TL;DR
ServiceNow amended CEO Bill McDermott’s employment agreement, extending his contract through at least Dec. 31, 2030, and adding the possibility that he could serve as co-CEO, Executive Chairman or Non‑Executive Chairman. The company says no leadership change is planned now, but the filing defines compensation treatment and requires board approval and McDermott’s agreement for any role change.
What happened
In a recent SEC filing, ServiceNow revised Bill McDermott’s employment contract to extend his tenure with the company through at least December 31, 2030, and to specify alternative roles he could occupy in the future. Beyond CEO, the agreement lists co-CEO, Executive Chairman and Non‑Executive Chairman as potential designations the board may assign, subject to the board’s approval and a mutual understanding with McDermott. The amendment also outlines how McDermott’s pay would be determined if he serves as co‑CEO (tied to company performance against a compensation peer group) or Executive Chairman (linked to the duties he performs). ServiceNow told reporters that the amendment does not reflect a decision to adopt a new leadership structure and that no leadership changes have been made. The filing notes McDermott’s prior experience as co‑CEO at SAP from 2010 to 2014 and his recruitment to ServiceNow in 2019.
Why it matters
- The contract amendment gives ServiceNow formal flexibility to alter its top leadership without a separate new agreement.
- Specifying pay treatment for alternative roles reduces ambiguity about executive compensation in the event of a role change.
- Any shift would require board approval and McDermott’s consent; governance is notable because McDermott also chairs the board.
- ServiceNow would join other large firms that have used co‑CEO arrangements, indicating broader corporate governance precedent.
Key facts
- The amended employment agreement extends Bill McDermott’s service at ServiceNow through at least Dec. 31, 2030.
- The filing lists four possible roles for McDermott: CEO, co‑CEO, Executive Chairman or Non‑Executive Chairman.
- ServiceNow said the amendment does not represent a board decision to change leadership and that no changes have been made.
- Compensation as CEO or co‑CEO would be tied to company performance against its compensation peer group.
- If McDermott were to serve as Executive Chairman, his pay would reflect the responsibilities he performs in that role.
- Any change in McDermott’s role would require board approval and his mutual understanding; he currently chairs the board.
- McDermott was co‑CEO of SAP from 2010 to 2014 and joined ServiceNow in 2019 under an earlier employment agreement that did not include alternative role language.
- The filing was published in an SEC submission made public by the company last week.
What to watch next
- Whether ServiceNow’s board will move to adopt a co‑CEO or other alternative leadership structure — not confirmed in the source.
- Any future adjustments to McDermott’s compensation if his title or responsibilities change — not confirmed in the source.
- Potential governance discussions given McDermott’s dual role as CEO and board chair — not confirmed in the source.
Quick glossary
- Co‑CEO: A leadership arrangement in which two executives share chief executive responsibilities and jointly lead the company.
- Executive Chairman: A chair of the board who also has active management responsibilities or operational duties within the company.
- Non‑Executive Chairman: A board chair who does not take part in the company’s day‑to‑day management but leads the board of directors.
- SEC filing: A public disclosure submitted to the U.S. Securities and Exchange Commission that provides information about a company’s operations, governance or financial matters.
- Compensation peer group: A set of comparable companies used to benchmark executive pay and evaluate performance‑linked compensation.
Reader FAQ
Is ServiceNow changing its leadership right now?
ServiceNow stated the contract amendment does not reflect any current change and no leadership changes have been made.
What roles does the amended agreement allow for Bill McDermott?
The agreement lists CEO, co‑CEO, Executive Chairman and Non‑Executive Chairman as possible roles.
How long does McDermott’s extended contract run?
The amendment extends his employment through at least Dec. 31, 2030.
Will McDermott’s compensation change if his role changes?
The filing states pay for CEO or co‑CEO would be linked to performance against a compensation peer group, and pay as Executive Chairman would reflect responsibilities; detailed amounts are not provided.
CXO 1 ServiceNow lays out possible co-CEO structure, but says no change imminent The ITSM outfit would join Oracle, Comcast, and Netflix in installing bunk beds in the corner office…
Sources
- ServiceNow lays out possible co-CEO structure, but says no change imminent
- ServiceNow, Inc. CEO Employment Agreement with …
- ServiceNow Announces Bill McDermott to Become CEO …
- Newsroom | Media Resources, News, Press Releases
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