Atlassian (TEAM) DEF 14ADefinitive proxy

We also will consider any other matters that may properly be brought before the Annual Meeting (and any postponements or adjournments of the Annual Meeting). As of the date of this Proxy Statement, we have not received notice of any such matters.

Holders of record of shares of our Class A Common Stock and/or Class B Common Stock at the close of business on October 14, 2024 and their proxies are entitled to receive notice of, and to vote at, the Annual Meeting and any and all adjournments, continuations, or postponements thereof. These proxy materials are first being made available to stockholders on October 23, 2024.

By order of the Board of Directors,

This Proxy Statement contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and the Private Securities Litigation Reform Act of 1995, which statements involve substantial risks and uncertainties. In some cases, you can identify these statements by forward-looking words such as “may,” “will,” “expect,” “believe,” “anticipate,” “intend,” “could,” “should,” “estimate,” or “continue,” and similar expressions or variations, but these words are not the exclusive means for identifying such statements. All statements other than statements of historical fact could be deemed forward looking, including statements about our products, product features, including AI capabilities, customers, leadership, business priorities and strategy, market potential, environmental, social and governance efforts, sustainability goals, Team Anywhere, and the goals or effects of our executive compensation programs.

We undertake no obligation to update any forward-looking statements made in this Proxy Statement or to reflect events or circumstances after the date of this Proxy Statement or to reflect new information or the occurrence of unanticipated events, except as required by law.

The achievement or success of the matters covered by such forward-looking statements involves known and unknown risks, uncertainties and assumptions. If any such risks or uncertainties materialize or if any of the assumptions prove incorrect, our results could differ materially from the results expressed or implied by the forward-looking statements we make. You should not rely upon forward-looking statements as predictions of future events. Forward-looking statements represent our management’s beliefs and assumptions only as of the date such statements are made.

Website references throughout this Proxy Statement are provided for convenience only, and the content on the referenced websites is not incorporated by reference into this Proxy Statement.

Unless otherwise indicated, all reference to “$,” “USD $,” “US dollars,” and “dollars” are to United States dollars and all reference to “AUD $” are to Australian dollars.

The Board of Directors (the “Board”) of Atlassian Corporation is soliciting your vote for Atlassian’s 2024 Annual Meeting of Stockholders (the “Annual Meeting”). Unless otherwise indicated, references in this proxy statement (the “Proxy Statement”) to “Atlassian,” “we,” “us,” “our” and the “Company” refer to Atlassian Corporation.

Atlassian has embraced remote work through our Team Anywhere approach. The vast majority of Atlassians have flexibility in where they work – whether in an office, from home, or a combination of the two. Team Anywhere means, in part, that we aim to give all Atlassians the same ability to connect no matter from where they join our team.

In keeping with the Team Anywhere philosophy, we are utilizing a virtual meeting format for the Annual Meeting to provide a consistent experience to all stockholders regardless of geographic location. We also believe that the virtual meeting format enhances stockholder access and engagement and reduces the environmental impact of our Annual Meeting. In structuring our virtual Annual Meeting, our goal is to enhance rather than constrain stockholder participation in the meeting, and we have designed the meeting to provide stockholders with the same rights and opportunities to participate as they would have at an in-person meeting.

Pursuant to the rules of the SEC we have provided access to our proxy materials primarily over the internet. Accordingly, a Notice of Internet Availability of Proxy Materials (the “Internet Notice”) has been mailed (or, if requested, emailed) to our stockholders owning our stock as of the record date, October 14, 2024. Our proxy materials were mailed to those stockholders who have asked to receive paper copies. Instructions on how to access the proxy materials over the internet, receive our proxy materials via email, or request a printed copy by mail may be found in the Internet Notice.

By accessing the proxy materials on the internet or choosing to receive your future proxy materials by email, you will reduce the cost of printing and mailing documents to you and will reduce the impact the Annual Meeting has on the environment. If you choose to receive future proxy materials by email, and you are an Atlassian stockholder as of the record date for next year’s annual meeting, you will receive an email next year with instructions containing a link to those materials. If you choose to receive future proxy materials by mail, you will receive a paper copy of those materials, including a form of proxy or voting instruction form. Your election to receive proxy materials by mail or email will remain in effect until you notify us that you are terminating such election.

Our mission is to unleash the potential of every team. Through a connected portfolio of products with discrete value propositions that are built on the Atlassian platform and data model, the Atlassian System of Work gives all teams the right teamwork foundations so they can plan and track work, align on goals, and unleash knowledge across the organization. The Atlassian platform is the common technology foundation for our products and solutions that drives connection between teams, information, and workflows across the entire organization. Additionally, we help leadership teams gain actionable insights and visibility across their organizations and deliver solutions for specialized teams, like product and development teams and IT operations and support teams.

Our primary products include Jira for planning and project management, Confluence for content creation and sharing, Jira Service Management for team service, management, and support applications, and Loom for asynchronous video collaboration. Together, our connected portfolio of products form integrated solutions that are deeply entrenched in how teams collaborate and how organizations run, and provide customers all the benefits of analytics, automation, and now AI, as well as integrations with thousands of third-party apps.

In fiscal year 2024, we achieved strong business and financial results, including:

Our Board is composed of highly experienced directors who have led, advised and established leading global organizations. Our Board has taken a thoughtful approach to board composition so that our directors have backgrounds that collectively add significant value to the strategic decisions made by Atlassian and that enable them to provide oversight of management and accountability to our stockholders. Our directors have extensive backgrounds as entrepreneurs, technologists, operational and financial experts, investors, executives, and advisors. In addition, we have worked hard to strike a balance between long-term understanding of our business and fresh external perspectives, as well as to have a diversity of backgrounds and perspectives within the boardroom.

The following table sets forth the names, ages, and certain other information for each of our director nominees. It also includes the membership of our standing committees that are expected to remain in effect following the Annual Meeting if all the director nominees are elected.

In accordance with Nasdaq Listing Rule 5605(f), the following chart shows certain self-identified personal characteristics of our directors as of September 30, 2024:

Set forth below are the names and certain information about each of our director nominees, all of whom are currently members of the Board. There are no family relationships among any of our directors or executive officers. Our directors serve until the next annual meeting of stockholders and until their successors are elected and qualified, subject to earlier resignation or removal. Please see Proposal 1 in this Proxy Statement for more information about the election of our directors.

As required by the Nasdaq listing standards, a majority of the members of our Board must qualify as “independent,” as affirmatively determined by our Board. Our Board consults with our legal counsel to ensure that its determinations are consistent with all relevant securities and other laws and regulations regarding the definition of “independent,” including those set forth in the applicable Nasdaq listing standards. In addition, in making its determination, the Board considers any arms-length transactions made in the ordinary course between Atlassian and certain related entities, for instance the purchase from Atlassian of software products and services by companies of which a director is an executive officer and vice versa.

After review of all relevant transactions and relationships between each director, any of their family members, Atlassian, our executive officers and our independent registered public accounting firm, the Board has affirmatively determined that a majority of our Board is comprised of independent directors. Our current independent directors are: Mr. Belsky, Dr. Brown, Ms. Fernandez, Mr. Goodarzi, Mr. Parikh, Mr. Salem, Mr. Sordello, Mr. Wong, and Ms. Zatlyn.

The Board also concluded that all members of each of the Audit Committee, Compensation and Leadership Development Committee (the “CLDC”) and the Nominating Committee are independent within the meaning of our Corporate Governance Guidelines and Nasdaq listing standards, including the additional independence requirements applicable to members of the Audit Committee and the CLDC.

Each year, the Board appoints a Board Chair, reviews its leadership structure and determines whether, at the time, it is in the best interests of Atlassian and our stockholders for the role of Board Chair to be held by someone other than our CEO. When the same person serves as both Board Chair and CEO, the independent directors may appoint a Lead Independent Director.

Currently, the roles of Board Chair and CEO are separated. In September 2024, Dr. Brown was re-appointed as Board Chair. At this time, the Board has determined that it is not necessary to appoint a Lead Independent Director given that the Board has determined Dr. Brown to be independent. The Board believes this governance structure, which consists of an independent Board Chair, a CEO (who is also a director), and a majority of independent, engaged directors, is optimal at this time for guiding our company and maintaining the focus required to achieve our business goals. In particular, Atlassian and our Board recognize the importance of the effective oversight that is provided by our independent Board members.

While separation of the Board Chair and CEO roles is not required under our Bylaws or Corporate Governance Guidelines, the Board believes that at this time it is appropriate for us and in the best interests of Atlassian and our stockholders. The Board believes this structure provides an effective balance between strong company leadership and oversight by independent directors with expertise from outside Atlassian, as it enables Mr. Cannon-Brookes to focus his attention on our business strategy and operations.

During our fiscal year ended June 30, 2024, our Board held ten meetings. Each director attended at least 75% of the aggregate of (i) the total number of meetings of our Board held during the period for which he or she has been a director and (ii) the total number of meetings held by all committees of our Board on which he or she served during the periods that he or she served.

Although we do not have a formal policy regarding attendance by members of our Board at annual meetings of stockholders, we encourage, but do not require, our directors to attend. Two of the then-serving members of our Board attended the 2023 Annual Meeting of Stockholders.

Our Board has established the Audit Committee, the CLDC, and the Nominating Committee.

During fiscal year 2024, Dr. Brown and Messrs. Goodarzi and Parikh served on the CLDC. Mr. Belsky joined the CLDC concurrently with his Board appointment on August 1, 2024. None of the members of the CLDC has been an officer or employee of Atlassian. None of our executive officers serves on the board of directors or compensation committee of a company that has an executive officer that serves on the Board or the CLDC.

The Nominating Committee uses a variety of methods for identifying and evaluating director nominees. Candidates may come to the attention of the Nominating Committee through directors, management, stockholders or third parties. The Nominating Committee and the Board believe it is in the best interests of Atlassian and its stockholders to obtain highly qualified individuals to serve on the Board.

The Nominating Committee regularly assesses the appropriate size, composition and needs of the Board and its respective committees and the qualifications of candidates in light of these needs. The Nominating Committee believes that it is important to maintain and consistently refresh a list of qualified potential candidates for nomination.

The Nominating Committee will evaluate and recommend candidates for membership on the Board consistent with criteria established by the committee. In identifying prospective director candidates, the Nominating Committee may consider all facts and circumstances that it deems appropriate or advisable, including, among other things, the skills of the prospective director candidate, their independence, their depth and breadth of business experience, the needs of the Board and the diversity of viewpoints, background, experience and other characteristics, such as geographic background, nationality, culture, gender, sexual orientation, ethnicity, race, and age, that a candidate would bring (including in light of applicable diversity requirements regarding gender, underrepresented communities or otherwise). While the Nominating Committee does not have a formal policy with respect to diversity; the Board is committed to actively seeking highly qualified women and individuals from minority groups to include in the pool from which director nominees are selected.

At a minimum, the Nominating Committee must be satisfied that each Nominating Committee-recommended nominee meets the following minimum qualifications:

The Nominating Committee will also seek appropriate input from our CEO from time to time in assessing the needs of the Board for relevant background, experience, diversity, and skills of its members.

Annually, our Board works with an outside advisor to conduct a comprehensive evaluation of our Board, its committees and its individual members. The Nominating Committee oversees this evaluation process. The evaluation aims (i) to find opportunities where our Board and committees can improve their performance and effectiveness, (ii) to assess any need to evolve the composition and expertise of our Board, and (iii) to assess the quality and effectiveness of the interactions between our Board and Atlassian management. The collection of information is facilitated by an outside advisor to preserve integrity and anonymity of the members of our Board.

The Nominating Committee is responsible for designing the evaluation process and establishing the evaluation criteria. During the evaluation process, the outside advisor collects feedback from each director, and then the results of the evaluation and any recommendations for improvement are provided to our Board. Our Board reviews and discusses the evaluation results and any actions to be taken as a result of the discussion. Our Board, including our Nominating Committee, uses the results to inform Board and committee composition, including considering the backgrounds, skills and experience that can best prepare our Board for the evolving needs of Atlassian.

The Nominating Committee considers properly submitted recommendations for candidates to the Board from stockholders. In evaluating such recommendations, the Nominating Committee evaluates candidates recommended by stockholders using the same criteria it applies to evaluate other candidates and seeks to achieve a balance of experience, diversity, knowledge, integrity, and capability on the Board and to address the membership criteria set forth under “Identification, Criteria and Evaluation of Director Nominees” above.

Stockholder recommendations to the Board should be sent to the attention of Atlassian’s Corporate Secretary by one of the following two ways:

The full Board oversees Atlassian’s risk management program and delegates certain risk oversight responsibilities to Board committees. Management is responsible for balancing risk and opportunity in support of Atlassian’s objectives, and carries out the daily processes, controls and practices of our risk management program — many of which are embedded in our operations. Atlassian’s enterprise risk management program is designed to identify, assess and prioritize Atlassian’s risk exposures across various time frames, from the short-term to the long-term. Risks are evaluated based on their potential magnitude, likelihood and immediacy. The committees of the Board play key roles in the Board’s risk oversight responsibility. All committees receive regular reports from Atlassian officers responsible for monitoring and mitigating particular risk exposures, and the committee chairs provide regular reports to the full Board on relevant areas of oversight, as summarized below.

The Board and Nominating Committee regularly review and evaluate Atlassian’s corporate governance practices. The Board has adopted corporate governance principles that address the composition of, and policies applicable to, the Board, as well as a Code of Business Conduct and Ethics applicable to all directors, officers and employees of Atlassian, including our CEO and Chief Financial Officer.

We proactively engage with our stockholders throughout the year on a wide range of topics that are of interest and priority to both Atlassian and our stockholders. These topics include business strategy, company performance, compensation programs, risk, culture, and environmental, social and governance issues. Our engagement process enables us to better understand our stockholders' priorities, thoughtfully consider a diversity of perspectives, provides us an opportunity to elaborate on our initiatives, and fosters open and constructive dialogue.

Our Investor Relations team regularly meets with investors, prospective investors, and investment analysts and is responsible for leading our stockholder outreach. Meetings can include participation by our senior management team, as well as members of the Board, as appropriate. Our head of Investor Relations regularly communicates topics discussed and stockholder feedback to senior management and the Board for consideration in their decision-making. During fiscal year 2024, we held discussions with many of our largest stockholders during scheduled events, such as our first-ever ESG Forum in November 2023 and our Investor Day in May 2024, as well as in regularly held meetings throughout the year.

Stockholders are able to communicate with the Board and with individual directors in their capacity as a member of the Board, by email or in writing as follows:

All communications from stockholders must be accompanied by the following information regarding the person submitting the communication: (i) a statement of the type and amount of the securities of Atlassian that such stockholder holds, and a representation that the stockholder is a record holder of Atlassian’s securities, or if the stockholder is not a record holder, evidence of ownership in accordance with Rule 14a-8(b)(2) of the Exchange Act, and (ii) the address, telephone number and e-mail address, if any, of such person.

Atlassian’s sustainability strategy is focused on our impact across our planet, people and customers. The Board oversees Atlassian’s sustainability program. The Sustainability team focuses on implementation of the strategy and disclosure of progress towards Atlassian’s sustainability commitments. While we’ve included some highlights below, we encourage you to get the full picture by reading our latest Sustainability Report on the “Corporate Social Responsibility” portion of our website, under the “About Us” section. The Sustainability Report aligns to leading reporting frameworks, including the Greenhouse Gas (“GHG”) Protocol and the Sustainability Accounting Standards Board (“SASB”). The contents of these materials, and the contents of those materials accessible through our website, are not incorporated into this filing.

Atlassian set science-based targets to achieve net zero by 2040, with near-term emissions reduction goals set for fiscal year 2025 covering operational emissions, suppliers, and business travel. We have run our operations on 100% renewable electricity since fiscal year 2020 by purchasing energy attribute certificates to cover 100% of office electricity use. As we evolved to support sustained distributed working arrangements through our Team Anywhere program, we went a step further to include work-from-home electricity and gas use. In fiscal year 2024, our first U.S. fixed-price Virtual Power Purchase Agreement (“VPPA”) came online to deliver renewables and match our U.S. office and work-from-home energy use. To reduce the impact of business travel on the environment, we updated our travel policy to allow direct flights and joined the Sustainable Aviation Buyer Alliance as we explore Sustainable Aviation Fuels. We also updated the “Don’t F&%k the Planet” guide with more details on our emissions offset strategy, so other companies can learn from our journey. We’ve gained traction in engaging suppliers to set their own science-based targets by providing free advisory services and landing our first supplier climate agreement that included a supplier commitment to set their own climate goals. We also conducted a climate-risk screening and scenario analysis aligned to recommendations by the Task Force on Climate-Related Financial Disclosures (“TCFD”).

Read more about our climate action strategy, including our science-based targets, interim progress, methodologies and third-party verification of GHG emissions in our latest Sustainability Report on the “Corporate Social Responsibility” portion of our website, under the “About Us” section. The contents of these materials, and the contents of those materials accessible through our website, are not incorporated into this filing.

Atlassian has set long-term hiring rate goals to help us focus on increasing the diversity of candidates in our applicant pool. These are not quotas or targets, but high-level goals co-owned by the People team and Atlassian leaders to move us in the right direction at a pace we could be proud of. To meet these goals, we’ve expanded our strategic partnerships with organizations that support underrepresented groups in the tech industry and supported hiring teams with equity and inclusion guidance. Atlassian’s diversity, equity, and inclusion strategy goes beyond building a diverse Atlassian team to promote equitable outcomes and foster inclusive experiences for all. In fiscal year 2024, participation in Atlassian’s Employee Resource Groups (“ERGs”) increased over 60% percent year-over-year, and we continue to compensate ERG leaders for their hard work on top of their full time roles. We’ve also focused on defining and creating a candidate accommodations process for those who need accommodations. We continue to incorporate anti-biasing principles and techniques across People programs, including by working to automate bias mitigation flags and nudges in performance tools, and by providing enablement materials to support equitable use of the built-in AI in our new company-wide applicant tracking system.

Atlassian is committed to respecting human rights. We have aligned to the UN Guiding Principles on Business and Human Rights in a public Human Rights Statement. We annually seek to identify and manage salient human rights risks with teams across the business. Alongside the launch of Atlassian Intelligence last year, we shared our Responsible Technology Principles, which outline five tenets that guide how we uphold Atlassian’s Values when it comes to building, deploying and using new technologies. We also developed and publicly shared a Responsible Technology Review Template and accompanying “No BS Guide” to advance the conversation on responsible product development and deployment. To read our Human Rights Statement, visit the “Corporate Social Responsibility” portion of our website, under the “About Us” section. To read our Responsible Technology Principles, visit the “Trust” portion of our website, under the “About Us” section. The contents of these materials, or the contents of those materials accessible through our website, are not incorporated into this filing.

Our company culture is exemplified by our core values:

The following are the key elements of our corporate culture that contribute to our ability to drive customer value and achieve competitive differentiation:

In Atlassian’s early days, our Co-Founders built giving back into our business with the creation of the Atlassian Foundation.

Atlassian contributes 1% of its equity, profit, employee time, and products to the Atlassian Foundation to do good on a global scale and in our own backyards.

One of Atlassian’s values is “Be the change you seek,” and the opportunities the Atlassian Foundation provides are a great way for employees to live this value.

Below are our areas of focus:

We call our approach to distributed work “Team Anywhere.” The vast majority of our employees are offered the choice to work from their homes, our physical office locations, or any combination of the two, within 14 countries. We believe our Team Anywhere approach allows for a variety benefits, including greater flexibility for our employees and broadening our talent pool beyond the urban hubs in which we have physical office locations.

The Audit Committee is responsible for reviewing, and approving or ratifying, as appropriate, transactions between Atlassian (or one of our subsidiaries) and any “related person” of Atlassian. Under SEC rules, “related persons” include directors, officers, nominees for director, 5% or greater stockholders, and their immediate family members. The Audit Committee has adopted a written policy to evaluate these transactions for approval or ratification. Under this policy, the Audit Committee will review the relevant facts and circumstances of all related person transactions and either approve, ratify or disapprove of the entry into the transaction. In determining whether to approve or ratify any such transaction, the Audit Committee will take into account, among other factors it deems appropriate, whether the transaction (i) is on terms no less favorable than terms generally available to an unaffiliated third party, (ii) is consistent with the interests of Atlassian and its stockholders, and (iii) arose in the ordinary course of business. The policy grants standing pre-approval of certain transactions, including, among other things, (i) certain compensation arrangements involving directors and executive officers that are required to be reported in our Annual Report on Form 10-K or proxy statement and, with respect to executive officer compensation, satisfy other criteria, including having been approved by the CLDC, (ii) certain transactions where the relationship between us and the related person arises only from the related person’s position as a director of, and/or having holdings of less than 10% of, such entity, and (iii) transactions where a related person’s interest arises solely from the ownership of our stock and all holders of our stock received the same benefit on a pro rata basis.

Other than as set forth below, since the beginning of fiscal year 2024, there have not been any transactions, nor are there any currently proposed transactions, in which Atlassian was or is to be a participant, where the amount involved exceeded $120,000 and in which any related person had or will have a direct or indirect material interest. As is the case with most multinational corporations, from time to time in the ordinary course of business, we engage in arms-length transactions with companies in which members of our Board or our executive team have professional relationships.

In July 2010, our predecessor entity, Atlassian Corporation Pty Ltd., entered into a Registration Agreement with certain holders of our outstanding share capital, including Messrs. Cannon-Brookes and Farquhar, pursuant to which such holders were entitled to rights with respect to the registration of their shares under the Securities Act. This Registration Agreement was terminated on February 27, 2024.

Our non-employee director compensation policy (as amended and restated from time to time, the “Non-Employee Director Compensation Policy”) is designed to attract, retain, and award directors of Atlassian who are not employees or officers of Atlassian and align their long-term interests with those of Atlassian and our stockholders. Employee directors receive no additional compensation for their service as a director.

Decisions regarding the Non-Employee Director Compensation Policy are approved by our CLDC. The CLDC conducts an evaluation of the design and competitiveness of our Non-Employee Director Compensation Policy on an annual basis in conjunction with Semler Brossy, the CLDC’s independent compensation consultant. The annual review includes an assessment of competitive market practices for pay levels, pay design, and other market trends using the same peer group used for executive pay. We aim to position non-employee director compensation competitively against the peer group that is used for executive pay assessment. Following the 2024 annual review, we amended our Non-Employee Director Compensation Policy, as outlined below, to remain competitive and align with our intended pay philosophy. We plan to continue to review non-employee director compensation levels annually and make adjustments as necessary.

Our Non-Employee Director Compensation Policy consists of an annual cash retainer for service on the Board, additional retainers for serving as the chair of each of our standing Board committees, an additional cash retainer for the non-employee Board Chair, and an annual equity retainer awarded in the form of restricted stock units (“RSUs”).

We reimburse non-employee directors for all reasonable expenses incurred in connection with their service on the Board, including attending Board and committee meetings. However, we do not pay meeting attendance fees.

The table below outlines the details of our Non-Employee Director Compensation Policy in effect for fiscal year 2024:

On the date of each annual meeting of stockholders, each non-employee director who continues as a member of our Board following such annual meeting of stockholders will receive a grant of RSUs (the “Annual Award”). In fiscal year 2024, the Annual Award had a value of $265,000, rounded up to the nearest whole share. Commencing July 1, 2024, the Annual Award has a value of $290,000 rounded up to the nearest whole share. The Annual Award vests in full on the earlier of: (i) the one-year anniversary of the grant date; and (ii) the next annual meeting of stockholders, subject to continued service as a director through the applicable vesting date, unless the CLDC determines that circumstances warrant continuation of vesting.

We believe it is important for our non-employee directors to own a meaningful amount of Atlassian stock to create alignment between the interests of our non-employee directors and our stockholders. As such, we maintain a stock ownership policy for our non-employee directors which requires each non-employee director to own a specific value of our stock while they serve on our Board. The policy requires each non-employee director to hold Atlassian stock with a fair market value of at least $265,000. Non-employee directors have four years from their initial appointment to the Board to meet this minimum requirement. Semler Brossy, the CLDC’s independent compensation consultant, has reviewed our stock ownership policy and found it to be competitive with those of our peer companies.

Set forth below are the names and certain information about our executive officers, except Mr. Cannon-Brookes, whose biographical information can be found under “Directors and Corporate Governance—Biographies.”

The Compensation Discussion and Analysis describes the compensation programs for our named executive officers (our “NEOs”). For the fiscal year ended June 30, 2024 these individuals were:

We announced two NEO departures since the beginning of fiscal year 2024:

We are guided by our mission of unleashing the potential of every team. We view a talented executive team at the center of enabling the long-term success of Atlassian’s mission. Our current executive compensation programs and philosophy are designed to attract, motivate, and retain top executive talent within a highly competitive technology labor market.

The Compensation and Leadership Development Committee (the “CLDC”) reviews the efficacy of our programs annually, taking into consideration our executive compensation philosophy, business performance, stockholder interests, our peer group of companies, and company objectives. Our current executive compensation programs reflect the enhancements made over multiple years by the CLDC to ensure strong alignment with our long-term business strategy.

Our products serve teams of all shapes and sizes in every industry. Our competitors range from large technology vendors to new and emerging businesses in each of the markets we serve:

As a result, our compensation programs are designed to reflect the realities of operating in competitive technology markets that are as varied as our product market landscapes and ensure that we are able to attract and retain critical talent to support our continued growth and success across all aspects of our business.

Specifically, we note the following points of context that impact our pay philosophy and objectives:

As part of our U.S. redomiciliation, we publicly reported our NEO compensation for the first time in our 2023 Compensation Discussion and Analysis and held our inaugural annual stockholder advisory vote on executive compensation. At our 2023 Annual Meeting, 97.5% of the votes cast were in favor of our advisory vote on executive compensation (“Say-on-Pay” vote), which indicated broad support for our executive compensation program and philosophy. Additionally, 99.8% of the votes cast were in favor of the proposal for a one-year Say-on-Pay frequency vote.

Following the results of our Say-on-Pay vote, we engaged with stockholders and evaluated feedback from proxy advisors to understand the factors that led to lower support for our advisory vote on executive compensation compared to our Say-on-Pay frequency vote (97.5% vs. 99.8%).

Our executive compensation philosophy is based on the understanding that for us to be successful, we must attract, motivate, reward, and retain high-caliber talent. We also recognize the need to create a strong pay-for-performance connection through our compensation programs and establish a long-term ownership mentality. As such, our programs are focused on providing our executives the opportunity to earn competitive pay levels, with the ability to exceed these levels with strong company and individual performance. Further, we deliver the vast majority of each non-CEO executive’s compensation in the form of equity, which features a multi-year vesting period, and we prioritize ensuring our executives have a meaningful equity stake in Atlassian to further align their long-term wealth creation with that of our stockholders. Our philosophy adheres to the following guiding principles:

The CLDC believes that its executive compensation and benefits philosophy and objectives have resulted in programs that align our executives’ interests with our stockholders’ interests.

The CLDC, in consultation with Semler Brossy, its independent compensation consultant, conducts an executive compensation market assessment each year that relies on publicly available data for a group of peer companies and available third-party compensation surveys. This process ensures that our Board and the CLDC have current information when calibrating compensation levels for our executive officers. Beyond the competitive market assessment, the CLDC also reviews talent profiles for each executive officer and considers comparisons against internal peers.

The CLDC oversees our executive compensation programs, including executive salaries, payouts under our annual incentive plan, the size and structure of equity awards, and any executive perquisites. The CLDC receives assistance from two sources: (1) an independent compensation consulting firm, Semler Brossy, and (2) our internal executive compensation staff, led by our Chief Administrative and Legal Officer. All decisions regarding executive compensation are made solely by the CLDC.

The CLDC has the authority to engage its own advisors to assist in carrying out its responsibilities. In fiscal year 2024, the CLDC engaged Semler Brossy to provide guidance regarding the amount and types of compensation that we provide to our executives, how our compensation practices compare to the compensation practices of other companies, including with respect to a peer group of companies developed in consultation with Semler Brossy, governance policy best practices, and other compensation-related matters. Semler Brossy reports directly to the CLDC and its chair and serves at the discretion of the CLDC which reviews the engagement annually. Semler Brossy may meet with members of management for the purposes of gathering information on proposals that management may make to the Board or the CLDC. Semler Brossy does not provide any services to Atlassian other than the services relating to executive and director compensation.

Semler Brossy maintains a policy that is specifically designed to prevent any conflicts of interest. In addition, the CLDC has assessed the independence of Semler Brossy taking into account, among other things, the factors set forth in Rule 10C-1 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) and the listing standards of Nasdaq and concluded that no conflict of interest exists with respect to the work that Semler Brossy performs for the CLDC.

In setting compensation for fiscal year 2024, our CEO, former Co-CEO, and Chief Administrative and Legal Officer worked closely with the Board in managing our executive compensation programs and attended CLDC meetings to discuss these topics. Our CEO and former Co-CEO made recommendations to the CLDC regarding compensation for our executive officers (other than themselves) because of their daily involvement with our executive team. No executive officer participated directly in the final deliberations or determinations regarding their own compensation package.

For fiscal year 2024, the CLDC assessed the competitiveness of each element of each executive officer’s total target direct compensation against our executive pay peer group. The CLDC does not use a single method or measure in developing its recommendations, nor does it establish one specific target for the compensation opportunities of our executive officers.

The CLDC reviewed and compared our executive compensation to that of executives in similar positions in our peer group. In assessing the peer group, the CLDC first looked at industry and growth and scale fits:

We further narrowed down the list of potential companies by examining the following factors:

After considering the above factors, the CLDC approved the following peer group for fiscal year 2024 compensation decisions:

We removed three companies (Coupa Software, Inc., Twitter, Inc. and Zendesk, Inc.) due to M&A activity and added two companies (Datadog, Inc. and Snowflake, Inc.) with similar size and scale to Atlassian. Against the fiscal year 2024 peer group, we were positioned at the 37th percentile on trailing twelve-month revenues, 45th percentile on historical three-year compounded annual revenue growth, 49th percentile on market value, and 57th percentile on the total number of employees. The CLDC considered the peer group to be an accurate representation of the talent and business markets, with a relatively balanced stance across various factors (i.e., bigger in some metrics and smaller in others).

Our executive compensation programs are heavily tied to performance-based pay. Excluding pay for our CEO and former Co-CEO, over 90% of our NEOs’ target total pay is linked to performance as illustrated in the chart below:

For fiscal year 2024, the primary elements of our NEOs’ compensation were:

Our base salary program strives for simplicity, embraces transparency and consistency, and delivers competitive compensation to each of our NEOs to reflect their respective positions, duties, and responsibilities.

The CLDC reviews the base salaries of our executive officers annually and may adjust them to reflect market conditions or other factors. The base salaries listed below were established in reference to our peer group with input from the CEO and former Co-CEO and were reviewed and approved by the CLDC.

As noted above, we strive for simplicity and equity within our compensation programs, and we strongly encourage our executives to embrace a long-term performance mentality. As a result, we’ve standardized base salaries across our top executive officers and have shifted focus from short-term fixed compensation to long-term variable pay. Because of our focus on internal equity, our executive officers receive base salary amounts within a narrow range. We will continue to review base salaries in the context of our peer group, and when appropriate, may adjust the base salary for all applicable executive officers in order to maintain internal equity.

As previously noted, our CEO and former Co-CEO primarily received a salary of AUD $74,653 (or USD $49,052 for fiscal year 2024).

Our annual cash incentive program reinforces our pay-for-performance orientation by focusing our NEOs’ attention on performance of our key business priorities and embraces a simple, clear, and transparent decision-making process.

Our annual cash incentive program is 100% formulaic and measures performance on cloud and Marketplace cloud revenue. For purposes of our annual cash incentive program, cloud and Marketplace cloud revenue is equal to cloud revenue as reported in the audited financial statements, plus fees received for sales of third-party cloud apps in the Atlassian Marketplace, which is a component of other revenue as reported in the audited financial statements. Cloud revenue, including the related revenue from sales of third-party cloud apps in the Atlassian Marketplace, remains a critical strategic priority for us to support our customers and seamlessly connect them to a diverse set of products that will enhance their workflow capabilities. We believe that success on cloud revenue is crucial to Atlassian’s ability to scale and continue leading in our industry.

Messrs. Cannon-Brookes and Farquhar do not participate in the annual cash incentive program due to their sizable equity stakes in Atlassian, which we and they feel appropriately aligns their personal financial interests with company performance.

Each NEO (excluding Messrs. Cannon-Brookes and Farquhar) is eligible to receive an annual cash incentive award based on a specified target annual cash incentive award amount, expressed as a percentage of the NEO’s base salary. The potential payout will range from 0% up to 200% of an individual NEO’s target opportunity based on performance against predetermined financial goals. In fiscal year 2024, our NEOs participated in our annual cash incentive program at 60% target percentages of their base salary.

The mechanics of the annual cash incentive program are as follows:

The annual cash incentive payout structure is aligned with our top company priority of driving cloud revenue growth and ensures we are incentivizing what we believe is the right outcome. The CLDC references our internal plan when setting targets for the annual cloud and Marketplace cloud revenue metric. The target is intended to be challenging but achievable, while threshold performance is intended to be reasonably achievable, and the maximum represents a stretch goal. The CLDC reviews the appropriateness of threshold, target, and maximum goals annually, with a focus on attempting to ensure that our performance goals will result in stockholder value creation in the long term. The fiscal year 2024 cloud and Marketplace cloud revenue threshold, target, and maximum goals (as well as actual fiscal year 2024 achievement) are shown below ($ in millions):

During fiscal year 2024, we achieved cloud and Marketplace cloud revenue of $2,778 million, which corresponds to 97.8% of the fiscal year 2024 target. This performance translated into cash incentive payouts equal to 95.6% of each executive’s targeted amount based on a 2.0x leveraged payout curve between 95% and 105% cloud and Marketplace cloud revenue attainment (i.e., 2% change in payout for each 1% change in attainment), as shown below.

We view long-term equity incentive compensation as a critical component of our balanced total compensation programs. Our equity compensation program design is competitive, simple, and fosters an ownership mentality and a pay-for-performance orientation.

Our CEO and former Co-CEO did not participate in our long-term equity incentive compensation program in fiscal year 2024 due to their sizable equity stakes in Atlassian, which we and they feel appropriately align their personal financial interests with our performance.

For our fiscal year 2024 on-going equity awards, we granted 100% time-based RSUs to our NEOs who received grants. Ms. Bharadwaj received no new equity awards in fiscal year 2024. As stated in our previous Compensation Discussion and Analysis, in February 2023, as part of Atlassian’s organizational rebalancing, Ms. Bharadwaj was promoted to President. To recognize Ms. Bharadwaj’s expanded role, in April 2023, the CLDC granted Ms. Bharadwaj additional RSUs with an initial grant value of $14 million. The award vests in equal quarterly installments over four years. The CLDC determined this equity award included both a role expansion component as well as the equivalent of Ms. Bharadwaj’s fiscal year 2024 annual equity award, which typically would be granted in September 2023 (i.e., Ms. Bharadwaj will not be eligible to receive her next annual equity award until the beginning of fiscal year 2025).

The CLDC believes that RSUs serve as an effective retention tool for our high-performing executive officers and focus executive officers on completing long-term objectives, which will result in increased stockholder value creation over time. Our RSUs vest quarterly over a four-year vesting period, subject to continued service.

To determine the size of the annual equity awards for our NEOs, the CLDC reviewed data provided by Semler Brossy, which estimated the range of competitive grant values among our peer companies. From that data set, individual equity award targets were established that would position our executives competitively against their market reference.

Awarded equity values also took into consideration each executive’s performance, impact, the scope of their roles, and unvested equity values at the time of grant. The CLDC also considered Mr. Binz’s relatively short tenure in his role as CFO when sizing his first annual equity award in fiscal year 2024.

Each September we use our performance management assessment framework and resulting individual assessments from the most recent fiscal year to inform the equity award amounts. The fiscal year 2024 awards granted in September 2023 were based on our performance assessment outcomes from fiscal year 2023.

Our performance management assessment framework follows a robust process to assess each individual against performance and development objectives. All performance assessments and long-term incentive outcomes were reviewed by the CLDC in consultation with our CEO and former Co-CEO. This approach further reinforced the link between performance and pay, while continuing to deliver compensation that is tied to long-term stockholder value.

In September 2023, we granted the following annual equity awards (with four-year ratable quarterly vesting) to our NEOs:

Our executive officers are eligible to participate in all of our employee benefit plans, including our medical, dental, life, and disability insurance plans, to the same extent as other employees generally in the jurisdiction each executive officer resides. For Messrs. Cannon-Brookes and Farquhar, as required by Australian law, we pay statutorily required amounts into an Australian “superannuation” retirement fund on their behalf.

We maintain a 401(k) Plan that provides all regular U.S. employees, including U.S. executive officers, with an opportunity to save for retirement on a tax-advantaged basis. Under our 401(k) Plan, participants may elect to defer a portion of their eligible compensation on a pre-tax, Roth after-tax, and voluntary after-tax basis and have it contributed to the 401(k) Plan subject to applicable annual limits set forth in the Internal Revenue Code of 1986, as amended (the “Code”). The 401(k) Plan allows for matching contributions to be made by us. Currently, we make a safe harbor match based on the participant's pre-tax and Roth after-tax contributions up to a maximum of four percent of the participant's base salary, bonus, and commissions paid during the applicable contribution period, subject to statutory limits. Employee elective deferrals and safe harbor matching contributions are 100% vested at all times.

Our NEOs, excluding Messrs. Cannon-Brookes and Farquhar, participate in the Atlassian Corporation Amended and Restated Executive Severance Plan (the “Executive Severance Plan”). The Executive Severance Plan provides for our NEOs to receive a severance payment equal to nine months of base salary upon a termination of their employment by us without "cause" (as defined in the Executive Severance Plan) or a resignation by the executive officer for "good reason" (as defined in the Executive Severance Plan) or, if the termination or resignation occurs within 3 months prior to or 12 months following a "change in control" (as defined in the Executive Severance Plan), a severance payment equal to twelve months of base salary, plus 100% of the covered executive’s annual target bonus in effect immediately prior to the “date of termination” (as defined in the Executive Severance Plan). In addition, upon such a qualifying termination of employment within 3 months prior to or 12 months following a "change in control" in which outstanding equity awards of Atlassian will be assumed, continued, or substituted by the successor entity, an executive officer will generally receive 100% (or such lower percentage as may be determined by our Board or the CLDC) accelerated vesting of all unvested and outstanding equity awards held by such executive officer at such time; provided, that any equity awards subject to performance conditions will be deemed satisfied at the target levels specified in the applicable award agreements. Notwithstanding the foregoing, if the outstanding equity awards of Atlassian will not be assumed, continued or substituted by the successor entity in connection with the change in control, then each executive officer will receive accelerated vesting of all unvested and outstanding equity awards held by such executive officer at such time; provided, that any equity awards subject to performance conditions will be deemed satisfied at the target levels specified in the applicable award agreements.

Information on the estimated payments and benefits that our NEOs would have been eligible to receive as of June 30, 2024, is set forth in the subsection titled “Potential Payments Upon Termination or Change in Control” below.

No executive officers, members of the Board, employees, consultants or independent contractors may directly or indirectly engage in transactions intended to hedge or offset any change in value of Atlassian stock owned by them, including pledging of Atlassian stock as collateral for a loan, unless approved by the Audit Committee. If a transaction is permitted, the executive officer remains subject to all other restrictions related to Atlassian’s Insider Trading and Disclosure Policy and Stock Ownership Policy (each as defined below).

Atlassian adopted an insider trading and disclosure policy, effective December 10, 2015 (the “Insider Trading and Disclosure Policy”), that governs the purchase, sale, and other disposition of our securities by our employees, directors, officers, consultants, and contractors (“Covered Persons”). We believe our Insider Trading and Disclosure Policy is reasonably designed to promote compliance with insider trading laws, rules, and regulations as well as the exchange listing standards applicable to us. Our Insider Trading and Disclosure Policy prohibits our employees, directors, officers, consultants, and contractors from trading in our securities while in possession of material non-public information, among other things.

Under the terms of our Insider Trading and Disclosure Policy, Covered Persons are permitted to adopt written stock plans (“Rule 10b5-1 Plans”), under which they contract with a broker to execute trades of common shares pursuant to parameters established when the plan was entered into, provided that any such plan be in accordance with guidelines of Rule 10b5-1 of the Exchange Act. Several of our directors and senior executives have established Rule 10b5-1 Plans, and additional directors and senior executives may choose to do so in the future.

The foregoing summary of our Insider Trading and Disclosure Policy does not purport to be complete and is qualified by reference to our Insider Trading and Disclosure Policy, which can be found as an exhibit to our Annual Report on Form 10-K for the fiscal year ended June 30, 2024.

Atlassian adopted an equity ownership requirements policy, effective July 1, 2023, that is applicable to all senior executives including our NEOs (the “Stock Ownership Policy”). The Stock Ownership Policy was designed to closely align the interests of our executives with those of our stockholders. Executives must retain 20% of shares remaining at the time of the vesting of RSUs, after payment of any applicable tax withholding, for a period of seven years from each vesting event. The Stock Ownership Policy does not enforce a lot-by-lot requirement on shares vested, so executives can satisfy the requirements by holding the equivalent number of shares from unrelated vesting events. All equity awards are included under the scope of this policy, except for new-hire awards. All NEOs subject to the policy met the stock ownership guidelines and holding requirements as of June 30, 2024.

The Stock Ownership Policy also includes a post-termination ownership requirement. In the event of employment termination, 50% of the shares subject to the holding requirements will be released after one year, and the remaining 50% of the shares subject to the holding requirements will be released on the second anniversary of termination.

Atlassian adopted a Compensation Recovery Policy (the “Clawback Policy”) that meets the requirements of SEC and Nasdaq rules prior to the effectiveness of the rules in December 2023. The Clawback Policy applies to our Section 16 officers and requires the return of any erroneously awarded “Incentive Compensation” (as defined in the Clawback Policy) that was received during the three completed fiscal years preceding the date that the Board or a committee of the Board concludes, or reasonably should have concluded, that Atlassian is required to restate its financial statements, or if earlier, the date on which a court, regulator or other legally authorized body directs Atlassian to make such a restatement. Atlassian will seek to recover any additional amount of compensation actually paid over the amount that would have been paid following recalculation based on the restated financial statements.

As a general matter, the CLDC reviews and considers the various tax and accounting implications of the compensation programs we utilize.

Section 409A of the Code imposes additional significant taxes in the event that an executive officer, director or service provider receives “deferred compensation” that does not satisfy the requirements of Section 409A of the Code. Although we do not maintain a traditional non-qualified deferred compensation plan for our executive officers, Section 409A of the Code does apply to certain severance arrangements, bonus arrangements and equity awards, and we have structured all such arrangements and awards in a manner to either avoid or comply with the applicable requirements of Section 409A of the Code.

We follow ASC Topic 718 for our stock-based compensation awards. ASC Topic 718 requires companies to measure the compensation expense for all stock-based awards made to employees and directors, including stock options and RSUs, based on the grant-date fair value of these awards. This calculation is performed for accounting purposes and reported in the compensation tables below, even though our executive officers may never realize the value reported from their awards.

We conduct an annual review of our compensation programs to assess whether our policies, program designs, or practices create any material adverse effect on Atlassian. The results of this analysis concluded that our compensation practices do not create incentives to take risks that are reasonably likely to have a material adverse effect on Atlassian. The assessment and our findings were reviewed by Semler Brossy, the independent consultant of the CLDC, and discussed with the CLDC.

The CLDC has reviewed and discussed the Compensation Discussion and Analysis with management. Based on its review and discussions with management, the CLDC recommended to our Board that the Compensation Discussion and Analysis be included in our Annual Report on Form 10-K for the fiscal year ended on June 30, 2024.

The following table sets forth information regarding the compensation paid to, or earned by our NEOs for the fiscal years ended June 30, 2023 and June 30, 2024. Positions listed below are those held by the named executive officers as of June 30, 2024.

The following table provides information on the equity grants awarded to our NEOs in fiscal year 2024 and estimated payouts under our non-equity incentive plan.