KINGSPORT — Eastman Board Chair and CEO Mark Costa’s total compensation moved about a million dollars lower in 2020, according to the company’s annual proxy statement.
Costa has served in the company’s top leadership role since 2014.
Costa’s total 2020 compensation of $13.5 million included $1.3 million in base salary and about $8 million in stock awards. His total compensation in 2019 was $14.5 million.
Costa met overall financial and business performance goals, partially met goals in growth and innovation, exceeded organizational capabilities enhancement goals, and met employee safety and wellness goals, the proxy statement noted.
Eastman’s executive compensation was measured against 18 companies, including Air Products, Goodyear Tire and Rubber Co., Ball Corp. and the Sherwin Williams Co.
Eastman, the proxy statement said, successfully exceeded a goal of delivering more than $1 billion in free cash flow (cash provided by operating activities less net capital expenditures) for the fourth consecutive year.
“This performance delivered 128% conversion of free cash flow to adjusted net income, which was well above most other peer chemical companies,” the statement said. “(The company) reduced net debt (total borrowing less cash and cash equivalents) by $524 million in 2020, including repaying $650 million borrowings made in early 2020 to shore up liquidity to weather COVID-19 uncertainties. We achieved record fourth quarter adjusted earnings per share and resilient full year earnings.”
Temporary and structural cost actions reduced expenses by approximately $150 million for the year, partially offsetting higher costs resulting from lower capacity utilization and inventory reduction as part of prioritization of cash generation as a result of COVID-19.
Eastman implemented changes to its operations and business practices to follow U.S. Centers for Disease Control COVID-19 guidelines and minimize physical interaction, including using technology to allow employees to work from home when possible and altering production procedures and schedules.
The company also delayed salary increases in 2020 for all non-operations employees, including executives, until the end of the year.
The company’s biggest stockholder is the Pennsylvania-based Vanguard Group, with 14.7 million shares with a 10.82% ownership stake.
Eastman is a global specialty materials company that produces a broad range of products found in items people use every day.
With a robust portfolio of specialty businesses, Eastman works with customers in attractive end-markets such as transportation, building and construction, and consumables to deliver innovative products and solutions with commitment to safety and sustainability.
As a globally inclusive and diverse company, Eastman employs approximately 14,500 people around the world and serves customers in more than 100 countries.
The company had 2020 revenues of approximately $8.5 billion and is headquartered in Kingsport.