THE EST{E LAUDER COMPANIES INC.€¦ · THE ESTEE LAUDER COMPANIES INC.´ 767 Fifth Avenue New...

William P. LauderExecutive Chairman

September 24, 2020

Dear Fellow Stockholder:

You are cordially invited to attend the 2020 Annual Meeting of Stockholders. It will beheld on Tuesday, November 10, 2020, at 10:00 a.m., Eastern Time, where we will ask you tovote on the items set forth in the Notice of Annual Meeting of Stockholders below. Due toCOVID-19, we are holding the Annual Meeting in a virtual-only meeting format.

Please vote your shares using the Internet or telephone, or by requesting a printedcopy of the proxy materials and completing and returning by mail the proxy card youreceive in response to your request. Instructions on each of these voting methods areoutlined in this Proxy Statement. Please vote as soon as possible.

Thank you for your continued support.

YOUR VOTE IS IMPORTANT. PLEASE PROMPTLY SUBMIT YOUR PROXYBY INTERNET, TELEPHONE, OR MAIL.

Notice of 2020 Annual Meeting of Stockholdersand Proxy Statement

The Estée Lauder Companies Inc.767 Fifth AvenueNew York, New York 10153

The Global House of Prestige BeautyTHE EST{E LAUDER COMPANIES INC.

17SEP201414335317

THE ESTÉE LAUDER COMPANIES INC.767 Fifth AvenueNew York, New York 10153

Date: Tuesday, November 10, 2020Time: 10:00 a.m., Eastern TimeMeeting Format:

Due to COVID-19, we are holding the 2020 Annual Meeting in a virtual-only meeting format vialive webcast on the Internet. You will not be able to attend at a physical location. Stockholders willbe able to join and attend online by logging in at www.virtualshareholdermeeting.com/EL2020.

Additional information is provided below, including under the heading ‘‘How can I attend thevirtual-only Annual Meeting?’’.

1. To elect the five Class III Director Nominees as Directors to serve until the 2023 AnnualMeeting of Stockholders;

2. To ratify the Audit Committee’s appointment of PricewaterhouseCoopers LLP asindependent auditors for the 2021 fiscal year; and

3. To provide an advisory vote to approve executive compensation.

We also will transact such other business as may properly come before the meeting and anyadjournments or postponements of the meeting.

By Order of the Board of Directors

SPENCER G. SMULSenior Vice President,Deputy General Counsel and Secretary

New York, New YorkSeptember 24, 2020

THE BOARD OF DIRECTORS URGES YOU TO VOTE BY INTERNET OR BY TELEPHONE OR BYREQUESTING A PRINTED COPY OF THE PROXY MATERIALS AND COMPLETING AND RETURNING BYMAIL THE PROXY CARD YOU RECEIVE IN RESPONSE TO YOUR REQUEST.

IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS FOR THE 2020ANNUAL MEETING OF STOCKHOLDERS TO BE HELD ON NOVEMBER 10, 2020: The Company’s ProxyStatement for the 2020 Annual Meeting of Stockholders and the Annual Report on Form 10-K forthe fiscal year ended June 30, 2020 with certain exhibits (which constitutes the ‘‘Annual Report toStockholders’’) are available at www.proxyvote.com.

Notice of Annual Meeting of Stockholders

ITEMS OF BUSINESS:

Proxy Statement Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1Information about the Annual Meeting and Voting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10Board of Directors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10

Director Qualifications . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10NOMINEES FOR ELECTION TO TERM EXPIRING 2023 (CLASS III) . . . . . . . . . . . . . . . . . . . 11INCUMBENT DIRECTORS – TERM EXPIRING 2021 (CLASS I) . . . . . . . . . . . . . . . . . . . . . . . 13INCUMBENT DIRECTORS – TERM EXPIRING 2022 (CLASS II) . . . . . . . . . . . . . . . . . . . . . . . 16

Additional Information Regarding the Board of Directors . . . . . . . . . . . . . . . . . . . . . . . . . 19Stockholders’ Agreement and Lauder Family Control . . . . . . . . . . . . . . . . . . . . . . . . . . . 19Board Committees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19Compensation Committee Interlocks and Insider Participation . . . . . . . . . . . . . . . . . . . . 21Board and Board Committee Meetings; Annual Meeting Attendance; and Executive

Sessions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21Board Leadership Structure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21CEO Succession Planning Process . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22Board Role in Risk Oversight . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22Risk in Compensation Programs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22Board Membership Criteria . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22Board Independence Standards for Directors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23Communications with the Board . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24Director Nominees Recommended by Stockholders . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24

Corporate Governance Guidelines and Code of Conduct . . . . . . . . . . . . . . . . . . . . . . . . . . 25Related Person Transactions Policy and Procedures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25Certain Relationships and Related Transactions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25Director Compensation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31Ownership of Shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36Executive Compensation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42

Compensation Discussion and Analysis . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42Compensation Committee and Stock Plan Subcommittee Report . . . . . . . . . . . . . . . . . . 69Summary Compensation Table . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 70Employment Agreements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 73Grants of Plan-Based Awards in Fiscal 2020 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 75Outstanding Equity Awards at June 30, 2020 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 77Option Exercises and Stock Vested in Fiscal 2020 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 79Pension Benefits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 80Nonqualified Deferred Compensation in Fiscal 2020 and at June 30, 2020 . . . . . . . . . . . 81Potential Payments upon Termination of Employment or Change of Control . . . . . . . . . 81Pay Ratio Disclosure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 89

Audit Committee Report . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 90. . . . . . . . . . . . . . . 91

. . . . . . . . . . . . . . . . . 93Proxy Procedure and Expenses of Solicitation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 94Stockholder Proposals and Director Nominations for the 2021 Annual Meeting . . . . . . . . 94Other Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 95Appendix A – Reconciliation of Non-GAAP Financial Measures . . . . . . . . . . . . . . . . . . . . . A-1

Table of Contents

ELECTION OF DIRECTORS (Item 1)

RATIFICATION OF APPOINTMENT OF INDEPENDENT AUDITORS (Item 2)ADVISORY VOTE TO APPROVE EXECUTIVE COMPENSATION (Item 3)

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This summary highlights information contained elsewhere in this Proxy Statement. This summarydoes not contain all the information that you should consider, and you should read the entire ProxyStatement before voting. The approximate date on which this Proxy Statement and form of proxyare first being provided to stockholders, or being made available through the Internet for thosestockholders receiving their proxy materials electronically, is September 24, 2020.

2020 Annual Meeting of Stockholders

Date and Time: Tuesday Place: The Annual Meeting will be held in aNovember 10, 2020 virtual-only meeting format via live webcast10:00 a.m., Eastern Time on the Internet:

www.virtualshareholdermeeting.com/EL2020.Record Date: September 11, 2020

Voting Matters

Election of Class III Directors1Ratification of Appointmentof PricewaterhouseCoopers2LLP as Independent Auditors

Advisory Vote to Approve3 Executive Compensation

The following table provides information about the Class III Director Nominees standing forelection to serve until the 2023 Annual Meeting of Stockholders. Information about all theDirectors can be found in this Proxy Statement beginning on page 10.

Charlene Barshefsky Senior International Partner, Compensation Committee andWilmerHale Stock Plan Subcommittee

Wei Sun Christianson Managing Director and Nominating and GovernanceCo-Chief Executive Officer of CommitteeAsia Pacific and ChiefExecutive Officer of China,Morgan Stanley

Fabrizio Freda President and Chief Executive NoneOfficer, The Estée LauderCompanies Inc.

Jane Lauder Executive Vice President, NoneEnterprise Marketing andChief Data Officer, The EstéeLauder Companies Inc.

Leonard A. Lauder Chairman Emeritus, The Estée NoneLauder Companies Inc.

Proxy Statement Summary

BOARD PROXYITEMS OF BUSINESS

RECOMMENDATION STATEMENT DISCLOSURE

Director Nominees

2020 Proxy Statement 1

Nominee Current Position Committee Membership

FOR Page 10each Director Nominee

Page 91FOR

Page 93FOR

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As explained in the ‘‘Compensation Discussion and Analysis,’’ we drive our annual andlong-term performance through our executive compensation programs. Annual incentive pay istied to business objectives that are specific to each employee’s responsibilities and encouragecollaboration across the organization. Long-term equity incentives are tied to both the Company’sshare price and financial goals over a period of three or more years. As explained below, thiscombination of compensation elements is intended to help drive and promote strong, balanced,and sustainable corporate performance.

Fiscal 2020 was an extraordinarily difficult year for the global economy, our business and ourCompany. Our performance in the first half of fiscal 2020 was exceptional and on track to achievebetter than maximum performance on numerous metrics. The momentum continued into thesecond half until the unprecedented impacts of COVID-19 significantly disrupted the lives of ourconsumers, as well as the abilities of our customers and suppliers to operate. During those first fewmonths, and continuing through the rest of fiscal 2020, our management pivoted to captureopportunities in the channels that remained fully functional, made difficult choices, and executedwith excellence using new and existing technologies and new ways of working. The second half alsomarked a period of profound pain as tragic events in the United States highlighted the systemicracial injustice that has plagued our society for far too long. In June 2020, we announced acomprehensive set of commitments to act with urgency on achieving racial equity. Throughout thepast several months, our executive officers and other employees have showcased their agility andflexibility, as well as the family values at the heart of our Company. Reflecting how we are managedon the principles of long-term stewardship and ‘‘patient capital,’’ our citizenship and sustainabilitygoals remain on track.

To help employees in light of the impacts of COVID-19, the Company developed globalinitiatives that were implemented at the regional and local levels, including (i) the establishment ofthe ELC Cares Employee Relief Fund to provide immediate and critical financial relief to eligibleemployees; (ii) a Medical Review Board comprised of senior leaders and leading medical experts toguide the Company on a number of matters, including health and safety policies, guidelines, andprotocols; (iii) access to Company-paid supplemental COVID-19 support (e.g., medical triage servicesand telehealth services) for full-time and part-time employees where necessary and permissible;(iv) a new global Employee Assistance Program with expanded services; (v) enhanced childcare andeldercare benefits; and (vi) for point-of-sale and field employees in locations where retailoperations were closed or experiencing slow recovery, the Company maintained Company-paidhealthcare and other benefits for a period of time.

Performance Highlights

2 2020 Proxy Statement

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In fiscal 2020, our multiple engines of growth strategy proved highly effective. The EstéeLauder brand grew double-digits for the third consecutive year. Asia/Pacific was strong with organicsales growth in mainland China and several other markets driving prestige beauty share gains, ourskin care category grew and was further boosted by the acquisition of Have&Be Co. Ltd.(i.e. Dr. Jart+), and our online channel surged. We quickly pivoted to capture consumption onlineduring COVID-19 as retail stores around the world temporarily closed. Our closing stock price of$188.68 on June 30, 2020 was above our closing stock price of $183.11 on June 28, 2019 (the lasttrading day of fiscal 2019). In fiscal 2020, we increased the common stock dividend rate by 12%,repurchased 5 million shares of our Class A Common Stock for $893 million, and used $623 million ofcash flow from operations for capital expenditures.

Net Sales $14.3 billion (4)% 7% 6%Net Sales as adjusted(1) $14.3 billion (4)% 7% 5%Net Sales as adjusted in

constant currency(1) $14.4 billion (3)% N/A N/A

Operating Margin 4.2% (1,140)bp (1,010)bp (1,070)bpOperating Margin as

adjusted(1) 14.7% (280)bp (120)bp (120)bp

Diluted EPS $ 1.86 (61)% (18)% (8)%Diluted EPS as adjusted(1) $ 4.12 (23)% 6% 6%Diluted EPS as adjusted in

constant currency(1) $ 4.16 (22)% N/A N/A

Return on Invested CapitalReturn on Invested Capital asadjusted(2) 18.5% (720)bp (40)bp (310)bp

Cash Flow from Operations $ 2.3 billion (9)% 8% 3%

Total Stockholder Return(‘‘TSR’’)(3) 3.8% — 102.5% 130.7%TSR – S&P 500 Composite(3) 7.5% — 35.8% 66.5%

(1) Fiscal 2020 Net Sales as adjusted in constant currency excludes the $154 million unfavorableimpact of foreign currency translation. Fiscal 2020, 2019, and 2017 have been adjusted to excludereturns and charges associated with restructuring and other activities and goodwill and otherintangible asset impairments. Fiscal 2020, 2019, 2017 and 2015 have been adjusted to exclude theimpact of changes in the fair value of contingent consideration. Fiscal 2020 has also beenadjusted to exclude long-lived asset impairments, and fiscal 2020 Diluted EPS as adjusted alsoexcludes the gain on a previously held equity method investment. Fiscal 2020 Diluted EPS asadjusted in constant currency excludes the $.04 unfavorable impact of foreign currencytranslation. Fiscal 2019 Diluted EPS as adjusted also excludes the gain on liquidation of aninvestment in a foreign subsidiary, net, and the impact of the provisional charges resulting fromthe enactment of the Tax Cuts and Jobs Act (the ‘‘TCJA’’). Fiscal 2017 has also been adjusted toexclude the China deferred tax asset valuation allowance reversal. Fiscal 2015 has been adjustedfor a charge to remeasure net monetary assets in Venezuela and for the impact of theaccelerated orders associated with the Company’s July 2014 implementation of its StrategicModernization Initiative (‘‘SMI’’). See Appendix A for reconciliation and other information aboutthese non-GAAP financial measures.

(2) Excludes returns and charges associated with restructuring and other activities, goodwill andother intangible asset impairments, long-lived asset impairments and the impact of changes inthe fair value of contingent consideration in each period, where applicable. Fiscal 2020 also


3-Year 5-YearCompound Annual Compound Annual

Growth Rate Growth RateChange over (or Basis Point (or Basis Point

Financial Measure Fiscal 2020 Prior Year Change) Change)

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excludes the tax impact of the gain on a previously held equity method investment. Fiscal 2019excludes the impact of the provisional charges resulting from the enactment of the TCJA on theeffective tax rate and the tax impact of the gain on liquidation of an investment in a foreignsubsidiary, net. See Appendix A for information about this non-GAAP financial measure.

(3) The TSR amounts in the 3-Year and 5-Year Compound Annual Growth Rate columns representthe actual 3-Year and 5-Year total return.

As COVID-19 impacted our business, we implemented a number of cash conservation measures,including suspension of our share repurchase program; not declaring the quarterly cash dividendthat would have been payable in June 2020; temporary salary reductions for senior management;temporary elimination of cash retainers for the Board of Directors; and cutting approximatelyone-third of our planned capital investments for fiscal 2020.

For fiscal 2021, we remain focused on the safety and well-being of our employees andconsumers. Our strategic priorities rightly balance investment in those engines of growth where wesee the greatest opportunities with cost discipline amid the ongoing pandemic. Through thePost-COVID Business Acceleration Program announced in August 2020, we plan to better align ourbrick-and-mortar footprint to improve productivity and invest for growth. We are well-positionedto drive growth as the market dynamics support it, yet remain equally mindful of the effects ofCOVID-19 on consumers, the retail sector and economics, in general, as well as geopoliticaluncertainty.

The following summarizes key executive compensation matters:

• In September 2019, the Compensation Committee (the ‘‘Committee’’) determined that thefiscal 2020 base salary for Fabrizio Freda, our President and Chief Executive Officer, wouldremain at $2.0 million, and his bonus opportunity would remain at $5.0 million; the StockPlan Subcommittee (the ‘‘Subcommittee’’) increased Mr. Freda’s equity target to $10.5 million(from $9.15 million) for fiscal 2020, resulting in target total annual compensation for fiscal2020 of $17.5 million, an increase of 8.4% from the prior fiscal year. As explained below,Mr. Freda and the other senior management took temporary reductions in their base salaries,over a six-month period beginning in late fiscal 2020, to show their solidarity with impactedemployees and to contribute to the Company’s initiatives to reduce expenses and enhancefinancial flexibility and liquidity in light of COVID-19. See additional information in‘‘Compensation Discussion and Analysis — Impact of COVID-19 on Compensation Matters.’’

• The annual stock-based compensation awarded to our Named Executive Officers (the‘‘NEOs’’) in fiscal 2020 was based on target grant levels and an assessment of each officer’sperformance and expected future contributions. The annual equity mix remained weightedequally among performance share units (‘‘PSUs’’), stock options, and restricted stock units(‘‘RSUs’’).

• Payouts under the Executive Annual Incentive Plan for fiscal 2020 reflected the impacts ofCOVID-19, and actual payouts were determined by applying the respective payoutpercentages to the fiscal 2020 target bonus opportunities. Given the outstandingperformance collectively and individually by the various executive officers, theSubcommittee decided to grant additional value, in the form of additional amounts to fiscal2021 annual equity grants, to the NEOs and other executive officers. See ‘‘CompensationDiscussion and Analysis – Impact of COVID-19 on Compensation Matters’’ and ‘‘Impact ofCOVID-19 on Fiscal 2020 Annual Incentive Bonus Payouts and Fiscal 2021 Annual EquityGrants to Named Executive Officers.’’

• Based on the Company’s performance over the three-year period ended June 30, 2020, thePSUs granted to our executive officers in September 2017 resulted in an aggregate payout of109.9% of target. The PSUs were on track to be paid out at the maximum of 150% throughthe first six months of fiscal 2020, but the impacts of COVID-19 on the three metrics resultedin the lower payout percentage. Actual payouts for the NEOs, as applicable, are described innote (4) of ‘‘Outstanding Equity Awards at June 30, 2020’’ table.

Executive Compensation Highlights


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• As part of our efforts to reduce costs and to enhance financial flexibility and liquidity due toCOVID-19, the Compensation Committee (i) reduced the base salaries for seniormanagement, including the NEOs, for the six-month period ending October 2020; and(ii) decided to keep the fiscal 2021 base salaries at the rates established at the start of fiscal2020, subject to the above-mentioned six-month reduction period.

• In August 2020, the Subcommittee approved the payout for the last of three tranches of thenon-annual PSU that was granted to Mr. Freda in September 2015. For the final tranchePerformance Period that ended June 30, 2020, positive Cumulative Operating Income hasbeen achieved, and 129,283 shares will be delivered to him in June 2023, subject to theaward’s terms and conditions. Between September 4, 2015 (the grant date of this award) andJune 30, 2020, (i) the Company has achieved TSR of 158% (the TSR of the S&P 500 Index was78%); and (ii) our market capitalization increased from $29 billion to $68 billion.


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September 24, 2020

This Proxy Statement is furnished in connection with the solicitation of proxies on behalf of theBoard of Directors of The Estée Lauder Companies Inc. (the ‘‘Company,’’ ‘‘we,’’ or ‘‘us’’), a Delawarecorporation, to be voted at the Annual Meeting of Stockholders to be held in a virtual-only meetingformat via live webcast on Tuesday, November 10, 2020, at 10:00 a.m., Eastern Time, and at anyadjournment or postponement of the meeting.

Due to COVID-19, we are holding the Annual Meeting in a virtual-only meeting format, andyou will not be able to attend at a physical location.

If you are a registered stockholder or beneficial owner of Class A Common Stock holding sharesat the close of business on the record date (September 11, 2020), you may attend the AnnualMeeting by visiting www.virtualshareholdermeeting.com/EL2020 and logging in with the 16-digitcontrol number found on your proxy card, voting instruction form, or Notice of Internet Availabilityof Proxy Materials, as applicable. If you do not have your 16-digit control number or are not astockholder, you will be able to register as a guest to view the live webcast by visiting the websitereferenced in this paragraph; however, you will not be able to vote or submit questions during themeeting. You may log into www.virtualshareholdermeeting.com/EL2020 beginning at 9:45 a.m.,Eastern Time, on November 10, 2020. The Annual Meeting will begin promptly at 10:00 a.m.,Eastern Time.

Stockholders of record may submit questions either before or during the meeting. If you wishto submit a question before the meeting, you may log into www.proxyvote.com using your 16-digitcontrol number and follow the instructions to submit a question. Alternatively, to submit a questionduring the meeting, log into the virtual meeting platform at www.virtualshareholdermeeting.com/EL2020 using the 16-digit control number and follow the instructions to submit a question.

Only stockholders of record of shares of Class A Common Stock or Class B Common Stock at theclose of business on the Record Date are entitled to vote at the Annual Meeting and at anyadjournment or postponement of the meeting. Each owner of record of Class A Common Stock onthe Record Date is entitled to one vote for each share of Class A Common Stock. Each owner ofrecord of Class B Common Stock on the Record Date is entitled to ten votes for each share of Class BCommon Stock. As of August 31, 2020, there were 226,139,308 shares of Class A Common Stock and135,067,429 shares of Class B Common Stock issued and outstanding.

In accordance with rules of the Securities and Exchange Commission (the ‘‘SEC’’), we haveelected to furnish to our stockholders this Proxy Statement and our Annual Report to Stockholders

THE ESTÉE LAUDER COMPANIES INC.767 Fifth Avenue

New York, New York 10153

PROXY STATEMENTFOR ANNUAL MEETING OF STOCKHOLDERS

TO BE HELD NOVEMBER 10, 2020

Annual Meeting and Voting

How can I attend the virtual-only Annual Meeting?

How can I ask a question during the Annual Meeting?

Who may vote?

Why did I receive a notice in the mail regarding the Internet availability of the proxy materialsinstead of a paper copy of the proxy materials?


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by providing access to these documents on the Internet rather than mailing printed copies.Accordingly, a Notice of Internet Availability of Proxy Materials (the ‘‘Notice’’) is being mailed to ourstockholders of record and beneficial owners (other than those who previously requested printedcopies or electronic delivery of our proxy materials), which will direct stockholders to a websitewhere they can access our proxy materials and view instructions on how to vote online or bytelephone. If you would prefer to receive a paper copy of our proxy materials, please follow theinstructions included in the Notice.

If you are a stockholder of record (which means your shares are registered directly in your namewith the Company’s transfer agent, Computershare, Inc., or you have a physical stock certificate),you can vote your shares in the following ways: (i) prior to the meeting, you can use the Internet viawww.proxyvote.com and follow the instructions; (ii) if you received a proxy card, you can return theproxy card via mail in the postage paid envelope provided for that purpose; (iii) by telephone; or(iv) by following the instructions provided on the Notice, and by requesting a printed copy of ourproxy materials and completing and returning by mail the proxy card you receive in response toyour request. During the meeting, you may vote online by following the instructions atwww.virtualshareholdermeeting.com/EL2020.

Whichever method you use, each valid proxy received in time will be voted at the AnnualMeeting in accordance with your instructions. To ensure that your proxy is voted, it should bereceived before November 10, 2020. If you submit a proxy without giving instructions, your shareswill be voted as recommended by the Board of Directors.

If you are a beneficial owner of shares held in a stock brokerage account or by a bank or othernominee (i.e. in ‘‘street name’’), on the day of the Annual Meeting, you may go towww.virtualshareholdermeeting.com/EL2020, and log in by entering the 16-digit control numberfound on your proxy card, voting instruction form, or Notice of Internet Availability of ProxyMaterials (the ‘‘Notice’’), as applicable. If you do not have your control number, you will be ableregister as a guest; however, you will not be able to vote or submit questions during the meeting.

If you will not be attending the Annual Meeting, you may vote over the Internet or otherwiseby following the instructions provided in the Notice, or, if you requested to receive printed proxymaterials, you will receive voting instructions from your broker, bank, or nominee describing theavailable processes for voting your shares.

If your shares are held for you by a broker, your broker must vote those shares in accordancewith your instructions. If you do not give voting instructions to your broker, your broker may voteyour shares for you on any discretionary items of business to be voted upon at the Annual Meeting,i.e. the ratification of the appointment of PricewaterhouseCoopers LLP (Item 2).

Important Consideration for ‘‘street name’’ holders: You must instruct your broker if you wantyour shares to be counted in the election of directors at the Annual Meeting (Item 1) and theadvisory vote to approve executive compensation (Item 3). New York Stock Exchange (‘‘NYSE’’) rulesprevent your broker from voting your shares on these matters without your instructions. Pleasefollow the instructions provided by your broker so that your vote can be counted.

All proxies delivered pursuant to this solicitation are revocable at any time before they are exercised,at the option of the persons submitting them, by giving written notice to the Secretary of the Company atthe mailing address set forth below or by submitting a later-dated proxy (either by mail, telephone, orInternet). The mailing address of our principal executive offices is 767 Fifth Avenue, New York,

How do I cast my vote if I am a stockholder of record?

How do I cast my vote if my shares are held in ‘‘street name?’’

May I change my vote?


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New York 10153. If you attend the Annual Meeting at www.virtualshareholdermeeting.com/EL2020, youmay revoke your proxy and change your vote by voting online during the meeting.

The holders of a majority of the votes entitled to be cast by the stockholders entitled to votegenerally, present in person or by proxy, shall constitute a quorum for the transaction of business atthe Annual Meeting. Abstentions, broker non-votes, and votes withheld are included in the countto determine a quorum.

In the event that a quorum does not exist, the Executive Chairman or the holders of a majorityof the votes entitled to be cast by the stockholders who are present in person or by proxy mayadjourn the meeting whether or not a quorum is present. At a subsequent meeting at which aquorum is present, any business may be transacted that might have been transacted at the meetingas originally called.

The following table notes for each proposal: (i) the vote required of Class A Common Stock andClass B Common Stock (voting together) for approval; (ii) whether abstentions count as votes cast;and (iii) whether broker discretionary voting is allowed.

Item 1:Election of Class IIIDirectors Plurality of Votes Cast* Not Applicable No

Item 2:Ratify appointment ofPricewaterhouseCoopers LLP asindependent auditors Majority of Votes Cast No Yes

Item 3:Advisory vote to approveExecutive Compensation Majority of Votes Cast** No No

* In the election of directors (Item 1), shares present at the Annual Meeting that are not voted fora particular nominee, broker non-votes, and shares present by proxy where the stockholderwithholds authority to vote for the nominee will not be counted toward the nominee’sachievement of a plurality.

** The advisory vote to approve executive compensation (Item 3) is not binding on the Company.However, the Compensation Committee and the Stock Plan Subcommittee, which areresponsible for designing and administering the Company’s executive compensation program,value the opinions expressed by stockholders. See ‘‘Compensation Discussion and Analysis –Advisory Vote on Executive Compensation.’’

Abstentions and broker non-votes do not count as votes cast, and therefore have no effect onvote outcomes.

What constitutes a quorum?

What if a quorum is not represented at the Annual Meeting?

How many votes are required to approve a proposal?


Do abstentions Is brokercount as discretionary

Proposal Vote required votes cast? voting allowed?

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All proxies properly submitted pursuant to this solicitation and not revoked will be voted at theAnnual Meeting in accordance with the directions given. In the election of directors (Item 1),stockholders may vote in favor of, or withhold their votes from, each nominee. For the ratificationof the appointment of PricewaterhouseCoopers LLP (Item 2) and the advisory vote to approveexecutive compensation (Item 3), stockholders may vote in favor of the proposal, may vote againstthe proposal, or may abstain from voting. Stockholders should specify their choices on the proxycard or pursuant to the instructions thereon for telephone or Internet voting. If no specific choicesare indicated, the shares represented by a properly submitted proxy will be voted:

1. FOR the election of each nominee as director;

2. FOR the ratification of the appointment of PricewaterhouseCoopers LLP as independentauditors; and

3. FOR the advisory resolution to approve executive compensation.

If you have returned your signed and completed proxy card, and other matters are properlypresented at the Annual Meeting for consideration, the proxy holders appointed by the Board ofDirectors (the persons named in your proxy card if you are a stockholder of record) will have thediscretion to vote on those matters for you.

Representatives of Broadridge Financial Solutions, Inc. will tabulate the votes and act asinspectors of election.

In accordance with Delaware law, a list of registered stockholders entitled to vote at themeeting will be available for examination by any stockholder, for any purpose germane to theAnnual Meeting, by appointment, at the office of Spencer G. Smul, Senior Vice President, DeputyGeneral Counsel and Secretary of the Company, 767 Fifth Avenue, New York, NY 10153, ten daysprior to the Annual Meeting and in electronic form on the day of the Annual Meeting atwww.virtualshareholdermeeting.com/EL2020.

Our Proxy Statement (including Notice of Annual Meeting) and our Annual Report onForm 10-K for the fiscal year ended June 30, 2020 with certain exhibits (which constitutes the‘‘Annual Report to Stockholders’’) are available for stockholders at www.proxyvote.com.

These materials are also available in the ‘‘Investors’’ section of our website atwww.elcompanies.com. Instead of receiving future copies of our Proxy Statement (including Noticeof Annual Meeting) and Annual Report to Stockholders by mail, stockholders can access thesematerials online. Opting to receive your proxy materials online will save us the cost of producingand mailing documents to you; an electronic link to the proxy voting site will be provided to you.Stockholders of record can enroll at www.proxyvote.com for online access to future proxymaterials. If you hold your shares in a bank or brokerage account, you also may have theopportunity to receive copies of these documents electronically. Please check the informationprovided in the proxy materials mailed to you by your bank or broker regarding the availability ofthis service.

How will my shares be voted?

Who will count the vote?

May I see a list of stockholders entitled to vote as of the Record Date?

Can I access the Notice of Annual Meeting, Proxy Statement, and Annual Report toStockholders on the Internet?


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Currently, the Board of Directors (the ‘‘Board’’) is comprised of sixteen directors. The directors are dividedinto three classes, each serving for a period of three years. Class I is comprised of five directors, Class II iscomprised of six directors, and Class III is comprised of five directors.

The stockholders elect one class of the members of the Board of Directors annually. The directors whoseterms will expire at the 2020 Annual Meeting of Stockholders are Charlene Barshefsky, Wei Sun Christianson,Fabrizio Freda, Jane Lauder, and Leonard A. Lauder. Each of these directors has been nominated to stand forre-election as a Class III director at the 2020 Annual Meeting, to hold office until the 2023 Annual Meeting anduntil his or her successor is elected and qualified. In the unanticipated event that one or more of the nomineesis unable or declines to serve for any reason, the Board may reduce the number of directors or take action tofill any vacancy.

Lauder Family Members, including related entities, who control the Company have agreed to vote theirshares in favor of four individuals as directors: Jane Lauder, Leonard A. Lauder, Ronald S. Lauder, and William P.Lauder. The term ‘‘Lauder Family Members’’ is defined below (see ‘‘Certain Relationships and RelatedTransactions – Lauder Family Relationships and Compensation’’).

Director Qualifications. Our Board is comprised of individuals with diverse and complementary businessexperience, leadership experience, and financial experience. Many of our directors have leadershipexperience at major domestic and multinational companies, as well as experience on the boards of othercompanies and organizations, which provides an understanding of different business processes, challenges,and strategies. Other directors have government, legal, public policy, or media experience that providesinsight into issues faced by public companies. The members of the Board are inquisitive and collaborative,challenging yet supportive, and demonstrate maturity and sound judgment in performing their duties. TheBoard believes that the above-mentioned attributes, along with the leadership skills and other experience ofits Board members, some of which are described in the biographies below, provide the appropriateperspectives and judgment to guide the Company’s long-term strategy, monitor progress, and overseemanagement.

The Company does not have a specific policy on diversity of the Board. Instead, the Board evaluatesnominees in the context of the Board as a whole, with the objective of recommending a group that can bestsupport the success of the business and, based on the group’s diversity of experience, represent stockholderinterests through the exercise of sound judgment. Such diversity of experience may be enhanced by a mix ofdifferent professional and personal backgrounds and experiences. The Company is proud to have a diverseBoard, including with respect to gender and race. Seven of our directors are women; one of our directorsself-identifies as Black or African American; and two of our directors self-identify as Asian.

Election of Directors(Item 1)

Board of Directors

The Board recommends a vote FOR each nominee as a director to holdoffice until the 2023 Annual Meeting. Proxies received by the Board will beso voted unless a contrary choice is specified in the proxy.


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Charlene Barshefsky

BACKGROUND QUALIFICATIONS

Ambassador Barshefsky is Senior International Partner International, government, and publicat the law firm of WilmerHale in Washington, D.C. Prior policy experience as United Statesto joining the law firm in 2001, she was the United Trade RepresentativeStates Trade Representative from 1997 to 2001, and

Legal experience, including currentDeputy United States Trade Representative and Actingrole as Senior International Partner atUnited States Trade Representative from 1993 to 1996.WilmerHaleAmbassador Barshefsky is on the boards of directors of

American Express Company and MDC Partners Inc. Board experience at American ExpressAdditionally, within the past five years, she served as a Company, Intel Corporation, MDCDirector since 2001director of Intel Corporation and Starwood Hotels & Partners Inc., and Starwood Hotels &Age 70Resorts Worldwide, Inc. Ambassador Barshefsky is a Resorts Worldwide, Inc.

Committees:member of the Council on Foreign Relations and a Trustee of the Howard HughesCompensation trustee of the Howard Hughes Medical Institute. Medical InstituteCommittee (Chair)

and Stock PlanSubcommittee

Wei Sun Christianson


Ms. Christianson is a Managing Director and Co-Chief Global management and investmentExecutive Officer of Asia Pacific and Chief Executive banking experience as ManagingOfficer of China at Morgan Stanley, a global financial Director and Co-Chief Executiveservices firm. She is based in Beijing, and in addition to Officer of Asia Pacific and Chiefher regional role, Ms. Christianson is responsible for all Executive Officer of China at Morganaspects of Morgan Stanley’s operations in China and is a Stanley based in Beijingmember of Morgan Stanley’s Management Committee.

Experience working abroad,Prior to rejoining Morgan Stanley in 2006, she was theparticularly in ChinaChairman of China for Citigroup Global MarketsDirector since 2011

(Asia Ltd.) and previously served as Chairman of China Financial experienceAge 64and Country Manager for Credit Suisse First Boston. Government experience (in HongCommittee:Ms. Christianson held an earlier position at Morgan Kong)Nominating and Stanley beginning in 1998 as Executive Director and

Governance Beijing Representative.Committee

Nominees for Election to Term Expiring 2023 (Class III)

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Fabrizio Freda


Mr. Freda has served as President and Chief Executive Global management, marketing, andOfficer of the Company since July 2009. From March other business, consumer and luxury2008 through June 2009, he was President and Chief brand industry experience asOperating Officer where he oversaw the Clinique, Bobbi President and Chief Executive OfficerBrown, La Mer, Jo Malone London, Aveda, and Bumble of The Estée Lauder Companies Inc.and bumble brands, and the Aramis and Designer

Similar experience, includingFragrances division. He also was responsible for thedeveloping and leading globalCompany’s International Division, as well as Globalorganizations, in leadership positionsOperations, Research and Development, Packaging,Director since 2009 at P&G and Gucci SpAQuality Assurance, Merchandise Design, Corporate StoreAge 63

Design, and Retail Store Operations. Prior to joining the Experience leading successful, creativeCompany, Mr. Freda served in a number of positions of organizations with innovationincreasing responsibility at The Procter & Gamble programs based on research andCompany (‘‘P&G’’), where he was responsible for various developmentoperating, marketing, and key strategic efforts for over Board experience at BlackRock, Inc.20 years. From 2001 through 2007, Mr. Freda was

Experience living and working inPresident, Global Snacks, at P&G. He also spent moreseveral countriesthan a decade in the Health and Beauty Care division at

P&G. From 1986 to 1988, Mr. Freda directed marketing Financial experienceand strategic planning for Gucci SpA. He is currently amember of the Board of Directors of BlackRock, Inc., aglobal asset management company.

Jane Lauder


Ms. Lauder is Executive Vice President, Enterprise Management, marketing, and otherMarketing and Chief Data Officer. She began her career industry experience throughwith the Company in 1996 at Clinique and has served in leadership roles at The Estée Laudervarious positions throughout the Company. Ms. Lauder Companies Inc.was Global Brand President, Clinique from April 2014 to

Board experience at Eventbrite, Inc.July 2020. Previously, she was Global President, GeneralManager of the Origins, Ojon, and Darphin brands from Significant stockholder and party toJuly 2010 to April 2014. She was Senior Vice President/ Stockholders’ Agreement (solely asGeneral Manager of the Origins brand from July 2008 trustee of one or more trusts)Director since 2009to July 2010, and Senior Vice President, GlobalAge 47Marketing for Clinique from July 2006 to July 2008.Ms. Lauder is a member of the Board of Directors ofEventbrite, Inc.

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Leonard A. Lauder


Mr. L. Lauder is Chairman Emeritus of the Company. He Global business, marketing, andwas Chairman of the Board of Directors from 1995 consumer and luxury brand industrythrough June 2009 and served as the Company’s Chief experience through leadership rolesExecutive Officer from 1982 through 1999 and President at The Estée Lauder Companies Inc.from 1972 until 1995. Mr. Lauder has held various

Experience leading successful creativepositions since formally joining the Company in 1958organizations with innovationafter serving as an officer in the United States Navy. Heprograms based on research andis Chairman Emeritus of the Board of Trustees of thedevelopmentWhitney Museum of American Art, a Charter Trustee ofDirector since 1958

the University of Pennsylvania, a Trustee of The Aspen Affiliation with leading business, civic,Age 87Institute, and the co-founder and Co-Chairman of the and public policy associationsAlzheimer’s Drug Discovery Foundation. Mr. Lauder is Charter Trustee of the University ofHonorary Chairman of the Breast Cancer Research PennsylvaniaFoundation. He served as a member of the White House

Significant stockholder and party toAdvisory Committee on Trade Policy and NegotiationsStockholders’ Agreementunder President Reagan.

Rose Marie Bravo, CBE


Ms. Bravo is a retail and marketing consultant. She was Global management, marketing,Vice Chairman of Burberry Group plc from July 2006 to retail, and consumer and luxuryJuly 2007. Prior to that, she was Burberry’s Chief brand industry experience as formerExecutive Officer from 1997 to July 2006. Prior to her Chief Executive Officer of Burberry, inappointment at Burberry, Ms. Bravo was President of various leadership positions at SaksSaks Fifth Avenue since 1992, with responsibility for Fifth Avenue and Macy’s, and inmerchandising, marketing, and product development. senior roles related to merchandisingFrom 1974 to 1992, Ms. Bravo held a number of in the beauty categorypositions at R.H. Macy & Co., culminating as ChairmanDirector since 2003 Board experience at Burberry,and Chief Executive Officer of the U.S. retailer I.Age 69 Tiffany & Co., and Williams-Magnin from 1987 to 1992. Ms. Bravo is a member of

Committees: Sonoma, Inc.the Board of Directors of Tiffany & Co. Additionally,Compensation within the past five years, she served as a director of Experience working abroadCommittee and Williams-Sonoma, Inc. Merchandise and productStock Plan

development expertiseSubcommittee

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Paul J. Fribourg


Mr. Fribourg is the Chairman and Chief Executive Global management, marketing, andOfficer of Continental Grain Company, an international other business experience asagribusiness and investment company. He joined Chairman and Chief Executive OfficerContinental Grain Company in 1976 and worked in of Continental Grain Companyvarious positions there with increasing responsibility in

Board experience at Apollo Globalboth the United States and Europe. Mr. Fribourg is onManagement, LLC, Bunge Limited,the boards of directors of Bunge Limited, LoewsLoews Corporation, and RestaurantCorporation, and Restaurant Brands International Inc.Brands International Inc.Additionally, within the past five years, he served as aDirector since 2006

director of Apollo Global Management, LLC. He is a Affiliation with leading business andAge 66member of Rabobank’s International North American public policy associations (Council on

Committees:Agribusiness Advisory Board, Temasek Americas Foreign Relations)

Audit Committee Advisory Panel, and the International Business Leaders’ Financial experienceCompensation Advisory Council for The Mayor of Shanghai.Committee and Mr. Fribourg also serves as a board member andStock Plan Executive Committee member of Castleton CommoditiesSubcommittee International LLC. He has been a member of the Council

on Foreign Relations since 1985.

Irvine O. Hockaday, Jr.


Mr. Hockaday is the former President and Chief Global business experience andExecutive Officer of Hallmark Cards, Inc. Prior to joining consumer brand industry experienceHallmark in 1983, he was President and Chief Executive as former CEO of Hallmark Cards, Inc.Officer of Kansas City Southern Industries, Inc.

Board experience at AratanaMr. Hockaday retired from Hallmark in December 2001,Therapeutics, Inc., Crown Mediaand he was a member of the Hallmark Board ofHoldings, Inc., Ford Motor Company,Directors from 1978 until January 2002. Within the pastand Sprint Nextelfive years, he served as a member of the Board of

Directors of Aratana Therapeutics, Inc. Financial experienceDirector since 2001Age 84 Legal experiencePresiding Director

Committee:

Nominating andGovernanceCommittee (Chair)

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Jennifer Hyman


Ms. Hyman is Co-founder and Chief Executive Officer of Management and entrepreneurialRent the Runway, Inc., which rents designer clothing experience as Co-founder and Chiefand accessories to women both on-demand and Executive Officer of Rent thethrough its subscription service. Prior to co-founding Runway, Inc.Rent the Runway, Inc. in 2009, she was Director of

Deep knowledge about millennialsBusiness Management at IMG, a global talentand other consumersmanagement company, from 2006 to 2007. Ms. Hyman

was Senior Manager, Sales, at the WeddingChannel.com Omnichannel, disruptive technology,from 2005 to 2006. From 2002 to 2005, she was Senior and social-digital experienceDirector since 2018Manager, Leisure Program Development, at StarwoodAge 40 Board experience at Rent theHotels & Resorts Worldwide, Inc. Ms. Hyman is a Runway, Inc. and Zalando SECommittee:member of the Board of Directors of Zalando SE.

Audit Committee Financial experience

Barry S. Sternlicht


Mr. Sternlicht is Chairman and Chief Executive Officer of Global business, investment, realStarwood Capital Group, a privately-held global estate, financial, private equity,investment firm with a primary focus on global real entrepreneurial, and consumer brandestate. He also serves as Chairman and CEO of Starwood and luxury industry expertise atProperty Trust, Inc., a commercial mortgage REIT. Starwood Capital Group, as ChairmanMr. Sternlicht is the Chairman of the Board of Starwood of Starwood Property Trust, Inc., asReal Estate Income Trust, Inc. and is on the Board of Chairman of the Board of StarwoodDirectors of A.S. Roma. Additionally, within the past Real Estate Trust, Inc., and as founderfive years, he served as a director of Baccarat S.A., TRI and former Chief Executive ofDirector since 2004Pointe Group Inc., and Invitation Homes, Inc. From 1995 Starwood Hotels & ResortsAge 59through early 2005, Mr. Sternlicht was Chairman and Worldwide, Inc.Committee:CEO of Starwood Hotels & Resorts Worldwide, Inc. He

Board experience at A.S. Roma,Nominating and currently serves as a member of the board of The RobinBaccarat S.A., Invitation Homes, Inc.,Governance Hood Foundation, and he is on the board of the

Committee Restoration Hardware Holdings, Inc.,Dreamland Film & Performing Arts Center and theRiviera Holdings Corporation,Executive Advisory Board of Americans for the Arts.Starwood Property Trust, Inc., and TRIPointe Group, Inc.

Financial experience

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Ronald S. Lauder


Mr. R. Lauder is Chairman of Clinique Laboratories, LLC. Global business, marketing, andHe was Chairman of Estee Lauder International, Inc. consumer and luxury brand industryfrom 1987 through 2002. Mr. Lauder joined the experience through leadership rolesCompany in 1964 and has served in various capacities. at The Estée Lauder Companies Inc.He was a member of the Board of Directors of the

Affiliation with leading business, civic,Company from 1968 to 1986 and again from 1988 toand government associationsJuly 2009, prior to rejoining the Board in 2016. From

1983 to 1986, Mr. Lauder served as Deputy Assistant Board experience at Central EuropeanSecretary of Defense for European and NATO Affairs. Media Enterprises Ltd.Director since 2016From 1986 to 1987, he was U.S. Ambassador to Austria.Age 76 Significant stockholder and party toMr. Lauder is an Honorary Chairman of the Board of Stockholders’ AgreementTrustees of the Museum of Modern Art and President ofthe Neue Galerie. He is also Chairman of the Board ofGovernors of the Joseph H. Lauder Institute ofManagement and International Studies at The WhartonSchool at the University of Pennsylvania and theco-founder and Co-Chairman of the Alzheimer’s DrugDiscovery Foundation.

William P. Lauder


Mr. W. Lauder is Executive Chairman of the Company Global business, marketing, Internet,and, in such role, he is Chairman of the Board of retail, and consumer and luxuryDirectors. He was Chief Executive Officer of the brand industry experience throughCompany from March 2008 through June 2009 and leadership roles at The Estée LauderPresident and Chief Executive Officer from July 2004 Companies Inc.through February 2008. From January 2003 through

Experience leading successful creativeJune 2004, he was Chief Operating Officer. Mr. Lauderorganizations with innovationjoined the Company in 1986 and has served in variousprograms based on research andcapacities. From July 2001 through 2002, he was GroupDirector since 1996 developmentPresident, responsible for the worldwide business of theAge 60

Clinique and Origins brands and the Company’s retail Board experience at GLGCommittee:

store and online operations. From 1998 to 2001, Partners, Inc., Jarden Corporation,Nominating and Mr. Lauder was President of Clinique Laboratories, LLC. and True Temper Sports, Inc.Governance Prior to 1998, he was President of Origins Natural Trustee of the University ofCommittee Resources Inc. Within the past five years, Mr. Lauder Pennsylvania and lecturer at The

served as a director of Jarden Corporation. He currently Wharton Schoolserves as Chairman of the Board of the Fresh Air Fund,

Financial experienceas a member of the boards of trustees of the Universityof Pennsylvania and The Trinity School in New York City, Significant stockholder and party toand as a member of the boards of directors of the Stockholders’ Agreement92nd Street Y and the Partnership for New York City,and he is on the Advisory Board of Zelnick Media.Mr. Lauder is also Co-Chairman of the Breast CancerResearch Foundation.

Incumbent Directors – Term Expiring 2022 (Class II)

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Richard D. Parsons


Mr. Parsons is a senior advisor to Providence Equity Global business, marketing, media,Partners LLC, a global private equity and investment Internet, banking, and other businessfirm, and he is a co-founder and partner of Imagination and consumer brand experienceCapital LLC, a venture capital firm. From 1996 until through leadership roles at Time2012, he was a director of Citigroup Inc. and served as Warner Inc. and Dime Bancorp, Inc.its Chairman from February 2009 to April 2012. From

Board experience at CBS Corporation,May 2003 until his retirement in December 2008,Citigroup Inc., Lazard Ltd., TheMr. Parsons served as Chairman of the Board of TimeMadison Square Garden Company,Warner Inc. From May 2002 until December 2007, heDirector since 1999 and Time Warner Inc.served as Chief Executive Officer of Time Warner Inc.Age 72

From January 2001 until May 2002, Mr. Parsons was Private equity experience atCommittees:

Co-Chief Operating Officer of AOL Time Warner. From Providence Equity Partners LLCCompensation 1995 until the merger with America On-Line Inc., he Legal and government experienceCommittee was President of Time Warner Inc. From 1990 throughNominating and Financial experience1994, he was Chairman and Chief Executive Officer ofGovernance Dime Bancorp, Inc. Mr. Parsons is on the boards ofCommittee directors of Lazard Ltd. and The Madison Square

Garden Company. Additionally, within the past fiveyears, he served as a director of CBS Corporation.Among his numerous community activities, he isChairman of the Apollo Theatre Foundation, Chairmanof the Jazz Foundation of America, and Chairman ofthe Rockefeller Foundation.

Lynn Forester de Rothschild


Lady de Rothschild is the Chair of E.L. Rothschild LLC, a Global business and investmentprivate investment company with investments in media, experience as former Chief Executiveinformation technology, agriculture, financial services, of E.L. Rothschild LLC and CEO ofand real estate worldwide. She was the Chief Executive FirstMark Holdings, Inc.of E.L. Rothschild LLC from 2002 to 2016. Lady de

Board and media experience asRothschild has been a director of The Economistdirector of The Economist NewspaperNewspaper Limited since October 2002. From 1989 toLimited2002, she was President and Chief Executive Officer of

FirstMark Holdings, Inc. She serves on the Board and Affiliation with leading business andDirector since 2000Executive Committee of The Peterson Institute for public policy associations (Council onAge 66International Economics. Lady de Rothschild is a trustee Foreign Relations)

Committee:of the Eranda Foundation and a board member of the Experience working abroadNominating and International Advisory Board of Columbia University

Governance Legal and government expertiseSchool of Law and the Alzheimer Drug DiscoveryCommittee Foundation. She is a member of the Council on Foreign Financial experience

Relations (USA), Chatham House (UK), the InternationalAdvisory Council of Asia House (UK), the InternationalInstitute of Strategic Studies (UK), and the ForeignPolicy Association (USA).

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Jennifer Tejada


Ms. Tejada is Chief Executive Officer and Chair of the Management experience atBoard of PagerDuty, Inc., a digital operations PagerDuty, Inc., Keynote Systemsmanagement platform for businesses. Prior to joining Corporation, and MincomPagerDuty in 2016, she was President and Chief

Digital, mobile, cyber, and softwareExecutive Officer of Keynote Systems Corporation, aexperiencesoftware company specializing in digital performance

analytics and web and mobile testing, from 2013 to Consumer goods experience2015. Ms. Tejada was Executive Vice President and Chief Experience working abroadStrategy Officer of Mincom, an enterprise softwareDirector since 2018

Board experience at PagerDuty, Inc.,company, from 2008 to 2011. She has also previouslyAge 49Keynote Systems Corporation, andheld senior positions at Merivale Group, The Procter &

Committee: Puppet Labs, Inc.Gamble Company, and i2 TechnologiesAudit Committee

Financial experience

Richard F. Zannino


Mr. Zannino is a Managing Director at the private Management, media, finance, retail,equity firm CCMP Capital Advisors, LLC. He is a partner and consumer brand industryon the firm’s Investment Committee and co-heads the experience in various positions atconsumer retail practice. Prior to joining CCMP Capital, Dow Jones & Company, Inc., LizMr. Zannino was an independent retail and media Claiborne, Inc., and Saks Fifth Avenueadvisor from February 2008 to June 2009. He was Chief

Consumer, retail, media, and privateExecutive Officer and a member of the Board ofequity experience at CCMP CapitalDirectors of Dow Jones & Company, Inc. from FebruaryAdvisors, LLC2006 until January 2008. Mr. Zannino joined Dow JonesDirector since 2010

as Executive Vice President and Chief Financial Officer in Board experience at Dow Jones &Age 61February 2001 and was promoted to Chief Operating Company, Inc., Francesca’s Holdings

Committee:Officer in July 2002. From 1998 to 2001, he was Corporation, IAC/InterActiveCorp, and

Audit Committee Executive Vice President of Liz Claiborne, Inc., where he Ollie’s Bargain Outlet Holdings, Inc.(Chair) oversaw the finance, administration, retail, fragrance, Trustee of Pace University

and licensing divisions. From 1993 to 1998, Mr. ZanninoFinancial experiencewas with Saks Fifth Avenue, serving as Vice President

and Treasurer, Senior Vice President, Finance andMerchandise Planning, and then Executive VicePresident and Chief Financial Officer. He is on theboards of directors of IAC/InterActiveCorp and Ollie’sBargain Outlet Holdings, Inc. Additionally, within thepast five years, Mr. Zannino served as a director ofFrancesca’s Holdings Corporation. He currently serves asVice Chairman of the Board of Trustees of PaceUniversity.

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Stockholders’ Agreement and Lauder Family Control. All Lauder Family Members who areparty to a stockholders’ agreement with the Company (the ‘‘Stockholders’ Agreement’’) haveagreed to vote shares beneficially owned by them for Leonard A. Lauder (or for one of his sons),Ronald S. Lauder (or for one of his daughters), and one person, if any, designated by each as adirector of the Company. Aerin Lauder and Jane Lauder are parties to the Stockholders’ Agreementsolely as trustees of certain trusts. The term ‘‘Lauder Family Members’’ is defined below (see ‘‘CertainRelationships and Related Transactions – Lauder Family Relationships and Compensation’’). Sharessubject to the Stockholders’ Agreement represent approximately 84% of the voting power of theCompany as of the Record Date. The right of each of Leonard A. Lauder (or his sons) and Ronald S.Lauder (or his daughters) to designate a nominee exists only when he (including his descendants)beneficially owns (other than by reason of the Stockholders’ Agreement) shares of Common Stockwith at least 10% of the total voting power of the Company. Currently, William P. Lauder is thenominee of Leonard A. Lauder, and Jane Lauder is the nominee of Ronald S. Lauder. The right ofeach of Leonard A. Lauder (or one of his sons) and Ronald S. Lauder (or one of his daughters) to benominated will exist so long as he (including his descendants) beneficially owns shares of CommonStock with at least 5% of the total voting power of the Company. In the event that Leonard A.Lauder ceases to be a member of the Board of Directors by reason of his death or disability, then hissons, William P. Lauder and Gary M. Lauder, will succeed to his rights to be nominated as a directorand to designate one nominee. If either son is unable to serve by reason of his death or disability,the other son will have the right to designate a nominee. Similarly, Aerin Lauder and Jane Lauder,Ronald S. Lauder’s daughters, will succeed to their father’s rights upon his death or disability. Ifeither daughter is unable to serve by reason of her death or disability, the other daughter will havethe right to designate a nominee. In the event none of Leonard A. Lauder and his sons and Ronald S.Lauder and his daughters are able to serve as directors by reason of death or disability, then therights under the Stockholders’ Agreement to be a nominee and to designate a nominee will cease.The Stockholders’ Agreement contains a ‘‘sunset provision.’’ Under this provision, the Stockholders’Agreement will terminate upon the occurrence of certain specified events, including the transfer ofshares of Common Stock by a party to the Stockholders’ Agreement that causes all parties theretoimmediately after such transaction to own beneficially in the aggregate shares having less than10% of the total voting power of the Company.

The Lauder family has direct and indirect holdings of approximately 86% of the voting powerof the Company as of the Record Date. The Company is a ‘‘controlled company’’ under the rules ofthe New York Stock Exchange (the ‘‘NYSE’’) because the Lauder family and their related entitieshold more than 50% of the voting power of the outstanding voting stock. As such, the Companymay avail itself of exemptions relating to the Board and certain Board committees. Despite theavailability of such exemptions, the Board of Directors has determined that it will have a majority ofindependent directors and that both the Nominating and Governance Committee and theCompensation Committee will have otherwise required provisions in their charters. As permitted bythe NYSE rules for ‘‘controlled companies,’’ our Board does not require that the Nominating andGovernance Committee and the Compensation Committee be comprised solely of independentdirectors.

Board Committees. The Board of Directors has established the following standing committees:the Audit Committee; the Compensation Committee (which includes the Stock Plan Subcommittee);and the Nominating and Governance Committee. Each director on these committees is anindependent director except for William P. Lauder and Richard D. Parsons. Each committee reportsregularly to the Board and has the authority to engage its own advisors. From time to time, theBoard considers the composition of our Board committees.

Additional Information Regarding the Board of Directors


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The members of the committees as of the Record Date are set forth in the following table:

Charlene Barshefsky†

Rose Marie Bravo†

Wei Sun Christianson

Paul J. Fribourg†

Jennifer Hyman

Irvine O. Hockaday, Jr.*

William P. Lauder

Richard D. Parsons

Lynn Forester de Rothschild

Barry S. Sternlicht

Jennifer Tejada

Richard F. Zannino

Chair Member

† Also member of Stock Plan Subcommittee

* Presiding Director

Copies of the charters adopted by the Board of Directors for each committee may be found inthe ‘‘Investors’’ section of the Company’s website, www.elcompanies.com, under ‘‘CorporateGovernance.’’

The Audit Committee, among other things, appoints the independent auditors; reviews theindependence of such auditors; approves the scope of the annual audit activities of theindependent auditors and the Company’s Internal Audit department; reviews audit results; reviewsand discusses the Company’s financial statements with management and the independent auditors;reviews and discusses with the Board the Company’s policies for risk assessment and riskmanagement; and is responsible for our related person transactions policy. The committee’s scopeof oversight responsibilities includes information technology, cybersecurity, taxes, treasury, andlegal matters. The committee meets periodically with the Chief Financial Officer, the head ofinternal audit, and representatives of the independent auditors. The Board of Directors hasdetermined that each of Mr. Fribourg and Mr. Zannino qualifies as an ‘‘Audit Committee FinancialExpert’’ in accordance with SEC rules.


• •• •

Nominating andAudit Compensation Governance

Director Committee Committee Committee

Audit Richard F. Zannino (Chair) Jennifer HymanCommittee Paul J. Fribourg Jennifer Tejada

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The Compensation Committee establishes and approves compensation plans andarrangements with respect to the Company’s executive officers and administers the Company’sExecutive Annual Incentive Plan. The Stock Plan Subcommittee has authority over all decisionsregarding awards to executive officers under the Company’s share incentive plans and authority toadminister the Company’s share incentive plans under which executive officers and otheremployees may receive equity grants. The Company also has an Employee Equity AwardCommittee, the sole member of which is Mr. Freda; the purpose of this committee is to make limitedgrants of equity awards under the share incentive plan to employees who are not executive officers.During fiscal 2020, the Employee Equity Award Committee did not make any grants.

Compensation Committee Interlocks and Insider Participation. During fiscal 2020, AmbassadorBarshefsky, Ms. Bravo, Mr. Fribourg, and Mr. Parsons served on the Compensation Committee. Noneof these directors is a former or current officer or employee of the Company or any of itssubsidiaries. During fiscal 2020, none of our executive officers served as a member of thecompensation committee (or other committee performing similar functions) or as a director of anyother entity of which an executive officer served on our Board or Compensation Committee. Noneof the directors who served on our Compensation Committee during fiscal 2020 has anyrelationship requiring disclosure under this caption under SEC rules.

The Nominating and Governance Committee’s responsibility for corporate governance mattersincludes oversight of the Company’s environmental, social, and governance (‘‘ESG’’) activities andpractices, including citizenship and sustainability matters. Among other things, the committeeproposes candidates to fill vacancies on the Board and recommends nominees for election asmembers of the Board; oversees CEO succession planning; considers and makes recommendationsregarding Board practices and procedures; considers corporate governance issues that arise fromtime to time and makes appropriate recommendations for the Board regarding such matters; andreviews the compensation for service as a Board member.

Board and Board Committee Meetings; Annual Meeting Attendance; and Executive Sessions.Directors are expected to devote sufficient time to carrying out their duties and responsibilitieseffectively, and should be committed to serve on the Board for an extended period of time. Infurtherance of the Board’s role, directors are expected to attend all scheduled Board and Boardcommittee meetings and all meetings of stockholders. In fiscal 2020, the Board of Directors met fivetimes, the Audit Committee met eight times, the Compensation Committee met six times (and theStock Plan Subcommittee met five times), and the Nominating and Governance Committee metfour times. The total combined attendance for all Board and committee meetings in fiscal 2020 wasover 95%. No director attended less than 75% of Board and committee meetings in fiscal 2020. Thenon-employee directors met five times in executive session in fiscal 2020. Directors are expected toattend the Annual Meeting of Stockholders, and all of the directors who were on the Boardattended the Annual Meeting of Stockholders in November 2019.

Board Leadership Structure. Our Board is currently led by our Executive Chairman, who is amember of the Lauder family. In addition, we have an independent director who serves as ourPresiding Director. A majority of the directors on our Board are independent. At present, there are16 directors on our Board, comprised of: (i) our President and Chief Executive Officer (‘‘CEO’’); (ii) 11


• •• •

• •• •• •

Compensation Charlene Barshefsky (Chair) Paul J. FribourgCommittee Rose Marie Bravo Richard D. Parsons

Nominating and Irvine O. Hockaday, Jr. (Chair) Richard D. ParsonsGovernance Wei Sun Christianson Lynn Forester de RothschildCommittee William P. Lauder Barry S. Sternlicht

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non-employee directors (10 of whom are independent); and (iii) 4 directors who are members of theLauder family, including our Executive Chairman. The Presiding Director presides at all meetings orexecutive sessions of non-employee or independent directors. The Board of Directors considers thisstructure appropriate in view of the Lauder family’s significant investment in the Company. Thestructure also comports with the Stockholders’ Agreement among various members of the Lauderfamily and the Company. See ‘‘Additional Information Regarding the Board of Directors –Stockholders’ Agreement and Lauder Family Control.’’

In addition to his responsibilities as Chairman of the Board, Mr. W. Lauder, as ExecutiveChairman, works with the President and CEO to set overall vision, strategy, financial objectives, andinvestment priorities for the business. Mr. W. Lauder also continues to provide high-level leadershipin areas that are important to the Company, including marketing, trade relations, globalcommunications, and regulatory affairs.

As provided in our Corporate Governance Guidelines, an independent director serves as ourPresiding Director. The Presiding Director serves a one-year term beginning with the meeting of theBoard immediately following the Annual Meeting of Stockholders. Mr. Hockaday served as thePresiding Director for all executive sessions of the Board of Directors in fiscal 2020, and he has beenappointed by the Board to serve for an additional one-year term beginning after the 2020 AnnualMeeting.

CEO Succession Planning Process. Our Board of Directors works closely with the Nominatingand Governance Committee regarding CEO succession planning and reviews succession plans on anongoing basis. The Board has numerous opportunities to meet with, and assess development plansfor, members of management and other potential leaders, including through formal presentationsto the Board and its committees, as well as informal discussions and events. The Board hasestablished a succession process in the event of the death or disability of the CEO.

Board Role in Risk Oversight. Our Board of Directors regularly receives reports from our CEOand other members of senior management regarding areas of significant risk to us, includingstrategic, operational, financial, legal and regulatory, cybersecurity, and reputational risks.However, senior management is responsible for assessing and managing the Company’s various riskexposures on a day-to-day basis. In this regard, various management functions within the Company,such as Legal, Finance, Treasury, Internal Audit, Information Technology, Global Supply Chain,Research & Development, and Environmental Affairs and Safety, focus on particular risks.Management has a systemic and integrated approach to overall risk management that includes theidentification of risks and mitigation plans in the strategic planning process. The Board’s role is oneof oversight, assessing major risks facing the Company and reviewing options for their mitigationwith management. In addition, the Audit Committee reviews and discusses with management ourenterprise risk management processes.

Risk in Compensation Programs. The Company has a framework for evaluating incentive plandesign features that may encourage or help mitigate risk, such as a mix of compensation elements,metrics, leverage, caps, and time horizons, in order to determine whether the risks arising from ourcompensation programs (in addition to those applicable only to executive officers) are reasonablylikely to have a material adverse effect on the Company. Using this framework in fiscal 2020, weconcluded that our compensation programs are not reasonably likely to have a material adverseeffect on the Company. The results were reviewed with senior management and the CompensationCommittee.

Board Membership Criteria. The Nominating and Governance Committee works with the Boardon an annual basis to determine the appropriate characteristics, skills, and experience for the Boardas a whole and its individual members. All directors should possess the highest personal andprofessional ethics as well as an inquisitive and objective perspective, practical wisdom, and maturejudgment. In evaluating the suitability of individual Board members, the Board takes into account


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many factors, including general understanding of marketing, finance, and other disciplinesrelevant to the success of a large publicly traded company in today’s business environment;understanding of the Company’s business on a technical level; and educational and professionalbackground. The Board evaluates each individual in the context of the Board as a whole, with theobjective of recommending a group that can best support the success of the business and, based onits diversity of experience, represent stockholder interests through the exercise of sound judgment.In determining whether to recommend a director for re-election, the Nominating and GovernanceCommittee also considers the director’s past attendance at meetings and participation in andcontributions to the activities of the Board.

Upon determining the need for a new director candidate, the Nominating and GovernanceCommittee will identify one or more director candidates and evaluate each candidate under thecriteria described above based on the information it receives with a recommendation or that itotherwise possesses, which information may be supplemented by additional inquiries. Applicationof these criteria involves the exercise of judgment and cannot be measured in any mathematical orroutine way. Based on its assessment of each candidate’s independence, skills, and qualificationsand the criteria described above, the Committee will make recommendations regarding potentialdirector candidates to the Board. The Committee has engaged a third-party firm to assist withidentifying and evaluating potential director candidates. The Committee will evaluate stockholder-recommended candidates in the same manner as other candidates. Candidates may also bedesignated pursuant to the Stockholders’ Agreement. See ‘‘Additional Information Regarding theBoard of Directors – Stockholders’ Agreement and Lauder Family Control.’’

Board Independence Standards for Directors. To be considered ‘‘independent’’ for purposes ofmembership on the Company’s Board of Directors, the Board must determine that a director has nomaterial relationship with the Company, including any of its subsidiaries, other than as a director.For each director, the Board broadly considers all relevant facts and circumstances. In making itsdetermination, the Board considers the following categories of relationships to be material, thusprecluding a determination that a director is ‘‘independent:’’

(i) the director is an employee of the Company, or an immediate family member of the director isan executive officer of the Company, or was so employed during the last three years.

(ii) the director receives, or an immediate family member of the director receives, during anytwelve-month period within the last three years, more than $120,000 in direct compensationfrom the Company, other than director and committee fees and pension or other forms ofdeferred compensation for prior service (provided such compensation is not contingent in anyway on continued service).

(iii) (A) the director is a current partner or employee of a firm that is the Company’s internal orexternal auditor, (B) the director has an immediate family member who is a current partner ofsuch a firm, (C) the director has an immediate family member who is a current employee of sucha firm and personally works on the Company’s audit, or (D) the director or an immediate familymember of the director was within the last three years a partner or employee of such a firm andpersonally worked on the Company’s audit within that time.

(iv) the director or an immediate family member of the director is, or has been within the last threeyears, employed as an executive officer of another company where any of the Company’spresent executive officers at the same time serves or served on that company’s compensationcommittee.

(v) the director is a current employee, or an immediate family member of the director is a currentexecutive officer, of a company that has made payments to, or received payments from, theCompany for property or services in an amount which, in any of the last three fiscal years,exceeds the greater of $1 million, or 2% of such other company’s consolidated gross revenues.


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Additionally, the following relationships will not be considered to be ‘‘material’’ relationshipsthat would impair a director’s independence:

(i) any of the relationships described in (i)-(v) above, if such relationships occurred more thanthree years ago, or

(ii) if a director is a current employee, or an immediate family member of a director is a currentexecutive officer of another company that does business with the Company and such othercompany, during the current or last fiscal year, made payments to, or received payments from,the Company of less than $1 million or 2% of such other company’s consolidated grossrevenues, whichever is greater.

Contributions to tax exempt organizations shall not be considered payments for purposes ofthese independence standards. An ‘‘immediate family member’’ includes a director’s spouse,parents, children, siblings, mothers- and fathers-in-law, sons- and daughters-in-law, brothers- andsisters-in-law, and anyone (other than domestic employees) who shares such person’s home.

The Board reviews at least annually whether directors meet these Director IndependenceStandards. The following directors have been determined by the Board to be ‘‘independent’’pursuant to NYSE rules and the Company’s Independent Director Standards described above:Charlene Barshefsky, Rose Marie Bravo, Wei Sun Christianson, Paul J. Fribourg, Irvine O. Hockaday,Jr., Jennifer Hyman, Lynn Forester de Rothschild, Barry S. Sternlicht, Jennifer Tejada, and Richard F.Zannino. In addition to the foregoing, in order to be considered ‘‘independent’’ under NYSE rulesfor purposes of serving on the Company’s Audit Committee or Compensation Committee, a directoralso may not accept, directly or indirectly, any consulting, advisory, or other compensatory fee fromthe Company, other than as a director, and may not be an ‘‘affiliated person’’ of the Company. AuditCommittee members may receive directors’ fees and fixed payments for prior service with theCompany. The Board has determined that each member of the Audit Committee and eachindependent member of the Compensation Committee meets these additional independencerequirements.

Communications with the Board. A stockholder or any other interested party maycommunicate with the Board, any Committee thereof, the non-management directors as a group,or any individual director, including the Presiding Director, by addressing the correspondence tothat individual or group, c/o General Counsel, The Estée Lauder Companies Inc., 767 Fifth Avenue,New York, New York 10153. The General Counsel or a designee will review such correspondence andforward to the intended recipient(s) if the substance relates to the duties and responsibilities of theBoard or director; at the discretion of the General Counsel or a designee, materials considered to beinappropriate or harassing, unsolicited advertisements, or promotional materials may not beforwarded.

Director Nominees Recommended by Stockholders. The Nominating and GovernanceCommittee will consider stockholder recommendations of nominees in the same manner as andpursuant to the same criteria by which it considers all other nominees, except for nominationsreceived pursuant to the Stockholders’ Agreement. Stockholders who wish to suggest qualifiedcandidates should send their written recommendation to the Nominating and GovernanceCommittee, c/o General Counsel, The Estée Lauder Companies Inc., 767 Fifth Avenue, New York,New York 10153. The following information must accompany any such recommendation by astockholder: (i) the name and address of the stockholder making the recommendation; (ii) thename, address, telephone number, and social security number of the proposed nominee; (iii) theclass or series and number of shares of the Company that are beneficially owned by the stockholdermaking the recommendation; (iv) a description of all arrangements or understandings between thestockholder and the candidate, and an executed written consent of the proposed nominee to serveas a director of the Company if so elected; (v) a copy of the proposed nominee’s resume andreferences; and (vi) an analysis of the candidate’s qualifications to serve on the Board of Directorsand on each of the Board’s committees in light of the criteria for Board membership established by


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the Board. See ‘‘Board Membership Criteria.’’ For stockholders intending to nominate an individualfor election as a director directly, there are specific procedures set forth in our bylaws. See‘‘Stockholder Proposals and Director Nominations for the 2021 Annual Meeting’’ below.

The Board of Directors has developed corporate governance practices to help it fulfill itsresponsibilities to stockholders in providing general direction and oversight of management of theCompany. These practices are set forth in the Company’s Corporate Governance Guidelines. TheCompany also has a Code of Conduct (the ‘‘Code’’) applicable to all employees, officers, anddirectors of the Company including the Chief Executive Officer and the Chief Financial Officer.These documents, as well as any waiver of a provision of the Code granted to any senior officer ordirector or any material amendment to the Code, may be found in the ‘‘Investors’’ section of theCompany’s website: www.elcompanies.com under ‘‘Corporate Governance.’’

We have a written policy (the ‘‘Related Person Transactions Policy’’) that sets forth proceduresfor the review, approval, and ratification of transactions involving ‘‘Related Persons.’’ Such personsconsist of any director, director nominee, executive officer, any beneficial owner of mo

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