Good morning, and welcome to the PPG Industries, Inc. Annual Meeting of Shareholders. This webcast is being recorded. At this time, I would like to turn the meeting over to Mr. Michael McGarry. Please go ahead, sir.
Good morning. 2023 Annual Meeting of Shareholders of PPG Industries Incorporated is called to order. I am Michael McGarry, Executive Chairman of the Board. As you know, we are holding this annual meeting of shareholders as a virtual meeting. On behalf of PPG Associates Worldwide and the Board of Directors, I would like to welcome the shareholders of PPG to our 140th annual meeting. I would like to begin this morning by introducing the PPG Board of Directors who are in attendance via electronic means. There are five current directors who are standing for election at this meeting. Steve Angel, Chairman of the Board of Linde PLC. Hugh Grant, Retired Chairman of the Board and Chief Executive Officer of Monsanto Company. Melanie Healey, Former Group President, North America of The Procter & Gamble Company.
Timothy Knavish, President and Chief Executive Officer of PPG Industries, and Guillermo Novo, Chairman and Chief Executive Officer of Ashland Incorporated. The current PPG directors whose terms are continuing are Gary Heminger, Retired Chairman and Chief Executive Officer of Marathon Petroleum Corporation. Michael Lamach, Retired Chairman and Chief Executive Officer of Trane Technologies PLC. Kathleen Ligocki, Former Chief Executive Officer of Agility Fuel Solutions, LLC. Michael Nally, Chief Executive Officer of Generate Biomedicines Incorporated and CEO Partner of Flagship Pioneering. Kathy Smith, Chief Financial and Administrative Officer of Bright Health Group Incorporated. Although he's not able to join today's meeting, Martin Rickenhagen, Retired Chairman, President, and Chief Executive Officer of AGCO Corporation. I would also like to pay special tribute to a director who died unexpectedly in July 2022.
Steven Davis, former Chairman and Chief Executive Officer of Bob Evans Farms Incorporated, was a respected and trusted member of PPG's board and our global family. His invaluable expertise and leadership had a dynamic impact on our organization and will have a lasting legacy. I would also like to recognize Tim Knavish, who's with me for this meeting. In addition to being elected a director of the company in October 2022, the board elected Tim President, Chief Executive Officer beginning in January 2023, when I became Executive Chairman. Also with us for this meeting are Anne Foulkes , Senior Vice President and General Counsel. Vince Morales, Senior Vice President and Chief Financial Officer. Joe Jett, Vice President and Deputy General Counsel and Secretary. Many members of PPG's operating committee and management team are also attending virtually.
The agenda for the meeting was posted on PPG's Investor Relations website and is also being shown on the slide presentation. I'd also like to call your attention to our disclaimer of forward-looking statements, including on the agenda and in the slides. Please note that later in the agenda, there will be an opportunity for questions from shareholders to be answered. If you pre-registered for the meeting using your control number, you should now submit your questions through the internet portal, and we'll try to answer your questions during the time allotted later in the meeting. Mr. Jett will now report on certain official business matters.
Mr. Chairman, the notice of this meeting was made available on a timely basis, commencing March 9, 2023, to all shareholders of record as of the close of business on February 17th, 2023. I am pleased to report that a quorum is present, with approximately 87% of the issued and outstanding common stock being represented at the meeting by proxy, in addition to the stock represented by shareholders attending this meeting through virtual means. Mr. Chairman and shareholders of PPG, this year we again took advantage of Securities and Exchange Commission rules that permitted us to post our proxy materials on the Internet. As part of the fee proxy process, shareholders received a notice informing them that the proxy materials were available on the Internet. Hard copies of materials were provided upon request. Voting was made available online and by telephone again this year.
Thank you, Mr. Jett. Before the meeting, the board of directors appointed three judges of election to act on the matters to come before the meeting. The judges of election are in attendance and have signed the oath of office. They are John Bruno, who will act as Chair, Greg Gordon, and Heidi Zebel. The proxies received from shareholders have been inspected and counted by Corporate Election Services, an independent proxy inspection and tabulation firm. A representative of the firm is in attendance and has certified the results of the proxy vote. We will now proceed with matters to come before this meeting. The first item is the election of certain directors to serve in a class whose term expires in 2025. Nominations are in order.
Mr. Chairman, I nominate the following to serve as directors, each to serve for a term of two years and until their successors shall have been duly elected and qualified or until their earlier retirement or resignation. Steven Angel, Hugh Grant, Melanie Healey, Timothy Knavish, and Guillermo Novo. Further, no written notice was received by the company that any other nomination would be made at this meeting pursuant to the nomination procedures provided for in the company's bylaws.
Thank you. Because no other nominations are in order, the nominations are closed. The second matter to come before the meeting is a proposal to approve the compensation of the company's named executive officers on an advisory basis. The third matter to come before the meeting is a proposal to recommend the frequency with which shareholders shall be entitled to have future advisory votes on executive compensation. The fourth matter to come before the meeting is a proposal to ratify the appointment of PricewaterhouseCoopers LLP as the company's independent registered public accounting firm for 2023.
Mr. Chairman, I move that each of these proposals be submitted to the shareholders for a vote.
Is there a second?
I second the motion.
Thank you. These proposals will be voted on by the shareholders. The board of directors has recommended that shareholders vote for the first, second, and fourth proposals. With regard to the third proposal, the board of directors has recommended that shareholders vote to conduct an advisory vote on executive compensation every year. The final matter to come before the meeting is a shareholder proposal to adopt a policy requiring an independent board chair submitted by the AFL-CIO Equity Index Funds to be presented by Ms. Sheila Lewis. Jess, would you please open and unmute the line of Ms. Lewis?
She is unmuted now.
Good morning, Mr. Chairman, members of the board, and fellow shareholders. My name is Sheila Lewis, and I'm here on behalf of the AFL-CIO Equity Index Fund. I hereby move item number five, which asks that our board have an independent chairman. An independent chairman of the board is one of the key pillars of good corporate governance. This Council of Institutional Investors, CII, which is a nonprofit, nonpartisan association of U.S. public, corporate, and union employee benefit funds, other employee benefit plans, state and local entities charged with investing public assets, and foundations and endowments with combined assets under management of approximately $4 trillion, advocates that boards should be chaired by an independent director. CII states, quote, "Having an independent chair helps the board carry out its primary duty to monitor the management of the company on behalf of its share owners.
A CEO who also serves as chair can exert excessive influence on the board and its agenda, weakening the board's oversight of management. Separating the chair and CEO positions reduces this conflict, and the independent chair provides the clearest separation of power between the CEO and the rest of the board." End quote. Studies show additional benefits to shareholders when the CEO and chair roles are separated. A 2012 GMI study found that companies with independent board chairs paid less in CEO compensation. Five-year shareholder returns at companies that separated the CEO and chair roles also outperformed companies with a unified structure by 28%, the study found.
Another found that in 2006, quote, "All of the underperforming North American CEOs with long tenure had either held the additional title of company Chairman or served under a Chairman who was the former CEO." End quote. A 2011 Brooklyn Law Review study found, quote, "The theoretical argument and empirical evidence, as reflected in financial and non-financial metrics, strongly suggest that a corporate governance structure with a non-executive Chair instead of a dual CEO Chair is better suited to the fulfillment of the directors' fundamental responsibilities to oversee business operations and monitor management for the purpose of enhancing shareholder value." End quote. Leading companies appear to agree. In the past decade, more and more companies are adopting a policy to separate the CEO and Chair roles.
Board research and consulting firm Spencer Stuart reported in its 2020 board index report that 55% of boards have split the chair and CEO roles, compared with 40% in 2010. The report also found 34% of S&P 500 boards have an independent chair, up from 19% a decade ago. An independent chair will ensure our board is independent of management and is effective in its oversight. We urge you to vote in favor of item five. Thank you.
Thank you. Jess, would you please mute the line of Ms. Lewis?
Her line is muted.
Mr. Chairman, I move that this proposal be submitted to the shareholders for a vote.
Is there a second?
Second the motion.
Thank you. This proposal will be voted on by the shareholders. The board of directors has recommended that shareholders vote against this proposal. The polls are now open. For shareholders who are in attendance virtually, if you have already voted online, by phone, or by mail, your vote has been registered, and you do not need to vote again unless you want to change your vote. If you are in attendance virtually, and you registered for the meeting using a control number, you may vote now by clicking on the link on the meeting website, following the instructions and submitting your vote. While shareholders have the opportunity to vote, Mr. Knavish will highlight a few of our key achievements in 2022 and discuss our strategy to drive shareholder value in the near and long term.
You may follow the slides electronically on the portal. Mr. Knavish.
Thank you, Mr. McGarry.
Before I provide the business update, I'd like to take a moment to recognize the outstanding leadership and accomplishments of Michael McGarry, our Executive Chairman, who most recently served as PPG's Chairman and Chief Executive Officer from 2016 through 2022 as part of a stellar 42-year career with the company. Michael has led PPG's continued growth and transformation as one of the world's leading paint, coatings, and specialty materials companies. Under his direction as CEO, PPG made 24 acquisitions. These acquisitions expanded our global reach and strengthened our portfolio in the growing paint and coatings market. These strategic moves, along with Michael's continued focus on PPG's operational excellence, resulted in solid growth and strong financial performance. As shareholders, I think we can all agree that we have been very fortunate to have Michael at the helm of PPG during the last seven years.
We thank him for his many contributions and also for his continued leadership as executive chairman of PPG's board of directors. Please join me in recognizing and thanking Michael. While shareholders have the opportunity to vote, I would like to highlight a few key 2022 achievements and discuss our strategy to drive continued shareholder value. You may follow the slides electronically on the internet portal. For all of us, 2022 continued to present several challenges around the world. This included historic cost inflation, geopolitical issues in Europe, COVID-19 related shutdowns in China, and impacts from supply disruptions and labor shortages. These challenges, however, sharpened our focus on creating increased value for customers, supporting our communities, and delivering results for our shareholders.
That's why I'm very proud and appreciative of our more than 50,000 employees who continue to make it happen and drive our purpose to protect and beautify the world. Throughout last year, we remained focused every day on keeping our people safe and healthy. As we look at our 2022 safety performance, our injury and illness rate was below our expectations. There is more work to do here as we continue to focus on protecting each other every day. Now I'll take a few minutes to review our business highlights from 2022. We achieved record full-year net sales of approximately $17.7 billion, up 5% compared with 2021, and organic sales increased by 8% driven by higher selling prices.
As we look at our own operations, we exited the year with a strong balance sheet that will provide continued financial flexibility as we execute our growth strategy. I encourage you to read about our 2022 performance results and highlights in our recently launched 2022 digital annual report, which can be found at ppg.com. The success of our team's work throughout the year has enabled us to continue to reward our shareholders. In 2022, we raised our annual dividend for the 51st consecutive year and achieved our 123rd year of uninterrupted annual dividends. In total last year, PPG paid $570 million in dividends. We remain among a very small number of companies that have achieved these results and milestones. We are proud to continue this legacy for our shareholders.
In 2022, we continued to strengthen our environmental, social, and governance commitments and performance. This included reducing our greenhouse gas emissions by 13%, lowering our total energy use by 8%, and decreasing our waste disposal intensity by 16% from the 2017 baseline. We also strengthened the governance and board oversight of our ESG program and submitted greenhouse gas emissions reduction targets to the Science-Based Target initiative for validation. This year, we plan to announce new 2030 sustainability goals. We also increased the role that sustainable products play in our portfolio. In 2022, 39% of our total sales came from sustainably advantaged products. One example is our recently launched PPG ENVIRO-PRIME EPIC 200R, which is an automotive corrosion protective coating that cures at lower temperatures, reducing customer energy use and lowering CO2 emissions.
In addition, PPG continued its focus on diversity, equity, and inclusion with actions that included publishing PPG's first DE&I report and new DE&I commitments, scaling our recruiting efforts, and growing global participation in our employee resource networks. I'm proud of our continued ESG progress. Our latest all-digital ESG report is scheduled to publish next month. Despite the many challenges in 2022, our employees continued to make our communities a top priority. Last year, PPG and the PPG Foundation invested $16.2 million globally to support nonprofits, including the more than $9 million to advance education in science, technology, engineering, and math. We have also reached 70% of our commitment to invest $20 million by 2025 to advance racial equality in the U.S. by funding educational pathways for Black communities and people of color.
In addition, our employees last year conducted 87 Colorful Communities projects that brought color and brightness to Schools, community centers, other important places where we live and work. Since 2015, we have completed more than projects in more than 44 countries. Finally, we provided more than $800,000 in humanitarian aid for those affected by the war in Ukraine. After the stock market closes today, we will be announcing our first quarter 2023 results, followed by our quarterly investor call tomorrow morning. I wanna thank all of our global employees who continue to manage through the many challenges, serve our customers, and support our communities in need. I could not be more proud of how our employees have remained focused on looking out for one another and for our stakeholders.
As the economic environment improves, we anticipate having increased opportunities to create additional value for our shareholders, customers, and employees. I'm confident that our team will deliver by focusing on cash generation, margin management, and earnings growth. As we continue to execute our growth strategy, we're also committed to continuing to reward our shareholders. To that end, I am pleased to announce that today our board of directors authorized a per share dividend of $0.62. As I've begun my new role as CEO, I've challenged our team to think big, prioritizing the investments that will differentiate us and move the needle for our customers and our business. We're continuing to look across our organization at ways to innovate for our customers, digitize our businesses, modernize our operations, and energize the PPG team around the world.
I remain very optimistic about the future growth and earnings capability of our company and see many catalysts to return to prior peak operating margins with opportunities to exceed them over time. The PPG team is energized and ready to make it happen. I wanna thank our customers for selecting PPG as their supplier of choice, our shareholders for their confidence and continued investment, and the global PPG team who demonstrates the PPG way by making it happen every day. In 2023, we look forward to continuing to fulfill our purpose: to protect and beautify the world. Thank you. We hope you and your loved ones remain safe and healthy.
Thank you, Mr. Kanevis. The shareholders have now voted. Accordingly, I now declare the polls are closed. We will now have a report from the judges of election on this year's voting matters. Mr. Bruno, please.
Mr. Chairman, on behalf of the judges of election, I present our preliminary voting results showing that the following have been elected directors, each having received the majority of the votes cast. Steven Angel, Hugh Grant, Melanie Healy, Timothy Knavish, and Guillermo Novo. The proposal to approve the compensation of the company's named executive officers on an advisory basis has been approved with 93% of the shares present in person or by proxy voting for the proposal. The shareholders have recommended every year as the frequency with which shareholders shall be entitled to have future advisory role votes on executive compensation with 99% of the shares present or in person or by proxy voting for every year as a recommended frequency.
The proposal to ratify the appointment of PricewaterhouseCoopers LLP as the company's independent registered public accounting firm for 2023 has been approved with 99% of the shares present in person or by proxy voting for the proposal. The shareholder proposal to adopt a policy requiring an independent board chair has not been approved, with less than 40% of the shares present in person or by proxy having voted for the proposal. The final voting results will be filed with the Securities and Exchange Commission within four business days.
There's no other formal business scheduled to come before the meeting, the meeting will now be adjourned. After adjournment, Mr. Knavish will lead the question-and-answer session. May I have a motion to adjourn?
Mr. Chairman, I move that this meeting be adjourned.
Is there a second?
Second the motion.
All those in favor say aye.
Aye.
Any opposed? The meeting stands adjourned. Mr. Knavish will now lead the question-and-answer session based on questions submitted by shareholders through the virtual meeting site.
Thank you, Michael. We will try to answer as many questions as possible but may not have time to get to all of them. That we may respond to as many shareholders as possible, we ask that each shareholder submit no more than two questions. Mrs. Foulkes, please read the first question.
Thank you, Mr. Knavish. The first question comes from Howard Schaefer and reads as follows: The 2023 proxy statement states on page 28 that the Nominating and Governance Committee is charged with reviewing potential conflicts of interest and all related person transactions. The statement then addresses the potential conflict of interest intrinsic in the position of two PPG directors, Mr. Angel and Novo, as chairs and CEOs of two vendors of PPG, Linde plc and Ashland, respectively. Furthermore, the thumbnail biography of Mr. Angel on page 14 states that Linde plc is a global producer and distributor of high-performance surface coatings. Are you able to provide an explanation of why Mr. Angel's employment by a manufacturer of coatings does not constitute a conflict of interest with his obligation as a director of PPG? Thank you.
Mrs. Foulkes, would you please provide an answer to the question?
Yes, Mr. Knavish. Linde plc, the company of which Mr. Angel is chairman of the board, is a supplier of coatings to end markets in which PPG does not participate. Specifically, Linde manufactures coatings for blades in engines. PPG does not participate in this segment, and therefore, we do not believe there's a conflict.
Thank you, Mrs. Foulkes . There being no further questions, this concludes the business of this meeting. Thank you for attending, and more importantly, thank you for your continued interest in and support PPG.
That will conclude today's annual meeting of shareholders. We thank you for your participation. You may disconnect at this time.