March 7, 2022

Michael D. Hsu

Chairman of the Board and
Chief Executive Officer

FELLOW STOCKHOLDERS:

It is my pleasure to invite you to the Annual Meeting of Stockholders of Kimberly-Clark Corporation. The meeting will be held virtually on Wednesday, April 27, 2022, at 9:00 a.m. Central Time.

At the Annual Meeting, stockholders will be asked to elect thirteen directors for a one-year term, ratify the selection of Kimberly-Clark’s independent auditor, and approve the compensation for our named executive officers. These matters are fully described in the accompanying Notice of Annual Meeting and proxy statement.

Your vote is important. Regardless of whether you plan to attend the meeting, I urge you to vote your shares as soon as possible. You may vote using the proxy form by completing, signing, and dating it, then returning it by mail. Also, most of our stockholders can submit their vote by telephone or through the Internet. If telephone or Internet voting is available to you, instructions will be included on your proxy form. Additional information about voting your shares is included in the proxy statement.

Sincerely,

Notice of Annual Meeting of Stockholders

TO BE HELD

April 27, 2022

VIA

live webcast at https://meetnow. global/MJW2GVW

The Annual Meeting of Stockholders of Kimberly-Clark Corporation will be held virtually on Wednesday, April 27, 2022, at 9:00 a.m. Central Time for the following purposes:

Due to the public health impact of the ongoing COVID-19 pandemic and to support the health and well-being of our employees, stockholders, and our community, the 2022 Annual Meeting will be virtual and will be held entirely online via live webcast at https://meetnow.global/MJW2GVW. There will not be an option to attend the meeting in person. Please see “Attending the Virtual Annual Meeting” for more information.

Stockholders also will take action upon any other business that may properly come before the meeting.

Stockholders of record at the close of business on February 28, 2022 are entitled to notice of and to vote at the meeting or any adjournments. It is important that your shares be represented at the meeting. I urge you to vote promptly by using the Internet or telephone or by signing, dating and returning your proxy form in the envelope provided.

The accompanying proxy statement also is being used to solicit voting instructions for shares of Kimberly-Clark common stock that are held by the trustees of our employee benefit and share purchase plans for the benefit of the participants in the plans. It is important that participants in the plans indicate their preferences by using the Internet or telephone or by signing, dating and returning the voting instruction card, which is enclosed with the proxy statement, in the envelope provided.

To attend the meeting, please register by following the instructions on page 94.

Alison M. Rhoten, Vice President, Deputy
General Counsel, Global Corporate Affairs
and Corporate Secretary

Important Notice Regarding the Availability of Proxy Materials for the Stockholder Meeting to be Held on April 27, 2022:The Proxy Statement and proxy card, as well as our Annual Report on Form 10-K for the year ended December 31, 2021, are available at https://www.kimberly-clark.com/investors.

Our governance structure and processes are based on a number of important governance documents including our Code of Conduct, Certificate of Incorporation, Corporate By-Laws, Corporate Governance Policies and our Board Committee Charters. These documents, which are available in the Investors section of our website at www.kimberly-clark.com, guide the Board and our management in the execution of their responsibilities.

Kimberly-Clark believes that there is a direct connection between good corporate governance and long-term, sustained business success, and we believe it is important to uphold sound governance practices. As such, the Board reviews its governance practices and documents on an ongoing basis, considering changing regulatory requirements, governance trends and issues raised by our stockholders. After careful evaluation, we may periodically make changes to maintain or enhance current governance practices and promote stockholder value.

Board Leadership Structure

The Board has established a leadership structure that allocates responsibilities between our Chairman of the Board and CEO and our Lead Director. The Board believes that this allocation provides for dynamic Board leadership while maintaining strong independence and oversight.

Consistent with this leadership structure, at least once a quarter our Lead Director, who is an independent director, chairs executive sessions of our non-management directors. Members of our senior management team do not attend these sessions.

Chairman and CEO Positions

The Board’s current view is that a combined Chairman and CEO position, coupled with a predominantly independent board and a proactive, independent Lead Director, promotes candid discourse and responsible corporate governance. Mr. Hsu serves as Chairman of the Board and CEO. The Board believes Mr. Hsu has demonstrated the leadership and vision necessary to lead the Board and Kimberly-Clark. Accordingly, Mr. Hsu serves in this combined role at the pleasure of the Board without an employment contract. As Mr. Hsu is not an independent director, the Board continues to believe it is appropriate for the independent directors to elect an Independent Lead Director.

Lead Director

Mr. White has served as Independent Lead Director since April 2020. Our Corporate Governance Policies outline the significant role and responsibilities of the Lead Director, which include:

	Chairing the Executive Committee
	Chairing executive sessions at which non-management directors meet outside management’s presence, and providing feedback from such sessions to the CEO
	Coordinating the activities of the Independent Directors
	Providing input on and approving the agendas and schedules for Board meetings
	Leading (with the Chairman of the Nominating and Corporate Governance Committee) the annual Board evaluation

Director Independence

Our By-Laws provide that a majority of our directors must be independent (“Independent Directors”). We believe our independent board helps ensure good corporate governance and strong internal controls.

Our Corporate Governance Policies, as adopted by the Board, provide independence standards consistent with the rules and regulations of the SEC and the listing standards of the New York Stock Exchange (“NYSE”). Our independence standards can be found in Section 7 of our Corporate Governance Policies.

The Board has determined that all directors and nominees, except for Michael D. Hsu, are Independent Directors and meet the independence standards in our Corporate Governance Policies. In addition, the Board previously reviewed the independence of former director Abelardo E. Bru, who did not stand for re-election at our 2021 Annual Meeting, and found that Mr. Bru was also independent.

The NYSE listing standards and our own Corporate Governance Policies establish certain levels at which transactions are considered to have the potential to affect a director’s independence. Under our Corporate Governance Policies, certain relationships were considered immaterial and therefore were not considered by the Board in determining independence.

Board Meetings

The Board of Directors met six times in 2021. All of the directors attended in excess of 75 percent of the total number of meetings of the Board and the committees on which they served.

All of our directors are encouraged to attend our annual meeting of stockholders. All of our directors attended the 2021 Annual Meeting.

Board Committees

The standing committees of the Board include the Audit Committee, Management Development and Compensation Committee, Nominating and Corporate Governance Committee, and Executive Committee. In compliance with applicable NYSE corporate governance listing standards, the Board has adopted charters for all Committees except the Executive Committee.

Our Committee charters are available in the Investors section of our website at www.kimberly-clark.com.

As set forth in our Corporate Governance Policies, the Audit, Management Development and Compensation, and Nominating and Corporate Governance Committees all have the authority to retain independent advisors and consultants, with all costs paid by Kimberly-Clark.

Audit Committee

The Board has determined that each of Messrs. Maclin and Smucker and Mmes. Mahlan and Shive is an “audit committee financial expert” under SEC rules and regulations. In addition, all Audit Committee members satisfy the NYSE’s financial literacy requirements and qualify as Independent Directors under the rules of the SEC and the NYSE, as well as under our Corporate Governance Policies. See “Corporate Governance - Director Independence” for additional information on Independent Directors.

No member of the Audit Committee serves on the audit committees of more than three public companies and under our Audit Committee Charter, no Committee member is permitted to do so.

During 2021 the Committee met nine times.

The Committee’s principal functions, as specified in its charter, include:

	Overseeing:

		the quality and integrity of our financial statements
		our compliance programs
		the independence, qualification and performance of our independent auditor
		the performance of our internal auditor

	Selecting and engaging our independent auditor, subject to stockholder ratification
	Pre-approving all audit and non-audit services that our independent auditor provides
	Reviewing the scope of audits and audit findings, including any comments or recommendations of our independent auditor
	Establishing policies for our internal audit programs
	Overseeing the company’s risk management program (including risks related to data privacy, cybersecurity, business continuity, IT operational resilience and regulatory matters) and receiving periodic reports from management on risk assessments, the risk management process, and issues related to the risks of managing our business

Committee Report

For additional information about the Audit Committee’s oversight activities in 2021, see “Proposal 2. Ratification of Auditor - Audit Committee Report.”

Management Development and Compensation Committee

Each member of this Committee is an Independent Director under the rules of the SEC and the NYSE, as well as under our Corporate Governance Policies. The Committee met four times in 2021.

The Committee’s principal functions, as specified in its charter, include:

	Establishing and administering the policies governing annual compensation and long-term compensation, including stock option awards, restricted stock awards and restricted share unit awards, such that the policies are designed to align compensation with our overall business strategy and performance
	Setting, after an evaluation of his overall performance, the compensation level of the CEO
	Approving, in consultation with the CEO, compensation levels and performance targets for the senior executive team
	Overseeing:

		leadership development for senior management and future senior management candidates
		a periodic review of our long-term and emergency succession planning for the CEO and other key officer positions, in conjunction with our Board
		key organizational effectiveness and engagement policies

	Reviewing inclusion and diversity programs and related metrics
	Annually reviewing our compensation policies and practices for the purpose of mitigating risks arising from these policies and practices that could reasonably have a material adverse effect

Roles of the Committee and the CEO in Compensation Decisions

Each year, the Committee reviews and sets the compensation of the officers that are elected by the Board (our “elected officers”), including our CEO and our other executive officers. The Committee’s charter does not permit the Committee to delegate to anyone the authority to establish any compensation policies or programs for elected officers, including our executive officers. With respect to officers that have been appointed to their position (our “non-elected officers”), our CEO has the authority to establish compensation programs and to approve equity grants. However, only the Committee may make grants to elected officers, including our executive officers.

Our CEO makes a recommendation to the Committee each year on the appropriate target annual compensation for each of the other executive officers. The Committee makes the final determination of the target annual compensation for each executive officer, including our CEO. While our CEO and Chief Human Resources Officer typically attend Committee meetings, none of the other executive officers is present during the portion of the Committee’s meetings when compensation for executive officers is set. In addition, our CEO is not present during the portion of the Committee’s meetings when his compensation is set.

For additional information on the Committee’s processes and procedures for determining executive compensation, and for a detailed discussion of our compensation policies, see “Compensation Discussion and Analysis.”

Use of Compensation Consultants

The Committee’s charter authorizes it to retain advisors, including compensation consultants, to assist it in its work.The Committee believes that compensation consultants can provide important market information and perspectives that can help it determine compensation programs that best meet the objectives of our compensation policies. In selecting a consultant, the Committee evaluates the independence of the firm as a whole and of the individual advisors who will be working with the Committee.

Independent Committee Consultant. In 2021, the Committee retained Semler Brossy Consulting Group as its independent executive compensation consultant. According to the Committee’s written policy, the independent Committee consultant provides services solely to the Committee and not to Kimberly-Clark. Semler Brossy has no other business relationship with Kimberly-Clark and receives no payments from us other than fees for services to the Committee. Semler Brossy reports directly to the Committee, and the Committee may replace it or hire additional consultants at any time. A representative of Semler Brossy attends Committee meetings and communicates with the Chairman of the Committee between meetings from time to time.

The scope of Semler Brossy’s engagement in 2021 included:

	Conducting a review of the competitive market data (including base salary, annual incentive targets and long-term incentive targets) for our executive officers, including our CEO
	Reviewing and commenting, as requested by the Committee, on recommendations by management and Mercer Human Resource Consulting (“Mercer”) concerning executive compensation programs, including program changes and redesign, special awards, change-of-control provisions, our executive compensation peer group, any executive contract provisions, promotions, retirement and related items
	Reviewing and commenting on the Committee’s report for the proxy statement
	Attending Committee meetings
	Periodically consulting with the Chairman of the Committee

During 2021, at the request of the Committee, a representative of Semler Brossy attended four Committee meetings.

Kimberly-Clark Consultant. To assist management and the Committee in assessing our compensation programs and determining appropriate, competitive compensation for our executive officers, Kimberly-Clark annually engages an outside compensation consultant. In 2021, it retained Mercer for this purpose. Mercer has provided consulting services to Kimberly-Clark on a wide variety of human resources and compensation matters, both at the officer and non-officer levels. During 2021, Mercer provided advice and counsel on various matters relating to executive and director remuneration, including the following services:

	Assessing our executive compensation peer group and recommending changes as necessary
	Assessing compensation levels within our peer group for executive officer positions and other selected positions
	Reviewing historic and projected performance for peer group companies under the metrics we use in our annual and long-term incentive plans
	Assisting in incentive plan design and modifications, as requested
	Providing market research on various issues as requested by management
	Preparing for and participating in Committee meetings, as requested
	Reviewing the Compensation Discussion and Analysis section of the proxy statement and other disclosures, as requested
	Consulting with management on compensation matters

Committee Assessment of Consultant Conflicts of Interest. The Committee has reviewed whether the work provided by Semler Brossy and Mercer represents any conflict of interest. Factors considered by the Committee include: (1) other services provided to Kimberly-Clark by the consultant; (2) what percentage of the consultant’s total revenue is made up of fees from Kimberly-Clark; (3) policies or procedures of the consultant that are designed to prevent a conflict of interest; (4) any business or personal relationships between individual consultants involved in the engagement and Committee members; (5) any shares of Kimberly-Clark stock owned by individual consultants involved in the engagement; and (6) any business or personal relationships between our executive officers and the consulting firm or the individual consultants involved in the engagement. Based on its review, the Committee does not believe that any of the compensation consultants that performed services in 2021 has a conflict of interest with respect to the work performed for Kimberly-Clark or the Committee.

Committee Report

The Committee has reviewed the “Compensation Discussion and Analysis” section of this proxy statement and has recommended that it be included in this proxy statement. The Committee’s report is located at “Compensation Discussion and Analysis — Management Development and Compensation Committee Report.”

Nominating and Corporate Governance Committee

Each member of this Committee is an Independent Director under the rules of the SEC and the NYSE, as well as under our Corporate Governance Policies. The Committee met five times in 2021.

The Committee’s principal functions, as specified in its charter, include the following:

	Maintaining and reviewing a Board succession plan
	Overseeing the process for Board nominations
	Advising the Board on:

		Board organization, membership, function, performance and compensation
		committee structure and membership
		policies and positions regarding significant stockholder relations issues

	Overseeing corporate governance matters, including developing and recommending to the Board changes to our Corporate Governance Policies
	Reviewing director independence standards and making recommendations to the Board with respect to the determination of director independence
	Monitoring and recommending improvements to the Board’s practices and procedures
	Reviewing stockholder proposals and considering how to respond to them
	Overseeing matters relating to Kimberly-Clark’s corporate social responsibility and sustainability activities and providing input to management on these programs and their effectiveness
	Overseeing the Corporation’s public policy activities, including political contributions and lobbying activities

The Committee, in accordance with its charter and our Certificate of Incorporation, has established criteria and processes for director nominations, including those proposed by stockholders. Those criteria and processes are described in “Proposal 1. Election of Directors - Process and Criteria for Nominating Directors,” “Other Information - Stockholder Director Nominees for Inclusion in Next Year’s Proxy Statement” and “Other Information - Stockholder Director Nominees Not Included in Next Year’s Proxy Statement.”

Executive Committee

The Committee met two times in 2021.

The Committee’s principal function is to exercise, when necessary between Board meetings, the Board’s powers to direct our business and affairs.

Compensation Committee Interlocks and Insider Participation

None of the members of the Management Development and Compensation Committee is a current or former officer or employee of Kimberly-Clark. No interlocking relationship exists between the members of our Board of Directors or the Management Development and Compensation Committee and the board of directors or compensation committee of any other company.

Stockholder Rights

Proxy Access By-Law. Eligible stockholders may nominate candidates for election to the Board under our “proxy access” By-Law. Proxy access candidates will be included in our proxy materials. The proxy access By-Law permits a stockholder, or a group of up to 20 stockholders, owning three percent or more of our outstanding common stock continuously for at least three years to nominate and include in our proxy materials directors constituting up to two individuals or 20 percent of the Board (whichever is greater).

Stockholders who wish to nominate directors under our proxy access By-Law should follow the instructions under “Other Information - Stockholder Director Nominees for Inclusion in Next Year’s Proxy Statement.”

Special Stockholder Meetings. Our Certificate of Incorporation allows the holders of 15 percent or more of our issued and outstanding shares of capital stock to request that a special meeting of stockholders be called, subject to procedures and other requirements set forth in our By-Laws.

Board Policy on Stockholder Rights Plans. We do not have a “poison pill” or stockholder rights plan. If we were to adopt a stockholder rights plan, the Board would seek prior stockholder approval of the plan unless, due to timing constraints or other reasons, a majority of Independent Directors of the Board determines that it would be in the best interests of stockholders to adopt a plan before obtaining stockholder approval. If a stockholder rights plan is adopted without prior stockholder approval, the plan must either be ratified by stockholders or must expire, without being renewed or replaced, within one year. The Nominating and Corporate Governance Committee reviews this policy statement periodically and reports to the Board on any recommendations it may have concerning the policy.

Simple Majority Voting Provisions. Our Certificate of Incorporation does not include supermajority voting provisions.

Communicating with Directors; Stockholder Engagement Policy

The Board has established a process by which stockholders and other interested parties may communicate with the Board, including the Lead Director. That process can be found in the Investors section of our website at www.kimberly-clark.com.

Under our stockholder engagement policy, set forth in our Corporate Governance Policies, stockholders who wish to meet directly with members of our Board may send a meeting request to our Lead Director who will consider the request in consultation with the Corporate Secretary. Requests should include information about the requesting party (including the number of shares held), the reason for requesting the meeting and the topics to be discussed.

Stockholder Engagement

In 2021, we continued our focus on regularly engaging with investors to understand their perspectives on a variety of topics. This process helps ensure that management and the Board understand and consider the issues that matter most to our stockholders and enables us to address them effectively. We reached out to stockholders representing approximately 50 percent of our common stock and engaged with stockholders representing approximately 17 percent of our common stock. We discussed many key topics, including our response to managing through the continuing COVID-19 pandemic and our refreshed corporate purpose, our approach to director refreshment, our commitment to inclusion and diversity, our corporate governance practices, including the recent reduction of our special meeting ownership threshold from 25 percent to 15 percent, significant enhancements to our corporate social responsibility and sustainability disclosures and our executive compensation program.

Investors continued to express broad support for our governance structures and executive compensation program and shared their views on matters related to shareholder rights and our independent, well-qualified Board. Further, investors highlighted the importance of continuing our ongoing engagement with them on corporate responsibility and sustainability initiatives. Our corporate governance profile, executive compensation programs, and sustainability initiatives reflect the input of stockholders from our outreach efforts.

Our Approach to Sustainability

Everything we do at Kimberly-Clark is connected to our ambition and purpose to provide better care for a better world. Our teams are working to provide the best experiences for our consumers, customers and the communities where we work and live. We are committed to doing our part to work to safeguard natural systems, tackle inequality, and lift up people around the world.

In 2020, we refined our Sustainability strategy to look further ahead to 2030 and sharpen our focus on areas where we believe we can make the greatest difference. We challenged ourselves to reset our ambition level to drive action that we believe is proportionate to the challenges and opportunities that lie ahead. Our new ambition is to improve the lives and well-being of one billion people in underserved and vulnerable communities globally, with the smallest environmental footprint.

Strategic Focus		Our 2030 Aspiration		2030 Goal
Social Impact		Provide product innovation and social and community program investments that increase access to sanitation, help children thrive and empower women and girls.		Advance the well-being of 1 billion people in vulnerable and underserved communities.
Plastics Footprint		Deliver solutions that incorporate more renewable materials and materials that can be regenerated after use.		Reduce plastics footprint by 50%.
Forests Footprint		Address the climate and biodiversity crises by reducing reliance on fiber from natural forests.		Reduce Natural Forest Fiber footprint by 50%.
Carbon Footprint		Increase energy efficiency while seeking lower carbon solutions.		Reduce absolute greenhouse gas (GHG) emissions (Scopes 1 and 2) by 50% over 2015 base year. Reduce value chain emissions (Scope 3) by 20%.*
Water Footprint		Reduce water use at sites in watersheds under stress while supporting community-based water programs.		Reduce water footprint in water-stressed areas by 50%.

Board Oversight and Governance. Our Board has established and approved the framework for our sustainability-related policies and procedures, including environmental stewardship, energy and climate, fiber sourcing, waste and water management, product safety, charitable contributions, human rights, labor, and inclusion and diversity in employment. As part of their oversight roles, the Board and the Nominating and Corporate Governance Committee receive regular reports from management on these topics, our goals and our progress toward achieving them.

Our Board oversees risk management, including risks related to environmental issues, including climate-related risks and opportunities, and social issues. The Board is focused on our long-term business strategy, including fostering sustainability-driven innovations, and incorporates our sustainability risks and opportunities into its overall strategic decision-making. Sustainability risk areas for our company include shifting customer and consumer preferences toward sustainable products, increasing regulation and mandates related to single-use plastics and climate emissions, supply chain risks related to water security and deforestation and the cost of the commodities and natural resources required to make and market our products.

Recent Results. In 2021, we published our progress one year into our Sustainability 2030 program, which included significant progress against our goals in 2020. Highlights include:

	Celebrated five years of the “Toilets Change Lives” program, which has improved access to sanitation for nearly 4 million people in need
	Expanded Huggies’ “No Baby Unhugged” initiative into Latin America, growing its potential global impact by nearly 2 million babies and young children across 16 countries
	Combated stigmas and period poverty with menstrual hygiene education and donations of 12 million period products to those in need
	Achieved absolute GHG reduction of 32.1 percent in Scope 1 and 2 emissions and 3 percent reduction in Scope 3 emissions from our 2015 base year
	Reduced use of fiber from natural forest landscapes by 19 percent (vs. 2011 baseline) and our water use at our facilities in high-stress regions by 32.5 percent (vs. 2015 baseline)
	Launched new waste-reduction initiatives that helped us divert 96 percent of our manufacturing waste

Progress toward our climate goals accelerated over the past several years through a combination of energy conservation, alternative/renewable energy projects and manufacturing footprint optimization. In 2020, despite the project resource restrictions associated with the COVID-19 pandemic, we were able to deliver Scope 1 & 2 GHG emissions reductions of over 200,000 MTCO2e. This result was primarily driven by larger alternative and renewable energy project executions that represented just over 60 percent of the reduction. The largest single contributor to the reduction came from our Chester, Pennsylvania facility and the startup of a new combined heat and power (CHP) cogeneration plant that enabled the transition away from coal-based fuel to 100 percent natural gas consumption. This reduced the facility’s GHG emission by 40 percent (vs a 2018 baseline).

In summer of 2020, we announced new climate targets, which have been validated with the Science-Based Targets Initiative. These include a 50 percent reduction in Scope 1 + 2 GHG emissions and 20 percent reduction in Scope 3 greenhouse gas emissions from Purchased Goods and Services and End of Life Treatment of Sold Products categories by 2030 (vs a 2015 base year).

Sustainability Reporting. Each year, Kimberly-Clark publishes a Global Sustainability Report outlining our key strategies, initiatives and results in greater detail. Our report includes an addendum of material organized and presented in accordance with the Global Reporting Initiative (GRI) and Sustainability Accounting Standards Board (SASB) Standards, and can be found on our website at www.kimberly-clark.com/esg. We continue to monitor best practices on reporting frameworks and in 2021 published a Task Force on Climate-related Financial Disclosures (TCFD)-aligned disclosure to enhance visibility to our climate risks and opportunities. Within our disclosure, we cover TCFD’s four core areas: governance, strategy, risk management, and metrics and targets.

Stakeholder Engagement and Recognition. In setting our sustainability priorities and implementing our programs, we are supported by an independent Sustainability Advisory Board with external thought leaders who provide guidance on key governance, social and environmental issues. We also routinely engage our stockholders on the topic of sustainability through our governance engagement program and regular investor meetings. In these meetings, we often discuss sustainability topics and priorities relevant to our business.

External partnerships also play an important role in our sustainability programs. For example, we are a signatory to the U.K. and U.S. Plastics Pacts and we serve as members of the steering committee for Ocean Conservancy’s Trash Free Seas Alliance. In addition, we have strong relationships with World Wildlife Fund (WWF) and the Forest Stewardship Council^® (FSC^®), with many of our tissue products around the world proudly displaying the FSC marks.

Our sustainability program continues to receive strong recognition from our external stakeholders. Most recent rankings include:

	CDP (formerly Carbon Disclosure Project) 2021 “A-” ranking for Climate Change, and “B” in Water Security and Forests
	FTSE4Good Index Series - 18th consecutive year - for excellence in environmental, social, and governance
	EcoVadis Gold 2021 Sustainability Rating, score of 66 (92nd percentile)
	Rating of “AA” in MSCI Global Sustainability Index
	Forbes JUST Capital 2022 Top 100, Best Employers List and Best Employers for Diversity
	US Environmental Protection Agency’s SmartWay Excellence Award 2021 (8th consecutive year) for freight supply chain energy and environmental performance

Recent Events Related to COVID-19

Throughout the COVID-19 pandemic, our priority has been the safety of our employees and consumers. We have continued to take extra precautions globally at our office, mill and distribution center operations, which were developed in line with guidance from global health authorities, including remote work and flexible arrangements, as well as social distancing, thermal scanning and partitions in our facilities. As we faced these challenging moments, we remained focused on living our values, guided by our value of caring – for our people, our consumers, and importantly, for those most in need.

The macro business environment experienced unprecedented volatility in 2021 related to the continuing effect the global COVID-19 pandemic has had on supply and demand dynamics. The pandemic has caused significant input cost inflation and worldwide supply chain disruption, and we are incredibly proud of the great teamwork exhibited by our approximately 46,000 employees around the world who are doing their best to provide a steady supply of product. Throughout this difficult environment, we have continued to invest in our brands and capabilities, and we believe we made good progress in 2021 executing our strategies for long-term success.

Inclusion and Diversity

By leading with inclusion, we plan to deliver on our purpose of Better Care for a Better World as we work to become a global organization that looks and thinks like the people who use (and have yet to use) our essential products.

Our Board of Directors and Leadership. Our Board remains committed to multiple dimensions of diversity. We believe that having a Board that is representative of our customer, consumer, employee and stockholder base is an important element of our leadership and gives us a competitive advantage. In 2021,

	Women and people of color comprised 36 percent and 23 percent of our employee leadership population at the director-level and above, respectively.
	Women and people of color comprised 46 percent and 31 percent of our Board nominees, respectively. Women chair 50 percent of our Board committees.
	Women and people of color comprised 25 percent and 50 percent, respectively, of the Executive Leadership Team roles reporting to our CEO.

Our Strategy and Engagement. In 2021, we continued to deliver on our global inclusion and diversity strategy through a four-pillar approach focused on the following key elements:

	Create Community: Develop a Kimberly-Clark community whose deepened understanding and daily actions drive inclusion, embrace diversity, and empower authenticity.
	Leverage Leadership: Raise the standard, expecting our leaders to act as cultural enablers who build diverse, high-performing teams and infuse inclusion into decision-making and the workplace experience.
	Empower Employees: Empower talent to thrive, and embrace hiring, promotion, and development practices that reflect our diverse consumer base.
	Accelerate Action: Integrate inclusion and diversity into everything we do, using our strength to combat inequities for our people, our consumers, and our communities around the world – to make lives better today and tomorrow.

Our business success is tied to cultivating workplaces, communities, and experiences where inclusion and diversity are evident and thriving. Building on our momentum of 2020, we held our second annual Global Inclusion Week in 2021, engaging over 59 countries over 5 days to activate a culture of inclusion & diversity.

Aligned with our value of Growing Our People, we introduced our Activating Inclusive Leadership initiative geared towards enhancing inclusion and diversity capabilities within our Global Team Leader population. To date, approximately 70 percent of all Kimberly-Clark leaders have completed this requisite training where they reflect on and learn how to lead with conscious inclusion, with the objective of infusing it into how we work, enabling better business decisions and empowering employees to build an inclusive culture. We believe inclusion is a strategic capability we must build from the inside out. By embedding inclusion into our ways of working, we will co-create and innovate in new ways while seeking to ensure that everyone is treated with dignity, recognized for their abilities, and valued for who they are.

Our Workforce and Transparency. As part of our commitment to building a diverse workforce, we have expanded our focus from women in senior leadership roles to now include a focus on women in all management roles globally. Similarly, we applied the same expanded focus to now include people of color in all management roles in the United States. This remains a prioritized element of our strategic business plan and our annual incentive plan for our leadership, as described further in “Compensation Discussion and Analysis.” We continue to provide transparent updates on our progress, disclosing our results in our Sustainability Report and included below.

It is our practice to disclose our annual EEO-1 data on the Sustainability section of our website after our submission of the corresponding report to the U.S. Equal Employment Opportunity Commission.

Other Corporate Governance Policies and Practices

Corporate Governance Policies. The Board of Directors has adopted Corporate Governance Policies which guide Kimberly-Clark and the Board on matters of corporate governance, including: director responsibilities, Board committees and their charters, director independence, director compensation, performance assessments of the Board and individual directors, Board succession planning, confidentiality and conflicts of interest, director commitments, director orientation and education, director access to management, Board access to outside financial, business and legal advisors, management development and succession planning, and Board interaction with stockholders. Our Corporate Governance Policies provide for retirement at age 72. The Board monitors emerging issues and amends these policies from time to time as rules and regulations change and governance practices develop. To see the policies, go to the Investors section of our website at www.kimberly-clark.com.

Board and Committee Evaluations. The Board conducts annual self-evaluations to determine whether it and its committees are functioning effectively and whether its governing documents continue to remain appropriate. Each Board member is periodically evaluated on an individual basis. The process is designed and overseen by our Lead Director and our Nominating and Corporate Governance Committee, and the results of the evaluations are discussed by the full Board.

Each committee annually reviews its own performance and assesses the adequacy of its charter, and reports the results and any recommendations to the Board. The Nominating and Corporate Governance Committee oversees and reports annually to the Board its assessment of each committee’s performance evaluation process.

Board Succession Planning. Our Nominating and Corporate Governance Committee maintains and reviews a succession plan for the Board, as described in “Proposal 1. Election of Directors-Process and Criteria for Nominating Directors.”

Code of Conduct. Kimberly-Clark has a Code of Conduct that applies to all of our directors, executive officers and employees, including our CEO, Chief Financial Officer and Vice President and Controller. It is available in the Investors section of our website at www.kimberly-clark.com. Any amendments to or waivers of our Code of Conduct applicable to our CEO, Chief Financial Officer or Vice President and Controller will also be posted at that location. It is our policy that any waiver of our Code of Conduct for executive officers or directors may be made only by our Board or a committee of our Board.

Board and Management Roles in Risk Oversight. The Board is responsible for providing risk oversight with respect to our operations. In connection with this oversight, the Board particularly focuses on our strategic and operational risks, as well as related risk mitigation. In addition, the Board reviews and oversees management’s response to key risks facing Kimberly-Clark.

The Board’s committees review particular risk areas to assist the Board in its overall risk oversight of Kimberly-Clark:

	The Audit Committee oversees our risk management program, with a particular focus on our internal controls, compliance programs, financial statement integrity and fraud risks, data privacy, cybersecurity, business continuity, IT operational resilience and regulatory matters, and related risk mitigation. In connection with this oversight, the Audit Committee receives regular reports from management on risk assessments, the risk management process, and issues related to the risks of managing our business. The Audit Committee also receives an annual enterprise risk management update, which describes our key financial, strategic, operational and compliance risks.
	The Management Development and Compensation Committee reviews the risk profile of our compensation policies and practices. This process includes a review of an assessment of our compensation programs, as described in “Compensation Discussion and Analysis — Analysis of Compensation-Related Risks.”
	The Nominating and Corporate Governance Committee monitors risks relating to governance matters and recommends appropriate actions in response to those risks. In addition, it provides oversight of our corporate social responsibility programs and sustainability activities and receives regular updates on the effectiveness of these programs.

Complementing the Board’s overall risk oversight, our senior executive team identifies and monitors key enterprise-wide and business unit risks, providing the basis for the Board’s risk review and oversight process. We have a Global Risk Oversight Committee, consisting of management members from core business units and from our finance, treasury, global risk management, legal, internal audit, human resources and supply chain functions. This committee identifies significant risks for review and updates our policies for risk management in areas such as hedging, foreign currency and country risks, product liability, property and casualty risks, data privacy and cybersecurity risks, and supplier and customer risks. The Board believes the allocation of risk management responsibilities described above supplements the Board’s leadership structure by allocating risk areas to an appropriate committee for oversight, allows for an orderly escalation of issues as necessary, and helps the Board satisfy its risk oversight responsibilities.

Information Security. Given the importance of information security and privacy to our stakeholders, the Audit Committee receives regular quarterly reports from our Chief Information Officer and our Chief Information Security Officer covering our program for managing information security risks, including data privacy and data protection risks. We internally follow the National Institute of Standards and Technology cybersecurity framework (NIST CSF) to assess the maturity of our cybersecurity programs. Our robust information security training program for employees includes:

	Information security concepts included in our mandatory onboarding Code of Conduct training for all employees
	Annual information security awareness training for all office workers with a focus on timely, risk-based topics that align to corporate initiatives
	Monthly phishing drills with global participation
	An annual Cyber Security Awareness Month (CSAM) event consisting of educational opportunities and activities for all employees, including internal and external speakers and presentations
	Table-top exercises with senior leaders covering ransomware and third-party threats

We maintain an information security insurance policy that provides coverage for security breaches.

Whistleblower Procedures. The Audit Committee has established procedures for receiving, recording and addressing any complaints we receive regarding accounting, internal accounting controls or auditing matters, and for the confidential and anonymous submission, by our employees or others, of any concerns about our accounting or auditing practices. We also maintain a toll-free Code of Conduct telephone helpline and a website, each allowing our employees and others to voice their concerns anonymously.

Chief Ethics and Compliance Officer. Our Vice President and Chief Ethics and Compliance Officer oversees our compliance programs. His duties include: regularly updating the Audit Committee on the effectiveness of our compliance programs, providing periodic reports to the Board, and working closely with our various compliance functions to promote coordination and sharing of best practices across these functions.

Management Succession Planning. In conjunction with the Board, the Management Development and Compensation Committee is responsible for periodically reviewing the long-term management development plans and succession plans for the CEO and other key officers, as well as the emergency succession plan for the CEO and other key officers if any of these officers unexpectedly becomes unable to perform his or her duties.

Disclosure Committee. We have established a Disclosure Committee to assist in fulfilling our obligations to maintain disclosure controls and procedures and to coordinate and oversee the process of preparing our periodic securities filings with the SEC. This committee is composed of members of management and is chaired by our Vice President and Controller.

No Executive Loans. We do not extend loans to our executive officers or directors, and, therefore, do not have any such loans outstanding.

Charitable Contributions. The Nominating and Corporate Governance Committee has adopted guidelines for the review and approval of charitable contributions by Kimberly-Clark (or any foundation under the common control of Kimberly-Clark) to organizations or entities with which a director or an executive officer may be affiliated. We will disclose in the Investors section of our website at www.kimberly-clark.com any contributions made by us to a tax-exempt organization under the following circumstances:

	An Independent Director serves as an executive officer of the tax-exempt organization; and
	If within the preceding three years, contributions in any single year from Kimberly-Clark to the organization exceeded the greater of $1 million or 2 percent of the tax-exempt organization’s consolidated gross revenues.

As of the date of this proxy statement, the Board of Directors consists of thirteen members. Each director’s term will expire at this year’s Annual Meeting.

Ian C. Read is not standing for re-election. Mr. Read will continue to serve as a director until the Annual Meeting. We would like to thank Mr. Read for his many years of service and substantial contributions to the Board, Kimberly-Clark and our stockholders.

All of the nominees are currently serving as directors except for Sylvia Burwell, who was nominated for election to the Board on February 9, 2022.

All the nominees standing for election at the Annual Meeting are being nominated to serve until the 2023 Annual Meeting of Stockholders and until their successors have been duly elected and qualified. All nominees have advised us that they will serve if elected; however, should any nominee become unable to serve, proxies may be voted for another person designated by the Board.

Given the independent status of the nominees, if all nominees are elected at the Annual Meeting, twelve of the thirteen directors on our Board will be Independent Directors.

Process for
Director
Elections

Our Certificate of Incorporation provides that all of our directors must be elected annually. Our By-Laws provide that, in uncontested elections, directors must be elected by a majority of votes cast rather than by a plurality. If any incumbent director does not receive a majority of votes, he or she is required to tender his or her resignation for consideration by the Board.

Process and
Criteria for
Nominating
Directors

The Board of Directors is responsible for approving candidates for Board membership. The Board has adopted a Board succession planning policy which formalizes its commitment to refreshing and maintaining a group of directors with diverse perspectives and capabilities. The Board believes that adding fresh perspectives is critical, but also values the institutional knowledge and experience of long-serving directors. The Board is committed to balancing these factors through our succession plan, retirement policy and director evaluation process.

Under our succession planning policy, the Nominating and Corporate Governance Committee maintains and reviews a Board succession plan, taking into account current composition and qualifications, Kimberly-Clark’s current and expected needs, director tenure, the effectiveness of the Board and any planned or unplanned vacancies. In consultation with the Chairman of the Board and the Lead Director, the Committee screens and recruits director candidates and recommends to the Board any new appointments and nominees for election as directors at our annual meeting of stockholders. It also recommends nominees to fill any vacancies. As provided in our Certificate of Incorporation, the Board of Directors has the authority to determine the size of the Board and appoint directors between annual meetings of stockholders.

The Committee may receive recommendations for Board candidates from various sources, including our directors, management and stockholders. The Nominating and Corporate Governance Committee periodically retains a search firm to assist it in identifying and recruiting director

candidates meeting the criteria specified by the Committee. The Committee utilized a search firm in connection with the nominations of Mmes. Burwell and Mahlan and Mr. Ramirez. In addition, as described in “Corporate Governance - Stockholder Rights,” our By-Laws provide for proxy access stockholder nominations of director candidates. Stockholders who wish to nominate directors under our proxy access By-Law should follow the instructions under “Other Information - Stockholder Director Nominees for Inclusion in Next Year’s Proxy Statement.” Stockholders who wish to nominate directors who are not intended to be included in the company’s proxy materials should follow the instructions under “Other Information - Stockholder Director Nominees Not Included in Next Year’s Proxy Statement.”

The Committee believes that the criteria for director nominees should foster effective corporate governance, support our strategies and businesses and ensure that our directors, as a group, both have an overall mix of the attributes needed for an effective Board and reflect diversity of background and viewpoint. The criteria should also support the successful recruitment of qualified candidates.

Qualified candidates for director are those who, in the judgment of the Committee, possess a sufficient mix of the experience attributes listed below to ensure effective service on the Board. In addition, all nominees must possess high standards for ethical behavior, good interpersonal skills and a proactive and solution-oriented leadership style.

EXPERIENCE ATTRIBUTES

Committee
Review of
Attributes
of Current
Directors

The Nominating and Corporate Governance Committee has reviewed the background of each of our director nominees in light of the experience attributes described above. The Committee has determined that each nominee possesses a sufficient mix of the experience attributes and that the nominees collectively possess the necessary experience to effectively guide our company.

For details about each nominee’s specific experience attributes, see “The Nominees” below.

Diversity of
Directors

As noted above, the Nominating and Corporate Governance Committee believes that diversity of backgrounds and viewpoints is a key attribute to include in the boardroom. As a result, the Committee seeks to have a diverse Board that is representative of our customer, consumer, employee and stockholder base, including gender and ethnic/racial diversity. While the Committee carefully considers this diversity when identifying potential director candidates, the Committee has not established a formal policy regarding diversity. Our Board currently includes individuals of differing ages, races and genders. In particular, 46% of our director nominees are female and 31% of our director nominees are ethnically diverse.

Director
Compensation

Directors who are not officers or employees of Kimberly-Clark or any of our subsidiaries, affiliates or equity companies are “Outside Directors” for compensation purposes and are compensated for their services under our 2021 Outside Directors’ Compensation Plan. All Independent Directors currently on our Board are Outside Directors and are compensated under this Plan.

Our objectives for Outside Director Compensation are:

	to remain competitive with the median compensation paid to outside directors of comparable companies
	to keep pace with changes in practices in director compensation
	to attract qualified candidates for Board service
	to reinforce our practice of encouraging stock ownership by our directors

In 2020, the Nominating and Corporate Governance Committee assessed our Outside Director compensation against the median non-management director compensation for our peers. Based on this review, the Committee recommended no change to Outside Director compensation for 2021, and the Board agreed with the Committee’s recommendation.

The table below shows how we structured Outside Director compensation in 2021:

New Outside Directors receive the full quarterly amount of the annual retainer for the quarter in which they join the Board. Their annual grant of restricted share units is pro-rated based on the date when they joined.

We also reimburse Outside Directors for expenses incurred in attending Board or committee meetings.

Restricted share units are not shares of our common stock. Rather, restricted share units represent the right to receive a pre-determined number of shares of our common stock within 90 days following a “restricted period” that begins on the date of grant and expires on the date the Outside Director retires from or otherwise terminates service on the Board. In this way, they align the director’s interests with the interests of our stockholders. Outside Directors may not dispose of the units or use them in a pledge or similar transaction. Outside Directors also receive additional restricted share units equivalent in value to the dividends that would have been paid to them if the restricted share units granted to them were shares of our common stock.

2021 Outside
Director
Compensation

The following table shows the compensation paid to each Outside Director for his or her service in 2021.

Other than the cash retainer, grants of restricted share units and the other compensation previously described, no Outside Director received any compensation or perquisites from Kimberly-Clark for services as a director in 2021.

A director who is not an Outside Director does not receive any compensation for services as a member of the Board or any committee, but is reimbursed for expenses incurred as a result of the services.

In 2021, the Nominating and Corporate Governance Committee, with the assistance of Mercer, revisited the Corporation’s Outside Director compensation to assess whether it still met our objectives for Outside Director compensation as described above. In its assessment, the Committee compared aggregate Outside Director cash and equity compensation to the median compensation of the outside directors of our peer group, as well as the structure of our compensation programs of our peer group. For information regarding our peer group, see “Compensation Discussion and Analysis” below. Based on this review, the Committee determined that the aggregate compensation for our Outside Directors would be below the median of our peer group in 2022. The Committee then recommended to the Board, and the Board approved, changes to our Outside Directors aggregate compensation to more closely align with the median aggregate compensation of our peer group.

Accordingly, beginning in 2022:

	The annual cash retainer is increased from $100,000 to $105,000, and
	The value of the annual grant of restricted share units is increased from $180,000 to $185,000.

There was no change to the amount of the additional annual grant of restricted share units paid to committee chairs or to the Lead Director.

The Audit Committee of the Board of Directors is directly responsible for the appointment, compensation, retention and oversight of our independent auditor. The Audit Committee is also responsible for overseeing the negotiation of the audit fees associated with retaining our independent auditor. To assure continuing auditor independence, the Audit Committee periodically considers whether a different audit firm should perform our independent audit work. Also, in connection with the mandated rotation of the independent auditor’s lead engagement partner, the Audit Committee and its chairman are directly involved in the selection of the new lead engagement partner.

For 2022, the Audit Committee has selected Deloitte & Touche LLP (along with its member firms and affiliates, “Deloitte”) as the independent registered public accounting firm to audit our financial statements. In engaging Deloitte for 2022, the Audit Committee utilized a review and selection process that included the following:

	a review of management’s assessment of the services Deloitte provided in 2021 and a comparison of this assessment to prior years’ reviews
	discussions, in executive session, with the Chief Financial Officer and the Vice President and Controller regarding their viewpoints on the selection of the 2022 independent auditor and on Deloitte’s performance
	discussions, in executive session, with representatives of Deloitte about their possible engagement
	Audit Committee discussions, in executive session, about the selection of the 2022 independent auditor
	a review and approval of Deloitte’s proposed estimated fees for 2022
	a review and assessment of Deloitte’s independence
	the Audit Committee’s consideration of the fact that Deloitte has served as our independent auditor since 1928, including its understanding of our global business, accounting policies and practices, and internal control over financial reporting, and its conclusion that its term of service does not impact Deloitte’s independence

The Audit Committee and the Board believe that the continued retention of Deloitte to serve as our independent auditor is in the best interests of Kimberly-Clark and its stockholders, and they recommend that stockholders ratify this selection. If the stockholders do not ratify the selection of Deloitte, the Audit Committee will consider the selection of another independent auditor.

Representatives of Deloitte are expected to be present at the Annual Meeting with the opportunity to make a statement if they desire to do so and will be available to respond to appropriate questions.

Principal Accounting Firm Fees

Our aggregate fees to Deloitte (excluding value added taxes) with respect to the fiscal years ended December 31, 2021 and 2020, were as follows (dollars in millions):

Audit Committee Approval of Audit and Non-Audit Services

The Audit Committee has a policy for pre-approval of all audit and permissible non-audit services provided by Deloitte. Each year, the Audit Committee approves the terms on which Deloitte is engaged for the ensuing year. At least quarterly, the Audit Committee reviews and, if appropriate, pre-approves non-audit services to be performed by Deloitte, reviews a report summarizing year-to-date approved non-audit services provided by Deloitte, and reviews an updated projection of the year’s estimated non-audit service fees. To ensure prompt handling of unexpected matters, the Audit Committee has delegated to the Chair of the Audit Committee the authority to amend or modify the list of audit and non-audit services and fees between meetings, as long as the additional or amended services do not affect Deloitte’s independence under applicable rules. The Audit Committee then reviews the Chair’s approval decisions each quarter.

All Deloitte services and fees in 2021 and 2020 were pre-approved by the Audit Committee or the Audit Committee Chair.

Audit Committee Report

In accordance with its charter adopted by the Board, the Audit Committee assists the Board in overseeing the quality and integrity of Kimberly-Clark’s accounting, auditing and financial reporting practices.

In discharging its oversight responsibility for the audit process, the Audit Committee obtained from the independent registered public accounting firm (the “auditor”) a formal written statement describing all relationships between the auditor and Kimberly-Clark that might bear on the auditor’s independence, as required by Public Company Accounting Oversight Board (“PCAOB”) Rule 3526, Communication with Audit Committees Concerning Independence, discussed with the auditor any relationships that may impact the auditor’s objectivity and independence and satisfied itself as to the auditor’s independence. The Audit Committee also discussed with management, the internal auditors, and the auditor, the quality and adequacy of Kimberly-Clark’s internal controls and the internal audit function’s organization, responsibilities, budget and staffing. The Audit Committee reviewed with both the auditor and the internal auditors their audit plans, audit scope and identification of audit risks.

The Audit Committee discussed with the auditor the matters required to be discussed by the applicable requirements of the PCAOB and the SEC. Also, with and without management present, it discussed and reviewed the results of the auditor’s examination of our financial statements and our internal control over financial reporting. The Committee also discussed the results of internal audit examinations.

Management is responsible for preparing Kimberly-Clark’s financial statements in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and for establishing and maintaining Kimberly-Clark’s internal control over financial reporting. The auditor has the responsibility for performing an independent audit of Kimberly-Clark’s financial statements and internal control over financial reporting, and expressing opinions on the conformity of Kimberly-Clark’s financial statements with GAAP and the effectiveness of internal control over financial reporting. The Audit Committee discussed and reviewed Kimberly-Clark’s audited financial statements as of and for the fiscal year ended December 31, 2021, with management and the auditor. The Audit Committee also reviewed management’s assessment of the effectiveness of internal controls as of December 31, 2021, and discussed the auditor’s examination of the effectiveness of Kimberly-Clark’s internal control over financial reporting.

Based on the above-mentioned reviews and discussions with management and the auditor, the Audit Committee recommended to the Board that Kimberly-Clark’s audited financial statements be included in Kimberly-Clark’s Annual Report on Form 10-K for the fiscal year ended December 31, 2021, for filing with the SEC. The Audit Committee also has selected and recommended to stockholders for ratification the reappointment of Deloitte as the independent registered public accounting firm for 2022.

In the Compensation Discussion and Analysis that follows, we describe in detail our executive compensation program, including its objectives, policies and components. As discussed in that section, our executive compensation program seeks to align the compensation of our executives with our strategic objectives. To this end, the Management Development and Compensation Committee (the “Committee”) has adopted executive compensation policies that are designed to achieve the following objectives:

	Pay-for-Performance. Support a performance-oriented environment that rewards achievement of our financial and non-financial goals.
	Focus on Long-Term Success. Reward executives for long-term strategic management and stockholder value enhancement.
	Stockholder Alignment. Align the financial interests of our executives with those of our stockholders.
	Quality of Talent. Attract and retain executives whose abilities are considered essential to our long-term success.

For a more detailed discussion of how our executive compensation program reflects these objectives and policies, including information about the fiscal year 2021 compensation of our named executive officers, see “Compensation Discussion and Analysis,” below.

We are asking our stockholders to support our executive compensation as described in this proxy statement. This proposal, commonly known as a “say-on-pay” proposal, gives our stockholders the opportunity to express their views on our executive compensation on an annual basis. This vote is not intended to address any specific item of compensation, but rather the overall compensation of our executives and the objectives, policies and practices described in this proxy statement. Accordingly, we will ask our stockholders to vote on the following resolution at the Annual Meeting:

RESOLVED, that the compensation paid to the Corporation’s named executive officers, as disclosed pursuant to Item 402 of Regulation S-K, including the Compensation Discussion and Analysis, compensation tables and narrative discussion, is hereby approved by the Corporation’s stockholders on an advisory basis.

The say-on-pay vote is advisory and is therefore not binding on Kimberly-Clark, the Committee or our Board. Nonetheless, the Committee and our Board value the opinions of our stockholders. Therefore, to the extent there is any significant vote against the executive compensation as disclosed in this proxy statement, the Committee and our Board will consider our stockholders’ concerns and will evaluate whether any actions are necessary to address those concerns.

This Compensation Discussion and Analysis is intended to provide investors with an understanding of our compensation policies and decisions regarding 2021 compensation for our named executive officers.

For 2021, our named executive officers are:

In addition, we provide compensation information regarding Kimberly Underhill who served as our Group President, K-C North America until April 2021 when she assumed a transitional role until she departed the company on September 1, 2021. References in the following discussion to our “named executive officers” do not include Ms. Underhill unless we specify otherwise. We discuss Ms. Underhill’s compensation separately under “Executive Compensation for 2021 - Compensation of Former Named Executive Officer” below.

2021 Compensation Highlights

As measured under our annual incentive program, we delivered the results below in net sales and adjusted earnings per share (EPS).

Based on 2021 performance, the Management Development and Compensation Committee of our Board (the “Committee”) concluded that:

	management did not deliver its financial targets for 2021,
	we faced significant headwinds related to the COVID-19 pandemic, including input cost inflation, supply chain disruption and a reversal in consumer tissue volumes from record growth in 2020 as consumers and retailers in North America continued to reduce home and retail inventory, and
	management nevertheless prudently managed our business through extreme market conditions and continued to make good progress executing strategies for our long-term success, including:

		focusing on targeted growth initiatives and product innovations, including the Softex Indonesia integration, and continuing to enhance our commercial capabilities for long-term success,
		emphasizing market share improvement in our priority markets, including in our personal care business,

		leveraging cost and financial discipline to fund growth and improve margins, taking multiple pricing actions, generating significant cost savings, managing discretionary spending and completing the 2018 Global Restructuring Program, and
		allocating capital in stockholder-friendly ways, returning approximately $1.9 billion to stockholders through dividends and share repurchases.

Accordingly, the Committee approved annual cash incentives for 2021 below the target amount, including an incentive payout for the CEO at 62 percent of his target payment amount.

Performance-Based Compensation

Pay-for-performance is a key objective of our compensation programs. Consistent with that objective, performance-based compensation constituted a significant portion of our named executive officers’ direct annual compensation targets for 2021. Also, to further align the financial interests of our executives with those of our stockholders, a majority of our executives’ target direct annual compensation for 2021 was equity based.

COMPOSITION OF TARGET DIRECT COMPENSATION

	Chairman and CEO
	Named Executive Officers

	Chairman and CEO		Named Executive Officers

Committee Consideration of 2021 Stockholder Advisory Vote

At our 2021 Annual Meeting, our executive compensation program received the support of approximately 94 percent of shares represented at the meeting. The Committee has considered the results of this vote and views this outcome as evidence of stockholder support of its executive compensation decisions and policies. Accordingly, the Committee has not made any substantial changes to its executive compensation policies for 2022. The Committee will continue to review the annual stockholder votes on our executive compensation program and determine whether to make any changes in light of the results.

CEO Target Direct Compensation and Realizable Direct Compensation

The following chart compares our CEO’s target direct annual compensation and realizable direct compensation over the last three years. Realizable direct compensation reflects the actual compensation received for base salary and annual cash incentive plus the value of the long-term equity incentives granted in that year, determined as follows:

	For unexercised stock options, the amount by which our 2021 year-end stock price ($142.92) exceeds the exercise price, if any, multiplied by the number of options granted (that is, the “in-the-money” value of the options at year-end) and for exercised stock options, the actual value realized upon exercise, and
	For performance-based restricted share units, intrinsic value is the number of units that were paid out based on actual performance (for the grant made in 2019) or are expected to be paid out based on projected performance (for the grants made in 2020 and 2021), multiplied by our 2021 year-end stock price.

Key factors causing realizable direct compensation to differ from target direct annual compensation over these three years are:

	Actual performance that resulted in annual cash incentives to be paid out at 132 percent of target (2019), 158 percent of target (2020) and 62 percent of target (2021).
	Actual performance that resulted in the number of shares to be issued as a result of performance-based restricted share unit payouts of 130 percent of target (2019 award) and projected payouts of 50 percent of target (2020 award) and 80 percent of target (2021 award), and
	Changes in our stock price over the last three years that significantly impacted the intrinsic value of stock options and the dollar value of performance-based restricted share units granted in each year. Our stock prices on the dates stock options were granted to our CEO were $125.47 (2019), $138.96 (2020) and $132.63 (2021).

The Committee believes that this chart demonstrates that our CEO’s realizable direct compensation varies from his target direct annual compensation based on our performance and stock price consistent with our pay-for-performance philosophy.

Executive Compensation Objectives and Policies

The Committee establishes and administers our policies governing the compensation of our elected officers, including our named executive officers. The Committee reviews our compensation philosophy annually and determines whether it supports our business objectives and is consistent with the Committee’s charter.

The Committee has adopted executive compensation policies that are designed to achieve the following objectives:

These compensation objectives and policies seek to align the compensation of our elected officers, including our named executive officers, with our strategic objectives to:

	grow our portfolio of brands through innovation, category development and commercial execution
	leverage our cost and financial discipline to fund growth and improve margins
	allocate capital in value-creating ways

Components of Our Executive Compensation Program

The table below gives an overview of the compensation components used in our program and matches each with one or more of the objectives described above.

Setting Annual Compensation

This section describes how the Committee thinks about annual compensation and the processes that it followed in setting 2021 target annual compensation for our named executive officers.

Focus on Direct Annual Compensation

In setting 2021 compensation for our executive officers, including our CEO, the Committee focused on direct annual compensation, which consists of annual cash compensation (base salary and annual cash incentive) and long-term equity incentive compensation (performance-based restricted share units and stock options). The Committee considered annual cash and long-term equity incentive compensation both separately and as a package to help ensure that our executive compensation objectives are met.

Executive Compensation Peer Group

To ensure that our executive compensation programs are reasonable and competitive in the marketplace, the Committee compares our programs to those at other companies. In 2021, the Committee used the following peer group that contains consumer goods and business-to-business companies of a similar size against whom we compete for talent:

In developing the peer group, the Committee does not consider individual company compensation practices, and no company has been included or excluded because it is known to pay above-average or below-average compensation. The Committee (working with the Committee’s retained independent compensation consultant, Semler Brossy, and the company’s retained consultant, Mercer), reviews the peer group annually to ensure that it continues to serve as an appropriate comparison for our compensation program.

For purposes of setting executive compensation for 2021, the Committee did not make any changes to the peer group used in 2020. Likewise, in setting compensation for 2022, the Committee did not make any changes to the peer group.

Process for Setting Direct Annual Compensation Targets

In setting the direct annual compensation of our executive officers, the Committee evaluates both market data provided by the compensation consultants and information on the performance of each executive officer for prior years.

To remain competitive in the marketplace for executive talent, the target levels for the executive officers’ total direct compensation are typically set near the peer group median. To reinforce a pay-for-performance culture, targets for individual executive officers may be set above or below the median depending on the individual’s performance in prior years and experience in the position. The Committee believes that setting targets as described above and providing incentive compensation opportunities that will enable executives to earn above-target compensation if they deliver above-target performance on their performance goals are consistent with the objectives of our compensation policies. In particular, the Committee believes that this approach enables us to attract and retain skilled and talented executives to guide and lead our businesses and supports a pay-for-performance culture. At times, the Committee may award long-term equity incentive compensation to key individuals to address retention concerns.

When setting annual compensation for our executive officers, the Committee considers each compensation component (base salary, annual cash incentive and long-term equity incentive), but its decision regarding a particular component does not necessarily impact its decision about other components.

In setting compensation for executive officers that join us from other companies, the Committee evaluates market data for the position to be filled. The Committee recognizes that in order to successfully recruit a candidate to leave his or her current position and to join Kimberly-Clark, the candidate’s compensation package may have to exceed his or her current compensation, resulting in a package above the median of our peer group.

CEO Direct Annual Compensation

The Committee determines the CEO’s direct annual compensation in the same manner as the direct annual compensation of the other named executive officers. Consistent with past practices, the Committee reviewed the pay relationship of Mr. Hsu to the other named executive officers in 2021.

Direct Annual Compensation Targets for 2021

Consistent with its focus on direct annual compensation, the Committee approved 2021 direct annual compensation targets for each of our named executive officers. The Committee believes that these target amounts, which formed the basis for the Committee’s compensation decisions for 2021, were appropriate and consistent with our executive compensation objectives:

The Committee set Mr. Torres’ target upon his promotion to Group President, K-C North America in April 2021. His actual payout for his cash incentive was prorated based on time in each role as discussed below under “2021 Targets.”

These 2021 direct annual compensation target amounts differ from the amounts set forth in the Summary Compensation Table in the following ways:

	Base salaries are adjusted on April 1 of each year, while the Summary Compensation Table includes salaries for the calendar year. See “Executive Compensation for 2021 – Base Salary.”
	Annual cash incentive compensation is included at the target level, while the Summary Compensation Table reflects the actual amount earned for 2021.
	As described below under “Long-Term Equity Incentive Compensation – 2021 Stock Option Awards,” for compensation purposes the Committee values stock options differently than the way they are required to be reflected in the Summary Compensation Table.
	Annual target amounts do not count off-cycle awards such as the October 2021 retention restricted share unit awards to Mr. Torres and Mr. Uribe reported in the Summary Compensation Table.
	In setting direct annual compensation targets, the Committee does not include increases in pension or deferred compensation earnings or other compensation, while those amounts are required to be included in the Summary Compensation Table.

Executive Compensation for 2021 Base Salary

To help achieve the objectives discussed above, our executive compensation program for 2021 consists of fixed and performance-based components, as well as short-term and long-term components.

Base Salary

To attract and retain high caliber executives, we pay our executives an annual fixed salary that the Committee considers competitive in the marketplace.

Salary ranges and individual salaries for executive officers are reviewed annually, and salary adjustments generally are effective on April 1 of each year. In determining individual salaries, the Committee considers the salary levels for similar positions at our peer group companies, as well as the executive’s performance, leadership and experience in his or her position. This performance evaluation is based on how the executive performs during the year against results-based objectives established at the beginning of the year and considers their demonstration of executive leadership characteristics. From time to time, if warranted, executives and other employees may receive additional salary increases because of promotions, changes in duties and responsibilities, retention concerns or market conditions.

The Committee approved the following base salaries for our named executive officers:

The Committee increased Mr. Hsu’s and Ms. Henry’s base salaries from 2020 based on peer company data by 5.8 percent and 5.4 percent, respectively. The base salary of each of the other officers was established for 2021 upon a promotion or role expansion based on peer company data for the new role, specifically, Mr. Torres’ promotion to Group President, K-C North America, the expansion Mr. Melucci’s role to include Chief Business Development Officer, and Mr. Uribe’s promotion to President, K-C Latin America (and subsequent July relocation to the U.S.).

Annual Cash Incentive Program

Consistent with our pay-for-performance compensation objective, our executive compensation program includes an annual cash incentive program to motivate and reward executives in achieving annual performance objectives.

2021 Targets

The target payment amount for annual cash incentives is a percentage of the executive’s base salary. The Committee determines this target payment amount as described above under “Setting Annual Compensation – Process for Setting Direct Annual Compensation Targets.” The range of possible payouts is expressed as a percentage of the target payment amount. The Committee sets this range based on competitive factors.

TARGET PAYMENT AMOUNTS AND RANGE OF POSSIBLE PAYOUTS
FOR 2021 ANNUAL CASH INCENTIVE PROGRAM

2021 Performance Goals, Performance Assessments and Payouts

Payment amounts under the annual cash incentive program are dependent on performance measured against corporate goals and business unit or staff function goals established by the Committee at the beginning of each year. These performance goals, which are communicated to our executives at the beginning of each year, are derived from our financial and strategic goals.

As shown in the table below, the Committee established goals for three different performance elements for 2021. It then weighted the three elements for each executive (note that the business unit or staff function performance goals did not apply to our CEO because his responsibilities are company-wide). As it does each year, the Committee chose weightings that are intended to strike an appropriate balance between aligning each executive’s individual objectives with our overall corporate objectives and holding the executive accountable for performance in the executive’s particular area of responsibility.

ANNUAL CASH INCENTIVE PROGRAM 2021 PERFORMANCE GOALS AND WEIGHTS

Below we describe the three elements of performance, explain how performance was assessed for each element, and show the payouts that were determined in each case.

n ELEMENT 1: CORPORATE KEY FINANCIAL GOALS

For 2021, the Committee chose the following as the corporate key financial goals for the annual cash incentive program:

For more information regarding these adjustments, see “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our 2021 Annual Report on Form 10-K.

Because Element 1 represents key company-wide goals, it produces the same payout percentage for each named executive officer based on how Kimberly-Clark performed against the net sales and adjusted EPS goals established in February of each year. For 2021, the Committee set these goals and the corresponding initial payout percentages at the following levels:

Actual results. For 2021, our net sales result was $19.4 billion and our adjusted EPS result was $6.18. Based on these results, the 2021 payout percentage for achieving the corporate key financial goals was 27 percent of each named executive officer’s target payment amount.

n ELEMENT 2: ADDITIONAL CORPORATE FINANCIAL AND STRATEGIC PERFORMANCE GOALS

At the beginning of 2021, the Committee also established additional corporate financial and non-financial strategic performance goals that are intended to challenge our executives to exceed our long-term objectives. At the end of the year, it determined a payout percentage based on its assessment of the degree to which these goals are achieved.

The Committee does not use a formula to assess the performance of these goals but instead takes a holistic approach and considers performance of all the goals collectively. Although it does review each goal separately, the key consideration for the Committee is how it views Kimberly-Clark’s performance for the year in all of these categories, taken as a whole.

The chart below shows the 2021 goals and how the Committee assessed Kimberly-Clark’s performance against each one:

Actual payout percentage. After taking into account performance on all of these goals, the Committee determined that the payout percentage for achieving these other financial and strategic goals should be 142 percent of target.

n ELEMENT 3: BUSINESS UNIT OR STAFF FUNCTION PERFORMANCE GOALS

In addition to the performance goals established by the Committee, our CEO establishes individual business unit or staff function performance goals that are intended to challenge the executives to exceed the objectives for that unit or function. These objectives include strategic performance goals for the business units and staff functions, as well as financial goals for the business units.

Following the end of the year, the executives’ performance is analyzed to determine whether performance for the goals was above target, on target or below target. Our CEO then provides the Committee with an assessment of each individual business unit’s or staff function’s performance against the objectives for that unit or function.

Actual payout percentages. Based on the assessed performance of the relevant business unit or staff function against its pre-established performance goals, and taking into account the CEO’s recommendations, the Committee determined the following payout percentages for business unit or staff function performance for our named executive officers:

Annual Cash Incentive Payouts for 2021

The following table shows the payout opportunities and the actual payouts of annual cash incentives for 2021 for each of our named executive officers. Payouts were based on the payout percentages for each element, weighted for each executive as shown on page 49.

Summary of Annual Cash Incentive Payouts: 2017 through 2021

Generally, the Committee seeks to set the minimum, target and maximum levels such that the relative difficulty of achieving the target level is consistent from year to year. From 2017 through 2021, the average total payout percentage (including business unit or staff function performance) for the executives that were designated as named executive officers in (and were serving as such at the end of) those years ranged from 58 percent to 145 percent of target. The Committee believes that these payouts are consistent with how Kimberly-Clark performed during these years and reflect the pay-for-performance objectives of our executive compensation.

PAYOUTS FOR CORPORATE GOALS AND AVERAGE TOTAL

PAYOUT PERCENTAGES FOR DESIGNATED NAMED EXECUTIVE OFFICERS

Long-Term Equity Incentive Compensation

The Committee awards long-term equity incentive grants to executive officers as part of their overall compensation package. These awards are consistent with the Committee’s objectives of aligning our senior leaders’ interests with the financial interests of our stockholders, focusing on our long-term success, supporting our performance-oriented environment and offering competitive compensation packages.

Information regarding long-term equity incentive awards granted to our named executive officers can be found under “Summary Compensation,” “Grants of Plan-Based Awards,” and “Discussion of Summary Compensation and Plan-Based Awards Tables.”

2021 Grants

In determining the 2021 long-term equity incentive award amounts for our named executive officers, the Committee considered the following factors, among others: the specific responsibilities and performance of the executive, our business performance, retention needs, our stock price performance and other market factors. The Committee did not consider the amount of outstanding equity awards currently held by a named executive officer when making the 2021 annual awards because such amounts represent compensation attributable to prior years.

To determine target values, the Committee considered individual performance and the other factors listed above, as applicable. Target grant values were approved in February 2021 and were divided into two types:

	Performance-based restricted share units (75 percent of the target grant value). For valuation purposes, each unit is assigned the same value as one share of our common stock on the date of grant.
	Stock options (25 percent of the target grant value). For valuation purposes, one option has the same value as 10 percent of the price of one share of our common stock on the date of grant of the stock option.

The Committee believes this allocation between performance-based restricted share units and stock options supports the pay-for-performance and stockholder alignment objectives of its executive compensation program.

In addition to their annual long-term incentive awards, the Committee granted time-vested restricted share awards to Mr. Torres and Mr. Uribe in October 2021, in the case of Mr. Torres, in connection with his promotion to Group President, K-C North America, and in the case of Mr. Uribe, upon his relocation to the U.S. following his November 2020 promotion to President, K-C Latin America.

Performance Goals and Potential Payouts for
2021 - 2023 Performance-Based Restricted Share Units

For the performance-based restricted share unit awards granted in 2021, the actual number of shares to be received by our named executive officers can range from zero to 200 percent of the target levels established by the Committee for each executive, depending on the degree to which the performance objectives for these awards are met over a three-year period.

The performance objectives for the performance-based restricted share unit awards granted in 2021 are based on average annual organic sales growth and modified free cash flow (MFCF) for the period January 1, 2021 through December 31, 2023.

The actual number of shares our named executive officers will receive will range from zero to 200 percent of the target levels established by the Committee for each executive, depending on the degree to which the performance objectives are met. Due to the economic uncertainty caused by the COVID-19 pandemic, the Committee waited until April 2021 to set the performance objective levels.

2021 - 2023 PERFORMANCE-BASED RESTRICTED SHARE UNITS:
POTENTIAL PAYOUTS AT VARYING PERFORMANCE LEVELS

Payout of 2018 - 2020 Performance-Based Restricted Share Units

In February 2021, the Committee evaluated the results of the three-year performance period for the performance-based restricted share units that were granted in 2018. The performance objectives for these 2018 awards were based on average annual adjusted net sales growth and average adjusted return on invested capital (ROIC) for the period January 1, 2018 through December 31, 2020, each weighted equally.

Based on this review, the Committee determined that we exceeded our performance goal for adjusted ROIC but did not achieve our performance goal for adjusted net sales growth. As a result, the payout percentage for the share units was 100 percent of target. The following table includes information about the opportunities and payouts (including reinvested dividends) regarding these grants to our named executive officers: