W.W. GRAINGER, INC., DEF 14A filed on 3/7/2025
Proxy Statement (definitive)
v3.25.0.1
Cover
12 Months Ended
Dec. 31, 2024
Document Information [Line Items]  
Document Type DEF 14A
Amendment Flag false
Entity Information [Line Items]  
Entity Registrant Name W.W. Grainger, Inc.
Entity Central Index Key 0000277135
v3.25.0.1
Pay vs Performance Disclosure
12 Months Ended
Dec. 31, 2024
USD ($)
Dec. 31, 2023
USD ($)
Dec. 31, 2022
USD ($)
Dec. 31, 2021
USD ($)
Dec. 31, 2020
USD ($)
Pay vs Performance Disclosure          
Pay vs Performance Disclosure, Table
Year
Summary
Compensation
Table
Total for
PEO
(1)
Compensation
Actually
Paid to
PEO
(1)(2)(3)
Average
Summary
Compensation
Table
Total for
Non-PEO
NEOs
(1)
Average
Compensation
Actually
Paid to
Non-PEO
NEOs
(1)(2)(3)
Value of Initial
Fixed $100
Investment
Based On:
(4)
Net
Income
($MM)
Adjusted
ROIC
(5)
Daily Sales
Growth
(5)
TSR
Peer
Group
TSR
CSM
Supplemental
Measure
2024 $10,881,689 $15,759,913 $3,053,409 $4,239,678 $332 $260 $1,909 41.4% 4.5%
2023 $10,160,673 $23,002,860 $3,042,195 $4,822,536 $259 $223 $1,829 42.8% 9.2%
2022 $9,967,658 $14,293,346 $3,121,115 $3,736,729 $172 $151 $1,547 40.6% 16.5%
2021 $9,015,594 $16,301,335 $2,138,920 $2,891,203 $158 $170 $1,043 31.9% 12.8%
2020 $7,475,378 $14,661,338 $2,003,159 $3,002,624 $123 $125 $695 28.2% 3.5%
(1)
D.G. Macpherson was our PEO for each year presented. The individuals comprising the Non-PEO NEOs for each year presented are listed below.
2020
2021
2022
2023
2024
Thomas B. Okray
Deidra C. Merriwether
Deidra C. Merriwether
Deidra C. Merriwether
Deidra C. Merriwether
John L. Howard
Paige K. Robbins
Paige K. Robbins
Paige K. Robbins
Paige K. Robbins
Paige K. Robbins
John L. Howard
John L. Howard
Nancy L. Berardinelli-Krantz
Nancy L. Berardinelli-Krantz
Deidra C. Merriwether
Kathleen S. Carroll
Kathleen S. Carroll
Matthew E. Fortin
Jonny LeRoy
Robert F. O’Keef, Jr.
John L. Howard
Kathleen S. Carroll
(2)
The amounts shown for Compensation Actually Paid have been calculated in accordance with Item 402(v) of Regulation S-K of the Exchange Act and do not reflect compensation actually realized or received by the Company’s NEOs. These amounts reflect total compensation as set forth in the Summary Compensation Table above for each year, adjusted as described in footnote 3 below.
(3)
Compensation Actually Paid reflects the exclusions and inclusions of certain amounts for the PEO and the Non-PEO NEOs as set forth below. Equity values are calculated in accordance with FASB ASC Topic 718. Amounts in the Exclusion of Stock Awards and Option Awards column are the totals from the Stock Awards and Option Awards columns set forth in the Summary Compensation Table.
Year
Summary Compensation
Table Total
for Mr. Macpherson
Exclusion of Stock
Awards and Option
Awards for Mr. Macpherson
Total—Inclusion of
Equity Values for
Mr. Macpherson
Compensation
Actually Paid to
Mr. Macpherson
2024
$10,881,689 $(7,817,946) $12,696,170 $15,759,913
Year
Average Summary
Compensation Table
Total for
Non-PEO NEOs
Average Exclusion
of Stock Awards
and Option Awards for
Non-PEO NEOs
Total—Average
Inclusion of
Equity Values for
Non-PEO NEOs
Average Compensation
Actually Paid to
Non-PEO NEOs
2024
$3,053,409 $(1,697,814) $2,884,083 $4,239,678
The amounts in the Inclusion of Equity Values in the tables above are derived from the amounts set forth in the following tables. The amounts reported in the total columns reflect rounding, which may result in slight variations when compared with the sum of the components listed in the tables:
PEO:
Year
Year End Fair
Value of Equity Awards
Granted During
the Covered Year
that are
Outstanding and
Unvested at the
Covered Year
End
Change in Fair
Value from
Last Day of
Prior Year to
Covered Year
End of
Unvested
Equity Awards
Vesting-Date
Fair Value of
Equity Awards
Granted During
the Covered
Year that Vested
During the
Covered Year
Change in Fair
Value from Last
Day of Prior
Year to Covered
Year End Equity
Awards that
Vested During
the Covered Year
Dividends/
Earnings Paid
on Awards in
the Covered
Year
Inclusion
of Equity
Values
2024
$7,620,370 $2,408,169 $0 $2,602,330 $65,301 $12,696,170
Non-PEO NEOs (Average):
Year
Year End Fair
Value of Equity Awards
Granted During
the Covered Year
that are
Outstanding and
Unvested at the
Covered Year
End
Change in Fair
Value from Last
Day of Prior
Year to Covered
Year End of
Unvested Equity
Award
Vesting-Date
Fair Value of
Equity Awards
Granted During
the Covered
Year that Vested
During the
Covered Year
Change in Fair
Value from Last
Day of Prior
Year to Covered
Year End Equity
Awards that
Vested During
the Covered Year
Dividends/
Earnings Paid
on Awards in
the Covered Year
Inclusion of
Equity
Values
2024
$1,673,782 $668,980 $0 $517,667 $23,655 $2,884,083
For the equity values included in the above tables, the valuation assumptions used to calculate fair values did not materially differ from those disclosed at the time of the grant.
(4)
The Peer Group TSR set forth in this table utilizes the Dow Jones U.S. Industrial Suppliers Total Stock Market Index, which we also utilize in the stock performance graph required by Item 201(e) of Regulation S-K of the Exchange Act included in our Annual Report. The comparison assumes $100 was invested for the period starting December 31, 2019, through the end of the listed year in the Company and in the Dow Jones U.S. Industrial Suppliers Total Stock Market Index, respectively. Historical stock performance is not necessarily indicative of future stock performance.
(5)
While we are required to identify adjusted ROIC as the CSM in accordance with Item 402(v) of Regulation S-K of the Exchange Act, adjusted ROIC and daily sales growth are the financial measures we consider the two most important in linking performance to compensation actually paid to the NEOs for the 2024 fiscal year to Company performance, as the Company’s overall NEO compensation structure is designed to drive profitable growth leading to shareholder value creation. The 2024 MIP financial metrics are modified for the Company’s current year planned foreign currency exchange rates used when setting initial targets resulting in total Company daily, organic constant currency sales of 4.5% and total Company adjusted ROIC of 41.4%.
Total Company adjusted ROIC and total Company daily, organic constant currency sales are non-GAAP financial measures. See Appendix B of this proxy statement for information regarding compensation and non-GAAP financial measures for year ended December 31, 2024. As it relates to Grainger’s prior year financial targets and result for its MIP and PSU grants, including the Company’s reconciliations of non-GAAP and other financial measures to the directly comparable GAAP measure, refer to the Company’s proxy statement on Form DEF 14A filed with the SEC on March 14, 2024.
       
Company Selected Measure Name Adjusted ROIC        
Named Executive Officers, Footnote
(1)
D.G. Macpherson was our PEO for each year presented. The individuals comprising the Non-PEO NEOs for each year presented are listed below.
2020
2021
2022
2023
2024
Thomas B. Okray
Deidra C. Merriwether
Deidra C. Merriwether
Deidra C. Merriwether
Deidra C. Merriwether
John L. Howard
Paige K. Robbins
Paige K. Robbins
Paige K. Robbins
Paige K. Robbins
Paige K. Robbins
John L. Howard
John L. Howard
Nancy L. Berardinelli-Krantz
Nancy L. Berardinelli-Krantz
Deidra C. Merriwether
Kathleen S. Carroll
Kathleen S. Carroll
Matthew E. Fortin
Jonny LeRoy
Robert F. O’Keef, Jr.
John L. Howard
Kathleen S. Carroll
       
Peer Group Issuers, Footnote
(4)
The Peer Group TSR set forth in this table utilizes the Dow Jones U.S. Industrial Suppliers Total Stock Market Index, which we also utilize in the stock performance graph required by Item 201(e) of Regulation S-K of the Exchange Act included in our Annual Report. The comparison assumes $100 was invested for the period starting December 31, 2019, through the end of the listed year in the Company and in the Dow Jones U.S. Industrial Suppliers Total Stock Market Index, respectively. Historical stock performance is not necessarily indicative of future stock performance.
       
PEO Total Compensation Amount $ 10,881,689 $ 10,160,673 $ 9,967,658 $ 9,015,594 $ 7,475,378
PEO Actually Paid Compensation Amount $ 15,759,913 23,002,860 14,293,346 16,301,335 14,661,338
Adjustment To PEO Compensation, Footnote
(3)
Compensation Actually Paid reflects the exclusions and inclusions of certain amounts for the PEO and the Non-PEO NEOs as set forth below. Equity values are calculated in accordance with FASB ASC Topic 718. Amounts in the Exclusion of Stock Awards and Option Awards column are the totals from the Stock Awards and Option Awards columns set forth in the Summary Compensation Table.
Year
Summary Compensation
Table Total
for Mr. Macpherson
Exclusion of Stock
Awards and Option
Awards for Mr. Macpherson
Total—Inclusion of
Equity Values for
Mr. Macpherson
Compensation
Actually Paid to
Mr. Macpherson
2024
$10,881,689 $(7,817,946) $12,696,170 $15,759,913
The amounts in the Inclusion of Equity Values in the tables above are derived from the amounts set forth in the following tables. The amounts reported in the total columns reflect rounding, which may result in slight variations when compared with the sum of the components listed in the tables:
PEO:
Year
Year End Fair
Value of Equity Awards
Granted During
the Covered Year
that are
Outstanding and
Unvested at the
Covered Year
End
Change in Fair
Value from
Last Day of
Prior Year to
Covered Year
End of
Unvested
Equity Awards
Vesting-Date
Fair Value of
Equity Awards
Granted During
the Covered
Year that Vested
During the
Covered Year
Change in Fair
Value from Last
Day of Prior
Year to Covered
Year End Equity
Awards that
Vested During
the Covered Year
Dividends/
Earnings Paid
on Awards in
the Covered
Year
Inclusion
of Equity
Values
2024
$7,620,370 $2,408,169 $0 $2,602,330 $65,301 $12,696,170
For the equity values included in the above tables, the valuation assumptions used to calculate fair values did not materially differ from those disclosed at the time of the grant.
       
Non-PEO NEO Average Total Compensation Amount $ 3,053,409 3,042,195 3,121,115 2,138,920 2,003,159
Non-PEO NEO Average Compensation Actually Paid Amount $ 4,239,678 4,822,536 3,736,729 2,891,203 3,002,624
Adjustment to Non-PEO NEO Compensation Footnote
(3)
Compensation Actually Paid reflects the exclusions and inclusions of certain amounts for the PEO and the Non-PEO NEOs as set forth below. Equity values are calculated in accordance with FASB ASC Topic 718. Amounts in the Exclusion of Stock Awards and Option Awards column are the totals from the Stock Awards and Option Awards columns set forth in the Summary Compensation Table.
Year
Average Summary
Compensation Table
Total for
Non-PEO NEOs
Average Exclusion
of Stock Awards
and Option Awards for
Non-PEO NEOs
Total—Average
Inclusion of
Equity Values for
Non-PEO NEOs
Average Compensation
Actually Paid to
Non-PEO NEOs
2024
$3,053,409 $(1,697,814) $2,884,083 $4,239,678
The amounts in the Inclusion of Equity Values in the tables above are derived from the amounts set forth in the following tables. The amounts reported in the total columns reflect rounding, which may result in slight variations when compared with the sum of the components listed in the tables:
Non-PEO NEOs (Average):
Year
Year End Fair
Value of Equity Awards
Granted During
the Covered Year
that are
Outstanding and
Unvested at the
Covered Year
End
Change in Fair
Value from Last
Day of Prior
Year to Covered
Year End of
Unvested Equity
Award
Vesting-Date
Fair Value of
Equity Awards
Granted During
the Covered
Year that Vested
During the
Covered Year
Change in Fair
Value from Last
Day of Prior
Year to Covered
Year End Equity
Awards that
Vested During
the Covered Year
Dividends/
Earnings Paid
on Awards in
the Covered Year
Inclusion of
Equity
Values
2024
$1,673,782 $668,980 $0 $517,667 $23,655 $2,884,083
For the equity values included in the above tables, the valuation assumptions used to calculate fair values did not materially differ from those disclosed at the time of the grant.
       
Compensation Actually Paid vs. Total Shareholder Return
PEO and Average NEO Compensation Actually Paid Versus Grainger TSR and Grainger TSR Versus Peer Group TSR,
2020-2024
[MISSING IMAGE: bc_peoavgvsgraingertsr-pn.jpg]
       
Compensation Actually Paid vs. Net Income
PEO and Average NEO Compensation Actually Paid
Versus Grainger Net Income, 2020-2024
[MISSING IMAGE: bc_peoavgvsnetincome-pn.jpg]
       
Compensation Actually Paid vs. Company Selected Measure
PEO and Average NEO Compensation Actually Paid
Versus Grainger Total Company ROIC, 2020-2024
[MISSING IMAGE: bc_peoavgvstotalroic-pn.jpg]
       
Total Shareholder Return Vs Peer Group
Total Shareholder Return: GWW vs. Dow Jones U.S. Industrial Suppliers Index
[MISSING IMAGE: lc_tsrgwwvsdowjones-pn.jpg]
       
Tabular List, Table
Fiscal 2024 Tabular List of Most Important Financial Performance Measures
The following table presents the financial performance measures that the Company considers to have been the most important in linking Compensation Actually Paid to our PEO and other NEOs in fiscal 2024 to Company performance. The measures in this table are not ranked; definitions for these terms can be found in Appendix B to this proxy statement.
Most Important Performance Measures
(3 to 7 metrics w/o ranking)
(1)
Adjusted ROIC—Total Company
Daily, Organic Constant Currency Sales
Share Gain—High-Touch Solutions—U.S.
Daily Sales—Endless Assortment
Adjusted Operating Margin—Total Company
(1)
The following are non-GAAP financial measures. See Appendix B of this proxy statement for information regarding non-GAAP financial measures, including reconciliations of non-GAAP financial measures to the most directly comparable GAAP financial measures.
       
Total Shareholder Return Amount $ 332 259 172 158 123
Peer Group Total Shareholder Return Amount 260 223 151 170 125
Net Income (Loss) $ 1,909,000,000 $ 1,829,000,000 $ 1,547,000,000 $ 1,043,000,000 $ 695,000,000
Company Selected Measure Amount 41.4 42.8 40.6 31.9 28.2
PEO Name D.G. Macpherson        
Measure:: 1          
Pay vs Performance Disclosure          
Name Adjusted ROIC        
Non-GAAP Measure Description
(5)
While we are required to identify adjusted ROIC as the CSM in accordance with Item 402(v) of Regulation S-K of the Exchange Act, adjusted ROIC and daily sales growth are the financial measures we consider the two most important in linking performance to compensation actually paid to the NEOs for the 2024 fiscal year to Company performance, as the Company’s overall NEO compensation structure is designed to drive profitable growth leading to shareholder value creation. The 2024 MIP financial metrics are modified for the Company’s current year planned foreign currency exchange rates used when setting initial targets resulting in total Company daily, organic constant currency sales of 4.5% and total Company adjusted ROIC of 41.4%.
Total Company adjusted ROIC and total Company daily, organic constant currency sales are non-GAAP financial measures. See Appendix B of this proxy statement for information regarding compensation and non-GAAP financial measures for year ended December 31, 2024. As it relates to Grainger’s prior year financial targets and result for its MIP and PSU grants, including the Company’s reconciliations of non-GAAP and other financial measures to the directly comparable GAAP measure, refer to the Company’s proxy statement on Form DEF 14A filed with the SEC on March 14, 2024.
       
Measure:: 2          
Pay vs Performance Disclosure          
Compensation Actually Paid vs. Other Measure
PEO and Average NEO Compensation Actually Paid
Versus Grainger Daily Sales Growth, 2020-2024
[MISSING IMAGE: bc_peoavgvsdailysalesgro-pn.jpg]
       
Other Performance Measure, Amount 4.5 9.2 16.5 12.8 3.5
Name Daily, Organic Constant Currency Sales        
Measure:: 3          
Pay vs Performance Disclosure          
Name Share Gain—High-Touch Solutions—U.S.        
Measure:: 4          
Pay vs Performance Disclosure          
Name Daily Sales—Endless Assortment        
Measure:: 5          
Pay vs Performance Disclosure          
Name Adjusted Operating Margin        
PEO | Equity Awards Adjustments          
Pay vs Performance Disclosure          
Adjustment to Compensation, Amount $ 12,696,170        
PEO | Aggregate Grant Date Fair Value of Equity Award Amounts Reported in Summary Compensation Table          
Pay vs Performance Disclosure          
Adjustment to Compensation, Amount (7,817,946)        
PEO | Year-end Fair Value of Equity Awards Granted in Covered Year that are Outstanding and Unvested          
Pay vs Performance Disclosure          
Adjustment to Compensation, Amount 7,620,370        
PEO | Year-over-Year Change in Fair Value of Equity Awards Granted in Prior Years That are Outstanding and Unvested          
Pay vs Performance Disclosure          
Adjustment to Compensation, Amount 2,408,169        
PEO | Change in Fair Value as of Vesting Date of Prior Year Equity Awards Vested in Covered Year          
Pay vs Performance Disclosure          
Adjustment to Compensation, Amount 2,602,330        
PEO | Dividends or Other Earnings Paid on Equity Awards not Otherwise Reflected in Total Compensation for Covered Year          
Pay vs Performance Disclosure          
Adjustment to Compensation, Amount 65,301        
PEO | Change In Fair Value As Of Vesting Date Of Awards Vested During Current Year [Member]          
Pay vs Performance Disclosure          
Adjustment to Compensation, Amount 0        
Non-PEO NEO | Equity Awards Adjustments          
Pay vs Performance Disclosure          
Adjustment to Compensation, Amount 2,884,083        
Non-PEO NEO | Aggregate Grant Date Fair Value of Equity Award Amounts Reported in Summary Compensation Table          
Pay vs Performance Disclosure          
Adjustment to Compensation, Amount (1,697,814)        
Non-PEO NEO | Year-end Fair Value of Equity Awards Granted in Covered Year that are Outstanding and Unvested          
Pay vs Performance Disclosure          
Adjustment to Compensation, Amount 1,673,782        
Non-PEO NEO | Year-over-Year Change in Fair Value of Equity Awards Granted in Prior Years That are Outstanding and Unvested          
Pay vs Performance Disclosure          
Adjustment to Compensation, Amount 668,980        
Non-PEO NEO | Change in Fair Value as of Vesting Date of Prior Year Equity Awards Vested in Covered Year          
Pay vs Performance Disclosure          
Adjustment to Compensation, Amount 517,667        
Non-PEO NEO | Dividends or Other Earnings Paid on Equity Awards not Otherwise Reflected in Total Compensation for Covered Year          
Pay vs Performance Disclosure          
Adjustment to Compensation, Amount 23,655        
Non-PEO NEO | Change In Fair Value As Of Vesting Date Of Awards Vested During Current Year [Member]          
Pay vs Performance Disclosure          
Adjustment to Compensation, Amount $ 0