The Corporate Rundown

Michael Kors

The Board of Directors and Committee  

The board members at Michael Kors include Michael Kors, John D.Idol, William Benedetto, Robin Freestone, Judy Gibbons, Ann McLaughlin, Stephen Reitman, and Jean Tomlin. The board is properly constituted and ensures proper gender representation with 5 males and four female. The board members are qualified and have enough experience thereby justifying their presence in the board of directors.

Michael Kors serves the position of an Honorary Chairman and the Chief Creative Officer as well as a director. Mr. Kors bears an education background in fashion design from The Fashion Institute of Technology in Manhattan. In 1981, he founded the Michael Kors Holdings that has turned to be an iconic luxury business empire well known for its unique perspective and the global diversification. His first runway show was displayed in 1984 marking the beginning of an era where Kors has succeeded in creating a global luxury lifestyle brand. His contributions and efforts have been awarded through many industry award such as the CFDA women swear Designer in 1999, Menswear Designer in 2003, The Accessories Council ACE Award in 2006 and Fashion group International’s Star Honoree in 2009, Lifetime Achievement Award in 2010 and Award of Courage from amfAR 2011. His education background and enthusiasm in fashion design makes whim well suited for being the Chief Creative Officer (Michael Kors, 2015).

John Idol serves as the Chairman, CEO and director. He has occupied the position of chairman since September 2011 and that of CEO and director from 2003. He was a former chairman and CEO at Kasperr ASL Ltd for two years up to July 2003. He also previously served in the capacity of CEO and director at International Inc. Prior thereto from 1997 up to 2001. Between 1994 to 1997 he held the position of Ralph Lauren’s Group President and a CEO of Product licensing, Home Collection. His vast experience of more than 20 years in executive positions makes him a suitable board member as well as the company’s CEO (Michael Kors, 2015).

William Benedetto, the lead director has occupied the position of a director as from December 2011 and lead director from July 2014. He is also in charge of the Audit Committee as well as a member of the Compensation and Talent Committee. He has been a cofounder and chairman of a boutique investment bank from 1988 where the company dealt with generating capital for private equity firms and offering extensive investment banking. His experience ad orientation on the financial matters makes him a crucial board member. 

Director Robin Freestone has been a director since November 2016 and further serves in the Audit Committee and Compensation and Talent Committee. He has served in position critical to financial management with companies such as Pearson Plc., Amersham, Henkel Chemicals UK Ltd, and Syngenta. His financial and accounting career broke its ice at Touché Ross well known now as Deloitte. The experience in the financial sector of Mr. Freestone makes him well suited and a key pillar to the board of Michael Kors. His membership to the Audit Committee is also justified.

Judy Gibbons has been a director with the company since November 2002 where she serves in the Audit Committee and the Governance and Nominating Committee. She has held previous positions as a partner and board member at Accel Partners and deal at with seed capital investments for mobile applications, digital advertising, e-commerce and social media. She further had occupied the position of Corporate Vice President at Microsoft where she handled international roles. She also held executive positions at Apple Inc. and HP. With her vast experience inn executive management environment and the international business environment, she is justified to be a member of the board and director at Michael Kors.

Ann McLaughlin is a director of the company since 2013 and chairs the Governance and Nominating Committee in tip of being Compensation and Talent Committee. She also has extensive experience in executive management form different companies making her a capable board member (Michael Kors, 2015).

Stephen Reitman plays the role of a director at Michael Kors and a member of Audit committee and the Governance Committee. He has experience serving as a board member with Ladies Wear Company in Canada from 1984. He has served as CEO and Executive Vice President at Reitman’s. He also occupied the seat of president and CEOP at Simone Perel I Canada Ltd. His vast experience as a business leader makes Mr. Reitman an important board member (Michael Kors, 2015).

Jane Thompson serves as a director of the company, a position she has held since January 2015. She also serves as a member of Audit Committee and the Compensation and Talent Committee. She has previously held senior positions with companies such as LLC, IACI, The Fusion labs. She holds an MBA from Wharton School from the University of Pennsylvania.

Jean Tomlin has been a director with the company since March 2013. She makes contributions as the chair of Compensation and Talent Committee and a member of the Governance and Nominating Committee. She has vast experience in the human resource management. With this orientation, Jean plays a significant role to the company and well suited for the committees which she is a member (Michael Kors, 2015).

Executive compensation

The company makes compensation to the executive as per the SEC disclosure rules that include the grant fair value of share awards and option awards. The top executives are compensated as per their employment contracts. With Michael Kors, the company re-negotiated the employment agreement which entitled him to an annual salary of $1.o million and other bonus as may be approved by shareholders. John Idol also has renegotiated terms that offers him an annual salary of $1.0 million and other allowances. Joseph Parsons Salary offers him an annual base of $600000 and other annual bonus. Ms. Robinson receives $450000 annual base salary and other bonus as per the terms. Meyran earns a basic salary of $ 500,000 and subjected to other bonus schemes (Michael Kors, 2015).

The Michael Kors Holdings provides Executive Bonus Program with an aim of attracting, retaining and motivating these crucial employees occupying senior positions in the company and other specific affiliated entities which collectively makes up the company. The bonus program offers competitive cash performance rewards to attain and going beyond the Company business objectives. The compensation philosophy for the company is justified with regard to the financial performance of the company. The compensation has helped attract these executive managers with vast experience thereby important reward them appropriately (Michael Kors, 2017).

The executive bonus is offered as a percentage of the annual base salary with the size defined by divisional and corporate performance. The performance measurement is calculated based on successful attainment of operating goals for every division and general company performance. To enhance teamwork and cooperation, every executive members target incentive is pegged to the overall corporate performance. Whenever the company makes unbudgeted operating loss, no bonuses are pad despite the performance of the division. Where budgeted loss occurs above $2 million, no bonuses are paid (Michael Kors, 2017).

CEO Compensation Metrics

The CEO is offered annual salary amounting to $1 million. The bonus earned by the CEO is subjected to the approval of the shareholders under the Amended and Restated Omnibus Incentive Plan. The CEO is expected to receive cash bonus based on the performance of the company offering him 1% of the EBITDA up to the second quarter and not exceeding $1.5 million. In respect to the fiscal year, the CEO is entitled to a 1% of EBITDA for the period under consideration and not beyond $6.5 million (Michael Kors, 2015). The amount may be reduced in the instance where the Compensation Committee determines that the CEO was overpaid as a result of restatements in the financial statements or non-compliance reporting where such an error is identified within a period of three years from making the payout. The CEO further enjoys all the employee benefits plans and programs availed for senior managers. The company pays up premiums of the CEO of up to $50000 annual and a life insurance policy of %5 million. The CEO is provided with a company car and driver for official business as per the employment contract. The company reported a net income of $839.1 million for the fiscal year 2016 (Michael Kors, 2015). With such financial performance, it is thereby justifiable and reasonable to compensate the CEO on such metrics.

Transactions with Related Parties

The company maintains a written related person transactions policy that guides the policy with respect to review, approval, and ratification of some related transaction, a role charged to the Audit Committee. The policy defines a “related party transaction” as a transaction, arrangement, or relationship carried out with a participant and of amount beyond $120000 and has a direct or indirect material interest. The policy requires a policy be provided to the legal department before entering in the transaction from where it is submitted to the Audit Committee the audit committee may approve as per the best interests of the company and the shareholders (Michael Kors, 2015). 

Michael Kors Holdings Limited operates some transactions with related parties. One of such agreements is the shareholders agreement entered with some shareholders including Sportswear Holding limited, directors Silas, Lawrence Stroll, Michael Kors and John Idol. The agreement involves shareholders with a minimum of 5% of outstanding ordinary shares and holds a demand right to ask for a registration under Security Act for their registration at the expense of the company. Other shareholders must be notified of intention to carry out the Demand Registration. 

The Michael Kors Far East Holdings entered into agreements termed as Far East Licensing Agreements with some subsidiaries offering some exclusive rights in China, Hong Kong, Macau and Taiwan with regard to importing, selling, distribution, advertise and promote the products these agreements are meant to expire in 2041 but may terminated if the sale targets are not achieved in certain intervals (Michael Kors, 2015).


Michael Kors. (2015). Proxy Statements Pursuant to Section 14(a) OF TEH Security Exchange Act of 1934. Retrieved from

Michael Kors. (2017). Executive Bonus Program. Retrieved from

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