The Kroger Co Annual Report 2021

FY2021 Annual Report · The Kroger Co

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Notice of 2022 Annual Meeting of Shareholders

2022 Proxy Statement

and

2021 Annual Report on Form 10-K

Dear Fellow Shareholders:

2021 was a year marked by new victories, new obstacles to be overcome and new milestones
achieved. COVID-19 vaccines restored hope in defeating the pandemic; rising inflation presented new
challenges; and momentum behind environmental, social, and governance (ESG) trends continued to
motivate companies and citizens toward building a better future.

Against this backdrop, Kroger remained focused on our purpose, To Feed the Human Spirit, and

our brand promise, Fresh for Everyone™, by providing America with access to fresh, affordable,
high-quality food.

I’m proud of the way our associates came together to deliver for our customers during a highly
dynamic year. As a team, we navigated an evolving operating environment featuring continued shifts in
customer behaviors — including enthusiasm for e-commerce and a renewed excitement for at-home
eating. Our competitive moats enabled us to convert these structural changes in customer behavior into
lasting competitive advantages that will enable us to drive sustainable growth and profitability for the
long term.

Continued execution of our overarching strategy — Leading with Fresh and Accelerating with
Digital — helped us to achieve a second consecutive year of record performance in 2021. During the
year, we:

• Achieved positive year-over-year identical (ID) sales excluding fuel against very strong ID sales

last year, and a two-year ID sales stack of 14.3%;

• Deepened our four competitive moats: Fresh, Our Brands, Personalization and Seamless,

through productivity, technology and our focus on sustainability;

• Reached $1 billion in annual Home Chef sales, reinforcing our ability to meet the growing

demand for satisfying, restaurant-quality meal options at home that we forecasted years ago;

• Achieved cost savings greater than $1 billion for the fourth consecutive year.

• Invested in our associates to raise our average hourly wage to $17 and our average hourly rate

including comprehensive benefits to over $22; and

• Launched our first three customer fulfillment centers powered by Ocado in Groveland, FL

(Orlando), Monroe, OH (Cincinnati), and Forest Park, GA (Atlanta).

Our strong results are a testament to Kroger’s proven value creation model, which enables us to

invest in our associates, provide fresh, affordable food for our customers and support our
communities — and all of this allows us to deliver for our shareholders.

The foundation of our value creation model is our market-leading omnichannel position in food
retail, built on Kroger’s unique assets, which, combined with our competitive moats, deliver an unmatched
value proposition for our customers. By using our free cash flow to invest in our core retail supermarket
business, we drive additional traffic into our stores and digital channels. In turn, we generate data
that enables us to diversify with fast-growing alternative profit streams. This flywheel effect creates
incredible long-term, sustainable value for shareholders. It gives us confidence to consistently grow
earnings of 3% to 5% per year, return capital to shareholders through our dividend and share repurchases,
and supports our goal to deliver total shareholder returns of between 8%-11% over time.

Our priorities today reflect our long-term focus. We make decisions on a five-to-ten-year horizon.
This is true for our investments and our approach to ESG topics like responsible sourcing. Four years
ago, we were dissatisfied with our average hourly wage rate for associates. We decided to take proactive
steps to identify cost reductions that would allow us to invest in our associates. We’ve since raised
associate wages by $1.2 billion while also keeping the price of food affordable for our customers.

The sections below highlight the progress we have made across our key priorities and how we intend

to continue building on this positive momentum going forward.

Leading with Fresh

As one of our core competitive moats, fresh — and our Fresh for Everyone™ brand promise — fuels

our business every day. We know that our customers love Kroger because they crave fresh foods: it is
the number one determinant of store choice, with 70% of all customers deciding where to shop based on
fresh products. Today, nearly 100% of our customers buy fresh products from Kroger, demonstrating
just how critical this area of the business is for us and our customers.

Throughout the past year, Kroger’s fresh departments have delivered tremendous success,
outpacing total company identical sales excluding fuel during the fourth quarter of 2021. Our fresh
sales have increased 15.6% since 2019, demonstrating our ability to lead with the freshest, highest
quality products.

In 2022, we aim to widen our competitive moat in fresh. We’ll leverage data-driven insights and
food science to improve sourcing, ensuring products are always at the peak of their flavor and quality;
reduce transit time from distribution centers; ensure optimum assortment, price, and promotion of
merchandise; simplify store operations; and more effectively market the freshness of our products to
Kroger customers. We’ll also work to optimize our supply chain, partnering with our suppliers to improve
the distribution process and launching new vendor accountability tools to keep our operations seamless.

Creating a Seamless Customer Experience

We are focused on delivering a seamless experience that requires zero compromise by our

customers. And what that means is leading with the freshest products at competitive prices and flexible
lead times. Our brick-and-mortar model leverages our existing assets to provide fresh products and
meal solutions with proximity and immediacy, while our dedicated facilities can offer a wide assortment
of choices alongside scale and reach to target new customers. We have intentionally structured our
seamless ecosystem to leverage both of these models, forming a dynamic network encompassing our
stores and automated customer fulfillment centers. This approach allows us to capture more trips — from
the planned weekly shop to the unexpected and time-sensitive dinner — as we engage with more
customers, on more occasions, and in both existing and new geographies.

During the year, we expanded our loyalty and personalization platform, successfully generating

over two trillion relevant recommendations, resulting in 50% of items added to baskets because of
personalized search. And, with partners like Ocado, we continue to innovate and bring cutting-edge
and industry-leading technology to improve both the customer and associate experience.

In 2021, we set an ambitious goal of doubling digital sales by the end of 2023 and doubling our
profitability pass-through rate. We’re successfully on track to accomplish these goals thanks to the hard
work of our technology teams and associates, alongside strategic and impactful initiatives that continue
to help us deliver this seamless experience.

Feeding the Human Spirit

There are many ways companies approach ESG matters today. At Kroger, driving sustainability

and social good are not just things that happen alongside our business, they are embedded in the
fabric of our business.

Nowhere is this more evident than in Zero Hunger | Zero Waste, our social and environmental
impact plan established in 2017, through which we are helping create a more resilient and sustainable
future food system. In 2021 alone Kroger directed nearly 500 million meals to feed hungry families across
America, reaching a cumulative 2.3 billion meals toward our goal of providing 3 billion meals to people
in need by 2025. We’ve also delivered on our core 2025 impact goals under Zero Hunger | Zero Waste,
including: 93% of Kroger-operated stores actively donating surplus food (goal: 100%); 87% of stores
have active food waste recycling programs (goal: 100%); and company-wide waste diversion rate of 79%
(goal: 95%+).

We have also continued to prioritize fostering an environment of inclusion in the workplace,

workforce and our communities where the diversity of cultures, backgrounds, experiences, perspectives,

and ideas are valued and appreciated. We continue to make solid progress on our 10-point Framework
for Action: Diversity, Equity & Inclusion (DEI), which reflects our desire to redefine, deepen, and
advance our commitment by mobilizing our people, passion, scale, and resources. One area we are
especially proud of our progress on is in supplier inclusion. We are nearly halfway toward achieving our
goal in the Framework for Action to spend over $10 billion dollars annually with diverse suppliers by
2030. We also made progress in attracting diverse talent from Historically Black Colleges and Universities
and Hispanic-Serving Institutions, increasing from six to 17 our partnerships with these institutions.

Related to our DEI commitments, our Kroger Health practitioners have played an extraordinary

role in administering more than 10 million COVID vaccines to communities of every race, age and
economic background. We take great pride in the role we play in creating accessible healthcare and
helping advance health equity and improved health outcomes for all, including our associates and
customers.

Responsible Sourcing

As the nation’s largest supermarket retailer, Kroger has an extensive supply chain that is constantly
evolving to meet the needs of our customers and communities. This work is guided by our Responsible
Sourcing Framework, which includes 13 policies that embed responsible procurement practices
throughout our value chain, including policies related to respecting human rights and advancing animal
welfare. We implement comprehensive programs to not only hold our suppliers accountable for
meeting Kroger’s high standards, but also to support their continual improvement. We also rely on the
deep knowledge of our category sourcing leaders; the latest data, insights and audit results; and input
from our investors, industry groups, NGOs and subject matter experts.

Kroger’s Responsible Sourcing Framework includes our Animal Welfare Policy, which expresses
our belief that animals should receive proper welfare. Our policy reflects the Five Freedoms, which is
the international standard for higher welfare. We are not directly involved in raising or processing any
animal. Kroger requires animal protein suppliers to adopt industry-accepted animal welfare standards.

Investing in Our Associates

I’m consistently in awe of the patience, generosity, and spirit of our associate community across

the nation. As someone who started my career as an hourly Kroger store associate, I know better than
anyone that providing a superior associate experience empowers us to deliver a better customer
experience every time. In fact, around 70% of our store leaders start out as part time associates.

Kroger has provided an incredible number of people with their first job, new beginnings, and lifelong
careers, and we’re proud to play this role in our communities. When we talk about uplifting our associates,
it certainly includes compensation. In the past four years, we’ve raised our average hourly wage by
25.9%, in addition to the comprehensive benefits we offer such as healthcare and retirement plans,
customized training and advancement opportunities.

Continuing this growing investment in our associates is a priority for 2022 and beyond, and we

expect continued upward movement in the hourly wages in our business model.

We’re also tremendously proud of our continued improvement in workplace safety. We believe our
leading safety results make our stores, manufacturing plants and distribution centers among the safest
places to work in the U.S. As part of our commitment to safe workplaces and a healthy workforce,
we’ve made considerable investments in safeguarding our associates’ overall wellbeing, including
increasing access to mental health resources and providing personal safety training as well as COVID-19
vaccines administered by our Kroger Health experts.

To 2022 and Beyond

2021 was an incredible year for Kroger, characterized by impressive growth, big change, and

restored hope. As we look ahead to 2022 and beyond, I want to take a moment to express my
gratitude — for our associates, customers, and all of you. The community that we have built at and

around Kroger is one of support, respect, innovation, and inspiration. Any victories or successes we
achieve are shared by all.

I believe that one of Kroger’s greatest strengths is our focus on learning and improving every day.
As we embrace a new year and resolve to “expect the unexpected,” the knowledge and wisdom we’ve
gained from these past years will help us continue delivering excellence for our associates, customers,
communities, and shareholders. I’m incredibly optimistic about the future of Kroger and our ability to
deliver for all stakeholders, I look forward to seeing all we can accomplish together, and thank you for
continuing with us on this journey.

Sincerely,

Rodney McMullen
Chairman and CEO, The Kroger Co.

Safe Harbor Statement

This letter contains “forward-looking statements” within the meaning of the safe harbor provisions

of the United States Private Securities Litigation Reform Act of 1995 about future performance of Kroger,
including with respect to Kroger’s ability to achieve sustainable net earnings growth, strategic capital
deployment, strong and attractive total shareholder return, strong free cash flow and ability to increase
the dividend, ability to achieve certain operational goals, among other statements. These statements
are based on management’s assumptions and beliefs in light of the information currently available to it.
These statements are indicated by words such as “will,” “aim,” “model,” “driving,” “enable,” “expect,”
“goal,” “advancing,” “plan,” “continue,” “on track,” “confidence,” and “believe,” as well as similar words or
phrases. These statements are subject to known and unknown risks, uncertainties and other important
factors that could cause actual results and outcomes to differ materially from those contained in the
forward-looking statements, including the specific risk factors identified in “Risk Factors” in Kroger’s
most recent Annual Report on Form 10-K and any subsequent filings with the Securities and Exchange
Commission. Kroger assumes no obligation to update the information contained herein, unless
required to do so by applicable law.

Zero Hunger | Zero Waste: Associate Fundraising Heroes

The Kroger Co. Zero Hunger | Zero Waste Foundation is a nonprofit public charity designed to help
align philanthropy with the company’s Zero Hunger | Zero Waste social and environmental impact plan.
We invite customers of the Kroger Family of Companies to join our journey by rounding up their
purchase to the nearest dollar at checkout to benefit the Zero Hunger | Zero Waste Foundation.

Associate cashiers across the country are leading the way in activating donations through Round

Up. Dollars raised are directed to nonprofit partners that help end hunger and waste in our communities.
These are our 2021 Zero Hero fundraisers:

Atlanta Division
Sandra Branch
Betalhem Tolla

Central Division
Selma Bektas
Carol Dietz
Angela Walker

Cincinnati-Dayton Division
Jen Tudor

Columbus Division
Colleen Burrows
Christy Liff
Beth Tipton

Dallas Division
Anna Louise Fowler
Shah Navin
Candice Peterson

Delta Division
Rickie Hill
Michael McInvale
Sherbert Ware

Dillons Division
Shannon Haley
Pam Meyer
James Moulden

Fred Meyer Division
Anatoliy Bondarchuk
Pat Sears

Fry’s Division
Marlene Hoffman
Dawn Lechner

Houston Division
Debra Van Matre
Gina Wynn

King Soopers Division
Christopher Freeby
Chris Vellos

Louisville Division
Stacey Harrison

Mariano’s Division
Arlene Glazier
Loran Henderson
Cher Herlache

Michigan Division
Falishea Taylor
Steve Strachn
Margie Yankovitch

Mid-Atlantic Division
Dee Dee Hamby

Nashville Division
Linda McMillan
Linda Whitfield

Ralphs Division
John Dailey
Ethelene Scurlark

Roundy’s Division
Sharon Dammann
Nancy Johnson

QFC Division
Amber Brask
Kurt Mincin

Smith’s Division
Sylvia Cronin
Sara Jane
Bobbie Tremayne

(cid:11)(cid:55)(cid:75)(cid:76)(cid:86)(cid:3)(cid:83)(cid:68)(cid:74)(cid:72)(cid:3)(cid:75)(cid:68)(cid:86)(cid:3)(cid:69)(cid:72)(cid:72)(cid:81)(cid:3)(cid:79)(cid:72)(cid:73)(cid:87)(cid:3)(cid:69)(cid:79)(cid:68)(cid:81)(cid:78)(cid:3)(cid:76)(cid:81)(cid:87)(cid:72)(cid:81)(cid:87)(cid:76)(cid:82)(cid:81)(cid:68)(cid:79)(cid:79)(cid:92)(cid:17)(cid:12)

Proxy Summary

This summary highlights information contained elsewhere in this Proxy Statement. It does not
contain all of the information that you should consider. You should read the entire Proxy Statement
carefully before voting.

Overview of Voting Matters and Board Recommendations

Proposals

No. 1 Election of Directors

No. 2 Advisory Vote to Approve
Executive Compensation

No. 3 Ratification of Independent

Auditors

No. 4 Approval of additional shares

under the 2019 Long-Term
Incentive Plan

Nos. 5 – 8 Shareholder Proposals

Corporate Governance Highlights

Board
Recommendation

FOR each
Director Nominee recommended by your Board

FOR

AGAINST
Each Proposal

Kroger is committed to strong corporate governance. We believe that strong governance builds
trust and promotes the long-term interests of our shareholders. Highlights of our corporate governance
practices include the following:

Board Governance Practices

✓ Strong Board oversight of enterprise risk.

✓ Strong experienced independent Lead Director with clearly defined role and responsibilities.

✓ Commitment to Board refreshment and diversity.

✓ 5 of 11 director nominees are women.

✓ The chairs of the Audit, Finance, and Public Responsibilities Committees are women.

✓ Annual evaluation of the Chairman and CEO by the independent directors, led by the

independent Lead Director.

✓ All director nominees are independent, except for the CEO.

✓ All five Board Committees are fully independent

✓ Annual Board and Committee self-assessments conducted by independent Lead Director or

an independent third party.

✓ Regular executive sessions of the independent directors, at the Board and Committee level.

✓ High degree of Board interaction with management to ensure successful oversight and

succession planning.

✓ Balanced tenure.

✓ Robust shareholder engagement program.

✓ Robust code of ethics.

Environmental, Social & Governance (ESG) Practices

✓ Long-standing Board Committee dedicated to ESG oversight — Public Responsibilities

Committee — formed in 1977.

• Amended the Committee Charter in 2021 to more specifically reflect the Committee’s

focused and prioritized approach to material ESG topics related to environmental issues,
sustainability, and social impact.

✓ Annual ESG report, sharing progress on our goals for Zero Hunger | Zero Waste, Just &

Inclusive Economy, Food Waste, Operational Waste, Water, Packaging, Climate Impact, and
Responsible Sourcing.

• The 2021 ESG report represented the 15th year of describing our progress and initiatives

regarding sustainability and other ESG matters.

✓ Committed to transparency in our disclosure, informed by frameworks consistent with

shareholder expectations:

• SASB’s Food Retailers and Distributors Standard.

• GRI Global Sustainability Reporting Standards.

• Task Force on Climate-related Financial Disclosures (TCFD) framework.

✓ Established formal Diversity, Equity & Inclusion (DE&I) Framework for Action to:

• Create a more inclusive culture.

• Develop diverse talent.

• Advance diverse partnerships.

• Advance equitable communities.

• Listen deeply and report progress.

✓ Specifically include diverse candidates in every external executive officer and Board director

search.

✓ Disclose EEO-1 data annually.

Shareholder Rights

✓ Annual director election.

✓ Simple majority standard for uncontested director elections and plurality in contested elections.

✓ No poison pill.

✓ Shareholders have the right to call a special meeting.

✓ Robust, long-standing shareholder engagement program with regular engagements, including
with independent directors, to better understand shareholders’ perspectives and concerns
on a broad array of topics, such as corporate governance and ESG matters.

✓ Adopted proxy access for director nominees, enabling a shareholder, or group of up to 20

shareholders, holding 3% of the Company’s common shares for at least three years to nominate
candidates for the greater of two seats or 20% of Board nominees.

Compensation Governance

✓ Robust clawback and recoupment policy.

✓ Pay program tied to performance and business strategy.

✓ Majority of pay is long-term and at-risk with no guaranteed bonuses or salary increases.

✓ Stock ownership guidelines align executive and director interests with those of shareholders.

✓ Prohibition on all hedging, pledging, and short sales of Kroger securities by directors and

executive officers.

✓ No tax gross-up payments to executives.

ESG Highlights

In 2021, Kroger introduced our Environmental, Social & Governance (ESG) Strategy: Thriving

Together. Our objective is to achieve positive, lasting change through a shared-value framework that
benefits people and our planet and creates more resilient systems for the future. The centerpiece of
Kroger’s ESG strategy is our Zero Hunger | Zero Waste social and environmental impact plan. Introduced
four years ago, Zero Hunger | Zero Waste is an industry-leading platform for collective action and
systems change at global, national and local levels.

Our ESG strategy aims to address material topics of importance to our business and key

stakeholders, including our associates, customers, shareholders, and others. Key ESG topics — informed
by a structured materiality assessment and engagement with our shareholders and NGOs — align to
three strategic pillars: People, Planet and Systems. Please see more details here in Kroger’s annual ESG
Report: https://www.thekrogerco.com/wp-content/uploads/2021/07/Kroger-2021-ESG-Report.pdf. The
information on, or accessible through, this website is not part of, or incorporated by reference into, this
proxy statement.

Director Nominee Highlights

Name

Age*

Primary Occupation

Independent

Nora A. Aufreiter

Kevin M. Brown

Elaine L. Chao

Anne Gates

Karen M. Hoguet

W. Rodney McMullen

(cid:2)

Director Emeritus of
McKinsey & Company

Executive Vice President and
Chief Supply Chain Officer of
Dell Technologies

Former U.S. Secretary of
Transportation and U.S.
Secretary of Labor

Former President of MGA
Entertainment, Inc.

Former Chief Financial
Officer of Macy’s, Inc.

Chairman of the Board
and Chief Executive Officer
of The Kroger Co.

Clyde R. Moore

Ronald L. Sargent

†

J. Amanda Sourry Knox
(Amanda Sourry)

Mark S. Sutton

Ashok Vemuri

Former Chairman of First
Service Networks

(cid:2)

Former Chairman and Chief
Executive Officer of Staples, Inc.

Former President of North
America for Unilever

Chairman and Chief Executive
Officer of International Paper

Former Chief Executive Officer
and Director of Conduent
Incorporated

(cid:2)

Standing Committee Membership

Other
Public
Company
Boards

•

Director
Since

2014

C&T

•

2021

•

2021

2015

2019

2003

1997

2006

2021

2017

2019

•

—

A Audit Committee
C&T Compensation & Talent Development Committee
CG Corporate Governance Committee
F
PR Public Responsibilities Committee

Finance Committee

Member

Committee Chair

Financial Expert

*Age as of record date

Lead Director

2022 Director Nominee Snapshot

Diversity and Tenure

Gender Diversity

Ethnic Diversity

45%
Women

36% of
Board is
ethnically
diverse

Tenure of Director Nominees

7 directors
<5 years

1 director
5-10 years

3 directors
10+ years

Average Tenure is 8.1 years

Skills and Experience

Key Attributes and Skills of All Director Nominees

• High integrity and business ethics

• Knowledge of corporate governance matters

• Strength of character and judgment

• Understanding of the advisory and proactive

• Ability to devote significant time to Board duties

• Desire and ability to continually build expertise
in emerging areas of strategic focus for our
Company

• Demonstrated focus on promoting equality

• Business and professional achievements

• Ability to represent the interests of all

shareholders

oversight responsibility of our Board

• Comprehension of their role as a public

company director and the fiduciary duties owed
to shareholders

• Intellectual and analytical skills

Nora
Aufreiter

Kevin
Brown

Elaine
Chao

Anne
Gates

Karen
Hoguet

Rodney
McMullen

Clyde
Moore

Ronald
Sargent

Amanda
Sourry

Mark
Sutton

Ashok
Vemuri

Total
(of 11)

Business
Management

Retail

Consumer

Financial
Expertise

Risk
Management

Operations &
Technology

ESG

Manufacturing

•

2021 Compensation Highlights

Executive Compensation Philosophy

Executive Summary

We delivered record performance results in 2021. By connecting with customers through
our expanded seamless digital ecosystem and consistent delivery of full, fresh and friendly
customer experience, we successfully navigated dynamic operational environment, labor
and supply chain challenges and achieved record revenue and profitability as demonstrated
by our financial performance results of ID sales of 0.2%, two year stack increased 14.3%,
and adjusted FIFO operating profit of $4.3 Billion1.
Our executive compensation program aligns with long-term shareholder value
creation. 91% of the CEO’s target total direct compensation and, on average, 83% of the
other NEOs’ compensation is at risk and performance based, tied to achievement of
performance targets that are important to our shareholders or our long-term share price
performance.
Annual incentive program design reflected volatile market environment. Our 2021
annual incentive program consisted of two performance periods to maintain the program
rigor amid uncertain business outlook at the start of the year, with more challenging sales
performance goals implemented in the second half of the year.

Annual and long-term performance incentives were earned above target in alignment
with our 2021 performance. The annual cash incentive program that included identical
sales (excluding fuel) and adjusted FIFO operating profit (including fuel) paid out at
approximately 186% of target. Long-term performance unit equity awards granted in 2019
and tied to Restock Kroger savings and benefits, free cash flow and ROIC were earned at
120% of target.
We prioritized investment in our people. We strive to create a culture of opportunity for
more than 450,000 associates and take seriously our role as a leading employer in the
United States. In 2021, we invested more than ever before in our associates by continuing to
raise our average hourly wage to $17 and our average hourly rate to over $22, inclusive of
industry-leading benefits such as continuing education and tuition reimbursement, training
and development, health and wellness. In addition, we continued to invest significantly in the
restructure of pension plans to protect future benefits for our hourly associates.

See pages 33-34 of our Annual Report on Form 10-K for the fiscal year ended January 29, 2022,
filed with the SEC on March 29, 2022, for a reconciliation of GAAP operating profit to adjusted FIFO
operating profit.

In response to our shareholder feedback, we incorporated an ESG metric focused on
diversity and inclusion into our 2022 individual performance management program.
Our core values of Diversity, Equity & Inclusion are incorporated into compensation
decisions made for our associates who supervise a team of others, which range from store
department leaders through our senior officers.

Summary of Key Compensation Practices

To achieve our objectives, the Compensation Committee seeks to ensure that compensation is
competitive and that there is a direct link between pay and performance. To do so, it is guided by the
following principles:

• A significant portion of pay should be performance-based, with the percentage of total pay tied

to performance increasing proportionally with an NEO’s level of responsibility.

• Compensation should include incentive-based pay to drive performance, providing superior pay

for superior performance, including both a short- and long-term focus.

• Compensation policies should include an opportunity for, and a requirement of, significant equity

ownership to align the interests of NEOs and shareholders.

• Components of compensation should be tied to an evaluation of business and individual

performance measured against metrics that directly drive our business strategy and progress
toward our corporate ESG priorities.

• Compensation plans should provide a direct line of sight to company performance.

• Compensation programs should be aligned with market practices.

• Compensation programs should serve to both motivate and retain talent.

The Compensation Committee has three related objectives regarding compensation:

• First, the Compensation Committee believes that compensation must be designed to attract and

retain those individuals who are best suited to be an executive officer at Kroger.

• Second, a majority of compensation should help align the interests of our NEOs with the

interests of our shareholders.

• Third, compensation should create strong incentives for the NEOs to achieve the annual

business plan targets established by the Board, and to achieve Kroger’s long-term strategic
objectives.

Named Executive Officers (NEOs) for 2021

For the 2021 fiscal year ended January 29, 2022, the NEOs were:

Name

Title

W. Rodney McMullen

Chairman and Chief Executive Officer

Gary Millerchip
Stuart W. Aitken
Yael Cosset
Timothy A. Massa

Senior Vice President and Chief Financial Officer
Senior Vice President and Chief Merchandising & Marketing Officer
Senior Vice President and Chief Information Officer
Senior Vice President and Chief People Officer

Fellow Kroger Shareholders:

Notice of 2022 Annual Meeting of Shareholders

We are pleased to invite you to join us for Kroger’s 2022 Annual Meeting of Shareholders
on June 23, 2022 at 11:00 a.m. eastern time. The 2022 Annual Meeting of Shareholders will once
again be a completely virtual meeting conducted via webcast. We believe this is the most
effective approach for enabling the highest possible attendance while also protecting the health
and safety of our shareholders, associates, and community. You will be able to participate in
the virtual meeting online, vote your shares electronically, and submit questions during the
meeting by visiting www.cesonlineservices.com/kr22_vm.

When:

Where:

June 23, 2022, at 11:00 a.m. eastern time.

Webcast at www.cesonlineservices.com/kr22_vm

Items of Business:

1.
2.
3.
4.
5.
6.

To elect 11 director nominees.
To approve our executive compensation, on an advisory basis.
To ratify the selection of our independent auditor for fiscal year 2022.
To approve additional shares under the 2019 Long-Term Incentive Plan
To vote on 4 shareholder proposals, if properly presented at the meeting.
To transact other business as may properly come before the meeting.

Barberry Corp., an activist investment firm affiliated with Carl Icahn
(together with their affiliates, the “Icahn Group”), has notified us of its
intention to propose two director nominees for election at the Annual
Meeting in opposition to the nominees recommended by our Board of
Directors. As a result, you may receive solicitation materials, including a
colored proxy card, from the Icahn Group seeking your proxy to vote for
the Icahn Group’s nominees. The Board of Directors urges you NOT
to sign or return or vote any color proxy card sent to you by the
Icahn Group. If you have already voted using a proxy card sent to you
by the Icahn Group, you can revoke it by: (i) executing and delivering the
WHITE proxy card or voting instruction form, (ii) voting via the Internet
using the Internet address on the WHITE proxy card or voting instruction
form, (iii) voting by telephone using the toll-free number on the WHITE
proxy card or voting instruction form or (iv) voting virtually at the Annual
Meeting. Only your latest dated proxy will count, and any proxy may be
revoked at any time prior to its exercise at the Annual Meeting as
described herein.

Who can Vote:

How to Vote:

Holders of Kroger common shares at the close of business on the record date
April 25, 2022 are entitled to notice of and to vote at the meeting.

YOUR VOTE IS EXTREMELY IMPORTANT NO MATTER HOW MANY
SHARES YOU OWN! Please vote your WHITE proxy in one of the following
ways:

By the internet, you can vote by the Internet by following the instructions
on the enclosed WHITE proxy card or WHITE voting instruction form.

By telephone, you can vote by telephone by following the instructions on
the WHITE proxy card or WHITE voting instruction form.
By mail, you can vote by mail by signing and dating the enclosed WHITE
proxy card or WHITE voting instruction form and returning it in the
postage-paid envelope provided with this proxy statement.
By attending and voting electronically during the virtual Annual Meeting
at www.cesonlineservices.com/kr22_vm.

Shareholders holding shares at the close of business on the record date
may attend the virtual meeting. You will be able to attend the Annual
Meeting, vote and submit your questions real-time during the meeting via
a live audio webcast by visiting www.cesonlineservices.com/kr22_vm and
following the instructions below. There is no physical location for the
Annual Meeting. You may only attend the Annual Meeting virtually.

Attending the
Meeting:

Our Board of Directors unanimously recommends that you vote “FOR ALL” of Kroger’s
director nominees on the WHITE proxy card and “FOR” the management proposals 2 through 4
and “AGAINST” the shareholder proposals 5 through 8.

We appreciate your continued confidence in Kroger, and we look forward to your participation in

our virtual meeting.

If you have any questions or require any assistance, please contact our proxy solicitor:

D.F. King & Co., Inc.
48 Wall Street, 22nd Floor
New York, New York 10005
Brokers and Banks Call Collect: (212) 269-5550
All Others Call Toll-Free: (800) 992-3086
Email: KR@dfking.com

May 2, 2022
Cincinnati, Ohio

By Order of the Board of Directors,
Christine S. Wheatley, Secretary

Proxy Statement

May 2, 2022

We are providing this notice, proxy statement, and annual report to the shareholders of The

Kroger Co. (“Kroger”, “we”, “us”, “our”) in connection with the solicitation of proxies by the Board of
Directors of Kroger (the “Board”) for use at the Annual Meeting of Shareholders to be held on June 23,
2022, at 11:00 a.m. eastern time, and at any adjournments thereof. The Annual Meeting will be held
virtually and can be accessed online at www.cesonlineservices.com/kr22_vm. There is no physical
location for the 2022 Annual Meeting of Shareholders.

Our principal executive offices are located at 1014 Vine Street, Cincinnati, Ohio 45202-1100. Our

telephone number is 513-762-4000. This notice, proxy statement, and annual report, and the
accompanying WHITE proxy card are first being sent or given to shareholders on or about May 2,
2022.

Questions and Answers about the Annual Meeting

Why are you holding a virtual meeting?

We believe a virtual meeting is the most effective approach for enabling the highest possible
attendance while also protecting the health and safety of our shareholders, associates and community.
Therefore, our 2022 Annual Meeting is being held on a virtual-only basis with no physical location.
Our goal for the Annual Meeting is to enable the broadest number of shareholders to participate in the
meeting, while providing substantially the same access and exchange with the Board and Management
as an in-person meeting. We believe that we are observing best practices for virtual shareholder meetings,
including by providing a support line for technical assistance and addressing as many shareholder
questions as time allows.

Who can vote?

You can vote if, as of the close of business on April 25, 2022, the record date, you were a

shareholder of record of Kroger common shares.

Who is the Icahn Group? How are they involved in the Annual Meeting?

The Board does not endorse any of the Icahn Group’s nominees and unanimously
recommends that you vote “FOR ALL” of Kroger’s director nominees and “FOR” each of the
management proposals 2 through 4 and “AGAINST” the shareholder proposals 5 through 8 on
the enclosed WHITE proxy card.

The Board urges you to disregard any materials and NOT to sign, return or vote using any color
proxy card sent to you by or on behalf of the Icahn Group. Voting to “withhold” with respect to any of
the Icahn Group’s director nominees on any color proxy card sent to you by the Icahn Group is not the
same as voting for our director nominees, because a vote to “withhold” with respect to any of the Icahn
Group’s director nominees on the Icahn Group’s proxy card will revoke any WHITE proxy you may
have previously submitted. To support our director nominees, you should vote “FOR ALL” of our director
nominees on the WHITE proxy card.

using the toll-free number on the WHITE proxy card or voting instruction form or (iv) voting virtually at
the Annual Meeting. Only your latest dated proxy will count, and any proxy may be revoked at any time
prior to its exercise at the Annual Meeting as described herein.

Who is asking for my vote, and who pays for this proxy solicitation?

Kroger will pay the cost of the solicitation of proxies by the Company. Kroger’s Board of Directors

and certain of the Company’s regular officers and employees in the ordinary course of their employment
may solicit proxies by mail, Internet, telephone, facsimile, advertisements, personal contact, email, or
other online methods. We will reimburse their expenses for doing this. We also will reimburse banks,
brokers, nominees, and other fiduciaries for postage and reasonable expenses incurred by them in
forwarding the proxy material to beneficial owners of our common shares. Other proxy solicitation
expenses that we will pay include those for preparing, mailing, returning, and tabulating the proxies.

As a result of the potential proxy solicitation by the Icahn Group, we will incur additional costs in

connection with our solicitation of proxies. We have hired D.F. King & Co., Inc. (“D.F. King”) to assist us
in soliciting proxies for a fee estimated not to exceed $4 million. D.F. King expects that approximately 125
of its associates will assist in the solicitation. The total amount to be spent for our solicitation of
proxies from shareholders for the Annual Meeting in excess of that normally spent for an annual meeting
is estimated to be approximately $10 million, approximately $1.5 million of which has been accrued to
date.

Who are the members of the Proxy Committee?

Anne Gates, W. Rodney McMullen, and Ronald L. Sargent, all Kroger Directors, are the members

of the Proxy Committee for our 2022 Annual Meeting.

What is the difference between a “shareholder of record” and a “beneficial shareholder” of
shares held in street name?

You are the “shareholder of record” for any Kroger common shares that you own directly in your

name in an account with Kroger’s stock transfer agent, EQ Shareowner Services.

You are a “beneficial shareholder” of shares held in street name if your Kroger common shares

are held in an account with a broker, bank, or other nominee as custodian on your behalf. The broker,
bank, or other nominee is considered the shareholder of record of these shares. As the beneficial owner,
you have the right to instruct the broker, bank, or other nominee on how to vote your Kroger common
shares.

How do I vote my shares held in street name?

If your shares are held by a bank, broker, or other holder of record, you will receive voting instructions
from the holder of record. Your broker is required to vote your shares in accordance with your instructions.
In most cases, you may vote by telephone or over the internet as instructed.

How do I vote my proxy?

You can vote your proxy in one of the following ways:

1. By the internet, you can vote by the Internet by following the instructions on the enclosed

WHITE proxy card or WHITE voting instruction form.

2. By telephone, you can vote by telephone by following the instructions on the WHITE proxy

card or WHITE voting instruction form.

3. By mail, you can vote by mail by signing and dating the enclosed WHITE proxy card or

WHITE voting instruction form and returning it in the postage-paid envelope provided with this
proxy statement.

4. By voting electronically during the virtual Annual Meeting at

www.cesonlineservices.com/kr22_vm.

If you vote by telephone, via the Internet or by signing, dating, and returning the WHITE proxy
card, your shares will be voted at the Annual Meeting as you direct. If you sign your WHITE proxy card
but do not specify how you want your shares to be voted, they will be voted as the Board recommends.

Why have I received different color proxy cards?

The Icahn Group has notified us that it intends to propose two alternative director nominees for
election at the Annual Meeting in opposition to the nominees recommended by the Board. We have
provided you with the enclosed WHITE proxy card. The Icahn Group may send you a proxy card that is
a different color.

The Board unanimously recommends using the enclosed WHITE proxy card to vote “FOR
ALL” of Kroger’s director nominees. The Board recommends that you simply DISREGARD the
Icahn Group’s proxy card.

If the Icahn Group proceeds with its previously announced nominations, we will likely conduct
multiple mailings prior to the date of the meeting to ensure that shareholders have our latest proxy
information and materials to vote. We will send you a new WHITE proxy card with each mailing,
regardless of whether you have previously voted. We encourage you to vote every WHITE proxy card
you receive. The latest dated proxy you submit will be counted, and, if you wish to vote as recommended
by our Board, then you should only submit WHITE proxy cards.

What documentation must I provide to be admitted to the virtual Annual Meeting and how do I
attend?

In order to attend, you (or your authorized representative) must register in advance at
https://www.cesonlineservices.com/kr22_vm prior to the deadline of June 22, 2022 at 11:00 a.m.
eastern time.

Registering to Attend the Annual Meeting — Shareholders of record.

If you were a shareholder

of record as of the close of business on the record date, you may register to attend the Annual Meeting
by accessing https://www.cesonlineservices.com/kr22_vm and entering the control number provided
on your WHITE proxy card. On the following screen, you should click on the link titled “Click here to pre-
register for the online meeting” at the top of the page.

If you do not have your WHITE proxy card, you may still register to attend the Annual Meeting by

accessing https://www.cesonlineservices.com/kr22_vm, but you will need to provide proof of ownership
of our common shares as of the record date during the registration process. Such proof of ownership
may include a copy of your proxy card received either from the Company or the Icahn Group or a
statement showing your ownership as of the record date.

Registering to Attend the Annual Meeting — Beneficial Owners.

If you were the beneficial owner
of shares (that is, you held your shares in street name through an intermediary such as a broker, bank
or other nominee) as of the record date, you may register to attend the Annual Meeting by accessing
https://www.cesonlineservices.com/kr22_vm and providing evidence during the registration process
that you beneficially owned our common shares as of the record date, which may consist of a copy of
the voting instruction form provided by your broker, bank or other nominee, an account statement or a
letter or legal proxy from such broker, bank or other nominee.

After registering, you will receive a confirmation email prior to the Annual Meeting with a link and

instructions for entering the virtual Annual Meeting.

Although the meeting webcast will begin at 11:00 a.m. eastern time on June 23, 2022, we encourage
you to access the meeting site prior to the start time to allow ample time to log into the meeting webcast
and test your computer system. Accordingly, the Annual Meeting site will first be accessible to registered
shareholders beginning at 10:30 a.m. eastern time on the day of the meeting.

Whether or not you plan to attend the Annual Meeting, we urge you to sign, date and return the

enclosed WHITE proxy card in the postage-paid envelope provided, or vote via the Internet or by
telephone, as instructed on the WHITE proxy card. Additional information and our proxy materials can
also be found at www.viewourmaterial.com/KR. If you have any difficulty following the registration process,
please email KR@dfking.com.

What if I have technical or other “IT” problems logging into or participating in the Annual
Meeting webcast?

All shareholders who register to attend the Annual Meeting will receive an email prior to the

Annual Meeting containing the contact details of technical support in the event they encounter difficulties
accessing the virtual meeting or during the meeting. Shareholders are encouraged to contact technical
support if they encounter any technical difficulties with the meeting webcast. In the event of any
technical disruptions that prevent the chair from hosting the Annual Meeting within 30 minutes of the
date and time set forth above, the meeting may be adjourned or postponed.

What documentation must I provide to vote online at the Annual Meeting?

Shareholders that pre-register for the meeting may also vote during the meeting by clicking on the

“Shareholder Ballot” link that will be available on the meeting website during the meeting.

Shareholders of record may vote directly by simply accessing the available ballot on the meeting

website.

Beneficial owners of shares are encouraged to vote in advance of the meeting. If you intend to
vote during the meeting, as a beneficial shareholder you must obtain a legal proxy from your brokerage
firm or bank. Most brokerage firms or banks allow a shareholder to obtain a legal proxy either online
or by mail. Follow the instructions provided by your brokerage firm or bank. If you have requested a legal
proxy online, and you have not received an email with your legal proxy within two business days of
your request, contact your brokerage firm or bank. If you have requested a legal proxy by mail, and you
have not received it within five business days of your request, contact your brokerage firm or bank.

You may submit your legal proxy either (i) in advance of the meeting by attaching the legal proxy

(or an image thereof in PDF, JPEG, GIF or PNG file format) in an email to proxy@firstcoastresults.com
or (ii) along with your voting ballot during the meeting. We must have your legal proxy in order for
your vote submitted during the meeting to be valid. To avoid any technical difficulties on the day of the
meeting, we encourage you to submit your legal proxy in advance by email to proxy@firstcoastresults.com
to ensure that your vote is counted, rather than wait to upload the legal proxy during the meeting.
Multiple legal proxies must be combined into one document for purposes of uploading them to the
meeting website.

How should I submit my question at the Annual Meeting?

Each year at the Annual Meeting, we hold a question-and-answer session following the formal
business portion of the meeting during which shareholders may submit questions to us. We anticipate
having such a question-and-answer session at the 2022 Annual Meeting. You may submit a question at
the Annual Meeting by typing in the “Ask a Question” box and clicking the “Send” button that will be
available on the meeting website during the meeting, up until the time we indicate that the question-and-
answer session is concluded.

Can I change or revoke my proxy?

The common shares represented by each proxy will be voted in the manner you specified unless
your proxy is revoked before it is exercised. You may change or revoke your proxy at any time before it
is exercised at the Annual Meeting by Internet, telephone, or mail or by voting your shares while logged in
and participating in the 2022 Annual Meeting of Shareholders.

using the Internet address on the WHITE proxy card or voting instruction form, (iii) voting by telephone
using the toll-free number on the WHITE proxy card or voting instruction form or (iv) voting virtually at the
Annual Meeting. Only your latest dated proxy will count, and any proxy may be revoked at any time
prior to its exercise at the Annual Meeting as described herein.

Submitting an Icahn Group proxy card — even if you withhold your vote on the Icahn Group
nominees — will revoke any vote you previously made via our WHITE proxy card. If you wish to
vote pursuant to the recommendation of the Board, you should disregard any proxy card that you
receive that is not a WHITE proxy card and not return any color proxy card that you may
receive from the Icahn Group.

How many shares are outstanding?

As of the close of business on April 25, 2022, the record date, our outstanding voting securities

consisted of 720,938,109 common shares.

How many votes per share?

Each common share outstanding on the record date will be entitled to one vote on each of the 11
director nominees and one vote on each other proposal. Shareholders may not cumulate votes in the
election of directors.

What voting instructions can I provide?

With respect to the election of directors, you may instruct the proxies to vote “For All” or “Withhold
All” for the nominees, or “For All Except” and specify the nominees from whom you withhold your vote.
For all other proposals, you may instruct the proxies to vote “For” or “Against” each proposal, or you may
instruct the proxies to “Abstain” from voting.

What happens if proxy cards or voting instruction forms are returned without instructions?

If you are a registered shareholder and you return your proxy card without instructions, the Proxy

Committee will vote in accordance with the recommendations of the Board.

If you hold shares in street name and do not provide your broker with specific voting instructions
on proposals 1, 2, 4, and 5 - 8. which are considered non-routine matters, your broker does not have
the authority to vote on those proposals. This is generally referred to as a “broker non-vote.” Proposal 3,
ratification of auditors, is usually considered a routine matter and, therefore, in an uncontested
election, your broker may vote your shares according to your broker’s discretion.

However, given the contested nature of the election, if the Icahn Group mails proxy materials to a
beneficial owner, the rules of the New York Stock Exchange (“NYSE”) governing brokers’ discretionary
authority generally do not permit brokers to exercise discretionary authority regarding any of the proposals
to be voted on at the Annual Meeting, whether “routine” or not. Thus, if you receive proxy materials
from the Icahn Group and you do not give instructions to the organization holding your shares, then we
do not expect that organization to be able to vote your shares and, consequently, the shares held by
that organization would not be entitled to vote on any matter to be considered at the Annual Meeting.
Accordingly, we urge you to give instructions to your bank or broker as to how you wish your shares to be
voted so that you may participate in voting on these important matters.

The vote required, including the effect of broker non-votes and abstentions for each of the matters

presented for shareholder vote, is set forth below.

What are the voting requirements and voting recommendation for each of the proposals?

Proposals

No. 1 Election of Directors

Board
Recommendation

FOR each
Director Nominee
recommended by
your Board

No. 2 Advisory Vote to
Approve Executive
Compensation

No. 3 Ratification of

Independent Auditors

No. 4 Approval of additional
shares under the 2019
Long-Term Incentive Plan

FOR

Nos. 5 – 8 Shareholder

Proposals

AGAINST
Each Proposal

Voting Approval
Standard

Effect of
Abstention

Effect of
broker
Non-vote

Plurality of votes cast in
a contested election

If the Icahn Group
proceeds with its
alternative nominations,
the number of director
nominees will be 13,
which exceeds the
number of directors to
be elected. As provided
in our Amended Articles
of Incorporation, in
such a situation, the
11 nominees who
receive the greatest
number of votes cast
will be elected.
Affirmative vote of the
majority of shares
participating in the
voting

Affirmative vote of the
majority of shares
participating in the
voting
Affirmative vote of the
majority of shares
participating in the
voting
Affirmative vote of the
majority of shares
participating in the
voting

No Effect No Effect

What can I do if I have questions?

If you have any questions, please contact D.F. King & Co., Inc., our proxy solicitor assisting us in
connection with the Annual Meeting, by calling toll free (800) 992-3086 or emailing KR@dfking.com.

Background of the Solicitation

The Kroger Board and management team maintain regular communications with shareholders and
other stakeholders on a range of matters, including those related to environmental, social and governance
(ESG), and welcome open engagement.

On Friday, March 25, 2022, Carl Icahn called Rodney McMullen, Chairman and Chief Executive
Officer of the Company, and voiced his concerns regarding animal welfare and the use of gestation
crates in pork production. During the conversation, Mr. Icahn shared his views on Kroger’s commitments
with respect to those issues and indicated that he planned to nominate directors for election to the
Kroger Board at its upcoming Annual Meeting to address such matters.

On Tuesday, March 29, 2022, the Company received correspondence from the Icahn Group

indicating its intent to nominate two director candidates — Alexis C. Fox and Margarita Paláu-
Hernández — for election to the Board at the Annual Meeting. Later that day, the Company issued a
press release of a statement regarding the Icahn Group’s intent to nominate director candidates to the
Kroger Board.

On April 7, 2022, the Company’s outside counsel contacted a representative of the Icahn Group to

inquire about the availability of the Icahn Group’s director nominees to be interviewed by members of
the Corporate Governance Committee of Kroger’s Board of Directors and to request that the director
nominees complete the Company’s prospective director questionnaire.

On April 13, 2022, members of the Corporate Governance Committee, as well as Mr. McMullen,

interviewed each of the Icahn Group’s director nominees.

On April 15, 2022, the Corporate Governance Committee met and discussed the background and

experience of the Icahn Group’s nominees while taking into account the Company’s criteria for evaluating
nominations of candidates for election to the Board as well as the background, skills and experience
of the Company’s nominees for election to the Board and determined not to recommend that either of
the Icahn Group’s nominees be included in the Company’s slate of director nominees at the Annual
Meeting. The Corporate Governance Committee then reported to the full Board on its review of, and
recommendation with respect to, the Icahn Group’s nominees and the Board unanimously determined
not to include the Icahn Group’s nominees in the Company’s slate of director nominees at the Annual
Meeting.

On April 19, 2022, Kroger filed its preliminary Proxy Statement with the SEC.

On May 2, 2022, Kroger filed its definitive Proxy Statement with the SEC.

Kroger’s Corporate Governance Practices

Board Governance Practices

✓ Strong Board oversight of enterprise risk.

✓ Strong experienced independent Lead Director with clearly defined role and responsibilities.

✓ Commitment to Board refreshment and diversity.

✓ 5 of 11 director nominees are women.

✓ The chairs of the Audit, Finance, and Public Responsibilities Committees are women.

✓ Annual evaluation of the Chairman and CEO by the independent directors, led by the

independent Lead Director.

✓ All director nominees are independent, except for the CEO.

✓ All five Board Committees are fully independent.

✓ Annual Board and Committee self-assessments conducted by independent Lead Director or

an independent third party.

✓ Regular executive sessions of the independent directors, at the Board and Committee level.

✓ High degree of Board interaction with management to ensure successful oversight and

succession planning.

✓ Balanced tenure.

✓ Robust shareholder engagement program.

✓ Robust code of ethics.

Environmental, Social & Governance (ESG) Practices

✓ Long-standing Board Committee dedicated to ESG oversight — Public Responsibilities

Committee — formed in 1977.

• Amended the Committee Charter in 2021 to more specifically reflect the Committee’s

focused and prioritized approach to material ESG topics related to environmental issues,
sustainability, and social impact.

✓ Annual ESG report, sharing progress on our goals for Zero Hunger | Zero Waste, Just &

Inclusive Economy, Food Waste, Operational Waste, Water, Packaging, Climate Impact, and
Responsible Sourcing.

• The 2021 ESG report represented the 15th year of describing our progress and initiatives

regarding sustainability and other ESG matters.

✓ Committed to transparency in our disclosure, informed by frameworks consistent with

shareholder expectations:

• SASB’s Food Retailers and Distributors Standard.

• GRI Global Sustainability Reporting Standards.

• Task Force on Climate-related Financial Disclosures (TCFD) framework.

✓ Established formal Diversity, Equity & Inclusion (DE&I) Framework for Action to:

• Create a more inclusive culture.

• Develop diverse talent.

• Advance diverse partnerships.

• Advance equitable communities.

• Listen deeply and report progress.

✓ Specifically include diverse candidates in every external executive officer and Board director

search.

✓ Disclose EEO-1 data annually.

Shareholder Rights

✓ Annual director election.

✓ Simple majority standard for uncontested director elections and plurality in contested elections.

✓ No poison pill.

✓ Shareholders have the right to call a special meeting.

✓ Adopted proxy access for director nominees, enabling a shareholder, or group of up to 20

shareholders, holding 3% of the Company’s common shares for at least three years to nominate
candidates for the greater of two seats or 20% of Board nominees.

Compensation Governance

✓ Robust clawback and recoupment policy.

✓ Pay program tied to performance and business strategy.

✓ Majority of pay is long-term and at-risk with no guaranteed bonuses or salary increases.

✓ Stock ownership guidelines align executive and director interests with those of shareholders.

✓ Prohibition on all hedging, pledging, and short sales of Kroger securities by directors and

executive officers.

✓ No tax gross-up payments to executives.

Environmental, Social & Governance Strategy

In 2021, Kroger introduced our Environmental, Social & Governance Strategy: Thriving Together.

Our objective is to achieve positive, lasting change through a shared-value framework that benefits
people and our planet and creates more resilient systems for the future. The centerpiece of Kroger’s
ESG strategy is our Zero Hunger | Zero Waste social and environmental impact plan. Introduced four years
ago, Zero Hunger | Zero Waste is an industry-leading platform for collective action and systems
change at global, national and local levels.

Our ESG strategy aims to address material topics of importance to our business and key

People — Our Aspiration: Help billions live healthier, more sustainable lifestyles

Food Access, Health & Nutrition

Kroger’s brand promise, Fresh for Everyone, reflects our belief that everyone should have access
to affordable, fresh food. We are committed to food and product safety and to improving food access,
food security, and health and nutrition for all. Protecting our associates’ and customers’ health and safety
and enhancing our shopping experience are also key focus areas.

• Kroger associates rescued nearly 500 million pounds of wholesome surplus food to help end
hunger in the past five years through our Zero Hunger | Zero Waste Food Rescue program.

• In the same period, Kroger directed a total of $1 billion in charitable giving for hunger relief in

our communities.

• With food and funds combined, Kroger directed 2.3 billion meals to our communities since 2017,

well ahead of our goal of 3 billion meals by 2025.

Just & Inclusive Economy

We offer access to employment, benefits and more, providing good jobs for individuals ages 15 to

95 with a wide range of experience, skills and career aspirations. In 2020, Kroger introduced our
Framework for Action: Diversity, Equity and Inclusion, a 10-point plan with short- and long-term steps to
accelerate and promote greater change in the workplace and communities we serve.

• Since 2020, Kroger has trained 500,000 leaders and associates in diversity, equity and inclusion,

including Unconscious Bias training.

• We achieved more than $4 billion in diverse supplier spend annually, on track to our goal of

$10 billion annually by 2030.

• Kroger achieved a perfect score of 100 on the Human Rights Campaign Corporate Equality

Index for the fourth consecutive year and was listed among the Best Places to work for Disability
Inclusion by the Diversity Equality Index.

• The Kroger Co. Foundation established a $5 million Racial Equity Fund subsequently increased
to $10M to support organizations driving change at national and local levels. A first round of
Build It Together grants totaling $3 million supported four organizations: Black Girl Ventures,
Everytable, LISC and the Thurgood Marshall College Fund. A second round of Changemaker
grants totaling $1.1 million will help build black wealth and improve racial health equity with key
partners in Ohio and Tennessee.

Planet — Our Aspiration: Protect and restore natural resources for a brighter future

Climate Impact

Kroger is committed to reducing the impact of our business on our changing climate and assessing
the potential future risk of a changing climate to our business operations. We also support the transition
to a lower-carbon economy by investing in energy efficiency and renewable energy and by reducing
refrigerant emissions and food waste.

• Kroger’s current commitment is to reduce Scope 1 and 2 greenhouse gas (GHG) emissions by

30% by 2030 using a 2018 baseline. Reflecting updated guidance from the Intergovernmental
Panel on Climate Change and the Science Based Targets initiative, Kroger will begin work to
reset this target in 2022 to be more ambitious and align to a 1.50C scenario.

• In addition, Kroger committed to set a new Scope 3 target to reduce GHG emissions in our

value chain. We expect to complete the goal-setting process in 2023.

• Reducing food waste is another way Kroger is helping reduce climate impacts. In 2020, we

reduced retail food waste generated and improved retail food waste diversion from landfill to 48.3%
through our Zero Hunger | Zero Waste plan, on track to achieving 95%+ diversion by 2025.

Resource Conservation

As a responsible business, we conserve natural resources to help safeguard people and our
planet. We remain committed to diverting 90% or more of waste from landfill by 2025 and to identifying
alternative methods of waste management.

• We have a comprehensive set of sustainable packaging goals that include seeking to achieve

100% recyclable, reusable or compostable packaging for Our Brands products by 2030.

• Kroger partnered with TerraCycle to launch a first-of-its-kind recycling program for flexible plastic
packaging across the Our Brands portfolio. Now Kroger customers can collect flexible snack
and chip bags, pouches, pet food packaging and more — items typically not eligible for curbside
recycling — for easy and free mail-in recycling.

• As the exclusive U.S. grocery retail partner for Loop, Kroger helped introduce this innovative

reusable consumer product packaging platform to our shoppers. Loop items are currently available
in a pilot at 25 Fred Meyer stores in the Portland, Oregon, area.

• To support more sustainable agriculture, Kroger offers an expanding selection of natural,

organic, free-from and plant-based products, including our popular Simple Truth® product line.

Systems — Our Aspiration: Build more responsible and inclusive global systems

Business Integration

Kroger is committed to strong corporate and ESG governance. Business and functional leaders

are engaged in our ESG strategy and accountable for results. Operationalizing ESG is a journey;
however, we believe our centralized structure, vertical integration and commitment to responsible
sourcing enables our progress.

• In the past year, Kroger updated its Board of Directors Committee charters to reflect the priority

that the Board places on ESG topics.

• We are committed to Board refreshment and diversity, with five of 11 directors being women,

including the chairs of the Audit, Finance, and Public Responsibilities Committees and four of 11
directors identifying as racially/ethnically diverse.

• A core ESG team leads internal cross-functional working groups focused on policy, issues

management and strategy implementation for key ESG topics, including animal welfare, climate
impacts, food access, responsible sourcing, and sustainable packaging.

Responsible & Resilient Systems

As a grocery retailer, Kroger is part of and dependent on an interconnected global food system
and consumer goods supply chain. A renewed focus on these natural systems and the policies and
practices governing them will help protect our planet and workers whose livelihoods depend on a resilient
and responsible supply chain.

• Kroger committed to align our policy to respect human rights with the UN Guiding Principles on

Business and Human Rights and create a comprehensive human rights due diligence framework
and roadmap for implementation.

• We continue to increase the volume of Fair Trade Certified ingredients and finished products

sourced for Our Brands products to support communities around the world.

• Kroger updated its animal welfare policy to support the five freedoms of animal welfare, continued
to engage in open dialogue with animal welfare stakeholders on chicken, sow and dairy cow
welfare, and joined the Global Coalition for Animal Welfare, which convenes food retailers, food
service providers, producers, and animal welfare experts to improve standards at scale and
promote good welfare.

• Our long-standing commitment to seafood sustainability includes partnerships and programs

aimed at improving marine ecosystems through conservation and fishery improvement practices.

• Kroger’s No-Deforestation Commitment for Our Brands aims to address deforestation impacts in

higher-risk supply chains, such as palm oil, pulp and paper, soy, and beef.

Proposals to Shareholders

Item No. 1. Election of Directors

You are being asked to elect 11 director nominees for a one-year term.

FOR

The Board of Directors unanimously recommends that you vote “FOR ALL” of Kroger’s
director nominees.

Standing Committee Membership

Other
Public
Company
Boards

Name

Age*

Primary Occupation

Independent

Nora A. Aufreiter

Kevin M. Brown

Elaine L. Chao

Anne Gates

Karen M. Hoguet

W. Rodney McMullen

(cid:2)

Director Emeritus of
McKinsey & Company

Executive Vice President and
Chief Supply Chain Officer of
Dell Technologies

Former U.S. Secretary of
Transportation and U.S.
Secretary of Labor

Former President of MGA
Entertainment, Inc.

Former Chief Financial
Officer of Macy’s, Inc.

Chairman of the Board
and Chief Executive Officer
of The Kroger Co.

Clyde R. Moore

Ronald L. Sargent

†

J. Amanda Sourry Knox
(Amanda Sourry)

Mark S. Sutton

Ashok Vemuri

Former Chairman of First
Service Networks

(cid:2)

Former Chairman and Chief
Executive Officer of Staples, Inc.

Former President of North
America for Unilever

Chairman and Chief Executive
Officer of International Paper

Former Chief Executive Officer
and Director of Conduent
Incorporated

(cid:2)

•

Director
Since

2014

C&T

•

2021

•

2021

2015

2019

2003

1997

2006

2021

2017

2019

•

A Audit Committee
C&T Compensation & Talent Development Committee
CG Corporate Governance Committee
F
PR Public Responsibilities Committee

Finance Committee

Member

Committee Chair

Financial Expert

*Age as of record date

Lead Director

—

As of the date of this proxy statement, Kroger’s Board of Directors consists of 11 members. All
nominees, if elected at the 2022 Annual Meeting, will serve until the annual meeting in 2023, or until
their successors have been elected by the shareholders or by the Board pursuant to Kroger’s Regulations,
and qualified. Each of our director nominees identified in this proxy statement has consented to being
named as a nominee in our proxy materials and has accepted the nomination and agreed to serve as a
director if elected by Kroger’s shareholders.

Kroger’s Articles of Incorporation provide that the vote required for election of a director nominee

by the shareholders, except in a contested election or when cumulative voting is in effect, is the
affirmative vote of a majority of the votes cast for or against the election of a nominee. However, in a
contested election where there are more nominees for election than positions on the Board to be filled,
the vote required for election of a director nominee is a plurality of the votes cast. The Icahn Group
notified Kroger that it intends to nominate two candidates for election as directors at the Annual Meeting.
If the Icahn Group proceeds with its alternative nomination, the number of director nominees will
exceed the number of directors to be elected and, as a result, the 11 nominees who receive the greatest
number of votes cast will be elected.

The Board does NOT endorse any of the Icahn Group’s nominees and recommends that
you simply DISREGARD any materials, including any color proxy card, that may be sent to you
by the Icahn Group and only vote using the enclosed WHITE proxy card. Please note that voting to
“withhold” with respect to any of the Icahn Group’s nominees on any color proxy card sent to you by
the Icahn Group is not the same as voting for the Board’s nominees, because a vote to “withhold” with
respect to any of the Icahn Group’s nominees on the Icahn Group’s proxy card will revoke any WHITE
proxy you may have previously submitted. To support the Board’s nominees, you should vote
“FOR ALL” Kroger’s director nominees on the WHITE proxy card.

If you have already voted using a proxy card sent to you by the Icahn Group, you can revoke it by:
(i) executing and delivering the WHITE proxy card or voting instruction form, (ii) voting via the Internet
using the Internet address on the WHITE proxy card or voting instruction form, (iii) voting by telephone
using the toll-free number on the WHITE proxy card or voting instruction form or (iv) voting virtually at
the Annual Meeting. Only your latest dated proxy will count, and any proxy may be revoked at any time
prior to its exercise at the Annual Meeting as described herein.

If you have any questions, please contact D.F. King & Co., Inc., our proxy solicitor assisting us in
connection with the Annual Meeting, by calling toll free (800) 992-3086 or emailing KR@dfking.com.

The Committee memberships stated below are those in effect as of the date of this proxy statement.
The experience, qualifications, attributes, and skills that led the Corporate Governance Committee and
the Board to conclude that the following individuals should serve as directors are set forth opposite
each individual’s name. In addition, all of our Director Nominees demonstrate the following qualities:

Key Attributes and Skills of All Kroger Director Nominees

• High integrity and business ethics

• Knowledge of corporate governance matters

• Strength of character and judgement

• Understanding of the advisory and proactive

oversight responsibility of our Board

• Comprehension of their role as a public

company director and the fiduciary duties owed
to shareholders

• Intellectual and analytical skills

• Ability to devote significant time to Board duties

• Desire and ability to continually build expertise
in emerging areas of strategic focus for our
Company

• Demonstrated focus on promoting equality

• Business and professional achievements

• Ability to represent the interests of all

shareholders

Board Nominees for Directors for Terms of Office Continuing until 2023

Age
62

Director Since
2014

Committees:
Finance
Public Responsibilities*

Qualifications:
Busines Management
Retail
Consumer
Financial Expertise
Operations & Technology
ESG

Nora A. Aufreiter

Ms. Aufreiter is Director Emeritus of McKinsey & Company, a global
management consulting firm. She retired in June 2014 after more than
27 years with McKinsey, most recently as a director and senior partner.
During that time, she worked extensively in the U.S., Canada, and
internationally with major retailers, financial institutions, and other
consumer-facing companies. Before joining McKinsey, Ms. Aufreiter
spent three years in financial services working in corporate finance and
investment banking. She is a member of the Board of Directors of The
Bank of Nova Scotia and is chair of the Board of Directors of MYT
Netherlands Parent B.V., the parent company of MyTheresa.com, an
e-commerce retailer. She is also on the board of a privately held
company, Cadillac Fairview, a subsidiary of Ontario Teachers Pension
Plan, which is one of North America’s largest owners, operators, and
developers of commercial real estate. Ms. Aufreiter also serves on the
boards of St. Michael’s Hospital and the Canadian Opera Company, and
is a member of the Dean’s Advisory Board for the Ivey Business School
in Ontario, Canada.

Ms. Aufreiter has over 30 years of broad business experience in a variety
of retail sectors. Her vast experience in leading McKinsey’s North
American Retail Practice, North American Branding service line and the
Consumer Digital and Omnichannel service line is of particular value to
the Board. In addition, during her tenure with McKinsey, the firm advised
consulting clients on a variety of matters, including ESG topics and
setting and achieving sustainability goals which is of value to the Board
and the Public Responsibilities Committee. Ms. Aufreiter has served on
our Public Responsibilities Committee for seven years, the last two as
chair. In 2021, she led the Board’s review of ESG accountability to clarify
committee oversight of ESG topics and led the revision of the
Committee’s charter to reflect the Committee’s increasing focus on
material environmental sustainability and social impact topics. She also
brings to the Board valuable insight on commercial real estate. In her
role as Chair of the Corporate Governance Committee of Bank of Nova
Scotia, Ms. Aufreiter has responsibility for overseeing shareholder
engagement, the composition of its Board of Directors, including
diversity, the effectiveness of the diversity policy of its Board of Directors,
ESG strategy and priorities, and the Bank’s statement on human rights.
This experience is of particular value to the Board and to her role as the
Chair of the Public Responsibilities Committee.

Kevin M. Brown

Mr. Brown is the Executive Vice President and Chief Supply Chain
Officer at Dell Technologies, a leading global technology company. His
previous roles at Dell include senior leadership roles in procurement,
product quality, and manufacturing. Mr. Brown joined Dell in 1998 and
has held roles of increasing responsibility throughout his career,
including Chief Procurement Officer and Vice President, ODM
Fulfillment & Supply Chain Strategy before being named Chief Supply
Chain Officer in 2013. Before Dell, he spent 10 years in the shipbuilding
industry, directing U.S. Department of Defense projects. Mr. Brown
currently serves on the National Committee of the Council on Foreign
Relations and on the Boards of the Congressional Black Caucus
Foundation and the Howard University Center for Supply Chain
Excellence. He is also a member of the Executive Leadership Council.

Mr. Brown is a global leader with over twenty years of leadership
experience and supply chain innovation experience. His efforts led Dell
to be recognized as having one of the most efficient, sustainable, and
innovative supply chains. Mr. Brown has established himself as an
authority on sustainable business practices. His combined deep global
supply chain and procurement expertise and track record of
sustainability and resilience leadership, as well as his experience in
circular economic business practices, are of value to the Board in his
role as director and member of the Public Responsibilities Committee.
His deep expertise in all matters related to supply chain, supply chain
resilience, and risk and crisis management are of particular value to the
Board.

Age
59

Director Since
2021

Committees:
Audit
Public Responsibilities

Qualifications:
Business Management
Consumer
Financial Expertise
Risk Management
Operations & Technology
ESG
Manufacturing

Age
69

Director Since
2021

Committees:
Corporate Governance
Public Responsibilities

Qualifications:
Business Management
Consumer
Financial Expertise
Risk Management
Operations & Technology
ESG

Elaine L. Chao

Ms. Chao served as the 18th U.S. Secretary of Transportation from
January 2017 until January 2021. Prior thereto, she served as the 24th
U.S. Secretary of Labor from January 2001 until January 2009, and was
the first woman of Asian American & Pacific Islander heritage to serve in
a President’s cabinet in history. Previously, Ms. Chao was President and
CEO of United Way of America, Director of the Peace Corps and a
banker with Citicorp and BankAmerica Capital Markets Group. She
earned her M.B.A. from Harvard Business School and has served on a
number of Fortune 500 and nonprofit boards. She currently serves on
the Board of Directors of ChargePoint Holdings, Inc., Embark
Technology, Inc., and Hyliion Holdings Corp., all of which are new
economy technology companies in the mobile sector focusing on
sustainable and environmentally friendly transportation. Recognized for
her extensive record of accomplishments and public service, she is also
the recipient of 37 honorary doctorate degrees. In her capacity as a
director on numerous public boards while out of government, she has
advocated for innovation and business transformations. She has also
been a director on many private and nonprofit boards, including Harvard
Business School Board of Dean’s Advisors and Global Advisory Board,
and a trustee of the Kennedy Center for the Performing Arts.

Ms. Chao brings to the Board extensive experience in the public, private
and non-profit sectors. In her two cabinet positions, she led high-profile
organizations, navigating complex regulatory and public policy
environments, and she provides the Board with valuable insight on
strategy, logistics, transportation, and workforce issues. Under her
leadership, the Department of Labor set up a record number of health
and safety partnerships with labor unions. While she was Director of the
Peace Corps, she launched the first Peace Corps programs in the newly
independent Baltic states, Ukraine, and the former republics of the
former Soviet Union. This experience leading social impact at scale is of
value to the Board in her role as an independent director and member of
the Public Responsibilities Committee. Ms. Chao’s leadership and
governance expertise gained from her government service, nonprofits
and public company boards is of value to the Board.

Age
62

Director Since
2015

Committees:
Audit*
Corporate Governance

Qualifications:
Business Management
Retail
Consumer
Financial Expertise
Risk Management
Operations & Technology
ESG
Manufacturing

Anne Gates

Ms. Gates was President of MGA Entertainment, Inc., a privately-held
developer, manufacturer, and marketer of toy and entertainment products
for children, from 2014 until her retirement in 2017. Ms. Gates held roles
of increasing responsibility with The Walt Disney Company from
1992-2012. Her roles included Chief Financial Officer for Disney
Consumer Products (DCP) and Managing Director, DCP, Europe and
emerging markets. She is currently a director of Tapestry, Inc., where
she serves as Chair of the Board, Chair of the Governance Committee,
and is on the Tapestry Foundation Board. She is also a director of
Raymond James Financial, Inc., where she is the Chair of the Corporate
Governance ESG Committee. She is also a member of the Boards of the
Salzburg Global Seminar, PBS SoCal, and the Packard Foundation, one
of the largest global foundations focused on environmental and other key
ESG issues.

Ms. Gates has over 25 years of experience in the retail and consumer
products industry. She brings to Kroger financial expertise gained while
serving as President of MGA and CFO of a division of The Walt Disney
Company. Ms. Gates has a broad business background in finance,
marketing, strategy and business development, including international
business. As the chair of the Corporate Governance and ESG
Committee at Raymond James Financial, Inc., she oversees their code of
ethics, Board composition, including diversity, environmental policies and
programs, sustainability targets and ESG reporting which are aligned
with SASB, shareholder proposals, and shareholder engagements
efforts, including social justice, community relations and charitable
giving. Ms. Gates is also Chair of the Tapestry Governance Committee,
which also includes oversight of ESG responsibilities. These experiences
are of particular value to the Board in her role as an independent director
and member of the Corporate Governance Committee. Her financial
leadership and consumer products expertise is of particular value to the
Board. Ms. Gates has been designated an Audit Committee financial
expert and serves as Chair of the Audit Committee.

Age
65

Director Since
2019

Committees:
Audit
Finance*

Qualifications:
Business Management
Retail
Consumer
Financial Expertise
Risk Management
ESG

Karen M. Hoguet

Ms. Hoguet served as the Chief Financial Officer of Macy’s, Inc. from
October 1997 until July of 2018 when she became a strategic advisor to
the Chief Executive Officer until her retirement in 2019. Ms. Hoguet
serves on the Board of Directors of Nielsen Holdings plc. Previously, she
served on the boards of The Chubb Corporation and Cincinnati Bell as a
member of the Audit and Finance Committees and the Audit Committee,
respectively. She also serves on the boards of Hebrew Union College
and UCHealth.

Ms. Hoguet has over 35 years of broad financial and operational
leadership experience within the omnichannel retail sector. She has a
proven track record of success in driving transformations, delivering
strong financial performance, and forming strong relationships with
investors and industry analysts. She has extensive knowledge across all
areas of finance, including financial planning, investor relations, M&A,
accounting, treasury and tax, as well as strategic planning, credit card
services and real estate. Ms. Hoguet played a critical role in the
successful turnaround of Federated Department Stores, from bankruptcy
to an industry leading omnichannel retailer, which was accomplished
through acquisitions, divestiture and other strategic changes including
building an omnichannel model and developing a new strategic approach
to real estate. Her long tenure as a senior executive of a publicly traded
company with financial, audit, strategy, and risk oversight experience is of
value to the Board as is her public company experience, both as a long
serving executive, and as a board member. In addition, her strong
business acumen, understanding of diverse cross-functional issues, and
ability to identify potential risks and opportunities are also of value to the
Board. Ms. Hoguet has been designated an Audit Committee financial
expert and serves as Chair of the Finance Committee.

W. Rodney McMullen

Mr. McMullen was elected Chairman of the Board in January 2015 and
Chief Executive Officer of Kroger in January 2014. He served as
Kroger’s President and Chief Operating Officer from August 2009 to
December 2013. Prior to that, Mr. McMullen was elected to various roles
at Kroger including Vice Chairman in 2003, Executive Vice President,
Strategy, Planning, and Finance in 1999, Senior Vice President in 1997,
Group Vice President and Chief Financial Officer in June 1995, and Vice
President, Planning and Capital Management in 1989. He is a director of
VF Corporation. In the past five years, he also served as a director of
Cincinnati Financial Corporation.

Mr. McMullen has broad experience in the supermarket business, having
spent his career spanning over 40 years with Kroger. He has a strong
background in finance, operations, and strategic partnerships, having
served in a variety of roles with Kroger, including as our CFO, COO, and
Vice Chairman. His previous service as chair of Cincinnati Financial
Corporation’s compensation committee and on its executive and
investment committees, as well as his service on the audit and
governance and corporate responsibilities committees of VF
Corporation, adds depth to his extensive retail experience.

Age
61

Director Since
2003

Qualifications:
Business Management
Retail
Consumer
Financial Expertise
Risk Management
Operations & Technology
ESG

Age
68

Director Since
1997

Committees:
Compensation & Talent
Development*
Corporate Governance

Qualifications:
Business Management
Financial Expertise
Risk Management
Operations & Technology
ESG
Manufacturing

Clyde R. Moore

Mr. Moore was Chairman and Chief Executive Officer of First Service
Networks, a national provider of facility and maintenance repair services,
from 2000 to 2014, and Chairman until his retirement in 2015. Previously,
Mr. Moore was President and CEO of Thomas & Betts, a global
manufacturer of electric connectors and components, and President and
COO of FL Industries, Inc., an electrical component manufacturing
company. Mr. Moore is currently President and CEO of Gliocas LLC, a
management consulting firm serving small businesses and non-profits.
Mr. Moore was a leader in the founding of the Industry Data Exchange
Association (IDEA), which standardized product identification data for the
electrical industry, allowing the industry to make the successful transition
to digital commerce. Mr. Moore was Chairman of the National Electric
Manufacturers Association and served on the Executive Committee of
the Board of Governors. He served on the advisory board of Mayer
Electrical Supply for over 20 years, including time as lead director, until
the sale of the company in late-2021.

Mr. Moore has over 30 years of general management experience in
public and private companies. He has extensive experience as a
corporate leader overseeing all aspects of a facilities management firm
and numerous manufacturing companies. Mr. Moore’s expertise
broadens the scope of the Board’s experience to provide oversight to
Kroger’s facilities, digital, and manufacturing businesses, and he has a
wealth of Fortune 500 experience in implementing technology
transformations. Additionally, his expertise and leadership as Chair of the
Compensation Committee is of particular value to the Board. Mr. Moore
presided over the Compensation Committee during the company’s
introduction of its Framework for Action: Diversity, Equity and Inclusion
plan. Additionally, he was Chair of the Compensation Committee and led
the inclusion of talent development into the Committee’s name and
charter.

Ronald L. Sargent

Mr. Sargent was Chairman and Chief Executive Officer of Staples, Inc., a
business products retailer, where he was employed from 1989 until his
retirement in 2017. Prior to joining Staples, Mr. Sargent spent 10 years
with Kroger in various positions. He is a director of Five Below, Inc. and
Wells Fargo & Company. Previously, he served as a director of The
Home Depot, Inc. and Mattel, Inc. Currently, Mr. Sargent is a member of
the board of governors of the Boys & Girls Clubs of America, the board
of directors of City of Hope, and the board of trustees of Northeastern
University. He is also chairman of the board of directors of the John F.
Kennedy Library Foundation.

Mr. Sargent has over 35 years of retail experience, first with Kroger and
then with increasing levels of responsibility and leadership at Staples,
Inc. His efforts helped carve out a new market niche for the international
retailer. In his role as Chair of the Wells Fargo Human Resources
Committee, he oversees human capital management, including diversity,
equity, and inclusion, human capital risk, and culture and ethics. In his
role as a member of the Five Below Nominating and Corporate
Governance Committee, he oversees social and environmental
governance, including corporate citizenship. These committee
experiences are of value to the Board in his role as a member of the
Public Responsibilities Committee and Lead Director of the Board. His
understanding of retail operations, consumer insights, and e-commerce
are also of value to the Board. Mr. Sargent has been designated an Audit
Committee financial expert and serves as Chair of the Corporate
Governance Committee and Lead Director of the Board. Mr. Sargent’s
strong insights into corporate governance and his executive leadership
experience serve as the basis for his leadership role as Lead Director.

Age
66

Director Since
2006

Committees:
Audit
Corporate Governance*
Public Responsibilities

Qualifications:
Business Management
Retail
Consumer
Financial Expertise
Risk Management
Operations & Technology
ESG

Age
58

Director Since
2021

Committees:
Compensation & Talent
Development Finance

Qualifications:
Business Management
Retail
Consumer
Financial Expertise
Risk Management
Operations & Technology
ESG

J. Amanda Sourry Knox (Amanda Sourry)

Ms. Sourry was President of North America for Unilever, a personal care,
foods, refreshment, and home care consumer products company, from
2018 until her retirement in December 2019. She held leadership roles of
increasing responsibility during her more than 30 years at Unilever, both
in the U.S. and Europe, including president of global foods, executive
vice president of global hair care, and executive vice president of the
firm’s UK and Ireland business. From 2015 to 2017, she served as
President of their Global Foods Category. Ms. Sourry currently serves on
the board for PVH Corp., where she chairs the Compensation Committee
and serves on the Nominating, Governance & Management
Development Committee. She is also a non-executive director of OFI, a
provider of on-trend, natural and plant-based products, focused on
delivering sustainable and innovative solutions to consumers across the
world, and a member of their Remuneration and Talent Committee and
the Audit and Risk Committee. She is also a supervisory director of
Trivium Packaging, a sustainable packaging company.

Ms. Sourry has over thirty years of experience in the CPG and retail
industry. As a member of PVH Corp.’s Nominating, Governance &
Management Development Committee, her experience with monitoring
issues of corporate conduct and culture, and providing oversight of
diversity, equity and inclusion policies and programs as it relates to
management development, talent assessment and succession planning
programs and processes is of particular value to her role as a member of
the Compensation & Talent Development Committee and the Board. She
brings to the Board her extensive global marketing and business
experience in consumer-packaged goods as well as customer
development, including overseeing Unilever’s digital efforts. Ms. Sourry
was actively involved in Unilever’s global diversity, gender balance, and
sustainable living initiatives which is of value to the Board and to the
Compensation & Development Committee. She also has a track record
of driving sustainable, profitable growth across scale operating
companies and global categories across both developed and emerging
markets. Ms. Sourry’s history in profit and loss responsibility and
oversight, people and ESG leadership and capabilities development is of
value to the Board.

Mark S. Sutton

Mr. Sutton is Chairman and Chief Executive Officer of International
Paper, a leading global producer of renewable fiber-based packaging,
pulp, and paper products. Prior to becoming CEO in 2014, he served as
President and Chief Operating Officer with responsibility for running
International Paper’s global business. Mr. Sutton joined International
Paper in 1984 as an Electrical Engineer. He held roles of increasing
responsibility throughout his career, including Mill Manager, Vice
President of Corrugated Packaging Operations across Europe, the
Middle East and Africa, Vice President of Corporate Strategic Planning,
and Senior Vice President of several business units, including global
supply chain. Mr. Sutton is a member of The Business Council, serves
on the American Forest & Paper Association board of directors, and the
Business Roundtable board of directors. He also serves on the board of
directors of Memphis Tomorrow.

Mr. Sutton has over thirty years of leadership experience with increasing
levels of responsibility and leadership at International Paper. At
International Paper, he oversees their robust ESG disclosures which are
aligned with GRI, and their Vision 2030, which sets forth ambitious forest
stewardship targets and plans to transition to renewable solutions and
sustainable operations. He also oversees International Paper’s Vision
2030 goals pertaining to diversity and inclusion. He brings to the Board
the critical thinking that comes with an electrical engineering background
as well as his experience leading a global company with labor unions.
His strong strategic planning background, manufacturing and supply
chain and experience, and his ESG leadership are of value to the Board.

Age
60

Director Since
2017

Committees:
Compensation & Talent
Development
Finance

Qualifications:
Business Management
Financial Expertise
Risk Management
Operations & Technology
ESG
Manufacturing

Ashok Vemuri

Mr. Vemuri was Chief Executive Officer and a Director of Conduent
Incorporated, a global digital interactions company, from its inception as
a result of the spin-off from Xerox Corporation in January 2017 to 2019.
He previously served as Chief Executive Officer of Xerox Business
Services, LLC and as an Executive Vice President of Xerox Corporation
from July 2017 to December 2017. Prior to that, he was President, Chief
Executive Officer, and a member of the Board of Directors of IGATE
Corporation, a New Jersey-based global technology and services
company now part of Capgemini, from 2013 to 2015. Before joining
IGATE, Mr. Vemuri spent 14 years at Infosys Limited, a multinational
consulting and technology services company, in a variety of leadership
and business development roles and served on the board of Infosys from
2011 to 2013. Prior to joining Infosys in 1999, Mr. Vemuri worked in the
investment banking industry at Deutsche Bank and Bank of America. In
the past five years, he served as a director of Conduent Incorporated.

Mr. Vemuri brings to the Board a proven track record of leading
technology services companies through growth and corporate
transformations. His experience as CEO of global technology companies
as well as his experience with cyber security and risk oversight are of
value to the Board as he brings a unique operational, financial, and client
experience perspective. Additionally, Mr. Vemuri served on our Public
Responsibilities Committee which gives him additional perspectives on
risk oversight that he brings to the Audit Committee. Mr. Vemuri has been
designated an Audit Committee financial expert.

Age
54

Director Since
2019

Committees:
Audit
Finance

Qualifications:
Business Management
Financial Expertise
Risk Management
Operations & Technology
ESG

YOUR VOTE IS EXTREMELY IMPORTANT. The Board of Directors unanimously recommends a
vote “FOR ALL” of Kroger’s director nominees.

In addition to the information above, Appendix B sets forth information relating to our directors,
nominees for directors, and certain of our officers and associates who may be considered “participants”
in our solicitation under the applicable Securities and Exchange Commission’s rules by reason of their
position as directors of Kroger or as nominees for directors or because they may be soliciting proxies on
our behalf.

Board Succession Planning and Refreshment Mechanisms

Board succession planning is an ongoing, year-round process. The Corporate Governance
Committee recognizes the importance of thoughtful Board refreshment and engages in a continuing
process of identifying attributes sought for future Board members. The Corporate Governance Committee
takes into account the Board and Committee evaluations regarding the specific qualities, skills, and
experiences that would contribute to overall Board and Committee effectiveness, as well as the future
needs of the Board and its Committees in light of Kroger’s current and long-term business strategies, and
the skills and qualifications of directors who are expected to retire in the future including as a result of
our Board retirement policy, which requires directors to retire at the annual meeting following their 72nd
birthday.

Outside Board Service

No director who is an officer of the Company may serve as a director of another company without
the approval of the Corporate Governance Committee. Directors who are not officers of the Company
may not serve as a director of another company if in so doing such service would interfere with the
director’s ability to properly perform his or her responsibilities on behalf of the Company and its
shareholders, as determined by the Corporate Governance Committee. None of our current directors
serve on more than four public company Boards, including Kroger’s Board.

Board Diversity

Our director nominees reflect a wide array of experience, skills, and backgrounds. Each director is
individually qualified to make unique and substantial contributions to Kroger. Collectively, our directors’
diverse viewpoints and independent-mindedness enhance the quality and effectiveness of Board
deliberations and decision-making. Our Board is a dynamic group of new and experienced members,
which reflects an appropriate balance of institutional knowledge and fresh perspectives about Kroger due
to the varied length of tenure on the Board. We believe this blend of qualifications, attributes, and
tenure enables highly effective Board leadership.

The Corporate Governance Committee considers racial, ethnic, and gender diversity to be
important elements in promoting full, open, and balanced deliberations of issues presented to the
Board. When evaluating potential nominees to our Board, the Corporate Governance Committee
considers director candidates who help the Board reflect the diversity of our shareholders, associates,
customers, and the communities in which we operate, including by considering their geographic locations
to align directors’ physical locations with Kroger’s operating areas where possible. In connection with
the use of a third-party search firm to identify candidates for Board positions, the Corporate Governance
Committee instructs the third-party search firm to include in its initial list qualified female and racially/
ethnically diverse candidates. Four of our 11 director nominees self-identify as racially/ethnically diverse:
Mr. Brown and Ms. Gates self-identify as Black/African American and Ms. Chao and Mr. Vemuri self-
identify as Asian.

The Corporate Governance Committee believes that it has been successful in its efforts to
promote gender and ethnic diversity on our Board. Further, the Board aims to foster a diverse and
inclusive culture throughout the Company and believes that the Board nominees are well suited to do
so. The Corporate Governance Committee and Board believe that our director nominees for election at
our 2022 Annual Meeting bring to our Board a variety of different experiences, skills, and qualifications
that contribute to a well-functioning diverse Board that effectively oversees the Company’s strategy and

management. The charts below show the diversity of our director nominees and the skills and experience
that we consider important for our directors in light of our current business, strategy, and structure:

Nora
Aufreiter

Kevin
Brown

Elaine
Chao

Anne
Gates

Karen
Hoguet

Rodney
McMullen

Clyde
Moore

Ronald
Sargent

Amanda
Sourry

Mark
Sutton

Ashok
Vemuri

Total
(of 11)

Business

Management

Retail

Consumer

Financial

Expertise

Risk

Management

Operations &
Technology

ESG

Manufacturing

•

Gender Diversity

Ethnic Diversity

45%
Women

36% of
Board is
ethnically
diverse

Tenure of Director Nominees

7 directors
<5 years

1 director
5-10 years

3 directors
10+ years

Average Tenure is 8.1 years

Information Concerning the Board of Directors

Board Leadership Structure and Independent Lead Director

Kroger has a governance structure in which independent directors exercise meaningful and
rigorous oversight. The Board’s leadership structure, in particular, is designed with those principles in
mind and to allow the Board to evaluate its needs and determine, from time to time, who should lead the
Board. Our Corporate Governance Guidelines (the “Guidelines”) provide the flexibility for the Board to
modify our leadership structure in the future as appropriate. We believe that Kroger, like many U.S.
companies, is well-served by this flexible leadership structure.

In order to promote thoughtful oversight, independence and overall effectiveness, the Board’s

leadership includes Mr. McMullen, our Chairman and CEO, and an independent Lead Director
designated by the Board among the independent directors. The Lead Director works with the Chairman
to share governance responsibilities, facilitate the development of Kroger’s strategy, and grow
shareholder value. The Lead Director serves a variety of roles, consistent with current best practices,
including:

• reviewing and approving Board meeting agendas, materials, and schedules to confirm that the

appropriate topics are reviewed, with sufficient information provided to directors on each topic and
appropriate time is allocated to each;

• serving as the principal liaison between the Chairman, management, and the independent

directors;

• presiding at the executive sessions of independent directors and at all other meetings of the

Board at which the Chairman is not present;

• calling meetings of independent directors at any time; and

• serving as the Board’s representative for any consultation and direct communication, following a

request, with major shareholders.

The independent Lead Director carries out these responsibilities in numerous ways, including by:

• facilitating communication and collegiality among the Board members;

• soliciting direct feedback from independent directors;

• overseeing the succession planning process, including meeting with a wide range of associates

including corporate and division management associates;

• meeting with the CEO frequently to discuss strategy;

• serving as a sounding Board and advisor to the CEO;

• leading annual CEO evaluation process; and

• discussing Company matters with other directors between meetings.

Unless otherwise determined by the independent members of the Board, the Chair of the Corporate
Governance Committee is designated as the Lead Director. Ronald L. Sargent, an independent director
and the Chair of the Corporate Governance Committee, was appointed as our Board’s independent
Lead Director in June 2018. Mr. Sargent is an effective Lead Director for Kroger due to, among other
things, his:

• independence;

• deep strategic and operational understanding of Kroger obtained while serving as a Kroger

director;

• insight into corporate governance;

• experience as the CEO of an international ecommerce and brick and mortar retailer;

• experience on the Boards of other large publicly traded companies; and

• engagement and commitment to carrying out the role and responsibilities of the Lead Director.

With respect to the roles of Chairman and CEO, the Guidelines provide that the Board will determine
whether it is in the best interests of Kroger and its shareholders for the roles to be combined. The Board
exercises this judgment as it deems appropriate in light of prevailing circumstances. The Board
believes that this leadership structure improves the Board’s ability to focus on key policy and operational
issues and helps the Company operate in the long-term interest of shareholders. Additionally, this
structure provides an effective balance between strong Company leadership and appropriate safeguards
and oversight by independent directors. Our CEO’s strong background in finance, operations, and
strategic partnerships is particularly important to the Board given Kroger’s current growth strategy. Our
CEO’s consistent leadership, deep industry expertise, and extensive knowledge of the Company are
also especially critical in the midst of the rapidly evolving retail and digital landscape. The Board believes
that the structure of the Chairman and independent Lead Director position should continue to be
considered as part of the succession planning process.

Annual Board Evaluation Process

The Board and each of its Committees conduct an annual evaluation to determine whether the
Board is functioning effectively both at the Board and at the Committee levels. As part of this annual
evaluation, the Board assesses whether the current leadership structure and function continues to be
appropriate for Kroger and its shareholders, including in consideration of director succession planning.

Every year, the Board’s goal is to increase the effectiveness of the Board and the results of these

evaluations are used for this purpose. The Board recognizes that a robust evaluation process is an
essential component of strong corporate governance practices and ensuring Board effectiveness. The
Corporate Governance Committee oversees an annual evaluation process led by either the Lead
Independent Director or an independent third party.

Each director completes a detailed annual evaluation of the Board and the Committees on which
he or she serves and the Lead Director or an independent third party conducts interviews with each of
the directors. This year, the annual evaluation was conducted by an independent third party who held
interviews with every director.

Topics covered include, among others:

• The effectiveness of the Board and Board Committees and the active participation of all

directors

• The Board and Committees’ skills and experience and whether additional skills or experience

are needed

• The effectiveness of Board and Committee meetings, including the frequency of the meetings

• Board interaction with management, including the level of access to management, and the

responsiveness of management

• The effectiveness of the Board’s evaluation of management performance

• Additional subject matters the Board would like to see presented at their meetings or Committee

meetings

• Board’s governance procedures

• The culture of the Board to promote participation in a meaningful and constructive way

The results of this Board evaluation are discussed by the full Board and each Committee, as
applicable, and changes to the Board’s and its Committees’ practices are implemented as appropriate.

Over the past several years, this evaluation process has contributed to various enhancements in

the way the Board and the Committees operate, including increased focus on continuous Board
refreshment and diversity of its members as well as ensuring that Board and Committee agendas are
appropriately focused on strategic priorities and provide adequate time for director discussion and input

Director Onboarding and Engagement

All directors are expected to invest the time and energy required to gain an in-depth understanding
of our business and operations in order to enhance his or her strategic value to our Board. We develop
tailored onboarding plans for each new director. We arrange meetings for each new director with
appropriate officers and associates in order to familiarize him or her with the Company’s strategic plans,
financial statements, and key policies and practices. We also provide training on fiduciary obligations
of board members and corporate governance topics, as well as committee-specific onboarding. From
time to time, the Company will provide Board members with presentations from experts within and outside
of the Company on topics relevant to the Board’s responsibilities. Any member of the Board may
attend accredited third-party training and the expenses will be paid by the Company. Board meetings
are periodically held at a location away from our home office in a geography in which we operate. In
connection with these Board meetings, our directors learn more about the local business environment
through meetings with our regional business leaders and visits to our stores, competitors’ stores,
manufacturing facilities, distribution facilities, and/or customer fulfillment centers.

Committees of the Board of Directors

To assist the Board in undertaking its responsibilities, and to allow deeper engagement in certain

areas of company oversight, the Board has established five standing Committees: Audit, Compensation
and Talent Development (“Compensation”), Corporate Governance, Finance, and Public Responsibilities.
All Committees are composed exclusively of independent directors, as determined under the NYSE
listing standards. Each Committee has the responsibilities set forth in its respective charter, each of
which has been approved by the Board. The current charter of each Board Committee is available on our
website at ir.kroger.com under Investors — Governance — Corporate Governance Guidelines.

The current membership, 2021 meetings, and responsibilities of each Committee are summarized

below.

Name of Committee, Number of
Meetings, and Current Members

Audit Committee

Meetings in 2021: 5

Members:

Anne Gates, Chair
Kevin M. Brown
Karen M. Hoguet
Ronald L. Sargent
Ashok Vemuri

Primary Committee Responsibilities

• Oversees the Company’s financial reporting and

accounting matters, including review of the Company’s
financial statements and the audit thereof, the
Company’s financial reporting and accounting process,
and the Company’s systems of internal control over
financial reporting

• Selects, evaluates, and oversees the compensation

and work of the independent registered public
accounting firm and reviews its performance,
qualifications, and independence

• Oversees and evaluates the Company’s internal audit
function, including review of its audit plan, policies and
procedures, and significant findings

• Oversees enterprise risk assessment and risk

management, including review of cybersecurity risks
and regular reports received from management and
independent third parties

• Review of significant legal and regulatory matters
• Reviews and monitors the Company’s operational and
third-party compliance programs and updates thereto
• Reviews Ethics Hotline reports and discusses material

matters

• Reviews and approves related party transactions
• Conducts executive sessions with independent

registered public accounting firm and Vice President,

Name of Committee, Number of
Meetings, and Current Members

Primary Committee Responsibilities

Internal Audit at each meeting

• Conducts executive sessions with the Group Vice
President, Secretary and General Counsel, Vice
President and Chief Ethics & Compliance Officer, and
Senior Vice President and Chief Financial Officer
individually at least once per year

Compensation Committee

• Recommends for approval by the independent directors

Meetings in 2021: 5

Members:

Clyde R. Moore, Chair
Amanda Sourry
Mark S. Sutton

the compensation of the CEO and approves the
compensation of senior officers

• Administers the Company’s executive compensation

policies and programs, including determining grants of
equity awards under the plans

• Reviews annual incentive plans and long-term incentive

plan metrics and plan design

• Reviews emerging legislation and governance issues

and retail compensation trends

• Reviews the Company’s executive compensation peer

group

• Reviews CEO pay analysis
• Reviews Human Capital Management, including

Diversity, Equity and Inclusion

• Has sole authority to retain and direct the Committee’s

compensation consultant

• Assists the full Board with senior management

succession planning

• Conducts executive sessions with Senior Vice

President and Chief People Officer and independent
compensation consultant

Name of Committee, Number of
Meetings, and Current Members

Committee Functions

Corporate Governance Committee

• Oversees the Company’s corporate governance

Meetings in 2021: 2

Members:

Ronald L. Sargent, Chair
Elaine L. Chao
Anne Gates
Clyde R. Moore

policies and procedures

• Develops criteria for selecting and retaining directors,
including identifying and recommending qualified
candidates to be director nominees

• Designates membership and Chairs of Board

Committees

• Oversees and administers Board evaluation process
• Reviews the Board’s performance
• Establishes and reviews the practices and procedures

by which the Board performs its functions

• Reviews director independence, financial literacy, and

designation of financial expertise

• Administers director nomination process
• Interviews and nominates candidates for director

election

• Reviews compliance with share ownership guidelines
• Reviews and participates in shareholder engagement
• Reviews and establishes independent director

compensation

Name of Committee, Number of
Meetings, and Current Members

Finance Committee

Meetings in 2021: 4

Members:

Karen M. Hoguet, Chair
Nora A. Aufreiter
Amanda Sourry
Mark Sutton
Ashok Vemuri

Committee Functions

• Oversees the annual CEO evaluation process

conducted by the full Board

• Oversees the Company’s financial affairs and

management of the Company’s financial resources
• Reviews the Company’s annual and long-term financial

plans, capital spending plans, capital allocation
strategy, and use of cash

• Reviews the Company’s dividend policy and share

buybacks

• Reviews strategic transactions, and capital structure,

including potential issuance of debt or equity securities,
credit agreements, and other financing transactions
• Monitors the investment management of assets held in
pension and profit-sharing plans administered by the
Company

• Oversees the Company’s policies and procedures on

hedging, swaps, risk management and other derivative
transactions

• Oversees the Company’s engagement and

relationships with, and standing in, the financial
community

Public Responsibilities Committee

• Reviews the practices of the Company affecting its

Meetings in 2021: 3

Members:

Nora A. Aufreiter, Chair
Kevin M. Brown
Elaine L. Chao
Ronald L. Sargent

responsibility as a corporate citizen

• Examines and reviews the Company’s practices related

to environmental sustainability, and social impact,
including but not limited to
✓ climate impacts
✓ packaging
✓ food and operational waste
✓ food access,
✓ responsible sourcing,
✓ supplier diversity,
✓ people safety, food safety, and pharmacy safety
• Examines and reviews the Company’s ESG strategy
• Reviews the Company’s community engagement and

philanthropy

• Reviews the Company’s advocacy and public policy
• Reviews the Company’s communications and

Corporate Brand stewardship

• Assesses the Company’s effort in evaluating and

responding to changing public expectations and public
issues that affect the business

Shareholder Engagement

Maintaining ongoing relationships with our shareholders, and understanding our shareholders’

views, is a priority for both our Board and management team. We have a longstanding history of
engaging with our shareholders and through our investor relations program and our year-round
governance outreach program, including participation for our independent directors. In 2021, we
requested off-season engagement meetings with 27 shareholders representing 42% of our outstanding
shares and subsequently met with 17 shareholders representing 34% of our outstanding shares.
Some investors we contacted either did not respond or confirmed that a discussion was not needed at
that time.

ENGAGEMENT

COMMUNICATION

FEEDBACK

Executive management, Investor
Relations, Corporate Affairs, and the
General Counsel engage on a regular
basis with shareholders to solicit
feedback on a variety of corporate
governance matters, including, but not
limited to, executive compensation,
corporate governance policies and ESG
practices. We proactively manage
relationships to foster open dialogue with,
and capture feedback from, more than 70
organizations on over 40 ESG topics.

Kroger has a robust investor relations
program, routinely interacting and
communicating with shareholders
through a number of other forums,
including quarterly earnings
presentations, SEC filings, and the
Annual Report and Proxy Statement, the
annual shareholder meeting, investor
meetings and conferences and web
communications. We also publish our
Sustainability Report sharing our ESG
strategy, and progress and
achievements.

We share our shareholder feedback and
trends and developments about
corporate governance matters with our
Board and its Committees as we seek to
enhance our governance and ESG
practices and improve our disclosures.

We conduct shareholder outreach throughout the year to engage with shareholders on issues that

are important to them and us. During these engagements we discussed and solicited feedback on a
range of topics, which informed Board discussions and decisions, including but not limited to:

Business Strategy

• Kroger’s growth strategy and track record of innovation

• Our strong value creation model and recent performance

ESG Practices & Disclosures

• Discussions with socially conscious investors and NGOs helped inform our new ESG strategy

and long-term commitments

• Thriving Together, Kroger’s ESG strategy, including long-term environmental sustainability, social
impact, and responsible sourcing commitments, progress updates, and steps being taken to
achieve our ambitious goals

• Board oversight of ESG strategy and updated Committee responsibilities

• Kroger’s ESG reporting and disclosures, including our alignment with the TCFD, SASB, and GRI

reporting frameworks

• The centerpiece of our ESG strategy is Zero Hunger | Zero Waste, an industry-leading platform

for collective action and systems change to end hunger in our communities and eliminate
waste across our company

Human Capital Management

• Our DE&I Framework for Action and steps we are taking to ensure our workforce reflects the

communities we serve and are a member of

• Our focus on our associates’ well-being, including increasing our increased average hourly

associate wage, comprehensive benefits, and opportunities for internal progression and leadership
development training

• Workforce diversity reporting, including EEO-1 demographic disclosure

• Robust Board oversight of human rights in our supply chain

Compensation Structure

• Overview of compensation program design and alignment of pay and performance

• Consideration of short and long-term metrics, including financial and non-financial metrics, such

as ESG metrics

• The balance of equity and cash compensation, as well as fixed versus at risk compensation

Board and Board Oversight

• Our Board’s approach to board refreshment considering diversity, balance of tenure, and

alignment of board skills and experience with Kroger’s current and long-term business strategies

• Board and committee responsibilities for oversight of ESG priorities, and approach to risk

management

Discussions with socially conscious investors and NGOs helped inform our new ESG strategy and

long-term commitments. Overall shareholders expressed appreciation for the opportunity to have an
ongoing discussion and were complementary of Kroger’s ESG practices. Specifically, shareholders
recognized the actions Kroger took to formalize our ESG strategy, Thriving Together, and how our Board
oversees this strategy, including our ESG targets and initiatives. These conversations provided valuable
insights into our shareholders’ evolving perspectives, which were shared with our full Board.

Board’s Response to Shareholder Proposals

Accountability to our shareholders continues to be an important component of our success. We

actively engage with our shareholder proponents. Every year, following our Annual Shareholders’
Meeting, our Corporate Governance Committee considers the voting outcomes for shareholder
proposals. In addition, our Corporate Governance Committee and other Committees, as appropriate,
consider proposed courses of action in light of the voting outcomes for shareholder proposals under their
oversight, as well as feedback provided directly from our shareholders.

Director Nominee Selection Process

The Corporate Governance Committee is responsible for recommending to the Board a slate of
nominees for election at each annual meeting of shareholders. The Corporate Governance Committee
recruits candidates for Board membership through its own efforts and through recommendations
from other directors and shareholders. In addition, the Corporate Governance Committee retains an
independent, third-party search firm to assist in identifying and recruiting director candidates who meet
the criteria established by the Corporate Governance Committee.

These criteria are:

• demonstrated ability in fields considered to be of value to the Board, including business

management, retail, consumer, operations, technology, financial, sustainability, manufacturing,
public service, education, science, law and government;

• experience in high growth companies and nominees whose business experience can help the

Company innovate and derive new value from existing assets;

• highest standards of personal character and conduct;

• willingness to fulfil the obligations of directors and to make the contribution of which he or she is

capable, including regular attendance and participation at Board and Committee meetings,
and preparation for all meetings, including review of all meeting materials provided in advance
of the meeting; and

• ability to understand the perspectives of Kroger’s customers, taking into consideration the

diversity of our customers, including regional and geographic differences.

Additionally, in connection with the use of an independent, third-party search firm to identify
director candidates, the Corporate Governance Committee will instruct the firm to include in its initial
list qualified female and racially/ethnically diverse candidates.

The Corporate Governance Committee also considers diversity, as discussed in detail under
“Board Diversity” above, and the specific experience and abilities of director candidates in light of our
current business, strategy and structure, and the current or expected needs of the Board in its
identification and recruitment of director candidates.

The criteria for Board membership applied by the Corporate Governance Committee in its evaluation

of potential Board members does not vary based on whether a candidate is recommended by our
directors, a third-party search firm, or shareholders.

Identifying Director
Candidates

Review of Candidate
Pool

In-Depth Candidate
Review

Recommend Director
Nominee Slate

Potential candidates for
director may be identified
by our directors, third-party
search firm or
shareholders.

The Governance
Committee reviews
candidates to determine
whether candidates warrant
further consideration.

Candidates will meet with
Governance Committee
members and be evaluated
for independence and
potential conflicts, skills and
experience and diversity.

The Governance
Committee recommends
candidates for appointment
or election to the Board.

Candidates Nominated by Shareholders

The Corporate Governance Committee will consider shareholder recommendations for director

nominees for election to the Board. If shareholders wish to nominate a person or persons for election
to the Board at our 2023 annual meeting, written notice must be submitted to Kroger’s Secretary, and
received at our executive offices, in accordance with Kroger’s Regulations, not later than March 18,
2023. Such notice should include the name, age, business address and residence address of such
person, the principal occupation or employment of such person, the number of Kroger common shares
owned of record or beneficially by such person and any other information relating to the person that
would be required to be included in a proxy statement relating to the election of directors. The Secretary
will forward the information to the Corporate Governance Committee for its consideration. The
Corporate Governance Committee will use the same criteria in evaluating candidates submitted by
shareholders as it uses in evaluating candidates identified by the Corporate Governance Committee,
as described above. See “Director Nominee Selection Process.”

Additionally, to comply with the universal proxy rules (once effective), shareholders who intend to

solicit proxies in support of director nominees other than our nominees must provide notice to Kroger’s
Secretary that sets forth the information required by Rule 14a-19 of the Exchange Act no later
than April 24, 2023.

Eligible shareholders have the ability to submit director nominees for inclusion in our proxy

statement for the 2023 annual meeting of shareholders. To be eligible, shareholders must have owned
at least 3% of our common shares for at least three years. Up to 20 shareholders are able to aggregate
for this purpose. Nominations must be submitted to our Corporate Secretary at our principal executive
offices no earlier than December 3, 2022 and no later than January 2, 2023.

Corporate Governance Guidelines

The Board has adopted the Guidelines, which provide a framework for the Board’s governance

and oversight of the Company. The Guidelines are available on our website at ir.kroger.com under
Investors — Governance — Corporate Governance Guidelines. Shareholders may also obtain a copy
of the Guidelines, at no cost, by making a written request to Kroger’s Secretary at our executive offices.
Certain key principles addressed in the Guidelines are summarized below.

Independence

The Board has determined that all of the current independent directors and nominees have no
material relationships with Kroger and satisfy the criteria for independence set forth in Rule 303A.02 of

the NYSE Listed Company Manual. Therefore, all independent directors and nominees are independent
for purposes of the NYSE listing standards. The Board made its determination based on information
furnished to the Company by each of the directors regarding their relationships with Kroger and its
management, and other relevant information. The Board considered, among other things, that

• the value of any business transactions between Kroger and entities with which the directors are

affiliated falls below the thresholds identified by the NYSE listing standards, and

• no directors had any material relationships with Kroger other than serving on our Board.

Audit Committee Independence and Expertise

The Board has determined that Anne Gates, Karen M. Hoguet, Ronald L. Sargent, and Ashok
Vemuri, independent directors, each of whom is a member of the Audit Committee, are “audit Committee
financial experts” as defined by applicable Securities and Exchange Commission (“SEC”) regulations
and that all members of the Audit Committee are “financially literate” as that term is used in the NYSE
listing standards and are independent in accordance with Rule 10A-3 of the Securities Exchange Act of
1934.

Code of Ethics

The Board has adopted The Kroger Co. Policy on Business Ethics, applicable to all officers,
associates and directors, including Kroger’s principal executive, financial and accounting officers. The
Policy on Business Ethics is available on our website at ir.kroger.com under Investors — Governance —
Policy on Business Ethics. Shareholders may also obtain a copy of the Policy on Business Ethics by
making a written request to Kroger’s Secretary at our executive offices.

Communications with the Board

The Board has established two separate mechanisms for shareholders and interested parties to

communicate with the Board. Any shareholder or interested party who has concerns regarding
accounting, improper use of Kroger assets, or ethical improprieties may report these concerns via the toll-
free hotline (800-689-4609) or website (ethicspoint.com) established by the Board’s Audit Committee.
The concerns are investigated by Kroger’s Vice President, Chief Ethics and Compliance Officer and the
Vice President of Internal Audit and reported to the Audit Committee as deemed appropriate.

Shareholders or interested parties also may communicate with the Board in writing directed to
Kroger’s Secretary at our executive offices. Communications relating to personnel issues, ordinary
business operations, or companies seeking to do business with us, will be forwarded to the business
unit of Kroger that the Secretary deems appropriate. Other communications will be forwarded to the
Chair of the Corporate Governance Committee for further consideration. The Chair of the Corporate
Governance Committee will take such action as he or she deems appropriate, which may include
referral to the full Corporate Governance Committee or the entire Board.

Executive Officer Succession Planning

The Guidelines provide that the Compensation Committee will review Company policies and

programs for talent development and evaluation of executive officers, and will review management
succession planning. In connection with the use of a third-party search firm to identify external candidates
for executive officer positions, including the chief executive officer, the Board and/or the Company, as
the case may be, will instruct the third-party search firm to include in its initial list qualified female and
racially/ethnically diverse candidates.

Attendance

The Board held 7 meetings in fiscal year 2021. During fiscal 2021, all incumbent directors attended
at least 75% of the aggregate number of meetings of the Board and Committees on which that director
served. Members of the Board are expected to use their best efforts to attend all annual meetings of
shareholders. All Board members attended last year’s virtual annual meeting.

Independent Compensation Consultants

The Compensation Committee directly engages a compensation consultant to advise the

Compensation Committee in the design of Kroger’s executive compensation. The Committee retained
Korn Ferry Hay (US) (“Korn Ferry”) beginning in December 2017. Retained by and reporting directly to
the Compensation Committee, Korn Ferry provided the Committee with assistance in evaluating
Kroger’s executive compensation programs and policies.

In fiscal 2021, Kroger paid Korn Ferry $387,392 for work performed for the Compensation

Committee. Kroger, on management’s recommendation, retained Korn Ferry to provide other services
for Kroger in fiscal 2021 for which Kroger paid $31,677. These other services primarily related to salary
surveys and benchmarking. The Compensation Committee expressly approved Korn Ferry performing
these additional services. After taking into consideration the NYSE’s independence standards and the
SEC rules, the Compensation Committee determined that Korn Ferry was independent, and their
work has not raised any conflict of interest.

The Compensation Committee may engage an additional compensation consultant from time to

time as it deems advisable.

Compensation Committee Interlocks and Insider Participation

No member of the Compensation Committee was an officer or associate of Kroger during fiscal

2021, and no member of the Compensation Committee is a former officer of Kroger or was a party to
any related person transaction involving Kroger required to be disclosed under Item 404 of
Regulation S-K. During fiscal 2021, none of our executive officers served on the Board of directors or
on the compensation Committee of any other entity that has or had executive officers serving as a
member of Kroger’s Board of Directors or Compensation Committee of the Board.

The Board’s Role in Risk Oversight

While risk management is primarily the responsibility of Kroger’s management team, the Board is

responsible for strategic planning and overall supervision of our risk management activities. The Board’s
oversight of the material risks faced by Kroger occurs at both the full Board level and at the Committee
level.

We believe that our approach to risk oversight optimizes our ability to assess inter-relationships

among the various risks, make informed cost-benefit decisions, and approach emerging risks in a
proactive manner for Kroger. We also believe that our risk oversight structure complements our current
Board leadership structure, as it allows our independent directors, through the five fully independent
Board Committees, and in executive sessions of independent directors led by the Lead Director, to
exercise effective oversight of the actions of management’s identification of risk and implementation of
effective risk management policies and controls.

The Board receives presentations throughout the year from various department and business unit
leaders that include discussion of significant risks, including newly identified and evolving high priority
risks, such as those presented by the COVID-19 pandemic. When new risks are identified, such as those
presented by the COVID-19 pandemic, management conducts, and either the full Board or the
appropriate Board committee reviews and discusses, an enterprise risk assessment related to such
new risks which may include human capital, supply chain, associate and customer health and safety,
legal, regulatory, and other risks. Management and the Board then discuss the relative severity of each
category of risk as well as mitigating actions.

At each Board meeting, the CEO addresses matters of particular importance or concern, including

any significant areas of risk, such as newly identified risks, that require Board attention. Additionally,
through dedicated sessions focusing entirely on corporate strategy, the full Board reviews in detail
Kroger’s short- and long-term strategies, including consideration of significant risks facing Kroger and
their potential impact. The independent directors, in executive sessions led by the Lead Director, address
matters of particular concern, including significant areas of risk, that warrant further discussion or
consideration outside the presence of Kroger employees. At the committee level, reports are given by

management subject matter experts to each Committee on risks within the scope of their charters.
Each Committee reports to the full Board at each meeting, including any areas of risk discussed by the
Committee.

The Audit Committee has oversight responsibility not only for financial reporting of Kroger’s major
financial exposures and the steps management has taken to monitor and control those exposures, but
also for the effectiveness of management’s processes that monitor and manage key business risks
facing Kroger, as well as the major areas of risk exposure, and management’s efforts to monitor and
control the major areas of risk exposure. The Audit Committee incorporates its risk oversight function into
its regular reports to the Board and also discusses with management its policies with respect to risk
assessment and risk management.

Our Vice President, Chief Ethics and Compliance Officer provides regular updates to the Audit

Committee on our compliance risks and actions taken to mitigate that risk. In addition, the Audit
Committee is charged with oversight of data privacy and cybersecurity risks. Protection of our customers’
data is a fundamental priority for our Board and management team. Our Chief Information Officer and
our Chief Information Security Officer provide updates at each quarterly Committee meeting on our
cybersecurity risks and actions taken to mitigate that risk to the Audit Committee and meet with the
full Board at least annually. The Chief Information Security Officer reports on compliance and regulatory
issues, continuously evolving threats and mitigating actions, and presents a NIST Cybersecurity
Framework Scorecard to the Audit Committee. In overseeing cybersecurity risks, the Audit Committee
focuses on thematic issues within an aggregated strategic lens and uses a risk based approach. Oversight
of cybersecurity risk incorporates strategy metrics, third party assessments and internal audit and
controls. Finally, an independent third party also regularly reports to the Audit Committee/Board on
cybersecurity and outside counsel advises the Board about best practices for cybersecurity oversight
by the Board, and the evolution of that oversight over time. Management also reports on strategic key risk
indicators, ongoing initiatives, and significant incidents and their impact.

Environmental, Sustainability, and Governance Oversight

We are aligned with the desire of our customers, associates, and shareholders to engage in our

communities and reduce our impacts on the environment while continuing to create positive economic
value over the long-term. Given the breadth of topics and their importance to us, four of our Board
Committees have direct oversight of environmental, social, and governance topics. ESG topics our
Board Committees oversee are as follows:

Audit

Compensation & Talent Development

Corporate Governance

• Legal & Regulatory
• Ethics
• Operational and Third Party Compliance
• Data Privacy & Cyber Security
• Financial Integrity

• Human Capital Management
• Talent Development
• Executive Compensation
• Diversity, Equity & Inclusion

• Board recruitment/diversity
• Board succession
• Shareholder engagement program
• Shareholder advisory votes & shareholder proposals
• Independent director compensation

Public Responsibilities

• Environmental Sustainability

• Climate Impacts
• Packaging
• Food Waste (Zero Waste)

• Social Impact

• Food Access (Zero Hunger)
• Community Engagement
• Philanthropy
• Responsible Sourcing

• Human Rights
• Animal Welfare

• Safety
• Food
• People
• Pharmacy

• Advocacy & Public Policy
• Government Relations
• Political action (KroPAC)

• Communications & Brand Stewardship

• Associate & External Communications
• Stakeholder Relations

Our commitment to ESG matters is not new. Our Public Responsibilities Committee was established
in 1977. For the past fifteen years, our Company has prepared and produced an annual report describing
our progress and initiatives regarding sustainability and other ESG matters. For the most recent
information regarding our ESG initiatives and related matters, please visit http://sustainability.kroger.com.
The information on, or accessible through, this website is not part of, or incorporated by reference
into, this proxy statement.

In addition, our full Board oversees issues related to diversity and inclusion within the Kroger

workplace. Diversity and inclusion have been deeply rooted in Kroger’s values for decades. We are
committed to fostering an environment of inclusion in the workplace, marketplace, and workforce where
the diversity of cultures, backgrounds, experiences, perspectives and ideas are valued and appreciated.
Kroger’s corporate team and retail divisions have strategic partnerships with universities, educational
institutions, and community partners to improve how we attract candidates from all backgrounds and
ethnicities for jobs at all levels. Diversity and inclusion will continue to be a key ingredient in feeding
Kroger’s innovation, long-term sustainability, and the human spirit.

The Kroger family of companies provides inclusion training to all management and many hourly

associates. Most work locations (stores, plants, distribution centers, and offices) have an inclusion-
focused team, called Our Promise team. The teams work on projects that reflect Kroger’s values, offer
leaders valuable feedback and suggestions on improving diversity and inclusion, and facilitate
communication to champion business priorities.

Our Commitment to Diversity, Equity & Inclusion

Kroger’s Chief People Officer leads Human Resources & Labor Relations, which includes our
Diversity, Equity & Inclusion team. This function — with human resources professionals in place across
our lines of business and retail divisions — advocates for and fosters an associate experience that
reflects our Values. It also monitors and measures progress on current goals and identifies potential
opportunities for improvement.

Kroger publicly affirmed our commitment with our Framework for Action: Diversity, Equity &

Inclusion, a 10-point plan outlining short- and longer-term steps developed with associates and leaders
to promote greater change in the workplace and the communities we serve. This framework outlines
five focus areas: Create More Inclusive Culture, Develop Diverse Talent, Advance Diverse Partnerships,
Advance Equitable Communities, and Deeply Listen and Report Progress. More details about the

plan are available here: https://www.thekrogerco.com/community/standing-together/. The information
on, or accessible through, this website is not part of, or incorporated by reference into, this proxy
statement.

Enabling Connections

As part of the framework, we committed to provide inclusion training for our associates. To date,

more than 500,000 leaders and associates have completed diversity and inclusion training. To promote
ongoing open dialogue, we also created and shared several Allyship Guides, which aim to help
leaders and associates move from awareness of diversity, equity and inclusion to advocacy.

In 2020, Kroger formed an internal Diversity, Equity & Inclusion Advisory Council comprised of
leaders from across the organization. The new Council works closely with our executive leadership
team and other business leaders to identify opportunities and action steps for improvement. We also
created an Associate Influencer Group of hourly associates to facilitate representation and input from
all levels of the company.

Kroger also operates 12 internal Associate Resource Groups (ARGs), or affinity groups, some of

which also have local chapters. These groups enable stronger connections across our family of
companies, lift up shared experiences, promote personal and professional growth, and influence
business decisions. Kroger leaders sponsor and personally engage with the ARGs.

Workplace Equity

Kroger strives to attract, retain and develop diverse leaders and associates who reflect the

communities we serve. We offer accessible employment for a wide range of people across the country.
Because of our unique business model, we help unlock economic opportunity for 420,000 people of
all ages and aspirations, from those wanting an entry-level part-time job to graduate-degree specialists
across corporate functions.

Kroger strategically invests in our associates’ growth and movement across levels, lines of

business, and geographies. Our goal is to shift the demographic representation of women and people
of color at company-wide and local levels to reflect our changing country, communities, and
neighborhoods. The Diversity, Equity & Inclusion Advisory Council helps define aspirations for our
workforce of the future.

Community Engagement

As part of our Framework for Action, the Company also pledged to help advance equitable
communities. In 2020, Kroger committed an initial $5 million to establish The Kroger Co. Foundation’s
Racial Equity Fund. The Foundation directed the first $3 million in grants to four organizations driving
change at national and local levels: Black Girl Ventures, Everytable, the Local Initiatives Support
Corporation (LISC), and the Thurgood Marshall College Fund.

Earlier this year, the Foundation directed $1.1 million in grants to help build black wealth and
improve racial health equity in Ohio and Tennessee. Ohio partners — The Urban League of Greater
Southwestern Ohio, The National Underground Railroad Freedom Center, and FundNOIRE — received
grants totaling $600,000. In Tennessee, a $500,000 grant supports the Next Generation scholarship
program in partnership with Memphis-based LeMoyne-Owen College, part of the network of Historically
Black Colleges and Universities (HBCU), and the Women’s Foundation for a Greater Memphis.

Kroger recently pledged an additional $5 million to expand the Racial Equity Fund’s work and

positive impacts.

Director Compensation

2021 Director Compensation

The following table describes the fiscal year 2021 compensation for independent directors.

Mr. McMullen does not receive compensation for his Board service.

Name

Nora A. Aufreiter

Kevin M. Brown

Elaine L. Chao

Anne Gates

Karen M. Hoguet
Susan J. Kropf(4)
Clyde R. Moore
Ronald L. Sargent
Amanda Sourry

Mark S. Sutton
Ashok Vemuri

Fees
Earned or
Paid in
Cash

Stock
Awards(1)(2)

$110,499

$186,197

$105,507

$186,197

$ 49,464

$169,589

$130,445

$186,197

$120,467
$ 37,742

$115,486
$157,866
$ 95,539

$ 95,539
$102,149

$186,197
0
$

$186,197
$186,197
$186,197

$186,197
$186,197

Change in Pension
Value
And Nonqualified
Deferred Compensation
Earnings(3)

$
$

0
0

$ —
$4,837
0
$

$
$

0
0

Total

$296,696

$291,704

$219,053

$316,642

$306,664
$ 37,742

$301,683
$348,900
$281,736

$281,736
$288,346

(1) Amounts reported in the Stock Awards column represent the aggregate grant date fair value of

the annual incentive share award, computed in accordance with FASB ASC Topic 718. On July 14,
2021, each independent director then serving received 4,859 incentive shares with a grant date
fair value of $186,197, except Ms. Chao, who received a pro-rated grant of 4,062 incentive shares
on the day of her election to the Board, August 6, 2021, with a grant date fair value of $169,589.

(2) Options are no longer granted to independent directors. The aggregate number of previously

granted stock options that remained unexercised and outstanding at fiscal year-end was as follows:
Mr. Sargent held 13,000 options.

(3) The amount reported for Mr. Sargent represents preferential earnings on nonqualified deferred
compensation. For a complete explanation of preferential earnings, please refer to footnote 5 to
the Summary Compensation Table. Mr. Moore’s pension value decreased by $69,477 which
represents the change in actuarial present value of his accumulated benefit under the pension
plan for independent directors. This change in value of accumulated pension benefits is not included
in the Director Compensation Table because the value decreased. Pension values may fluctuate
significantly from year to year depending on a number of factors, including age, average annual
earnings, and the assumptions used to determine the present value, such as the discount rate. The
decrease in the actuarial present value of his accumulated pension benefit for 2021 is primarily
due to the increase in the discount rate as well as the change in value due to aging, partially offset
by the change in value of the benefit due to mortality project scale updates.

(4) Ms. Kropf retired from the Board on June 24, 2021.

Annual Compensation

Each independent director receives an annual cash retainer of $100,000. The Lead Director
receives an additional annual retainer of $37,500 per year; the members of the Audit Committee each
receive an additional annual retainer of $10,000; the Chair of the Audit Committee receives an additional
annual retainer of $25,000; the Chair of the Compensation Committee receives an additional annual
retainer of $20,000; and the Chair of each of the other Committees receives an additional annual retainer
of $15,000. Each independent director also receives an annual grant of incentive shares (Kroger
common shares) with a value of approximately $185,000.

The Board has determined that compensation of independent directors must be competitive on an

ongoing basis to attract and retain directors who meet the qualifications for service on the Board.
Independent director compensation was adjusted in 2021 and will be reviewed from time to time as the
Corporate Governance Committee deems appropriate.

Pension Plan

Independent directors first elected prior to July 17, 1997 receive an unfunded retirement benefit
equal to the average cash compensation for the five calendar years preceding retirement. Only Mr. Moore
is eligible for this benefit. Benefits begin at the later of actual retirement or age 65.

Nonqualified Deferred Compensation

We also maintain a deferred compensation plan for independent directors. Participants may defer

up to 100% of their cash compensation and/or the receipt of all (and not less than all) of the annual
award of incentive shares.

Cash Deferrals

Cash deferrals are credited to a participant’s deferred compensation account. Participants may

elect from either or both of the following two alternative methods of determining benefits:

• interest accrues until paid out at the rate of interest determined prior to the beginning of the

deferral year to represent Kroger’s cost of ten-year debt; and/or

• amounts are credited in “phantom” stock accounts and the amounts in those accounts fluctuate

with the price of Kroger common shares.

In both cases, deferred amounts are paid out only in cash, based on deferral options selected by
the participant at the time the deferral elections are made. Participants can elect to have distributions
made in a lump sum or in quarterly installments, and may make comparable elections for designated
beneficiaries who receive benefits in the event that deferred compensation is not completely paid out
upon the death of the participant.

Incentive Share Deferrals

Participants may also defer the receipt of all (and not less than all) of the annual award of

incentive shares. Distributions will be made by delivery of Kroger common shares within 30 days after
the date which is six months after the participant’s separation of service.

Director Stock Ownership Guidelines

Independent directors are required to own shares equivalent to five times their annual base cash

retainer. For more details on the Stock Ownership Guidelines, see page 69.

Beneficial Ownership of Common Stock

The following table sets forth the common shares beneficially owned as of April 25, 2022 by
Kroger’s directors, the NEOs, and the directors and executive officers as a group. The percentage of
ownership is based on 720,938,109 of Kroger common shares outstanding on April 25, 2022. Shares
reported as beneficially owned include shares held indirectly through Kroger’s defined contribution plans
and other shares held indirectly, as well as shares subject to stock options exercisable on or before
June 24, 2022. Except as otherwise noted, each beneficial owner listed in the table has sole voting and
investment power with regard to the common shares beneficially owned by such owner.

Name
Stuart Aitken(2)
Nora A. Aufreiter(3)
Kevin M. Brown
Elaine L. Chao
Yael Cosset
Anne Gates(3)
Karen M. Hoguet(4)
Timothy A. Massa

W. Rodney McMullen
Gary Millerchip

Clyde R. Moore
Ronald L. Sargent(3)
Amanda Sourry
Mark S. Sutton(3)
Ashok Vemuri
Directors and executive officers as a group (22 persons,

Amount and Nature
of Beneficial
Ownership(1)
(a)

Options Exercisable
on or before
June 24,
2022 — included
in column (a)
(b)

331,920
44,450
7,117
4,062
302,626

39,005
15,665

430,581

5,852,633
428,714

117,536
175,851
7,117

34,423
21,013

166,695
—
—

162,149

—
—

266,625

2,494,750
255,402

—
—
—

—
—

including those named above)

8,882,633

3,870,473

(1) No director or officer owned as much as 1% of Kroger common shares. The directors and executive

officers as a group beneficially owned 1.23% of Kroger common shares.

(2) This amount includes 3,018 shares held by Mr. Aitken’s spouse. He disclaims beneficial ownership

of these shares.

(3) This amount includes incentive share awards that were deferred under the deferred compensation
plan for independent directors in the following amounts: Ms. Aufreiter, 9,831; Ms. Gates, 7,980;
Mr. Sargent, 50,940 and Mr. Sutton, 6,767.

(4) This amount includes 2,075 shares held by Ms. Hoguet’s spouse. She disclaims beneficial

ownership of these shares.

The following table sets forth information regarding the beneficial owners of more than five percent

of Kroger common shares as of April 25, 2022 based on reports on Schedule 13G filed with the SEC.

Name

Berkshire Hathaway Inc.

BlackRock, Inc.

State Street Corporation

Vanguard Group Inc.

Address

Amount and Nature
of Ownership

Percentage
of Class

3555 Farnam Street
Omaha, NE 68131
55 East 52nd Street
New York, NY 10055

One Lincoln Street
Boston, MA 02111

100 Vanguard Blvd.
Malvern, PA 19355

61,412,910(1)

8.4%

74,484,953(2)

10.1%

37,394,528(3)

5.09%

78,978,401(4)

10.74%

(1) Reflects beneficial ownership by Berkshire Hathaway Inc. as of December 31, 2021, as reported
on Schedule 13G filed with the SEC on February 14, 2022, reporting shared voting power with
respect to 61,412,910 common shares, and shared dispositive power with regard to 61,412,910
common shares.

(2) Reflects beneficial ownership by BlackRock Inc., as of February 28, 2022, as reported on

Amendment No. 14 to Schedule 13G filed with the SEC on March 9, 2022, reporting sole voting
power with respect to 64,194,514 common shares, and sole dispositive power with regard to
74,484,953 common shares.

(3) Reflects beneficial ownership by State Street Corporation as of December 31, 2021 as reported
on Schedule 13G filed with the SEC on February 11, 2022, reporting shared voting power with
respect to 30,585,152 common shares, and shared dispositive power with respect to 37,186,340
common shares.

(4) Reflects beneficial ownership by Vanguard Group Inc. as of December 31, 2021, as reported on

Amendment No. 7 to Schedule 13G filed with the SEC on January 10, 2022, reporting shared voting
power with respect to 1,111,168 common shares, sole dispositive power of 76,158,064 common
shares, and shared dispositive power of 2,820,337 common shares.

Related Person Transactions

The Board has adopted a written policy requiring that any Related Person Transaction may be
consummated or continue only if the Audit Committee approves or ratifies the transaction in accordance
with the policy. A “Related Person Transaction” is one (a) involving Kroger, (b) in which one of our
directors, nominees for director, executive officers, or greater than five percent shareholders, or their
immediate family members, have a direct or indirect material interest; and (c) the amount involved
exceeds $120,000 in a fiscal year.

The Audit Committee will approve only those Related Person Transactions that are in, or not

inconsistent with, the best interests of Kroger and its shareholders, as determined by the Audit
Committee in good faith in accordance with its business judgment. No director may participate in any
review, approval or ratification of any transaction if he or she, or an immediate family member, has a
direct or indirect material interest in the transaction.

Where a Related Person Transaction will be ongoing, the Audit Committee may establish guidelines

for management to follow in its ongoing dealings with the related person and the Audit Committee will
review and assess the relationship on an annual basis to ensure it complies with such guidelines and that
the Related Person Transaction remains appropriate.

Compensation Discussion and Analysis

This Compensation Discussion and Analysis provides an overview of the elements and philosophy
of our executive compensation program as well as how and why the Compensation Committee and our
Board of Directors make specific compensation decisions and policies with respect to our Named
Executive Officers (“NEOs”), as defined below.

Executive Summary

We delivered record performance results in 2021. By connecting with customers through
our expanded seamless digital ecosystem and consistent delivery of full, fresh and friendly
customer experience, we successfully navigated a dynamic operational environment, labor
and supply chain challenges and achieved record revenue and profitability as demonstrated
by our financial performance results of ID sales of 0.2%, two year stack increased 14.3%,
and adjusted FIFO operating profit of $4.3 Billion2.
Our executive compensation program aligns with long-term shareholder value
creation. 91% of the CEO’s target total direct compensation and, on average, 83% of the
other NEOs’ compensation is at risk and performance based, tied to achievement of
performance targets that are important to our shareholders or our long-term share price
performance.
Annual incentive program design reflected volatile market environment. Our 2021
annual incentive program consisted of two performance periods to maintain the program
rigor amid uncertain business outlook at the start of the year, with more challenging sales
performance goals implemented in the second half of the year.

See pages 33 – 34 of our Annual Report on Form 10-K for the fiscal year ended January 29,
2022, filed with the SEC on March 29, 2022, for a reconciliation of GAAP operating profit to adjusted
FIFO operating profit.

Our Named Executive Officers for Fiscal 2021

Name
W. Rodney McMullen
Gary Millerchip
Stuart W. Aitken
Yael Cosset
Timothy A. Massa

Title

Chairman and Chief Executive Officer
Senior Vice President and Chief Financial Officer
Senior Vice President and Chief Merchandising & Marketing Officer
Senior Vice President and Chief Information Officer
Senior Vice President and Chief People Officer

Fiscal 2021 Financial and Strategic Performance Highlights

Driven by our unwavering purpose to Feed the Human Spirit, throughout 2021, we leveraged
technology and innovation to continue to provide fresh, affordable food for our customers, invest in our
associates, create value for our shareholders and support our communities.

Our ID sales performance resulted in a two-year stacked growth rate of 14.3%. Accelerated efforts

to digitize the shopping experience demonstrated our ability to meet our customers’ needs no matter
how they choose to engage with us, resulting in digital sales two-year stacked growth of 113%. Our Home
Chef business surpassed $1 billion in sales in 2021, becoming the newest billion-dollar brand in our
portfolio. We also advanced our fresh strategy and strengthened our fresh offerings in 2021 by launching
our Go Fresh & Local Supplier Accelerator, supporting our commitment to small businesses.

Continued strategic efforts to streamline our operations allowed us to achieve cost savings greater
than $1 billion for the fourth consecutive year to balance these investments without compromising food
affordability for our customers across our communities.

As part of our Zero Hunger | Zero Waste social and environmental impact plan, in 2021, we
donated 499 million meals to feed families across America. We also administrated almost 11 million
doses of the COVID-19 vaccine through Kroger Health.

We are proud of our management team that led an agile effort in navigating supply chain conditions
and evolving operating and inflationary environment throughout 2021, building an agile ecosystem and
momentum to support our long-term growth. We have started 2022 with a great outlook and are
positioned to support sustained shareholder value creation, while staying true to our Promise to provide
fresh affordable food to our customers and uplift our communities.

2021 Advisory Vote to Approve Executive Compensation and Shareholder Engagement

At the 2021 annual meeting, we held our tenth annual advisory vote on executive compensation.

Approximately 90% of the votes cast were in favor of the advisory vote in 2021. As part of our ongoing
dialogue with our shareholders regarding governance matters, in 2021, we requested meetings with
27 shareholders representing 42% of our outstanding shares during proxy season and off-season
engagement and 17 shareholders representing 34% of our outstanding shares accepted our invitation
to share feedback. Some investors we contacted either did not respond or confirmed that a discussion
was not needed at that time.

Conversations with our shareholders in these meetings included discussions about our
compensation program, with our shareholders providing feedback that they appreciated the pay for
performance nature of our program’s structure. The Compensation Committee considers both the
general and specific feedback received from shareholders, and with the guidance of our independent
compensation consultant, incorporates that input. For example, prior to 2019, Kroger’s long term
performance-based compensation included both a cash and an equity component. As of 2019, in
response to feedback from shareholders and market practices, our Compensation Committee determined
that all long-term compensation is equity-based as follows: 50% of equity granted under the program
is performance-based and the remaining 50% of equity is time-based, consisting of 30% in the form of
restricted stock and 20% in the form of stock options.

During our fall 2021 off-season engagement program, we specifically discussed ESG metrics in

executive compensation programs with our shareholders. All of our investors were supportive of

companies’ decisions to incorporate ESG metrics, but none were prescriptive about how to do so. Our
investors shared our view that a range of ESG matters are essential to our current and future success,
and acknowledged that ESG priorities are embedded into our strategic and operational priorities.
Management collected and reported the feedback to the Compensation Committee, and the Committee
decided to integrate our core values of Diversity, Equity & Inclusion into compensation decisions
made for our associates who supervise a team of others, which range from store department leaders
through our senior officers. Specifically, one of several performance goals established for these
associates and senior officers relate to improvement in the Diversity, Equity and Inclusion category
score as measured by our annual Associate Insights Survey and active mentorship and development of
at least one other associate with a different background. These performance goals will be factored
into compensation decisions for these associates and senior officers, including salary increases and
the amount of the annual grant of equity awards, consistent with our program design as described
herein.

2021 Compensation Program Overview

The fixed and at-risk pay elements of the NEO compensation program are reflected in the

following table and charts.

Element

Form

Description

M
R
E
T
-
T
R
O
H
S

L
A
U
N
N
A

E
V
T
N
E
C
N

M
R
E
T
-
G
N
O
L

Base Salary

Cash

• Attract, Incentivize,

retain talented executives

• Benchmarked to peer group median
• Fixed Cash component

• Reviewed annually
• No automatic or guaranteed increases
• Based on individual performance
and experience

Annual
Incentive
Plan

Cash Bonus

• Metrics and targets align with annual business goals; payout depends on actual
performance against each goal
• Rewards and incentivizes Kroger employees, including NEOs, for annual perfor-
mance on key financial and operational metrics
• Benchmarked to peer group median

Performance-
Based Equity

Performance
Units

• Performance units are equity grants which are paid out in Kroger common shares,
dependent upon company performance against each goal, at the end of the
3-year performance period
• Measures performance on key financial and operational metrics over a 3-year
period
• Designed to create shareholder value, foster executive retention, and align NEO
and shareholder interests

Time-Based
Equity

Restricted
Stock

Stock
Options

• Stock options and restricted stock for NEOs vest ratably over 4 years; exercise
price of stock options is closing price on day of grant
• Provides direct alignment to stock price appreciation and rewards executives for
the achievement of long-term business objectives and providing Incentives for the

creation of shareholder value

D
E
X
F

K
S
R
-
T
A

E
L
B
A
R
A
V

Fiscal Year 2021 CEO Compensation

The Compensation Committee establishes Mr. McMullen’s target direct compensation such that
only 9% of his compensation is fixed. The remaining 91% of target compensation is at-risk, meaning
that the actual compensation Mr. McMullen receives will depend on the extent to which the Company
achieves the performance metrics set by the Compensation Committee, and with respect to all of the
equity vehicles, the future value of Kroger common shares.

The table below compares fiscal 2021 to 2020 target direct compensation. Target total direct

compensation is a more accurate reflection of how the Compensation Committee benchmarks and
establishes CEO compensation than the disclosure provided in the Summary Compensation Table,
which table includes a combination of actual base salaries and annual incentive compensation earned
in the fiscal year, the grant date fair market value of at-risk equity compensation to be earned in
future fiscal years, and the actuarial value of future pension benefits.

Increases to Mr. McMullen’s pay elements shown below were based on our independent

compensation consultant’s examination of pay levels and the Committee’s intention to achieve median
pay levels among our peer group. Target total compensation, which is the sum of target annual
compensation and target long term compensation is positioned around market median. The increase in
target long term compensation reflects the first increase in long term compensation since 2019.

($000s)

Year

2021
2020

Annual

Long-Term

Target
Annual
Incentive Total Annual

Salary

Performance
Units

Restricted
Stock

Stock
Options

Total
LTI

Target
TDC

$1,355 $2,500
$1,355 $2,500

$3,855
$3,855

$5,500
$5,250

$3,300 $2,200 $11,000 $14,855
$3,150 $2,100 $10,500 $14,355

Increase

+3.5%

CEO and Named Executive Officer Target Pay Mix

The amounts used in the charts below are based on 2021 target total direct compensation for the

CEO and the average of other Named Executive Officers. As illustrated below, 91% of the CEO’s target
total direct compensation is at-risk. On average, 83% of the other Named Executive Officers’
compensation is at risk.

CEO
Pay Mix

Performance
Units
37%

Stock Options
15%

Base Salary
9%

Average of
Other NEOs

Target Annual
Incentive
17%

Performance
Units
33%

83%
At Risk

91%
At Risk

Restricted Stock
22%

Stock Options
13%

Base Salary
17%

Target Annual
Incentive
17%

Restricted Stock
20%

Our Compensation Philosophy and Objectives

As one of the largest retailers in the world, our executive compensation philosophy is to attract and

retain the best management talent as well as motivate these associates to achieve our business and
financial goals. Kroger’s incentive plans are designed to reward the actions that lead to long-term value
creation. We believe our strategy creates value for shareholders in a manner consistent with Kroger’s
purpose: To Feed the Human Spirit. The Compensation Committee believes that there is a strong link
between our business strategy, the performance metrics in our short-term and long-term incentive
programs, and the business results that drive shareholder value.