Company: ABBV
Filing Date: 2025-03-10
Form Type: PRE 14A
Source: 0001558370-25-002603
Chunk: 31

Company: AbbVie Inc.
Filing Date: 2025-03-10
Form: PRE 14A
Chunk 31
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 levels relative to market benchmarks.

40 | 2025 Proxy Statement

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| ​ | EXECUTIVE COMPENSATION |

COMPENSATION RISK OVERSIGHT The company has established, and the compensation committee endorses, several controls to address and mitigate compensation-related risk, such as employing a diverse set of performance metrics, maintaining robust stock ownership guidelines for its executives and non- employee directors, and retaining broad discretion to recover incentive awards in the event of misconduct that would constitute a material breach of the AbbVie Code of Business Conduct. The company’s clawback policy also requires recoupment of excess compensation in the event earnings are subsequently restated. The committee, in collaboration with its independent compensation consultant, identified no material risks in AbbVie’s compensation programs in 2024. When considering compensation-related risk, the committee is aware of certain risks associated with drug pricing decisions. The committee weighs these, as well as other risks material to the company, when designing AbbVie’s compensation programs. In addition, the committee, comprised entirely of independent directors, has discretion to adjust incentive payments, if needed, including to reflect decisions executives make that may impact AbbVie’s reputation and long-term sustainability. Compensation Plan Elements Three primary components make up AbbVie’s executive pay program: (1) base salary, (2) short-term incentives and (3) long-term incentives. The structure of each component is tailored to serve a specific function and purpose. BASE SALARY The compensation committee sets appropriate levels of base salary to ensure that AbbVie can attract and retain a leadership team that will continue to meet our commitments to customers and patients and sustain long-term profitable growth for our stockholders. Generally, the committee considers the median of the Health Care Peer Group as an initial benchmark, but also references additional information as needed. Specific pay rates are then established for each NEO relative to their market benchmark based on the NEO’s performance, experience, unique skills, internal equity with others at AbbVie, and the company’s operating budget. In 2024, the committee and the Board approved annual base salary adjustments for Mr. Michael and Mr. Gonzalez in connection with their appointments as Chief Executive Officer and Executive Chairman, respectively, as described in the section captioned “2024 Chief Executive Officer Transition.” Due to his anticipated retirement, Mr. Gonzalez is no longer eligible for annual base salary adjustments. SHORT-TERM INCENTIVES AND 2024 RESULTS Annual cash incentives are paid to NEOs through AbbVie’s Performance Incent