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INTEL CORPORATION

 

 

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intel. 2021 Proxy Statement Notice of Annual Stockholders’ Meeting

Letter From Your Chairman

 

Dear Stockholder,

 

 

		2021 PROXY STATEMENT  |  Letter From Your Chairman		3

Letter From Your Chairman Continued

 

 

 

4		Letter From Your Chairman  |  2021 PROXY STATEMENT

Letter From Your Chairman Continued

 

 

		2021 PROXY STATEMENT  |  Letter From Your Chairman		5

Intel Corporation Notice of 2021 Annual Stockholders’ Meeting

 

Date		Time		Record Date
Thursday, May 13, 2021		8:30 A.M. Pacific Time		March 19, 2021

 

 

 

Management Proposals				Voting Recommendation of the Board
1.		Election of the nine director nominees named in this proxy statement		FOR EACH DIRECTOR NOMINEE
2.		Ratification of selection of Ernst & Young LLP as our independent registered public accounting firm for 2021		FOR
3.		Advisory vote to approve executive compensation of our listed officers		FOR
Stockholder Proposals
4.		Stockholder proposal on whether to allow stockholders to act by written consent, if properly presented at the meeting		AGAINST
5.		Stockholder proposal requesting a report on median pay gaps across race and gender, if properly presented at the meeting		AGAINST
6.		Stockholder proposal requesting a report on whether written policies or unwritten norms at the company reinforce racism in company culture, if properly presented at the meeting		AGAINST

IMPORTANT NOTICE REGARDING THE INTERNET AVAILABILITY OF PROXY MATERIALS FOR THE ANNUAL MEETING TO BE HELD MAY 13, 2021: THE NOTICE OF 2021 ANNUAL STOCKHOLDERS’ MEETING AND PROXY STATEMENT AND THE 2020 ANNUAL REPORT ON FORM 10-K ARE AVAILABLE AT WWW.INTC.COM

 

6		Intel Corporation Notice of 2021 Annual Stockholders’ Meeting  |  2021 PROXY STATEMENT

Table of Contents

 

 

		2021 PROXY STATEMENT  |  Table of Contents		7

 

Intel put the Silicon in Silicon Valley, and today our technology remains at the core of the most exciting, life-changing innovations on the planet

We are an industry leader, creating world-changing technology that enables global progress and enriches lives. We stand at the brink of several technology inflections—AI, 5G network transformation, and the rise of the intelligent edge¹—that together will shape the future of technology. Silicon and software drive these inflections, and Intel is at the heart of it all with data emerging as a transformational force in this era where an explosion of devices permeates all our interactions. That data must be moved, stored, and processed faster and more securely than ever before. We are unleashing the potential of data to unlock value for people, business, and society on a global scale.

With a clear, shared purpose, we are inspired to create, innovate, and push the boundaries of technology. Our commitment to corporate responsibility and to creating an inclusive environment for our amazing people supports of belonging, Intel can be more innovative, agile, and competitive.

 

 

1	Intel’s definition is included in “Key Terms” within the Financial Statements and Supplemental Details in our Annual Report on Form 10-K.

 

 

8		Proxy Statement Highlights: Introduction to Business  |  2021 PROXY STATEMENT

A Year in Review†

 

We achieved record revenue of $77.9 billion, with 49% from our data-centric businesses, amid the effects of the COVID-19 pandemic. The dynamic of work and learn from home resulted in strong demand for notebook PCs, while demand for desktop PCs weakened. Demand in the DCG cloud service providers market segment grew, while enterprise and government declined on macroeconomic weakness. We shipped a higher volume of 10nm products than we had anticipated at the beginning of the year. The increased mix of 10nm, combined with a higher portion of revenue from lower margin adjacent businesses, offset higher platform revenue and drove a decline in gross margin of 3 percentage points. We invested $13.6 billion in R&D, reduced our spending to 25.3% of revenue, and signed an agreement to divest our NAND memory business. We made capital investments of $14.3 billion, and generated $35.4 billion cash from operations and $21.1 billion of free cash flow. We also returned $19.8 billion to stockholders, including $5.6 billion in dividends and $14.2 billion in buybacks.
		“We achieved record revenue for the fifth consecutive year and maintained a strong balance sheet and liquidity position. Our results amid the challenges of a global pandemic and an uncertain economy reflect the importance of our technology and the resilience of our employees around the world.”   —George Davis Chief Financial Officer

 

Revenue

Operating Income

Diluted EPS

Cash Flows

∎ PC-centric $B ∎ Data-centric $B

∎ GAAP $B             ∎ Non-GAAP $B

∎ GAAP             ∎ Non-GAAP

∎ Operating Cash Flow $B ∎ Free Cash Flow1 $B

 

$77.9B   GAAP

$23.7B   GAAP

$25.3B   non-GAAP1

$4.94   GAAP

$5.30   non-GAAP1

$35.4B   GAAP

$21.1B   non-GAAP1

Revenue up 8% from 2019; Data-centric up 9% and PC-centric up 8%

Operating income up $1.6B or 7% from 2019; 2020 operating margin at 30%

Operating income up $1.5B or 6% from 2019; 2020 operating margin at 32%

Diluted EPS up $0.23 or 5% from 2019

Diluted EPS up $0.43 or 9% from 2019

Operating cash flow up $2.2B or 7%; operating cash flow to net income at 169%

Free cash flow up $4.2B or 25%; free cash flow to non-GAAP net income at 94%

 

Strong demand in notebook PCs and DCG cloud and communications market segments, and NAND pricing recovery, partially offset by weakened demand in desktop PCs and lower platform2 ASPs		Higher gross margin dollars driven by higher platform unit sales, NAND pricing recovery, and improved NAND unit cost, partially offset by higher platform unit cost with increased 10nm product mix, and lower platform ASPs		Higher gross margin dollars, lower shares outstanding, and equity investment gains, partially offset by higher effective tax rate		Working capital changes driven by accounts receivable, inventory and income taxes offset by other assets and liabilities; free cash flow up due to higher operating cash flow and lower capital spending

 

Goal (2019 - 2021)3

Goal (2019 - 2021)3

Goal (2019 - 2021)3

Goal (2019 - 2021)3

Low single-digit growth over the next three years to $76B-$78B; data-centric businesses high single-digit growth and PC-centric business approximately flat to slightly down

Keep non-GAAP operating margin roughly flat at approximately 32% over the next three years

Grow non-GAAP diluted EPS in line with revenue over the next three years

Achieve free cash flow of approximately 80% of non-GAAP net income by 2021

Progress

Progress

Progress

Progress

Revenue grew 8% from 2019 to 2020, to $77.9B

Non-GAAP operating margin was 32% in 2020

Non-GAAP diluted EPS grew 9% from 2019 to 2020; revenue grew 8% over the same period

Free cash flow in 2020 was 94% of non-GAAP net income

 

†	This section is reproduced from our 2020 Annual Report on Form 10-K and speaks as of January 22, 2021.

1	See “Non-GAAP Financial Measures” within MD&A in our 2020 Annual Report on Form 10-K.

2	See “Our Products” within MD&A in our 2020 Annual Report on Form 10-K .

3	2019-2021 goals were announced during the May 2019 Investor Meeting.

 

		2021 PROXY STATEMENT  |   Proxy Statement Highlights: A Year in Review		9

Business Overview†

 

COVID-19 Response

The COVID-19 pandemic has changed the lives of our employees, our customers, and our community. We are proud of how our team has responded, showing resilience, innovating in real time, and demonstrating the tremendous value of our worldwide manufacturing network to customers and partners around the world. Additionally, we launched our Pandemic Response Technology Initiative, which supports essential workers, hard-hit businesses, and students of all ages with Intel-funded projects led by employees along with our global customers and partners. We have learned vital lessons about the critical role technology can play, and has played, in so many areas during the pandemic—from healthcare and telehealth, to remote learning, to innovative technology solutions to help businesses safely reopen. Most importantly, as a company, we have learned to operate with more empathy, agility, and velocity. We look at our products not for what we know they can do, but for what they might be able to do in a changed world.

 

Data-Centric Businesses Expand with New Opportunities				PC-Centric Business Innovates
Data-centric portfolio for 5G network infrastructure   We introduced a broad, data-centric portfolio for 5G network infrastructure, including the Intel® Atom® P5900, our first Intel® architecture-based 10nm SoC for wireless base stations; a next-generation structured ASIC for 5G network acceleration; new 2nd Gen Intel® Xeon® Scalable processors; and the Intel® Ethernet 700 Series Network Adapter with hardware-enhanced Precision Time Protocol, the first 5G network-optimized Ethernet NIC.				11th Gen Intel® Core™ processors   We launched our new processor family for laptops, 11th Gen Intel Core processors with Intel® Iris® Xe graphics leveraging our new 10nm SuperFin process technology. The 11th Gen Intel Core processors optimize power efficiency with leading performance and responsiveness while running at significantly higher frequencies versus prior generations.
Ice Lake server processors   We are now shipping the 10nm-based 3rd Gen Intel Xeon Scalable processors (previously referred to as Ice Lake), which include several architectural, process technology, and platform innovations for performance, security, and operational efficiency. Moovit acquisition We acquired Moovit for $915 million to accelerate Mobileye’s MaaS offering. Moovit is known for its urban mobility application and brings Mobileye closer to achieving our plan to become a complete mobility provider, including robotaxi services.   Planned divestiture of NAND memory business   We signed an agreement with SK hynix Inc. (SK hynix), to divest our NAND memory business, including our NAND memory fabrication facility in Dalian, China and certain related equipment and tangible assets (Fab Assets), our NAND SSD business (NAND SSD Business), and our NAND memory technology and manufacturing business (NAND OpCo Business).				Intel® Evo™ platforms   We introduced the Intel Evo platform brand for designs based on 11th Gen Intel Core processors with Intel Iris Xe graphics. Devices with the Intel Evo platform brand are verified, measured, and tested and key experience indicators as part of the next edition of our laptop innovation program, Project Athena.

xPU era with oneAPI and discrete GPUs

We launched discrete GPUs, including the Intel^® Iris^® X^e MAX GPU for laptops and the first discrete Intel^® Server GPU. These are milestone additions to our expanding portfolio of xPUs. We also announced the Gold release of Intel^® oneAPI Toolkits, supporting Intel CPUs, GPUs, and FPGAs, which are now available for local installation and for Intel^® DevCloud. We are expanding the Intel DevCloud to support the new Intel Iris X^e GPU hardware, including Intel Iris X^e MAX GPU for public access and Intel Iris X^e-HP for select developers.

7nm-based CPU products

We announced in July that our 7nm-based CPU product timing would be delayed and that the primary driver was the yield of our 7nm manufacturing process. We will continue to invest in our future process technology roadmap and advanced packaging technologies to differentiate our products, provide manufacturing optionality and deliver a predictable cadence of leadership products to our customers.

 

2030 RISE Strategy and Corporate Responsibility Goals
		We created our RISE strategy and established our 2030 corporate responsibility goals (2030 goals), through which we aim to leverage our leadership position in the global technology ecosystem to create a more responsible, inclusive, and sustainable world, enabled through our technology and the expertise and passion of our employees.   Our RISE strategy and 2030 goals are deeply rooted in our corporate purpose and aligned with our business strategy to enable us to create value for our customers, investors, employees, and other stakeholders over the next decade and beyond.

 

†	This section is reproduced from our 2020 Annual Report on Form 10-K and speaks as of January 22, 2021.

 

10		Proxy Statement Highlights: Business Overview  |  2021 PROXY STATEMENT

Our Strategy†

 

Our strategy is to play a larger role in our customers’ success by delivering a predictable cadence of leadership products.

The world is changing and driving the need for exponentially more computing. First we experienced the PC era, followed by the mobile and cloud era. We are now entering the era of distributed intelligence, where computing is pervasive and so many things in our lives—our homes, our cars, our hospitals, and our cities—now function like computers. In this world of distributed intelligence, our three fastest growing opportunities are AI, 5G network transformation, and the intelligent and autonomous edge.

We have a history of transforming to capitalize on market shifts, and we are in the midst of another significant transformation to position ourselves and our customers for growth. With our focus on execution and re-energized culture as a force multiplier, we are transforming from a CPU to a multi-architecture xPU company, from silicon to platforms, and from a traditional IDM to a new, modern IDM. Our priorities are to strengthen our core, extend our reach, and redefine our position in the industry. Our capital provides a foundation to invest in our growth and to supplement and strengthen our capabilities. We are thoughtfully deploying capital and focusing our investment in differentiated technologies where we can play a bigger role in the success of our customers and deliver attractive returns to our stockholders.

Our Priorities

 

 

Improve Execution to Strengthen Our Core   We have made changes that help position us to sharpen our operational excellence and process technology. We have streamlined our product roadmaps, evolved our technical organization to drive greater transparency and accountability, and exited businesses to enable focus on our core strategy.		Extend Our Reach to Accelerate Our Growth   Diverse product portfolio to capitalize on the fastest growing opportunities. The proliferation of data analytics, edge computing, and AI is driving a diverse and expanding range of computing applications from edge to cloud. In response, we are innovating to deliver products including a mix of scalar, vector, matrix, and spatial architectures deployed in CPUs, GPUs, accelerators, and FPGAs—unified by an open, industry-standard programming model, oneAPI, to simplify application development.				Redefine Our Position in the Industry   Solve our customers’ problems through solutions and platforms. We are expanding beyond the CPU to better solve our customers’ problems, and not just deliver parts of the solution. With our xPU portfolio, platform vision, IDM capabilities, and scale, we are able to help our customers tackle their own opportunities. We announced the Intel Evo platform brand powered by 11th Gen Intel Core processors with Intel Iris Xe graphics, representing laptop designs supported by Intel’s Project Athena innovation program. In addition, we acquired Moovit to accelerate Mobileye’s transformation to a full-stack MaaS provider that can provide hardware, software, sensors, integration, and large-scale services. We are actively evaluating opportunities in software, services, and solutions, in AI, network transformation, and intelligent edge.

 

†	This section is reproduced in part from our 2020 Annual Report on Form 10-K and speaks as of January 22, 2021.

 

		2021 PROXY STATEMENT  |  Proxy Statement Highlights: Our Strategy		11

Our Capital†

 

We deploy various forms of capital to execute our strategy in a way that seeks to reflect our corporate values, help our customers succeed, and create value for our stakeholders.

 

Capital		Strategy		Value
Financial		Leverage financial capital to invest in ourselves and grow our capabilities, supplement and strengthen our capabilities through acquisitions and strategic investments, and provide returns to stockholders.		We strategically invest financial capital to create long-term value and provide returns to our stockholders in the form of dividends and buybacks.
Intellectual		Invest significantly in R&D and IP to enable us to deliver a predictable cadence of leadership products that move, store, and process data at scale, and extend our reach to accelerate our growth.		We develop IP to enable next-generation products, create synergies across our businesses, expand into new markets, and establish and support our brands.
Manufacturing		Invest timely and at a level sufficient to meet customer demand for current technologies and prepare for future technologies as we evolve our IDM model.		Our manufacturing scope and scale enable us to provide our customers and consumers with a broad range of leading-edge products.
Human		Continue to build a diverse, inclusive, and safe work environment to attract, develop, and retain the talent needed to remain at the forefront of innovation.		Our talented employees enable the development of solutions and enhance the intellectual and manufacturing capital critical to helping our customers win the technology inflections of the future.
Social and Relationship		Build trusted relationships for both Intel and our stakeholders, including employees, suppliers, customers, local communities, and governments.		We collaborate with stakeholders on programs to empower underserved communities through education and technology, and on initiatives to advance accountability and capabilities across our global supply chain, including accountability for the respect of human rights.
Natural		Continually strive to reduce our environmental footprint through efficient and responsible use of natural resources and materials used to create our products.		Our proactive efforts help us mitigate climate and water impacts, achieve efficiencies, and lower costs, and position us to respond to the expectations of our stakeholders.

 

Value We Create   Each of our six forms of capital plays a critical role in our long-term value creation. We consider numerous indicators in determining the success of our capital deployment in creating value. Highlights of value created in 2020 are as follows:   † This section is reproduced from our 2020 Annual Report on Form 10-K and speaks as of January 22, 2021.   2  See “Non-GAAP Financial Measures” within Appendix A.

 

 

12		Proxy Statement Highlights: Our Capital  |  2021 PROXY STATEMENT

Overview of the Board

 

For the 2021 Annual Stockholders’ Meeting, our Board recommends the following nine director nominees listed below. Our Board considers numerous factors when assessing the qualifications for each Board nominee, such as skills and experience relevant and integral to our future strategic direction; independence; understanding of and experience in manufacturing, technology, finance, and marketing; senior leadership experience; international experience; mix of ages; and gender, racial, geographic, and ethnic diversity. In this regard, our Board is committed to actively seeking women and minority director candidates for consideration.

 

Independent Director Nominees
Omar Ishrak Age: 65 Director Since: 2017 Independent Chairman		James J. Goetz Age: 55 Director Since: 2019		Alyssa Henry Age: 50 Director Since: 2020		Risa Lavizzo-Mourey Age: 66 Director Since: 2018		Tsu-Jae King Liu Age: 57 Director Since: 2016
		Gregory D. Smith Age: 54 Director Since: 2017		Dion J. Weisler Age: 53 Director Since: 2020		Frank D. Yeary Age: 57 Director Since: 2009

 

Non-Independent Director Nominee
Patrick P. Gelsinger Age: 60 Director Since: 2021 Chief Executive Officer
				33% of Director Nominees are Women		33% of Director Nominees are Ethnically Diverse		3.4 YRS Average Tenure of Director Nominees

 

		2021 PROXY STATEMENT  |  Proxy Statement Highlights: Overview of the Board		13

Board Responsiveness to Investors in 2020

 

Our relationship with our stockholders is an important part of our company’s success and we have a long tradition of engaging with our stockholders and obtaining their perspectives. Following a disappointing “say on pay” vote in 2020, which received approximately 49.7% support, we undertook extensive engagement efforts to better understand the reasons for how our investors voted, as well as to obtain their views on other key corporate governance and disclosure matters, and to determine how best to respond.

 

Who we met with				50.4%						39.5%						29.7%
				of shares contacted for engagement						of shares engaged with overall						of shares engaged by Chairman of the Board

An integrated outreach team

Independent Chairman (select meetings)

+

Corporate Secretary Office

+

Human Resources Office

+

Corporate Responsibility Office

+

Investor Relations

What we discussed

Our business

Our ESG practices

>35

Strategy execution Cultural transformation Financial performance COVID-19 response

Executive pay programs    Board composition    Human capital management    Environmental & social issues

Separate investor meetings throughout the year

How we responded				Board composition				See page 26
				Added new directors with experience aligned with our strategic transformation
				Executive compensation				See page 65
				Increased Annual Cash Bonus Plan rigor; beginning 2021, financial metrics in the Annual Cash Bonus Plan will be revenue and net income, with payouts based on pre-established threshold/target/max levels
				Provided enhanced disclosure of our One Intel operational goals in the Annual Cash Bonus Plan, as well as the Compensation Committee’s rationale for maintaining our PSUs’ relative TSR metric based on the S&P 500 IT Index
				Provided an update on how the 2019 Strategic Growth Equity Awards are tracking
				Environmental and social				See page 79
				Incorporated specific carbon emissions, water use, and workforce D&I goals into bonus program

Where to Find More Information

See “Investor Engagement” on page 40 and “Investor Engagement and the 2020 ‘Say on Pay’ Vote” on page 70

 

14		Proxy Statement Highlights: Board Responsiveness to Investors in 2020  |  2021 PROXY STATEMENT

Executive Compensation Summary

 

Intel’s executive compensation programs are designed to incentivize the implementation of our growth strategy. There are three key drivers of our executive compensation programs: a competitive pay positioning strategy, a heavy emphasis on incentive-driven pay, and goals that are appropriately aligned with our business strategy (in terms of both selection and attainability). Our executive compensation programs focus on different performance metrics for the different performance periods to balance the incentives.

Our executive compensation programs continue to be tied to the company’s financial and operational performance, support our commitment to good compensation governance, and provide market-based opportunities to attract, retain, and motivate our executives in an intensely competitive market for qualified talent.

Overview of Listed Officer Total Direct Compensation for 2020

 

 

 

Pay Element

Purpose

Performance   Period

Performance Metrics

2020 Decisions / Results

Base Salary

Designed to be market-competitive and attract and retain talent

Annual

—

§  No changes to listed officers’ base salary in 2020

Annual Cash Bonus

Incentivize achievement of Intel’s near-term financial and operational objectives, consistent with Intel’s longer-term goals

Annual

§  YoY net income growth (1/3)   §  Relative net income growth vs. tech peers (1/3)   §  One Intel operational goals (1/3)

§  No changes to annual incentive cash target opportunities   §  Financial performance accounted for 66% of bonus potential—up from 50% in prior years   §  Payout of 100.7% of target vs. 104-114% for 2019

Quarterly Cash Bonus

Company-wide program that rewards quarterly profitability based on Intel’s net income relative to company compensation costs

Quarter

§  Net income relative to company compensation costs

§  No changes to quarterly cash bonus program   §  Annual payout of 23.2 extra days of compensation vs. 24.6 in 2019

Restricted Stock Units

Facilitates stock ownership, executive retention, and stockholder alignment

Three   years with   quarterly   vesting

§  Stock price appreciation

§  Represents 20% of target long-term incentive award opportunity   §  No increase in target value from 2019 other than in connection with promotions

Performance Stock Units

Designed to reward long-term profitability and long-term performance relative to peers; to create and alignment with stockholders; and to facilitate executive retention

Three   years

§  Relative TSR vs. S&P 500 IT Index (50%)   §  Cumulative EPS growth compared to a target established at the beginning of the three-year performance period (50%)

§  Represents 80% of target long-term incentive award opportunity   §  No increase in target value from 2019 other than in connection with promotions   §  No change in performance metrics or payout opportunity (0-200% of target) from 2019   §  For max payout, TSR must exceed index by 25+ percentage points   §  EPS target set to be challenging; factors in planned share buybacks

2021 CEO Transition

 

In early 2021, the Board of Directors implemented a leadership transition, appointing Mr. Gelsinger as CEO effective February 15, 2021, at which time he also joined the Board. The Board determined that this was the right time to change company leadership in order to draw on Mr. Gelsinger’s deep technology and engineering expertise during this critical period of transformation at Intel, and to further enhance the company’s ability to attract top-tier engineering talent. Mr. Gelsinger is a former long-term Intel executive and a highly respected technology industry veteran with a distinguished track record of innovation and talent development. He spent the past eight years successfully leading VMware, Inc., another large technology company, where annual revenues nearly tripled and stock price and market capitalization reached all-time highs during his tenure.

For more information regarding compensation decisions related to Intel’s CEO Transition, please see the “Compensation Discussion & Analysis” on page 65.

 

		2021 PROXY STATEMENT  |  Proxy Statement Highlights: Executive Compensation Summary		15

Proxy Statement

 

		Intel Corporation 2200 Mission College Blvd. Santa Clara, CA 95054-1549

Our Board of Directors solicits your proxy for the 2021 Annual Stockholders’ Meeting (and any postponement or adjournment of the meeting) for the matters set forth in the “Notice of 2021 Annual Stockholders’ Meeting.” We made this proxy statement available to stockholders beginning on March 30, 2021.

 

Proposal 1

Election of Directors

Upon the recommendation of our Corporate Governance and Nominating Committee, our Board has nominated the nine individuals listed below to serve as directors. Our nominees include eight independent directors, as defined in the rules for companies traded on the Nasdaq Global Select Market* (Nasdaq), and one Intel officer: Patrick P. Gelsinger, who became our Chief Executive Officer in February 2021. Dr. Omar Ishrak has served as the independent Chairman of the Board since January 2020.

Each of our director nominees currently serves on the Board and was elected to a one-year term at the 2020 Annual Stockholders’ Meeting, except for Dion J. Weisler, who was appointed to the Board in June 2020, and Mr. Gelsinger, who was appointed to the Board in February 2021. Andy D. Bryant and Reed E. Hundt retired from the Board in May 2020. Andrew Wilson is not standing for re-election at the 2021 Annual Stockholders’ Meeting.

Each director’s term runs from the date of their election until our next annual stockholders’ meeting and until their successor (if any) is elected or appointed. If any director nominee is unable or unwilling to serve as a nominee at the time of the annual meeting, the individuals named as proxies may vote for a substitute nominee chosen by the present Board to fill the vacancy. Alternatively, the Board may reduce the size of the Board, or the proxies may vote just for the remaining nominees, leaving a vacancy that the Board may fill at a later date. However, we have no reason to believe that any of the nominees will be unwilling or unable to serve if elected as a director.

Our Amended and Restated Bylaws (Bylaws) provides that a director nominee is elected only if they receive a majority of the votes cast with respect to their election in an uncontested election (that is, the number of votes cast “for” that nominee exceeds the number of votes cast “against” that nominee). You can vote to “abstain,” but that vote will not have an effect in determining the election results. For more information, see “Additional Meeting Information; Voting Before or During the Meeting” on page 118. If a nominee who currently serves as a director is not re-elected, Delaware law provides that the director would continue to serve on the Board as a “holdover director.” Under our Bylaws and the Amended and Restated Board of Directors Guidelines on Significant Corporate Governance Issues (Corporate Governance Guidelines), each director must submit an advance, contingent, irrevocable resignation that the Board may accept if stockholders do not re-elect that director. In that situation, our Corporate Governance and Nominating Committee would make a recommendation to the Board about whether to accept or reject the resignation, or whether to take other action instead. Within 90 days from the date of the certified election results, the Board would act on the Corporate Governance and Nominating Committee’s recommendation and publicly disclose its decision and the rationale behind it.

For each of the nine director nominees standing for election, the following pages set forth certain biographical information, including a description of their principal occupation, business experience, and the primary qualifications, attributes and skills (represented by the icons below) that the Corporate Governance and Nominating Committee considered in recommending them as director nominees, as well as the Board committees on which each director nominee will serve as of the 2021 Annual Stockholders’ Meeting.

 

 

		Recommendation of the Board The Board recommends that you vote “FOR” the election of each of the following nominees.

Senior Leadership Experience

Global/ International Experience

Industry and IT/ Technical Experience

Financial Expertise

Human Capital Experience

Operating and Manufacturing Experience

Sales, Marketing and Brand Management

Emerging Technologies and Business Models

Business Development and M&A Experience

Cybersecurity/ Information Security

Government, Legal, and Regulatory

Public Company Board

 

16		Proposal 1: Election of Directors  |  2021 PROXY STATEMENT

Qualifications:

As a seasoned industry veteran with over 40 years of experience in semiconductor, software, and cloud computing and data storage industries and in his role as our new CEO, Mr. Gelsinger brings significant senior leadership, global, industry, human capital, sales, operating, business development and M&A, and public company board experience to the Board. Mr. Gelsinger has gained extensive operating and manufacturing, sales, emerging technologies, M&A, and information security experience from serving in a variety of senior management roles, including CEO and COO, at leading multinational software, information security and computing companies. Having started his career at Intel, he has over 30 years of direct knowledge and experience in Intel’s culture, business development, strategy, and growth. Mr. Gelsinger also brings human capital and technical experience from his various senior leadership roles.

 

Qualifications:

Mr. Goetz brings to the Board senior leadership, industry and information technology (IT), emerging technologies, business development, and cybersecurity experience from his experience as a partner of a venture capital firm, where he focuses on cloud, mobile, and enterprise technology investments, as well as providing guidance and counsel to a wide variety of internet and technology companies, and his prior work in networks, data security and storage, software, and manufacturing through various senior roles and other board experiences. Mr. Goetz’s experience with internet and technology companies brings depth to the Board in areas that are important to Intel’s business as it moves from a CPU to a multi-architecture xPU company, from silicon to platforms, and from a traditional IDM to a new, modern IDM.

 

*	Effective after the conclusion of Intel’s 2021 Annual Stockholders’ Meeting, provided he/she is re-elected to the Board by stockholders at the meeting. For more information on committee changes, please see “Board Responsibilities and Committees” on page 34.

 

		2021 PROXY STATEMENT  |  Proposal 1: Election of Directors		17

Qualifications:

Ms. Henry brings senior leadership, industry and IT, emerging technologies and business models, and information security expertise to the Board from her executive experience at a mobile payment process company, including overseeing its expansion into other technology services for small businesses, and by her leadership of the software development segment of a multinational technology company that focuses on e-commerce, cloud computing, digital streaming, and artificial intelligence. Ms. Henry’s more than 25 years of experience in software engineering and development of database and storage technologies is particularly useful to the Board as Intel moves from a PC-centric to data-centric company.

 

Qualifications:

Dr. Ishrak brings senior leadership, operating and manufacturing, and international expertise to the Board from his position as Chairman and CEO of Medtronic and his long history of success as a global executive in the medical technology industry. From his role at Medtronic, Dr. Ishrak has extensive experience identifying and developing emerging technologies and has overseen a number of strategic acquisitions, enabling him to bring business development and mergers and acquisitions (M&A) experience to the Board. Dr. Ishrak held various product development and engineering positions at Philips Ultrasound. Dr. Ishrak also provides technical, human capital, and brand marketing expertise from his role as a leader of a global medical technology company.

 

*	Effective after the conclusion of Intel’s 2021 Annual Stockholders’ Meeting, provided he/she is re-elected to the Board by stockholders at the meeting. For more information on committee changes, please see “Board Responsibilities and Committees” on page 34.

 

18		Proposal 1: Election of Directors  |  2021 PROXY STATEMENT

Qualifications:

Dr. Lavizzo-Mourey brings senior leadership, strategy, and human capital and talent development expertise to the Board from her leadership of the largest public health philanthropy in the U.S. for almost 15 years and, before that, serving for 15 years as a distinguished professor and administrator at the University of Pennsylvania. She also brings to the Board government experience from her various government appointments. Dr. Lavizzo-Mourey’s board service with other public companies also provides extensive public company board experience.

 

 

Qualifications:

As a scholar and educator in the field of semiconductor logic and memory devices, who conducts research on advanced materials, process technology and solid-state devices for energy-efficient electronics, Dr. Liu brings to the Board industry and technical experience directly related to Intel’s semiconductor device research and development, and manufacturing. As a Co-founder of Progressant Technologies, which was later acquired by Synopsys, Inc., and while serving on technical advisory boards for multiple start-up companies, Dr. Liu gained business development experience. Her inventions and contributions to the fin-shaped field-effect transistor design, dubbed “FinFET,” have given Dr. Liu extensive experience in emerging technologies. She also brings global and international experience to the Board with her work on establishing strategic international partnerships and agreements for UC Berkeley.

 

*	Effective after the conclusion of Intel’s 2021 Annual Stockholders’ Meeting, provided he/she is re-elected to the Board by stockholders at the meeting. For more information on committee changes, please see “Board Responsibilities and Committees” on page 34.

 

		2021 PROXY STATEMENT  |  Proposal 1: Election of Directors		19

Qualifications:

Mr. Smith brings to the Board senior leadership, financial, strategic, operational, human capital, and global expertise from his experience as Executive Vice President, Enterprise Performance and Strategy of the world’s largest aerospace company. He has experience with budgeting, accounting controls, internal audit, financial forecasting, strategic financial planning and analysis, capital commitment planning, competitive analysis and benchmarking, investor relations, and M&A from his work as Boeing’s CFO. Mr. Smith also brings substantial international and business development experience to the Board from his enterprise performance and strategy role at Boeing. Mr. Smith’s portfolio also includes Boeing HorizonX, the venture capital arm of Boeing that identifies and invests in start-ups that are developing emerging technologies and businesses in markets such as cybersecurity, AI and machine learning, and autonomous systems among others. He has continuing experience in dealing with foreign governments, including on issues related to market access and the regulation of business and investment. Mr. Smith also brings operational experience to the Board, having held a number of leadership roles at Boeing in supply chain, factory operations, and program management.

 

 

*	Effective after the conclusion of Intel’s 2021 Annual Stockholders’ Meeting, provided he/she is re-elected to the Board by stockholders at the meeting. For more information on committee changes, please see “Board Responsibilities and Committees” on page 34.

 

20		Proposal 1: Election of Directors  |  2021 PROXY STATEMENT

Qualifications:

Mr. Weisler brings to the Board senior leadership, global and international, industry and information technology (IT), operating and manufacturing, emerging technologies, and cybersecurity experience from his more than 25 years of experience in the IT industry. From his role as the Chief Executive Officer of one of the world’s largest technology companies, Mr. Weisler also has financial expertise and extensive experience managing human capital and executing a business development and M&A strategy. Mr. Weisler also brings valuable board-level experience from his years of service on the boards of multinational companies like HP, Thermo Fisher Scientific and the BHP Group.

 

 

 

*	Effective after the conclusion of Intel’s 2021 Annual Stockholders’ Meeting, provided he/she is re-elected to the Board by stockholders at the meeting. For more information on committee changes, please see “Board Responsibilities and Committees” on page 34.

 

		2021 PROXY STATEMENT  |  Proposal 1: Election of Directors		21

Qualifications:

Mr. Yeary’s career in investment banking brings to the Board financial strategy and global M&A expertise, including expertise in financial reporting and experience in assessing the efficacy of M&A on a global scale, and experience attracting and retaining strong senior leaders. At Darwin Capital Advisors, Mr. Yeary has evaluated, invested in and served as a board member for numerous venture stage companies, giving him first-hand experience identifying and developing business models. Mr. Yeary’s experience as Co-founder and Executive Chairman of CamberView Partners and his service on the board of PayPal provides insight into matters relating to corporate governance, stockholder engagement, and board best practices. As Vice Chancellor of a large public research university, Mr. Yeary gained extensive strategic, operational, and financial expertise.

 

*	Effective after the conclusion of Intel’s 2021 Annual Stockholders’ Meeting, provided he/she is re-elected to the Board by stockholders at the meeting. For more information on committee changes, please see “Board Responsibilities and Committees” on page 34.

 

22		Proposal 1: Election of Directors  |  2021 PROXY STATEMENT

Director Skills, Experience, and Background

Intel is a large technology company engaged in research, manufacturing, and marketing on a global scale. We operate in highly competitive markets characterized by rapidly evolving technologies and exposure to business cycles. As we discuss below under “Board Responsibilities and Committees,” the Corporate Governance and Nominating Committee is responsible for assessing with the Board the appropriate skills, experience, and background that we seek in Board members in the context of our business and the existing composition of the Board. This assessment includes numerous diverse factors, such as independence; understanding of and experience in manufacturing, technology, finance, and marketing; senior leadership experience; international experience; mix of ages; and gender, racial, geographic and ethnic diversity. The Board then determines whether a nominee’s background, experience, personal characteristics, and skills will advance the Board’s goal of creating and sustaining a Board with a diversity of perspectives and viewpoints that can support and oversee the company’s complex activities. Our Board is committed to actively seeking women and minority director candidates for consideration. As set forth in our Corporate Governance Guidelines, the Corporate Governance and Nominating Committee, and the Board periodically review and assess the effectiveness of these practices for considering potential director candidates.

Listed below are the skills and experience that we consider important for our directors in light of our current business and structure. The directors’ biographies note each director’s relevant experience, qualifications, and skills relative to this list.

 

				Senior Leadership Experience Directors who have served in senior leadership positions are important to us because they have the experience and perspective to analyze, shape, and oversee the execution of important operational and policy issues. These directors’ insights and guidance, and their ability to assess and respond to situations encountered in serving on our Board, may be enhanced by leadership experience at businesses or organizations that operated on a global scale, faced significant competition, or involved technology or other rapidly evolving business models.
				Global/International Experience We are a global organization with R&D, manufacturing, assembly, and test facilities, and sales and other offices in many countries. In addition, the majority of our revenue comes from sales outside the U.S. Because of these factors, directors with global experience can provide valuable business and cultural perspective regarding many important aspects of our business.
				Industry and IT/Technical Experience Because we design and manufacture technology, hardware, and software, education or experience in relevant technology is useful for understanding our R&D efforts, competing technologies, the products and processes we develop, our manufacturing and assembly and test operations, and the market segments in which we compete.
				Financial Expertise Knowledge of financial markets, financing and funding operations, and accounting and financial reporting processes is also important. This experience assists our directors in understanding, advising on, and overseeing Intel’s capital structure, financing, and investing activities, as well as our financial reporting and internal controls.
				Human Capital Experience Because the market for senior technology leaders is extremely competitive, experience attracting and retaining top talent, particularly in high-demand areas such as cloud computing, AI, graphics processing units, and autonomous driving, can be an important skill for the Board to possess. In addition, evolving our culture is critical to delivering on our growth strategy and for continuing to attract and retain top talent, so directors with experience overseeing and helping to shape an organization’s culture are a valuable asset to the Board.
				Operating and Manufacturing Experience Because we are a leader in the design and manufacturing of advanced integrated digital technology platforms, understanding of and experience with manufacturing and other operational processes is a valuable asset to the Board.
				Sales, Marketing, and Brand Management Experience Directors with sales, marketing, and brand management experience can provide expertise and guidance as we seek to grow sales and enhance our brand.
				Emerging Technologies and Business Models Experience Emerging technologies and business models can rapidly disrupt even the most well-thought-out strategy, particularly for technology companies. Directors with experience identifying and developing emerging technologies and business models can be valuable assets to the Board.

 

		2021 PROXY STATEMENT  |  Proposal 1: Election of Directors		23

				Business Development and M&A Experience Directors with a background in business development and M&A provide insight into developing and implementing strategies for growing our business. Useful experience in this area includes skills in assessing “make” vs. “buy” decisions, analyzing the “fit” of a proposed acquisition with a company’s strategy, valuing transactions, and assessing management’s plans for integration with existing operations.
				Cybersecurity/Information Security Directors who have experience managing cybersecurity and information security risks or who understand the cybersecurity threat landscape can provide valuable knowledge and guidance to the Board in its oversight of the company’s cybersecurity risks.
				Government, Legal, and Regulatory Experience Directors who have served in government positions provide experience and insights that help us work constructively with governments around the world and address significant public policy issues, particularly as they relate to Intel’s operations and to public support for science, technology, engineering, and mathematics education. Directors with a background in law can assist the Board in fulfilling its oversight responsibilities regarding Intel’s legal and regulatory compliance and its engagement with regulatory authorities.
				Public Company Board Experience Directors with public company board experience understand the dynamics and operation of a corporate board, the relationship of a public company board to the CEO and other senior management personnel, the legal and regulatory landscape in which public companies must operate, the importance of particular agenda and oversight issues, and how to oversee an ever-changing mix of strategic, operational, and compliance-related matters.
				Background Members representing a mix of ages, genders, races, ethnicities, geographies, cultures, and other perspectives expand the Board’s understanding of the needs and viewpoints of our customers, partners, employees, governments, stockholders, and other stakeholders worldwide.

 

24		Proposal 1: Election of Directors  |  2021 PROXY STATEMENT

Board Matrix

Listed below are the skills and experience that we consider important for our director nominees in light of our current business strategy and structure. The directors’ biographies note each director’s relevant experience, qualifications, and skills relative to this list.

 

 

		2021 PROXY STATEMENT  |  Proposal 1: Election of Directors		25

Director Tenure

 

The Board generally believes that a mix of long- and short-tenured directors promotes an appropriate balance of views and insights and allows the Board as a whole to benefit from the historical and institutional knowledge that longer-tenured directors possess and the fresh perspectives contributed by newer directors. Our Corporate Governance Guidelines provide that, as an alternative to term limits, the Board seeks to maintain an average tenure of 10 years or less for the independent directors as a group.   If each independent director nominee is elected to the Board, after the 2021 Annual Stockholders’ Meeting, our independent directors will have served an average of 3.9 years on the Board. Overall, our Board, including both independent and employee directors, will have an average tenure of 3.4 years. We believe that this mix of tenure on the Board represents a diversified “portfolio” of new perspectives and deep institutional knowledge.

Board Diversity and Refreshment

 

Our Board is committed to building a Board with diverse experiences and backgrounds. In 2014, the Board formally adopted its commitment to actively seek women and minority candidates for the pool from which board candidates are chosen. In connection with our Board refreshment process, the Governance Committee seeks input from Intel’s head or acting head of Global Diversity and Inclusion. Representation of gender, race, ethnic, geographic, cultural, or other diverse perspectives expands the Board’s understanding of the needs and viewpoints of our customers, partners, employees, governments, and other stakeholders worldwide. As part of our ongoing commitment to creating a balanced Board with diverse viewpoints and deep industry expertise, we regularly add new directors to infuse new ideas and fresh perspectives in the boardroom.   Our directors reflect diverse perspectives, including a complementary mix of skills, experience, and backgrounds that we believe are paramount to our ability to represent your interests as stockholders. In the last five years, eight new independent directors have been elected or appointed to the Board, three of whom have been women. If each director nominee is elected to the Board, after the 2021 Annual Stockholders’ Meeting, the majority of the Board would be diverse based on directors’ gender, race, ethnicity, and/or nationality. Intel is committed to focusing on Board diversity more broadly through engagement with key partners. In 2018, Intel joined the Thirty Percent Coalition (Coalition), which focuses on strategies to increase female representation on corporate boards. In 2019, the Coalition added a specific focus on women of color. In 2020, the Governance Committee engaged with two search firms with ties to diverse organizations in order to source more diverse candidate pools. In addition, through our partnerships, we aim to not only increase the available talent for our Board, but to also support increased female board representation across our industry.

 

26		Proposal 1: Election of Directors  |  2021 PROXY STATEMENT

Our Board is focused on achieving the right mix of skills, experience, and perspectives to support Intel’s future strategic direction, including its transformation from a CPU to a multi-architecture xPU company, from silicon to platforms, and from a traditional IDM to a new, modern IDM. For example, we have recently prioritized industry knowledge and experience in our director recruitment efforts, as reflected by the recent additions of Mr. Goetz, Ms. Henry, and Mr. Weisler to our Board. In addition, recognizing the importance of the Board’s role in overseeing human capital risks as Intel undergoes a cultural transformation, over the past few years we have also added directors with human capital management experience, including most recently Mr. Weisler.

Board Evaluations

We are committed to providing transparency about our Board and committee evaluation process. Our Chairman of the Board leads the Board’s self-evaluation process. Each director completes a comprehensive questionnaire evaluating the performance of the Board as a whole, the committees on which the director serves, the director’s own performance, and the performance of each of the director’s peers on the Board. The directors’ responses are aggregated and anonymized to encourage the directors to respond candidly and to maintain the confidentiality of their responses. The Chairman summarizes the directors’ responses about the performance of the Board as a whole and the committees and shares his findings with the Board. The annual evaluation process provides the Board with valuable insight regarding areas where the Board believes it functions effectively and, more importantly, areas where the Board believes it can improve. For example, input generated by Board members in recent years has focused, among other things, on industry experience, which has encouraged and informed our recent Board refreshment efforts.

 

		2021 PROXY STATEMENT  |  Proposal 1: Election of Directors		27

Corporate Governance

 

Board Leadership Structure

Chairman of the Board: Omar Ishrak

Chief Executive Officer: Patrick P. Gelsinger

Board Leadership Structure. We separate the roles of Board Chairman and CEO to aid in the Board’s oversight of management. This policy is embodied in the Board’s published Corporate Governance Guidelines, and has been in effect since the company began operations. At times, the Chairman has been a former executive of the company and has served as a full-time executive officer, as was the case with Mr. Bryant, who served as Executive Chairman until January 2020. At other times, an independent director has served as non-executive Chairman, as is the case with our current Chairman of the Board, Dr. Ishrak.

The Board believes that there are advantages to having an independent chairman, including by helping to facilitate relations between the Board, the CEO, and other senior management, assist the Board in reaching consensus on particular strategies and policies, and foster robust evaluation processes; and by efficiently allocating oversight responsibilities between the independent directors and management.

Chairman Responsibilities. Our CEO has primary responsibility for the operational leadership and strategic direction of Intel, while our Chairman facilitates our Board’s oversight of management, promotes communication between management and our Board, engages with stockholders, and leads our Board’s consideration of key governance matters. As non-executive Chairman, Dr. Ishrak’s responsibilities include:

 

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presiding over all meetings of the Board;

 

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developing the schedule and agenda for Board meetings in consultation with the CEO, Corporate Secretary, and other members of the Board;

 

§

assessing the quality, quantity, and timeliness of the information submitted by the company’s management that is necessary or appropriate for the non-employee directors to effectively and responsibly perform their duties;

 

§

calling and presiding over meetings of the independent directors;

 

§

working with the Corporate Governance and Nominating Committee to evaluate potential director candidates, determine the membership of the various Board committees, and select committee chairs;

 

§

managing the Board’s process for annual director self-assessment and evaluation of the Board and its committees;

 

§

evaluating the performance of the CEO and overseeing CEO succession planning;

 

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serving as principal liaison between the Board and the CEO;

 

§

presiding over all meetings of stockholders; and

 

§

serving as the Board’s liaison for consultation and direct communication with stockholders.

The independent directors periodically assess the Board’s leadership structure and will continue to evaluate and implement the leadership structure that they conclude most effectively supports the Board in fulfilling its responsibilities.

 

28		Corporate Governance  |  2021 PROXY STATEMENT

The Board’s Role in Risk Oversight at Intel

An important function of the Board is oversight of risk management at Intel. Risk is inherent in business, and the Board’s oversight, assessment, and decisions regarding risks occur in the context of and in conjunction with the other activities of the Board and its committees.

Defining Risk. The Board and management consider “risk” to be the possibility that an undesired event could occur that might adversely affect the achievement of our objectives. Risks vary in many ways, including the ability of the company to anticipate and understand the risk, the types of adverse impacts that could result if the undesired event occurs, the likelihood that an undesired event and a particular adverse impact would occur, and the ability of the company to control the risk and the potential adverse impacts. Examples of the types of risks faced by Intel include:

 

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macro-economic risks, such as inflation, deflation, reductions in economic growth, or recession;

 

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political risks, such as restrictions on access to markets, increased taxation, or expropriation of assets;

 

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event risks, such as natural disasters, public health crises, or cybersecurity incidents; and

 

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business-specific risks related to strategy and competition, product demand, global operations, products and manufacturing, cybersecurity and privacy, intellectual property protection and theft, litigation and regulatory compliance, corporate responsibility and sustainability (including climate risk), human capital risks, and corporate governance risks.

Not all risks can be dealt with in the same way. Some risks may be readily perceived and controllable, while other risks are unknown; some risks can be avoided or mitigated by particular behavior, and some risks are unavoidable as a practical matter. In some cases, a decision may be made that a higher degree of risk may be acceptable because of a greater perceived potential for reward. Intel seeks to align its voluntary risk-taking with company strategy, and Intel understands that its projects and processes may enhance the company’s business interests by encouraging innovation and appropriate levels of risk-taking.

 

		2021 PROXY STATEMENT  |  Corporate Governance		29

Risk Assessment Responsibilities and Processes

 

Committees as of March 9, 2020

Audit   Oversees issues related to financial reporting, internal controls, audit functions, and major financial, product security, and cybersecurity risk exposures, and management’s annual enterprise risk management assessment

Compensation   Oversees management of risks related to the company’s compensation programs, including our conclusion that our compensation policies and practices do not create risks that are reasonably likely to have a material adverse effect on the company, and risks related to human capital management

Corporate Governance and Nominating   Oversees issues related to risks arising from the company’s environmental, social and governance practices as well as corporate responsibility and sustainability initiatives and performance

Finance   Oversees issues related to financial risk management, including the company’s risk tolerance in cash- management investments

 

 

 

30		Corporate Governance  |  2021 PROXY STATEMENT

Director Independence and Transactions Considered in Independence Determinations

Director Independence. The Board has determined that each of the following non-employee directors qualifies as “independent” in accordance with the published listing requirements of Nasdaq: Mr. Goetz, Ms. Henry, Dr. Ishrak, Dr. Lavizzo-Mourey, Dr. Liu, Mr. Smith, Mr. Weisler, Mr. Wilson (who is not standing for re-election), and Mr. Yeary. Because Mr. Gelsinger is employed by Intel, he does not qualify as independent. Messrs. Bryant and Swan, who served as directors until May 2020 and February 2021, respectively, did not qualify as independent because of their employment by Intel.

The Nasdaq rules have objective tests and a subjective test for determining who is an “independent director.” Under the objective tests, a director cannot be considered independent if:

 

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The director is, or at any time during the past three years was, an employee of the company;

 

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The director or a family member of the director accepted any compensation from the company in excess of $120,000 during any period of 12 consecutive months within the three years preceding the independence determination (subject to certain exclusions, including, among other things, compensation for Board or Board committee service);

 

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A family member of the director is, or at any time during the past three years was, an executive officer of the company;

 

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The director or a family member of the director is a partner in, a controlling stockholder of, or an executive officer of an entity to which the company made, or from which the company received, payments in the current or any of the past three fiscal years that exceeded 5% of the recipient’s consolidated gross revenue for that year, or $200,000, whichever was greater (subject to certain exclusions);

 

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The director or a family member of the director is employed as an executive officer of an entity for which at any time during the past three years any of the executive officers of the company served on the compensation committee of such other entity; or

 

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The director or a family member of the director is a current partner of the company’s outside auditor, or at any time during the past three years was a partner or employee of the company’s outside auditor, and who worked on the company’s audit.

The subjective test states that an independent director must be a person who lacks a relationship that, in the opinion of the Board, would interfere with the exercise of independent judgment in carrying out the responsibilities of a director. The Board has not established categorical standards or guidelines to make these subjective determinations, but considers all relevant facts and circumstances.

In addition to the Board-level standards for director independence, the directors who serve on the Audit Committee each satisfy standards established by the U.S. Securities and Exchange Commission (SEC) and Nasdaq, as no member of the Audit Committee accepts directly or indirectly any consulting, advisory, or other compensatory fee from the company other than their director compensation, or otherwise has an affiliate relationship with the company. Similarly, the members of the Compensation Committee each qualify as independent under SEC and Nasdaq standards. Under these standards, the Board considered that none of the members of the Compensation Committee accept directly or indirectly any consulting, advisory, or other compensatory fee from the company other than their director compensation, and that none have any affiliate relationships with the company or other relationships that would impair the director’s judgment as a member of the Compensation Committee.

Transactions Considered in Independence Determinations. In making its subjective determination that each non-employee director is independent, the Board reviewed and discussed additional information provided by the directors and the company with regard to each director’s business and personal activities as they may relate to Intel and Intel’s management and considered transactions that occurred since the beginning of 2018 between Intel and entities associated with the independent directors or members of their immediate families. The Board considered the transactions in the context of the Nasdaq objective standards and the special standards established by the SEC and Nasdaq for members of audit and compensation committees. Based on this review, as required by the Nasdaq rules, the Board made a subjective determination that, based on the nature of the directors’ relationships with the entity and/or the amount involved, no relationships exist that, in the opinion of the Board, impair the directors’ independence. The Board’s independence determinations took into account the following transactions:

Business Relationships. Each of our non-employee directors (or one of his or her immediate family members) is, or was during the previous three fiscal years, a non-management director, trustee, advisor, or executive or served in a similar position at another entity that did business with Intel at some time during those years. The business relationships were ordinary course dealings as a supplier or purchaser of goods or services; licensing or research arrangements; facility, engineering, and equipment fees; or commercial paper or similar financing arrangements in which Intel or an affiliate participated as a creditor. Payments to or from

 

		2021 PROXY STATEMENT  |  Corporate Governance		31

each of these entities constituted less than the greater of $200,000 or 1% of each of Intel’s and the recipient’s annual revenue, respectively, in each of the past three years; there were no exceptions for the above-referenced time period.

Charitable Contributions. Dr. Lavizzo-Mourey, Dr. Liu, or one of their immediate family members is serving, or has each served during the previous three fiscal years, as an executive, professor, or other employee for one or more colleges or universities or as a director, executive, or employee of a charitable entity that received matching or other charitable contributions from Intel during those years. Charitable contributions to each of these entities (including matching and discretionary contributions by Intel and the Intel Foundation) constituted less than the greater of $120,000 or 1% of the recipient’s annual revenues in each of the past three years, as discussed below.

 

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Dr. Liu is Dean and Roy W. Carlson Professor of Engineering in the College of Engineering at UC Berkeley. The Intel Foundation contributed less than $59,500 in each of the past three years to match Intel employee charitable contributions to UC Berkeley, amounting to less than 0.003% of UC Berkeley’s consolidated annual revenue for each of the past three years.

 

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Dr. Lavizzo-Mourey retired in January 2021 after serving as the Robert Wood Johnson Foundation PIK Professor of Population Health and Health Equity at the University of Pennsylvania. The Intel Foundation contributed less than $14,300 in each of the past three years to match Intel employee charitable contributions to the University of Pennsylvania, amounting to less than 0.0001% of the University of Pennsylvania’s consolidated annual revenue for each of the past three years.

 

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Dr. Lavizzo-Mourey is a member of the Board of Regents of the Smithsonian Institution. The Intel Foundation contributed less than $9,400 in each of the past three years to match Intel employee charitable contributions to the Smithsonian Institution, amounting to less than 0.01% of the Smithsonian Institution’s consolidated annual revenue for each of the past three years, and in 2019, Intel entered into a sponsorship agreement with the Smithsonian Institution, amounting to less than 0.78% of the Smithsonian Institution’s consolidated annual revenue for 2019.

 

32		Corporate Governance  |  2021 PROXY STATEMENT

Corporate Governance Guidelines

Intel has long maintained a set of Corporate Governance Guidelines. The Corporate Governance and Nominating Committee reviews the guidelines periodically and recommends amendments to the Board as appropriate. The Board oversees administration and interpretation of, and compliance with, the guidelines and may amend, waive, suspend, or repeal any of the guidelines at any time, with or without public notice subject to legal requirements, as it determines necessary or appropriate in the exercise of the Board’s judgment in its role as fiduciary.

These guidelines, which investors may find on our website at www.intel.com/governance, along with our other corporate governance practices, compare favorably under the Investor Stewardship Group’s (ISG) Corporate Governance Framework for U.S. Listed Companies, as shown in the table below.

 

ISG Principle		Intel Practice
Principle 1 Boards are accountable to stockholders		§  All directors are elected annually   §  Majority voting in uncontested director elections   §  Proxy access with market terms (3% for three years, up to 20% of the Board)   §  Annual Chairman’s letter in proxy statement that describes the Board’s activities over the past year
Principle 2 Stockholders should be entitled to voting rights in proportion to their economic interest		§  No dual-class share structure   §   Each stockholder is entitled to one vote per share
Principle 3 Boards should be responsive to stockholders and be proactive in order to understand their perspectives		§  Chairman met with investors owning almost 30% of shares outstanding in 2020   §  Engagement topics included strategy, culture and human capital management; issues concerning ESG matters; executive compensation; and stockholder proposals   §  The Board has made a number of changes in response to investor feedback, including:   §  adding additional industry experience to the Board;   §  enhancing further the integration of ESG disclosure into our Form 10-K, proxy statement, and Corporate Responsibility Report;   §  working on aligning human capital and climate risk disclosures with external frameworks;   §  adding three-year EPS as a performance metric for performance-based RSUs; and   §  proactively lowering the stockholder special meeting threshold to 15% from 25%
Principle 4 Boards should have a strong, independent leadership structure		§  Independent Chairman, separate from CEO   §   Board considers appropriateness of its leadership structure at least annually   §   Independent committee chairs   §   Independent directors meet in executive session at least three times per year
Principle 5 Boards should adopt structures and practices that enhance their effectiveness		§  89% of the director nominees are independent   §   33% of the director nominees are ethnically diverse, 33% of the director nominees are gender diverse, and we have a policy of seeking out women and minority candidates, as well as candidates with diverse backgrounds, experiences, and skills, as part of each Board search   §   Annual Board and committee self-evaluations, as well as self- and peer-assessments   §   Active Board refreshment, with eight new directors joining since 2017, and seek to cap average director tenure at 10 years   §   Limits on outside boards, with no director permitted to serve on more than four public company boards (including Intel)   §   No restrictions on directors’ access to management or employees   §   No independent director is expected to stand for re-election after age 75 without prior Board approval
Principle 6 Boards should develop management incentive structures that are aligned with the long-term strategy of the company		§  Compensation Committee annually reviews and approves incentive program design, goals, and objectives for alignment with compensation and business strategies   §  Annual and long-term incentive programs are designed to reward financial and operational performance that furthers short- and long-term strategic objectives

 

		2021 PROXY STATEMENT  |  Corporate Governance		33

Director Attendance

The Board held six regularly scheduled meetings and ten special meetings in 2020. As shown in the Board Committee chart below, standing committees of the Board collectively held a total of 44 meetings during 2020, with each committee holding a number of regularly scheduled and special meetings. We expect each director to attend every meeting of the Board and the committees on which he or she serves. Each director attended at least 75% of the meetings of the Board and each committee on which he or she served in 2020 (held during the period in which the director served), and on average directors attended 96% of Board and committee meetings. The Board’s policy is that directors should endeavor to attend the annual stockholders’ meeting, and eight out of 10 of the then-incumbent directors attended the 2020 Annual Stockholders’ Meeting.

Board Responsibilities and Committees

Board Responsibilities. The Board oversees, counsels, and directs management in the long-term interests of the company and our stockholders. The Board’s responsibilities include:

 

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overseeing the conduct of our business and the assessment of our business and other enterprise risks to evaluate whether the business is being properly managed;

 

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planning for CEO succession and monitoring management’s succession planning for other senior executives;

 

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reviewing and approving our major financial objectives, strategy, operating plans, and other significant actions;

 

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selecting the CEO, evaluating CEO performance, and determining the compensation of the CEO and other executive officers; and

 

§

overseeing our processes for maintaining the integrity of our financial statements and other public disclosures, and our compliance with law and ethics.

The Board and its committees met throughout the year on a set schedule, held special meetings, and acted by written consent from time to time as necessary. At each regular Board meeting, time is reserved for the independent directors to meet in executive session without the CEO present. Officers regularly attend Board meetings to present information on our business and strategy, and Board members have access to our employees outside of Board meetings. Board members are encouraged to make site visits on a worldwide basis to meet with local management; to attend Intel industry, analyst, and other major events; and to accept invitations to attend and speak at internal Intel meetings. In 2020, due to COVID-19 restrictions, the majority of activities were conducted virtually.

The Board’s Role in Succession Planning. As reflected in our Corporate Governance Guidelines, the Board’s primary responsibilities include planning for CEO succession and monitoring management’s succession planning for other senior executives. The Board’s goal is to have a long-term and continuing program for effective senior leadership development and succession. For more information regarding our Leadership Transformation decisions, please see “Compensation Discussion and Analysis; Executive Summary; Leadership Transformation” on page 66.

Board Committees. The Board assigns responsibilities and delegates authority to its committees, and the committees regularly report on their activities and actions to the full Board. For 2020, the Board had five standing committees: Audit, Compensation, Corporate Governance and Nominating, Executive, and Finance. Each committee could engage outside experts, advisors, and counsel to assist the committee in its work.

Each committee has a written charter approved by the Board. We post each charter in the Corporate Governance section of our website at www.intc.com/board-and-governance.

 

34		Corporate Governance  |  2021 PROXY STATEMENT

The following table identifies the current committee members as of March 9, 2021. As discussed above, the Board has determined that each member of the Audit, Compensation, and Corporate Governance and Nominating Committees is an independent director in accordance with Nasdaq standards.

 

Board Committee Members as of March 9, 2021

Name

Audit

Compensation

Corporate Governance and     Nominating

Executive

Finance

Patrick P. Gelsinger

☐

James J. Goetz

☐

☐

Alyssa Henry

☐

☐

Omar Ishrak*

☐

☐

§

Risa Lavizzo-Mourey

☐

§

☐

Tsu-Jae King Liu

☐

§

Gregory D. Smith

§

☐

☐

Dion J. Weisler

☐

☐

Andrew Wilson

§

☐

Frank D. Yeary

☐

☐

☐

Number of Committee Meetings Held in 2020

15

10

12

1

6

 

*		Chairman of the Board
§		Committee Chair
☐		Member

Audit Committee

Membership as of March 9, 2021: Gregory D. Smith (Chair), Alyssa Henry, Tsu-Jae King Liu, and Frank D. Yeary

 

§

Assists the Board in its general oversight of our financial reporting, internal controls, and audit functions.

 

§

Appoints and retains our independent registered public accounting firm, managing its compensation, and overseeing its work.

 

§

Reviews and discusses with management our major financial, product security, and cybersecurity risk exposures and the steps management has taken to monitor and control such exposures; and our annual enterprise risk management assessment.

 

§

Receives periodic reports from the Global Director of Ethics and Legal Compliance, no less than annually, on the operation and effectiveness of our corporate compliance program.

 

§

Oversees compliance with our Code of Conduct.

During the past year, the Audit Committee’s oversight focused on, among other things, key financial reporting and disclosure matters, critical accounting estimates, ethical and legal compliance, and enterprise risk management, including cybersecurity and product security. The Board has determined that Mr. Yeary and Mr. Smith each qualify as an “audit committee financial expert” under SEC rules and that each Audit Committee member is sufficiently proficient in reading and understanding the company’s financial statements to serve on the Audit Committee. The responsibilities and activities of the Audit Committee are described in detail in “Report of the Audit Committee” in this proxy statement and the Audit Committee’s charter.

Compensation Committee

Membership as of March 9, 2021: Andrew Wilson (Chair), Alyssa Henry, Omar Ishrak, Risa Lavizzo-Mourey, and Dion J. Weisler

 

§

Reviews, recommends, and approves salaries, bonuses, and other matters related to the compensation of our executive officers.

 

§

Reviews and approves the performance measures and goals for our executive officers.

 

§

Reviews and grants equity awards to our executive officers.

 

§

Reviews and determines other compensation policies, handles many compensation-related matters, and makes recommendations to the Board and to management on employee compensation and benefit plans.

 

§

Administers Intel’s equity incentive plans.

 

		2021 PROXY STATEMENT  |  Corporate Governance		35