DEF 14A

DEF 14A 1 d212116ddef14a.htm DEF 14A DEF 14A

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

SCHEDULE 14A

(RULE 14a-101)

SCHEDULE 14A INFORMATION

Proxy Statement Pursuant to Section 14(a) of the Securities

Exchange Act of 1934 (Amendment No. )

Filed by the Registrant ☑

Filed by a Party other than the Registrant ☐

Check the appropriate box:

☐	Preliminary Proxy Statement

☐	Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))

☑	Definitive Proxy Statement

☐	Definitive Additional Materials

☐	Soliciting Material Pursuant to §240.14a-12

The Timken Company

(Name of Registrant as Specified In Its Charter)

(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

Payment of Filing Fee (Check all boxes that apply):

☑	No fee required.

☐	Fee paid previoulsy with preliminary materials.

☐	Fee computed on table in exhibit required by Item 25(b) per Exchange Act Rules 14a-6(i)(1) and 0-11.

LOGO

John M. Timken, Jr.

Chairman – Board of Directors

The Timken Company

4500 Mt. Pleasant Street NW

North Canton, OH 44720

LOGO

March 18, 2022

Dear Fellow Timken Shareholder:

Your Board of Directors is pleased to invite you to the 2022 Annual Meeting of Shareholders of The Timken Company to be held on Friday, May 6, 2022, at 10:00 a.m. local time. We will conduct this year’s meeting in an online-only format, with attendance via the internet, due to the ongoing pandemic.

This year, you are being asked to act upon four matters. Three of these matters (Proposals No. 1-3) have been unanimously recommended by your Board of Directors, while one of these matters (Proposal No. 4) is a shareholder proposal that is not supported by your Board of Directors. Details of these matters, along with the recommendations of your Board of Directors, are contained in the accompanying Notice of 2022 Annual Meeting of Shareholders and Proxy Statement.

Please read the enclosed information carefully before voting your shares. Voting your shares as soon as possible will ensure your representation at the meeting, whether or not you plan to attend.

I want to thank you for your continuous support of our business over the years and I look forward to strong participation and a similar vote of support at the 2022 Annual Meeting of Shareholders.

Sincerely,

LOGO

John M. Timken, Jr.

Chairman – Board of Directors

Engineered Bearings I Mechanical Power Transmission Products I Industrial Services

THE TIMKEN COMPANY

North Canton, Ohio

NOTICE OF 2022 ANNUAL MEETING OF SHAREHOLDERS

The 2022 Annual Meeting of Shareholders of The Timken Company will be held on Friday, May 6, 2022, at 10:00 a.m. local time, in an online-only format, with attendance via the internet at the following web address: www.cesonlineservices.com/tkr22_vm. You will not be able to attend this meeting in person due to the ongoing pandemic.

The meeting is being held for the following purposes:

1. Election of 12 Directors to serve for a term of one year;

2. Approval, on an advisory basis, of our named executive officer compensation;

3. Ratification of the appointment of Ernst & Young LLP as our independent auditor for the fiscal year ending December 31, 2022;

4. Consideration of a shareholder proposal requesting that our Board take each step necessary so that each voting requirement in our charter and bylaws (that is explicit or implicit due to default to state law) that calls for a greater than simple majority vote be eliminated, and replaced by a requirement for a majority of the votes cast for and against applicable proposals, or a simple majority in compliance with applicable laws; and

5. Consideration of such other business as may properly come before the meeting.

Shareholders of record of common shares of The Timken Company at the close of business on February 22, 2022 are the shareholders entitled to notice of and to vote at the meeting.

YOUR VOTE IS IMPORTANT. WHETHER OR NOT YOU PLAN TO PARTICIPATE IN THE ONLINE-ONLY 2022 ANNUAL MEETING OF SHAREHOLDERS, PLEASE SIGN AND DATE THE ENCLOSED PROXY CARD AND RETURN IT IN THE POSTAGE-PAID ENVELOPE PROVIDED OR VOTE YOUR SHARES ELECTRONICALLY THROUGH THE INTERNET OR BY TELEPHONE. VOTING INSTRUCTIONS ARE PROVIDED ON THE ENCLOSED PROXY CARD.

Effect of Not Casting Your Vote. Under New York Stock Exchange rules, if you hold your shares in “street name” through a brokerage account, your broker will NOT be able to vote your shares for you on most of the matters being considered at the 2022 Annual Meeting of Shareholders, including the election of Directors, unless you have given instructions to your broker prior to the meeting.

In order to attend the online-only meeting, you will need to pre-register by 10:00 a.m. Eastern Time on May 5, 2022. To pre-register for the meeting, please follow these instructions:

Registered Shareholders

If your shares are registered in your name with our transfer agent or you are a participant holding shares in a Timken-sponsored employee savings plan and you wish to attend the virtual meeting, go to www.cesonlineservices.com/tkr22_vm. Please have your Proxy Card or Notice of the Meeting, containing your 11-digit control number available and follow the instructions to complete your registration request.

Beneficial Shareholders (those holding shares through a stock brokerage account or by a bank or other holder of record)

Beneficial shareholders who wish to attend the virtual meeting may pre-register by visiting the website www.cesonlineservices.com/tkr22_vm. Please have available the voting instruction form, notice, or other communication from your broker, bank, or other holder of record that sets forth the control number provided to you and follow the instructions to complete your registration request.

After pre-registering for the meeting, shareholders will receive a confirmation email with a link and instructions for accessing the virtual Annual Meeting and submitting questions. Shareholders may review the rules of conduct for the virtual meeting or vote during the virtual Annual Meeting by following the instructions available on the meeting website.

Thank you for your continued support of The Timken Company.


		Hansal N. Patel
		Vice President, General Counsel & Secretary

March 18, 2022

Important Notice Regarding the Availability of Proxy Materials for the 2022 Annual Meeting of Shareholders to be held on May 6, 2022: This Proxy Statement and our 2021 Annual Report to Shareholders are available on the Investors section of our website https://investors.timken.com/.

TABLE OF CONTENTS



Notice of 2022 Annual Meeting of Shareholders and Proxy Statement

		Chairman’s Letter

		Notice of Annual Meeting

		Table of Contents

1		Proxy Summary

11		Proxy Statement

11		Proposal No. 1: Election of Directors

12		Nominees

18		Independence Determinations

18		Related Party Transactions Approval Policy

19		Board and Committee Meetings

19		Board Leadership Structure

19		Director Compensation

22		Board Committees

22		Audit Committee

22		Compensation Committee

24		Nominating and Corporate Governance Committee

25		Corporate Governance and Social Responsibility Highlights

29		Shareholder Engagement in 2021

29		Risk Oversight

30		Shareholder Communications

30		Beneficial Ownership of Common Shares

33		Proposal No. 2: Approval, on an Advisory Basis, of Our Named Executive Officer Compensation



34		Compensation Discussion and Analysis

58		Executive Compensation

73		CEO Pay Ratio

74		Proposal No. 3: Ratification of Appointment of Independent Auditor

75		Auditor

75		Audit Committee Report

76		Proposal No. 4: Shareholder Proposal – Simple Majority Vote

79		Other Information

79		Participation at the Annual Meeting

79		Proxy Solicitation

79		How Proxies Will be Voted

79		Voting at the Meeting

80		Submission of Shareholder Proposals

80		General

A-1		Appendix A

PROXY SUMMARY

This summary highlights certain information contained in the Proxy Statement. This summary does not contain all of the information that you should consider, and you should read the entire Proxy Statement before voting.

2022 Annual Meeting of Shareholders


Date and Time:		Friday, May 6, 2022, at 10:00 a.m. local time

Location:		Online-only format, with attendance via the internet at the following web address: www.cesonlineservices.com/tkr22_vm

Record Date:		February 22, 2022

Mail Date:		The approximate date our Proxy Statement and proxy card will be first sent or given to our shareholders is March 18, 2022.

Voting Matters and Board Voting Recommendations


Board Recommends	Proposal	See Page

For	1. Election of 12 Directors to serve for a term of one year.	11

For	2. Approval, on an advisory basis, of our named executive officer compensation.	33

For	3. Ratification of the appointment of Ernst & Young LLP as our independent auditor for the fiscal year ending December 31, 2022.	74

Against	4. A shareholder proposal requesting that our Board take each step necessary so that each voting requirement in our charter and bylaws (that is explicit or implicit due to default to state law) that calls for a greater than simple majority vote be eliminated, and replaced by a requirement for a majority of the votes cast for and against applicable proposals, or a simple majority in compliance with applicable laws.	76

LOGO

Director Nominees

See Proposal No. 1 on page 11 of the Proxy Statement for more details on the 12 nominees for Director. The following information describes relevant information about each nominee as of March 1, 2022.

Committee Memberships

Name and Title

Age

Director

since

Independent

Audit

Compensation

Nominating &

Corporate

Governance

Other

Public

Boards

Maria A. Crowe

Retired President of Manufacturing

Operations, Eli Lilly and Company

2014

✓

Chair

–

Elizabeth A. Harrell

Retired Major General, U.S. Air

Force

2017

✓

–

Richard G. Kyle

President and Chief Executive

Officer, The Timken Company

2013

Sarah C. Lauber

Chief Financial Officer & Secretary,

Douglas Dynamics, Inc.

2021

✓

–

John A. Luke, Jr.

Retired Chairman, WestRock

Company; Retired President and

CEO MeadWestvaco Corporation

1999

✓

–

Christopher L. Mapes

Chairman, President and Chief

Executive Officer, Lincoln Electric

Holdings, Inc.

2014

✓

James F. Palmer

Retired Corporate Vice President

and Chief Financial Officer,

Northrop Grumman Corporation

2015

✓

Chair

✓

–

Ajita G. Rajendra

Retired Executive Chairman,

President and CEO

A. O. Smith Corporation

2014

✓

Chair

Frank C. Sullivan

Chairman and Chief Executive

Officer, RPM International Inc.

2003

✓

John M. Timken, Jr.

Chairman, Board of Directors, The

Timken Company

1986

✓

Independent
Chairman

–

Ward J. Timken, Jr.

Chief Executive Officer, McKinley

Strategies, LLC

2002

–

Jacqueline F. Woods

Retired President, AT&T Ohio

2000

✓

–

Average Age / Median Tenure

8.5 years

Board Composition Overview

Gender and Ethnic Diversity

Oversight

Independence

Refreshment

LOGO

Three Audit

Committee

Financial Experts

LOGO

Over

Half

of our Board

refreshed within

the last decade

Representative Skills and Attributes of the Board


		LEADERSHIP AND GOVERNANCE Senior leadership experience at a large organization, including current or former service as a public company officer (CEO, CFO, etc.) or military general, or other public company board service leading to valuable insight on corporate governance matters

		HUMAN CAPITAL MANAGEMENT Expertise in talent management, public company compensation structures, key employee development and retention, and executive succession planning

		FINANCIAL REPORTING AND CAPITAL ALLOCATION Experience in the finance function of an enterprise, including an in-depth understanding of financial management, financial reporting and capital allocation processes

		MANUFACTURING AND ENVIRONMENTAL MANAGEMENT Expertise in manufacturing operations and logistics and environmental management to drive operating performance through sustainable means

LOGO


		RISK MANAGEMENT Experience with risk management and compliance oversight relevant to the exercise of fiduciary responsibilities				STRATEGY AND M&A Responsibility for driving growth through innovative strategic initiatives and through acquisitions and other business combinations

		GOVERNMENTAL AND REGULATORY AFFAIRS Insight into managing governmental and regulatory affairs relevant to the Company’s business operations				MARKETING AND SALES Expertise in marketing, sales, and customer service at a scale relevant to the Company’s global business

		GLOBAL OPERATIONS Service in a leadership role with multinational companies or in global markets, leading to a deep knowledge of global industry dynamics and international supply chain management

Corporate Governance Highlights

The Timken Company is committed to strong corporate governance as evidenced by the following practices. See page 25 of the Proxy Statement for more details.



Board Independence		✓ 10 of 12 Director nominees are independent ✓ Independent Chair of the Board

Director Elections		✓ Commitment to Board refreshment and diversity – 7 new Directors (representing over half of our Board) added in the past decade ✓ All standing committee members are independent ✓ Declassified Board with annual Board elections ✓ Directors are elected by a majority of votes cast, and our Majority Voting Policy requires any Director who fails to receive a majority of the votes cast in favor of his or her election to submit his or her resignation to the Board

Board Practices		✓ Stock ownership requirements for nonemployee Directors (5x cash retainer) ✓ At each Board meeting, the independent Directors have the opportunity to conduct executive sessions ✓ Annual Board, committee and Director evaluations ✓ Over-boarding policy limits the number of public company boards a Director can serve on

Shareholder Rights		✓ Shareholder proxy access with 3/3/20/20 parameters ✓ Special meetings may be called by shareholders holding 25% of the Company’s common shares

Other Best Practices		✓ Annual advisory vote on our named executive officer compensation ✓ 5 of 12 Directors are ethnically or gender diverse ✓ Code of Conduct for Directors, officers and employees ✓ Strong focus on shareholder engagement – over 400 interactions with investors in 2021 ✓ 3 Audit Committee financial experts ✓ Audit Committee or Board receives reports on cyber security threats and trends at least annually and receives regular updates on our information security program ✓ Nominating and Corporate Governance Committee provides oversight for Corporate Social Responsibility (“CSR”) program

Corporate Social Responsibility

In 2021, CSR remained a priority for Timken as we published our most recent CSR report. In consideration of our efforts, we were named one of the World’s Most Ethical Companies^® by Ethisphere^® Institute for the eleventh time, among America’s Most Responsible Companies by Newsweek and Statista and one of America’s Best Employers, America’s Best Employers for New Graduates and America’s Best Employers for Women by Forbes.

For more information regarding our corporate social responsibility program, please see page 25 of the Proxy Statement or our most recent corporate social responsibility report available on our website at https://www.timken.com/corporate-social-responsibility/.

LOGO

Additional awards in 2021:

●

One of the World’s Most Ethical Companies® by Ethisphere® Institute for the eleventh time

●

One of America’s Best Employers by Forbes

●

One of America’s Best Employers for New Graduates by Forbes

●

One of America’s Best Employers for Women by Forbes

2021 Performance Highlights

Timken delivered record-setting performance in 2021, despite the unprecedented supply chain challenges and inflationary pressures that accelerated during the year. The Company grew revenue and earnings significantly in 2021, with record revenue of $4.13 billion, an increase of approximately 18% from 2020, net income increasing approximately 30% to $369 million and adjusted earnings before interest, taxes, depreciation, and amortization (“EBITDA”) increasing approximately 9% to $718 million¹. We achieved record earnings per diluted share (“EPS”) of $4.79 and record adjusted EPS of $4.72¹, up 29% and 15%, respectively, from 2020. We also delivered an adjusted return on invested capital (“ROIC”) of 11.0%¹ in 2021, up from 9.9% last year. In addition, we generated net cash from operations of $387 million and free cash flow of $239¹ million in 2021.

We achieved these results through the continued execution of our corporate strategy, which is delivering improved performance and higher returns through the business cycle. Our strategy focuses on (1) driving organic growth and share gains in our core business by leading in product technology, innovation and service, (2) executing operational excellence initiatives across the enterprise to enhance performance, and (3) deploying capital to drive optimal returns for our investors.

We have continued to create significant shareholder value by delivering total shareholder returns (“TSR”) of 25.5%, 14.3%, and 12.1% over the past three-, five-, and ten-year periods, respectively. Our three-year and five-year TSR outpaced the median of our 2021 compensation peer group and also exceeded the S&P 500 Industrials over these respective timeframes, while our ten-year TSR was just slightly below our peer median and the S&P 500 Industrials. The S&P 500 Industrials comprises those companies included in the S&P 500 index that are classified as members of the Global Industry Classification Standard (“GICS”) industrials sector.

In 2021, we deployed capital in a disciplined and balanced manner to strengthen our competitive position, create value for our shareholders and further enhance our financial position. We allocated $148 million, or about 3.6% of our sales, to capital expenditures focused on growth and continuous improvement initiatives. We also paid out our 398th consecutive quarterly dividend, continuing one of the longest continuous dividend streaks on the New York Stock Exchange (the “NYSE”) and increased our quarterly dividend to $0.30/share in the second quarter, making 2021 the eighth consecutive year of higher annual dividends. In addition, we repurchased approximately 1.25 million shares of stock, or over 1.7% of our outstanding shares.

2021 also marked the release of our third annual CSR report, which detailed our vision to build a more efficient and resilient world. The report highlights how we continue to advance our corporate social responsibility initiatives by promoting a culture of problem solvers with a strong focus on sustainable products and practices across the Company, while maintaining a strong commitment to ethics.

See page 35 of the Proxy Statement for more details on the Company’s 2021 performance.

¹ See Appendix A for reconciliations of adjusted EPS, adjusted EBITDA, free cash flow, and adjusted ROIC to their most directly comparable GAAP financial measures. Free cash flow is defined as net cash from operations minus capital expenditures. Adjusted ROIC is defined as adjusted net operating profit after taxes (“ANOPAT”) divided by average invested capital. The performance metrics discussed above are used for external reporting and may not correlate exactly to their corresponding compensation adjusted metrics due to slight differences in methodology (see pages 48 to 52 for more details on how the compensation adjusted metrics are calculated).

Return to Shareholders

LOGO

*TSR for the Company was calculated on an annualized basis and assumes quarterly reinvestment of dividends. The 10-year period takes into account the value of TimkenSteel Corporation (“TimkenSteel”) common shares distributed in the spinoff of TimkenSteel from the Company, which was completed on June 30, 2014 (the “Spinoff”).

**See page 43 of the Proxy Statement for the companies that are included in the compensation peer group for 2021.

***The S&P 500 Industrials comprises those companies included in the S&P 500 index that are classified as members of the GICS industrials sector.

2021 Executive Compensation Practices

We design our executive compensation plans and program to help us attract, motivate, reward and retain highly qualified executives who are capable of creating and sustaining value for our shareholders over the long term. See page 35 of the Proxy Statement for more details.


Objectives		Philosophy

Our executive compensation program is designed to: ● Align the interests of our executives and shareholders ● Reward sustained, strong business results ● Incentivize profitable growth and capital deployment discipline ● Attract, retain and motivate the best talent		Our executive compensation philosophy is built on the following principles: ● Recognizing that people are our most important resource ● Rewarding results linked to both short- and long-term performance (pay-for-performance) ● Positioning our pay to be competitive in the marketplace ● Focusing on increasing shareholder value


	What We Do		What We Do Not Do
✓	We utilize stock ownership requirements for executives (5x base salary for CEO and 2x-3x for the other named executive officers)	X	We do not re-price outstanding stock options

✓	We have “clawback” provisions that permit the recovery of executive compensation if an executive engages in conduct that is detrimental to the Company and results in restatement of financial results	X	We do not provide excise tax gross-ups on perquisites or under named executive officer severance agreements

✓	We use shareholder-approved plans to provide short-term and long-term incentives	X	We do not allow hedging or pledging of our shares

✓	We use different metrics for short-term and long-term incentive plans that are designed to align pay with performance	X	We do not have single-trigger vesting

✓	We provide very limited perquisites	X	We do not have employment agreements for our named executive officers

Pay-for-Performance

Our compensation program is designed to link pay and performance, which we believe has been demonstrated by the strong level of shareholder support we have received for our named executive officer compensation program through our annual “say-on-pay” vote over the last few years (as depicted below). A significant portion of the compensation of our named executive officers is equity based, which we believe aligns our executives’ interests with the interests of our shareholders.

LOGO

The Company’s compensation program for executives is designed to link compensation with key financial and operational goals, some of which are short-term, while others take several years or more to achieve. The Company uses a balance of short-term and long-term incentives, as well as cash and non-cash compensation, to meet these objectives:

LOGO

Our incentive compensation program payouts for performance periods ending in 2021 reflect good performance relative to a challenging cost and supply situation:

●

There was a 74.4% payout under the annual cash incentive plan, which reflected below-target performance for 2021, due primarily to lower than targeted free cash flow (driven mainly by higher working capital) and slightly lower earnings and operating margins as compared to target (driven mainly by higher operating costs to serve customers); and

●

There was a 92.7% payout for 2019-2021 performance-based restricted stock units, which reflected strong overall performance in a challenging environment, as the targets were set in early 2019, prior to the start of the COVID-19 pandemic. We achieved record adjusted EPS results in 2019 and 2021, and strong average adjusted ROIC performance over the period.

●

Despite the significant unforeseen impact of COVID-19, no adjustments or modifications were made to the financial performance metrics or targets for our 2019-2021 performance-based RSU cycle, which in part led to the below-target payout.

LOGO

See pages 47 to 52 of the Proxy Statement for more details on the 2021 annual cash incentive plan and the 2019-2021 performance-based restricted stock units.

THE TIMKEN COMPANY

PROXY STATEMENT

The enclosed proxy is solicited by the Board of Directors (also referred to as the “Board”) of The Timken Company, an Ohio corporation (the “Company,” “Timken,” “we,” or “us”), in connection with the 2022 Annual Meeting of Shareholders to be held on Friday, May 6, 2022, at 10:00 a.m. local time in an online-only format, with attendance via the internet, and at any adjournments and postponements thereof, for the purpose of considering and acting upon the matters specified in the foregoing Notice.

The approximate date this Proxy Statement and proxy card will be first sent or given to our shareholders is March 18, 2022.

Instructions for attending the online-only meeting are available in the accompanying Notice of 2022 Annual Meeting of Shareholders and under the section titled “Participation at the Annual Meeting” on page 79.

The Board of Directors is not aware of matters other than those specified in the foregoing Notice that will be brought before the meeting for action. However, if any such matters should be properly brought before the meeting, the persons appointed as proxies may vote or act upon such matters according to their judgment.

PROPOSAL NO. 1: ELECTION OF DIRECTORS

We currently have 12 Directors. Pursuant to our Amended Regulations, all nominees for Director will stand for election for a one-year term to expire at the 2023 Annual Meeting of Shareholders. Candidates for Director receiving the greatest number of votes will be elected. Abstentions and “broker non-votes” (where a broker, other record holder, or nominee indicates on a proxy card that it does not have authority to vote certain shares on a particular matter) will not be counted in the election of Directors and will not have any effect on the result of the vote.

Pursuant to the Majority Voting Policy of the Board of Directors, any Director who fails to receive a majority of the votes cast in his or her election will submit his or her resignation to the Board of Directors promptly after the certification of the election results. The Board of Directors and the Nominating and Corporate Governance Committee will then consider the resignation in light of any factors they consider appropriate, including the Director’s qualifications and service record, as well as any reasons given by shareholders as to why they withheld votes from the Director. The Board of Directors is required to determine whether to accept or reject the tendered resignation within 90 days following the election and to disclose on a Current Report on Form 8-K its decision, as well as the reasons for rejecting any tendered resignation, if applicable.

At its meeting on February 11, 2022, the Board approved a resolution, based on the recommendation of the Nominating and Corporate Governance Committee, nominating the 12 individuals set forth below to be elected Directors at the 2022 Annual Meeting of Shareholders to serve for a term of one year expiring at the 2023 Annual Meeting of Shareholders (or until their respective successors are elected and qualified). Each of the nominees previously was elected as a Director by our shareholders and each has consented to serve as a Director if elected.

If any nominee becomes unable, for any reason, to serve as a Director, or should a vacancy occur before the election (which events are not anticipated), the Directors then in office may substitute another person as a nominee or may reduce the number of nominees as they deem advisable. Unless otherwise indicated on any proxy card, the persons named as proxies on the enclosed proxy card intend to vote the shares covered by such proxy card in favor of the nominees below.

THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE FOR EACH OF THE NOMINEES BELOW.

Nominees

The following information, obtained in part from the respective nominee and in part from our records, describes the background and select experience of each nominee as of March 1, 2022:

LOGO

Business Experience

Ms. Crowe served as President of Manufacturing Operations for Eli Lilly and Company, a global manufacturer of pharmaceutical products, a position she held from 2012 until her retirement in December 2017. Ms. Crowe joined Eli Lilly and Company in 1982, and previously served as its Senior Vice President of Global Drug Products from 2009 to 2012.

Qualifications

Ms. Crowe provides the Board with extensive experience in manufacturing, sourcing and procurement for a global manufacturing company. Ms. Crowe also brings valuable experience on production capacity expansion and innovation efforts.

Maria A. Crowe

Age: 62

Director since 2014

Committees:

· Compensation

· Nominating and Corporate Governance (Chair)

LOGO

Business Experience

Ms. Harrell retired as a Major General in October 2006, serving more than 30 years with the U.S. Air Force. During her military career, she held a wide range of positions in the United States, Germany and South Korea, specializing in aircraft fleet maintenance and sustainment. After her retirement from the U.S. Air Force, Ms. Harrell was a consultant with The Spectrum Group until 2009 and a consultant to Northrop Grumman Corporation, a global security company and a provider of products, systems and solutions in the fields of aerospace, electronics, information systems, and technical services, until 2012.

Qualifications

Ms. Harrell’s extensive knowledge of aerospace technology, global supply chain management and government relations align with the Company’s growth priorities and are valuable to her service as a member of the Board.

Elizabeth A. Harrell

Age: 68

Director since 2017

Committees:

· Compensation

· Nominating and Corporate Governance

LOGO

Richard G. Kyle

Age: 56

Director since 2013

Business Experience

Mr. Kyle was appointed President and Chief Executive Officer of The Timken Company in 2014. Mr. Kyle joined the Company in 2006 and has served in multiple leadership roles of increasing responsibility during his tenure with the Company.

Since 2015, Mr. Kyle has served as a director of Sonoco Products Company, a global provider of consumer packaging, industrial products, protective solutions, and display and packaging services, and as a member of its Audit, Executive Compensation and Governance and Nominating Committees.

Qualifications

Mr. Kyle has significant experience with global manufacturing organizations and has demonstrated the ability to lead change and growth. In addition to his role as Chief Executive Officer of the Company, Mr. Kyle’s strong engineering and operational background, coupled with his strategic perspective, provide valued skills to the Board.

LOGO

Business Experience

Ms. Lauber is Chief Financial Officer & Secretary of Douglas Dynamics, Inc., a premier manufacturer and upfitter of work truck attachments and equipment, a position she has held since August 2017. Prior to joining Douglas Dynamics, Inc., she served as the Senior Vice President and Chief Financial Officer of Jason Industries Inc., a diversified industrial company, from 2015 to 2017. Ms. Lauber has over 25 years of professional experience in various finance and strategic functions and began her career as an accountant at KPMG.

Qualifications

Ms. Lauber’s expertise leading the finance and accounting function of multiple publicly traded manufacturing companies and her experience with financial planning and acquisition integration makes her well-suited to serve on our Board.

Sarah C. Lauber

Age: 50

Director since 2021

Committees:

· Audit

· Compensation

LOGO

Business Experience

Mr. Luke served as the Chairman and Chief Executive Officer of MeadWestvaco Corporation (“MWV”), a leading global producer of packaging and specialty chemicals, from the merger of Mead and Westvaco in 2002 until his retirement in 2015. Mr. Luke served as a director of WestRock Company from 2015 until 2022 when he retired as its Non-Executive Chairman. Mr. Luke previously served as a director of The Bank of New York Mellon Corporation from 2007 to 2018 and Dominion Midstream GP, LLC from 2017 to 2018.

Qualifications

Mr. Luke brings deep executive leadership experience to our Board, including expertise in leading large corporate transformations and evaluating and executing inorganic growth opportunities. Mr. Luke brings perspective gained from serving on several corporate boards.

John A. Luke, Jr.

Age: 73

Director since 1999

Committees:

· Compensation

· Nominating and Corporate Governance

LOGO

Business Experience

Mr. Mapes is Chairman, President and Chief Executive Officer of Lincoln Electric Holdings, Inc., a global manufacturer of welding, cutting and joining products. He has held the position of Chairman since December 2013 and has been President and Chief Executive Officer since December 2012, after serving as Chief Operating Officer beginning in 2011. Mr. Mapes has been a director of Lincoln Electric Holdings, Inc. since 2010.

Qualifications

As a seasoned executive with extensive experience leading global manufacturing and distribution companies, Mr. Mapes understands the challenges of global growth and the complexity of managing international operations. In addition to his business management experience, Mr. Mapes has a law degree.

Christopher L. Mapes

Age: 60

Director since 2014

Committees:

· Audit

· Nominating and Corporate Governance

LOGO

Business Experience

Mr. Palmer served as the Corporate Vice President and Chief Financial Officer of Northrop Grumman Corporation, a global security company and a provider of products, systems and solutions in the fields of aerospace, electronics, information systems and technical services, from March 2007 until February 2015 and as a Corporate Vice President of Northrop Grumman until his retirement in July 2015.

Qualifications

Mr. Palmer’s broad executive background in the aerospace and defense industry, his service as the chief financial officer of multiple large publicly traded companies, and his extensive experience with business acquisitions, debt financings and other complex transactions make him well qualified to serve as a member of the Board.

James F. Palmer

Age: 72

Director since 2015

Committees:

· Audit (Chair)

· Compensation

LOGO

Business Experience

Mr. Rajendra served as Executive Chairman of A. O. Smith Corporation, a global water technology company and manufacturer of residential and commercial water heating and water purification equipment, from September 2018 until his retirement on May 1, 2020. He had held the position of Chairman since 2014 and was President and Chief Executive Officer from 2013 until 2018.

Qualifications

Mr. Rajendra has been a director of A. O. Smith Corporation since 2011 and has been a director of Donaldson Company, Inc. since 2010, where he is a member of the Corporate Governance Committee and Human Resources Committee. Mr. Rajendra’s extensive manufacturing and international experience leading businesses and negotiating acquisitions and joint ventures, along with his experience as a director of other publicly traded companies, provides valuable skills to the Board.

Ajita G. Rajendra

Age: 70

Director since 2014

Committees:

· Audit

· Compensation (Chair)

LOGO

Business Experience

Mr. Sullivan has held the position of Chairman and Chief Executive Officer of RPM International Inc. (“RPM”), a world leader in specialty coatings, since 2008. Mr. Sullivan was appointed RPM’s Chief Executive Officer in 2002, prior to which he held the position of Chief Financial Officer since 1993. Mr. Sullivan has been a director of RPM since 1995 and chairs RPM’s Executive Committee.

Qualifications

Mr. Sullivan provides the Board with extensive financial expertise based on his years as a chief financial officer. In addition, as a chief executive officer and director of a multinational company, Mr. Sullivan brings invaluable executive experience on a wide array of issues, including strategic planning and the evaluation and execution of acquisition opportunities.

Frank C. Sullivan

Age: 61

Director since 2003

Committees:

· Audit

· Nominating and Corporate Governance

LOGO

Business Experience

Mr. Timken is a private investor and a successful entrepreneur, who has been a significant shareholder of the Company for many years. Mr. Timken is co-founder of Amgraph Packaging, a national supplier of flexible package printing used by major food and beverage brands and private labels. His entrepreneurial activities and passion for business-building have included involvement in ventures ranging from injection molding, to ophthalmic laboratories, to logistics and trucking. He also has owned a cable television business and established one of the largest commercial mushroom farms in North America.

Qualifications

Mr. Timken’s ability as an investor to identify and help increase value across a range of industries, as well as his familiarity with the Company’s businesses, provides the Board with critical input in evaluating and making capital allocation decisions. Since joining the Board, he has played an important role in the Company’s strategic drive to add product lines that complement its bearing product portfolio.

John M. Timken, Jr.

Age: 70

Director since 1986

Independent Chairman of the Board


Ward J. Timken, Jr. Age: 54 Director since 2002		Business Experience Mr. Timken co-founded McKinley Strategies, LLC, a political consulting firm, and has served as its Chief Executive Officer since January 2020. Prior to that, Mr. Timken served as Chairman, Chief Executive Officer and President of TimkenSteel, a leader in customized alloy steel products and services, from 2014 to 2019. TimkenSteel was previously a subsidiary of the Company that became an independent public company pursuant to a spinoff in 2014. Mr. Timken previously served as Executive Chairman of the Board of The Timken Company from 2005 to May 2014. Qualifications Mr. Timken provides the Board with relevant experience from having served in key leadership positions during his tenure with the Company. Mr. Timken’s broad-based experience and familiarity with our businesses, along with his understanding of the global industry dynamics across the Company’s markets, enable Mr. Timken to provide valuable input to the Board.


Jacqueline F. Woods Age: 74 Director since 2000 Committees: · Compensation · Nominating and Corporate Governance		Business Experience Ms. Woods served as the President of Ameritech Ohio (subsequently renamed AT&T Ohio), a telecommunications company, until her retirement in 2000. At Ameritech Ohio, Ms. Woods also held various positions in finance, operations, marketing, sales and government affairs. Ms. Woods was inducted into the Ohio Women’s Hall of Fame in 1998. Ms. Woods served on the board of The Andersons, Inc. from 1999 to 2020. Qualifications Ms. Woods’ extensive executive management experience enables her to help guide the Board in making decisions in areas such as marketing, strategy development, corporate governance and compensation. In addition, her executive experience at a primarily consumer-oriented company provides a valuable perspective on customer service. Ms. Woods also brings perspective gained from her service as a member of other public company boards.

Independence Determinations

The Board of Directors has adopted the NYSE independence standards for determining the independence of our Directors. The Board has also adopted standards for categorically immaterial relationships to assist the Board in determining the independence of each Director. These standards include, but are not limited to:

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if the Director is, or has an immediate family member who is, a partner, principal or member (or any comparable position) of, an executive officer or employee of, or a director of, any organization to which Timken made, or from which Timken received, immaterial payments for property or services in the current or any of the past three fiscal years;

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if the Director, or an immediate family member of the Director, serves as an officer, director or trustee of a foundation, university, charitable or other not-for-profit organization, and Timken’s discretionary charitable contributions to the organization are immaterial, in the aggregate; or

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if the Director serves on the board of directors of another company at which another Timken Director or executive officer also serves as a director.

A complete list and description of the categorically immaterial relationships is set forth in Appendix B to the Board of Directors General Policies and Procedures, which is available on the Corporate Governance Section of our website at https://investors.timken.com/corporate-governance/documents/.

The Board has determined that the following Director nominees meet these independence standards: Maria A. Crowe, Elizabeth A. Harrell, Sarah C. Lauber, John A. Luke, Jr., Christopher L. Mapes, James F. Palmer, Ajita G. Rajendra, Frank C. Sullivan, John M. Timken, Jr., and Jacqueline F. Woods. With respect to John M. Timken, Jr., the Board determined that his family relationship to Ward J. Timken, Jr. does not impair his independence.

10/12

members of our Board are independent

Related Party Transactions Approval Policy

Our Directors and executive officers are subject to our Standards of Business Ethics, which require that any potential conflicts of interest involving our Directors or executive officers, such as significant transactions with related parties, be reported to our Vice President, General Counsel & Secretary. Our Directors and executive officers also are subject to the Timken Policy Against Conflicts of Interest, which requires that an employee or Director avoid placing himself or herself in a position in which his or her personal interests could interfere, or appear to interfere, with our interests. While not every situation can be identified in a written policy, the Timken Policy Against Conflicts of Interest identifies the following situations as examples that may constitute a prohibited conflict of interest:

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competing against the Company;

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holding a significant financial interest in a company doing business with or competing with the Company;

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accepting gifts, gratuities or entertainment from any customer, competitor or supplier of goods or services to the Company, except to the extent they are customary and reasonable in amount and not in consideration for an improper action by the recipient;

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using for personal gain any business opportunities that are identified through a person’s position with the Company;

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using the Company’s property, information or position for personal gain;

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using the Company’s property other than in connection with our business;

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maintaining other employment or a business that adversely affects a person’s job performance at the Company; and

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doing business on the Company’s behalf with a relative or another company employing or owned by a relative.

In the event of any potential conflict of interest, pursuant to the charter of the Nominating and Corporate Governance Committee, the Standards of Business Ethics and the Timken Policy Against Conflicts of Interest, the Nominating and Corporate Governance Committee would review, determine whether or not a conflict of interest exists and, if appropriate after considering such factors as it deems appropriate under the circumstances, grant a waiver or specify any mitigation actions to address the potential conflict. Waivers involving our Directors or executive officers will be promptly disclosed to shareholders in a manner consistent with applicable laws or regulations and in accordance with our applicable policies. Additionally, the Nominating and Corporate Governance Committee would review and approve or ratify any transaction required to be publicly reported to shareholders pursuant to Item 404(a) of Regulation S-K of the Securities and Exchange Act of 1934, as amended (the “1934 Act”), with such review to occur regardless of whether the materiality threshold of that provision is met.

Board and Committee Meetings

The Board of Directors has an Audit Committee, a Compensation Committee, and a Nominating and Corporate Governance Committee. During 2021, there were seven meetings of the Board of Directors, nine meetings of its Audit Committee, three meetings of its Compensation Committee and three meetings of its Nominating and Corporate Governance Committee. All Directors attended 100% of the meetings of the Board and its committees on which they served. It is our policy that all members of the Board of Directors attend the annual meeting of shareholders and, in 2021, all members attended the meeting. At each regularly scheduled meeting of the Board of Directors, the independent Directors have the opportunity to meet separately in executive session.

Board Leadership Structure

The Board is led by independent Chairman John M. Timken, Jr., who was first elected to this position on May 13, 2014.

The Chairman oversees the planning of the annual Board calendar and, with the CEO and in consultation with the other Directors, schedules and sets the agenda for meetings of the Board and leads the discussions at such meetings and at executive sessions of the independent Directors. The Chairman also leads the Company’s annual meeting of shareholders and performs such other functions and responsibilities as set forth in the Board of Directors General Policies and Procedures or as requested by the Board from time to time.

The Board’s preferred governance structure is to separate the roles of Chair and CEO. Since 2014, the Chair of the Board has been independent. While recognizing that there is no single, generally accepted approach to providing Board leadership and that the Board’s leadership structure may vary in the future as circumstances warrant, the Board considers this balance of leadership between the two positions to be beneficial.

Director Compensation

Directors who are not Timken employees receive an annual retainer fee, annual committee fees (as applicable) and an annual equity award. The independent Chairman and each committee chairperson receive additional retainer fees. Richard G. Kyle, our President and Chief Executive Officer (“CEO”), does not receive any additional compensation for his service as a Director.

Cash Compensation

Each nonemployee Director who served in 2021 was paid an annual retainer fee of $80,000 as base compensation for services as a Director. In addition to base compensation, John M. Timken, Jr. received

an annual fee of $100,000 for his service as the independent Chairman. The following additional annual fees were paid for serving on a committee of the Board in 2021:



Committee	Chairperson Fee	Member Fee
Audit	$30,000	$15,000

Compensation	$17,500	$7,500
Nominating &Corporate Governance	$17,500	$7,500

To the extent a Director served on the Board or any committee of the Board for only part of the year, such Director received a pro-rated portion of the applicable fees based on the amount of time served.

Equity Compensation

Each nonemployee Director serving at the time of our 2021 Annual Meeting of Shareholders on May 7, 2021 received a grant of 1,340 restricted stock units that vest after one year under The Timken Company 2019 Equity and Incentive Compensation Plan (the “Equity and Incentive Compensation Plan”). Upon a non-employee Director’s initial election to the Board, each such Director receives a grant of 2,000 restricted stock units under the Equity and Incentive Compensation Plan that vest one-fifth annually from the date of grant. Sarah C. Lauber received such a grant during 2021. Cumulative dividend equivalents are paid in cash upon vesting.

Holding Requirement

The Compensation Committee of the Board of Directors has adopted stock ownership requirements for nonemployee Directors equal to five times the annual cash retainer of $80,000, or the equivalent of $400,000 worth of common shares. Directors must meet this requirement within five years of becoming a Director of the Company. In determining whether a Director has met his or her individual ownership target, the Company considers shares owned by the Director and full-value equity awards held by the Director, including restricted shares and restricted stock units still subject to vesting conditions. As of December 31, 2021, all our Directors other than Ms. Lauber had met their stock ownership requirements. Ms. Lauber joined the Board in January 2021 and she is on track to achieve the ownership requirement within the five-year time frame.

Compensation Deferral

Any Director may elect to defer the receipt of all or a specified portion of their cash fees or their annual equity award until a specified point in the future in accordance with the provisions of the Director Deferred Compensation Plan, as amended and restated effective January 1, 2015 (the “Director Deferred Compensation Plan”). The cash amounts deferred can be invested in a cash fund or the hypothetical Timken common share fund. The cash fund provides for interest to be earned quarterly at a rate equal to the prime rate plus 1%. If cash fees are invested in the Timken common share fund, Directors may elect to receive cash in an amount equal to any dividend equivalents or reinvest such amounts in the Timken common share fund. Equity award deferrals are maintained in a separate account, which is credited with the number of shares that would otherwise have been issued or transferred and delivered to the Director. Such accounts are credited from time to time with amounts equal to dividends or other distributions paid on the number of shares reflected in such accounts.

2021 Director Compensation Table

The following table provides the compensation and benefits applicable to our nonemployee Directors for 2021:


Name ⁽¹⁾	Fees Earned or Paid in Cash	Stock Awards ⁽²⁾	All Other Compensation ⁽³⁾	Total
Maria A. Crowe	$112,500	$120,319	$3,602	$236,421

Elizabeth A. Harrell	$95,000	$120,319	$4,314	$219,633

Sarah C. Lauber	$100,183	$289,919	-	$390,102

John A. Luke, Jr.	$95,000	$120,319	$3,602	$218,921

Christopher L. Mapes	$102,500	$120,319	$3,602	$226,421

James F. Palmer	$117,500	$120,319	$3,602	$241,421

Ajita G. Rajendra	$112,500	$120,319	$3,602	$236,421

Frank C. Sullivan	$102,500	$120,319	$3,602	$226,421

John M. Timken, Jr.	$180,000	$120,319	$3,602	$303,921

Ward J. Timken, Jr.	$80,000	$120,319	$3,602	$203,921

Jacqueline F. Woods	$95,000	$120,319	$3,602	$218,921

(1)

Richard G. Kyle, our President and CEO, is not included in this table as he is an employee of the Company and receives no compensation for his services as a Director.

(2)

The amount shown for each Director includes the grant date fair value of the award of 1,340 restricted stock units made on May 7, 2021. These restricted stock units vest 100% one year following the grant date. Ms. Harrell elected to defer the award made on May 7, 2021 under the Director Deferred Compensation Plan for distribution in the future. For Ms. Lauber, the amount also includes the grant date fair value of the award of 2,000 restricted stock units made to her on January 8, 2021 in connection with her initial election to the Board, which restricted stock units vest one-fifth annually from the date of grant. The amounts shown in this column are computed in accordance with Financial Accounting Standards Board Accounting Standards Codification (“FASB ASC”) Topic 718.

(3)

All other compensation reflects cash dividend equivalents paid to the Directors in 2021 for unvested restricted stock units granted in the prior year and cash dividends paid to certain Directors for unvested restricted stock granted in connection with their initial election to the Board, in each case upon vesting of such restricted stock units or restricted shares in 2021. Ms. Harrell elected to defer her annual restricted stock unit awards granted in 2021 under the Director Deferred Compensation Plan for distribution in the future. The table above includes cash dividend equivalents in the amount of $3,602 which were also deferred by Ms. Harrell under the Director Deferred Compensation Plan.

As of December 31, 2021, unvested restricted shares and unvested restricted stock units were held by the nonemployee Directors as follows:



Name		Unvested Restricted Shares and Unvested Restricted Stock Units
Maria A. Crowe		1,340
Elizabeth A. Harrell		1,740
Sarah C. Lauber		3,340
John A. Luke, Jr.		1,340
Christopher L. Mapes		1,340
James F. Palmer		1,340
Ajita G. Rajendra		1,340
Frank C. Sullivan		1,340
John M. Timken, Jr.		1,340
Ward J. Timken, Jr. ⁽¹⁾		1,340
Jacqueline F. Woods		1,340

(1)

Additionally, Ward J. Timken, Jr. has 92,000 vested and unexercised stock options earned from his previous role as an employee and executive Chairman of the Board of The Timken Company from 2005 to May 2014.

Board Committees

Audit Committee

We have a standing Audit Committee that has oversight responsibility with respect to our independent auditor and the integrity of our financial statements. The Audit Committee is composed of James F. Palmer (Audit Committee Chair), Maria A. Crowe, Sarah C. Lauber, Christopher L. Mapes, Ajita G. Rajendra and Frank C. Sullivan. Our Board of Directors has determined that each member of the Audit Committee is financially literate and independent as defined in the listing standards of the NYSE and the rules of the Securities and Exchange Commission (the “SEC”). Our Board of Directors has determined that Sarah C. Lauber, James F. Palmer and Frank C. Sullivan qualify as Audit Committee financial experts.

The Audit Committee’s charter is available on the Corporate Governance section of our website at https://investors.timken.com/corporate-governance/documents/.

Compensation Committee

We have a standing Compensation Committee that establishes and administers our policies, programs and procedures for compensating our senior management and Board of Directors. Members of the Compensation Committee are Ajita G. Rajendra (Compensation Committee Chair), Elizabeth A. Harrell, Sarah C. Lauber, John A. Luke, Jr., James F. Palmer and Jacqueline F. Woods. Our Board of Directors has determined that all members of the Compensation Committee are independent as defined in the listing standards of the NYSE.

With the guidance and approval of the Compensation Committee, we have developed compensation programs for our executive officers, including the CEO and the other named executive officers, that are intended to align the interests of our executives and shareholders; reward executive management for sustained, strong business and financial results; and enable us to attract, retain and motivate the best talent. The Compensation Committee determines specific compensation elements for the CEO and considers and acts upon the CEO’s recommendations regarding the other executive officers.

The agenda for meetings of the Compensation Committee is determined by its Chair with the assistance of the General Manager – Compensation. The meetings are regularly attended by the Chairman of the Board, the CEO, the Vice President, General Counsel &

Secretary, and the General Manager – Compensation. At each meeting, the Compensation Committee meets in executive session. The Chair of the Compensation Committee reports the Committee’s actions regarding compensation of executive officers to the full Board and the full Board acts on compensation matters for the CEO. Our Human Resources department supports the Compensation Committee in its duties and may be delegated certain administrative duties in connection with our compensation programs. The Compensation Committee has the sole authority to retain and terminate compensation consultants to assist in the evaluation of Director and executive officer compensation and the sole authority to approve the fees and other retention terms of any compensation consultants. The Compensation Committee has engaged Willis Towers Watson Public Limited Company (“WTW”), a global professional services firm, to conduct annual reviews of its compensation programs for the Company’s executive officers and Directors. WTW also provides information to the Compensation Committee on trends in executive compensation and other market data. WTW (or its predecessor) has provided executive consulting services to the Compensation Committee and other professional consulting services to the Company for over 20 years.

With respect to Director compensation, as stated above, the Compensation Committee annually engages WTW to conduct reviews of Director compensation, and the Committee may then recommend to the full Board changes in Director compensation that will enhance our ability to attract and retain qualified Directors.

During fiscal year 2021, WTW was paid approximately $200,000 for the executive and Director compensation consulting services it provided to the Compensation Committee. Other professional consulting services provided by WTW to the Company, which were requested by management, not approved by the Compensation Committee or the Board and not related to executive compensation, totaled approximately $1.75 million, most of which (greater than $1.6 million) related to retirement consulting and outsourcing of pension administration services.

The Compensation Committee has concluded that the advice it receives from WTW continues to be objective, unbiased and independent. The Compensation Committee’s careful oversight of the relationship with WTW with respect to compensation advice mitigates the risk that management potentially could misuse the actuarial engagement to influence WTW’s compensation work for the Compensation Committee. The Compensation Committee annually reviews the charges to the Company from WTW for executive and Director compensation advice and other services for the preceding three years, along with an estimate of services for the coming year. Additionally, WTW has adopted internal safeguards to ensure that its executive compensation unit is maintained separately from its actuarial business.

The Compensation Committee has assessed the independence of WTW, as required under the listing standards of the NYSE. The Compensation Committee also has considered and assessed relevant factors that could give rise to a potential conflict of interest with respect to WTW, specifically including the six consultant independence factors under Rule 10C-1(b)(4)(i) through (vi) under the 1934 Act. Based on this review, we are not aware of any conflict of interest regarding the work performed by WTW.

The Compensation Committee also plays an active role in our executive officer succession planning process. The Compensation Committee meets regularly with senior management to ensure that an effective succession planning process is in place and to discuss potential successors for executive officers. As part of this process, executive officer position profiles are updated to highlight the key skills required to meet future demands, and potential successors are evaluated and development plans are reviewed. Each year, the Compensation Committee reviews and discusses potential successors for each of the executive officers with the full Board in executive session. In addition, at the end of each year, the Compensation Committee reviews the performance of each of the executive officers. The Compensation Committee is also periodically updated regarding more broad-based human capital focused initiatives such as pay equity studies and, alongside the remainder of the Board, employee engagement surveys.

The Compensation Committee’s charter is available on the Corporate Governance section of our website at https://investors.timken.com/corporate-governance/documents/. For more information regarding the role of management and the compensation consultants in determining or recommending the amount or form of executive compensation,

see “Compensation Discussion and Analysis – Determining Compensation for 2021” on page 44.

Nominating and Corporate Governance Committee

We have a standing Nominating and Corporate Governance Committee that is responsible for, among other things, evaluating new Director candidates and incumbent Directors, recommending Directors to serve as members of our Board committees, and providing oversight of the Company’s CSR program. Members of the Nominating and Corporate Governance Committee are Maria A. Crowe (Nominating and Corporate Governance Committee Chair), Elizabeth A. Harrell, John A. Luke, Jr., Christopher L. Mapes, Frank C. Sullivan and Jacqueline F. Woods. Our Board of Directors has determined that all members of the Nominating and Corporate Governance Committee are independent as defined in the listing standards of the NYSE.

The Board of Directors General Policies and Procedures provide that the general criteria for Director candidates include, but are not limited to, the highest standards of integrity and ethical behavior, the ability to provide wise and informed guidance to management, a willingness to pursue thoughtful, objective inquiry on important issues before the Company and a range of experience and knowledge commensurate with our needs as well as the expectations of knowledgeable investors.

The Nominating and Corporate Governance Committee utilizes a variety of sources to identify possible Director candidates, including search firms, professional associations and Director recommendations. In evaluating candidates to recommend to the Board of Directors, the Nominating and Corporate Governance Committee considers factors consistent with those set forth in the Board of Directors General Policies and Procedures, including whether the candidate enhances the diversity of the Board. Such diversity includes professional background and capabilities, knowledge of specific industries and geographic experience, as well as the more traditional diversity concepts of race, gender and national origin. The attributes of the current Directors and the needs of the Board and the Company are evaluated whenever a Board vacancy occurs, and the effectiveness of the nomination process, including whether that process enhances the Board’s diversity, is evaluated each time a candidate is considered. The Nominating and Corporate Governance Committee also is responsible for reviewing the qualifications of, and making recommendations to the Board of Directors for, Director nominations submitted by our shareholders. All Director nominees are evaluated in the same manner by the Nominating and Corporate Governance Committee, without regard to the source of the nominee recommendation.

The Nominating and Corporate Governance Committee also plans for Director succession. The Committee regularly reviews the size of the Board and whether any vacancies are expected due to retirement, refreshment or otherwise. The Nominating and Corporate Governance Committee seeks to maintain an appropriate mix of newer Directors who bring fresh perspectives with longer-tenured Directors who have deep knowledge of our global operations and long-term strategy. In the event that vacancies are anticipated or otherwise arise, the Committee considers potential Director candidates in accordance with the factors and criteria outlined above.

The Nominating and Corporate Governance Committee’s charter is available on the Corporate Governance section of our website at https://investors.timken.com/corporate-governance/documents/.

Our code of business conduct and ethics, called the “Standards of Business Ethics,” and our corporate governance guidelines, called the “Board of Directors General Policies and Procedures,” are reviewed by the Nominating and Corporate Governance Committee as appropriate and are available on the Corporate Governance section of our website at https://investors.timken.com/corporate-governance/documents/.

Shareholder-Recommended Director Candidates

Director candidates recommended by our shareholders will be considered by the Nominating and Corporate Governance Committee in accordance with the criteria outlined above. In order for a shareholder to submit a recommendation, the shareholder must deliver a communication by registered mail or in person to the Nominating and Corporate Governance Committee, c/o The Timken Company, 4500 Mt. Pleasant Street NW, North Canton, Ohio 44720. Such communication should include the proposed candidate’s qualifications, any relationship between the shareholder and the proposed candidate, and any other information that the shareholder considers useful for the Nominating and Corporate Governance Committee to consider in evaluating such candidate.

Shareholder-Nominated Director Candidates

Our Amended Regulations provide a “proxy access” right to permit any shareholder or a group of up to 20 shareholders owning 3% or more of the voting power entitled to vote in the election of Directors continuously for at least three years to nominate and include in our proxy materials Director nominees for election to the Board. A shareholder or shareholders, as applicable, can nominate up to the greater of (i) 20% of the total number of Directors on the Board, rounding down to the nearest whole number, and (ii) two Directors in accordance with the requirements set forth in our Amended Regulations. Under our Amended Regulations, requests to include shareholder-nominated candidates for Director in our proxy materials must be received no earlier than 150 days and no later than 120 days before the anniversary of the date that we issued our Proxy Statement for the previous year’s annual meeting of shareholders. Requests to include shareholder-nominated candidates for Director in our proxy materials related to the 2023 Annual Meeting of Shareholders must be delivered by certified mail, return receipt requested, to our Vice President, General Counsel & Secretary, c/o The Timken Company, 4500 Mt. Pleasant Street NW, North Canton, Ohio 44720, no earlier than October 19, 2022 and no later than November 18, 2022 in order to be timely. The summary of this “proxy access” right set forth above is qualified in its entirety by our Amended Regulations.

Corporate Governance and Social Responsibility Highlights

The Nominating and Corporate Governance Committee regularly reviews trends and recommends best practices, initiates improvements, and plays a leadership role in maintaining the Company’s strong corporate governance structure and practices. The below table details the practices the Nominating and Corporate Governance Committee believes demonstrate the Company’s commitment to strong corporate governance and additional information about the Company’s corporate governance structure and practices can be found in the Board of Directors General Policies and Procedures, our Amended Regulations and our Amended Articles of Incorporation.

Board Independence, Refreshment, Diversity and Experience

^✓ Strongly independent Board (10 of 12 Director nominees are independent)

^✓ Independent Chairman of the Board

^✓ Commitment to Board refreshment and diversity – 7 new Directors (representing over half of our Board) added in the past decade

^✓ 5 of 12 Directors are ethnically or gender diverse

^✓ 3 Audit Committee financial experts

^✓ 6 current or former public company Chief Executive Officers currently serve on the Board

Shareholder Rights

^✓ Shareholder proxy access with 3/3/20/20 parameters

^✓ Special meetings may be called by shareholders holding 25% of the Company’s common shares

Other Strong Governance Practices

^✓ Declassified Board – all Directors are elected annually

^✓ Annual Board, Committee and Director evaluations

^✓ Majority Voting Policy that requires any Director who fails to receive a majority of the votes cast in favor of his or her election to submit his or her resignation to the Board

^✓ Over-boarding policy limits the number of public company boards a Director can serve on

^✓ “Clawback” provisions permit recovery of executive compensation if an executive engages in conduct that is detrimental to the Company and that results in restatement of financial results

^✓ Stock ownership requirements for Directors and executive officers

^✓ Audit Committee or Board receives reports on cyber security threats and trends at least annually and receives regular updates on our information security program

^✓ Strong focus on shareholder engagement – over 400 interactions with investors in 2021

The Nominating and Corporate Governance Committee also provides oversight of our CSR program, though the full Board of Directors as well as its other standing committees also play a role in advising on certain CSR-related topics such as human capital initiatives and risk oversight.

Oversight and Management of the Company’s CSR Program


		Provides oversight of our CSR program
		Champions our CSR efforts and liaises with the Nominating and Corporate Governance Committee on CSR developments
		Vice President, General Counsel & Secretary, Vice President, Human Resources, and Director – Corporate Communications provide management oversight and leadership to the steering committee
		Cross-functional team charged with monitoring and evaluating current and future CSR initiatives, recommending strategies, managing data collection processes, and reporting on Company progress
		Consists of leaders in operations, compensation and benefits, HR, communications, legal, environmental, supply chain and other key functional areas

In 2021, we continued to expand upon our CSR program and further detailed our efforts to support our stakeholders as a socially responsible corporation. Our CSR program is guided by our core values of ethics and integrity, quality, teamwork and excellence. Our goal is to create real-world impact in three clearly defined areas: the pursuit and expansion of knowledge, sustainability, and leadership. These areas are aligned with our core competencies and focus our efforts towards achieving greater equity and efficiency for a world in motion. Some of the Company’s current initiatives that promote our three focus areas are set forth below:



Focus Area	Knowledge	Sustainability	Leadership
Certain Key Topics	Learning and Development; Diversity and Inclusion; Compensation, Benefits and Wellbeing	Product Stewardship; Energy, Emissions and Waste; Health, Safety and Mitigation	Ethics and Corporate Governance; STEM and Mentorship; Community and Charitable Giving
Initiatives	• Enhancing diversity and inclusion initiatives to encourage global, diverse viewpoints • Deploying comprehensive employee surveys to inform efforts that increase associate engagement and satisfaction • Rewarding associates with strong wages and competitive benefits to recognize professional excellence and career progression • Investing in associate education, training and development programs to support a culture of learning	• Embracing energy efficiency, pollution prevention, waste management and recycling programs at Timken global facilities to reduce our environmental footprint • Engineering innovative products that increase the energy efficiency of machinery and equipment and propel the renewable energy sector • Continuously improving our world-class safety programs to protect associate health and safety, resulting in record performance	• Upholding strong corporate governance principles and practices to promote the interests of the Company and its stakeholders • Leading with and living our values every day, while operating ethically and responsibly in accordance with our Standards of Business Ethics • Building and investing in communities where we live and work through associate and corporate-led giving, partnership and volunteerism • Promoting and protecting recognized human rights in our local communities


		CSR Report Highlights
Knowledge		40% of current participants in our U.S. bearing co-op program are ethnically or gender diverse. Currently, we have three associate resource groups that are open to all associates, regardless of race, ethnicity, gender identity and age: Women’s International Network, Multicultural Association of Professionals, and Young Professionals Network Examples of regular, formal training and development activities include: • Harvard ManageMentor^® Diversity, Inclusion and Belonging course for managers; • Our Engaged Leader program, which provides learning opportunities to further our culture of connectedness and growth through consistent conversations and team meetings; • The Signature Program, with whom we have collaborated since 2014 to augment development and support Timken female leaders in enriching their leadership capabilities; and • The Operations Development Program, an accelerated training program designed to increase the internal pool of people prepared to take on our Company’s leadership positions. We are also committed to providing competitive and equitable compensation based on the local markets in which we operate while supporting employee health. We conduct market studies around the world to ensure full-time associates receive competitive benefits relative to the markets where they work.

Sustainability		Through our industrial repair and service business, we recycle numerous tons of steel and copper each year from service parts that cannot be reused.

		Working with our supplier, Ranpak, one of the global leaders in environmentally friendly packaging, we are replacing plastic bubble dunnage with rigid paper dunnage that can be reused and recycled. So far, we have converted eight U.S. facilities to sustainable paper packaging and we are working on extending the program internationally.

		Over the last four years, our manufacturing facilities have implemented several programs recycling more than 1,000 metric tons of plastic.

		2020 represented our lowest recordable injury rate on record.

		From 2018 to 2020, our total waste generation has decreased by over 40% and our total waste to landfill has decreased by over 15%, despite adding more sites to the scope of our reporting.

		In 2020, renewable energy became our single largest end-market sector in terms of total sales and it remained so in 2021. The Company’s products, technology and innovation continue to support the global trend towards sustainability and meet customers’ evolving requirements for optimized reliability and performance. In addition, the Company has announced more than $75 million in capital investments through early 2022 to increase the Company’s renewable energy capabilities across its global footprint.

Leadership		Our corporate charitable giving focus areas for 2020 included associate giving, basic needs, education, and reputation and community building.

		In 2020, we gave in excess of $1.6 million in the U.S. alone to support basic needs, education, and community building.

		We have also committed to being a STEM partner for the I PROMISE School, a collaboration between the LeBron James Family Foundation and Akron Public Schools.

		We published our enterprise-wide human rights policy which details, amongst other items, our:

		• Stance against human trafficking and forced labor; • Care for the health and safety of our associates and others; • Embrace of diversity and intolerance of discrimination; • Commitment to competitive and equitable pay; • Respect for the principles of freedom of association and collective bargaining; • Promotion of the development of our communities; and • Support for access to clean water.

In consideration of our efforts, we were named one of the World’s Most Ethical Companies^® by Ethisphere^® Institute for the eleventh time, among America’s Most Responsible Companies by Newsweek and Statista and one of America’s Best Employers, America’s Best Employers for New Graduates and America’s Best Employers for Women by Forbes in 2021.

For more information regarding our corporate social responsibility program, please see our most recent corporate social responsibility report available on our website at https://www.timken.com/ corporate-social-responsibility/.

Shareholder Engagement in 2021

LOGO

Risk Oversight

The Board of Directors primarily relies on its Audit Committee for oversight of the Company’s risk management. The Audit Committee regularly reviews issues that present particular risks to the Company, including those involving competition; economic conditions; planning and strategy; finance; sales and marketing; product technology and innovation; information technology and cybersecurity; facilities, operations and supply chain; environmental, health and safety; product warranty; talent management; and other matters. The full Board and other Committees also review certain of these issues as appropriate. The Board believes that this approach, supported by our leadership structure, provides appropriate checks and balances against undue risk taking.

Shareholder Communications

Shareholders or interested parties may send communications to the Board of Directors, to any standing committee of the Board, or to any Director, in writing c/o The Timken Company, 4500 Mt. Pleasant Street NW, North Canton, Ohio 44720. Shareholders or interested parties also may submit questions, concerns or reports of misconduct through the Timken Helpline at 1-800-846-5363 and may remain anonymous. Such communications may be reviewed by the office of the Vice President, General Counsel & Secretary to ensure appropriate and careful review of the matter.

BENEFICIAL OWNERSHIP OF COMMON SHARES

The following table shows, as of January 1, 2022, the beneficial ownership of our common shares by each Director, nominee for Director and executive officer named in the 2021 Summary Compensation Table on page 58 of this Proxy Statement, and by all Directors, nominees for Director and executive officers as a group. Beneficial ownership of our common shares has been determined for this purpose in accordance with Rule 13d-3 under the 1934 Act and is based on the sole or shared power to vote or direct the voting or to dispose or direct the disposition of our common shares. Beneficial ownership as determined in this manner does not necessarily bear on the economic incidents of ownership of our common shares.



Amount and Nature of Beneficial Ownership of common shares

Name ⁽¹⁾	Sole Voting or Investment Power ⁽²⁾		Shared Voting or Investment Power		Aggregate Amount ⁽²⁾		Percent of Class

Christopher A. Coughlin		263,801		0		263,801		*

Maria A. Crowe		20,511		0		20,511		*

Philip D. Fracassa		150,482		0		150,482		*

Elizabeth A. Harrell		10,511		0		10,511		*

Richard G. Kyle		645,619		0		645,619		*

Sarah C. Lauber		400		0		400		*

John A. Luke, Jr.		68,753		0		68,753		*

Christopher L. Mapes		21,160		0		21,160		*

James F. Palmer		16,205		0		16,205		*

Hansal N. Patel		7,497		0		7,497		*

Ajita G. Rajendra		19,250		0		19,250		*

SEC Form DEF 14A filed by Timken Company