Cognizant Technology Solutions (CTSH) DEF 14ADefinitive proxy

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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

SCHEDULE 14A

Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934 (Amendment No. )

Cognizant Technology Solutions Corporation

(Name of Registrant as Specified In Its Charter)
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

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Proxy statement guide

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April 27, 2022

To our shareholders

The Board is pleased with Cognizant’s broad-based progress in 2021. Under the leadership of CEO Brian Humphries and his diverse management team, Cognizant executed a strategy that delivered full-year revenue of $18.5 billion, or year-over-year growth of 11% (10% in constant currency¹), the company’s strongest revenue growth since 2015.

Despite intensifying competition for talent across the globe, Cognizant increased its net headcount by 41,000. The company continues its focus on driving diversity and inclusion (“D&I”) throughout its organization of more than 330,000 associates. Doing so is not only the right thing to do but congruent with the company’s core values and essential to attracting and retaining top talent around the world.

During the year, Cognizant deployed $2.3 billion in capital, which included the return of capital to shareholders through share repurchases and dividends, as well as acquisitions. The company believes its capital deployment framework, which anticipates a balanced approach of M&A and return of capital, will support future growth and drive shareholder value.

Executive compensation
Following shareholder engagement in 2020 and 2021, some shareholders suggested that the company incorporate environmental and social metrics, including diversity and inclusion goals, in the executive compensation program design. The Compensation Committee evaluated the potential inclusion of such metrics in the 2022 program and approved the use of a gender diversity rate as a measure in its annual incentive program design.

Sustainable business
In the last year, the Board has continued its emphasis on Cognizant’s environmental, social, governance (“ESG”) agenda. Cognizant published an ESG report in June 2021, outlining its approach to integrating ESG considerations into its business strategy. The company followed that report by announcing in October 2021, as a milestone on the journey to become a lower-carbon business, the goal of achieving net zero emissions. Cognizant’s net zero roadmap calls for reducing absolute emissions by 50% from the company’s global operations and supply chain through operational measures by 2030, and reducing absolute emissions by 90% by 2040. The company plans to negate any remaining emissions in both timeframes by using carbon offsets. See page 25.

Building on its long commitment to social responsibility, Cognizant announced early in 2021 a five-year, $250 million philanthropic initiative to advance economic mobility, educational opportunity, diversity, equity, and inclusion as well as health and well-being in communities around the world. Being a socially responsible company also means responding to the larger contexts in which Cognizant operates.

In response to the escalating humanitarian crisis in Ukraine, Cognizant contributed $1 million to organizations delivering assistance across the region. The company joins the international community in hoping that a path to lasting peace can be found soon.

On behalf of my fellow Board members, we invite you to attend the 2022 annual meeting of shareholders and thank you for your continued support.

Sincerely,
MICHAEL PATSALOS-FOX Chair of the Board of Directors

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About Cognizant

Our Values How we work
	Start with a point of view	Seek data, build knowledge	Always strive, never settle	Work as one	Create conditions for everyone to thrive	Do the right thing, the right way

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Meeting notice and voting roadmap

You are invited to participate in Cognizant’s 2022 annual meeting. If you were a shareholder at the close of business on April 11, 2022, you are entitled to vote at the annual meeting. The agenda for the meeting and the Board’s recommendation with respect to each agenda item are set out below. Even if you plan to attend, we encourage you to submit your vote as soon as possible through one of the methods below.

John Kim Secretary

Logistics

The 2022 annual meeting will be a virtual meeting of shareholders conducted via a live webcast. We designed the format of the virtual annual meeting to ensure that our shareholders who attend the virtual annual meeting will be afforded comparable rights and opportunities to participate as they would at an in-person meeting. During the virtual annual meeting, you may ask questions and will be able to vote your shares electronically. To participate in the virtual annual meeting and access the list of shareholders, you will need the 16-digit control number included on your Notice of Internet Availability of Proxy Materials or on your proxy card. A complete list of shareholders will also be available for examination by any shareholder during the ten days prior to the annual meeting for a purpose germane to the meeting by sending an e-mail to our general counsel at the e-mail address set out on page 77 stating the purpose of the request and providing proof of ownership of our common stock. The shareholder list will also be available on the bottom of your screen during the 2022 annual meeting after entering your 16-digit control number on the Notice of Internet Availability or any proxy card that you received, or on the materials provided by your bank or broker.

Date	Tuesday, June 7, 2022
Time	Online check-in begins: 9:15 a.m. Meeting begins: 9:30 a.m. (all times U.S. Eastern Time)
Place	Via live webcast – please visit www.virtualshareholdermeeting.com/CTSH2022

Voting

Who can vote	Shareholders as of our record date, April 11, 2022, are eligible to vote
Internet	www.proxyvote.com
Telephone*	+1-800-690-6903
Mail	Sign, date and return the proxy card

*	The above phone number will work internationally but is only toll-free for callers within the U.S. and Canada.

Agenda

1	Proposal 1 Election of directors

Elect the following 11 directors to serve until the 2023 annual meeting of shareholders:

	Zein Abdalla		Brian Humphries
	Vinita Bali		Leo S. Mackay, Jr.
	Maureen Breakiron-Evans		Michael Patsalos-Fox
	Archana Deskus		Stephen J. Rohleder
	John M. Dineen		Joseph M. Velli
			Sandra S. Wijnberg

Board recommendation:

FOR each director nominee.

●	We have built an independent Board with broad and diverse experience and sound judgment that is committed to representing the long-term interests of our shareholders.

See Board Overview on pages 6 and 7, our director skills matrix on pages 10 and 11 and our director nominees’ biographies starting on page 13.►

Qualified	Our Board’s key qualifications
	7/11	Technology and Consulting Services
	5/11	Talent Management
	4/11	Security
	5/11	Regulated Industries
	7/11	Operations Management
	9/11	International Business Development
	6/11	Public Company Leadership
	8/11	Public Company Governance
	3/11	Finance, Accounting and Risk Management
Diverse	Our Board’s demographics
	•  5/11 born outside the United States
	•  6/11 worked overseas
	•  4/11 racially/ethnically diverse
	•  4/11 female
Independent	10/11 directors are independent with four of such directors appointed in the last two years
Engaged	98% weighted average attendance of director nominees at 2021 Board and committee meetings

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Board recommendation:  

FOR the approval, on an advisory (non-binding) basis, of our executive compensation.

See “Compensation discussion and analysis (CD&A)” on page 30 ►

Performance-driven and aligned with strategic priorities and shareholder interests		Cash ●Base salary provides a stable source of cash income at competitive levels ●Annual cash incentive (ACI) motivates and rewards achievement of short-term company financial objectives Equity ●Performance stock units (PSUs) incentivize shareholder return and reward achievement of long-term company financial objectives and performance of our common stock ●Restricted stock units (RSUs) reward continued service and long-term performance of our common stock		2021 Target direct compensation
Ambitious but attainable targets		Our performance-based compensation utilizes performance goals that are designed to be ambitious but attainable. In 2021, ACI was achieved at 166.1% of target (for corporate leaders; a portion of the business unit leaders’ results are derived from their business unit performance, resulting in ACI achievement payouts for Mr. Hyttenrauch and Mr. Nambiar of 132% and 124%, respectively). Our 2020/21 PSUs achieved at 88.5%; in addition, the three-year PSUs granted in 2020 and 2021 achieved at 200% as to the 2021 company financial targets.

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Corporate governance   >   Board overview

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Corporate governance   >   Board composition and refreshment

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Corporate governance   >   Board qualifications

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Director nominees Presented on the following pages are the 11 director nominees recommended by the Board for election at the 2022 annual meeting. Director attendance There were 11 meetings of the Board in 2021. Each director standing for election at the annual meeting attended at least 90% of the aggregate of (i) all meetings of the Board held during the period in which he or she served as a director and (ii) the total number of meetings held by the committees on which he or she served during the period, if applicable. Weighted average attendance of director nominees at 2021 meetings

98%

99%

95%

97%

96%

B

Board of Directors

A

Audit Committee

C

Compensation and Human Capital Committee

F

Finance and Strategy Committee

G

Governance and Sustainability Committee

Our corporate governance guidelines provide that directors are expected to attend the annual meeting of shareholders. For the 2021 annual meeting, Mr. Humphries acted as Chair and all of the other 10 then-current directors attended virtually.

Key governance practices Shareholder rights and engagement ✔Annual director elections / no classified Board ✔Proxy access ✔Shareholder right to call a special meeting (10% threshold) ✔Annual vote to ratify selection of independent registered public accounting firm ✔No poison pill Board of Directors ✔Majority of independent directors (10 of 11 director nominees) ✔Separate Board Chair and CEO positions since 2003 ✔Annual Board and committee self-assessments ✔Directors limited to service on no more than three other public company boards (one other board if the director is a public company CEO) ✔Majority voting in director elections ✔Regular executive sessions of independent directors ✔A director who experiences a material change in job responsibilities (other than retirement) is required to offer to resign ✔Annual review of skills, expertise, diversity and other characteristics of individual Board members as part of overall analysis of Board composition		Board member independence Each of our director nominees, other than our CEO, Mr. Humphries, has been determined by the Board to be an “independent director” under the rules of Nasdaq, which require that, in the opinion of the Board, such person not have a relationship that would interfere with the exercise of independent judgment in carrying out the responsibilities of a director. In addition, the Board determined that John N. Fox, Jr. was an “independent director” while he served on the Board through his retirement on June 1, 2021.
		Recent director appointment Stephen J. Rohleder, the one director nominee appointed to the Board since the 2021 annual meeting, was identified and evaluated through a director search process overseen by the Governance Committee and undertaken with the assistance of an independent director search firm. His appointment as a director in March 2022 was based on his extensive experience in the professional services industry and his experience as a leader in public companies.

12	Cognizant

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Corporate governance   >   Director nominees

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Corporate governance   >   Director nominees

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Corporate governance   >   Director nominees

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Corporate governance   >   Board structure and operations

Board structure and operations

Recent committee appointments

Archana Deskus Chief Information Officer of PayPal	Stephen J. Rohleder Former Group Chief Executive, North America and Chief Operating Officer of Accenture plc
In December 2021, Ms. Deskus was appointed to the Management Development and Compensation Committee (now known as the Compensation and Human Capital Committee).	In April 2022, Mr. Rohleder was appointed to the Finance and Strategy Committee.

Changes in Board and committee responsibilities
On March 1, 2022, the Board determined that it desired to elevate the responsibility oversight for certain critical topics from the committees that had previously overseen such matters to the full Board.

The information on the next two pages reflects these changes in oversight responsibility.

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Board The Board exercises its oversight responsibilities both directly and through its committees. The same oversight structure is utilized with respect to the company’s enterprise risk management (“ERM”) program. The Board believes that its role in the oversight of the company, including its business, strategy and risks, complements our current Board leadership structure, with a strong independent Chair, as well as our committee structure, as it allows our four standing Board committees to play an active role in the oversight of the actions of management, including with respect to identifying risks and implementing effective risk management policies and controls. Meetings in 2021: 11 Weighted average 2021 attendance of director nominees: 98% Recent key focus areas ●Strategic priorities   ●Leadership transitions   ●Mergers and acquisitions   ●Ongoing response to COVID-19 pandemic   ●IT and security modernization   ●Attrition and evolving employee expectations			Committees of the Board
			Audit Committee Meetings in 2021: 14 Weighted average 2021 attendance of director nominees: 99%		Key responsibilities and areas of risk oversight ●Financial statements and publicly reported financial information   ●Internal controls over financial reporting   ●Company’s independent registered public accounting firm, including appointment, qualifications, independence and performance   ●Internal audit   ●Ethics and compliance   ●Enterprise risk management program   ●Security (including cybersecurity) and data privacy risks   ●Tax planning and strategy   ●Third party risks   ●Business continuity management
			Finance and Strategy Committee (“Finance Committee”) Meetings in 2021: 6 Weighted average 2021 attendance of director nominees: 97%		Key responsibilities and areas of risk oversight ●Assisting the Board with respect to corporate plans, strategies and objectives   ●Targeted financial model   ●Capital structure and allocation   ●Dividend policies and stock repurchase programs   ●Enterprise resource planning and management   ●Growth and scalability of corporate processes and systems   ●Assisting the Board with respect to mergers and acquisitions strategy and execution   ●Treasury matters, including hedging strategies’   ●Service delivery   ●Insurance
			Compensation and Human Capital Committee (“Compensation Committee”) Meetings in 2021: 5 Weighted average 2021 attendance of director nominees: 95%		Key responsibilities and areas of risk oversight ●Evaluation and compensation of the CEO and other executive officers   ●Director compensation recommendations to the Board   ●Performance-based compensation arrangements   ●Equity-based compensation plans   ●Employment and severance agreements and other arrangements with executive officers   ●General talent engagement   ●Diversity and inclusion   ●Assessment of shareholder “say-on-pay” and “say-on-pay” frequency votes   ●Stock ownership guidelines   ●Clawback policy   ●Investor Relations
			Governance and Sustainability Committee (“Governance Committee”) Meetings in 2021: 8 Weighted average 2021 attendance of director nominees: 96%		Key responsibilities and areas of risk oversight ●Nominations to the Board and Board committees, including evaluation of any shareholder nominees   ●Director independence recommendations to the Board   ●Annual Board self-evaluation process   ●Macro environment and geo-political risks, including immigration law changes   ●Legal and regulatory risks, including intellectual property Reviewing corporate governance structure and practices, including the company’s corporate governance guidelines   ●Public affairs and public policy initiatives   ●ESG strategy, initiatives and policies

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Corporate governance   >   Board structure and operations

					Management
Recent activities and key focus areas ●Reviewing and approving the 2021 financial statements and disclosure enhancements   ●Reviewing and selecting the independent auditor for the year ending December 31, 2022   ●Overseeing the internal audit department’s annual audit plan and budget   ●Overseeing the company’s continued IT and security modernization agenda   ●Overseeing material litigation and potential litigation   ●Overseeing compliance with legal and regulatory requirements, as well as the company’s code of ethics		Audit Committee financial experts and financial literacy Ms. Breakiron-Evans and Ms. Wijnberg are “audit committee financial experts” (per SEC rules), and all members of the committee can “read and understand fundamental financial statements” (per Nasdaq rules).			Management is responsible for the day-to-day management of the company, including its business, strategy execution and risk management. As part of the ERM program and committee oversight responsibilities under the committee charters, management provides regular updates to the Board and relevant committees. Committee charters Each of the board’s four standing committees — the Audit Committee, Finance Committee, Compensation Committee and Governance Committee — operates under a charter that has been approved by the Board and is available on the company’s website. See “Helpful Resources” on page 77.
Recent activities and key focus areas ●Overseeing the capital structure and allocation program, with approximately $1.3 billion in share repurchases and dividends in 2021 (see page 3)   ●Overseeing the deployment of $1 billion in capital in 2021 for 7 acquisitions aligned with our strategic priorities (see page 3)   ●Overseeing tax strategy and planning, including repatriations   ●Real estate strategy
Recent activities and key focus areas ●Resumption of typical compensation program in 2021 following unusual adjustments to 2020 targets in light of the unanticipated business impact of the COVID-19 pandemic   ●In early 2021, granting additional equity awards to select officers for retention purposes   ●Undertaking a detailed review of our management development program (prior to the change in responsibilities discussed on page 19), talent engagement and diversity and inclusion efforts, including the addition of a gender diversity metric to the 2022 ACI   ●Monitor attrition prevalent in industry and oversee management’s efforts to reduce and mitigate its impact on our organization		Compensation Committee interlocks and insider participation During the year ended December 31, 2021, Mses. Bali and Deskus, Messrs. Mackay, Patsalos-Fox and Velli and Mr. John N. Fox, Jr., who served on our Board through June 1, 2021, served on the Compensation Committee. No member of the Compensation Committee was or is a current or former officer or employee of the company or any of its subsidiaries. None of our executive officers serves as a member of the board of directors or compensation committee of any entity that has one or more of its executive officers serving as a member of Cognizant’s board or Compensation Committee.
Recent activities and key focus areas ●Overseeing the Board’s 2021 self-evaluation process (see page 8)   ●Reviewing the company’s exposure to potential changes in immigration laws and regulations   ●Reviewing and approving the 2021 political spend disclosures and 2022 U.S. political contributions budget (only committee members who are U.S. citizens)   ●Overseeing the company’s enhancement of its ESG program and disclosures		●Overseeing the company’s efforts to empower and promote women leaders, as well as other diversity and inclusion efforts (see page 24)   ●Overseeing the company’s development of its net zero emissions goal and progress on the roadmap towards achieving that goal (see page 25)

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Board engagement activities

Shareholder engagement
Our Board values the input of our shareholders. It receives quarterly or more frequent updates on shareholder communications and is directly involved in responding to communications where appropriate. It also engages in a formal governance-focused engagement process where select directors meet directly with a number of our large shareholders to solicit the input of shareholders on a proactive basis. We consider the valuable feedback and perspectives of our shareholders, which helps inform our decisions and our strategy, when appropriate. The topics in our formal engagement discussions with our large shareholders mostly focused on the company’s strategy, management engagement with the Board, talent, the progress and goals of our ESG program and other governance topics.

Winter 2021-2022 formal engagement
		Attendance
		Our Board Chair and Compensation Committee Chair led the engagement process and meetings with shareholders, supported by representatives from the company’s legal and investor relations functions.

Shareholder proposals at annual meeting
The Board reviews and takes positions with respect to any shareholder proposals submitted for consideration at the annual meeting. The Board also evaluates the voting results from the annual meeting, including with respect to shareholder proposals.

Employee engagement and global delivery operations review
Travel to India
Typically our Board travels to India, where two-thirds of our employees and the core of our global delivery operations are located, every other year. Over the course of a week, directors meet with employees in a variety of forums, tour a number of our global delivery centers and engage in an in-depth review of our people and operations in India. The Board’s most recent visit to India was in February 2020 and the 2022 visit has been delayed due to the COVID-19 pandemic. The Board hopes to return to India in 2023.

1-on-1 meetings
At our quarterly in-person Board meetings, our directors engage in 1-on-1 meetings, typically over breakfast or lunch, with members of management and high-performing employees. With quarterly Board meetings often held virtually since the start of the COVID-19 pandemic, the 1-on-1 meetings have often been held via videoconference.

Keeping up-to-date with trends and legal developments
NACD membership
The company maintains a subscription for Board members to the National Association of Corporate Directors (“NACD”), a recognized authority focused on advancing board leadership and establishing leading boardroom practices. Our Board members attend programs sponsored by the NACD as well as events and summits sponsored by various universities, accounting firms, law firms and other governance firms, and speak on various topics at these events.

Corporate governance policymaking
Certain of our Board members are actively involved in shaping policy around public company governance. For example, Ms. Breakiron-Evans, one of our Audit Committee financial experts, sits on the NACD Audit Committee Chairs Advisory Board, a group of Fortune 500 audit committee chairs that meets with Public Company Accounting Oversight Board (“PCAOB”) members, the SEC Chief Accountant and the head of the Center for Audit Quality.

Updates from advisors
Our Board members receive periodic updates on corporate governance and executive compensation developments, accounting standards changes and various legal and other topics from internal and external counsel, our independent registered public accounting firm and third-party advisors.

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Corporate governance   >   Sustainable outcomes

Sustainable outcomes

We strive to embed environmental, social and governance (“ESG”) considerations into our thinking, decisions, and actions.

Supporting our people

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Diversity and inclusion
At Cognizant, we are working every day to create conditions for everyone to thrive. We continue to drive diversity and inclusion throughout our organization to unlock the insights, imagination and innovation of our associates and reflect the diversity of our clients and communities. We have diversity and inclusion training and other programs in every geography where our employees are located, fostering inclusivity throughout our organization and culture. In recognition of our efforts, we are proud to have been named a 2021 top employer in 17 countries. Mr. Humphries also recently joined the Valuable 500, a CEO community working to revolutionize disability inclusion through business leadership and opportunity.

One of the ways we are elevating the experience of work for women is through our global Women Empowered (“WE”) affinity group. WE is committed to developing more women leaders at all levels of our company, providing career growth and leadership development opportunities, and building a community of women across all industries in business and technology. For example, our women’s global leadership development program, Propel, is designed to help shape and mobilize the careers of women in leadership roles across our organization. In 2021, the company reached a critical milestone, exceeding its pledge to put 1,000 women leaders globally through the Propel program.

We strive to provide our diverse talent with the support and tools needed to thrive through affinity groups in our organization. Executive Committee sponsors and executive leaders help shape the strategy and direction of each group.

Board diversity matrix (as of April 27, 2022)
As part of our commitment to diversity, we prioritize diversity on our Board of Directors.

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Corporate governance   >   Sustainable outcomes

Running a responsible business
Board and management oversight
Running a responsible business starts with our Board and management setting a cultural “tone at the top”. Our Board takes an active role in the oversight of our environmental and sustainability initiatives, ethics and compliance and risk management. Our management promotes and monitors implementation of such initiatives and provides regular progress reports to the Board.

Environmental impact and sustainable business
Our Governance and Sustainability Committee is responsible for overseeing our ESG program. We have continued to undertake investments to enhance our ESG program to, among other things, set a greenhouse gas emissions reduction goal and provide more comprehensive ESG disclosures to our shareholders. In 2021, we published our ESG report incorporating the most applicable elements of key third-party ESG reporting frameworks, including the Global Reporting Initiative (GRI), Sustainability Accounting Standards Board (SASB) standards and Task Force on Climate-related Financial Disclosures (TCFD) Recommendations. We outlined the company’s approach to integrating ESG considerations into our business strategy while navigating an ever-changing world, including addressing developments like the COVID-19 pandemic and climate change. Learn more about our ESG program at https://www.cognizant.com/us/en/about-cognizant/esg; information which appears on the website is not part of, and is not incorporated by reference into, this proxy statement.

Emissions goal
In addition, the company announced in 2021 it aims to achieve net zero emissions, a new milestone set out as part of the company’s ongoing ESG agenda to become a more sustainable business. We laid out a net zero roadmap that calls for reducing absolute emissions by 50 percent from the company’s global operations and supply chain by 2030, and by 90 percent by 2040 with plans to negate any remaining emissions, in both the 2030 and 2040 goals, by using carbon offsets.

Verified: Cognizant believes third-party validation is an important hallmark of a goal’s ambition and legitimacy. In the first quarter of 2022, Cognizant submitted its net zero goal to the Science Based Targets initiative (SBTi).

Ethics and compliance
Our commitment to customers, employees, shareholders and society is to act with integrity at all times. This guides everything we do — the way we serve our clients and the work we do to help them build better businesses. We believe it is critical to maintain the highest ethical standards.

Our code of ethics applies to all of our directors, officers and employees and is available on our website. See “Helpful resources” on page 77. We post on our website all disclosures that are required by law or Nasdaq rules concerning any amendments to, or waivers from, any provision of our code of ethics. In order to foster a culture of ethics and compliance, we conduct annual trainings for employees on regulatory compliance topics such as global data privacy and anti-bribery. We also make a compliance hotline available to our employees. The hotline is serviced by a third-party provider that is available by phone or online 24 hours a day, 7 days a week to help ensure any compliance concerns can be reported and addressed in a timely and appropriate manner.

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Supporting our communities

At Cognizant, we care deeply about unlocking human potential and living out our purpose to improve everyday life. We know that our success depends on delivering value to all of our stakeholders. We contribute to the progress and prosperity of communities across the globe through our corporate foundations, philanthropic initiatives and associate volunteering efforts. Building on our longstanding investments in corporate social responsibility, Cognizant announced a new, five-year $250 million initiative in 2021 to advance economic mobility, educational opportunity, diversity and inclusion, and health and well-being in communities around the world. Learn more about our work to build resilient communities around the globe at https://www.cognizant.com/impact; information which appears on the website is not part of, and is not incorporated by reference into, this proxy statement.

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Corporate governance   >   Share ownership

Share ownership

Common stock and total stock-based holdings table
The following table sets forth the Cognizant stock-based holdings of our directors, named executive officers for fiscal 2021 (“NEOs”), and directors and executive officers as a group. Information is as of April 5, 2022. The table also sets forth the stock-based holdings of beneficial owners of more than 5% of our common stock as of December 31, 2021. Unless otherwise indicated, the address for the individuals below is our address.

Each of our directors and NEOs owns less than 1% of the total outstanding shares of our common stock. The current directors and executive officers as a group do not own more than 1% of the total outstanding shares.

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Director compensation

Director compensation vs. peer group
For purposes of establishing 2021 non-employee director compensation, the Compensation Committee engaged Pay Governance, LLC (“Pay Governance”), an independent executive compensation advisory firm, to review all elements of director compensation, benchmark such compensation in relation to other comparable companies with which we compete for board talent and provide recommendations to ensure that our director compensation program remains competitive. Pay Governance benchmarked our director compensation against the same group of technology-related firms used by Pay Governance in preparing its recommendations to the Compensation Committee for executive officers for 2021. See “Peer group review” on page 33.

The Compensation Committee considered the benchmarking data and recommendations of Pay Governance in recommending to the Board the cash and stock-based compensation of non-employee directors that became effective following the 2021 annual meeting. Based on the 2021 analysis, the Board approved an increase to the annual cash retainer for the members of the Finance and Strategy Committee from $10,000 to $15,000 and the annual cash retainer for the members of the Governance Committee from $7,500 to $10,000.

DIRECTOR STOCK OWNERSHIP GUIDELINES

Under our stock ownership guidelines, each non-employee director is required over time to hold a number of shares with a value, measured as of the time the revised guidelines were put in place (March 2017) or, for later joining directors, the time a director joins the Board, equal to five times the annual cash retainer received by non-employee directors i.e., $450,000 in shares of common (stock). Compliance with the guidelines is required within five years of a director joining the Board. As of April 5, 2022, all of our directors were in compliance with our stock ownership guidelines.

NO HEDGING, SHORT SALES, MARGIN ACCOUNTS OR PLEDGING All directors are subject to the same insider trading policies of the company that apply to employees and provide for:

× No hedging or speculation with respect to Cognizant securities × No short sales of Cognizant securities × No margin accounts with Cognizant securities × No pledging of Cognizant securities

See “Hedging, short sale, margin account and pledging prohibitions” on page 48 for additional information on these restrictions.

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Corporate governance   >   Director compensation

Director compensation table
The following table sets forth certain information regarding the compensation of each of our non-employee directors who served during 2021. The table also sets forth the aggregate number of RSUs and the aggregate number of stock options held by each such non-employee director on December 31, 2021. John N. Fox, Jr. did not stand for re-election at our 2021 annual meeting of stockholders and, accordingly, he did not receive any compensation in 2021.

Deferral of restricted stock units
In late 2020, non-employee directors were provided an option to elect to defer settlement of RSUs that were granted in 2021. The following table sets forth for 2021 the two deferral options available and the directors that elected such deferral options.

Delinquent section 16(a) reports

Section 16(a) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) requires our directors, executive officers and holders of more than 10% of our voting stock to file with the SEC initial reports of ownership and reports of changes in ownership of our common stock or other equity securities. Based on a review of those forms provided to us and any written representations, we believe that during the year ended December 31, 2021, our directors, executive officers and holders of more than 10% of our voting stock filed the required reports on a timely basis under Section 16(a), except for a Form 4 for Ursula Morgenstern related to four transactions, which was filed one day after the filing deadline.

Related person transactions

Under the Audit Committee’s charter, the committee is responsible for reviewing and approving all transactions between the company and any related person that are required to be disclosed pursuant to Item 404(a) of Regulation S-K. Related persons include our directors and executive officers, certain of our shareholders and immediate family members of the foregoing. The company’s legal staff is primarily responsible for monitoring and obtaining information from our directors and executive officers with respect to potential related person transactions, and for then determining, based on the facts and circumstances, whether the related person has a direct or indirect material interest in any transaction with us. Each year, to help our legal staff identify related person transactions, we require each of our directors, director nominees and executive officers to complete a disclosure questionnaire identifying any transactions with us in which the director or officer or their family members have an interest. In addition, our code of ethics requires all directors, officers and employees who may have a potential or apparent conflict of interest to, in the case of employees, notify our chief compliance officer, or, in the case of directors and executive officers, notify our general counsel. There have been no related person transactions since January 1, 2021.

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Compensation

Compensation discussion and analysis (CD&A)

This compensation discussion and analysis section describes the general objectives, principles and philosophy of the company’s executive compensation program, focused primarily on the compensation of our named executive officers for fiscal 2021 (the “NEOs”).

Compensation program objectives

The Compensation Committee designed the 2021 executive compensation program with the objectives and key features to meet those objectives as set out below.

The Compensation Committee believes that the design of the compensation program, including having the appropriate mix of compensation elements and performance metrics and targets, has a significant impact on driving company performance.

		1				2
Program objectives		Alignment with corporate strategies Ensure compensation program incentives are aligned with our corporate strategies and business objectives				Short and long-term performance objectives Tie a substantial portion of compensation to achieving both short and long-term performance objectives that enhance shareholder value
How we get there		Our strategic priorities				2021 ACI 2021/23 PSUs
		1	Accelerating Digital
		2	Globalizing Cognizant
		3	Increasing our Relevance to Clients
		4	Repositioning the Cognizant Brand
		We set performance metrics for our performance-based compensation program that align with our strategic priorities and that we believe are aspirational but achievable. In 2021, the performance metrics included constant currency revenue growth, profitability (measured through adjusted income from operations and adjusted diluted earnings per share (“EPS”)) and total shareholder return relative to a peer group of companies (“relative TSR”) ( see pages 34 to 40).				A substantial percentage of our NEO compensation is performance-based. This is divided between (i) annual cash incentive (“ACI”), which measures performance over a one-year period and rewards achievement of short-term company financial objectives, and (ii) performance stock units (“PSUs”), which measure performance over a multi-year period and reward long-term company financial objectives and relative TSR ( see pages 34 and 35).

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Compensation > CD&A > Compensation program objectives

Key compensation program features

3	4	5	6
Long-term continued employment Provide an incentive for long-term continued employment with our company	Balanced mix Create an appropriate balance between current and long-term compensation and between performance and non-performance-based compensation	Competitive Provide competitive compensation packages in order to attract, retain and motivate top executive talent	No unnecessary risk-taking Ensure that compensation arrangements do not encourage unnecessary risk-taking
Long-term equity	Performance-based	Peer group positioning
A substantial percentage of our NEOs’ target direct compensation consists of long-term equity: (i) restricted stock units (“RSUs”), which vest quarterly over a 3-year period, to reward continued service and long-term performance of our common stock, and (ii) PSUs that have a 3-year performance period with vesting shortly thereafter ( see pages 34 and 35).	Our NEOs’ target direct compensation includes current compensation in the form of cash, divided between base salary and ACI, and long-term compensation in the form of equity, divided between PSUs and RSUs. Both current and long-term compensation are mixed between stable (base salary and RSUs) and performance-based (ACI and PSUs) compensation ( see pages 34 and 35).	To ensure our compensation remains competitive, the Compensation Committee engaged Pay Governance as its independent consultant in 2021 and prior years to review and benchmark the compensation we provide relative to our peer group and other market data. Our 2021 peer group was comprised of 17 technology, software and professional service companies selected based on industry, comparable business operations and scale ( see page 33).	We set stock ownership guidelines to help mitigate potential compensation risk and further align the interests of our NEOs with those of shareholders ( see page 48). We also create a balance between performance and non-performance-based compensation and set performance targets that we believe are aspirational but achievable ( see pages 34 to 40).

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Compensation setting process

Shareholder engagement and the impact of COVID-19
As part of our annual shareholder engagement program (see page 22), we solicit feedback from our shareholders on our executive compensation program. In 2019, we received a number of suggestions from shareholders (described in our 2020 proxy statement) that we incorporated into the design of our 2020 executive compensation program and continue today.

For 2020 (and continuing in 2021), the Compensation Committee made significant revisions to the company’s performance-based compensation structure to better align with the company’s strategy, peer group, competitor and industry practices, the recommendations of the committee’s independent compensation consultant and feedback from shareholders. Based on the positive feedback received from shareholders on the changes made to the 2020 executive compensation program and the Compensation Committee’s view that the revised program design was achieving its objectives, the committee made no significant changes to the design of the program for 2021. These changes included the following, which may assist in understanding prior years’ compensation for our NEOs in various charts and graphs throughout this proxy statement:

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Compensation    >   CD&A   >   Compensation setting process

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Primary compensation elements

The relative TSR component is measured over the full 3-year performance period, with payout with respect to the metric capped at 100% in the event the TSR of the company’s common stock on an absolute basis of share price growth and dividends over the performance period is negative. The relative TSR target was set at the 50^th percentile vis-à-vis the comparator group of companies. The maximum possible number of PSUs that may vest is 200% of target.

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Compensation   >   CD&A   >   Primary compensation elements

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Performance-based compensation – performance by metric

The graphs below show actual company performance versus the corresponding performance targets for the company’s performance-based compensation elements.

Presentation notes

Revenue
(in billions)

Adjusted income from operations
(in millions)

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Compensation   >   CD&A   >   Performance-based compensation – performance by metric

Non-GAAP / adjusted diluted earnings per share (EPS)

Total shareholder return (TSR) and relative TSR
To incentivize shareholder return, absolute TSR and relative TSR were utilized as performance metrics for the PSUs awarded to Mr. Humphries in 2019 upon his joining the company and relative TSR was utilized as a performance metric for all PSU awards granted in 2020 and 2021.

Relative TSR:
Peer Group for Relative TSR on Annual PSUs: S&P 500 Information Technology Index + Additional Competitors (Capgemini, CGI, EPAM Systems, Genpact, HCL, Infosys, Tata Consulting Services and Wipro)

Peer Group for Relative TSR on 2019/23 CEO PSUs (New Hire): S&P 500 Information Technology Index

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Performance-based compensation – performance by award

The information below shows the awards granted in 2021 and prior years with performance periods covering 2021.

Presentation notes

●	Revenue targets are initially set in constant currency. All targets are initially set assuming no acquisitions beyond those that have been announced by the company at the time of target setting.
●	For comparability with actual company results, targets presented herein were adjusted as follows:
	●	Revenue targets were adjusted to include the impact of foreign currency exchange movements and revenue generated by acquisitions that were announced following the target setting process
	●	Adjusted income from operations and adjusted diluted EPS targets were each adjusted by results generated by acquisitions that were announced following the target setting process and, in 2021, by the impact of the 2021 class action settlement loss
●	Target increases in the tables are as initially set by the Compensation Committee and assume no acquisitions beyond those that had been announced at the time of target setting.
●	Achieved increases (decreases) reflect the following adjustments:
	●	Revenue increase (decrease) achieved is on a constant currency basis and was adjusted to exclude revenue generated by acquisitions that were announced following the target setting process
	●	Adjusted income from operations and adjusted diluted EPS increase (decrease) achieved were each adjusted by results generated by acquisitions that were announced following the target setting process and, in 2021, by the impact of the 2021 class action settlement loss
●	Adjusted income from operations and adjusted diluted EPS are not measurements of financial performance prepared in accordance with GAAP. See “Forward-looking statements and non-GAAP financial measures” on page 71 for more information.
●	Achievement shown for 2021 ACI applies to corporate leaders; a portion of the business unit leaders’ results are impacted by their business unit performance; achievement levels for Mr. Hyttenrauch and Mr. Nambiar were 132% and 124%, respectively.

Performance awards paid in early 2022:

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Compensation   >   CD&A   >   Performance-based compensation – performance by award

In addition, the Company had the following PSUs related to prior performance periods and that would have vested and been paid in 2021 or 2022, but did not vest due to 0% achievement:

PSUs for future payment (awards made through 2021):

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Compensation   >   CD&A   >   Compensation by NEO

Compensation by NEO

This section includes compensation information for and provides an overview of the compensation decisions made with respect to our NEOs.

Three views of compensation
To assist shareholders in understanding the compensation arrangements for our NEOs, we provide the following three views of compensation:

Target Direct Compensation – The Compensation Committee utilizes target direct compensation to review, evaluate and make decisions, typically early in the year, with respect to the compensation of our NEOs. This view is intended to capture the annual compensation that would be delivered to an NEO in a theoretical, steady environment where the same annual compensation was granted in multiple years and the company’s performance was at target across all such years. The Compensation Committee believes this view is most appropriate for its decision-making, including evaluation against the compensation practices of comparable companies with which we compete for talent, as it is designed to capture the annual compensation an NEO would be expected to earn, assuming company performance at target, based on the decisions of the Compensation Committee in the year of such decision. Target direct compensation excludes additional cash and equity awards that are made for new hires, retention or other purposes that are not intended to be recurring.

The table above summarizes the manner in which the various compensation elements for a given year are included in target direct compensation, SEC compensation and realized compensation. See Executive Compensation Tables beginning on page 51 for additional information regarding these items.

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Brian Humphries CEO				Key responsibilities and career highlights Mr. Humphries joined Cognizant as our CEO on April 1, 2019. In his role as CEO, Mr. Humphries sets the company’s strategic direction, promotes the company’s client-first culture and focuses on ensuring the company’s sustainable growth and driving long-term shareholder value. Prior to joining Cognizant, he was CEO of Vodafone Business where he was responsible for the strategy, solution development, sales, marketing, partnerships and commercial and financial success of Vodafone Business, a division of Vodafone Group, one of the world’s largest telecommunications companies. Vodafone Business accounted for nearly a third of Vodafone Group’s service revenue, with approximately €12 billion in sales globally, during Mr. Humphries’ tenure as CEO. Prior to Vodafone, Mr. Humphries held a variety of executive roles at technology companies Dell Technologies and Hewlett-Packard.
Age 48 Education University of Ulster, Northern Ireland - B.A. Cognizant Tenure 3 years

Committee assessment and target direct compensation The Compensation Committee, at its meeting in February 2021, evaluated Mr. Humphries’ performance during 2020 and the prior year and the compensation information provided by Pay Governance for CEOs in the company’s peer group. The Compensation Committee considered his performance as CEO in 2020, the company’s growth and transformation initiatives and strategic priorities, and the compensation information for CEOs in the peer group for 2021 (see “Peer group review” on page 33). Based on these considerations, the Compensation Committee determined that his target direct compensation for 2021 should be increased to approximately $17,700,000 (31% increase vs. 2020) to reflect performance in his second year as CEO and compensation trends for CEOs in the peer group. The specific components of Mr. Humphries’ 2021 target direct compensation were as follows: (i) base salary of £925,000 (approximately $1,230,000; a 16% increase vs. 2020), (ii) ACI target of 2x base salary (£1,850,000, or approximately $2,460,000; a 16% increase vs. 2020), (iii) PSUs of $8,400,000 (35% increase vs. 2020) and (iv) RSUs of $5,600,000 (35% increase vs. 2020). The 2021/23 PSUs granted in 2021 had the same metrics, targets and performance period as such PSUs granted to the other NEOs, as compared to the 2019/23 CEO PSUs (New Hire) granted in 2019 that were specific to him. These increases reflect the assessment of Mr. Humphries’ accomplishments in aligning the Company behind a clear purpose and vision, investing in ESG, enhancing diversity and inclusion initiatives, refreshing the leadership team, reinvigorating the Company’s commercial momentum, and investing in the future, both organically and through a clearly defined acquisition strategy. In addition, Mr. Humphries led the company through a ransomware attack and began executing a significant investment strategy to bolster and modernize the company’s IT and security infrastructure. This leadership and growth strategy allowed the company to reach $18.5 billion in revenue and return $1.3 billion to shareholders through share repurchases and dividends in 2021. SEC compensation Mr. Humphries’ SEC compensation in 2021 was higher than in 2020 primarily due to the increase in his base salary (and corresponding impact on ACI), the payment of his 2021 ACI award at 166.1% of target (compared to 2020 when the payment was 85% of target), the inclusion of PSUs to vest in future years, and the grant of PSUs and RSUs with higher target values (and therefore higher fair market values on the date of grant). The grant date fair value of the PSUs required to be included in 2020 and 2021 SEC compensation is slightly higher than the target award value due to the relative TSR component being an award with a “market condition” under applicable accounting rules. Realized compensation In 2021, Mr. Humphries’ realized compensation remained lower than his target direct compensation primarily because his 2021 PSU and RSU grants are much higher in value than his prior awards, but are largely expected to vest in future periods. His realized compensation for 2020 was substantially lower than his target direct compensation as all of the PSU awards made in 2019 and 2020 are expected to vest in future periods. His 2021 realized compensation consisted principally of his base salary, 2021 ACI award payout at 166.1% of target and quarterly vestings of RSUs in the aggregate amount of approximately $4,304,500. In 2020, a portion of his realized compensation came from the vesting of buy-out awards granted upon joining the company. Certain numbers shown in the graphs above were converted to US$ based on a £1 = $1.28 exchange rate, the twelve-month average for fiscal year 2020 and a £1 = $1.33 exchange rate, the twelve-month average for fiscal year 2021.

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Compensation   >   CD&A   >   Compensation by NEO

Jan Siegmund					Key responsibilities and career highlights Mr. Siegmund leads the company’s worldwide financial planning and analysis, accounting and controllership, tax, treasury and internal audit functions. He also oversees corporate development, investor relations and enterprise risk management. Prior to joining Cognizant in September 2020, he was the CFO for Automatic Data Processing (ADP), a $14 billion in annual revenue global human capital management technology and services provider. He began his career at McKinsey & Company.
CFO
Age	Cognizant Tenure	Public Company Boards
57	2 years	The Western Union
		Company (WU)
Education
Technical University Karlsuhe - M.A.
University of California, Santa Barbara - M.A.
Technical University of Dresden, Germany - Doctorate

Committee assessment and target direct compensation Mr. Siegmund was selected by the Board to serve as the company’s CFO based on his extensive financial experience as a senior executive in the technology sector. In connection with his appointment as CFO, the Compensation Committee reviewed and approved his compensation arrangements after considering compensation information provided by Pay Governance for CFOs in the company’s peer group (see “Peer group review” on page 33) and other information on compensation arrangements for new CFOs. The Compensation Committee, at its meeting in February 2021, evaluated Mr. Siegmund’s performance during 2020 and the updated information provided by Pay Governance for CFOs in the company’s peer group. The Compensation Committee considered his performance as CFO, along with his relatively short tenure with the company, and determined that his target direct compensation for 2021 should remain consistent with a target annual amount of $6,100,000 (although the amount shown for 2020 was lower due to pro-ration because his employment with the Company began in September 2020). The specific components of Mr. Siegmund’s 2021 target direct compensation were as follows (with each such component being consistent with his 2020 target direct compensation on an annualized basis: (i) base salary of $800,000, (ii) ACI target of 1x base salary ($800,000), (iii) PSUs of $2,250,000 and (iv) RSUs of $2,250,000. SEC compensation Mr. Siegmund’s 2021 SEC compensation was slightly higher than his target direct compensation, primarily due to Company’s performance resulting in a 2021 ACI award payout at 166.1% of target. Mr. Siegmund’s 2020 SEC compensation was substantially higher than his target direct compensation as it included the full grant date fair value of $3,375,000 in RSUs for his initial grant to achieve the target direct compensation of $2,250,000 in RSUs on an annual grant cycle. His 2020 SEC compensation also included the additional $1,500,000 in RSUs provided for by his offer letter as a sign-on award. The grant date fair value of the PSUs required to be included in 2020 and 2021 SEC compensation is slightly higher than the target award value in target direct compensation due to the relative TSR component being an award with a “market condition” under applicable accounting rules. As he joined the company in September 2020, the offer letter provided him a prorated 2020 ACI award payout at target (such amount shown for 2020 in the Summary compensation table on page 51 as “Bonus” due to the guaranteed level of 2020 payout under the offer letter). Realized compensation Mr. Siegmund’s realized compensation was lower than his target direct compensation primarily because the performance period for his initial PSU grant has not yet been completed. His 2021 realized compensation consisted principally of his base salary, 2021 ACI award payout at 166.1% of target and quarterly vestings of RSUs in the aggregate amount of approximately $3,066,500. In 2020, his realized compensation consisted principally of his prorated base salary, prorated 2020 ACI award payout at target and one quarter’s vesting of RSUs, of which $663,000 was from vesting of his RSU sign-on award.

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Gregory Hyttenrauch EVP and President, Americas				Key responsibilities and career highlights Mr. Hyttenrauch has served as our Executive Vice President and President, North America since January 2021. In April 2022, we expanded the scope of the North America business unit to include Latin America, with the combined organization referred to as Cognizant Americas. Prior to 2021, Mr. Hyttenrauch served as our Executive Vice President and President, Cognizant Digital Systems & Technology from December 2019 to January 2021. Prior to joining Cognizant, he served as Director, Global Cloud and Security Services for Vodafone from October 2015 to November 2019. Prior to Vodafone, Mr. Hyttenrauch held a variety of senior leadership positions at Capgemini, CSC and EDS.
Age 54 Education Royal Military College of Canada - B.S. University of Ottawa – M.B.A. Cognizant Tenure 2 years

Committee assessment and target direct compensation Mr. Hyttenrauch was selected by the Board to serve as the company’s EVP and President, North America based on his extensive operating experience in technology consulting, telecommunications and similar industries. The Compensation Committee originally set Mr. Hyttenrauch’s compensation for his role as the company’s EVP and President, Cognizant Digital Systems and Technology. The Compensation Committee, at its meeting in February 2021, evaluated Mr. Hyttenrauch’s performance during 2020 and considered the new role assumed by Mr. Hyttenrauch in January 2021, the company’s growth and transformation initiatives and strategic priorities, and the compensation information provided by Pay Governance for executives with similar responsibilities based on a size and industry-appropriate peer group and market data, including compensation information for executives at other companies with similar responsibilities and companies in the company’s peer group for 2021 (see “Peer group review ” on page 33). Based on these considerations, the Compensation Committee determined that Mr. Hyttenrauch’s target direct compensation for 2021 be set at approximately $3,600,000. The specific components of Mr. Hyttenrauch’s 2021 target direct compensation were as follows: (i) base salary of £487,000 (approximately $648,000), (ii) ACI target of 1x base salary (£487,000 or approximately $648,000), (iii) PSUs of $1,150,000 and (iv) RSUs of $1,150,000. His ACI award was based 40% on the overall company ACI metrics and targets like the other NEOs, with the remaining 60% based on metrics and targets specific to the North American business unit: (i) 35% based on constant currency revenue growth of the business unit and (ii) 25% based on business unit profit. Also in February 2021, the Compensation Committee granted an additional equity award due to the additional efforts required of Mr. Hyttenrauch during the ongoing changes in company leadership and transformation initiatives underway and retention considerations. As such, the Compensation Committee approved an additional $1,000,000 of RSUs, which amount is not included in target direct compensation. SEC compensation Mr. Hyttenrauch’s SEC compensation was substantially higher than his target direct compensation primarily due to the inclusion of the full grant date value of additional equity award of $1,000,000 in RSUsnot included in target direct compensation, as well as the 2021 ACI award payout at approximately 132% of target as a result of the Company’s and the North American business unit’s 2021 performance. The grant date fair value of the PSUs required to be included in 2021 SEC compensation is slightly higher than target in the actual award granted due to the relative TSR component being an award with a “market condition” under applicable accounting rules. Realized compensation The PSUs component of Mr. Hyttenrauch’s realized compensation was lower than his target direct compensation primarily because the performance criteria for the 2019/20 PSU grant planned for vesting in 2021 was not satisfied and the payout was $0. This, however, was offset by other sign-on and additional RSUs vesting from grants made in prior years. His 2021 realized compensation consisted principally of his base salary, 2021 ACI award payout at 132% of target, and quarterly vestings of RSUs in the aggregate amount of approximately $1,982,000. Certain numbers shown in the graphs above were converted to US$ based on a £1 = $1.33 exchange rate, the twelve-month average for fiscal year 2021.

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Compensation   >   CD&A   >   Compensation by NEO

John Kim EVP, General Counsel, Chief Corporate Affairs Officer and Secretary				Key responsibilities and career highlights Mr. Kim has been our Executive Vice President, General Counsel, Chief Corporate Affairs Officer and Secretary since March 2021. In this role, he leads the company’s legal, compliance, corporate affairs and company secretary functions. From November 2019 to March 2021, he served as Senior Vice President and Deputy General Counsel, Global Commercial Contracts and was the global legal executive responsible for Cognizant’s commercial engagements. Prior to joining Cognizant, he served as Global Head of Big Deals at Capgemini, U.S. Counsel for WNS Global Services and General Counsel for Travelport, a leading travel technology company, as well as a number of technology service companies.
Age 54 Education Columbia University – B.A. Cornell Law School – J.D. Cognizant Tenure 2 years

Committee assessment and target direct compensation Mr. Kim was selected by the Board to serve as the company’s EVP, General Counsel, Chief Corporate Affairs Officer and Secretary based on his extensive legal experience in the technology industry. In late March 2021, the Compensation Committee evaluated Mr. Kim’s performance in his prior role, qualifications and experience, and compensation information provided by Pay Governance for executives with similar responsibilities based on a size and industry appropriate peer group and market data, including compensation information for executives at other companies with similar responsibilities, including companies in the company’s peer group for 2021 (see “Peer group review” on page 33). Based on these considerations, the Compensation Committee determined that Mr. Kim’s target direct compensation for 2021 be set at $3,275,000 (retroactive to January 1, 2021). The specific components of Mr. Kim’s 2021 target direct compensation were as follows: (i) base salary of $650,000, (ii) ACI target of 1x base salary ($650,000), (iii) PSUs of $1,000,000 and (iv) RSUs of $975,000. However, in order for Mr. Kim’s annual realized equity awards to reach targeted levels quickly, he was awarded an aggregate of $1,650,000 RSUs in connection with his annual and promotion grants. SEC compensation Mr. Kim’s SEC compensation was substantially higher than his target direct compensation primarily due to the inclusion of the full grant date fair value of an aggregate of $1,650,000 in RSUs granted to achieve the target direct compensation $975,000 in RSUs on an annual grant cycle. His 2021 SEC compensation was also impacted by the 2021 ACI award payout at 166.1% of target as a result of the Company’s 2021 performance. For SEC compensation purposes, Mr. Kim’s salary includes $4,615 of cash paid in lieu of unused vacation (a one-time benefit provided to employees in 2021 in light of the COVID-19 pandemic). The grant date fair value of the PSUs required to be included in 2021 SEC compensation is slightly higher than the target award value due to the relative TSR component being an award with a “market condition” under applicable accounting rules. Realized compensation Mr. Kim’s realized compensation was substantially lower than his target direct compensation primarily because the performance period for his initial PSU grant has not yet been completed. In addition, as an Executive Vice President, his 2021 PSU and RSU grants are higher in value than the amount that vested in 2021 under his prior years’ RSU awards. For purposes of realized compensation, the cash paid in lieu of unused vacation was included in “Other”. His realized compensation consisted principally of his base salary, his 2021 ACI award payout at 166.1% of target, and quarterly vestings of RSUs in the aggregate amount of approximately $818,000.

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Rajesh Nambiar EVP and President, Digital Business and Technology and Chairman, Cognizant India				Key responsibilities and career highlights Mr. Nambiar has been our Executive Vice President and President of Digital Business and Technology (DB&T) since June 2021 and our Chairman, Cognizant India since joining Cognizant in November 2020. In his role as President of DB&T he brings together a compelling technology vision, strategy, roadmap, capabilities, solutions, partnerships and subject matter expertise into a single integrated business unit that runs all of the IT services for Cognizant. As Chairman of Cognizant India, he leads our India associates and enhances relationships with the government, key policy-making bodies and the Indian media. Prior to joining Cognizant in November 2020, Mr. Nambiar served as Chairman and President of Ciena India, a leading network solutions partner; IBM, where he led the Application Services practice and served as IBM’s Global Delivery Leader; and led the eastern region in the US and spent over 18 years at Tata Consultancy Services.
Age 54 Education Indian Statistical Institute in Kolkata – Master’s Degree Harvard Business School’s Advanced Management Program – Graduate Cognizant Tenure 1 year

Committee assessment and target direct compensation Mr. Nambiar was selected by the Board to serve as the company’s EVP and President, Digital Business and Technology based on his extensive operating experience in digital technology consulting and operations. In connection to his promotion in June 2021, the Compensation Committee evaluated Mr. Nambiar’s prior performance and considered the new role being assumed by Mr. Nambiar, the company’s growth and transformation initiatives and strategic priorities, and the compensation information provided by Pay Governance for executives with similar responsibilities based on a size and industry-appropriate peer group and market data, including compensation information for executives at other companies with similar responsibilities and companies in the company’s peer group for 2021 (see “Peer group review ” on page 33). Based on these considerations, the Compensation Committee determined that Mr. Nambiar’s target direct compensation for 2021 be set at approximately $3,200,000 (although base salary and ACI amounts were pro-rated for 2021). The specific components of Mr. Nambiar’s 2021 target direct compensation were as follows: (i) base salary of ₹43,824,000 (approximately $600,000 inclusive of the Company’s 12% matching contribution to the India Provident Fund; for 2021, the base salary was prorated to approximately $519,000 plus a $22,775 Company matching contribution to the India Provident Fund), (ii) ACI target of 1x base salary (₹43,824,000 or approximately $600,000, which was prorated to approximately $519,000* for 2021), (iii) PSUs of $1,000,000 and (iv) RSUs of $1,000,000. In addition, in order for Mr. Nambiar’s annual realized equity awards to reach targeted levels quickly, he was awarded $437,500 RSUs in connection with his promotion. Approximately 42% of Mr. Nambiar’s 2021 ACI award (representing the period from January 1 to June 4 when he assumed his current role) was based on the overall company ACI metrics and targets. The remainder of his ACI award was based 40% on the overall company ACI metrics and targets, with the remaining 60% based on metrics and targets specific to the Digital Business and Technology business unit: (i) 35% based on constant currency revenue growth of the business unit and (ii) 25% based on business unit profit. In February 2021, the Compensation Committee also granted an additional $2,250,000 of RSUs, which amount reflected a sign-on award included in his late 2020 offer letter that was delayed until February of 2021. SEC compensation Mr. Nambiar’s SEC compensation was substantially higher than his target direct compensation primarily due to the inclusion of the full grant date fair value of the sign-on equity award of $2,250,000 in RSUs not included in target direct compensation, the receipt of a portion of his sign-on award (as agreed to in his late 2020 offer letter) in the amount of ₹7,344,000 (or approximately $97,500) and a cash payment of ₹27,412,500 (or approximately $363,600) to compensate for a delay in the timing of equity grants contemplated in connection with his acceptance of employment. Mr. Nambiar’s PSUs granted in February and June of 2021 have differing accounting treatment related to “market condition” under applicable accounting rules, with the net impact being a slight decrease in the fair market value of the PSU awards. Realized compensation The PSUs component of Mr. Nambiar’s realized compensation was lower than his target direct compensation primarily because the performance period for his initial PSU grants had not elapsed for the awards to vest in 2021. This, however, was offset by additional RSUs vesting from grants made in 2021, the receipt of a portion of his sign-on bonus in the amount of approximately $97,500 and a cash payment of approximately $363,600 to compensate for a delay in the timing of equity grants contemplated in connection with acceptance of employment. His 2021 realized compensation consisted principally of his base salary, 2021 ACI award payout at approximately 124%* of target (based on the Company’s and the Digital Business and Technology business unit’s 2021 performance), and quarterly vestings of RSUs in the aggregate amount of approximately $1,334,000. *In India, ACI is calculated using the base salary amount including the 12% matching contribution to the India Provident Fund. However, such a matching contribution is not required to be made on the ACI payment. For comparability to our other NEOs, Mr. Nambiar’s ACI is shown as being calculated based on the actual 88% of his base salary that he received and the percentage payout is shown accordingly throughout this proxy statement. If it had been shown based on the full base salary including the matching contribution, his 2021 ACI payout percentage would have been 119%. Certain numbers shown in the graphs above were converted to US$ based on an approximately ₹1 = $0.013 exchange rate, the twelve-month average for fiscal year 2021.

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Compensation   >   CD&A   >   Other elements of compensation

Other elements of compensation

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Supplemental retirement programs
We do not have any nonqualified deferred compensation programs, pension plans or pre-tax supplemental executive retirement plans for our NEOs, except for the CSRP, which is designed for certain employees whose participation in our 401(k) savings plan is limited by IRS regulations and described under “Broad-based programs” on page 47.

Perquisites
We seek to maintain an egalitarian culture in our facilities and operations. The company’s philosophy is to provide a minimal number of personal benefits and perquisites to its executives and generally only when such benefits have a strong business purpose.

We incur expenses to ensure that our employees, including our executive officers, are accessible to us and our customers at all times and to promote our commitment to provide our employees and executives with the necessary resources and technology to allow them to operate “around the clock” in a “virtual office” environment. However, we do not view these expenses as executive perquisites because they are essential to the efficient performance of executives’ duties and are comparable to the benefits provided to a broad-based group of our employees. We also provide personal security services to certain of our executive officers where we believe the provision of such services is in the interest of the company, and we may reimburse executives for approved travel expenses where an immediate family member accompanies an executive to attend a business function at which such family member is generally expected to attend. In addition, the company provides Mr. Humphries with a corporate apartment in New York as a result of his frequent travel to our New York office and provides Mr. Hyttenrauch with a corporate apartment in New York as a result of his expatriate assignment in our New York office.

Company policies impacting compensation

Executive stock ownership guidelines

Our stock ownership guidelines are designed to further align the interests of our NEOs with those of our shareholders. Under the guidelines, each NEO is required over time to hold a number of shares with a value equal to the applicable multiple of annual base salary. The annual base salary and stock price utilized in the calculation is the annual base salary and stock price applicable as of the date an individual becomes an NEO. Compliance is required within five years of an officer becoming an NEO, subject to limited exceptions for hardship or other personal circumstances as determined by the Compensation Committee. As of April 5, 2022, none of our NEOs had yet reached their five-year deadline for compliance with the stock ownership guidelines; however, Mr. Humphries already held sufficient shares to be in compliance with our stock ownership guidelines.

Hedging, short sale, margin account and pledging prohibitions
Our insider trading policies include the following prohibitions:

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Compensation   >   CD&A   >   Company policies impacting compensation

Clawback policy
We maintain a clawback policy, which applies to all NEOs and certain other members of management.

Equity grant practices
The Compensation Committee or the Board approves the grant of stock-based equity awards, such as PSUs and RSUs, at its regularly scheduled meetings or by written consent (to be effective on the date of the meeting or receipt of all signed consents, or a later date). In addition, the Compensation Committee has authorized, subject to various limitations, a committee comprised of members of the executive management team to grant stock-based equity awards to certain newly hired and existing employees (including in certain cases employees hired through acquisitions), excluding executive officers and certain other senior employees. None of the Board, Compensation Committee, or executive management team committee engage in any market timing with regards to the stock-based equity awards made to executive officers or other award recipients. It is the company’s policy that all stock option grants, whether made by the Board, the Compensation Committee or the executive committee, have an exercise price per share equal to the fair market value of our common stock based on the closing market price per share on the grant date.

Risk assessment
The Compensation Committee believes that its approach to goal setting and setting of targets with payouts at multiple levels of performance assists in mitigating excessive risk-taking that could harm the company’s value or reward poor judgment by executives. Several features of the company’s compensation program reflect sound risk management practices. Notably, the Compensation Committee believes compensation has been allocated among cash and equity and short and long-term compensation elements in such a way as to not encourage excessive risk-taking, but rather to reward meeting strategic company goals that enhance shareholder value. In addition, the Compensation Committee believes that the mix of equity award instruments used under the company’s long-term incentive program (full value awards as well as the multi-year vesting of the equity awards) also minimize excessive risk-taking that might lead to short-term returns at the expense of long-term value creation. We also set stock ownership guidelines for our NEOs to help mitigate potential compensation risk (see page 48). Additionally, prior to determining the performance by the company against the targets for performance-based compensation (ACI and PSUs), the Compensation Committee adjusts the targets for the impact of acquisitions completed during the performance period in order to discourage excessive risk-taking with respect to M&A transactions. In sum, the Compensation Committee believes that the company’s compensation policies do not create risks that are reasonably likely to have a material adverse effect on the company.

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Tax considerations – deductibility of executive compensation
U.S. Internal Revenue Code (“IRC”) Section 162(m) imposes a $1 million annual limit on the amount that a public company may deduct for compensation paid to covered employees, which generally includes all current and certain former NEOs (2017 and later), who are employed as of the end of the year. As such, any compensation in excess of the $1 million annual limit that we may pay to a covered employee is not deductible.

Severance benefits
We have entered into executive employment and non-disclosure, non-competition and invention assignment agreements (collectively, the “Employment Agreements”) with each of Mr. Humphries, Mr. Siegmund, Mr. Hyttenrauch and Mr. Kim under which certain payments and benefits would be provided should the NEO’s employment terminate under certain circumstances, including in connection with a change in control (see page 60). We believe that the Employment Agreements achieve two important goals crucial to our long-term financial success, namely, the long-term retention of our NEOs and their commitment to the attainment of our strategic objectives. These agreements will allow our NEOs to continue to focus their attention on our business operations and strategic plans without undue concern over their own financial situations during periods when substantial disruptions and distractions, including a potential change in control, might otherwise prevail. We believe that these severance packages are fair and reasonable in light of market practices for executives of a similar level of experience as our NEOs, the level of dedication and commitment of our NEOs, the contributions our NEOs have made to our growth and financial success and the value we expect to receive from retaining the continued services of our NEOs, including during challenging transition periods following a change in control.

Compensation Committee report
The Compensation Committee has furnished the report set forth below. The information contained in this report shall not be deemed to be “soliciting material” or “filed” with the SEC or subject to the liabilities of Section 18 of the Exchange Act, except to the extent that the company specifically incorporates it by reference into a document filed under the Securities Act of 1933, as amended, or the Exchange Act.

To the Board of Directors of Cognizant Technology Solutions Corporation:

The Compensation Committee has reviewed and discussed with management the Compensation Discussion and Analysis set forth in the company’s proxy statement for the 2022 annual meeting of shareholders. The Compensation Committee has recommended to the Board of Directors that the Compensation Discussion and Analysis be included in such proxy statement for filing with the Securities and Exchange Commission and incorporated by reference into the company’s Annual Report on Form 10-K for the year ended December 31, 2021.

By the Compensation Committee of the Board of Directors of Cognizant Technology Solutions Corporation

VINITA BALI		ARCHANA DESKUS		LEO S. MACKAY, JR.		MICHAEL PATSALOS-FOX		JOSEPH M. VELLI

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Compensation   >   Executive compensation tables

Executive compensation tables

2021 Summary compensation table
The following 2021 Summary Compensation Table provides certain summary information concerning the compensation earned for services rendered in all capacities to us and our subsidiaries for the years ended December 31, 2019, 2020 and 2021 by our CEO, CFO and each of our three other most highly compensated executive officers who were serving as executive officers at the end of the 2021 fiscal year (collectively, the “NEOs”). No executive officers who would have otherwise been includable in such table on the basis of total compensation for the 2020 fiscal year have been excluded by reason of their termination of employment or change in executive status during that year.

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Compensation    >   Executive compensation tables

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2021 Grants of plan-based awards table
The following table provides certain summary information concerning each grant of an award made to an NEO in the 2021 fiscal year under a compensation plan.