UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549​

SCHEDULE 14A​

Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934
(Amendment No. 1)

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Preliminary Proxy Statement

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Definitive Proxy Statement

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Definitive Additional Materials

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Soliciting Material under §240.14a-12

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23andMe Holding Co.

(Name of Registrant as Specified In Its Charter)​

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Fee paid previously with preliminary materials.

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

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EXPLANATORY NOTE

On July 26, 2023, due to a clerical error by the financial printer, an EDGAR filing by 23andMe Holding Co. (“23andMe”) was inadvertently filed. 23andMe is correcting this error by refiling the definitive proxy statement as a “DEFR14A” submission. This EDGAR filing constitutes 23andMe’s filing of a definitive proxy statement for its 2023 Annual Meeting of Stockholders to be held on September 6, 2023. 23andMe will distribute and make available to its stockholders this definitive proxy statement. Due to the initial inadvertent filing, 23andMe is technically unable to file this definitive proxy statement as a “DEF 14A” submission. Accordingly, 23andMe is filing this definitive proxy statement as a “DEFR14A” submission, which is intended to replace, in its entirety, the definitive proxy statement that initially was filed.

 

23andMe Holding Co.

Notice of 2023 Annual Meeting of
Stockholders and Proxy Statement

 

July 27, 2023

TO OUR FELLOW STOCKHOLDERS:

We invite you to join us for the 2023 Annual Meeting of Stockholders (the “Annual Meeting”) of 23andMe Holding Co., to be held at 8:30 a.m., Pacific Time, on Wednesday, September 6, 2023. The Annual Meeting will be held as a virtual meeting, to be conducted exclusively via live webcast at www.virtualshareholdermeeting.com/ME2023. Details regarding how to participate in the webcast of the Annual Meeting and the business to be conducted at the Annual Meeting are provided in the accompanying Notice of Annual Meeting of Stockholders (the “Notice”) and Proxy Statement.

During Fiscal 2023, we continued to make progress in our mission to help people access, understand, and benefit from the human genome by increasing the number of health reports, features, and polygenic risk reports in both our Personal Genome Service® and our 23andMe+ subscription service. With over 60 new reports introduced during Fiscal 2023, we continued to grow our customer base to over 14 million genotyped customers and over 640,000 23andMe+ subscription members. We also focused on continuing to grow our drug development efforts, expanding our therapeutics pipeline to more than 50 active programs, which included the start of our first wholly-owned cancer therapy into a Phase 1 clinical trial, currently in the Phase 2a portion of a Phase 1/2a study.

We are entering the next chapter of healthcare and continue to make progress with customers and stockholders in mind. We believe that we have a unique set of genetic data and tools that will continue growth well into the future while we continue to leverage our unique strengths to enhance genetic understanding, optimize health outcomes, and ultimately bring new therapeutics to healthcare.

We are thankful for your support and continued investment in 23andMe.

Whether or not you plan to join us for the Annual Meeting, it is important that your shares be represented. We encourage you to vote by telephone, by mail, or online by logging into www.proxyvote.com after reading the Notice and Proxy Statement.

Always forward,

 

 

Notice of Annual Meeting of Stockholders

 

Items of Business

The Proxy Statement describes each of these proposals in detail. In addition, we will transact any other business that may properly come before the Annual Meeting, and at any adjournments, continuations, or postponements thereof.

Important Voting Information

Even if you plan to virtually attend the Annual Meeting, we urge you to vote as soon as possible in one of the following ways:

Participating in the Annual Meeting

Holders of Class A common stock and Class B common stock as of the record date are invited to attend the Annual Meeting by visiting www.virtualshareholdermeeting.com/ME2023. Our goal is to ensure that stockholders have the same rights and opportunities to participate in the Annual Meeting as you would at an in-person meeting. You will be able to attend the meeting online, vote your shares electronically, and submit questions during the meeting. To do so, you will need the unique 16-digit control number printed in the box on your Notice of Internet Availability of Proxy Materials or proxy card. Please see page 82 for more information.

 

​	​	YOUR VOTE IS IMPORTANT	​	​
​	​	Please carefully review the proxy materials for the Annual Meeting and cast your vote.	​	​

Forward-Looking Statements

This proxy statement contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). The words “believes,” “anticipates,” “estimates,” “plans,” “expects,” “intends,” “may,” “could,” “should,” “potential,” “likely,” “projects,” “predicts,” “continue,” “will,” “schedule,” and “would” or, in each case, their negative or other variations or comparable terminology, are intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words. These forward-looking statements are predictions based on our current expectations and projections about future events and various assumptions. We cannot guarantee that we will actually achieve the plans, intentions, or expectations disclosed in these forward-looking statements and you should not place undue reliance on our forward-looking statements. These forward-looking statements involve a number of risks, uncertainties (many of which are beyond our control), or other assumptions that may cause actual results or performance to differ materially from those expressed or implied by these forward-looking statements. The forward-looking statements contained herein are also subject to other risks and uncertainties that are described in the Fiscal 2023 Form 10-K filed with the SEC on May 25, 2023 and in the reports subsequently filed by us with the SEC. The statements made herein are made as of the date hereof and, except as may be required by law, we undertake no obligation to update them, whether as a result of new information, developments, or otherwise.

 

Incorporation by Reference

Neither the Compensation Committee Report nor the Report of the Audit Committee included herein shall be deemed soliciting material or filed with the SEC and neither of them shall be deemed incorporated by reference into any prior or future filings made by us under the Securities Act or the Exchange Act, except to the extent that we specifically incorporate such information by reference.

In addition, this document includes several website addresses. These website addresses are intended to provide inactive, textual references only. The information on these websites is not part of this Proxy Statement.

Other Information

References in this Proxy Statement to “23andMe,” the “Company,” “we,” “our,” and “us” refer to 23andMe Holding Co., a Delaware corporation. References to “Fiscal 2023” refer to our fiscal year ended March 31, 2023, and references to “Fiscal 2024” refer to our fiscal year ending March 31, 2024. Further, references to “Fiscal 2022” refer to our fiscal year ended March 31, 2022, and references to “Fiscal 2021” refer to our fiscal year ended March 31, 2021.

23andMe was a special purpose acquisition company called VG Acquisition Corp. (“VGAC”) prior to the closing of the Business Combination on June 16, 2021. As used in the proxy statement, the term “Business Combination” represents the transactions contemplated by an agreement and plan of merger (the “Merger Agreement”) whereby a subsidiary of VGAC merged with and into 23andMe, Inc. For further information on the Business Combination, please refer to our Annual Report.

 

TABLE OF CONTENTS

 

 

Proxy Statement Summary

ABOUT 23ANDME

Our mission is to help people access, understand, and benefit from the human genome. To achieve this, we are building the leading direct-to-consumer precision medicine platform that powers our genetics-driven therapeutics and research business.

We are dedicated to empowering customers to live healthier lives by providing consumers direct access to their genetic information, and digital access to affordable personalized healthcare through our Lemonaid Health Inc. (“Lemonaid” or “Lemonaid Health”) telehealth platform.

We pioneered direct-to-consumer genetic testing, giving consumers unique, personalized information about their genetic health risks, ancestry, and traits. We were the first company to obtain Food and Drug Administration (“FDA”) authorization for a direct-to-consumer genetic test, and we are the only company to have FDA authorization, clearance, or an exemption from premarket notification for all of the carrier status, genetic health risk, cancer predisposition, and pharmacogenetics reports that we offer to customers. As of March 31, 2023, we had over 60 health and carrier status reports that were available to customers in the U.S. In addition, our 23andMe+ premium subscription service offers customers the Health + Ancestry Service plus pharmacogenetic reports, a hereditary prostate cancer genetic health risk report (HOXB13-related), over 30 personalized genetic health predisposition reports based on our research, in areas such as migraines, depression, asthma, coronary artery disease, and lupus, and advanced ancestry and health features.

Through our Lemonaid Health telehealth platform, we connect patients to licensed healthcare professionals to provide affordable and direct online access to medical care, from consultation through treatment, for a number of common conditions, using evidence-based guidelines and up-to-date clinical protocols. When medications are prescribed by Lemonaid Health’s affiliated healthcare professionals, patients can use Lemonaid Health’s online pharmacy for fulfillment. Patients also can access telehealth consultations for certain 23andMe genetic reports through Lemonaid.

We believe that we can revolutionize research through our premier database of genetic and phenotypic information crowdsourced from our millions of engaged customers. We have built the world’s largest crowdsourced platform for genetic research, with over 80% of our customers electing to participate in our research program. We believe that this platform allows us to accelerate research at an unprecedented scale, enabling us to discover insights into the origins of diseases and to speed the discovery and development of novel therapies.

We are developing a broad portfolio of genetically validated therapeutic candidates for a variety of diseases across different therapeutic areas with high unmet medical need. We have a diversified and differentiated portfolio, including one product candidate in clinical development, as well as multiple discovery programs. Each of our programs has been validated through our human genetics drug discovery platform. We believe that the combination of a genetically validated discovery platform, to increase the probability of technical success, and a maturing therapeutic portfolio will position us for long-term success in our goal to advance next-generation, targeted medicines for people living with serious and life-threatening diseases.

 

CORPORATE CULTURE HIGHLIGHTS

Our Culture

Our Company is based on the foundation that all of us are linked by a shared thread, our DNA. We are all 99.5% genetically alike; our similarities are so much greater than any differences. It is a scientific fact.

We are on a journey to provide opportunity for all: our employees, our community, and our customers. Although that journey is far from over, we have been working tirelessly to make our product, our community, and our entire company more diverse, equitable, and inclusive.

Our Values

Recent Recognitions

We are proud to be recognized for our strong corporate culture and our employees’ workplace experience:

 

CORPORATE GOVERNANCE HIGHLIGHTS

Corporate Governance Practices

We consistently seek to follow best practices in corporate governance. Highlights of our corporate governance practices include:

Board Refreshment and Qualifications

The independent directors of our Board of Directors (the “Board”) are charged with the responsibility of evaluating each director’s qualifications, performance, and ability to contribute productively to help ensure the appropriate composition and tenure of the Board.

While Board refreshment is an important consideration in the Board’s assessment of its composition, we believe the best interests of the Company are served by being able to take advantage of all available talent, and that the Board should not make determinations with regard to its membership solely on the basis of age. Accordingly, there are no established limits for retirement from the Board. Similarly, the Board does not believe it is appropriate to institute fixed limits on the tenure of directors because the Company and the Board would thereby be deprived of experience and knowledge. Accordingly, there are no established term limits for service on the Board.

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

 

 

Board Snapshot

* With the exception of Drs. Montgomery Rice and Hernández, who were appointed to the Board on June 16, 2021 and November 8, 2021, respectively, all of the directors were elected to the Board in connection with the Business Combination. As such, data relating to tenure includes board service on 23andMe, Inc. prior to the Business Combination.

Director Overview

 

Stockholder Engagement

Engaging with our stockholders is critically important to our Board and management team. The goal of our outreach efforts is to solicit feedback and identify issues of importance to our stockholders. Additionally, we proactively communicate with the investment community and stockholders about our financial performance, operations, and strategic developments through the following:

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Quarterly earnings releases, investor presentations, and conference calls;

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In-person and telephonic meetings with investors and stakeholders;

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Attendance, presentation, and in-person investor meetings at healthcare conferences;

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Proactive outreach to our largest stockholders; and

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Our annual stockholders meeting, which includes a Q&A session.

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During Fiscal 2023, we conducted outreach to many of our largest non-affiliate stockholders.

 

CORPORATE SOCIAL RESPONSIBILITY AND DE&I

Community Impact and Collaborations

We strive to positively impact communities affected by where we work and the work we do. We developed comprehensive Engagement Guidelines and a rubric for evaluating community organizations as we look to support more partnerships and events in the future. As we are committed to embedding diversity, equity, and inclusion (“DE&I”) in everything we do, these guidelines help to ensure that DE&I is a guiding tenet of our community involvement.

Environmental, Social, and Governance

Following the Business Combination, the Company has been working to create a meaningful Environmental, Social, and Governance (“ESG”) program. In Fiscal 2023, we took important steps to accomplish this, including publishing our first ESG Report.

Diversity, Equity, and Inclusion

We are committed to making our product, our community, and our entire company more diverse, equitable, and inclusive. We have developed four key pillars to hold our leadership, employees, and collaborators accountable:

 

EXECUTIVE COMPENSATION HIGHLIGHTS

For a detailed discussion of our executive compensation program, please see the “Compensation Discussion and Analysis” section of this Proxy Statement beginning on page 36.

Executive Compensation Practices

We intend to design our executive compensation program to (i) allow us to attract and retain highly qualified executive officers and (ii) allow these executive officers the opportunity to own a portion of the Company. Consistent with this philosophy, we aim to attract and retain highly qualified, experienced executive officers who can make significant contributions to our long-term business success; reward executive officers for achieving business goals and delivering strong performance; and align executive incentives with stockholder value creation. The following compensation practices demonstrate how we believe our executive compensation program reflects best practices and reinforces our culture and values:

​	​	What We Do	​	​
​	​	Maintain an independent Compensation Committee ​	​	​
​	​	Retain an independent compensation consultant ​	​	​
​	​	Conduct an annual executive compensation review with benchmarks derived from a reasonable set of similar-industry peer companies ​	​	​
​	​	Emphasize “at-risk” or variable compensation, including the implementation of a bonus program for NEOs in Fiscal 2023 ​	​	​
​	​	Establish multi-year vesting requirements ​	​	​
​	​	Maintain double-trigger change-of-control arrangements ​	​	​
​	​	Conservative compensation risk profile ​	​	​
​	​	​	​	​

​	​	What We Don’t Do	​	​
​	​	Excise tax gross-up payments ​	​	​
​	​	Derivatives or hedging of equity securities ​	​	​
​	​	Pledging of equity securities ​	​	​
​	​	Multi-year employment agreements with NEOs ​	​	​
​	​	Stock option repricing without stockholder approval ​	​	​
​	​	Executive retirement plans ​	​	​
​	​	Excessive perquisites ​	​	​
​	​	Excessive executive severance rights or single-trigger change-of-control arrangements ​	​	​
​	​	​	​	​

Fiscal 2023 Compensation Program Elements

The following table summarizes the key compensation elements provided to all our named executive officers (“NEOs”) in Fiscal 2023:

 

Recent Evolution of Our Executive Compensation Program

The Board and the Compensation Committee have continued to review and evaluate our executive compensation practices and policies. In connection with our goals to align executive realizable pay outcomes to our performance over both the short- and long-term, in June 2022, the Compensation Committee adopted the Annual Incentive Plan, pursuant to which, beginning with Fiscal 2023, the NEOs were eligible to receive annual incentive bonuses in the form of restricted stock units (“RSUs”), based upon the Company’s achievement of certain pre-established financial, operational, and strategic performance metrics. The Compensation Committee believes that the Annual Incentive Plan is an important component of the Company’s executive compensation program, as the opportunity to earn variable at-risk compensation will motivate and reward NEOs for achieving annual financial results. Moreover, the adoption of the Annual Incentive Plan represents the Compensation Committee’s commitment to a pay-for-performance compensation model.

VOTING MATTERS AND RECOMMENDATIONS

ADDITIONAL INFORMATION

Refer to the “Additional Information About Our Annual Meeting and Voting” section of this Proxy Statement beginning on page 81 for important information about the proxy materials, voting, the Annual Meeting, Company documents, communications, and the deadlines for submitting stockholder proposals and other pertinent information.

 

PROPOSAL 1

Election of Directors

During Fiscal 2023 and until June 2023, our Board of Directors (the “Board”) consisted of nine members. Currently, our Board consists of eight members and is divided into three classes, designated as Class I, Class II, and Class III. We are committed to strong corporate governance, and our Board regularly reviews our governance structure, including our classified board structure. Our Certificate of Incorporation divides our Board into three classes, with each class elected to serve a three-year term. Our Certificate of Incorporation also provides that the number of directors constituting each class will, as nearly as is practicable, be equal. As a result, at each annual meeting of stockholders, approximately one-third of our directors are elected to serve for a three-year term. Our Board has periodically considered the continued appropriateness of this classified board structure and believes that our classified board structure provides important benefits, including:

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Promoting Stability and Enhancing Institutional Knowledge. Our classified board structure enhances stability and continuity of leadership because our Board will always include directors with prior experience with our operating and regulatory environment, business, strategic goals, competition, trends, and risks.

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Supporting Achievement of Long-Term Strategy. We believe that our classified board structure will help our Board maintain a long-term perspective, leading to decisions that are in the long-term interests of our Company and stockholders, while being responsive to short-term needs and objectives.

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Maximizing Stockholder Value. We believe that a classified board enhances our ability to achieve value for our stockholders in the event of an unsolicited takeover. Without a classified board, a potential acquirer could gain control of our Board at a single annual meeting by replacing a majority of directors with its own nominees without paying a premium to our stockholders.

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Enhancing Director Independence. We believe that a classified board with three-year terms enhances non-management directors’ independence from special interest groups or other parties whose goals may not be in the best interests of all of our stockholders.

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Our Board has nominated Neal Mohan, Valerie Montgomery Rice, and Richard Scheller for election to the Board at the Annual Meeting. If elected, each director nominee will serve as a Class II director with a term to expire at the 2026 Annual Meeting of Stockholders. Each of the director nominees currently serves as a director of the Company.

The persons named as proxies will vote for each of the director nominees unless you instruct to withhold your vote for one or more of the director nominees. The director nominees have each agreed to serve if elected, and the Board has no reason to believe that any of the director nominees will be unavailable to serve. In the event that a director nominee is unable or declines to serve on the Board at the time of the Annual Meeting, the persons named as proxies intend to vote for a substitute director nominee proposed by the Board, unless the Board decides to reduce the number of directors.

Under our Second Amended and Restated Bylaws (the “Bylaws”), the election of directors is determined by a plurality of the votes cast by the stockholders present in person or represented by proxy at the meeting and entitled to vote thereon. Votes may not be cumulated.

 

CLASS II DIRECTOR NOMINEES

Information regarding each Class II director nominee is set forth below. Each Class II director nominee has a term that expires at the Annual Meeting. In addition to the qualifications set forth below, we believe that each of the Class II director nominees has a reputation for the highest character and integrity, works cohesively and constructively with the other members of our Board and with management of the Company, and demonstrates business acumen and an ability to exercise sound judgment.

 

 

CLASS I CONTINUING DIRECTORS

Information regarding each Class I director is set forth below. Each Class I Director has a term that expires at the 2025 Annual Meeting of Stockholders. In addition to the qualifications set forth below, we believe that each of the director nominees has a reputation for the highest character and integrity, works cohesively and constructively with the other members of our Board and with management of the Company, and demonstrates business acumen and an ability to exercise sound judgment.

 

 

CLASS III CONTINUING DIRECTORS

Information regarding each Class Ill director is set forth below. Each Class Ill Director has a term that expires at the 2024 Annual Meeting of Stockholders. In addition to the qualifications set forth below, we believe that each of the Class Ill directors has a reputation for the highest character and integrity, works cohesively and constructively with the other members of our Board and with management of the Company, and demonstrates business acumen and an ability to exercise sound judgment.

 

Corporate Governance

The following section discusses our corporate governance, including the role of our Board and Board committees. Our Corporate Governance Guidelines, which were adopted to promote the effective functioning of the Board and Board committees and to reflect our commitment to high standards of corporate governance, are periodically reviewed by the Board to verify that they reflect the Board’s evolving corporate governance practices, policies, and procedures. In addition, we have a Code of Business Conduct and Ethics, which applies to all of the Company’s directors, officers, advisors, consultants, contractors, and employees. Our Corporate Governance Guidelines and Code of Business Conduct and Ethics are available on our corporate website at investors.23andme.com/corporate-governance/documents-charters. The Company will provide copies of its Corporate Governance Guidelines and Code of Business Conduct and Ethics to any stockholder, free of charge, upon written request to our Corporate Secretary at 349 Oyster Point Boulevard, South San Francisco, California 94080.

ROLE OF THE BOARD

The business and affairs of the Company are managed by, and under the direction of, our Board, which serves as the ultimate decision-making body of the Company, except for those matters reserved for our stockholders. Our Board is responsible for overseeing management, which is, in turn, responsible for the operations of the Company. Our Board’s primary areas of focus are strategy, risk management, corporate governance, corporate social responsibility, and compliance, as well as evaluating management and guiding changes as circumstances warrant. In many of these areas, significant responsibilities are delegated to Board committees, which are responsible for reporting to the Board on their activities and actions. Refer to the “Corporate Governance — Committees of the Board and Meeting Attendance” section of this Proxy Statement beginning on page 19 for additional information on the Board committees.

BOARD LEADERSHIP STRUCTURE

The current leadership structure of our Board consists of a combined Chair and Chief Executive Officer position that is held by Ms. Wojcicki. The Board has determined that combining the positions of Chair and Chief Executive Officer is most appropriate for the Company at this time, because Ms. Wojcicki in this combined position provides unified leadership and direction to the Company and valuable insight to the Board.

As the Chair, Ms. Wojcicki has primary responsibility for presiding over meetings of the Board and meetings of stockholders. Additionally, the Chair is responsible for the agenda of all Board meetings and for previewing information sent to the Board as necessary and approving meeting schedules to assure that there is sufficient time for discussion of all agenda items.

Non-employee directors meet regularly in executive session without management present. Additionally, at least once a year, the Company schedules an executive session with only independent directors. The chair of the Audit Committee is responsible for presiding over such executive sessions.

BOARD INDEPENDENCE

Our securities are listed on Nasdaq, and we use the standards of  “independence” prescribed by rules set forth by Nasdaq. Under Nasdaq rules, a majority of a listed company’s board of directors must be comprised of independent directors. Under Nasdaq rules, a director will only qualify as an “independent director” if, in the opinion of that company’s board of directors, that person does not have a relationship that would interfere with the exercise of independent judgment in carrying out a director’s responsibilities. Our Board has determined that the following directors are independent under Nasdaq and SEC rules and regulations: Roelof Botha, Patrick Chung, Sandra Hernández, Neal Mohan, Valerie Montgomery Rice, and Peter Taylor. As Anne Wojcicki serves as our Chief Executive Officer and Richard Scheller provides consulting services to the Company, they are not deemed to be independent. Additionally, for the entirety of Fiscal 2023 and until his passing in June 2023, Evan Lovell served as a director of the Company; the Board did not consider Mr. Lovell to be independent during his tenure as a director.

 

There are no family relationships among any of the current directors, director nominees, and executive officers of the Company.

Additionally, the Board has determined that each current member of the Audit Committee and Compensation Committee meets all applicable independence requirements under the Nasdaq rules and applicable SEC rules and regulations.

BOARD TENURE AND REFRESHMENT

It is the Board’s view that, while Board refreshment is an important consideration in the Board’s assessment of its composition, the best interests of the Company are served by it being able to take advantage of all available talent, and that the Board should not make determinations with regard to its membership solely on the basis of age. Accordingly, there are no established limits for retirement from the Board. Similarly, the Board does not believe it is appropriate to institute fixed limits on the tenure of directors because the Company and the Board would thereby be deprived of experience and knowledge. Accordingly, there are no established term limits for service on the Board.

At the same time, the Board recognizes that incumbent directors should not expect to be renominated automatically or continually. To this end, the Board is required to evaluate each incumbent director’s qualifications, performance, and ability to continue to contribute productively before nominating that director for an additional term. This evaluation includes a review of the results of the Board’s self-evaluation process and the Company’s needs at a particular point in time.

BOARD DIVERSITY

Our Board believes that, as a group, the directors should have diverse backgrounds and experiences. We believe that the members of the Board, as a group, have such diversity in terms of backgrounds and experiences, including varied race, ethnicity, nationality, gender, age, and other attributes. Our Corporate Governance Guidelines include a formal diversity policy that requires any search firm engaged to assist with director recruitment to include women and minority candidates in the pool from which the independent directors select director candidates.

The following diversity matrix sets forth information regarding the self-identification selections that our directors consented to be disclosed in the Proxy Statement:

 

The Board also believes that its members should be diverse in their qualifications and should represent a range of skills, areas of expertise, and depth of experience in areas that are relevant to and contribute to the Board’s oversight of the Company’s business, enterprise risks, and strategic priorities.

The Company has identified the following key experiences, qualifications, and skills from questionnaires completed by each of our directors. We believe that this reflects a balanced mix of experience, qualifications, and attributes of the Board as a whole. This high-level summary is not intended to be an exhaustive list of each director’s skills or contributions to the Board, and we believe that each of our directors has a broad array of knowledge, experience, and skills.

DIRECTOR NOMINATIONS

Identifying Director Candidates

Our independent directors are responsible for identifying and selecting qualified nominees for election or, in the case of a vacancy, appointment to the Board. Director candidates may come to the attention of the independent directors from a variety of sources, including current Board members, stockholders, and management. All candidates are reviewed in the same manner, regardless of the source of the recommendation.

 

The process for seeking and vetting additional director candidates is ongoing and is not dependent upon the existence of a vacancy on the Board. The Board believes that this ongoing pursuit of qualified candidates functions as an appropriate director succession plan. Pursuant to our Corporate Governance Guidelines, our independent directors have the authority to retain consultants and search firms to assist in the process of identifying and evaluating candidates. Any search firm that is engaged for a new director search must include women and minority candidates in its pool of candidates.

Director Time Commitment Considerations

In evaluating nominees to serve on our Board, the independent directors consider whether a director nominee has the ability to effectively fulfill his or her duties as a director of the Company, especially with regard to the director nominee’s expected time commitments with respect to his or her occupation and/or service as a director of other public companies.

Our Corporate Governance Guidelines set forth guidelines regarding the number of public company boards and audit committees on which members of our Board may serve. Unless the Board determines that the carrying out of a director’s responsibilities to the Company will not be adversely affected by the director’s other directorships:

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Directors who also serve as executive officers of a public company may not serve on more than a total of two public company boards (including the Company’s Board); and

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•

Directors who are not executive officers of a public company may not serve on more than four public company boards in addition to the Company’s Board.

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Additionally, if a member of the Company’s Audit Committee wishes to serve on the audit committees of more than a total of three public companies, the Board must approve such additional service, after determining whether such simultaneous service impairs the director’s ability to serve effectively on the Company’s Audit Committee, before the director accepts the additional position.

Our Board believes that each of our directors has demonstrated the ability to devote sufficient time and attention to Board duties and to otherwise fulfill the responsibilities required of our directors. However, we understand that certain of our stockholders and/or proxy advisory firms may deem Roelof Botha “overboarded” under their policies. After careful consideration, the Board believes that Mr. Botha has dedicated, and will continue to dedicate, sufficient time to carry out his duties as a member of the Board and the committees thereof. Additionally, the Board believes that his services with other public companies do not, and will not, negatively impact his service on our Board.

Stockholder Recommendations for Director Candidates

Stockholders may recommend director candidates for consideration by our independent directors by giving written notice of the recommendation to the Corporate Secretary of the Company at the Company’s principal executive offices at 349 Oyster Point Boulevard, South San Francisco, California 94080. In considering candidates recommended by stockholders, our independent directors will take into consideration the needs of the Board and the qualifications of each candidate. For additional information regarding stockholder nominations and recommendations, please see the “Stockholder Proposals and Nominations for the 2024 Annual Meeting” section of this Proxy Statement on page 80.

DIRECTOR QUALIFICATIONS AND CONSIDERATION OF DIRECTOR CANDIDATES

When considering candidates for the Board, our independent directors evaluate the entirety of each candidate’s credentials and do not have specific eligibility requirements or minimum qualifications that must be met by a candidate. The independent directors are also responsible for reviewing from time to time the appropriate skills and characteristics required of Board members in the context of the background of existing members and in light of the perceived needs for the future development of the Company and the best interests of the Company and its stockholders. This assessment includes issues of diversity and experience in different substantive areas including, without limitation, risk management, operations, marketing, accounting, legal, finance, investment and capital raising, strategic growth and business development, biotechnology, healthcare, mergers and acquisitions, technology and digital expertise, cybersecurity, environmental, social, and governance (ESG), human capital management, and diversity, equity, and inclusion (DE&I). All directors should possess the highest personal and professional ethics, integrity, and demonstrated leadership, and be committed to representing the long-term interests of the Company and its stockholders.

 

The Company believes that the Board as a whole should have competency in the following areas:

The Board seeks the best director candidates based on the skills and characteristics required without regard to race, color, national origin, religion, disability, marital status, age, sexual orientation, gender, gender identity and expression, or any other basis protected by federal, state, or local law. The independent directors actively seek candidates for the Board who embody diversity in skills, abilities, industry knowledge, experience, gender, race, ethnicity, and veteran and disability status, as well as such other factors considered useful depending on the needs of the Company at such time.

OTHER POLICIES RELATED TO SERVICE AS A DIRECTOR

Directors Who Change Their Job Responsibility

When a director’s principal occupation or business association changes substantially from that which they held when first elected to the Board (including retirement), they will be required to tender a resignation as a director promptly to the Board. The Board will consider whether to accept or reject the tendered resignation, taking into consideration the effect of such change on the interests of the Company.

Directors Who Cease to be Independent

Each director is required to notify the Board of any change in circumstances that may impact their independence. If so notified, the Board will reevaluate, as promptly as is practicable thereafter, such director’s independence. An independent director who ceases to qualify as such after election to the Board will be required to tender a resignation as a director promptly to the Board, which will consider whether to accept or reject the resignation, taking into consideration the effect of such change on the interests of the Company.

COMMITTEES OF THE BOARD AND MEETING ATTENDANCE

A total of five meetings of the Board were held during Fiscal 2023. During Fiscal 2023, the non-employee directors met alone without management present on one occasion.

Except with respect to Evan Lovell, each director attended 75% or more of the aggregate of  (i) the total number of meetings of the Board held during the time in which such director was a member of the Board and (ii) the total number of meetings held by all committees of the Board on which such director served during the period such director served as a member of such committee. Mr. Lovell served as a director of the Company for the entirety of Fiscal 2023 and until his passing in June 2023. Due to illness, Mr. Lovell attended three of the five Board meetings held during Fiscal 2023.

While we do not have a formal policy on director attendance at annual meetings, directors are expected to attend our annual meeting of stockholders. All of the directors virtually attended the 2022 Annual Meeting of Stockholders.

 

Committees of the Board

The Board has two standing committees, each of which is described below. The responsibilities of each standing committee are set forth in a written charter. Each committee reviews its charter annually and makes recommendations for changes to the Board. The Board may form new committees, disband existing committees, and delegate additional responsibilities to a committee.

The Board’s standing committees and their current members are as follows:

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Committee Chair

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Member

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Financial Expert

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BOARD EVALUATION PROCESS

On an annual basis, the members of the Board and each Board committee conduct a confidential self-assessment of their performance. The Board believes it is important to assess its overall performance, the performance of the Board committees, and the individual performance of each director. In order to serve the best interests of our stockholders and position the Company for future success, the Board reviews its overall composition, including director tenure, Board leadership structure, diversity, and individual skill sets as part of the evaluation process.

BOARD ROLE IN RISK OVERSIGHT

The Board has primary responsibility for risk oversight and, in this capacity, oversees the management of risks related to the operation of our Company. The Board executes its oversight duties in part by assigning responsibility to committees of the Board to oversee

 

the management of risks that fall within their respective areas. In performing this function, each Board committee has full access to management, as well as the ability to engage advisors. The chair of each committee reports on the applicable committee’s activities at each Board meeting and has the opportunity to discuss risk management with the full Board at that time.

Cybersecurity Risk Oversight

Our Chief Security Officer leads our cybersecurity program and provides reports and updates to the Board. The Board has assigned specific oversight of cybersecurity risk to the Audit Committee. As part of the management of cybersecurity as an enterprise risk, we perform various internal and external information security risk assessments. These assessments include third-party penetration testing and secure code review, public bug bounty, and vulnerability reporting programs, as well as independent audits of our information security management systems. Our employees are trained on cybersecurity matters on an ongoing basis. This training includes secure handling of customer and patient data, legally required privacy practices, and important emerging risks. We also conduct targets training throughout the year on topics such as physical security awareness, email phishing, etc. Please see “ESG — Data Security” on page 24 for more information.

ESG Risk Oversight

The Board has primary responsibility for ESG oversight and, in this capacity, oversees the management of risks related to ESG matters. Please see “ESG — ESG Oversight” on page 23 for more information.

Business Continuity

As required by our ISO certifications, we have robust business continuity planning and risk management procedures. As part of the incident response policy, we regularly conduct tabletop exercises including, among other teams, our Marketing, Human Resources, and Legal departments to walk through various situations and develop preparedness plans. In addition, the data security team practices resolution procedures monthly in the event of a security breach. We have also developed redundancies in our supply chain and kit fulfillment/genotyping services to continue providing services during a location-based disruption.

 

COMMUNICATIONS WITH THE BOARD

Stockholders and other interested parties are invited to communicate with the Board, its committees, the Chair, or with non-employee and independent directors as a group by writing to: 349 Oyster Point Boulevard, South San Francisco, California 94080.

All such correspondence should identify the author as a stockholder or other interested party and clearly state the intended recipient. Communications received may be reviewed by the Corporate Secretary for the sole purpose of determining whether it is appropriate. In general, the following types of communication are not related to the duties and responsibilities of the Board and are therefore not appropriate: spam and similar junk mail and mass mailings, unsolicited advertisements or invitations to conferences or promotional material, product complaints, resumes or other job inquiries, and surveys.

ESG

We are committed to good corporate citizenship, which means putting our employees first, striving to create positive impacts within our organization, and aiming to better the communities in which we conduct business. We strive to promote inclusion and diversity, enhance our community involvement, and foster our social stewardship.

We believe that our investment in the following areas will help further advance our mission and ensure our long-term success, while operating ethically, sustainably, and responsibly.

ESG Oversight

The Board as a whole has primary responsibility for ESG oversight and oversees ESG-related risks and opportunities. All Board members have risk management expertise, and four directors have specific experience in corporate social responsibility. The Audit Committee generally oversees financial and compliance matters, while the Compensation Committee generally oversees human capital management and compensation programs.

In March 2022, we formed an ESG Task Force composed of several cross-functional senior leaders that meet quarterly to create and operationalize our ESG initiatives under the Board’s supervision. In addition, the Chief Security Officer oversees cybersecurity and customer privacy programs and regularly provides updates to the Board.

 

Our Practices

Ethical behavior and sound corporate governance underpin our business strategy and operations. We strive to go beyond regulatory compliance to build a strong culture of integrity and transparency.

Corporate Governance and Business Ethics

At 23andMe, integrity is paramount, and we follow high ethical standards. We have adopted a Code of Business Conduct and Ethics (the “Code of Ethics”) covering numerous topics, including corruption, antitrust violations, insider trading, gifts and entertainment, conflicts of interest, and the validity of financial information. We have also established a Global Anti-Corruption Policy for our employees, who are periodically asked to certify compliance in writing. The Audit Committee provides Board-level oversight of ethics and compliance matters.

All employees affirm their commitment annually to the Code of Ethics. In addition, 100% of employees and contractors are required to complete annual ethics and compliance training.

Additionally, we do not have a political action committee (PAC) and make no political contributions. Our political advocacy is centered on promoting policies that protect the privacy and security of individuals’ genetic data. 23andMe is a founding member of the Coalition for Genetic Data Protection, a partnership with other genetic testing companies to provide a unified voice promoting best practices on customer privacy and data security, which educates and advocates for reasonable and uniform privacy regulation to promote the responsible and ethical handling of every person’s genetic data.

Responsible Marketing

We are committed to responsible interactions with consumers and the broader healthcare community. All marketing activities and scientific engagement must conform to the rigorous requirements detailed in our Code of Ethics and Global Anti-Corruption Policy. We have developed strict internal controls for all consumer-facing marketing materials. Our team collaborates with and receives final official approval from, which for our FDA-regulated health products is documented in our Quality Management System, the following departments before publishing consumer-facing materials:

Legal (for all content)

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Regulatory Affairs (for FDA-authorized/cleared content such as health report descriptions and claims)

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Medical Affairs (for content related to health information)

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We require all marketing employees who create consumer-facing marketing, promotional, or other labeling materials to complete annual training of our responsible marketing materials procedures. These marketing procedures are internally audited every year. The Legal, Regulatory, and Medical Affairs departments conduct supplemental training on marketing, pricing, and healthcare compliance to all relevant employees upon hire and annually.

Data Security

Maintaining strict data security is key to protecting our technology and customer information. We integrate best practices to protect our networks and systems from cyber threats and unauthorized use.

We meet the highest industry standards for data security and privacy. After an extensive security audit, our information security management system received its first certification under the globally recognized ISO/IEC 27001:2013 standard in 2019. In 2020, we received certification for two additional standards, ISO 27018 and 27701, which cover our privacy information management system and the security of personal information in cloud computing environments. To maintain these three ISO certifications, we are subject to a third-party annual audit. We also perform third-party penetration testing, secure code review, public bug bounty, and vulnerability reporting programs.

We require 100% of our employees and contractors to complete information security compliance training annually. We also conduct training throughout the year on topics such as physical security awareness and email phishing simulations.

Our People

We strive to put our people first and build an environment where our employees feel welcome, supported, and able to reach their personal and professional development goals. We are in this together, as enshrined in our company’s core values. The Compensation Committee provides Board-level oversight of human capital management to keep us accountable. The Vice President, People provides executive-level oversight alongside the company’s other senior leadership.

Workforce

As of March 31, 2023, we employed approximately 816 employees worldwide, of which approximately 769 were full-time employees and approximately 90% were U.S.-based employees.

We believe that diverse perspectives and an inclusive culture produce a highly energized work environment and a solutions-driven community. We are committed to maintaining this ideal in our workplace and created four key pillars to guide our leadership, employees, and collaborators:

 

DE&I Strategy

We view DE&I as a strategic priority and have assigned oversight responsibilities and allocated the necessary leadership resources to execute our initiatives. Management provides regular updates to the full Board regarding our DE&I initiatives.

Our DE&I strategy is focused on workplace, workforce, marketplace, and community, and is deeply ingrained in our organizational insights, employee data, and industry research and benchmarks. In Fiscal 2023, we achieved the following important milestones of our long-term DE&I strategy:

Through enhanced recruiting and candidate networking efforts, 22.4% of our new hires for Fiscal 2023 were from marginalized communities.

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We added more programs and opportunities to allow employees to find a sense of belonging and gain greater awareness around how DE&I is embedded in our business. These include the launch of a peer-to-peer mentorship program and a liaison network and continued growth in the number of our Employee Resource Groups.

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Our Product and R&D teams continue to use a DE&I by design process to ensure that the DE&I lens is used throughout the entire product lifestyle.

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Our Research team launched our African American Genome Project with the distribution of over 7,000 kits creating a focus on providing people awareness around the importance of knowing your sickle cell carrier status. This project has been instrumental in building trust with African American partners and consumers.

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We aim to grow, learn, and shape our approach to DE&I for the betterment of our workforce and the communities we serve. To that end, we will continue to ensure that we are creating an environment that welcomes conversations about issues that impact our workforce, customers, and the broader community.

DE&I Transparency

We strive to be transparent in our DE&I journey and on our progress toward our goals. Since 2021, we have shared our annual hiring and staff composition data on our website and highlighted areas where we can improve. As of March 31, 2023, 53% of our U.S. workforce are women and approximately 51% self-identify as ethnically or racially diverse.

We also seek external insight into our efforts. In October 2021, our CEO, Anne Wojcicki, joined other top CEOs in signing the Disability: IN CEO Letter ON Disability Inclusion, pledging to advance disability inclusion and urging other leaders to do so as well. As a part of this commitment, we participate in the Disability Equality Index, a benchmarking tool to gauge how inclusive a company’s policies and practices are for employees and customers with disabilities.

Hiring

We incorporate DE&I into hiring through our recruiting and interview processes and management and corporate bonus plan. We have established several measures to ensure that we continue recruiting and hiring diverse candidates:

 

We created onsite interview goals and processes to include at least one candidate who identifies as female and at least one who identifies as Black, Latinx, two or more races, Pacific Islander, or Indigenous American.

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All hiring teams are required to complete inclusive interview training.

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To build diverse talent pipelines, we have recruiting partnerships with several organizations and events, including:

Society for Advancement of Chicanos/Hispanics & Native Americans in Science (SACNAS)

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STEM Excellence through Equity and Diversity (SEED) Scholars Program

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Meyerhoff Scholars Program

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Black Professionals in STEM

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AfroTech

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Street Code Academy

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Boys and Girls Club of the Peninsula

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Rdevia

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Employee Experience

Hiring diverse talent is just one part of our mission to build an inclusive workplace; we are also committed to maintaining an environment where employees stay and thrive. We offer numerous opportunities for employees to continue learning about diversity and inclusion. In 2021, we launched voluntary training on Unconscious Bias, Microaggressions, and Allyship. In Fiscal 2023, 25% of employees participated in DE&I-related training.

An employee training pod took an active role in shaping the next iteration of training by progressing the Allyship course to focus on how to better support underrepresented communities at 23andMe. In addition to offering training, we also build supportive communities by hosting DE&I Lunch and Learn sessions, Speaker Series, and book clubs. 23andMe offers employee affinity groups to provide a place for employees with shared interests, experiences, or characteristics to gather and create community.

Community Impact and Collaboration

As part of our mission to advance DE&I, we aim to have a positive impact on the areas where we live and work by interacting with community organizations and supporting research collaborations for minority groups.

In the summer of 2022, 23andMe teamed up with StreetCode Academy to offer tailored “exposureships” to high school students in the Bay Area. StreetCode Academy is a tech empowerment program for underserved communities of color and provides free classes in coding, entrepreneurship, and makerspace design. Throughout the weeklong exposureships, the students participated in professional development workshops and panels, worked closely with 23andMe mentors, attended company meetings, and received a closer look into what it is like to work at 23andMe.

In addition to StreetCode Academy, in Fiscal 2023, we supported the San Jose School of Arts and Culture and Türkiye earthquake relief efforts.

 

We look to support more partnerships and events in the future, so we have developed a comprehensive Community Organization Engagement Guide and rubric for evaluating opportunities. This document ensures that our interactions with external organizations align with our mission, have a measurable impact, and build meaningful and sustained relationships.

Through our Research Innovation Collaborations Program, we received 40 applications during our most recent submission cycle. Of these submissions, 26 proposals included research related to Black, Latinx, two or more races, Pacific Islander, Asian, or Indigenous American groups.

Employee Training and Development

We provide many resources for employees to continue to grow, advance, and develop as leaders. We provide department learning budgets, internal mentorship programs, and up to $2,300 per employee annually in tuition reimbursement. Our flagship leadership program is a four-month, cohort-based training. The program is designed for managers at all levels, including program, project, individual, and team leaders. During Fiscal 2023, more than 15% of employees participated in this program.

Our performance management framework is designed to support and foster career advancement. It evaluates employees in three areas:

1.

THE WHAT, including job responsibilities, objectives, and key results (OKRs), projects, and goals

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2.

THE HOW, including our core values, collaboration, and team behaviors

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3.

IMPACT on the business, on the Company, and for DE&I and personal citizenship

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Additionally, we strive to provide regular feedback to all employees to support their professional growth. All employees receive an annual performance review and multiple one-on-one developmental check-ins with their manager throughout the year.

Engagement and Retention

We utilize an independent firm to gather feedback and conduct employee engagement surveys. In Fiscal 2023, we launched a DE&I survey to gather feedback on the effectiveness of our DE&I initiatives. With 81% participation, we received very high scores from our employees for how much we value DE&I in our workplace (87%) and for their sense of belonging at the company (80%).

We pride ourselves on our responsiveness to employee feedback and have implemented various programs to improve the employee experience, including:

Every new hire’s onboarding includes a comprehensive 1.5 days of learning about the Company, our work, our people, and our culture. We have quarterly new hire dinners where new hires get to meet Company executives and learn even more about their function and work.

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We offer “23andMe University” bi-annually, which is an all-day educational event for our recent hires to experience a deep dive into the key areas of our business.

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To better recognize employee contributions toward DE&I initiatives, we have incorporated a DE&I component into our performance management framework.

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We collect exit feedback with a thorough list of questions on management, culture, and work experience and use that data to inform our policy/program updates in the future.

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Benefits and Compensation

We firmly believe in investing in our employees’ health, well-being, and wellness. All benefits-eligible employees working at least 20 hours per week receive a competitive package, which includes the following:

Comprehensive insurance (health, vision, dental, and life/accidental death and dismemberment).

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401(k) company matching.

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Reimbursement of up to a lifetime maximum of  $20,000 each for fertility, adoption, and surrogacy expenses.

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An employee assistance program for those experiencing unexpected life challenges or obstacles.

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We know the importance of taking breaks to recharge, give back, or even raise a family, so we offer flexible work and leave options to accommodate:

Exempt employees receive flexible time off that may be used for vacation and other personal events.

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Non-exempt employees receive two floating holidays and accrue at least three weeks of vacation.

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Employees are allowed to take paid time off to volunteer.

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Work-from-home internet stipend plus a one-time reimbursement for home office equipment.

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16 weeks of fully paid parental leave for birthing parents.

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8 weeks of fully paid parental leave for non-birthing parents.

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We have several offerings to support our employees’ mental and physical wellness:

Complimentary health and fitness classes at our onsite gym, including instructor-led yoga, Pilates, cardio, strength, and meditation classes.

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Individual and team wellness challenges that incorporate mental, emotional, physical, and nutritional elements of a healthy lifestyle.

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Online navigation and advocacy service to find the proper care and deal with medical bill questions.

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Complimentary mental health counseling services for employees and their dependents.

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We also provide an employee stock purchase plan (“ESPP”). Our ESPP allows employees to purchase 23andMe stock at a discounted rate. All regular employees, including executive officers (except those holding 5% or more of total stock), may contribute up to 15% of their earnings to purchase Class A common stock during specified periods. As of March 31, 2023, 58% of our eligible employees participated in the plan.

Pay Equity

We conduct bi-annual pay parity analyses and compensation surveys to ensure equitable compensation for all employees. We use Syndio to review pay parity at the end of each compensation planning cycle and present the results with any recommended remedial actions to the CEO, Chief Financial Officer, and Chief Administrative Officer for approval.

Employee Health and Safety

As a healthcare company, we consider the health and safety of our employees to be a top priority. We have several employee trainings that include topics such as:

Emergency response. Volunteer employees at each site are trained to react during emergencies while waiting for first responders to arrive. This training covers topics such as fire extinguisher use, first aid, and cardiopulmonary resuscitation (CPR).

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COVID-19 safety protocols.

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Biosafety, decontamination, and unseen blood handling.

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Dosimetry and Personal Protective Equipment (PPE) programs.

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Since many employees have transitioned to remote work, we focus on ensuring they have safe and productive home environments. We provide a one-time home office equipment stipend for adjustable desks, ergonomic chairs, and other resources.

Our Products

We seek to empower people to explore their genetic and health information, so they can use that knowledge to pursue more personalized healthcare, understand their ancestry, connect with relatives, and help contribute to research discoveries if they choose to. We abide by strict product quality requirements and privacy standards to ensure that our customers receive safe, highly accurate services they can understand and trust. But we are never done building, and we continue to make advancements to enhance the user experience and lead the healthcare industry forward.

 

Advancing Product Inclusivity

We strive to ensure that everyone who uses our product receives meaningful value and has an inclusive and accessible experience. We also recognize the importance of increasing genetic research diversity so that we can conduct more useful research on diseases, develop better therapeutics, and build more insightful products.

In mid-2020, we conducted an initial audit of our product, customer experience, research participation, and database characteristics to identify disparities we could address to improve the customer experience and engagement. We have specifically focused on addressing two major gaps:

Making the customer experience more sex and gender-inclusive.

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Increasing the value that our product delivers to customers from non-European backgrounds.

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After conducting product audits every six months since Fiscal 2021, we will be shifting to an annual cadence so we can focus more on execution.

Sex/Gender Inclusivity

As of September 2021, we allow customers to distinguish between their sex assigned at birth and their gender identity within our relevant product features. This enables our customers, especially our transgender and non-binary customers, to have their gender accurately described if or when they share their profile with genetic relatives or other customers.

Genetics Research Diversity and Product Equity

Our genetic database is Eurocentric, which has historically limited the value of our products for individuals with non-European backgrounds. We have several initiatives to advance genetic diversity, including the Global Genetics Project and the African Genetics Project. As a result of these efforts, in January 2022, we added 25 African genetic groups that correspond closely with ethnolinguistic affiliations. This update delivered enhanced results for over 300,000 customers with African ancestry. We also added eight regions representing Indigenous ancestry in North America in July 2021. We continue to evaluate new ways to offer richer and more detailed information for customers with non-European backgrounds.

Telehealth for All

With Lemonaid now part of the 23andMe family, we plan to extend DE&I initiatives to our telehealth services to ensure a positive experience for patients with diverse backgrounds and needs. The Patient Support Team’s initial focus has been on specific projects aimed at sex and gender inclusivity, appointment scheduling tools, and healthcare provider representation.

Digital Accessibility

We build digital accessibility (a11y) into our product development and design process so that our products can be enjoyed by everyone, including people with hearing, mobility, visual, and cognitive disabilities. Some of the a11y tools we use:

Our design system includes color palettes that meet the minimum color contrast (AA) set by the Web Content Accessibility Guidelines (WCAG), so our content is accessible to users with low vision or color blindness.

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We train our engineers to evaluate accessibility with an automated scan, a keyboard, and a screen reader to help prevent regressions in accessibility.

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Automatic captioning is turned on for our YouTube videos.

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It is important to share this knowledge throughout the company, so we provide ongoing workshops, demos, meetings, and a company-wide presentation on a11y. We have also curated documentation on a11y and created an #accessibility Slack channel where people can ask questions.

RELATED PERSON TRANSACTIONS

Related Person Transaction Approval Policy

The Board has adopted the 23andMe Holding Co. Related Person Transaction Approval Policy (the “RPT Policy”). The RPT Policy applies to any transaction (each, a “Related Person Transaction”) in which:

 

•

23andMe or a subsidiary, partnership, joint venture, or other business association that is effectively controlled by 23andMe, directly or indirectly, is, was, or will be a participant in the transaction;

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•

the amount of the transaction exceeds $120,000; and

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•

a Related Person (as defined below) has, had, or will have a direct or indirect material interest in the transaction.

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Under the RPT Policy, a “Related Person” is (i) any director or executive officer of 23andMe, (ii) any nominee for director (when the information called for by the rules and regulations of the SEC is being presented in a proxy or information statement related to the election of that nominee for director), (iii) any stockholder of 23andMe known to 23andMe to be the beneficial owner of more than 5% of any class of 23andMe’s voting securities (a “5% or Greater Holder”), and (iv) any immediate family member of any such person.

The Audit Committee is responsible for reviewing Related Person Transactions and approving, ratifying, revising, or rejecting Related Person Transactions in accordance with the RPT Policy. Company management is responsible for determining whether a transaction is a Related Person Transaction, including whether the Related Person has a material interest, based on a review of all facts and circumstances, which includes, without limitation, information provided to management in the annual director and officer questionnaires. Upon determination by management that a transaction is a Related Person Transaction and therefore requires review by the Audit Committee, the material facts respecting the Related Person Transaction and the Related Person’s interest in such Related Person Transaction are reported to the Audit Committee. The Audit Committee is entitled to rely on such determinations by management.

Related Person Transactions

The following sets forth a summary of the Related Person Transactions during Fiscal 2023, all of which were approved by the Audit Committee in accordance with the RPT Policy.

 

Executive Officers

Information about Our Executive Officers

Our executive officers are appointed annually by our Board and serve at the pleasure of the Board. The following individuals are our current executive officers:

Anne Wojcicki

Information regarding Ms. Wojcicki is provided above under “Proposal 1 — Election of Directors.”

Joseph Selsavage

Mr. Selsavage is our Interim Chief Financial and Accounting Officer. Previously, he served as the Chief Financial Officer of Lemonaid Health, Inc., which was acquired by the Company in November 2021 and is a wholly-owned subsidiary of the Company. Before joining Lemonaid Health, Inc. in 2020, Mr. Selsavage was a consultant at Red Eclipse Consulting from 2018 to 2020, where he provided accounting and financial systems consulting services. Prior to that, Mr. Selsavage served as the Chief Financial Officer of Metromile, Inc. from 2015 to 2018 and as the Vice President and Chief Financial Officer and other financial roles of Hotwire.com (Expedia, Inc.) from 2001 to 2015. Mr. Selsavage served as the Director of Accounting (Controller) from 1995 to 2001 and as an Accounting Manager from 1993 to 1995 at the International Brotherhood of Teamsters. Mr. Selsavage received his Bachelor of Arts degree in Economics and Financial Management and his Master of Arts degree in Accountancy from Catholic University of America. Mr. Selsavage earned his Master of Business Administration degree from the Massachusetts Institute of Technology. He is also an active Certified Public Accountant (CPA) in the State of California.

Kathy Hibbs

Ms. Hibbs is our Chief Administrative Officer and Secretary. She previously served as our Chief Legal and Regulatory Officer and Secretary from June 2021 to February 2022 and as the Chief Legal and Regulatory Officer of 23andMe, Inc. from 2014 to June 2021. Previously, Ms. Hibbs served as Senior Vice President and General Counsel of Genomic Health, Inc., a genetic research and cancer diagnostics company, from 2009 to 2014. Prior to that, from 2000 to 2009, Ms. Hibbs served as Senior Vice President and General Counsel of Monogram Biosciences Inc., and from 1995 to 1999, she was the Director of Legal Affairs at Varian Associates, Inc. followed by its successor, Varian Medical Systems, Inc. Ms. Hibbs served on the board of directors of Decipher Biosciences, Inc. (Nasdaq: DECI) until its acquisition. She also serves as a member of the Fast Company Impact Council and as a member of the board of directors of Cadex Genomics, Corp., a private company focused on molecular diagnostics tests to guide cancer treatment, and the board of directors of Sophia Genetics, a private Al platform company whose products are used by more than 1,000 healthcare institutions. Ms. Hibbs also currently serves as the Chair of the Compensation Committee of Sophia Genetics. Ms. Hibbs received her B.A. in Political Science from the University of California, Riverside, and her J.D. from the University of California, Hastings College of the Law.

Kenneth Hillan

Dr. Hillan is our Chief Therapeutics Officer. Dr. Hillan previously served as our Head of Therapeutics from June 2021 to February 2022 and as the Head of Therapeutics of 23andMe, Inc. from 2019 to June 2021. Previously, he served as the Chief Executive Officer of Achaogen, Inc. (“Achaogen”) from 2011 to 2019. Prior to that, from 1994 to 2011, he held progressively senior roles at Genentech,

 

Inc., most recently serving as Senior Vice President and Head of Clinical Development and Product Development Strategy Asia-Pacific from 2010 to 2011 and Vice President, Tissue Growth and Repair, Product Development from 2006 to 2010. Dr. Hillan currently serves on the boards of directors of Sangamo Therapeutics, Inc. (Nasdaq: SGMO) and Zymeworks Inc. (NYSE: XYME).

He previously served on the boards of directors of Achaogen and Relypsa, Inc. (until it was acquired by Galenica AG in 2016). He holds an M.B. Ch.B. (Bachelor of Medicine and Surgery) degree from the Faculty of Medicine at the University of Glasgow, United Kingdom. He is a Fellow of the Royal College of Surgeons (FRCS, Glasg), and a Fellow of the Royal College of Pathologists (FRCPath). He has authored dozens of scientific publications and is a named inventor on almost 50 issued patents.

 

Director Compensation

The Board believes that compensation paid to our non-employee directors should (i) be competitive with our industry peers of comparable size and (ii) enable us to attract and retain individuals of the highest quality to serve as our directors. To align director interests with the long-term interests of our stockholders, non-employee directors receive a combination of cash and equity-based compensation for their service. Officers of the Company who are also directors do not receive any additional compensation for services rendered as a director.

Non-Employee Director Compensation Program

The Board, in consultation with Compensia, Inc. (“Compensia”), periodically reviews the Company’s non-employee director compensation program (as amended, the “Non-Employee Director Compensation Program”). After taking into consideration feedback from Compensia tied to its development of a Board compensation assessment covering the practices at the Company’s industry peers, the Board approved certain changes to the Non-Employee Director Compensation Program for Fiscal 2023, with such changes to be effective as of the 2022 Annual Meeting of Stockholders. With respect to the cash retainers, the Board approved the following changes (collectively, the “Fiscal 2023 Director Cash Compensation Changes”):

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Increasing the Board Annual Cash Retainer from $40,000 to $50,000;

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•

Increasing the Board Committee Annual Cash Retainer for Compensation Committee members from $7,000 to $7,500; and

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•

Increasing the Board Committee Annual Cash Retainer for the Compensation Committee chair from $14,000 to $15,000.

​

Accordingly, as a result of the Fiscal 2023 Director Compensation Changes, beginning as of the 2022 Annual Meeting of Stockholders, each non-employee director is eligible to receive annual cash retainers for their service on the Board and the Board’s committees (collectively, “Annual Board and Committee Fees”) as follows:

In addition, we reimburse reasonable expenses incurred by our non-employee directors in connection with attendance at Board or committee meetings. There are no per meeting attendance fees for attending Board meetings. The Annual Board and Committee Fees were paid quarterly, in arrears, for calendar quarters ended on or before June 30, 2022. Thereafter, the Annual Board and Committee Fees will be paid in a single payment as soon as administratively practical following each annual meeting of stockholders and will compensate each non-employee director for service through the date of the next annual meeting of stockholders.

Non-employee directors may elect on an annual basis to receive their Annual Board and Committee Fees in the form of RSUs, in accordance with the terms of the 23andMe Holding Co. RSU Conversion and Deferral Program for Directors (the “Deferral Program”).

In addition to cash retainers, under the Non-Employee Director Compensation Program, each non-employee director is entitled to an annual equity award of RSUs (the “Annual Award”), as well as an initial equity award of RSUs in connection with a non-employee director’s appointment to the Board (the “Initial Award”). The Annual Award is made following the Company’s annual meeting of stockholders, and the Initial Award is granted on or as soon as reasonably practicable following the commencement date of such director service on the Board. In addition to the Fiscal 2023 Director Cash Compensation Changes, in consultation with Compensia, the Board approved increasing the Annual Award from $175,000 to $220,000 (the “Fiscal 2023 Equity Compensation Change”). Accordingly, as a result of the Fiscal 2023 Equity Compensation Change, beginning as of the 2022 Annual Meeting of Stockholders, the equity compensation under the Non-Employee Director Compensation Program consisted of the following:

 

Each Annual Award vests in full on the earlier of  (a) the first anniversary of the date of grant or (b) the date of the subsequent year’s annual meeting of stockholders. Each Initial Award vests in full on the first anniversary of the date of grant; provided that any Initial Awards granted on or before December 31, 2021, vested in full on June 16, 2022. The vesting of all equity awards is subject to the non-employee director’s continued service to the Company through the date of vesting and the terms of the related award agreement. Notwithstanding the foregoing, all Annual Awards, Initial Awards, and Converted RSUs (as defined below) outstanding immediately prior to the effectiveness of a Change of Control (as defined in the 23andMe Holding Co. 2021 Incentive Equity Plan) shall be deemed to be vested and exercisable upon the effectiveness of such Change of Control.

Non-employee directors may elect to defer their Initial Award and/or Annual Award, or any RSUs awarded as a result of the director’s election to receive his or her Annual Board and Committee Fees in the form of RSUs (such RSUs, the “Converted RSUs”), in accordance with the Deferral Program.

Director Compensation Table

The following table summarizes the compensation paid to, awarded to, or earned by each individual who served as a non-employee director of the Company at any time during Fiscal 2023 for service on the Board.

​

(1)

Anne Wojcicki is not included in the table above since, as an officer of the Company, she receives no compensation for her services as a director of the Company. Ms. Wojcicki’s compensation is reflected in the “Summary Compensation Table” beginning on page 50 of this Proxy Statement.

​

(2)

Mr. Lovell served as a Class III director for the entirety of Fiscal 2023; however, he passed away in June 2023. Pursuant to policies of his employer, Mr. Lovell was unable to accept any compensation for his Board service.

​

(3)

The Annual Board and Committee Fees were paid quarterly, in arrears, for calendar quarters ended on or before June 30, 2022. Thereafter, the Annual Board and Committee Fees began being paid in a single payment as soon as administratively practical following each annual meeting of stockholders. Accordingly, fees earned or paid in cash during Fiscal 2023 consisted of the following two payments: (1) a quarterly payment made following the conclusion of the quarter ended June 30, 2022; and (2) an annual payment following the conclusion of the 2022 Annual Meeting of Stockholders.

​

(4)

The following directors elected to receive RSUs in lieu of cash fees:

​

(a) Director elected to defer receipt of such RSUs.

(5)

Each of the directors were granted an Annual Award of RSUs covering 57,755 shares of Class A common stock on August 25, 2022, based on a grant date fair value of  $3.86, as well as an additional grant of RSUs covering 14,633 shares of Class A common stock on September 6, 2022, based on a grant date fair value of  $3.22. The September 6, 2022 grant was related to the Fiscal 2023 Equity Compensation Change. The award grant date fair values shown in the table have been determined in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 718, using the assumptions described in Note 14 to 23andMe’s Consolidated Financial Statements, which is included in our Annual Report.

​

 

As of March 31, 2023, each non-employee director held:

​

(6)

As discussed on page 30 of this Proxy Statement, during Fiscal 2023, the Company paid Dr. Scheller $120,000 pursuant to the Consulting Agreement.

​

 

PROPOSAL 2

Non-Binding, Advisory Vote on the Named Executive Officer Compensation for Fiscal 2023 (“Say-on-Pay” Vote)

This proposal, commonly known as a “Say-on-Pay” proposal, gives the Company’s stockholders the opportunity to express their views on the compensation of its named executive officers in accordance with Section 14A of the Exchange Act. This vote is not intended to address any specific item of compensation, but rather the overall compensation of our named executive officers and the Company’s compensation philosophy, policies, and practices described in this proxy statement.

Accordingly, the Board invites you to review carefully the Compensation Discussion and Analysis and the tabular and other disclosures under the caption “Executive Compensation” below, and cast a vote in favor of the compensation paid to our named executive officers in Fiscal 2023 and adopt the following resolution:

“RESOLVED, that the stockholders approve the compensation of the Company’s named executive officers for Fiscal 2023, as discussed and disclosed pursuant to Item 402 of Regulation S-K, including the Compensation Discussion and Analysis, the executive compensation tables, and any related material disclosed in this proxy statement.”

The Say-on-Pay vote is advisory, and therefore, is not binding on the Company, the Compensation Committee, or the Board. The Board and the Compensation Committee value the opinions of the Company’s stockholders and, to the extent that any significant vote against the named executive officer compensation occurs, the Board will consider the stockholders’ concerns and the Compensation Committee will evaluate whether any actions are necessary to address those concerns. However, neither the Board nor the Compensation Committee will have any obligation to take any action as a result of the Say-on-Pay vote.

The Board has adopted a policy providing for annual say-on-pay advisory votes. Unless the Board modifies the Company’s policy, the next say-on-pay advisory vote will be held at our 2024 Annual Meeting of Stockholders and the next say-on-frequency advisory vote will be held at our 2028 Annual Meeting of Stockholders.

 

Compensation Discussion and Analysis

This Compensation Discussion and Analysis provides important information on our executive compensation program and on the amounts shown in the executive compensation tables that follow. In this Proxy Statement, the term “named executive officers” or “NEOs” means the individuals named in the executive compensation tables that follow and who are listed below.

​

(1)

Mr. Selsavage was appointed Interim Chief Financial and Accounting Officer effective September 1, 2022.

​

(2)

Mr. Johnson ceased to serve as the Company’s Chief Operating Officer, Consumer and as an executive officer of the Company in August 2022; however, Mr. Johnson continued to be an employee of the Company for the entirety of Fiscal 2023.

​

(3)

Mr. Schoch ceased to serve as the Company’s Chief Financial Officer and be employed by the Company on September 1, 2022.

​

EXECUTIVE SUMMARY

Fiscal 2023 Business Highlights

23andMe had a productive year with numerous accomplishments for both our Consumer and Therapeutics businesses. Since starting the Company, 23andMe’s mission hasn’t changed, with a focus to help individuals access, understand, and benefit from the human genome. Below are some of the impactful highlights from Fiscal 2023.

Consumer

The Company continued to add new reports for 23andMe+ members and launched a collaboration with Novartis for disease awareness.

•

The Company launched 11 new 23andMe+ member-exclusive reports in Fiscal 2023, offering insights into a person’s genetic likelihood of developing certain conditions such as lupus, anxiety, and asthma. These reports are developed by 23andMe scientists using data and insights gathered from thousands of customers who have consented to participate in our research.

​

•

The Company began offering genetic report consultations with a Lemonaid Health clinician that can help customers better understand the potential impact of their genetic risk profile and discuss potential next steps.

​

•

The Company received FDA clearance to provide interpretive drug information for simvastatin, a commonly prescribed cholesterol medication to treat high cholesterol and triglyceride levels. With this clearance, 23andMe now has three FDA-cleared pharmacogenetics reports. These reports are some of the most highly actionable genetic reports, providing information on how individuals may process certain commonly prescribed medications based on their genetics.

​

•

The Company announced a collaboration with Novartis Pharmaceuticals Corporation to increase awareness for Lipoprotein(a) (“Lp(a)”). High levels of Lp(a) are associated with increased risk of heart attack, stroke, and other life-threatening conditions. The level of Lp(a) is almost entirely determined by genes and is unrelated to diet, exercise, or obesity, creating the need for greater awareness.

​

Therapeutics

The Company continued to progress its wholly-owned 23ME-00610 program in the clinic.

•

The Company dosed the first patient in the Phase 2a portion of its Phase 1/2a study evaluating the anti-tumor activity of the 23ME-00610 monotherapy in a number of previously disclosed expansion cohorts. Dosing will be at 1400mg

​

 

intravenously every three weeks based on Phase 1 data. The Phase 2a portion of the study will further characterize the safety, tolerability, pharmacokinetic, and pharmacodynamic profile of 23ME-00610.

Corporate

The Company added to its experienced leadership team and published its first ESG report.

•

The Company appointed Daniel Chu as Chief Product Officer in September 2022 to focus on building its genetically informed health services and features focused on prevention and wellness. Chu joined 23andMe from Waymo, bringing over two decades of experience in product management, design, and strategy, as well as expertise with navigating complex and highly regulated industries.

​

•

The Company published its inaugural ESG report that outlines the Company’s strategy and initiatives to ensure ethical management, promote a diverse and equitable culture, and implement sustainable business operations.

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Fiscal 2023 Compensation Program Elements

The following table summarizes the compensation elements provided to our NEOs in Fiscal 2023:

​

(1)

Except as discussed below, the Compensation Committee did not grant annual long-term equity awards to any of the NEOs during Fiscal 2023.

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Pay-for-Performance Compensation Model

We are committed to aligning the outcomes of our executive compensation programs with the Company’s performance and creation of long-term stockholder value. In June 2022, the Compensation Committee adopted the Annual Incentive Plan (as amended and restated, the “AIP”), pursuant to which, beginning with Fiscal 2023, the NEOs were eligible to receive annual incentive bonuses in the form of restricted stock units (“RSUs”), based upon the Company’s achievement of certain pre-established financial, operational, and strategic performance metrics during the one-year performance period ended March 31, 2023. The Compensation Committee believes that the AIP serves as an important element of the Company’s executive compensation program, as the opportunity to earn variable, at-risk compensation will motivate and reward NEOs for achieving annual financial, operation, and strategic results. Moreover, the adoption of the AIP represents the Compensation Committee’s commitment to a pay-for-performance compensation model.

For Fiscal 2023, our CEO’s compensation consisted only of minimal cash compensation. Specifically, Ms. Wojcicki only received $62,920 in order to comply with California’s minimum salary laws. She did not receive any long-term equity awards; nor did she participate in the AIP for Fiscal 2023. Except with respect to Mr. Selsavage’s equity awards, our other NEOs’ Fiscal 2023 compensation consisted primarily of fixed cash compensation (base salary) and variable compensation (RSUs awarded under the Fiscal 2023 AIP).

Say-on-Pay Results and Stockholder Feedback

In accordance with Instruction 4 to § 240.14A-21, which provides that a company that loses its emerging growth company status within two years of its initial public offering may postpone its initial say-on-pay vote until the third year following its initial public offering, we did not ask our stockholders to vote on a non-binding, advisory basis on the Fiscal 2022 compensation paid to our named executive officers at the 2022 Annual Meeting of Stockholders. Accordingly, as discussed in Proposal 2, we are conducting our first

 

Say-on-Pay vote at the Annual Meeting. Thereafter, the Board and the Compensation Committee will review and consider the outcome of the 2023 “Say-on-Pay” vote in designing our executive compensation program and determining executive compensation going forward.

Additionally, we are committed to engaging in active and ongoing dialogues with our stockholders and take stockholder feedback into consideration when reviewing and structuring our executive compensation programs.

EXECUTIVE COMPENSATION PHILOSOPHY, OBJECTIVES, AND HIGHLIGHTS

Key Objectives of the Compensation Program

We design our executive compensation program to (i) allow us to attract and retain highly qualified executive officers, and (ii) allow these executive officers the opportunity to own a portion of the Company. We believe that our ability to ensure that our executive officers are engaged and productive depends upon how we structure our compensation program. In addition, for us to be appropriately positioned to attract new talent, we must be prepared to be, and be perceived as, an employer that offers competitive compensation. We believe that providing our executive officers an opportunity to be partial owners in our business fosters their active engagement in our success, strengthens our retention objectives, and aligns their long-term interests with those of our stockholders. Consistent with this philosophy, we have designed our executive compensation program to achieve the following primary objectives:

•

attract and retain highly qualified, experienced executive officers who can make significant contributions to our long-term business success;

​

•

reward executive officers for achieving business goals and delivering strong performance; and

​

•

align executive incentives with stockholder value creation.

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Executive Compensation Best Practices

We are committed to developing an executive compensation program that reflects best practices and reinforces the Company’s culture and values. The following compensation practices demonstrate how we believe our executive compensation program reflects best practices:

​	​	What We Do	​	​
​	​	Maintain an independent Compensation Committee ​	​	​
​	​	Retain an independent compensation consultant ​	​	​
​	​	Conduct an annual executive compensation review with benchmarks derived from a reasonable set of similar-industry peer companies ​	​	​
​	​	Emphasize “at-risk” or variable compensation, including the implementation of a bonus program for NEOs in Fiscal 2023 ​	​	​
​	​	Establish multi-year vesting requirements ​	​	​
​	​	Maintain double-trigger change-of-control arrangements ​	​	​
​	​	Conservative compensation risk profile ​	​	​

​	​	What We Don’t Do	​	​
​	​	Excise tax gross-up payments ​	​	​
​	​	Derivatives or hedging of equity securities ​	​	​
​	​	Pledging of equity securities ​	​	​
​	​	Multi-year employment agreements with NEOs ​	​	​
​	​	Stock option repricing without stockholder approval ​	​	​
​	​	Executive retirement plans ​	​	​
​	​	Excessive perquisites ​	​	​
​	​	Excessive executive severance rights or single-trigger change-of-control arrangements ​	​	​

 

DETERMINATION OF EXECUTIVE COMPENSATION

Following the Business Combination, the Compensation Committee was charged with the responsibility of determining and administering the Company’s executive compensation program, as discussed below.

Role of the Compensation Committee

Our Board has delegated authority to the Compensation Committee to oversee and approve the overall compensation program for our executive officers. In making its decisions, the Compensation Committee takes into consideration a variety of factors, including the recommendations of management and the independent compensation consultant. The Compensation Committee has the authority to exercise discretion with respect to executive compensation awards and performance metrics and may authorize adjustments to targets and/or awards as it deems necessary or appropriate.

Role of Executive Officers

Our Chief Executive Officer, Ms. Wojcicki, provides input and makes recommendations to the Compensation Committee regarding our executive compensation program. She also reports to the Compensation Committee on individual NEO performance and provides recommendations regarding each NEO’s compensation (except with respect to her own compensation).

At the invitation of the Compensation Committee, Ms. Wojcicki may attend the Compensation Committee’s meetings; however, she does not attend any Compensation Committee meetings when her own compensation is being discussed or determined. The Company’s other executive officers and members of senior management also periodically attend meetings to present information, participate in discussions, and answer questions related to our executive compensation plans. No executive officer participates directly in the final deliberations and decisions regarding his or her own compensation. The Compensation Committee considers management’s recommendations and exercises independent judgment in making any final decisions to approve NEO compensation.

Role of Compensation Consultant

As provided in its charter, the Compensation Committee has the sole authority to hire, terminate, and approve fees for compensation consultants, outside legal counsel, and other advisors as it deems necessary to assist in the fulfillment of its responsibilities. The Compensation Committee retained Compensia, a management consulting firm, as its independent compensation consultant for Fiscal 2023. Compensia provides research, market data, survey, proxy information, and design expertise in developing executive and director compensation programs. As requested by the Compensation Committee, Compensia provided the Compensation Committee with market data from proprietary surveys and databases and publicly available information to consider when making compensation decisions for the NEOs.

The primary Compensia executive compensation consultant attended several of the Compensation Committee meetings in Fiscal 2023 and advised the Compensation Committee on principal aspects of executive compensation, including the competitiveness of program design and award values and specific analyses for the NEOs and other executive officers. Compensia reports directly to the Compensation Committee, and the Compensation Committee reserves the right to replace the independent compensation consultant or hire additional consultants or advisers at any time. The Compensation Committee reviewed its relationship with Compensia and determined that there are no conflicts of interest pursuant to applicable SEC and Nasdaq requirements. Compensia did not provide any additional services unrelated to executive or director or broader equity strategy compensation consulting to the Company in Fiscal 2023.

Compensation Benchmarking and Setting Executive Compensation

Generally, the Compensation Committee targets NEO pay within the peer market range, subject to adjustment based on the Compensation Committee’s assessment of the Company’s and the NEO’s performance. The criteria used to select companies for the Fiscal 2023 proxy peer group (the “Peer Group”) included:

•

Public Ownership — Public companies headquartered in the U.S. only (job scope and pay models are typically different at private companies, and private companies generally do not publicly disclose executive compensation)

​

 

•

Industry — Typically reflects potential labor market competition and jobs of similar scope; peers generally reflect biotechnology, healthcare technology, healthcare services, life sciences tools and services, and healthcare equipment companies identified by the Company as key industry competitors, with a focus on companies that are consumer-oriented and have technology-enabled products or services

​

•

Revenue — Peers generally align between 0.5x and 2.0x our revenue at the time of our annual peer group update

​

•

Market Capitalization — Peers generally align between 0.25x and 4.0x our market capitalization at the time of our annual peer group update

​

•

Secondary Factors — Screened for companies that are category definers, consumer-focused, tech-enabled product based, or services with healthcare technology focus, comparable in stage/time from initial public offering, based in California, and/or identified as key labor competitors (particularly at the executive level)

​

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

​

(1)

The Fiscal 2023 Proxy Peer Group included the same peer companies as the Fiscal 2022 Proxy Peer Group. As such, no peer companies were added to or removed from the Fiscal 2022 Proxy Peer Group.

​

For Fiscal 2023, the compensation paid to the NEOs was reviewed relative to compensation paid by the Peer Group to named executive officers of similar title and responsibility. By reviewing this information, as summarized for the Compensation Committee by Compensia, the Compensation Committee was able to analyze the market competitive pay for each NEO position. The Compensation Committee reviews each NEO’s compensation relative to the other NEOs, taking into account each NEO’s scope of tenure, existing equity holdings, responsibility, performance, and impact on our business results.

Additionally, there are several qualitative factors that are considered when assessing the reasonableness and competitiveness of the NEO compensation beyond benchmarked industry data. Other factors that are considered include:

•

Each NEO’s skills, experience, and tenure;

​

•

The NEO’s role and level of responsibility and influence to further the Company’s success against objectives and strategy;

​

•

Internal pay equity considerations;

​

•

Existing equity holdings and the strength of forward-looking retention;

​

•

NEO and overall team performance assessed by the CEO (aside from her own, which is assessed by the Compensation Committee); and

​

•

The competitive market for each NEO’s executive position and role, the cost and disruption to the business if such NEO would need to be replaced, and the scope and skills required of the role.

​

BASE SALARY

Base salaries are intended to provide a fixed component of cash compensation sufficient to attract and retain an effective management team, when considered in combination with the other components of the executive compensation program. In general, we seek to provide a base salary level designed to reflect each NEO’s position and scope of responsibility and accountability.

 

The Compensation Committee annually reviews the base salaries of the NEOs. The base salaries of the NEOs are determined based upon the individual NEO’s current base salary, job responsibilities, tenure, internal pay equity considerations, role in executing business strategy, individual performance, the competitive market for the NEO’s role, and base salaries for comparable positions within the Peer Group. Based on the foregoing considerations, on February 9, 2022, the Compensation Committee approved certain merit-based increases to the base salaries of Messrs. Schoch and Johnson, Dr. Hillan, and Ms. Hibbs; such increases were effective March 1, 2022 (i.e., during Fiscal 2022). Except as noted below, there are no changes to the NEOs’ base salaries during Fiscal 2023.

In light of her equity interests in the Company, Ms. Wojcicki historically has received base salary compensation significantly lower than that of the other NEOs. Base salaries in effect during Fiscal 2023 are shown in the table below: