FLOWERS FOODS INC filed this DEF 14A on Apr 11, 2023

                      FLOWERS FOODS, INC. | 2023 PROXY STATEMENT

WHAT VOTE IS REQUIRED FOR EACH MATTER TO BE VOTED UPON AT THE ANNUAL MEETING?

HOW WILL BROKER “NON-VOTES” BE TREATED?

Broker “non-votes” will be counted as present in determining whether the quorum requirement is satisfied but will not be included in vote totals and generally will not affect the outcome of the vote. A “non-vote” occurs when a nominee holding shares for a beneficial owner does not vote on a proposal because the nominee has not received instructions from the beneficial owner and does not have discretionary power to vote.

In order for your shares to be voted on all matters presented at the annual meeting, including the election of directors, we urge all shareholders whose shares are held in street name by a bank, broker or other record holder to provide voting instructions to the bank, broker or other record holder.

WILL ANY OTHER BUSINESS BE CONDUCTED AT THE ANNUAL MEETING OR WILL OTHER MATTERS BE VOTED ON?

At this time, the board of directors does not know of any other business to be brought before the annual meeting, but if any other business is properly brought before the annual meeting, the persons named as proxies, Messrs. McMullian and Kinsey and Ms. Tillman, will exercise their judgment in deciding how to vote or otherwise act at the annual meeting with respect to that matter or proposal.

WHERE CAN I FIND THE VOTING RESULTS FROM THE ANNUAL MEETING?

We will report the voting results from the annual meeting on a Current Report on Form 8-K, which we expect to file with the SEC on or before June 1, 2023.

TABLE OF CONTENTS

Proxy Summary

Annual Meeting and Voting Information

Directors and Corporate Governance

Share Ownership

Executive Compensation

Audit Committee Report

Items to be Voted on

Additional Information

Appendices

If you elected to receive your proxy materials by mail, a copy of our 2022 annual report, which includes our Annual Report on Form 10-K and our financial statements for the fiscal year ended December 31, 2022, is included in the mailing of this proxy statement.

The annual report does not form any part of the material for the solicitation of proxies.

CAN I ELECT TO RECEIVE FUTURE NOTICES AND PROXY MATERIALS ELECTRONICALLY?

Yes. If you are a registered shareholder or if you participate in the 401(k) Plan, go to the company’s website, www.flowersfoods.com, and follow the instructions for signing up for electronic delivery of proxy materials. Those shareholders signing up for this service will receive all future proxy materials, including the Notice, proxy statement and annual report electronically. Please contact Brenda Smith, our compliance manager, at [email protected] or (229) 226-9116, if you need assistance.

If you hold your shares in a brokerage account or bank you may also have the opportunity to receive these documents electronically. Please contact your brokerage service, bank or financial advisor to make arrangements for electronic delivery of your proxy materials.

WHO SHOULD I CONTACT IF I HAVE ANY QUESTIONS?

If you have any questions about the annual meeting or your ownership of our common stock, please contact Brenda Smith, our compliance manager, at the above address or by emailing [email protected] or calling (229) 226-9116.

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                      FLOWERS FOODS, INC. | 2023 PROXY STATEMENT

DIRECTORS AND CORPORATE GOVERNANCE

DIRECTORS

The board of directors currently consists of 12 directors whose terms expire at the annual meeting. In accordance with the board’s long-term succession plan, Mr. Griswold will retire upon the expiration of his current term, at which time the size of the board of directors will be reduced to 11. The company would like to express its genuine gratitude for Mr. Griswold’s service to the company and its shareholders.

Based on the recommendation of the nominating/corporate governance committee, the board has nominated 11 current directors for election at the 2023 annual meeting. If elected, each of the director-nominees will serve until the 2024 annual meeting of shareholders or until their successors have been duly elected and qualified.

The following biographies provide information on each of our director-nominees, including principal occupation, business experience, skills and qualifications, and other board service.

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TABLE OF CONTENTS

Proxy Summary

Annual Meeting and Voting Information

Directors and Corporate Governance

Share Ownership

Executive Compensation

Audit Committee Report

Items to be Voted on

Additional Information

Appendices

 

Director Since: 2020   Committees: Compensation and Human Capital Committee; Nominating/Corporate Governance Committee		THOMAS C. CHUBB, III    /    Chairman, Chief Executive Officer and President of Oxford Industries, Inc.   Mr. Chubb brings extensive legal, operational, and branded products knowledge to the board of directors. Mr. Chubb, age 59, has served as chairman, chief executive officer and president of Oxford Industries, Inc. (NYSE), a publicly held, lifestyle apparel company with a brand portfolio that includes Tommy Bahama, Lilly Pulitzer, Johnny Was, Southern Tide, The Beaufort Bonnet Company, and Duck Head, since 2015. During the course of his career with Oxford Industries, which spans more than 30 years, he was named vice president, general counsel, and secretary in 1999; executive vice president in 2004; president in 2009; a member of the board in 2012; and chief executive officer and president in 2013.

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TABLE OF CONTENTS

Proxy Summary

Annual Meeting and Voting Information

Directors and Corporate Governance

Share Ownership

Executive Compensation

Audit Committee Report

Items to be Voted on

Additional Information

Appendices

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                      FLOWERS FOODS, INC. | 2023 PROXY STATEMENT

CORPORATE GOVERNANCE

Overview

We believe that good corporate governance is essential to ensure that the company is effectively managed for the long-term benefit of our shareholders. We routinely review our corporate governance policies and practices in light of the legal and regulatory environment, the policies and practices of other publicly-held companies, and input from investors, governance advisors, and other stakeholders.

You can access the full text of our corporate governance documents, including our Corporate Governance Guidelines, board committee charters, Code of Business Conduct and Ethics for Officers and Members of the Board of Directors, Stock Ownership Guidelines, and Flowers Foods, Inc. Employee Code of Conduct on our website at www.flowersfoods.com by clicking on the “INVESTORS” tab and selecting “CORPORATE GOVERNANCE.” You can also receive a copy of these documents by writing to Flowers Foods, Inc., 1919 Flowers Circle, Thomasville, Georgia 31757, Attention: Compliance Department.

Some highlights of our corporate governance framework include:

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TABLE OF CONTENTS

Proxy Summary

Annual Meeting and Voting Information

Directors and Corporate Governance

Share Ownership

Executive Compensation

Audit Committee Report

Items to be Voted on

Additional Information

Appendices

This year, Mr. Deese notified the board that he will retire from his role as non-executive chairman, effective at the annual meeting. The board of directors subsequently decided to combine the roles of chairman and chief executive officer and elect Mr. McMullian to the role of chairman, effective immediately following the annual meeting and contingent upon Mr. McMullian’s re-election. In making the decision to combine the roles of chairman and chief executive officer, the board considered a variety of factors, including our business needs and strategic priorities, the composition of the board, the independent committee composition and leadership, the meaningful responsibilities of the presiding director, and corporate governance trends in our industry.

At this time, the board believes that it is in the best interests of the company and its shareholders for Mr. McMullian to serve as both chairman, and president and chief executive officer. Combining these roles will enable Mr. McMullian to leverage his strong leadership and deep understanding of the company and its operations to effectively execute our strategic initiatives and serve as a bridge between the board of directors and management.

Pursuant to our corporate governance guidelines, the board of directors established the role of independent presiding director, currently filled by Mr. Griswold. In light of Mr. Griswold’s upcoming retirement, the board elected Mr. Chubb to serve as presiding director, effective immediately following the annual meeting and contingent upon Mr. Chubb’s re-election. As presiding director, Mr. Chubb will have significant authority, including the responsibilities listed above.

With a supermajority of independent directors, committees comprised entirely of independent directors, and an independent presiding director to oversee all meetings of the independent directors, the board of directors believes the new leadership structure best serves the long-term interests of the company and its shareholders by providing an appropriate balance between effective independent oversight and consistent leadership to drive execution of our corporate strategy. The board of directors annually reviews its leadership structure to ensure that it remains the optimal structure for the company and its shareholders.

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                      FLOWERS FOODS, INC. | 2023 PROXY STATEMENT

Director Nomination Process

The nominating/corporate governance committee identifies and considers director candidates recommended by its members and other directors, as well as management and shareholders. A shareholder who wishes to recommend a prospective director-nominee for the committee’s consideration should submit the candidate’s name and qualifications to Flowers Foods, Inc., 1919 Flowers Circle, Thomasville, Georgia 31757, Attention: Chief Legal Counsel. The nominating/corporate governance committee will also consider whether to recommend for nomination any person identified by a shareholder pursuant to the provisions of our bylaws relating to shareholder nominations. Recommendations by shareholders that are made in accordance with these procedures will receive the same consideration given to nominees of the nominating/corporate governance committee.

The nominating/corporate governance committee reviews the appropriate skills, qualifications and experience of each director-nominee. This assessment generally includes a review of the nominee’s judgment, independence, relevant subject matter expertise, integrity, experience with businesses or other organizations of comparable size or industry and any other factors deemed relevant to the current needs of the board of directors, including, among other things, diversity in gender, racial and ethnic background, personal and professional experience, viewpoints, or other demographics. The nominating/corporate governance committee may use the services of a third-party executive search firm to assist it in identifying and evaluating possible director-nominees.

The following matrix summarizes certain diversity attributes of our 11 director-nominees, based on the director-nominees’ self-identification:

Determination of Independence

Pursuant to our corporate governance guidelines, the nominating/corporate governance committee and the board of directors are required to annually review the independence of each director and director-nominee. During this review, transactions and relationships among each director and director-nominee or any member of his or her immediate family and the company are considered, including, among others, all commercial, industrial, banking, consulting, legal, accounting, charitable, and familial relationships and those reported in this proxy statement under the section entitled “Transactions with Management and Others.” In addition, transactions and relationships among directors or director-nominees or their affiliates and members of senior management and their affiliates are examined.

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TABLE OF CONTENTS

Proxy Summary

Annual Meeting and Voting Information

Directors and Corporate Governance

Share Ownership

Executive Compensation

Audit Committee Report

Items to be Voted on

Additional Information

Appendices

The purpose of this annual review is to determine whether each director and director-nominee meets the applicable criteria for independence in accordance with the SEC rules and regulations, NYSE rules and our corporate governance guidelines. Only those directors who meet the applicable criteria for independence and the board of directors affirmatively determines to have no direct or indirect material relationship with the company are considered independent directors.

The nominating/corporate governance committee and the board of directors conducted the required annual independence review in February 2023.

Upon the recommendation of the nominating/corporate governance committee, the board of directors affirmatively determined that a majority of our directors and director-nominees are independent of the company and its management as required by the SEC rules and regulations, NYSE rules and our corporate governance guidelines. Messrs. Deese, Casey, Chubb, Griswold, McFadden, Spear, Thomas and Wood, Dr. Stith and Mses. Lewis and Gass are independent directors and all, with the exception of Mr. Griswold, are independent director-nominees. Mr. McMullian is an inside director because he is currently the president and chief executive officer of the company. In determining the independence of Mr. Deese, the board of directors considered the employment by the company of his family members. Each director and director-nominee abstained from voting on his or her own independence.

The foregoing discussion of director independence is applicable only to service as a member of the board of directors, the compensation and human capital committee and the nominating/corporate governance committee.

Additional guidelines apply to the members of the audit committee under the SEC rules and regulations and NYSE rules.

Risk Management Oversight

The board of directors is actively involved in oversight of risks that could affect the company. This oversight is conducted primarily through the audit committee, as described below and in the audit committee charter, but the full board of directors has retained responsibility for general oversight of risks. Specifically, the board of directors is responsible for overseeing, reviewing and monitoring the company’s overall risks, and each board committee is responsible for the oversight of specific risk areas relevant to its purpose as provided in the committee charters. The overall responsibility of the board of directors and its committees is enabled by an enterprise risk management (“ERM”) model and process implemented by management that is designed to identify, assess, manage, and mitigate risks. The board of directors satisfies this responsibility through full reports by each committee chair regarding the committee’s considerations and actions, as well as through regular reports to the board of directors directly from management responsible for oversight of particular risks within the company. In addition, the compensation and human capital committee, nominating/corporate governance committee and finance committee are responsible for the oversight of specific risks, as described above and in each committee’s charter. The company believes that the board’s leadership structure, discussed in detail above, supports the risk oversight function of the board of directors. Strong independent directors chair the various board committees involved with risk oversight, there is open communication between management and directors regarding material risks, and all directors are actively involved in the risk oversight function.

ESG Oversight

In 2022, the board of directors implemented a new ESG oversight structure. Under this structure, the board of directors retains ultimate oversight of the company’s ESG and Corporate Responsibility-related risks and priorities and delegates to the committees oversight of various ESG-related topics, as reflected in the committee charters.

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                      FLOWERS FOODS, INC. | 2023 PROXY STATEMENT

In connection with our strong founding values, management – at the direction and subject to the oversight of our board of directors and its committees – oversees the prioritization of ESG topics that impact our business and stakeholders and the focus of our Corporate Responsibility strategy and reporting. Recently, we formalized our ESG governance framework to include a ESG Executive Committee and ESG Steering Committee as illustrated below.

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TABLE OF CONTENTS

Proxy Summary

Annual Meeting and Voting Information

Directors and Corporate Governance

Share Ownership

Executive Compensation

Audit Committee Report

Items to be Voted on

Additional Information

Appendices

The Board of Directors and Committees of the Board of Directors

In accordance with the company’s amended and restated bylaws (the “bylaws”), the board of directors has set the number of directors at 12. Mr. Griswold, who has served as a director since 2005, will retire at the annual meeting and will not stand for re-election. Pursuant to the bylaws and action by the board of directors, the size of the board of directors will be set at 11 immediately following the annual meeting.

The board of directors held nine meetings in fiscal 2022, and no incumbent director attended fewer than 75% of the aggregate of:

The board of directors has established four standing committees: an audit committee, a nominating/corporate governance committee, a compensation and human capital committee and a finance committee. The board of directors has adopted a written charter for each of these committees, all of which are available on the company’s website at www.flowersfoods.com.

The following table describes the current committee composition and the number of meetings held during fiscal 2022:

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                      FLOWERS FOODS, INC. | 2023 PROXY STATEMENT

Audit Committee

Under the terms of its charter, the audit committee assists the board of directors in fulfilling its oversight responsibilities with respect to:

The audit committee’s duties and responsibilities include:

The board of directors has determined that all audit committee members serving during 2022 are or were “independent” under the SEC rules and regulations, NYSE rules and our corporate governance guidelines.

The board of directors has also determined that Mr. Spear is an “audit committee financial expert” under Item 407(d)(5) of Regulation S-K of the Securities Act of 1933. Each member of the audit committee is financially literate, knowledgeable and qualified to review financial statements.

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TABLE OF CONTENTS

Proxy Summary

Annual Meeting and Voting Information

Directors and Corporate Governance

Share Ownership

Executive Compensation

Audit Committee Report

Items to be Voted on

Additional Information

Appendices

Nominating/Corporate Governance Committee

Under the terms of its charter, the nominating/corporate governance committee is responsible for considering and making recommendations to the board of directors with regard to the composition and function of the board of directors, and the development and review of our corporate governance guidelines. The nominating/corporate governance committee’s duties and responsibilities include:

The board of directors has determined that all members of the nominating/corporate governance committee are “independent” under the SEC rules and regulations, NYSE rules and our corporate governance guidelines. For information relating to nomination of directors by shareholders, please see “— Director Nomination Process.”

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                      FLOWERS FOODS, INC. | 2023 PROXY STATEMENT

Compensation and Human Capital Committee

Under the terms of its charter, the compensation and human capital committee is responsible for overseeing the review and determination of executive compensation and the company’s human capital management activities. The compensation and human capital committee’s duties and responsibilities include:

In February 2023, the compensation and human capital committee completed its annual review of our compensation philosophies and practices with respect to our employees and concluded that the risks arising from such policies and practices are not reasonably likely to have a material adverse effect on us. While risk is inherent in any strategy for growth, the company’s compensation programs minimize risk through the following design elements, among others:

The board of directors has determined that all members of the compensation and human capital committee are “independent” under SEC rules and regulations, NYSE rules and our corporate governance guidelines.

The compensation and human capital committee may delegate all or a portion of its duties and responsibilities to a subcommittee comprised of at least two compensation and human capital committee members, subject to applicable law and the company’s governing documents. The compensation and human capital committee may authorize one or more officers of the company to designate employees to receive awards under the company’s 2014 Omnibus Equity and Incentive Compensation Plan (the “Omnibus Plan”) and to determine the size of such awards, subject to the limitations set forth in the Omnibus Plan. For information regarding the role of executive officers and the compensation and human capital committee’s independent compensation consultant in determining or recommending the amount or form of executive compensation, see “Executive Compensation – Compensation Discussion and Analysis.”

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TABLE OF CONTENTS

Proxy Summary

Annual Meeting and Voting Information

Directors and Corporate Governance

Share Ownership

Executive Compensation

Audit Committee Report

Items to be Voted on

Additional Information

Appendices

Finance Committee

Under the terms of its charter, the finance committee reviews and makes recommendations with respect to financial matters affecting the company. The finance committee’s duties and responsibilities include:

– leverage and debt service/cash flow;

– access to capital;

– deployment of capital;

– mergers and acquisitions;

– benefit plan funding and multi-employer pension plan funding;

– use of derivatives, including for commodity and foreign currency exchange;

– global procurement and interruption of supply chain;

– volatility of inventory because of inflation or deflation; and

– energy availability and cost, including unstable fuel costs.

Relationships Among Certain Directors

W. Jameson McFadden is the nephew of C. Martin Wood III.

Attendance at Annual Meetings

In accordance with our corporate governance guidelines, directors are expected to adequately prepare for, attend and participate in all meetings of the board of directors and meetings of the committees on which they serve and to attend the company’s annual meeting of shareholders. All of our directors, except Terry S. Thomas, attended the annual meeting of shareholders held virtually on May 26, 2022.

Communicating With the Board

The board of directors will give proper attention to written communications that are submitted by shareholders and other interested parties and will respond if appropriate. Shareholders and other interested parties interested in communicating directly with the board of directors as a group, the independent, non-management directors as a group or any individual director may do so by writing to Flowers Foods, Inc., 1919 Flowers Circle, Thomasville, GA 31757, Attention: Presiding Director. Absent circumstances contemplated by committee charters, the chair of the nominating/corporate governance committee and the presiding director, with the assistance of our chief legal counsel, will monitor and review all correspondence from shareholders and other interested parties and provide copies or summaries of such communications to other directors as they deem appropriate.

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                      FLOWERS FOODS, INC. | 2023 PROXY STATEMENT

Transactions with Management and Others

Chris Mulford, the son-in-law of George E. Deese, the non-executive chairman of the board of directors, was employed by the company throughout fiscal 2022 as a general manager of a bakery. In fiscal 2022, he was paid an aggregate salary and cash bonus and received vested time-based restricted stock units for total compensation of $304,034. Mr. Mulford is not an executive officer of the company.

Additionally, Margaret Ann Marsh, the daughter of Robert Benton, an executive officer, was employed by the company throughout fiscal 2022 as the Vice President of Sustainability and Environmental. In fiscal 2022, she was paid an aggregate salary and cash bonus and received vested time-based restricted stock units for total compensation of $281,925. Ms. Marsh is not an executive officer of the company.

Robinson Stubley, the son-in-law of R. Steve Kinsey, was employed by the company throughout fiscal 2022 as Associate Counsel. In fiscal 2022, he was paid an aggregate salary and cash bonus for total compensation of $145,647. Mr. Stubley is not an executive officer of the company.

Any transaction between the company and a related party is disclosed to the nominating/corporate governance committee and then presented to the full board of directors for evaluation and approval. The company’s policies with respect to related party transactions, and any other conflicts of interest, are set forth in our code of business conduct and ethics. Any situation that involves, or may reasonably be expected to involve, a conflict of interest between an executive officer and the company should be disclosed promptly to the chief legal counsel. Any situation that involves, or may reasonably be expected to involve, a conflict of interest between a director and the company should be disclosed promptly to the chairman of the board of directors. The chief legal counsel or chairman of the board of directors, as applicable, will discuss such matters with the nominating/corporate governance committee for evaluation and appropriate resolution, which may include the requested resignation of the director or executive officer.

Each of the transactions set forth above were reviewed and approved by the full board of directors in accordance with the company’s policies.

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TABLE OF CONTENTS

Proxy Summary

Annual Meeting and Voting Information

Directors and Corporate Governance

Share Ownership

Executive Compensation

Audit Committee Report

Items to be Voted on

Additional Information

Appendices

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