Designer Brands (DBI) DEF 14ADefinitive proxy

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

Filed by the Registrantþ

Filed by a Party other than the Registranto

Check the appropriate box:

(Name of Registrant as Specified In Its Charter)

Payment of Filing Fee (Check the appropriate box):

Notice of 2022 Annual Meeting of Shareholders
and Proxy Statement

April 5, 2022

Dear Designer Brands Shareholder:

You are cordially invited to attend the 2022 Annual Meeting of Shareholders of Designer Brands Inc. (the “Company”) at 11:00 a.m. Eastern Time on May 19, 2022. This year, in light of the continuing impact of the COVID-19 pandemic, and to support the well-being of our associates and shareholders, the Annual Meeting will again be held in a virtual-only format. All holders of shares of our outstanding common stock as of the close of business on March 25, 2022, are entitled to vote at the meeting. Details of the business to be conducted at the meeting are given in the Notice of 2022 Annual Meeting of Shareholders and the Proxy Statement, which are included on the following pages. Instructions for accessing the virtual meeting webcast online are also included in the Proxy Statement.

Fiscal 2021 was a pivotal year for the Company. We emerged stronger than ever despite the challenges in the operating environment, accomplishing $3.2 billion in sales for the year and set many operating and financial records along the way. I am incredibly proud of what we have been able to achieve, and very excited about our future growth. All of this has been made possible by our dedicated and hardworking associate team, who have enabled us to be in a position of strength both strategically and financially.

Looking back on last two years, it is clear that the pandemic was an accelerant, forcing us to grow and change rapidly in order to meet supply and inventory challenges and a shifting consumer sentiment. We believe that we have more than risen to the occasion, as demonstrated by our increased market share in categories such as athleisure, which also provided us with opportunities to grow our men’s and kids categories within our U.S. retail business to record levels this year. Our growth was driven by our sharp focus on enhancing and growing our digital and omnichannel capabilities, and we exceeded $1 billion of digital demand for the first time this year. We are also excited to see material growth of our owned brands, such as Vince Camuto, during the year and taking a leading role in our strategic growth go-forward powered by our significant direct-to-consumer infrastructure already in place.

We feel we have a truly unique and advantageous business model, which combines top-class design and sourcing with a robust, award-winning retail infrastructure that is built upon 28 million loyal and engaged VIP customers. These customers love the brands we produce, love the assortment we offer of national brands, and love the ease, convenience, and experience of shopping with us across the U.S. and Canada.

We are taking all these steps with our shareholders in mind, and we believe we have the tools that we need to continue this growth well into the future.

Your vote is important. Whether or not you plan to attend the annual meeting virtually, please vote as soon as possible. As an alternative to voting during the annual meeting, you may vote in advance via the internet, by telephone or, if you receive a paper proxy card in the mail, by mailing the completed proxy card. Voting by any of these methods will ensure you have a say on the important issues to be voted on at the annual meeting.

I would like to thank you personally for your continued support of Designer Brands Inc.

Roger L. Rawlins
Chief Executive Officer

Notice of 2022 Annual Meeting of Shareholders

Designer Brands Inc.

810 DSW Drive
Columbus, Ohio 43219
(614) 237-7100

Items of Business – 2022 Annual Meeting

Shareholders will also transact such other business as may properly come before the 2022 Annual Meeting or any adjournment, continuation, or postponement thereof.

	Who Can Vote		How to Virtually Attend the 2022 Annual Meeting
	Only the holders of record of our Class A and Class B Common Shares at the close of business on March 25, 2022, our record date for the 2022 Annual Meeting of Shareholders (the “2022 Annual Meeting”), are entitled to notice of and to vote at the 2022 Annual Meeting. Each shareholder is entitled to one vote for each Class A Common Share held as of the record date, and eight votes for each Class B Common Share held as of the record date.		To attend the 2022 Annual Meeting at www.virtualshareholdermeeting.com/DBI2022, you must enter the control number on your proxy card, voting instruction form or Notice of Internet Availability you previously received. Whether or not you plan to virtually attend the 2022 Annual Meeting, we encourage you to vote and submit your proxy in advance of the 2022 Annual Meeting by one of the methods described below. You may also vote online and examine our shareholder list during the 2022 Annual Meeting by following the instructions provided on the meeting website during the 2022 Annual Meeting. To vote online during the meeting, visit www.virtualshareholdermeeting.com/DBI2022.

Your Vote is Important: Even if you plan to attend the 2022 Annual Meeting, please cast your vote as soon as possible, following the instructions on your proxy card or voting instruction form (“VIF”):

By internet Go to www.proxyvote.com	By toll-free telephone Dial 1-800-690-6903	By mail If you received a proxy card or VIF by mail, please mark, date, sign, and return it in the postage-paid envelope furnished for that purpose	By QR code   Scan the QR code (located on your voting document) using your smart phone.

Please consider the issues presented in this proxy statement and vote your shares, by Internet or telephone, or sign, date, and return your proxy card, as promptly as possible.

Submitting your proxy now will not prevent you from voting your shares at the 2022 Annual Meeting, as your proxy is revocable at your option. Whether or not you attend the 2022 Annual Meeting, it is important that your shares be part of the voting process. You may log on to www.proxyvote.com and enter your control number to vote your shares. You can also vote in advance of or during the 2022 Annual Meeting. If you attend the virtual annual meeting, please follow the instructions at www.virtualshareholdermeeting.com/DBI2022 to vote or submit questions during the meeting.

Michelle C. Krall

Senior Vice President, General Counsel, Corporate Secretary and Chief Compliance Officer

Designer Brands Inc.

April 5, 2022

TABLE OF CONTENTS

Forward-Looking Statements

Certain statements in this Proxy Statement may constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are based on current expectations and assumptions that involve risks and uncertainties and on information available to the Company as of the date hereof. The Company’s actual results could differ materially from those stated or implied, due to risks and uncertainties associated with its business, which include the risk factors disclosed in its latest Annual Report on Form 10-K and other filings with the SEC, including, without limitation, the section entitled “Risk Factors” contained therein. Forward-looking statements include statements regarding the Company’s expectations, beliefs, intentions or strategies regarding the future, and can be identified by forward-looking words such as “plans,” “anticipate,” “believe,” “could,” “continue,” “estimate,” “expect,” “intend,” “may,” “should,” “will” and “would” or similar words. The Company expressly disclaims any obligation or undertaking to disseminate any updates or revisions to any forward-looking statement contained herein to reflect any change in the Company’s expectations with regard thereto or any change in events, conditions or circumstances on which any such statement is based.

Websites

Website addresses referenced in this proxy statement are provided for convenience only, and the content on the referenced websites does not constitute a part of this proxy statement.

PROXY STATEMENT SUMMARY

This Proxy Statement is being furnished in connection with the solicitation of proxies by the Board of Directors (the “Board”) of Designer Brands Inc., an Ohio corporation, for use at the 2022 Annual Meeting of Shareholders to be held on May 19, 2022, at 11:00 a.m. Eastern Time via live audio cast at www.virtualshareholdermeeting.com/DBI2022. It is first being mailed to the shareholders on or about April 5, 2022. This summary does not contain all of the information you should consider, and you should read the entire Proxy Statement carefully before voting. (“We,” “our,” “us,” “Designer Brands,” “DBI,” and the “Company” refer to Designer Brands Inc.)

2022 Annual Meeting of Stockholders

How to Attend

To participate in the virtual meeting, please visit www.virtualshareholdermeeting.com/DBI2022 and enter the 16-digit control number included in your Notice, on your proxy card, or on the instructions that accompanied your proxy materials.

How to Vote

BY TELEPHONE	BY INTERNET	BY QR CODE	BY MAIL	VIRTUALLY
Call toll-free 24/7 1.800.690.6903	Visit 24/7 www.proxyvote.com	Scan the QR code (located on your voting document) using your smart phone	Complete, date, and sign your proxy card and send by mail in the enclosed postage-paid envelope	Cast your ballot online during the virtual meeting

Proposals Requiring Your Vote

Your vote is very important! Please cast your vote immediately on all of the proposals to ensure that your shares are represented.

Business Overview – 2021 Highlights

We are extremely proud of the performance that the Company achieved during fiscal 2021. Our Company and industry were significantly impacted by the pandemic in the prior year (fiscal 2020), in which we saw a substantial drop in sales and a significant decline in net income. These challenging results were driven by the shutdowns of our stores in response to government mandates and the shift of customer purchases away from our historical areas of strength, such as dress, to athleisure wear.

Against this backdrop, our leadership team drove our business to great success in fiscal 2021. Our flexible business model, supported by our dedicated and hardworking associates, has allowed us to emerge from this unprecedented operating environment strongly. We are proud of our accomplishments in fiscal 2021, which included:

We were able to demonstrate resiliency and achieve this standout performance due to the steady leadership of our executive team, bolstered by support from our associates and their dedication to our Company. Despite continuing headwinds in the operating environment, our leadership team has positioned the Company to compete in the new retail environment going forward.

As we look ahead to our strategic growth, we have organized our efforts around three pillars:

Your Board of Directors

The following table provides summary information about each director currently serving on our Board. Our Board is divided into three classes and is currently composed of two directors in Class I, four directors in Class II, and four directors in Class III. Directors serve for three-year terms with one class of directors elected by our shareholders at each annual meeting. Three of the Class III directors are standing for reelection at the 2022 Annual Meeting. Ms. Singh-Bushell is not standing for reelection. Accordingly, as of the 2022 Annual Meeting, the size of the Board will be reduced from ten members to nine. Under our Amended and Restated Code of Regulations (the “Code of Regulations”), we may have a minimum of five and a maximum of fifteen directors. By majority vote, the Board may set the number of directors within this range at any time. Your Board recommends that you vote “FOR” the election of each of the three Class III director nominees. See “Proposal 1 – Election of Directors.”

Name & Principal Occupation	Age	Director Since	Independent	Committee Memberships
Class I – Term Expires 2023
Harvey L. Sonnenberg Former Partner of Weiser, LLC	80	2005		·    AC† ·    TC
Allan J. Tanenbaum Of Counsel of Taylor English Duma, LLC	75	2005		·    AC ·    NCGC
Class II - Term Expires 2024
Peter S. Cobb Founder and Former Executive Vice President of eBags	64	2017		·    NCGC† ·    CC ·    TC
Jay L. Schottenstein Executive Chairman of Designer Brands Inc. and Chief Executive Officer of American Eagle Outfitters, Inc.	67	2005
Roger L. Rawlins Chief Executive Officer of Designer Brands Inc.	55	2016
Joanne Zaiac Former Chief Client Officer of Dentsu Aegis Network	60	2016		·    CC ·    TC
Class III - Term Expires 2022
Elaine J. Eisenman Managing Director of Saeje Advisors	73	2008		·    CC† ·    AC
Joanna T. Lau Chief Executive Officer of Lau Technologies	63	2008		·    TC† ·    CC ·    NCGC
Joseph A. Schottenstein Chief Operating Officer and Executive Vice President of Acquisitions and Leasing at Schottenstein Property Group (“SPG”) and Schottenstein Realty, LLC	42	2012
Ekta Singh-Bushell Former Chief Operating Officer, Executive Office, at the Federal Reserve Bank of New York	50	2018		·    AC ·    NCGC

Current Board Snapshot*

*Ms. Singh-Bushell is included in this snapshot but is not standing for reelection at the 2022 Annual Meeting.

Summary of Director Skills

Our directors bring to our Board a wide variety of skills, qualifications, and viewpoints that strengthen the Board’s ability to carry out its oversight role on behalf of our shareholders. The table below is a summary of the range of skills and experiences that each director brings to the Board, and which we find to be relevant to our business. Because it is a summary, it does not include all of the skills, experiences, and qualifications that each director offers, and the fact that a particular experience, skill, or qualification is not listed does not mean that a director does not possess it. All of our directors exhibit high integrity, an appreciation for diversity of background and thought, innovative thinking, a proven record of success, and deep knowledge of corporate governance requirements and best practices.

Attributes, Experience, and Skills
Leadership Experience	ü	ü	ü	ü	ü	ü	ü	ü	ü	ü
Retail Industry Experience	ü	ü	ü	ü	ü	ü	ü	ü	ü	ü
Financial Expertise	ü	ü	ü	ü	ü	ü	ü	ü	ü	ü
Audit Committee Financial Expert	ü							ü		ü
International Experience			ü	ü	ü	ü	ü	ü	ü	ü
Marketing and Consumer Insight		ü	ü	ü	ü	ü	ü		ü
Technology and Digital Expertise			ü	ü	ü	ü		ü		ü
Strategic Growth and Business Development Expertise		ü	ü	ü	ü	ü	ü	ü	ü	ü
Human Capital/Talent Management Experience		ü	ü	ü	ü	ü	ü	ü		ü
Risk Management Expertise	ü	ü	ü	ü	ü	ü	ü	ü	ü	ü
Corporate Governance Expertise	ü	ü	ü	ü	ü		ü	ü		ü
Real Estate Experience	ü	ü	ü	��	ü			ü	ü	ü
Mergers & Acquisitions Experience	ü	ü	ü	ü	ü	ü	ü	ü	ü	ü
Crisis Management Experience		ü	ü	ü	ü		ü			ü
Corporate Social Responsibility Experience		ü		ü			ü			ü
Other Public Company Board Experience	ü	ü	ü	ü			ü	ü		ü

Corporate Governance Highlights

The Board remains committed to strong corporate governance and the protection of long-term shareholder value. Please see “Other Director Information, Board Committees, and Corporate Governance Information” for a description of our corporate governance practices. These include, but are not limited to:

Sustainability, Social Impact and Human Capital

At DBI, we are committed to good corporate citizenship, which means putting our associates first, striving to create positive impacts within our organization, and aiming to better the communities in which we conduct business.

Consistent with our core values of Passion, Accountability, Humility, and Collaboration, we continued to focus on sustainability, philanthropy, and associate engagement during fiscal 2021.

Sustainability

At DBI, we believe in the importance of helping to creating a sustainable future, and are proud of the following achievements and goals that we have set:   ·    Since 2010, we have reduced energy consumption by approximately 15% in our stores through our Energy Management System   ·    We engaged a sustainability consultant in 2021 to help us further our efforts   ·    As of January 31, 2022, 37% of our stores operated with LED lighting   ·    Almost all merchandise display fixtures needed in 2022 are expected to be composed predominately of salvaged fixtures   ·    In January 2022, we joined the Sustainable Apparel Coalition

Social Impact

Together with our long-time partner Soles4Souls, we have donated nearly six million pairs of shoes, including almost two million pairs in fiscal 2021, diverting them from landfills.   In June 2021, we partnered with Soles4Souls to extend our support to LGBTQ+ communities for Pride month.

Human Capital

Our associates form the core of everything that we do. In fiscal 2021, we achieved the following:   ·    Perfect score on the Human Rights Campaign’s (“HRC’s”) Corporate Equality Index   ·    Named one of HRC’s Best Places to Work for LGBT Equality Index   ·    Named one of Forbes’ “The Best Employers for Women” and “The Best Employers for Diversity”   ·    Invested $2 million into advancing action-oriented Diversity, Equity & Inclusion through a partnership with Pensole Lewis College of Business & Design

2021 Shareholder Outreach

Historically, we have received strong shareholder approval for our “say-on-pay” advisory vote. At the 2021 Annual Meeting of Shareholders, approximately 72% of the votes cast were in favor of our 2020 executive compensation, compared to approximately 99% at our 2020 Annual Meeting of Shareholders.

During 2021, we broadened our shareholder outreach to non-affiliate shareholders whose combined ownership represents nearly 30% of our outstanding Class A common shares. The Company plans to continue its shareholder outreach efforts and welcomes constructive dialogue with its shareholder base.

Response to Shareholder Feedback

In response to the feedback we received on our 2020 executive compensation program, the Compensation Committee took steps to address concerns, including a move back towards the Company’s historical practice of granting performance-based long-term incentive equity awards and limiting retention bonuses.

Compensation Highlights and Say-on-Pay

Our executive compensation policies and practices reinforce our pay for performance philosophy and align with sound governance principles and shareholder interests. In response to the results of our 2021 say-on-pay advisory vote, we contacted non-affiliate shareholders representing nearly 30% of our outstanding Class A common shares to, among other things, discuss their perspectives on our executive compensation program. Informed by these discussions, and in consideration of the feedback that we received from our shareholders, we made certain decisions regarding our compensation practices going forward, as summarized in the chart above. Based on these changes and the significant strides made in our financial performance during fiscal 2021, our Board recommends that shareholders vote to approve an advisory resolution on the compensation paid to the Company’s named executive officers (“NEO”), as described in this Proxy Statement. For additional information regarding the compensation paid to the Company’s NEOs and our annual say-on-pay vote, see “Compensation Discussion and Analysis” and “Proposal 3 – Advisory Vote on the Compensation of Named Executive Officers.”

Compensation Objectives

We aim to attract and retain highly qualified, experienced executives who can make significant contributions to our long-term business success; reward executives for achieving business goals and delivering strong performance; and align executive incentives with shareholder value creation.

Strong Governance Standards and Best Practices

The Compensation Committee of our Board is fully engaged to respond to the dynamic business environment in which we operate. As discussed in the Compensation Discussion and Analysis (“CD&A”) section of this Proxy Statement, the Compensation Committee:

Pay for Performance

We pay for performance. To incentivize our executive team to achieve our short- and long-term goals, we allocate total direct compensation (salary, short- and long-term incentives) to achieve (and pay for) superior performance. To this end, the total direct compensation of our named executive officers is allocated as follows among pay elements:

2022 Proxy Statement

This Proxy Statement is provided in connection with the solicitation on behalf of our Board of Directors (the “Board”) for proxies to be voted at our 2022 Annual Meeting of Shareholders to be held at 11:00 a.m. Eastern Time on Thursday, May 19, 2022, and any postponements, continuations, or adjournments thereof (the “2022 Annual Meeting”). The 2022 Annual Meeting will be a virtual only meeting. Shareholders may participate online by logging onto www.virtualshareholdermeeting.com/DBI2022. There will not be a physical meeting location, and you will not be able to attend the meeting in person. Please see “Virtual Meeting Information” for important information. This Proxy Statement, including the Notice of Annual Meeting, is being made available electronically (or is first being mailed to shareholders) on or about April 5, 2022.

Voting Information

Pursuant to rules adopted by the U.S. Securities and Exchange Commission (the “SEC”), we have elected to provide access to our proxy materials via the Internet. Accordingly, we are sending a Notice of Internet Availability of Proxy Materials (the “Notice”) to our shareholders of record and beneficial owners. If your shares are registered directly in your name with our transfer agent, Computershare Limited (“Computershare”), then you are considered a registered shareholder with respect to those shares. If you hold your shares through an intermediary, such as a bank or broker, then you are considered the beneficial holder of those shares. All shareholders will have the ability to access the proxy materials on a website referred to in the Notice or request to receive a printed set of the proxy materials, at no charge. Instructions on how to access the proxy materials via the Internet or to request a printed copy may be found on the Notice. In addition, shareholders may request to receive proxy materials in printed form by mail or electronically by email on an ongoing basis by following the instructions on the website referred to in the Notice.

We have two classes of securities outstanding and entitled to vote at the 2022 Annual Meeting: our Class A Common Shares, no par value, and our Class B Common Shares, no par value (together, the “Common Shares”). Only shareholders of record at the close of business on March 25, 2022, our record date for the 2022 Annual Meeting, are entitled to notice of and to vote at the 2022 Annual Meeting or any adjournments, continuations, or postponements thereof. As of the record date, the total number of outstanding Class A Common Shares entitled to vote at the 2022 Annual Meeting is 64,551,951 and the total number of Class B Common Shares entitled to vote at the meeting is 7,732,743. Each outstanding Class A Common Share is entitled to one vote with respect to each matter to be voted on at the meeting and each outstanding Class B Common Share is entitled to eight votes with respect to each matter to be voted on at the meeting. Class A Common Shares and Class B Common Shares vote together as a single class with respect to all matters submitted to a vote of shareholders.

Without affecting any vote previously taken, a proxy may be revoked by a shareholder by giving a written notice of revocation to us in writing (Designer Brands Inc., 810 DSW Drive, Columbus, Ohio 43219, Attention: Corporate Secretary). A holder of record may also revoke or change his, her, or its vote by executing and returning to us a later-dated proxy or by virtually attending the 2022 Annual Meeting and voting online during the meeting. If your Common Shares are held in street name, you must follow the instructions of your broker, bank, or other nominee to revoke your voting instructions.

All properly executed proxies received by the Board will be voted as directed by the shareholder. All properly executed proxies received by the Board that do not specify how shares should be voted will be voted “FOR” the election of the Class III director nominees listed below under “Proposal 1 - Election of Directors,” “FOR” “Proposal 2 - Ratification of the Appointment of Independent Registered Public Accounting Firm,” and “FOR” “Proposal 3 - Advisory Vote on the Compensation of Named Executive Officers,” and in the discretion of the named proxies on any other business properly brought before the 2022 Annual Meeting.

The presence, in person or by proxy, of the holders of a majority of the outstanding Common Shares entitled to vote is necessary to constitute a quorum for the transaction of business at the 2022 Annual Meeting. Abstentions, votes to withhold and broker non-votes are counted for purposes of determining the presence or absence of a quorum. Broker non-votes occur when brokers holding shares on behalf of beneficial owners do not receive voting instructions from the beneficial holders and are not permitted to vote on the matter without voting instructions. If a broker does not receive voting instructions, the broker may vote those shares only on matters deemed “routine” by the New York Stock Exchange (the “NYSE”). Proposal 2 - Ratification of the Appointment of Independent Registered Public Accounting Firm is deemed a “routine” matter. On non-routine matters, such as the election of directors and the advisory vote on executive compensation, brokers cannot vote unless they receive voting instructions from beneficial holders.

Solicitation of proxies may be made by mail, personal interview and by telephone by our directors and employees, including officers. We will bear the cost of the solicitation of proxies, including the charges and expenses of brokerage firms and others for forwarding solicitation material to beneficial owners of shares.

PROPOSAL 1— ELECTION OF DIRECTORS

Our Board currently consists of ten members and is divided into three classes, designated as Class I, Class II, and Class III. The members of the three classes are elected to serve for staggered terms of three years. Pursuant to Article II, Section 2.02 of our Code of Regulations, the number of directors constituting each class will, as nearly as practicable, be equal. As previously discussed, Ms. Singh-Bushell is not standing for reelection at the 2022 Annual Meeting. Accordingly, as of the 2022 Annual Meeting, the size of the Board will be reduced from ten members to nine.

At the 2022 Annual Meeting, three Class III directors are nominated for election on the Board, each as a Class III director with a term to expire at the 2025 annual meeting of shareholders. Each of the nominees for director currently serves as a director of the Company.

We are committed to strong corporate governance, and our Board regularly reviews our governance structure, including our classified board structure. Our Articles of Incorporation, as amended (the “Articles”) divides our Board into three classes, with each class elected to serve a three-year term. As a result, at each annual meeting of shareholders, approximately one-third of our directors are elected to serve for a three-year term. Our Board has periodically considered the continued appropriateness of this classified board structure and believes that our classified board structure provides important benefits, including:

The names and ages of the “Director Nominees” and the “Continuing Directors,” their principal occupations during the past five years, and certain other information regarding our directors are provided below.

Class III Director Nominees for a Term to Expire in 2025:

Continuing Class II Directors for a Term to Expire in 2024:

Continuing Class I Directors for a Term to Expire in 2023:

Unless otherwise directed, the persons named in the proxy will vote the proxies “FOR” the election of the above-named director nominees as Class III director nominees. While it is contemplated that all director nominees will stand for election, in the event any person nominated fails to stand for election, the proxies will be voted for such other person or persons as may be designated by the directors. We have no reason to believe that any of the above-mentioned persons will not stand for election or serve as a director. Proxies cannot be voted for a greater number of persons than the number of nominees named herein.

Vote Required

Under Ohio law and our Code of Regulations, directors are elected by a plurality of the votes cast. This means that the nominees receiving the greatest number of votes voted “FOR” their election will be elected as directors. Withheld and broker non-votes will not be treated as votes cast for this purpose and, therefore, will not affect the outcome of the election.

Your Board of Directors unanimously recommends a vote “FOR” each of the Class III director nominees.

INFORMATION ABOUT OUR EXECUTIVE OFFICERS

Our executive officers are appointed annually by our Board and serve at the pleasure of the Board. In addition to Jay Schottenstein and Roger Rawlins, whose information is provided above under “Proposal 1 - Election of Directors,” the following individuals are our executive officers.

Deborah L. Ferrée, age 68, has served as President, Camuto LLC since June 2021 and as the Vice Chair of the Company since January 2006. She previously served as our President from February 2019 until June 2021. Ms. Ferrée joined us in November 1997. She served as Vice Chair and Chief Merchandising Officer from January 2006 until February 2019. She served as our President and Chief Merchandising Officer from November 2004 until January 2006. From March 2002 until November 2004, she served as Executive Vice President and Chief Merchandising Officer. Prior to that, she served as Senior Vice President of Merchandising beginning in September 2000, and Vice President of Merchandising beginning in October 1997. Prior to joining us, Ms. Ferrée worked in the retail industry for more than 20 years in various positions, including serving as Divisional Merchandising Manager of Shoes, Accessories and Intimate Apparel for Harris Department Store, women’s buyer for Ross Stores, and Divisional Merchandise Manager of the May Company.

William L. Jordan, age 50, has served as our President since June 2021. He previously served as our Executive Vice President and Chief Growth Officer from February 2020 until June 2021. From February 2019 until February 2020, he served as Executive Vice President of Designer Brands Inc. and President of DSW Shoe Warehouse, Inc. From May 2018 to January 2019, Mr. Jordan served as President of Town Shoes Limited (now known as Designer Brands Canada Inc.), our Canadian business. From February 2017 to February 2019, he was our Executive Vice President, Chief Administrative Officer, and Chief Legal Officer. In addition, from February 2015 to February 2017, he was our Executive Vice President, Chief Administrative Officer, General Counsel and Secretary. From March 2009 to January 2015, he was our Executive Vice President, General Counsel, Secretary, and Chief Compliance Officer. From May 2008 to March 2009, he was our Senior Vice President, General Counsel, and Secretary. In January 2006, Mr. Jordan joined us as our Vice President, General Counsel, and Secretary. Prior to joining us, he served as Corporate Counsel for Lancaster Colony Corporation beginning in 2005, and was with the firm of Porter, Wright, Morris & Arthur LLP in Columbus, Ohio, from 1997 to 2005, where he specialized in corporate securities and mergers & acquisitions law.

Jared A. Poff, age 49, has served as our Executive Vice President, Chief Financial Officer since October 2018. From November 2016 to October 2018, he was our Senior Vice President and Chief Financial Officer. From June 2016 to November 2016, he was our Senior Vice President, Finance, Treasurer, and Interim Chief Financial Officer. In January 2015, Mr. Poff joined us as Vice President of Finance, Business Development, and Treasurer. Prior to joining the Company, Mr. Poff served as Vice President, Treasurer at Big Lots, Inc. since February 2004.

Mary Turner, age 63, has served as our Executive Vice President and as President, Designer Brands Canada Inc., our wholly owned subsidiary, since March 2020, where she leads the Shoe Company and Shoe Warehouse banners, as well as DSW’s merchandising and operations in Canada. From February 2019 to March 2020, Ms. Turner served as Senior Vice President of Designer Brands Inc. and President of Designer Brands Canada Inc. Prior to our acquisition of Town Shoes Limited (now known as Designer Brands Canada Inc.) in May 2018, Ms. Turner joined Town Shoes Limited as Chief Merchant in January 2017, and was promoted to Chief Operating Officer for Town Shoes Limited in July 2017, where she led merchandising, planning, marketing, stores, and e-commerce functions of Town Shoes, Shoe Company, Shoe Warehouse and DSW Canada until February 2019. Prior to that, she was an executive with Hudson’s Bay Company for nearly 20 years and held a variety of merchandising roles with Holt Renfrew earlier in her career.

James Weinberg, age 60, has served as our Executive Vice President, Chief Merchandising Officer since January 2022. From 2019 to January 2022, he was our Senior Vice President, Chief Merchandising Officer of DSW Shoe Warehouse, Inc., and from 2017 to 2019, he was Senior Vice President, GMM Women’s. Prior to joining the Company in 2015 as its Senior Vice President, GM Affiliated Business Group, Mr. Weinberg was the President of Beyond the Rack from 2010 to 2015. Previously, he served as Burlington Coat Factory’s Senior Vice President, GMM Ladies Apparel and Coats from 2008 to 2010, Kellwood Co.’s Group President Designer Alliance from 2006 to 2008, and Robinsons-May’s Senior Vice President from 2002 to 2006 (and held other positions with Robinsons-May from 1996 to 2002).

OTHER DIRECTOR INFORMATION, BOARD COMMITTEES, AND CORPORATE GOVERNANCE INFORMATION

Board Leadership Structure

Pursuant to our Corporate Governance Principles, the Company does not have a policy with respect to the separation of the offices of Executive Chairman and CEO. The Board believes that the determination of whether these roles should be separated is part of the succession planning process, and that it is in the best interest of the Company for the Board to make a determination in this regard whenever it elects a new CEO.

Since 2009, the Company has had separate CEO and Executive Chairman roles. Our Board periodically assesses these roles and the Board leadership structure to ensure the interests of the Company and its shareholders are best served. The Board believes that the current leadership structure, with a separated Executive Chairman and CEO structure, allows the Executive Chairman to focus on Board responsibilities and the CEO to concentrate on the Company’s administrative and operating functions. Furthermore, this structure supports the efficient allocation of oversight responsibilities between the Board and management.

Mr. Jay Schottenstein has served as our Executive Chairman since 2005. As discussed below, Mr. Schottenstein is not an independent director. While the Board does not have a lead independent director, the independent members of the Board meet in regularly scheduled executive sessions (without management or the Executive Chairman present). Additionally, the Board does not have a designated director who leads executive sessions; instead, the independent directors alternate as the chair of such executive sessions in alphabetical order by last name. The Board believes that the current structure ensures that the independent directors provide sufficient independent oversight of management.

The Executive Chairman and CEO set the agenda for Board meetings with the understanding that certain items pertinent to the advisory and monitoring functions of the Board be brought to it periodically by the Executive Chairman or CEO for review and/or decision. The Executive Chairman is responsible for presiding at regular sessions of the Board. Information and data that is important to the Board’s understanding of the Company’s businesses is distributed in writing to the Board before the Board meets to allow the directors an opportunity to prepare for discussion of the items at the meeting. It is the general policy of the Company that all major decisions be considered by the Board as a whole.

The chairs of our Board committees play an active role in leading our committees by working with management to ensure each committee discusses crucial risks and opportunities of the Company. Agenda items that fall within the scope of responsibilities of a Board committee are set by the chair of that committee. Any member of the Board may request that an item be included on the agenda and is free to raise at any Board or committee meeting subjects that are not on the agenda for that meeting. The Board and each committee have the power to hire independent legal, financial, or other advisors as they may deem necessary, without consulting or obtaining the advanced approval of any officer of the Company and the Company shall be responsible for paying the fees and other costs associated with any such services rendered to the Board or any committee thereof.

Corporate Governance Principles

The Board has adopted Corporate Governance Principles that address Board structure, membership (including nominee qualifications), performance, operations, and management oversight. A current copy of our Corporate Governance Principles can be found at our corporate and investor website at investors.designerbrands.com/governance-documents and is available in print (without charge) to any shareholder upon request to 810 DSW Drive, Columbus, Ohio 43219, Attn: Corporate Secretary.

Director Independence

Our director independence standards are set forth in our Corporate Governance Principles. Pursuant to our Corporate Governance Principles, a majority of our directors must be independent. For a director to be considered an “independent director,” the Board must annually determine that he or she satisfies the independence requirements under the NYSE listing standards and any other applicable laws, rules, and regulations. During its annual review of director independence, the Board considered whether there were any transactions or relationships between the Company and any director or any member of his or her immediate family (or any entity of which a director or an immediate family member is an executive officer, general partner, or significant equity holder).

As a result of its annual review, the Board affirmatively determined that the following persons are independent under our independence standards:

As Mr. Rawlins is our CEO, he is not independent. In light of his status as an executive officer of the Company, the Board determined that Mr. Jay Schottenstein is not independent. Mr. Joseph Schottenstein, who is Mr. Jay Schottenstein’s son, also is not independent as he is an immediate family member of an executive officer of the Company. Accordingly, the Board is currently 70% independent. As previously discussed, Ms. Singh-Bushell is not standing for reelection and, therefore, will no longer serve on the Board after the 2022 Annual Meeting. Following the 2022 Annual Meeting, the Board will be 66.67% independent.

Each of the Nominating and Corporate Governance Committee, Compensation Committee, and Audit Committee are composed entirely of independent directors as defined under applicable SEC rules and the NYSE listing standards. Our Board also has a Technology Committee composed entirely of independent directors.

Family Relationships

Other than Messrs. Jay and Joseph Schottenstein, who are father and son, there are no family relationships among our directors and executive officers.

Meetings

A total of six meetings of the Board were held during the fiscal year ended January 29, 2022 (“fiscal 2021”). Each director attended 75% or more of the aggregate of (i) the total number of meetings of the Board held during the time in which such director was a member of the Board and (ii) the total number of meetings held by all committees of the Board on which such director served during the period such director served as a member of such committee. Overall average attendance at such meetings was over 95%.

Our Corporate Governance Principles provide that all incumbent directors and director nominees are encouraged to attend our Annual Meeting of Shareholders. All of the Company’s then-serving directors virtually attended our 2021 Annual Meeting of Shareholders.

Board Committees

We have four standing committees of the Board: (1) Nominating and Corporate Governance Committee; (2) Compensation Committee; (3) Audit Committee; and (4) Technology Committee. Each standing committee is governed by a committee charter. A current copy of each committee’s charter can be found on our corporate and investor website at investors.designerbrands.com/governance-documents and is available in print (without charge) to any shareholder upon request to 810 DSW Drive, Columbus, Ohio 43219, Attn: Corporate Secretary.

The following chart sets forth the responsibilities and duties and current members of each committee, as well as the number of meetings held by each committee in fiscal 2021.

* Independent

† Financially literate under applicable NYSE rules

♦ Audit Committee Financial Expert under applicable SEC rules

Board’s Role in the Risk Management Process

Our Board and its committees play an important role in overseeing the identification, assessment, and mitigation of risks that are material to us. In fulfilling this responsibility, the Board and its committees regularly consult with management to evaluate and, when appropriate, modify our risk management strategies.

The Company implemented an enterprise risk management program (“ERM Program”) in fiscal 2010. Our CEO, who reports to our Board, is the sponsor of the ERM Program. As part of the ERM Program, management provides an annual report to the Board regarding our significant risks and what management is doing to mitigate such risks. Management also updates the Board on significant new risks that are identified on a quarterly basis and reports on what it is doing to mitigate those significant risks. Additionally, the report provides an update on calls received to our Ethics Hotline, an anonymous reporting hotline available to our U.S. and international subsidiaries. The Company believes that its leadership structure supports the risk oversight function of the Board.

Director Nominee Selection

The Nominating and Corporate Governance Committee is responsible for identifying and evaluating potential candidates for nomination as a director. Candidates may come to the attention of the Nominating and Corporate Governance Committee from a variety of sources, including current Board members, shareholders, and management. All candidates (including shareholder nominees) are reviewed in the same manner, regardless of the source of the recommendation. The Nominating and Corporate Governance Committee will consider the recommendations of shareholders regarding potential director candidates. For additional information regarding how to submit a nominee for the 2023 Annual Meeting of Shareholders, see “Shareholder Director Nominees.”

Although there are no specific minimum qualifications that a director candidate must possess, potential candidates are identified and evaluated according to the qualification criteria set forth in the Nominating and Corporate Governance Committee charter, including:

The Nominating and Corporate Governance Committee values diversity and believes directors with different backgrounds and perspectives enhance the effectiveness of the Board. Accordingly, the Nominating and Corporate Governance Committee may take into account various attributes, including background, age, gender, ethnicity, skill set, or viewpoint. Additionally, in November 2021, the Company formalized its diversity policy in its Corporate Governance Principles, which require any search firm engaged by the Board and/or the Nominating and Corporate Governance Committee to include women and minority candidates in the pool from which director candidates are selected. Currently, 40% of our Board is female or ethnically diverse and 60% of our Board is under the age of 65.*

* Ms. Singh-Bushell is included in these statistics. As discussed, Ms. Singh-Bushell is not standing for reelection and, therefore, will no longer serve on the Board after the 2022 Annual Meeting.

Term/Age Limits

As set forth in our Corporate Governance Principles, the Board does not believe it should establish arbitrary term or age limits on directors’ services. While we are committed to Board refreshment, we believe that term or age limits hold the disadvantage of losing the contribution of directors who have been able to develop, over a period of time, increasing insight into the Company and its operations and, therefore, provide an increasing contribution to the Board as a whole. As part of its responsibilities, the Nominating and Corporate Governance Committee evaluates each incumbent director’s qualifications, performance, and ability to continue to contribute productively before recommending the nomination of that director for an additional term.

Annual Board Evaluation

The Board and its committees conduct annual self-evaluations to determine whether they are functioning effectively. As part of the Board’s annual self-evaluation, the Nominating and Corporate Governance Committee receives and reviews comments from all directors and then reports to the Board with an assessment of the Board’s performance. The annual assessment focuses on the Board’s contribution to the Company and specifically focuses on areas in which the Board or management believes that the Board could improve. To the extent improvements are warranted, the Nominating and Corporate Governance Committee establishes a plan to ensure that the improvements are made in a timely and meaningful manner.

Global Code of Conduct and Corporate Governance Information

We have adopted a global code of conduct which applies to all our officers and employees, including our principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions, and an additional code of ethics that applies to senior financial officers. Additionally, the Board has adopted a Director Code of Conduct applicable to our Board members. These codes of ethics, designated by us as the “Global Code of Conduct,” the “Code of Ethics for Senior Financial Officers,” and the “Director Code of Conduct,” respectively, can be found on our corporate and investor website at investors.designerbrands.com/governance-documents and are available in print (without charge) to any shareholder upon request to 810 DSW Drive, Columbus, Ohio 43219, Attn: Corporate Secretary. We intend to disclose any amendment to, or waiver from, any provision of the Global Code of Conduct, Code of Ethics for Senior Financial Officers, or Director Code of Conduct applicable to executive officers and directors by posting such information on our corporate and investor website at investors.designerbrands.com.

Anti-Hedging Policy

Our Insider Trading Policy prohibits all directors, officers (including our NEOs), and associates of Designer Brands Inc. and its subsidiaries from engaging in transactions in financial instruments (including, for example, prepaid variable forward contracts, equity swaps, collars or exchange funds, as well as any other hedging instrument) designed to hedge or offset any decrease in the market value of Designer Brands Inc. stock. Our Insider Trading Policy also prohibits covered persons from holding our stock in a margin account or pledging our stock as collateral for a loan; provided, that individuals who had pledged Designer Brands Inc. stock prior to the adoption of this provision are exempt from this requirement. As disclosed in the “Security Ownership of Certain Beneficial Owners and Management” section of this Proxy Statement, Mr. Tanenbaum pledged 27,746 shares of Designer Brands Inc. stock as security for a line of credit in fiscal 2016. Our Insider Trading Policy is posted on our internal website or available upon request for all associates of Designer Brands Inc. and its wholly owned subsidiaries.

Sustainability, Social Impact and Human Capital

At DBI, we are committed to good corporate citizenship, which means putting our associates first, striving to create positive impacts within our organization, and aiming to better the communities in which we conduct business.

Consistent with our core values of Passion, Accountability, Humility, and Collaboration, we continued to focus on sustainability, philanthropy, and associate engagement during fiscal 2021.

Sustainability

At Designer Brands, we are passionate about shoes and we are passionate about selling them the right way: responsibly. We are focused on making ethical business decisions, caring about the environment, and acting sustainably as an organization. It is what we expect of ourselves and what we expect of our partners. The Company believes in fashion with integrity, and we want our customers to feel good about shopping with us. As a result, we are focused on reducing our consumption of resources, sourcing product responsibly, and being transparent about our efforts to date, which include the following.

ESG Steering Committee and Fiscal 2021 Accomplishments

While we are proud of our current Environmental, Social, and Governance (“ESG”) practices, we are constantly looking for ways to improve. In 2021, we formed the ESG Steering Committee, which is charged with the responsibility of overseeing and furthering our environmental, social, and governance policies, practices, and initiatives. Chaired by our General Counsel and Chief Compliance Officer, the committee is composed of three leaders from the below teams:

Based on the work done by the ESG Steering Committee, we accomplished the following:

We strive to continuously improve our due diligence policies, procedures, and efforts to meet ever-changing local and global environmental, social, and governmental risk and compliance issues. The ESG Steering Committee reports to the full Board on an as-needed basis to ensure that the Board is fully apprised of any significant ESG-related endeavors and risks.

Social Impact

Not only do we strive to create positive impacts within our organization, but we aim to better the communities in which we conduct business. DBI Gives is our philanthropic community interest group whose mission is to inspire community involvement and enhance associate engagement and has three main areas of focus:

DBI Gives partnerships include:

Soles4Souls turns unwanted shoes into opportunity, by keeping them from going to waste and putting them to good use by providing relief, creating jobs, and empowering people to break the cycle of poverty.   Help create jobs and distribute shoes that enable kids to thrive in school.   Support female entrepreneurs with financial empowerment and access to business education.   Repurpose unwanted textiles to keep them out of landfills and extend their lifespan.
Since the inception of our partnership with Soles4Souls in 2018, we are proud to have donated nearly six million pairs of shoes, including almost two million donated in 2021.   Of the nearly six million pairs of shoes that have been donated, a portion of those pairs are new, directly from DSW. We even designed and produced a durable shoe solely for the purpose of donating to Soles4Souls. The remaining pairs of shoes were from customers who donated their gently worn shoes via the donation boxes in each of our stores. We incentivize customers to donate by providing VIP rewards points when they donate. Through the travel program, employees and customers can earn trips to serve the communities in one of our partner countries with every 50,000 pairs of shoes donated.   Additionally, by encouraging customers to donate their shoes, we are also helping to meet our environmental and sustainability goals. By repurposing unwanted shoes, we are helping to keep them out of landfills and extending their lifespan. By collecting discarded shoes and clothing, Soles4Souls has kept 71 million pounds of textiles out of U.S. landfills since its inception.
	The Nationwide Children’s Hospital “On Our Sleeves” program’s mission is to provide every community in America with free resources necessary for breaking child mental health stigmas and educating families and advocates.   In connection with World Mental Health Awareness Day, from August to October 2021, DBI raised nearly $200,000 for On Our Sleeves.
	Two Ten provides scholarships and financial aid to people working in the footwear industry, as well as free counseling and community resources. Many of our own associates have been beneficiaries of the programs Two Ten provides. We support Two Ten with corporate financial donations and subject matter expertise to continue to enrich their community program offerings.   In 2021, DBI donated $200,000 to Two Ten.

DBI is focused on what it means to be a good corporate citizen. From annual United Way fundraisers, American Red Cross blood drives, plus local nonprofit partnerships, and associate volunteering efforts, we are always looking for ways to help and better the communities in which we operate.   In 2021, we received the Dale. E Heydlauff United Way Legacy Award for Outstanding Philanthropy Leadership from Columbus Business First, for the new and innovative partnerships we forged through our point-of-sale campaigns and the creation of the Equity Advancement Fund at United Way of Central Ohio.   In 2021, DBI donated $200,000 and associates donated $204,500 to United Way.

Additionally, we support and encourage our employees to better their communities by providing volunteering opportunities and compensating employees for the hours they volunteer. For associates who elect to volunteer outside of DBI-sponsored opportunities, we may offer donations to the charities of associates’ choice.

Human Capital

We believe the strength of our workforce is critical to our success. Our associates strive every day to create a welcoming and inclusive environment for our customers. One of our core strategies is to invest in and support our associates who are key to differentiating our products and experiences in the competitive footwear market. We monitor and adapt as necessary to maintain our competitive position.

Our key human capital management objectives are to attract, develop, and retain the highest quality talent. To support these objectives, our human resources programs are designed to:

2022 Pensole Partnership: In February 2022, DBI announced an investment of $2 million into advancing action-oriented Diversity, Equity & Inclusion through a partnership with Pensole and legendary footwear designer Dr. D’Wayne Edwards, President of Pensole Lewis College of Business & Design. Located in Detroit, Pensole is the first and only Historically Black College & University (HBCU) in Michigan and the first HBCU with a focus on design. In this new partnership, DBI will invest in the first Black-owned footwear factory in the United States – JEMS by Pensole – to produce shoes designed by Pensole graduate students, to be sold exclusively at DSW.

For more information regarding our human capital management practices, see our 2021 Annual Report on Form 10-K.

AUDIT AND OTHER SERVICE FEES

Our Audit Committee has adopted a policy under which audit and non-audit services to be rendered by our independent registered public accounting firm are pre-approved. The pre-approval policy, which is available on our corporate and investor website at investors.designerbrands.com/governance-documents, is designed to assure that the provision of such services does not impair the independence of our independent registered public accounting firm and is summarized below.

No services were provided by the independent public accountants during fiscal 2021 or fiscal 2020 that were approved by the Audit Committee under SEC Regulation S-X Rule 2-01(c)(7)(i)(C) (which addresses certain services considered de minimis and may be approved by the Audit Committee after such services have been performed).

The following table sets forth the aggregate fees for professional services rendered by Deloitte & Touche LLP, our independent registered public accounting firm, for each of the last two fiscal years.

PROPOSAL 2 – RATIFICATION OF THE APPOINTMENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

The Audit Committee has appointed Deloitte & Touche LLP (“Deloitte”) as our independent registered public accounting firm for the fiscal year ending January 28, 2023. Although we are not required to seek shareholder ratification of the appointment of Deloitte as our independent registered public accounting firm, we are doing so as a matter of good corporate governance. In the event that shareholders do not ratify the appointment of Deloitte, the Audit Committee will reconsider its appointment, but shall have no obligation to retain a new or different independent registered public accounting firm. In addition, even if the shareholders ratify the appointment of Deloitte, the Audit Committee may, in its discretion, appoint a different independent registered public accounting firm at any time during the fiscal year if the Audit Committee determines that a change is in the best interest of the Company and our shareholders.

Representatives of Deloitte are expected to be present by virtual participation at the 2022 Annual Meeting to respond to appropriate questions and to make a statement if such representatives so desire.

Vote Required

Under our Code of Regulations, approval of this proposal requires the affirmative vote of the holders of the greater of (i) a majority of the shares required to constitute a quorum for such meeting, in which case abstentions and broker non-votes have the effect of votes “Against” the proposal, and (ii) a majority of the shares voted on such proposal, in which case abstentions and broker non-votes are disregarded and have no effect on the outcome of the vote.

Your Board of Directors unanimously recommends a vote “FOR” the ratification of the appointment of our independent registered public accounting firm.

AUDIT COMMITTEE REPORT

Our management is responsible for our internal controls and preparing our consolidated financial statements. Our independent registered public accounting firm, Deloitte, is responsible for performing an independent audit of the consolidated financial statements and issuing a report thereon. Their audit is performed in accordance with the standards of the Public Company Accounting Oversight Board (the “PCAOB”). The Audit Committee is responsible for overseeing the conduct of these activities. In performing its oversight function, the Audit Committee relies, without independent verification, on the information provided to it and on representations made by our management and our independent registered public accounting firm.

The Audit Committee met with the internal auditors and independent registered public accounting firm, with and without management present, to discuss the results of their audits, the evaluations of our internal controls, and the overall quality of our financial reporting. The Audit Committee reviewed and discussed with management and Deloitte the audited financial statements for the fiscal year ended January 29, 2022. The Audit Committee reviewed and discussed with the independent registered public accounting firm its judgments as to the quality, not just acceptability, of our accounting principles and such other matters as are required to be discussed relating to the conduct of the audit under the auditing standards of the PCAOB Auditing Standard No. 1301 (Communications with Audit Committees). In addition, the Audit Committee has received the written disclosures and the letter from the independent accountant required by applicable requirements of the PCAOB regarding the independent accountant’s communications with the Audit Committee concerning independence and has discussed with the independent accountant the independent accountant’s independence.

Based on its review of the audited consolidated financial statements and discussions with management and Deloitte referred to above, the Audit Committee recommended to the Board the inclusion of the audited financial statements for the fiscal year ended January 29, 2022, in our Annual Report on Form 10-K for filing with the SEC.

The foregoing Audit Committee Report does not constitute soliciting material and should not be deemed filed or incorporated by reference into any other filing of the Company under the Securities Act or the Exchange Act, except to the extent that the Company specifically incorporates the Report by reference therein.

COMPENSATION DISCUSSION AND ANALYSIS

This Compensation Discussion and Analysis (“CD&A”) describes the goals and objectives of our executive compensation program, including our compensation philosophy, objectives, policies, and practices with respect to our named executive officers (“NEOs”).

Our NEOs for fiscal 2021 were:

Fiscal 2021 Highlights

We are extremely proud of the performance that the Company achieved during fiscal 2021, and believe that our financial results for fiscal 2021 demonstrate the overall strength and resilience of our brand, based on our leadership’s execution of our strategic priorities.

During fiscal 2020, our Company and industry were significantly impacted by the pandemic – we saw a substantial drop in sales and a significant decline in net income. These challenging results were driven by the shutdowns of our stores in response to government mandates and the shift of customer purchases away from our historical areas of strength, such as dress, to athleisure wear.

Despite these challenges and continuing headwinds, our leadership team drove our business to great success in fiscal 2021. Our flexible business model, supported by our dedicated and hardworking associates, has allowed us to emerge from this unprecedented operating environment strongly. We are proud of our accomplishments in fiscal 2021, which included:

We were able to demonstrate resiliency and achieve this standout performance due to the steady leadership of our executive team, bolstered by support from our associates and their dedication to our Company. Because of our team’s hard work coming off of the challenges of the pandemic, the Company exited fiscal 2021 in a position of strength. Despite continuing headwinds in the operating environment, our leadership team has positioned the Company to compete in the new retail environment going forward.

As we look ahead to our strategic growth, we have organized our efforts around three pillars:

Key Elements of Executive Compensation and Changes to Compensation Program for Fiscal 2021

In fiscal 2021, we continued to face intense competitive pressure for talent within an environment that continued to be challenged by the ongoing impacts of the COVID-19 pandemic on our business and industry. We also heard the concerns raised by shareholders and other stakeholders as reflected in the results of the advisory vote on executive compensation for fiscal 2020, or “say on pay.”

Against this backdrop and our continued focus on retaining the best executives for our business, the Compensation Committee of the Board (for purposes of this CD&A, the “Committee”) approved the key elements of our executive compensation program for fiscal 2021 summarized in the chart below, which included several significant changes from fiscal 2020, including:

2021 Shareholder Engagement

Historically, we have received strong shareholder approval for our “say-on-pay” advisory vote. At the 2021 Annual Meeting of Shareholders, approximately 72% of the votes cast were in favor of our 2020 executive compensation, compared to approximately 99% at our 2020 Annual Meeting of Shareholders. During 2021, we broadened our shareholder outreach to non-affiliate shareholders whose combined ownership represents nearly 30% of outstanding Class A common shares and ultimately received feedback from non-affiliate shareholders that cumulatively owned nearly 20% of our outstanding Class A common shares. In addition, the Chair of our Compensation Committee participated in shareholder engagement during fiscal 2021.

Executive Corporate Governance Reinforces Our Compensation Program

Our compensation philosophy for the executive team, including our NEOs, is to attract and retain highly qualified leaders, drive performance by incentivizing our NEOs to attain short- and long-term goals, align the interests of our NEOs with those of our shareholders, and create long-term shareholder value. We continually review leading practices in corporate governance and executive compensation. As appropriate, we consider changes to our program in order to reflect and embrace best practices and remain competitive in our industry.

The following table highlights the Company’s best practices relating to our executive compensation program, and the practices in which the Company does not engage.

Roles in Determining Compensation are Well Defined

Role of the Board of Directors and the Committee: The Committee makes all compensation decisions for our executive officers, including our CEO, the Executive Chairman of the Board, the other NEOs, and non-NEO executive officers. In fiscal 2021, the Committee did not delegate any of its authority with respect to the compensation of any NEO.

Advisory Vote on the Compensation Paid to Named Executive Officers: After multiple years of strong support, our say-on-pay proposal received approximately 72% support at our 2021 Annual Meeting of Shareholders, a marked decline from prior years. As a result, the Committee was focused on shareholder outreach and hearing from shareholders on ways we could improve our compensation programs. The table above under “2021 Shareholder Engagement” sets forth the changes that the Committee made to 2021 executive compensation based on feedback from shareholders and proxy advisory firms. The Committee will continue to evaluate our executive compensation programs, taking into account shareholder feedback.

Role of Executive Officers in Compensation Decisions: The Committee makes all compensation decisions for our NEOs based upon input provided by the Executive Chairman of the Board, the CEO, the independent compensation consultant to the Committee, and certain members of Company management in Human Resources, except with respect to their own compensation. The Committee exercises its discretion and modifies any recommendations that may be provided by Company management and the independent compensation consultant.

Independent Compensation Consultant: The Committee retained Korn Ferry, a global human resources consulting firm, as its independent compensation consultant for fiscal 2021. Korn Ferry provides research, market data, survey, proxy information, and design expertise in developing executive and director compensation programs. As requested by the Committee, Korn Ferry provided the Committee with market data from proprietary databases and publicly available information to consider when making compensation decisions for the NEOs. Korn Ferry also provided similar input to support compensation recommendations and decisions made for Company executives who are not NEOs. The primary Korn Ferry executive compensation consultant attended all Committee meetings in fiscal 2021 and advised the Committee on principal aspects of executive compensation, including the competitiveness of program design and award values and specific analyses for the NEOs and other executive officers. Korn Ferry reports directly to the Committee, and the Committee reserves the right to replace the independent compensation consultant or hire additional consultants or advisers at any time. Korn Ferry was paid approximately $160,000 for these services in fiscal 2021.

Management also engaged Korn Ferry for additional compensation services to the Company in fiscal 2021. The amount of these services was not material. The survey information was used by management for compensation recommendations and market practice assessment for management at all levels. In connection with the engagement of Korn Ferry, the Committee did review the services provided by Korn Ferry to management and determined that Korn Ferry was independent.

Setting Executive Compensation: Generally, the Committee targets NEO pay between the 50th and 75th percentiles of peer group data, subject to adjustment based on the Committee’s assessment of the Company’s and the NEO’s performance. The majority of executive compensation is tied to well-defined, short- and long-term business and performance goals. This pay objective reflects the fact that executives with the skills and experience that we believe are necessary to deliver contributions to drive our long-term business success and intended growth pattern command a premium in the marketplace. Variations to this pay objective may occur as dictated by the experience level of the individual and market factors.

Executive Compensation Objectives

The Committee has developed the following key executive compensation objectives in order to support our business strategy and compensation philosophy:

Proxy Peer Group

The criteria used to select companies for the fiscal 2021 proxy peer group (the “Proxy Peer Group”) included:

The Committee evaluated the actual pay of the NEOs with pay data drawn from proxy-disclosed pay information for the following publicly traded companies, which comprised the Proxy Peer Group:

Due to its bankruptcy and reemergence as a private company, Tailored Brands, Inc. was removed from the Proxy Peer Group for fiscal 2021. Other than this change, the Proxy Peer Group remained unchanged from the 2020 proxy peer group.

For fiscal 2021, the compensation paid to the NEOs was reviewed relative to compensation paid by the Proxy Peer Group to executive officers of similar title and responsibility. By reviewing this publicly available information, as summarized for the Committee by Korn Ferry, the Committee was able to analyze the market competitive pay for each NEO position. The Committee reviews each NEO’s compensation relative to the other NEOs, taking into account each officer’s scope of responsibility, performance, and impact on our business results. In addition to the Proxy Peer Group, the Committee reviewed data from the Korn Ferry 2021 Retail Industry Total Remuneration Report, using data from key competitors, including fashion and specialty retailers. This survey provides information on all key executive jobs at major retailers and is used to supplement the Proxy Peer Group data. This provides the Committee with an understanding of the broader retail market and pay practices for jobs of similar scope and complexity in order to stay competitive in matters of both attracting talented senior executives and retaining high performing executives.

Elements of Executive Compensation

For fiscal 2021, the total compensation of our NEOs generally consisted of the following principal components:

Fiscal 2021 Executive Compensation Mix

In fiscal 2021, aggregate compensation for Mr. Rawlins was approximately 15% fixed compensation (base salary) and 85% variable compensation (based on the target annual cash incentive compensation and grant date value of Mr. Rawlins’ long-term equity incentive compensation). Other NEOs’ compensation consisted of, on average, approximately 28% fixed compensation (base salary) and approximately 72% variable compensation (based on the target annual cash incentive compensation and grant date value of their long-term equity incentive compensation). The chart below reflects details of the compensation for Mr. Rawlins and the other NEOs (on average) in fiscal 2021. The Committee believes the balance was appropriate given the current focus and goals of the Company.

About Our Compensation Elements

I.     Base Salary

Base salaries are determined based on job responsibilities and individual contributions, and with reference to the market data provided by Korn Ferry. As we use base salary as a means to attract and retain our NEOs, our executive compensation program aims to pay base salaries that are competitive with those of the Proxy Peer Group, supplemented with survey data from key competitors from the Korn Ferry 2021 Retail Industry Total Remuneration Report. Accordingly, the salary opportunity for a given position is targeted to be between the 50^th and 75^th percentile of the market data for that position.

In the first quarter of each year, the Committee reviews and determines each NEO’s base salary. During its review, the Committee primarily considers:

The Committee met with Korn Ferry and reviewed market information related to the pay of the Executive Chairman of the Board. After discussing the market information, the Executive Chairman’s role in the Company’s business and other relevant factors, the Board approved a merit-based increase of 3.3% to the Executive Chairman’s base salary in light of the Company’s performance in fiscal 2020.

Base Salary Changes for Fiscal 2021

The following table sets forth the changes to the NEOs’ base salaries during fiscal 2021:

In early fiscal 2021, the Executive Chairman of the Board met with the Committee and reviewed the accomplishments and contributions made by the Company’s Chief Executive Officer, Mr. Rawlins. The Committee also reviewed benchmarking information provided by Korn Ferry. To align his salary more appropriately within the Proxy Peer Group, and in recognition of Mr. Rawlins’ leadership of the Company during fiscal 2020, the Committee approved an 11.6% increase to Mr. Rawlins’ base salary.

The Chief Executive Officer reviewed with the Committee the accomplishments and contributions made by each of the other NEOs under his supervision and recommended increasing the current base salaries of Messrs. Poff and Jordan. After discussing the Company’s financial performance and successful response to the ongoing COVID-19 pandemic, and the recommendations of the Executive Chairman and the Chief Executive Officer, the Committee approved the proposed increases to the base salaries of Messrs. Poff and Jordan.

II.     Performance-Based Short-Term Cash Incentive Plan

The Designer Brands Inc. 2005 Cash Incentive Compensation Plan (as amended and restated, the “ICP”) is designed to promote the achievement of annual performance goals and to focus the NEOs on the short-term objectives that we believe will ultimately contribute to the attainment of long-term business objectives and increases in shareholder value. The NEOs are generally treated the same as all other eligible associates under the ICP. Under the ICP, NEOs are eligible for annual cash incentive awards, the achievement of which is based upon well-defined, pre-established business objectives.

In light of their respective positions and responsibilities, Messrs. Schottenstein’s, Rawlins’, Poff’s, and Jordan’s ICP performance metrics and payouts are solely based on the Company’s overall performance, as opposed to a specific business segment. Ms. Ferrée, however, serves as President of Camuto Group; therefore, her ICP performance metrics and payout are also tied to the performance of the Camuto Group segment. The performance metrics and payout relevant to Ms. Ferrée are discussed below under the subsection entitled “Camuto Bonus Plan.”

The 2021 ICP – the Committee’s Rationale

In the beginning of 2021, the Committee remained cognizant of the challenges in setting performance metrics as a result of the unpredictability of the ongoing COVID-19 pandemic, including uncertainty as to seasonality for our Spring selling season, vaccine approval and acceptance, and continued shifting customer behavior. As of February 2021, FDA-approved vaccines were just becoming available in the U.S. to high-risk individuals and there was no certainty of how effective they would be or how soon they would become available to the broader population (and, once available, what vaccine acceptance levels would look like). These factors made it unclear when the market for our products would return, if at all, to pre-pandemic levels.

In light of the foregoing, the Committee determined that it was in the best interests of the Company to implement two independent six-month short-term incentive plans, with corresponding sets of performance metrics, for fiscal 2021. Specifically, the Committee determined that adopting two six-month incentive plans was appropriate for the following reasons:

Accordingly, in January 2021, the Committee approved a six-month incentive plan for the first and second quarters of fiscal 2021 (the “2021 Q1/Q2 ICP”) and in August 2021, the Committee approved a six-month incentive plan for the third and fourth quarters of fiscal 2021 (the “2021 Q3/Q4 ICP” and, together with the 2021 Q1/Q2 ICP, the “2021 ICP”). In both instances, the financial goals and strategic objectives of each plan were based on the Company’s operating budget for the first and second quarters and the third and fourth quarters, as applicable. Descriptions of the 2021 ICP follows.

The 2021 ICP – Incentive Levels

Early in fiscal 2021, the Committee established each NEO’s incentive bonus opportunity for the 2021 Q1/Q2 ICP as a percentage of his earnings during the six-month performance period and repeated this process in August 2021 to establish incentive bonus opportunities for the 2021 Q3/Q4 ICP. For continuity, the incentive levels for each NEO were identical for both 2021 ICPs.

In determining the target incentive levels for each NEO, the Committee considered the individual’s position and contribution to business performance, as well as market data and recommendations from the independent compensation consultant. For the 2021 ICPs, these levels ranged from 60% to 150% for the NEOs, as shown in the table below.

In setting the threshold, target, and maximum payouts, the Committee may consider specific circumstances facing the Company during the prior year. Threshold, target and maximum payouts are based on the Company’s achievement of the performance goals at the applicable level (50%, 100%, and 200% of the target payout, respectively). We do not make payouts below the threshold level.

2021 Q1/Q2 ICP - Performance Metric

In January 2021, the Committee approved using Adjusted Operating Profit or Loss as the performance metric for the 2021 Q1/Q2 ICP. The Committee selected this performance metric as it believes that Adjusted Operating Profit or Loss provides a meaningful understanding of our core financial operating performance and is a key financial metric used by management and other stakeholders.

In setting the payout thresholds for the 2021 Q1/Q2 ICP, the Committee considered the following:

The table below sets forth the performance ranges, corresponding payout goals, and actual performance achievement for the 2021 Q1/Q2 ICP:

The 2021 Q1/Q2 ICP - Determining Payout

Achievement of the performance goal is obtained by calculating the Adjusted Operating Profit or Loss results for the first and second quarters of fiscal 2021, combined, and then determining the corresponding level of payment. Payout levels between the threshold, target, and maximum amounts are determined based on linear interpolation.

As calculated above, the Company achieved $87.0 million in Adjusted Operating Profit for the six-month performance period. While this was $167.0 million above the target amount, payout under the 2021 Q1/Q2 ICP was capped at 200% payout.

The 2021 Q1/Q2 ICP – NEO Payouts

The amounts paid to the NEOs for the 2021 Q1/Q2 ICP are reflected in the table below. Unless otherwise determined by the Committee, all associates who participate in the ICP (including the NEOs) are governed by the same plan parameters. Payments for the 2021 Q1/Q2 ICP were paid on September 10, 2021 to eligible participants, including the NEOs.

The 2021 Q3/Q4 ICP - Incentive Levels

In August 2021, the Committee established incentive bonus opportunities for the 2021 Q3/Q4 ICP, with incentive bonus targets and payout opportunities consistent with the 2021 Q1/Q2 ICP described above.

The 2021 Q3/Q4 ICP - Performance Metrics

The Committee determined that performance metric for the 2021 Q3/Q4 ICP would continue to be based on Adjusted Operating Profit or Loss, at significantly more challenging levels than what the Committee set for the first six months of the fiscal year. The following table sets forth the performance goals, corresponding payout opportunities, and actual performance achievement for the 2021 Q3/Q4 ICP.

The 2021 Q3/Q4 ICP - Determining Payout

Achievement of the performance goal is obtained by calculating the Adjusted Operating Profit or Loss results for the third and fourth quarters of fiscal 2021, combined, and then determining the corresponding level of payment. Payout levels between the threshold, target, and maximum amounts are determined based on linear interpolation. As calculated above, the Company achieved $139.5 million in Adjusted Operating Profit for the six-month performance period. While this level of achievement exceeded the maximum goal set under the 2021 Q3/Q4 ICP, payout was capped at 200% payout.

The 2021 Q3/Q4 ICP – NEO Payouts

The amounts paid to the NEOs for the 2021 Q3/Q4 ICP are reflected in the table below. Unless otherwise determined by the Committee, all associates who participate in the ICP (including the NEOs) are governed by the same plan parameters. Payments for the 2021 Q3/Q4 ICP were paid on March 25, 2022 to eligible participants, including the NEOs.

2021 ICP – Combined Payout

The cash incentive plan amounts paid to the NEOs for fiscal 2021 are reflected in the table below and in the Non-Equity Incentive Plan Compensation column of the Summary Compensation Table. Unless otherwise determined by the Committee, all associates who participate in the ICP (including the NEOs) are governed by the same plan parameters.

Camuto Bonus Plan

As discussed above, Ms. Ferrée, as President of Camuto Group, participates in the Camuto Bonus Plan. Like the 2021 ICP, the Camuto Bonus Plan consisted of two independent six-month short-term incentive plans, with corresponding sets of performance metrics, for fiscal 2021. Accordingly, in January 2021, the Committee approved a six-month incentive plan for the first and second quarters of fiscal 2021 applicable to the Camuto Group (the “2021 Q1/Q2 CBP”) and in August 2021, the Committee approved a six-month incentive plan for the third and fourth quarters of fiscal 2021 applicable to the Camuto Group (the “2021 Q3/Q4 CBP” and, together with the 2021 Q1/Q2 CBP, the “2021 CBP”). The following provides a summary of the 2021 CBP.

2021 CBP - Incentive Levels

For the 2021 CBP, the Committee maintained the same practice in setting incentive levels as it did for the 2021 ICP described above. Accordingly, the Committee approved Ms. Ferrée’s incentive level for the 2021 Q1/Q2 CBP in early fiscal 2021 and her incentive level for the 2021 Q3/Q4 CBP in August 2021, both of which were as follows:

2021 Q1/Q2 CBP - Performance Metrics

In January 2021, the Committee approved using the following two equally-weighted performance metrics for the 2021 Q1/Q2 CBP:

The table below sets forth the performance ranges, corresponding payout goals, and actual performance achievement for the 2021 Q1/Q2 CBP:

2021 Q1/Q2 CBP – Payout

The amount paid to Ms. Ferrée for the 2021 Q1/Q2 CBP is reflected in the table below. Payments for the 2021 Q1/Q2 CBP were paid on September 10, 2021 to eligible participants, including Ms. Ferrée.

2021 Q3/Q4 CBP - Performance Metrics

The Committee determined that performance metrics for the 2021 Q3/Q4 CBP would continue to be based on:

The table below sets forth the performance ranges, corresponding payout goals, and actual performance achievement for the 2021 Q3/Q4 CBP:

2021 Q3/Q4 CBP – Payout

The amount paid to Ms. Ferrée for the 2021 Q3/Q4 CBP is reflected in the table below. Payments for the 2021 Q3/Q4 CBP were paid on March 25, 2022 to eligible participants, including Ms. Ferrée.

2021 CBP – Combined Payout

The cash incentive plan amounts paid to Ms. Ferrée for fiscal 2021 are reflected in the table below and in the Non-Equity Incentive Plan Compensation column of the Summary Compensation Table.

Camuto Group Leadership

In recognition of her accomplishments as President of Camuto Group, in addition to Vice Chair, during fiscal 2021, including the revitalization of the Vince Camuto brand, the relaunch of JLO Jennifer Lopez, improvement to product design and quality, and overall effectiveness of the Camuto leadership team, the Committee awarded Ms. Ferrée a cash bonus of $300,000, which is reflected in the Bonus column of the Summary Compensation Table.

III. Long-Term Equity Incentive Compensation

We believe that our executive officers are in a position to make substantial contributions to the long-term success of the Company and should have a significant portion of compensation tied to that success. Long-term compensation creates a pay-for-performance culture that provides an incentive to contribute to the continued growth and development of our business and aligns the interests of executive officers with those of our shareholders. Ultimately, this promotes the retention of our executive officers and creates the potential to maximize shareholder value. Our long-term incentive compensation utilized the following types of award grants to achieve these goals, with each award weighted equally (i.e., 50%):

Fiscal 2021 Long-Term Equity Incentive Awards

In determining the value of annual long-term equity incentive grants, the Committee’s overall objective is consistent with our executive compensation philosophy to target the total grant value between the 50th and 75th percentile of the Proxy Peer Group long-term incentive awards. Accordingly, in determining the grant date value for the fiscal 2021 long-term incentive awards, the Committee considered market data from Proxy Peer Group companies provided by Korn Ferry, as well as performance and retention concerns for each NEO. The Committee believes the fiscal 2021 long-term incentive awards provide an appropriate incentive to the leadership team to focus on long-term shareholder value creation and, at the same time, provide the Company with the retention value necessary in a competitive labor market. The fiscal 2021 performance share and RSU awards were granted in March 2021 as part of the annual performance review process and were made under the Designer Brands Inc. 2014 Long-Term Incentive Plan (as amended and restated, the “LTI Plan”), which was first approved by shareholders in 2014 and amended and restated in 2020.

The information below reflects the annual long-term incentive awards granted to the NEOs in fiscal 2021, which represented an equal split between performance shares and time-based RSUs.

Performance Shares

Performance shares reward NEOs in proportion to the Company’s financial performance, based on the Company’s Adjusted Operating Profit during the one-year performance period, and are further linked to the Company’s long-term performance due to a cliff vesting feature that extends vesting of the underlying shares for two years beyond the conclusion of the performance period. Performance shares vest 100% on the third anniversary of the grant date if the one-year threshold performance has been achieved; if the performance goal is not met, the performance shares are forfeited in their entirety.

In the first 90 days of the fiscal year, the Committee establishes the minimum, target, and maximum levels of performance used to determine the potential number of shares earned, as shown in the table below. The 2021 performance shares were granted on March 23, 2021 and based on a grant date fair value of $15.38.

For fiscal 2021, the Committee selected Adjusted Operating Profit, as the performance metric as it believes that this metric provides a meaningful understanding of our core financial operating performance and is a key financial metric used by management and other stakeholders.

The following table shows the target performance goals, corresponding payout opportunities, and actual performance results for fiscal 2021 performance share awards.

Based on the above, NEOs earned 150% of their target performance share grant, as follows:

Restricted Stock Units (RSUs)

RSUs provide retention value because they generally vest 100% at the end of three years from the grant date. Since the stock unit value is tied directly to the market value of the Company’s common stock, and not exclusively to an increase in the market value of the Company’s common stock, they provide retention value even when the stock price is stable or declining.

Vesting of Fiscal 2018 Awards

In fiscal 2018, the Committee granted long-term equity incentive awards to the NEOs that consisted of performance shares and time-based RSUs granted to Messrs. Schottenstein, Rawlins, Poff, and Jordan and Ms. Ferrée. As disclosed in the Company’s 2019 proxy statement, the performance shares awards vested based on a maximum payout percentage following the end of fiscal 2018 and remained subject to time-based vesting requirements that lapsed in early fiscal 2021. See the Fiscal Year 2021 Stock Vested Table for more information about the vesting of the performance shares and RSUs during fiscal 2021.

Benefits and Other Compensation Elements

401(k) Plan

The Company sponsors a tax-qualified 401(k) plan (the “401(k) Plan”), in which all eligible associates, including the NEOs, can participate. Under the 401(k) Plan, participants are able to contribute up to 50% of their total eligible cash compensation (including base salary and annual cash incentive compensation) on a pre-tax or after-tax basis up to the limits imposed by the Internal Revenue Code of 1986, as amended (the “Code”). The maximum allowable per participant deferral in 2021 under the Code was $19,500 ($26,000 if at least age 50). The Company provides a 100% match on the first 3% contributed by a participant and an additional 50% match on the next 2% contributed by a participant. All matching contributions are 100% vested. Matching contributions are not made by the Company until participants have completed at least six months of service with the Company. In light of the matching contribution for participants, and under § 401(a)(17) of the Code, the maximum allowable per participant annual company matching contribution in 2021 was $11,600. Participants can choose to invest their account balances in an array of investment alternatives (some of which are target date funds) as selected by plan fiduciaries. The Company’s stock fund is not among the investment alternatives available to plan participants. The 401(k) Plan allows multiple distribution options of all vested balances after termination of service. However, loans and in-service distributions under certain circumstances, such as a hardship, attainment of age 59-1/2, or a disability, are permitted for participants who are still active with the Company.

Nonqualified Deferred Compensation Plan

The Company sponsors a nonqualified retirement plan (the “Nonqualified Plan”), in which a select group of management and other highly-compensated associates, including NEOs, may participate. The Company does not provide a company matching contribution in the Nonqualified Plan. In fiscal 2021, none of the NEOs participated in the Nonqualified Plan.

Under the Nonqualified Plan, eligible associates may contribute up to 80% of their base salary and 90% of their monthly and/or annual bonus on a pre-tax basis. Deferral elections are made annually related to future compensation, in compliance with §409A of the Code. Participating associates who also participate in the 401(k) Plan may earn a 401(k) make-up contribution if their contributions to the Nonqualified Plan reduce the matching contributions they receive in the 401(k) Plan. In order to maintain the Nonqualified Plan’s tax-deferred status, Nonqualified Plan assets are subject to the claims of the Company’s creditors. Participants choose to invest their account in an array of investment alternatives that generally mirror the investment alternatives under the 401(k) Plan. The Nonqualified Plan allows for in-service distributions in a lump sum. The Nonqualified Plan also allows for retirement distributions which are permitted as a lump sum in three (3), five (5), or ten (10) annual installments. Distribution elections are made when deferral elections are made in compliance with § 409A of the Code.

Termination and Change in Control Arrangements

The currently employed NEOs (other than Mr. Schottenstein) have employment agreements that entitle them to receive certain benefits and payments if their employment terminates in specified separation scenarios. All of the currently employed NEOs (and all participants in the LTI Plan) are entitled to certain payments or benefits upon a change in control, including potential acceleration of the vesting of

outstanding equity awards pursuant to the LTI Plan. These arrangements are described under the Potential Payments upon Termination and Change in Control section. The employment agreements do not include specific amounts of salary, bonus opportunities, or equity-based compensation for future years.

Other Benefits and Perquisites

Our NEOs receive a limited amount of other benefits as part of a competitive compensation package. These benefits include, as discussed above, a Company matching contribution under our 401(k) Plan, which is available to all employee participants. We provide our Executive Chairman with certain security services through the Company. Additionally, from time to time, we have paid for relocation costs. No relocation costs were paid to any NEO in fiscal 2021. In the aggregate, these other benefits constitute only a small percentage of each NEO’s total compensation.

Executive Compensation Governance

Equity Grant Practices

Under the LTI Plan, the Committee approves all equity awards and has not delegated to management the authority to approve equity awards. The Chair of the Committee has authority to approve equity awards in situations where it is not practical to bring the Committee together for such a purpose.

The Committee has a longstanding methodology to determine the grant date on which annual equity awards would be granted to eligible associates. The Committee determined that the annual equity grant date would be the seventh calendar day following the Company’s fiscal year-end earnings release. The Committee also reviews and considers approval of off-cycle equity awards recommended by management. These off-cycle equity awards reflect commitments made by the Company, subject to approval by the Committee, and are for current associates (generally in the case of promotion or retention), new hires who have already become employees of the Company, or prospective hires who have agreed to a start date with the Company. The grant date for current associates, and for new hires who have already become employees of the Company, is the date set by the Committee. The grant date for prospective hires is generally their future start date. Additionally, the Committee does not coordinate equity grants so that they are made before announcement of favorable information or after announcement of unfavorable information.

Stock Ownership Guidelines

The Company has implemented a stock ownership guideline for the CEO. Under this guideline, Mr. Rawlins is encouraged to hold shares of the Company’s stock with a value at least equal to one (1) times his annual base salary, to be achieved within three years of becoming CEO. Counting only directly-owned, fully-vested shares, Mr. Rawlins owned shares representing more than six times the ownership guideline as of April 1, 2022.

Clawback Recoupment Policy

The LTI Plan includes a compensation recoupment, or “clawback,” provision that allows the Company to recover payment relating to awards granted under the LTI Plan in certain circumstances, including if a participant engages in fraudulent conduct or activities relating to the Company or a participant knew or should have known of such conduct or activities. Additionally, the LTI Plan gives the Committee the authority to recoup certain compensation in the event that the Company restates its financial statements and, as a result of such restatement, the amount of compensation that would have been paid or payable pursuant to an award granted under the LTI Plan would have been lower had the financial results been properly reported. This policy is in addition to any requirements that might be imposed pursuant to applicable law.

Tax Considerations

§ 162(m) of the Code generally limits deductibility of compensation that a publicly traded company pays to certain “covered employees,” up to $1 million per year. Covered employees for this purpose include the Company’s Chief Executive Officer, Chief Financial Officer, the next three most highly compensated executive officers, and any such “covered employee” for a year after 2016. While the Committee considers tax consequences to the Company as a factor when it makes compensation determinations, the Committee reserves discretion to award compensation that is not fully deductible under Code § 162(m) if the Committee believes that such compensation will best attract, retain, and reward executives and contribute to our business objectives.

REPORT OF THE COMPENSATION COMMITTEE

The Compensation Committee has reviewed and discussed the foregoing Compensation Discussion and Analysis with management. Based on the Compensation Committee’s review and discussion with management, the Compensation Committee has recommended to the Board of Directors, and the Board of Directors has approved, that the Compensation Discussion and Analysis be included in this Proxy Statement.

The foregoing Compensation Committee Report does not constitute soliciting material and should not be deemed filed or incorporated by reference into any other filing of the Company under the Securities Act or the Exchange Act, except to the extent that the Company specifically incorporates the Report by reference therein.

COMPENSATION TABLES

SUMMARY COMPENSATION TABLE

The following table summarizes compensation earned by each of the NEOs during fiscal 2021, fiscal 2020, and fiscal 2019.

FISCAL YEAR 2021 GRANTS OF PLAN-BASED AWARDS

OUTSTANDING EQUITY AWARDS AT FISCAL YEAR-END 2021

The following table provides information regarding outstanding equity awards held as of January 29, 2022 by each of the NEOs.

FISCAL YEAR 2021 OPTION EXERCISES AND STOCK VESTED

The following table provides information regarding the exercise of stock options and vesting of restricted stock units and performance-based stock units during the year ended January 29, 2022 for the NEOs.

FISCAL YEAR 2021 NONQUALIFIED DEFERRED COMPENSATION

Potential Payments Upon Termination and Change in Control

Employment Agreements with Named Executive Officers

Mr. Rawlins, Mr. Poff, Ms. Ferrée, and Mr. Jordan have employment agreements with the Company that provide for payments and benefits following termination of their employment without “cause.” The agreement with Ms. Ferrée also includes payments and benefits if she terminates employment for “good reason.” Mr. Jay Schottenstein does not have an employment agreement with us.

Generally, pursuant to the NEOs employment agreements (other than Mr. Schottenstein, who does not have an employment agreement), if the Company involuntarily terminates the NEO’s employment without “cause,” and in the case for Ms. Ferrée, if she terminates her employment for “good reason,” each NEO (other than Mr. Schottenstein) is entitled to receive the following:

Also, pursuant to the ICP if employment terminates as a result of death or disability, the NEO is entitled to receive a pro-rata share of any annual cash incentive bonus paid for performance in the fiscal year in which the termination occurs, but only if the performance criteria applicable to that performance period are met at the end of that performance period.

Each NEO’s employment agreement also contains confidentiality and non-disparagement provisions effective through the term of their agreement, a non-competition provision effective through the longer of one year following termination of employment or the period of any salary continuation (or, in the case of Mr. Rawlins, 18 months), and a non-solicitation provision effective through the longer of two years following termination of employment or the period of any salary continuation. Under these employment agreements, an NEO’s receipt of benefits is conditioned on their compliance with the above provisions. In addition, as a part of their employment agreements, NEOs are required to execute a release of any claims against the company the NEO may have related to their employment.

Equity Plans

Currently, the Company has two equity incentive plans in place under which awards are outstanding: the 2005 Designer Brands Inc. Equity Plan (the “2005 Equity Plan”) and the LTI Plan, which was approved by shareholders at the 2020 Annual Meeting of Shareholders. Pursuant to our 2005 Equity Plan and any applicable award agreement executed in accordance therewith and applicable award agreements executed in accordance with the LTI Plan, prior to January 1, 2018, termination by reason of death, disability or retirement (defined as termination after reaching age 65 and completing at least five years of employment) entitles each NEO to receive accelerated vesting with respect to all equity awards that are not vested as of the date of termination. For awards granted on or after January 1, 2018, there is no automatic right to full vesting of awards upon a participant’s retirement under the LTI Plan.

The LTI Plan provides for accelerated vesting of equity awards granted thereunder upon certain qualifying employment terminations following a change in control.

In the event of a change in control (as defined in the LTI Plan) and to the extent that outstanding awards are not assumed by a successor entity or replaced with a replacement award: (i) all options and stock appreciation rights will immediately vest and become exercisable; (ii) the restrictions on all shares of restricted stock will lapse and all RSUs will vest immediately; and (iii) all performance awards will immediately vest and be considered earned and paid in full “at target” as if the applicable performance goal had been achieved.

Additionally, the Compensation Committee may provide in the applicable award agreement, that if, within two years of a change in control, a plan participant is involuntarily terminated by the Company for reasons other than cause, or good reason, then (i), (ii), and (iii) above shall occur. The Compensation Committee, as constituted before a change in control, may also provide for the cancellation of an award for an amount of cash equal to the difference between the exercise price and the then fair market value of the shares of Class A common stock had such award been currently exercisable, make any adjustment deemed appropriate to reflect the change in control, or cause an outstanding award to be assumed by the successor entity after the change in control.

Quantitative Information Upon a Change in Control

The estimated value of the benefits described above are presented in the following table and are calculated as if the respective termination or change in control event occurred on January 29, 2022 and our stock price was $12.79, the closing market price of our Class A

Common Shares on January 28, 2022, the last trading day of fiscal 2021 in case of termination and, as applicable, $14.82 in the case of change in control based on the calculation methodology specified in our 2005 Equity Plan. The salary continuation amounts below are based on each NEO’s salary as of the end of fiscal 2021. The actual amounts to be paid will only be determinable at the time of actual payment.

FISCAL 2021 POTENTIAL TERMINATION AND CHANGE IN CONTROL PAYMENTS

achieved as of the end of the performance period. The amounts shown represent target awards under the 2021 Q1/Q2 ICP and the 2021 Q3/Q4 ICP (2021 Q1/Q2 CBP and 2021 Q3/Q4 CBP for Ms. Ferrée); for additional information regarding the 2021 Q1/Q2 ICP, the 2021 Q3/Q4 ICP, the 2021 Q1/Q2 CBP, and the 2021 Q3/Q4 CBP see the “Performance-Based Short-Term Cash Incentive Plan” subsection of the CD&A.

CEO Pay Ratio

We are providing the following disclosure related to our Chief Executive Officer’s compensation as compared to the compensation of all of our employees, other than our Chief Executive Officer, pursuant to Item 402(u) of Regulation S-K, as adopted by the SEC. The pay ratio included in this information is a reasonable estimate calculated in a manner consistent with Item 402(u) of Regulation S-K.

Our median employee is a part-time sales associate in one of our DSW stores, who worked, on average, approximately 23 hours per week. Due to the significant changes in our associate population, we have selected a new median employee.

The median employee was determined using a consistently applied compensation measure. The method used to identify the median employee was to first rank-order all employees (including full-time, part-time, seasonal, and temporary, but excluding the Chief Executive Officer) employed as of January 29, 2022, based on total earnings, and then to select the middle employee. Total earnings included all wages reported to the IRS and Canadian Revenue Agency as taxable wages. For the purposes of the disclosure, we converted the compensation elements paid to our employees in Canada from Canadian dollars to U.S. dollars using the Bank of Canada’s fiscal year 2021 average exchange rate of 0.80. No other adjustments were made to the total earnings.

In identifying the median employee using the method described above, we excluded approximately 28 employees in Brazil and approximately 181 employees in China because these employees represent less than 5% of our workforce, as permitted under the de minimis exemption to the SEC rules.

Mr. Rawlins had a 2021 annual total compensation of $9,735,429, as reflected in the Summary Compensation Table included in this Proxy Statement. Our median employee’s annual total compensation for fiscal 2021 determined on the same basis was $12,543. As a result, the ratio of the annual total compensation of the CEO to the annual total compensation of the median employee of the Company was approximately 776:1.

Compensation Committee Review of the Relation of Compensation Design to Risk

The Compensation Committee has reviewed the design and operation of our compensation policies and practices, including incentive compensation arrangements for our NEOs. The Compensation Committee has determined that the Company’s compensation policies and practices do not encourage our employees to take unnecessary or inappropriate risks that could reasonably be expected to materially threaten our value. Several factors contributed to this assessment, including the following:

On the basis of its review of our executive compensation programs, the Compensation Committee concluded that the risks of these compensation programs are mitigated and are not reasonably likely to have a material adverse effect on Designer Brands Inc. Accordingly, no material adjustments were made to our compensation policies and practices. We will continue to monitor our compensation policies and practices to determine whether our risk management objectives are being met with respect to incentivizing the Company’s employees.

COMPENSATION OF DIRECTORS

Our Compensation Committee reviews director compensation and makes recommendations to our Board regarding director compensation.

Our current director compensation policies provide that each non-employee director will receive: