefits would continue through March 31, 2024. No equity grants will be made in 2024.

In accordance with his 2016 Employment Agreement, Mr. D’Arrigo will receive (i) cash severance of $1,625,000, equivalent to two-times base salary and the average of his last two annual bonus amounts, payable in equal installments on the Company’s regular payroll dates over a period of 24 months beginning March 31, 2024, (ii) $31,622 in health premium payments, (iii) a lump sum payment equal to $450,000, representing Mr. D’Arrigo’s 2023 non-equity incentive compensation target amount and (iv) a lump sum payment of $89,384, representing a pro-rated portion of Mr. D’Arrigo’s 2024 bonus (based on the average of his 2022 and 2023 bonuses).

Outstanding equity awards will be treated in accordance with the award agreements.

Unvested PSUs (awards made in 2022 and 2023) will be retained, with vesting calculated following the conclusion of the performance period reflecting a pro-rata adjustment for days worked.

Unvested RSUs will continue to vest through March 31, 2024. Any RSUs that haven’t vested by April 1, 2024 will be forfeited.
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EXECUTIVE COMPENSATION

Vested unexercised stock options will remain exercisable for up to six months following March 31, 2024.
In connection with entering into the Separation and Release Agreement, Mr. D’Arrigo agreed to general release terms, restrictive covenants and confidentiality clauses.
In respect of Mr. Warren:

Mr. Warren will receive a base salary of $425,000, subject to annual review.

Mr. Warren will also be eligible for annual discretionary cash bonuses with a target amount equal to 90% of base salary and applicable performance goals determined by the Compensation Committee each year. The cash bonus paid for 2023 was subject to a minimum of $94,315 and subsequently paid at this amount, which was equivalent to his pro-rata target for the year.

Mr. Warren is also eligible for annual grants of long-term equity-linked incentive awards with the amounts and applicable performance goals determined by the Compensation Committee each year. For 2024, the target equity grant value is $1,600,000. Mr. Warren’s 2024 equity grant will be delivered in a combination of PSUs (target value of $900,000 or 56.25% of the overall grant) and RSUs (target value of $700,000 or 43.75% of the overall mix.) No equity grant was made to Mr. Warren in 2023 given the timing of his appointment.

Mr. Warren received a signing cash bonus of $500,000 to attract him to Envestnet at a time when competition for executive-level talent remains challenging. The bonus has a one-year repayment provision in the event of a voluntary termination in his first year.
CEO Transition and Interim CEO Compensation
In January 2024, a transition was announced in relation to the role of CEO. Mr. Crager announced he was stepping down as CEO effective March 31, 2024 and will resign from the Envestnet Board immediately following the 2024 Annual Meeting of Shareholders. Mr. Crager will continue to serve as senior advisor to the company from April 1, 2024 until at least March 31, 2025. Mr. Fox, Chair of our Board, was announced as Interim CEO effective April 1, 2024, serving in an executive capacity effective January 8, 2024 to facilitate a smooth transition.
In connection with the foregoing separation and appointment, the Board approved the following key compensation terms.
In respect of Mr. Crager:

Payment of salary and benefits would continue through March 31, 2024. No equity grants will be made in 2024 and no AIP bonus will be payable in respect of 2024 performance.

No cash severance will be payable.

Unvested PSUs (awards made in 2022 and 2023) will be retained, with vesting calculated following the conclusion of the performance period reflecting a pro-rata adjustment for days worked.

Unvested RSUs will continue to vest through March 31, 2025. Any RSUs that haven’t vested by April 1, 2025 will be forfeited.

Vested unexercised stock options will remain exercisable for up to six months following March 31, 2025.

In connection with entering into the Separation and Release Agreement, Mr. Crager agreed to general release terms, restrictive covenants and confidentiality clauses.
In respect of Mr. Fox while serving as Interim CEO:

A monthly compensation, commencing January 7, 2024, valued at $350,000, with 25% paid in cash on a bi-monthly basis, and the balance to be accrued and granted as restricted shares, subject to a 12-month vesting period at the conclusion of his time as Interim CEO.

Consideration for a discretionary cash bonus based on performance in role.

A one-time award of 5,178 RSUs with a grant value of approximately $250,000.

Continued receipt of compensation as a member of the Board.
For details on Mr. Fox’s 2023 compensation, see the Section entitled “Director Compensation”.
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EXECUTIVE COMPENSATION
 
COMPENSATION GOVERNANCE
ROLE OF THE COMPENSATION COMMITTEE
The Compensation Committee is responsible for overseeing and approving executive compensation programs at Envestnet. At the beginning of each year, the Compensation Committee approves the components of compensation for the NEOs, individual performance goals for the CEO and sets the performance goals for any related compensation programs.
At the end of the year, the Compensation Committee conducts an in-depth review of overall Company results and the CEO’s performance relative to the identified performance goals.
To assist in this process, the CEO provides an overview of the performance of each of the other NEOs to the Compensation Committee and presents his compensation recommendations. CEO and other NEO pay levels are evaluated and approved after an analysis of total compensation for similar positions, consideration of external market conditions and a review of individual performance. While a specific percentile is not targeted, the aggregate impact of pay decisions by role is informed by a competitive range around the 25th percentile and market median, taking into account the aforementioned factors. The Compensation Committee exercises its discretion to revise any recommendations made by the CEO and approves all compensation decisions for the NEOs with the objective of delivering compensation that is aligned with performance results. Compensation decisions for the CEO are made by the Compensation Committee based on a number of relevant factors, including an assessment of Company results and the CEO’s individual performance.
The Compensation Committee has the ability to retain an outside independent advisor to provide an external perspective when discharging its duties. During fiscal 2023, the Committee engaged Willis Towers Watson US LLC (“WTW”) in this capacity, to provide advice and information regarding executive compensation, including the compensation peer group composition, pay levels and practices and incentive design. Aggregate fees paid to WTW for services related to executive compensation for fiscal 2023 were approximately $320,000.
The Compensation Committee annually reviews the independence of WTW in light of SEC and NYSE rules regarding compensation consultant independence and has affirmatively concluded that WTW has no conflicts of interest relating to its engagement by the Compensation Committee.
STOCK OWNERSHIP GUIDELINES
Our NEOs are subject to robust share ownership guidelines, which require them to build up an interest in Envestnet stock over time. We believe that requiring ownership increases the alignment between executives and shareholders, mitigates risk, and encourages executives to act in ways that increase shareholder value sustainably.
Minimum Requirements

CEO: 600% of base salary

Other NEOs: 300% of base salary
Time Horizon

Five years from becoming a NEO
Counted Equity Interests

Shares owned directly by the NEO (including those held as a joint tenant or as tenant in common)

RSUs (vested and unvested)

Stock options that are fully vested and exercisable

Shares owned in a self-directed Individual Retirement Account

Shares owned or held for the benefit of a spouse or minor children
Retention Requirement

NEOs are required to retain all shares acquired through option exercises and other stock awards until their respective ownership requirements are met

Sale of shares is not permitted until the guidelines are met
The Compensation Committee assesses compliance annually, and as of December 31, 2023 all current NEOs were in compliance with these guidelines or progressing towards the required ownership within the applicable time horizon.
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EXECUTIVE COMPENSATION
CLAWBACK POLICY
During 2023, the Compensation Committee amended and restated the existing Clawback Policy as required by the new NYSE listing standards on clawbacks. The Committee determined that it was appropriate to retain the existing policy provisions in the amended and restated policy that provide protections for the Company in the event of certain misconduct of the covered officers that are in addition to the requirements of the new listing standards. The amended and restated policy also adds a section that satisfies the new listing standard requirements, specifically requiring forfeiture or clawback of incentive compensation that is found to have been erroneously awarded, earned or vested in the event of a financial restatement without regard to fault or misconduct of the covered officer. A summary of the key features of the amended and restated Clawback Policy is provided below.
Element
Misconduct Related Provisions
Restatement Related Provisions
Covered
persons

Current and former section 16 officers

Any other officer of the Company designated by the Compensation Committee

Current and former section 16 officers
Triggering
events
A covered person engages in fraud or other intentional misconduct that:

Materially relates to a restatement of our financial statements, or

Results in material financial or reputational harm to the company
An accounting restatement of our financial statements due to material noncompliance with any financial reporting requirement.
Covered compensation
All incentive compensation (cash and equity) that is:

Awarded, earned, vested or settled during or after the fiscal year in which a clawback event occurs, or

Is outstanding during or has a performance period that relates to the fiscal year in which the clawback event occurs
The entire after-tax value of covered compensation is subject to forfeiture or recoupment, at the discretion of the Compensation Committee
All incentive compensation (cash and equity) that is awarded, earned or vested based wholly or in part upon the attainment of a financial reporting measure
The pre-tax value of compensation that is found to have been erroneously awarded based on the restated financials is subject to forfeiture or recoupment in accordance with the Clawback Policy provisions. The clawback of such compensation is mandatory except in certain limited circumstances
A copy of the Clawback Policy can be found attached to Envestnet’s Annual Report on Form 10-K for the year ended December 31, 2023.
COMPENSATION RECOVERY ANALYSIS IN CONJUNCTION WITH FINANCIAL STATEMENT CORRECTION
During the fourth quarter of 2023, Envestnet identified that its arrangement with a third-party for the use of cloud hosted virtual servers that was previously accounted for as a finance lease transaction and included as a component of property and equipment, net in the consolidated balance sheets should have been recognized as a prepayment included within prepaid expenses and other current assets and other assets in the consolidated balance sheets. Envestnet concluded that the classification of these transactions was immaterial in prior period financial statements and that amendment of previously filed reports was not required. However, Envestnet corrected this immaterial error in the prior years reported within its Annual Report on Form 10-K for the year ended December 31, 2023.
With respect to Envestnet’s consolidated statements of operations for the year ended December 31, 2022, the corrections resulted in an increase in direct expense of $2.0 million, an increase in general and administrative expense of $2.7 million and a corresponding decrease in depreciation and amortization expense of $4.7 million.
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The transaction giving rise to the error was entered into in 2022 and thus did not affect fiscal periods prior to the year ended December 31, 2022.
Awards under Envestnet’s incentive plans during the relevant period were based upon various financial, market and non-financial weighted metrics, including four relevant financial and market performance measures: Adjusted Revenue, Adjusted EBITDA, Adjusted EPS and relative TSR. While the correction associated with the accounting error did not directly affect Adjusted Revenue or Adjusted EPS, it did marginally directly affect Adjusted EBITDA. For the one- and three-year periods ending on December 31, 2022, Envestnet’s Adjusted EBITDA did not meet the minimum thresholds for awards under Envestnet’s incentive plans and thus no awards were made in respect of these financial metrics. See “Executive Compensation—2022 Compensation Decisions—Annual Incentive Program” in Envestnet’s proxy statement for its 2023 Annual Meeting of Shareholders in relation to the AIP. The Company’s management confirmed to the Compensation Committee that there was no compensation awarded in respect of 2022 performance. The Company’s management also confirmed to the Compensation Committee that the AIP scorecard which informed awards in respect of 2023 performance was not affected by the correction.
PSU awards granted in February 2020 were subject to a three-year performance period that concluded on December 31, 2022. In February 2023 the Compensation Committee reviewed performance in relation to the established performance goals and approved a payout of 33.9% of target. The Company’s management confirmed to the Compensation Committee that, in connection with determining the appropriate accounting for the error, it had concluded, after consulting with the Company’s independent auditors, that the error was both quantitatively and qualitatively immaterial in that it would not reasonably be expected to impact the judgement of a user of the Company’s financial statements and therefore would not reasonably be expected to impact the relative TSR metric of the PSUs.
In light of the foregoing and after consultation with outside counsel and taking into account other factors that the Compensation Committee considered relevant, the Compensation Committee concluded that recovery of any compensation was not required under the Envestnet Clawback Policy as a result of the financial statement correction discussed above.
TAX CONSIDERATIONS
Section 162(m) of the Internal Revenue Code of 1986, as amended (the “Code”) limits the deductibility of annual compensation in excess of $1 million paid to “covered employees” ​(as defined by the Code) of the Company with some limited exceptions for compensation paid pursuant to certain arrangements in place on November 2, 2017. For 2018 and after, our covered employees generally include anyone who (i) was the CEO or CFO at any time during the year, (ii) was one of the other NEOs who was an executive officer as of the last day of the fiscal year, and (iii) was a covered employee for any previous year after 2016.
As with prior years, although the Compensation Committee will consider deductibility under Section 162(m) with respect to the compensation arrangements for executive officers, deductibility will not be the sole factor used in determining levels or methods of compensation. Since our compensation objectives may not always be consistent with the requirements for full deductibility, we and our subsidiaries may enter into compensation arrangements under which payments would not be deductible under Section 162(m).
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EXECUTIVE COMPENSATION
COMPENSATION COMMITTEE REPORT
The Compensation Committee has reviewed and discussed the Compensation Discussion and Analysis contained in this proxy statement with management and, based on such review and discussion, the Compensation Committee recommended to the Board that the Compensation Discussion and Analysis be included in the Company’s 2023 Annual Report on Form 10-K and in this proxy statement.
Gayle Crowell, Chair
Gregory Smith
Barbara Turner
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
During the year ended December 31, 2023, Mr. Fox, Ms. Crowell and Mr. Smith served on our Compensation Committee. No director who served on the Compensation Committee in fiscal year 2023 is, or has been, employed by us or our subsidiaries or is an employee of any entity for which any of our executive officers serves on the board of directors.
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EXECUTIVE COMPENSATION
 
2023 SUMMARY COMPENSATION TABLE
The following table contains compensation information for our 2023 NEOs. The information included in this table reflects compensation paid to our NEOs for services rendered to us.
Name and Title
Year
Salary
($)
Bonus
($)
(1)
Stock
Awards
($)
(2)(3)
Non-Equity
Incentive Plan
Compensation
($)
(4)
Change in
Nonqualified
Deferred
Compensation
Earnings
($)
(5)
All Other
Compensation
($)
(6)
Total
($)
William Crager
   Chief Executive Officer
2023 650,000 581,100 3,520,568 129,175 4,880,843
2022 646,000 5,751,055 382,200 141,936 6,921,191
2021 600,000 4,769,575 780,000 23,054 6,172,629
Joshua Warren
   Chief Financial Officer
2023 106,250 594,315 700,565
Shelly O’Brien
   Chief Legal Officer, General
   Counsel and Corporate
   Secretary
2023 391,667 480,022 320,000 22,716 1,214,405
2022 374,000 784,228 147,000 21,966 1,327,194
2021 364,993 725,410 288,000 20,369 1,398,772
Peter D’Arrigo
   Former Chief Financial Officer
2023 450,000 450,000 1,280,116 25,126 2,205,242
2022 446,000 2,091,222 275,000 20,326 2,924,584
2021 405,015 1,788,591 540,000 16,354 2,749,960
(1)
Amounts disclosed in the Bonus column relate to bonus payments that were made pursuant to agreements entered into between the Company and the NEOs with amounts listed in the Bonus column in 2023. In accordance with Mr. Crager’s Separation and Release Agreement, he received an annual incentive based on the average of his AIP awards for 2022 and 2021 equal to $581,100. Mr. Warren’s target AIP opportunity for 2023 was pro-rated in connection with his appointment on October 2, 2023 as a special advisor and subsequent appointment on November 15, 2023 as CFO. Per the terms of his Employment Agreement his 2023 AIP was subject to a minimum payment value of $94,315, equivalent to the pro-rated target. Additionally, pursuant to such Employment Agreement, he received a sign-on bonus equal to $500,000. Finally, in accordance with Mr. D’Arrigo’s Separation and Release Agreement, he received an annual incentive based on his 2023 target of $450,000.
(2)
Amounts disclosed in the Stock Awards column relate to grants of RSUs, PSUs, and stock options in the identified year. With respect to each equity grant, the amounts disclosed reflect the full grant date fair value in accordance with FASB ASC Topic 718.
(3)
Amounts shown in this column include the grant date fair values for PSUs at the target payout based on the probable outcome of the performance condition, determined as of the grant date, which for 2023 is for Mr. Crager $1,853,176; for Mr. D’Arrigo $673,831; and for Ms. O’Brien $252,673. The maximum potential values of the 2022 PSUs is 150% of target. For 2023, the PSU maximum value at grant date fair value would be for Mr. Crager $2,779,764; for Mr. D’Arrigo $1,010,746; and for Ms. O’Brien $379,010. Further information regarding the 2023 awards is included in tables below entitled “2023 Grants of Plan-Based Awards Table” and “2023 Outstanding Equity Awards at Fiscal Year-End.”
(4)
Amounts paid under our AIP are disclosed in the Non-Equity Incentive Compensation column. Non-Equity Incentive Compensation payments are based on fiscal performance and are paid in the subsequent fiscal year, generally within the first two months (e.g., the amounts earned for 2023 were paid in February 2024). For more information, see “Executive Compensation—2023 Compensation Decisions—Annual Incentive Program.”
(5)
Only Mr. D’Arrigo has an account balance in a nonqualified deferred compensation plan. No amount is included in this column for Mr. D’Arrigo because his earnings on his deferrals in such plan in 2023, as noted below in the Nonqualified Deferred Compensation Table, would not be considered above-market or preferential earnings.
(6)
For Mr. Crager, the amount disclosed for 2023 reflects $103,796 for his Berwyn apartment, an executive wellness stipend of $15,479 and matching contributions to his 401(k) account in the amount of $9,900; $117,394 for his Berwyn apartment, an executive wellness stipend of $15,392 and matching contributions to his 401(k) account of $9,150 in 2022; an executive wellness stipend of $14,354 and matching contributions to his 401(k) account in the amount of $8,700 in 2021. For Mr. Warren, the amount disclosed reflects no additional compensation in 2023. For Ms. O’Brien, the amount disclosed for 2023 reflects an executive wellness stipend of $12,816 and matching contributions to her 401(k) account in the amount of $9,900; an executive wellness stipend of $12,816 and matching contributions to her 401(k) account of $9,150 in 2022; an executive wellness stipend of $11,669 and matching contributions to her 401(k) account of $8,700 in 2021. For Mr. D’Arrigo, the amount disclosed for 2023 reflects an executive wellness stipend of $15,226 and matching contributions to his 401(k) account of $9,900 in 2023; an executive wellness stipend of $11,212 and matching contributions to his 401(k) account of $9,150 in 2022; an executive wellness stipend of $7,654 and matching contributions to his 401(k) account in the amount of $8,700 in 2021. The value of benefits and payments that are generally available to all employees on a non-discriminatory basis are not included in the amounts disclosed.
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EXECUTIVE COMPENSATION
2023 GRANTS OF PLAN-BASED AWARDS TABLE
The following table contains information concerning grants of plan-based awards made in 2023 to our NEOs.
Name
Grant Date(1)
Estimated Future Payouts
Under Non-Equity Incentive
Plan Awards
(1)
Estimated Future Payouts
Under Equity Incentive
Plan Awards
(2)
All Other Stock
Awards: Number
of Shares of
Stock or Units
(3)
Fair Value of
RSUs and PSUs
on Grant Date
($/Share)
Grant Date Fair
Value of Stock
and Option
Awards
($)
Threshold
($)
Target
($)
Maximum
($)
Threshold
(Shares)
Target
(Shares)
Maximum
(Shares)
William Crager 2/28/2023 260,000 650,000 975,000 13,337 26,674 40,011 69.48 1,853,310
2/28/2023 26,674 62.51 1,667,392
Joshua Warren
Shelly O’Brien 2/28/2023 128,000 320,000 480,000 1,819 3,637 5,456 69.48 252,699
2/28/2023 3,637 62.51 227,349
Peter D’Arrigo 2/28/2023 180,000 450,000 675,000 4,850 9,699 14,549 69.48 673,887
2/28/2023 9,699 62.51 606,284
(1)
On February 28, 2023, the Compensation Committee established the values and performance measures applicable to our 2023 non-equity incentive compensation awards. The actual cash value was paid in 2024 based on financial metrics and individual factors as described in “Compensation Discussion and Analysis—2023 Compensation Decisions—Annual Incentive Program” above. Each of the financial metrics has a threshold target that must be hit in order to receive a minimum payment equal to 40% of the target value. The threshold value listed in the table above assumes that the threshold amount was hit for each of individual financial metrics and individual factors, but it is possible that a lower amount could be paid out for each executive if the threshold targets are not hit for one or more of the financial metrics.
(2)
On February 28, 2023, the Compensation Committee granted PSUs in respect of 2022 performance. The actual number of PSUs that will become vested is based on financial metrics described in “Compensation Discussion and Analysis—2023 Compensation Decisions—2023 Outstanding Equity Awards” above. Each of the financial metrics has a threshold target that must be hit in order to receive a payment equal to 50% of the target value. The threshold value listed in the table above assumes that the threshold amount was hit for each of individual financial metrics, but it is possible that a lower amount could become vested if the threshold targets are not hit for one or more of the financial metrics.
(3)
On February 28, 2023, the Compensation Committee granted RSUs in respect of 2022 performance. All restricted stock units were approved by the Compensation Committee and the Board on their respective grant dates.
NARRATIVE TO 2023 SUMMARY COMPENSATION TABLE AND 2023 GRANTS OF PLAN-BASED AWARDS TABLE
See “Executive Compensation—Compensation Discussion and Analysis” above and “—Equity Incentive Plans” below for a more detailed discussion of the compensation plans pursuant to which the amounts listed under the 2023 Summary Compensation Table and 2023 Grants of Plan-Based Awards Table were paid or awarded, and the criteria on which such payments were based.
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EXECUTIVE COMPENSATION
 
2023 OUTSTANDING EQUITY AWARDS AT FISCAL YEAR-END
The following table lists all outstanding equity awards held by our NEOs as of December 31, 2023:
Option Awards(1)
Stock Awards(2)
Name
Grant
Date
Number of
Securities
Underlying
Unexercised
Options (#)
Exercisable
Number of
Securities
Underlying
Unexercised
Options (#)
Un-exercisable
Option
Exercise
Price ($)
Option
Expiration
Date
Number of
Shares or
Units of
Stock that
have not
Vested (#)
Market
Value of
Shares or
Units of
Stock That
Have Not
Yet Vested ($)
William Crager
2/28/2014 14,100 41.84 2/28/2024
2/27/2015 11,400 53.88 2/27/2025
2/29/2016 5,852 20.51 2/28/2026
3/28/2017 5,733 31.70 3/28/2027
3/11/2021 34,144 1,690,811
3/11/2021 2,846 140,934
2/28/2022 36,755 1,820,108
2/28/2022 15,316 758,448
2/28/2023 13,337 660,448
2/28/2023 13,337 660,448
2/28/2023