Cisco rewards its top executives handsomely for their contributions to the company. Family members of these executives are also generously compensated for duties they also execute on Cisco’s behalf.
According to an SEC Schedule DEF14A filing on Sept. 24, 2015, Cisco employs or employed three relatives of recently-promoted Senior Vice President Rebecca Jacoby and a relative of recently-promoted Executive Vice President Chris Dedicoat. Cisco did not make such a disclosure last fiscal year, according to an SEC Schedule DEF14A filing from September, 2014.
Cisco's Audit Committee reviews transactions that may be “related-person transactions,” which are transactions between Cisco and related persons "in which the aggregate amount involved exceeds or may be expected to exceed $120,000 and in which a related person has or will have a direct or indirect material interest," the DEF14A filing states. A related person, according to the policy, is a director, executive officer, nominee for director, or a greater than 5% beneficial owner of Cisco’s common stock, in each case since the beginning of the last fiscal year, and their immediate family members.
Here’s the disclosure from Cisco’s Schedule DEF14A filing with the SEC:
A son of Executive Vice President, Worldwide Sales, Chris Dedicoat, is employed by Cisco as a partner account manager in Cisco’s finance organization based in the United Kingdom. Mr. Dedicoat’s son received total compensation of approximately $126,000 for fiscal 2015, calculated in the same manner as in the Summary Compensation Table. The total compensation includes salary, non-equity incentive plan compensation, commissions, and other compensation.
A sister of Senior Vice President and Chief of Operations, Rebecca Jacoby, is employed by Cisco as a vice president of global business services based in California. Ms. Jacoby’s sister received total compensation of approximately $1.24 million for fiscal 2015, calculated in the same manner as in the Summary Compensation Table. The total compensation includes salary, non-equity incentive plan compensation, stock awards and other compensation. Pursuant to a recent reorganization, beginning in fiscal 2016 Ms. Jacoby’s sister currently reports indirectly to Ms. Jacoby. To avoid any conflict of interest, Cisco appointed an independent person outside of Ms. Jacoby’s organization to handle decisions relating to her job duties and assignments, compensation and job performance evaluations.
A brother-in-law of Rebecca Jacoby was employed by Cisco as a program manager in Cisco’s supply chain organization during a portion of fiscal 2015. Ms. Jacoby’s brother-in-law received total compensation of approximately $149,000 for the portion of fiscal 2015 during which he was a Cisco employee, calculated in the same manner as in the Summary Compensation Table. The total compensation includes salary, bonus, non-equity incentive plan compensation and other compensation. Beginning in fiscal 2016 he is employed as a Cisco account manager for a company which provides contingent technology workers to Cisco in organizations not reporting to Ms. Jacoby. Cisco made payments to that company of approximately $35 million for the contingent technology workers for fiscal 2015.
A sister-in-law of Rebecca Jacoby is employed as an account executive by a company which provides management consulting services to Cisco. Ms. Jacoby’s sister-in-law was directly involved in transactions between Cisco and her employer for which Cisco paid a total of approximately $1 million during fiscal 2015, although her interest in those transactions was less than $120,000. Ms. Jacoby had no direct involvement in these transactions.
Cisco had no additional comment beyond the SEC filing.
Jacoby was Cisco’s CIO before her ascension to SVP and chief of operations in June. Dedicoat was elevated in June from his previous post as SVP for Europe, Middle East and Africa.
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