UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 14A INFORMATION

Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934

(Amendment No.             )

Filed by the Registrant  ☒

Filed by a Party other than the Registrant  ☐

Check the appropriate box:

ON Semiconductor Corporation

(Name of Registrant as Specified In Its Charter)

(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

Payment of Filing Fee (Check the appropriate box):

☐      Fee paid previously with preliminary materials.

☐      Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing.

NOTICE OF ANNUAL MEETING OF STOCKHOLDERS

To the Stockholders:

The 2021 Annual Meeting of Stockholders of ON Semiconductor Corporation will be held at its principal executive office, located at 5005 East McDowell Road, Phoenix, Arizona 85008, on Thursday, May 20, 2021 at 8:00 a.m., local time, for the following purposes:

The Board of Directors of ON Semiconductor Corporation has fixed the close of business on March 23, 2021 as the record date for determination of stockholders entitled to notice of and to vote at the 2021 Annual Meeting of Stockholders or any adjournment or postponement thereof. For 10 days prior to the 2021 Annual Meeting of Stockholders, a list of stockholders entitled to vote at such meeting will be available for inspection in the office of the Law Department of ON Semiconductor Corporation, located at 5005 East McDowell Road, Phoenix, Arizona 85008, between the hours of 8:30 a.m. and 5:00 p.m., local time, each weekday. Such list will also be available at the 2021 Annual Meeting of Stockholders. Directions to the meeting location and related information may be found on our website at www.onsemi.com/annualmeeting.

Your vote is very important to us. We are providing access to our proxy materials online under the U.S. Securities and Exchange Commission’s “notice and access” rules. As a result, instead of mailing a paper copy of this proxy statement and our 2021 annual report to stockholders, we are mailing a notice to many of our stockholders that contains instructions on how to access documents online and how stockholders can receive a paper copy of our materials, including this proxy statement, our 2021 annual report to stockholders and a proxy card. Those stockholders who do not receive a notice, including stockholders who have previously requested to receive paper copies of our proxy materials, will receive a paper copy of our proxy materials by mail unless they have previously requested delivery of such materials electronically.

Sincerely yours,

Hassane S. El-Khoury

President and Chief Executive Officer

April 6, 2021

TABLE OF CONTENTS

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5005 East McDowell Road

Phoenix, Arizona 85008

PROXY STATEMENT

This proxy statement and the accompanying notice and proxy card are furnished in connection with the solicitation by the Board of Directors (the “Board” or “Board of Directors”) of ON Semiconductor Corporation (“we,” “ON Semiconductor” or the “Company”) of proxies to be used at our 2021 Annual Meeting of Stockholders to be held on Thursday, May 20, 2021 at 8:00 a.m., local time, at our principal executive office, located at 5005 East McDowell Road, Phoenix, Arizona 85008, and at any adjournment or postponement thereof (the “Annual Meeting”). We made this proxy statement available to stockholders beginning on or about April 6, 2021.

2021 Annual Meeting of Stockholders

Date and Time: Thursday, May 20, 2021, at 8:00 a.m., local time

Location: 5005 East McDowell Road, Phoenix, Arizona 85008

Record Date: The Board of Directors has fixed the close of business on March 23, 2021 as the record date for determination of stockholders entitled to notice of and to vote at the Annual Meeting (the “Record Date”).

Proxy Materials Are Available on the Internet

In accordance with the rules of the U.S. Securities and Exchange Commission (the “SEC”), we are furnishing proxy materials to our stockholders primarily via the internet instead of mailing printed copies of those materials to each stockholder. Unless you elected to receive printed copies of our proxy materials in prior years, you will receive a Notice of Internet Availability of Proxy Materials (the “Internet Notice”) by mail, or if you so elected, by electronic mail. The Internet Notice will tell you how to access and review our proxy materials and how to vote your shares after you have reviewed our proxy materials. If you received the Internet Notice by mail and would like to receive a printed copy of our proxy materials, you should follow the instructions included in the Internet Notice.

The Internet Notice is first being sent, and the proxy statement and form of proxy card relating to the Annual Meeting are first being made available, to stockholders on or about April 6, 2021.

Voting Your Shares

Whether or not you plan to attend the Annual Meeting, the Board encourages you to vote your shares as more fully described below and in the proxy card.

If you are the “record holder” of your shares, meaning that you hold the shares in your own name and not through a bank or brokerage firm (each, a “Broker”), you may vote in one of the following four ways:

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If the shares you own are held in “street name” by a Broker, then your Broker, as the record owner, will vote your shares according to your instructions. You will need to follow the directions your Broker provides you. Each share held by you is entitled to one vote.

Proof of Ownership Required for Attending Meeting in Person

You are entitled to attend the Annual Meeting only if you were a stockholder as of the close of business on the Record Date or hold a valid proxy for the Annual Meeting. In order to be admitted to the Annual Meeting, we may, in our sole discretion, require you to present any one or more of the following documents as proof of ownership of ON Semiconductor stock on the Record Date and authority to vote the shares:

We reserve the right not to admit anyone who refuses to provide the applicable documents set forth above.

Proposals and Board Recommendations

All shares represented by valid proxies will be voted as specified. If no specification is made, the proxies will be voted according to the Board’s recommendations below:

We are not aware of any other matters that will be brought before the stockholders for a vote at the Annual Meeting. If other matters properly come before the Annual Meeting, all shares validly represented by proxies will be voted in accordance with the discretion of the appointed proxies.

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Record Date and Quorum

The Board has fixed the close of business on the Record Date for determination of stockholders entitled to notice of and to vote at the Annual Meeting. As of the Record Date, there were 418,076,949 shares of our common stock outstanding and entitled to vote at the Annual Meeting. The presence, in person or by proxy, of holders of a majority of the shares entitled to vote at the Annual Meeting will constitute a quorum. Abstentions, withheld votes and Broker non-votes are included in determining whether a quorum has been met for the Annual Meeting. Abstentions include shares present in person but not voting and shares represented by proxy but with respect to which the holder has abstained.

Required Vote

With respect to Proposal No. 1 (Election of Directors), each of the members of the Board (collectively, the “Directors,” and individually, a “Director”) standing for election at the Annual Meeting must be elected by a majority of the votes cast with respect to such Director’s election, meaning that the number of votes cast “FOR” such Director must exceed the number of votes cast “AGAINST” that Director.

With respect to Proposal No. 2 (Advisory (Non-Binding) Resolution to Approve Named Executive Officer Compensation), Proposal No. 3 (Ratification of Selection of Independent Registered Public Accounting Firm), Proposal No. 4 (Approval of an Amendment to the ON Semiconductor Corporation 2000 Employee Stock Purchase Plan) and Proposal No. 5 (Approval of Amendments to the ON Semiconductor Corporation Amended and Restated Stock Incentive Plan), in order for each proposal to be approved, it must receive a “FOR” vote from a majority of the shares present in person or by proxy at the Annual Meeting and entitled to vote on the proposal.

Abstentions and Broker non-votes, as applicable, are not treated as votes cast and, therefore, will have no effect on the outcomes of any of the proposals. Broker non-votes occur when a nominee holding shares for a beneficial owner does not vote on a particular proposal because the nominee does not have discretionary voting power on that item and has not received instructions from the beneficial owner. Although Brokers have discretionary power to vote your shares with respect to “routine” matters, they do not have discretionary power to vote your shares on “non-routine” matters.

Notably, your Broker is NOT able to vote on your behalf in any Director election or with respect to Proposal Nos. 2, 4 or 5 without specific voting instructions from you. Accordingly, if your shares are held in “street name” and you cannot attend the Annual Meeting in person, we encourage you to vote your shares on all proposals by promptly instructing your Broker as to how to vote on these matters so that your shares will be voted at the Annual Meeting.

Revocation of Proxies

You may revoke your proxy at any time before it is voted by attending the Annual Meeting and voting in person or by submitting a written notice of revocation or a properly executed proxy bearing a later date to our Secretary at our principal executive office, located at 5005 East McDowell Road, Phoenix, Arizona 85008.

MANAGEMENT PROPOSALS

Proposal No. 1: Election of Directors

The Board routinely assesses its size and composition and the skillsets of each Director to ensure an appropriate complement of perspectives and skills in light of the Company’s current and future business objectives and the evolving nature of the Company’s product offerings and technology in the highly competitive semiconductor industry. Each Director stands for election annually. Once elected, Directors hold office until their terms expire at the next annual meeting of stockholders and until their successors are duly elected and qualified, or until the earlier of their death, resignation or removal. Each nominee for Director will be nominated at the Annual Meeting to serve for a term expiring at the 2022 Annual Meeting of Stockholders (the “2022 Annual Meeting”), and each of the nominees has agreed to serve as a Director if elected by the stockholders.

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Director Nominees

The following is a summary of information about each nominee for Director and certain aggregated characteristics of our Board:

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Set forth below is additional information concerning the nominees for Director. In addition to the specific qualifications described below, we believe that each Director has the business acumen and sound judgment required for the proper functioning of our Board and the integrity, honesty and adherence to high ethical standards necessary to set the “tone at the top” for our Company. Most of our Directors also have significant experience on other public company boards of directors that broadens their knowledge of board processes, issues and solutions.

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Required Vote

Upon recommendation of the Corporate Governance and Nominating Committee of the Board (the “Corporate Governance and Nominating Committee”), the Board has concluded that re-nominating each Director described above would strike the appropriate balance of perspectives and qualifications on the Board and align with the Company’s current and future business objectives.

To be elected, each of the nominees for Director must receive the affirmative vote of the majority of votes cast, meaning that the number of votes cast “FOR” a nominee must exceed the number of votes cast “AGAINST” that nominee. Unless you withhold your vote or indicate otherwise on your proxy card, and except in a case of a Broker non-vote, proxies will be voted “FOR” the election of the nominees for Director. The Board has no reason to believe that any of the nominees for Director will be unable to serve. If, however, any one of them should become unavailable, the Board may reduce the size of the Board or designate a substitute nominee. If the Board designates a substitute nominee, shares represented by proxies will be voted for the substitute nominee.

The Board of Directors recommends a vote “FOR” the election of each of the nominees for Director in Proposal No. 1.

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Proposal No. 2: Advisory (Non-Binding) Resolution to Approve Named Executive Officer Compensation

As required by Section 14A of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), we are asking for stockholder approval of the compensation of our named executive officers identified in the “Compensation Discussion and Analysis — Overview” section of this proxy statement (the “NEOs”). The Board of Directors recommends that our stockholders approve such compensation by approving the following advisory resolution:

RESOLVED, that the stockholders of ON Semiconductor Corporation approve, on an advisory basis, the compensation of the Company’s named executive officers identified in the Summary Compensation Table included in this proxy statement as such compensation is described pursuant to Item 402 of Regulation S-K in this proxy statement (which disclosure includes the Compensation Discussion and Analysis and the compensation tables and accompanying footnotes and narratives under the heading “Compensation of Executive Officers” in this proxy statement).

The principal objective of our compensation programs is to attract, retain and motivate highly talented individuals who will deliver competitive financial returns to our stockholders and accomplish our short-term and long-term plans and goals. The Company seeks to accomplish this objective by rewarding performance, both individual and corporate, in a way that is aligned with the short-term and long-term interests of the Company and its stockholders. Consistent with this philosophy, the majority of the total compensation opportunity for each of our NEOs is incentive-based, and a significant portion of such compensation is dependent upon the Company’s or the individual’s achievement of specified and predetermined financial and operational goals. The Company believes that its executive compensation program satisfies the Company’s compensation objectives. We describe our compensation policies and programs in more detail below in this proxy statement, including in the Compensation Discussion and Analysis section of this proxy statement (the “CD&A”).

As an advisory vote, this proposal is not binding upon the Company. However, the Compensation Committee of the Board (the “Compensation Committee”), which is responsible for designing and administering the Company’s executive compensation programs, values the opinions expressed by stockholders. If there are a significant number of negative votes, the Compensation Committee will seek to understand the concerns that influenced the voting and will consider whether any actions are necessary to address those concerns.

The Board has previously adopted a policy providing for an annual advisory vote to approve the compensation of our NEOs. Unless the Board modifies its current policy, the next advisory vote will be at the 2022 Annual Meeting.

Required Vote

The affirmative vote of a majority of the votes duly cast on this item is required to approve this Proposal No. 2. Abstentions and Broker non-votes are not treated as votes cast and, therefore, will have no effect on the outcome of this Proposal No. 2.

The Board of Directors recommends a vote “FOR” the advisory (non-binding) resolution to approve the compensation of our NEOs in Proposal No. 2.

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Proposal No. 3: Ratification of Selection of Independent Registered Public Accounting Firm

The Audit Committee of the Board (the “Audit Committee”): (i) has selected PricewaterhouseCoopers LLP (“PricewaterhouseCoopers”) as the independent registered public accounting firm to (1) audit our consolidated financial statements for the year ending December 31, 2021, and (2) render other services as required of them, including to report on the effectiveness of our internal control over financial reporting as of December 31, 2021; and (ii) is seeking ratification of this selection from the stockholders of the Company. PricewaterhouseCoopers has served as the Company’s independent auditor since 1999.

In determining whether to retain PricewaterhouseCoopers as our 2021 independent auditor, the Audit Committee considered, among other things:

Based on this evaluation, the Audit Committee believes that the retention of PricewaterhouseCoopers as our independent auditor for the year ending December 31, 2021 is in the best interest of the Company and our stockholders.

A representative of PricewaterhouseCoopers is expected to be present at the Annual Meeting. If present, the representative will have an opportunity to make a statement, if such representative desires to do so, and will be available to respond to appropriate questions by stockholders.

Stockholder ratification of the selection of PricewaterhouseCoopers as our independent registered public accounting firm is not required by the bylaws of the Company (the “Bylaws”) or otherwise. Nonetheless, the Audit Committee is submitting the selection of PricewaterhouseCoopers to the stockholders for ratification as a matter of good corporate practice and because the Audit Committee values stockholders’ views on our independent auditor.

If the stockholders fail to ratify the selection, the Audit Committee may reconsider the selection of PricewaterhouseCoopers. Even if the selection is ratified, the Audit Committee, in its discretion, may select a different independent registered public accounting firm at any time during the year if it determines that such a selection would be in our best interest and the best interest of our stockholders.

Audit and Related Fees

The Audit Committee reviews and approves audit and permissible non-audit services performed by PricewaterhouseCoopers, as well as the fees charged by PricewaterhouseCoopers for such services. In its review of non-audit services and fees and its selection of PricewaterhouseCoopers as our independent registered public accounting firm, the Audit Committee considered whether the provision of such services is compatible with maintaining PricewaterhouseCoopers’ independence. The table below sets forth the aggregate fees for audit and other services provided by PricewaterhouseCoopers for each of the past two fiscal years.

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Policy on Audit Committee Pre-Approval of Audit and Permissible Non-Audit Services

Under the Audit Committee’s charter, the Audit Committee must pre-approve all audit and permitted non-audit services (including the fees and terms thereof) to be performed by our independent registered public accounting firm, except for any de minimis non-audit services that are approved by the Audit Committee prior to the completion of the audit and that qualify for the de minimis exception under federal securities laws and regulations. The Audit Committee may delegate to one or more members of the Audit Committee the authority to grant pre-approvals of audit and permitted non-audit services, provided that such decisions shall be presented to the full Audit Committee at its next scheduled meeting.

The Audit Committee’s pre-approval policy (the “Pre-Approval Policy”) requires the Audit Committee to pre-approve certain audit, audit-related, tax and other services to be performed by our independent registered public accounting firm. With certain exceptions, the term of pre-approval is 12 months from the date of pre-approval. The Audit Committee periodically revises the list of pre-approved services. The Audit Committee may delegate pre-approval authority to one or more of its members, who must report any pre-approval decisions to the full Audit Committee, but may not delegate such decisions to management. In granting any such pre-approvals, the Audit Committee considers the extent to which approved services could impair the independence of our independent registered public accounting firm. With respect to each proposed pre-approved service, the auditor must provide the Audit Committee, upon request, with detailed back-up documentation regarding the specific services to be performed. During 2020 and 2019, all audit and permissible non-audit services were pre-approved by the Audit Committee pursuant to the Pre-Approval Policy and its charter.

The Audit Committee has determined that the provision of services described above is compatible with maintaining PricewaterhouseCoopers’ independence.

Required Vote

The affirmative vote of a majority of the votes duly cast on this item is required to approve this Proposal No. 3. Abstentions are not treated as votes cast and, therefore, will have no effect on this Proposal No. 3.

The Audit Committee and the Board of Directors recommend a vote “FOR” the approval of Proposal No. 3.

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Proposal No. 4: Approval of an Amendment to the ON Semiconductor Corporation 2000 Employee Stock Purchase Plan

The Company’s stockholders are being asked to approve an amendment to increase the cumulative total number of shares of common stock issuable under the ON Semiconductor Corporation 2000 Employee Stock Purchase Plan, as most recently amended as of May 17, 2017 (the “ESPP”), by 6,000,000 shares from 28,500,000 shares to 34,500,000 shares. The ESPP provides eligible employees of the Company and its participating subsidiaries with the opportunity to purchase shares of our common stock through convenient payroll deductions, except where prohibited by law. The Company utilizes proceeds from the sale of ESPP shares for general corporate purposes.

On March 17, 2021 (the “Proposal No. 4 Effective Date”), the Board approved the adoption of an amendment to the ESPP, subject to stockholder approval under this Proposal No. 4. If approved by our stockholders, this Proposal No. 4 will become effective as of the Proposal No. 4 Effective Date and will increase the number of shares of common stock authorized for issuance under the ESPP by 6,000,000 shares, for a cumulative total of 34,500,000 shares (which includes all shares previously issued under the ESPP). If not approved by our stockholders, the amendment described in this Proposal No. 4 will not become effective and our ability to continue using the ESPP will be limited to the remaining share reserve. As of the Proposal No. 4 Effective Date, the total number of shares remaining available for issuance under the ESPP was 2,950,704, and the total number of shares of our common stock outstanding was 416,428,407, resulting in a dilution percentage of 0.71%.

Since January 1, 2018, the percentage of the Company’s employees in the U.S. and Malaysia who participate in the ESPP has increased from 28% to 33%, which accelerated the usage of available shares under the ESPP. In addition, during 2020, our stock price fluctuated between $8.17 and $32.93, and such volatility makes it difficult to predict our future share usage. Consequently, the Board believes it to be in the Company’s best interest to seek to obtain stockholder approval of an increase in the ESPP share reserve at the Annual Meeting. Assuming the approval of this Proposal No. 4 by our stockholders, we expect that the requested increase of 6,000,000 shares, or 1.4% of our total common stock outstanding as of the Proposal No. 4 Effective Date, would allow for at least five additional years of ESPP purchases and will give us the ability to continue to attract and retain the talented employees necessary for our continued growth and success.

Set forth below is a summary of the principal provisions of the ESPP, as amended by the amendment set forth in this Proposal No. 4. The summary is not exhaustive and is qualified by reference to the full text of the ESPP, as amended by the amendment set forth in this Proposal No. 4, which is attached to this proxy statement as Appendix A.

Summary of Material Terms of the ESPP

Purpose. The Board believes that the ESPP encourages ownership of common stock of the Company by all eligible employees and provides incentives for them to exert maximum efforts for the success of the Company and its affiliates. The ESPP is intended to qualify as an employee stock purchase plan under Section 423 of the Internal Revenue Code of 1986, as amended (the “Code”).

Administration. The ESPP is administered by the Compensation Committee. In the discussion that follows with respect to this Proposal No. 4, all references to the “Committee” will mean the Compensation Committee. Subject to the terms of the ESPP, the Committee has the authority to adopt, amend, suspend, waive and rescind rules and regulations as it deems necessary or advisable to administer the ESPP, to correct any defect, supply any omission or reconcile any inconsistency in the ESPP and to construe and interpret the ESPP and the rules and regulations thereunder. The Committee may also make any other decision and determination under the ESPP, including determinations relating to eligibility.

Stock Subject to the ESPP. The total number of shares of common stock authorized for issuance pursuant to the ESPP is 28,500,000. If the ESPP Amendment is adopted, the total number of shares authorized for issuance will be increased to 34,500,000. Shares sold under the ESPP may consist of newly issued shares, treasury stock or stock purchased on the open market. The amount of stock reserved for issuance pursuant to the ESPP is subject to adjustment in the event of certain changes in capital structure as described below under “Adjustment Provisions.”

Eligibility. The Committee has the authority to designate the subsidiaries of the Company whose employees may participate in the ESPP. The Committee has delegated to the Chief Executive Officer (the “CEO”) and/or to the President of the Company

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the authority to designate new United States and Malaysian subsidiaries of the Company that are eligible to be participating employers in the ESPP, subject to certain restrictions. All employees of the Company or any Company subsidiary designated by the CEO are eligible to participate in the ESPP, so long as such employees are employed by the Company or a subsidiary authorized to participate in the ESPP on the first day of the offering period. An employee is not eligible, however, if he or she owns or has the right to acquire 5% or more of the voting stock of the Company or of any subsidiary of the Company. Also, an employee is not eligible if he or she is normally scheduled to work less than or equal to 20 hours per week or five months per calendar year or if the employee has been employed by the Company for less than 90 days. An employee who is a citizen or resident of a foreign jurisdiction will be ineligible to participate in the ESPP if the offering is prohibited under the laws of such foreign jurisdiction or if compliance with the laws of such foreign jurisdiction would cause the offering to violate Section 423 of the Code. The ESPP is intended to be a broad-based compensation plan and currently the only subsidiaries of the Company whose employees are eligible to participate in the ESPP are certain of the Company’s United States and Malaysian subsidiaries. As of December 31, 2020, there were approximately 9,500 employees eligible to participate in the ESPP, subject to limitations of local law and tax policy.

Enrollment and Contributions. Eligible employees voluntarily elect whether to enroll in the ESPP. Currently, employees may join for a period of three months, which is the maximum offering period provided for in the ESPP. Employees who have joined the ESPP are automatically re-enrolled for additional rolling three-month periods so long as the employee remains eligible under the rules of the ESPP. However, an employee may cancel his or her enrollment at any time, subject to certain provisions of the ESPP. Employees may contribute to the ESPP through payroll deductions. Participating employees generally may contribute up to 10% of their eligible compensation through after-tax payroll deductions. From time to time, the Committee may establish a lower or higher maximum permitted contribution percentage. An employee may change the payroll contribution amount for a future offering period by filing a new enrollment form at least two weeks prior to the beginning of the offering period. An employee may discontinue payroll contributions during an offering period by filing a new enrollment form, and the change will be effective for the next payroll after the enrollment form is received.

Purchase of Shares. At the end of each offering period, each participating employee’s payroll deductions are used to purchase shares of common stock for the employee. The price of the shares purchased will be 85% of the lower of: (i) the stock’s fair market value on the first day of the three-month offering period; or (ii) the stock’s fair market value on the last day of the offering period. Currently, during any single offering period, no employee may purchase more than the lesser of: (i) 500 shares of common stock; or (ii) the number of shares derived by dividing $6,250 by 100% of the fair market value of one share of common stock on the first day of the offering period. In the event that an employee’s payroll contribution is greater than the amount the employee is able to purchase, the excess amount will be returned to the employee as soon as practicable after the end of the offering period.

Termination of Participation. Participation in the ESPP terminates when a participating employee’s employment with the Company and its subsidiaries ceases for any reason, the employee withdraws from the ESPP, the employee becomes ineligible to participate under the rules of the ESPP, whether by amendment of the ESPP or otherwise, or the ESPP is terminated.

Adjustment Provisions. In the event of any extraordinary dividend or other distribution, recapitalization, forward or reverse split, reorganization, merger, consolidation, spin-off, combination, repurchase, share exchange or other similar corporate transaction or event affecting the stock, the number and kind of shares subject to the ESPP will be proportionally adjusted by the Committee.

Amendment, Modification and Termination of the ESPP. The Board may amend or terminate the ESPP at any time for any reason unless stockholder approval is required by federal or state law or regulation or the rules of the automated quotation system or stock exchange on which the Company’s common stock is quoted or listed, or is necessary in order for the ESPP to continue to meet the requirements of Section 423 of the Code. If stockholder approval is required, such approval must be obtained within one year of Board action. No amendment or termination of the ESPP may materially and adversely affect the rights of a participant without such participant’s consent.

Federal Income Tax Information. The following is a brief summary of certain of the federal income tax consequences of the purchase of shares of stock under the ESPP. This summary is not intended to be exhaustive and does not describe state, local or foreign income tax consequences that may also be applicable. Participants in the ESPP should consult their own professional tax advisors concerning tax aspects of rights under the ESPP. Nothing in this proxy statement is written or intended to be used, and cannot be used, for the purposes of avoiding taxpayer penalties. The discussion below concerning tax deductions that may become available to the Company under U.S. federal tax law is not intended to imply that the

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Company will necessarily obtain a tax benefit or asset from those deductions. Taxation of equity-based payments in other countries is complex, does not generally correspond to U.S. federal tax laws and is not covered by the summary below. Under a plan which qualifies as an employee stock purchase plan under Section 423 of the Code, as a general rule, an employee does not recognize taxable income when shares of stock are purchased through the ESPP. An employee will, however, generally recognize taxable income upon the sale or disposition of stock purchased through the ESPP. For shares that are disposed of more than 24 months after the first day of the offering period under which shares were purchased and more than one year after the actual purchase date of those shares (a “qualifying disposition”), the participant will recognize ordinary income in the year of such sale or disposition equal to the lesser of: (i) the amount by which the fair market value of the shares on the sale or disposition date exceeds the purchase price paid for those shares; or (ii) the excess of the fair market value of the shares on the start date of the offering period over the purchase price (however, if the purchase price is based on the lower of the value of the stock on the first day of the offering period or the purchase date, the purchase price discount is computed as of the first day of the offering period for this purpose). Any additional gain above that amount is taxed at the long-term capital gains rates. If the employee sells the stock for less than the purchase price, there will be no ordinary income. Instead, the employee will have a long-term capital loss for the difference between the sale price and the purchase price. If a participant disposes of shares during the 24-month period after the first day of the offering period in which shares were purchased or within one year after the actual purchase date of the shares (a “disqualifying disposition”), the employee will recognize ordinary income in the year of such sale or disposition on the difference between the purchase price and the fair market value of the stock on the actual purchase date, regardless of whether there is any gain upon such disposition. Any additional gain (or loss) is taxed to the stockholder as long-term or short-term capital gain (or loss). The purchase date starts the holding period for determining whether the gain (or loss) is short-term or long-term.

Tax Consequences to the Company or Its Affiliates. If an employee makes a disqualifying disposition, the Company or an affiliate of the Company generally will receive a deduction equal to the amount of ordinary income an employee must recognize for the year of the disqualifying disposition. Neither the Company nor any affiliate of the Company will receive a deduction for qualifying dispositions.

New Plan Benefits. Benefits under the ESPP will depend on the number of employees who elect to participate in the ESPP and the fair market value of the Company’s stock at various future dates. Consequently, it is not possible to determine the future benefits that will be received by participants in the ESPP.

Prior Purchases under the ESPP. The following table sets forth the purchases made in the 2020 fiscal year under the ESPP by each of the NEOs, the Company’s current executive officers as a group, current non-employee Directors (“Outside Directors”) as a group, each of the nominees for Director, all other current employees, including current officers who are not executive officers, as a group, each associate of any Directors, executive officers or nominees for Director and each other person who received, or is to receive, 5% of such options, warrants or rights.

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Required Vote

The affirmative vote of a majority of the votes duly cast on this item is required to approve this Proposal No. 4. Abstentions and Broker non-votes are not treated as votes cast and, therefore, will have no effect on the approval of this Proposal No. 4.

The Board of Directors recommends a vote “FOR” the approval of an amendment to the 2000 Employee Stock Purchase Plan as described in this Proposal No. 4.

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Management Proposals

Proposal No. 5: Approval of Amendments to the ON Semiconductor Corporation Amended and Restated Stock Incentive Plan

The Company’s stockholders are being asked to approve certain amendments to the ON Semiconductor Corporation Amended and Restated Stock Incentive Plan, as most recently amended as of May 17, 2017 (the “2010 SIP”).

General Information

Under its current terms, the 2010 SIP will expire on the date of the 2022 Annual Meeting and provides for the grant of incentive stock options, non-qualified stock options, time-based restricted stock units (“RSUs”), restricted stock, performance shares, performance share units, performance cash awards, stock appreciation rights (“SARs”) and stock grant awards. For the reasons set forth in this Proposal No. 5, the Company believes that it is prudent to seek stockholder approval at the Annual Meeting to approve certain amendments to the 2010 SIP as described in this Proposal No. 5.

Among other amendments described below, Proposal No. 5 proposes to increase the number of authorized shares under the 2010 SIP from 87,000,000 shares to 109,500,000 shares. Based on estimated share usage as of March 17, 2021 (the “Proposal No. 5 Effective Date”), we do not expect that the 2010 SIP’s share reserve will be depleted before the 2022 Annual Meeting. However, given the Company’s belief that there is a need to increase the share reserve for the ESPP at this time (as described in Proposal No. 4), and because the Company believes that we will need to extend the term of the 2010 SIP or adopt a new stock incentive plan prior to the 2010 SIP’s current expiration date at the 2022 Annual Meeting, the Company has determined that seeking stockholder approval of this Proposal No. 5 is a prudent and administratively efficient course of action. The Board believes that the proposed 22,500,000 share increase to the 2010 Plan’s share reserve described below in this Proposal No. 5 will provide us with sufficient shares for our equity compensation program for at least five years. If this Proposal No. 5 is approved by our stockholders, it will become effective as of the Proposal No. 5 Effective Date. If this Proposal No. 5 is not approved by our stockholders, awards will continue to be made under the 2010 SIP as currently in effect, to the extent shares are available, until the 2010 SIP expires on the date of the 2022 Annual Meeting.

As shown in the following table, based on the burn rate methodology used by the Company, the Company’s three-year average annual burn rate as of December 31, 2020 is 1.23%. If adjusted to utilize the same burn rate methodology as Institutional Shareholder Services Inc. (“ISS”), the Company’s three-year average annual burn rate as of December 31, 2020 is 1.85%, which is well below the adjusted “burn rate benchmark” of 6.23% for the Company’s industry as calculated using ISS’s burn rate methodology. If adjusted to reflect forfeitures due to employee terminations, then the Unadjusted Burn Rate (as calculated below) would be 1.08% and the Adjusted Burn Rate (as calculated below) would be 1.61%.

Shares are stated in millions, rounded to conform to the Company’s annual report on Form 10-K for the year ended December 31, 2020, as filed with the SEC on February 16, 2021 (the “Form 10-K”), where applicable.

Summary of Proposed Amendments to, and Other Material Terms of, the 2010 SIP

On the Proposal No. 5 Effective Date, the Board approved, subject to stockholder approval, the amendments to the 2010 SIP that we are now asking stockholders to approve in this Proposal No. 5. The proposed amendments to the 2010 SIP that have been approved by the Board are:

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Management Proposals

Set forth below is a summary of the material terms of the 2010 SIP, as amended by the amendments contained in this Proposal No. 5. The summary is not exhaustive and is qualified by reference to the full text of the 2010 SIP, as amended by the amendments set forth in this Proposal No. 5, which is attached to this proxy statement as Appendix B. Capitalized terms used but not defined herein have the meanings given to such terms in the 2010 SIP.

Term, Amendment, Modification and Termination. Subject to the Board’s right to amend or terminate the 2010 SIP at any time, unless our stockholders approve the amendments described under this Proposal No. 5, the 2010 SIP will expire on, and no award may be granted under the 2010 SIP following, the date of the 2022 Annual Meeting. Any awards outstanding on the date of the 2022 Annual Meeting will remain in effect according to the terms of the applicable Award Agreement and the 2010 SIP.

Purpose. The Board believes that the 2010 SIP promotes the success and enhances the long-term growth of the Company. The 2010 SIP was designed to provide participants with an incentive for outstanding performance in order to generate superior returns for the Company’s stockholders. The Board believes that this alignment between participant incentives and stockholder value is in the best interest of the Company and its stockholders. The Board also believes that the 2010 SIP allows the Company to attract, retain and motivate individuals upon whose judgment, interest and effort the successful conduct of the Company’s operations is largely dependent.

Administration. The 2010 SIP provides that it will be administered by the Compensation Committee or another committee (referred to as a subcommittee) of the Board. In the discussion that follows with respect to this Proposal No. 5, references to the “Committee” will mean the committee (or subcommittee) of the Board appointed to administer the 2010 SIP. Each Committee member (or member of any applicable subcommittee of the Committee) must be a “non-employee director” as defined in Rule 16b-3 of the Exchange Act if required to meet the conditions of exemption for awards from Section 16(b) of the Exchange Act. Due to the repeal of the performance-based exception under Section 162(m), this Proposal No. 5 contemplates the removal of a provision in the 2010 SIP that, for specified grants, required Committee members to meet the committee independence requirements in Section 162(m). The Committee, by majority action, is authorized to interpret the 2010 SIP, to prescribe, amend and rescind rules and regulations relating to the 2010 SIP, to provide for conditions and assurances deemed necessary or advisable to protect the interests of the Company and to make all other determinations necessary for the administration of the 2010 SIP to the extent they are not contrary to express provisions of the 2010 SIP.

The Committee has the authority, without limitation, to determine: (i) the participants who are entitled to receive awards under the 2010 SIP; (ii) the types of awards; (iii) the times when awards shall be granted; (iv) the number of awards; (v) the purchase price or exercise price of awards, if any; (vi) the period(s) during which such awards shall be exercisable (whether in whole or in part); (vii) the restrictions applicable to awards; (viii) the form of each Award Agreement; (ix) the other terms and provisions of any award; and (x) the schedule for lapse of forfeiture restrictions or restrictions on the exercisability of an award and accelerations or waivers thereof, based in each case on such considerations as the Committee, in its sole discretion, determines. The Committee also has the authority to modify existing awards to the extent permitted under the 2010 SIP.

Pursuant to the Amended and Restated Guidelines on the Delegation of Authority to the Chief Executive Officer to Make Certain Awards or other specific written delegation promulgated from time to time by the Committee in accordance with applicable law and subject to certain restrictions and limitations (the “Delegated Authority Guidelines”), the CEO has the authority to grant awards to individuals to expedite the hiring process and retain talented employees. However, the CEO does not have the authority to grant awards to any Director or “Senior Officer” (as such term is defined in the Delegated Authority Guidelines) or to grant awards above certain dollar thresholds.

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Management Proposals

Stock Subject to the 2010 SIP. Subject to adjustment in the event of certain changes in capital structure as described below under “Adjustment Provisions,” as of February 25, 2021, 16,908,154 shares of stock were reserved and available for awards granted under the 2010 SIP. If this Proposal No. 5 is approved by our stockholders, the number of shares available for grant would be increased by 22,500,000 shares to 39,408,154 shares. The 2010 SIP contains what is commonly referred to as a “fungible” share counting mechanism under which full value awards (that is, awards other than options and SARs) deplete the share reserve by 1.58 shares for each share underlying the award, and options and SARs deplete the share reserve by one share for each share underlying the option or SAR award. Under the 2010 SIP, if an award terminates, expires, lapses or is settled in cash rather than shares, the number of shares that was debited from the share reserve upon granting the award is added back – 1.58 shares for full value awards and one share for options and SARs. The maximum number of shares of stock that may be issued as incentive stock options under the 2010 SIP is 6,000,000. Shares delivered pursuant to the 2010 SIP may consist of authorized but unissued stock, treasury stock or stock purchased on the open market.

The exercise of a stock-settled SAR or Broker-assisted “cashless” exercise of an option (or a portion thereof) will reduce the 2010 SIP’s share reserve by the entire number of shares of stock subject to that SAR or option (or applicable portion thereof), even though a smaller number of shares of stock will be issued upon such an exercise. Also, shares of stock tendered to pay the exercise price of an option or tendered or withheld to satisfy a tax withholding obligation arising in connection with an award will not become available for grant or sale under the 2010 SIP.

Eligibility. All employees (including officers), Outside Directors and consultants of the Company and its affiliates are eligible to be selected to receive awards under the 2010 SIP, subject to Committee discretion as described below. On the Proposal No. 5 Effective Date, there were approximately 14,357 employees, 10 Outside Directors and 5,543 consultants eligible to participate in the 2010 SIP, subject to limitations of local law and tax policy. Subject to certain conditions, prospective employees, Outside Directors and consultants may also be granted awards. Any such awards to prospective employees, Outside Directors or consultants may not vest, become exercisable, be issued or become effective before the individual begins providing services.

The Committee may establish additional terms, conditions, rules or procedures to accommodate the rules or laws of non-U.S. jurisdictions, to allow for tax-favored treatment of awards granted to participants who reside outside of the United States or to otherwise provide for participation by participants who reside outside of the United States. The Committee may also approve any sub-plans, supplements to or amendments, restatements or alternate versions of the 2010 SIP as the Committee deems necessary to accomplish these purposes without affecting the terms of the 2010 SIP as in effect for any other purpose, provided that these documents do not increase the share limitations set forth in the 2010 SIP.

Types of Awards. The following types of awards may be granted pursuant to the 2010 SIP:

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Section 162(m)-Specific Provisions. The 2010 SIP contains provisions relating to certain awards that were intended to comply with the performance-based compensation exception under Section 162(m) and places certain limits on the size of awards that could be granted to certain employees if the awards were intended to qualify for the performance-based compensation exception under Section 162(m). The Tax Act eliminated the performance-based compensation exception under Section 162(m), except with respect to certain grandfathered awards. As a result of this change in tax laws, we are no longer able to grant awards that qualify for the performance-based compensation exception and, consequently, the provisions in the 2010 SIP that apply only to such awards are no longer of any effect. For this reason, if approved by stockholders, the amendments described in this Proposal No. 5 would remove these Section 162(m)-specific provisions, including the individual award limits referenced above. Nevertheless, the 2010 SIP retains provisions relating to awards that were not intended to qualify for this exception and the Company may continue to grant awards under the 2010 SIP that contain vesting or other terms that relate to performance-based conditions.

The Committee has the discretion to select the length of the performance period (which may be one or more periods of time of varying and overlapping durations, over which the attainment of one or more performance goals will be measured), the type of performance compensation award to be issued, the kind and/or level of performance goal or goals and whether the performance goal or goals apply to the Company, an affiliate or any division or business unit of any of them, or to the individual participant or any group of participants. The Committee also has the discretion to evaluate the achievement of the performance goals in a manner that includes or excludes certain events that may occur during the performance period.

Minimum Vesting Periods. Full value awards, such as restricted stock, RSUs, performance shares and performance share units, are subject to minimum vesting periods under the 2010 SIP. Full value awards that are exclusively subject to time-based vesting must have a vesting period of at least three years, while stock options, SARs and awards that are subject to performance-based vesting must have a vesting period of at least one year. These awards may vest in increments during the

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Management Proposals

applicable vesting period. The Committee, in its discretion, may provide in the applicable Award Agreement for any full value award that the award vests, in whole or in part, on the participant’s termination of employment. The Committee may grant full value awards that are not subject to the minimum vesting requirements, provided that the sum of the number of shares of common stock subject to these awards plus the number of shares of stock subject to stock grant awards does not exceed 5% of the shares of stock available for the grant of awards pursuant to the 2010 SIP.

Outside Director Award Limit. Subject to adjustment upon the occurrence of any of the events indicated in Section 5.3 of the 2010 SIP, the maximum number of shares of stock that may be granted to any participant who is an Outside Director during any calendar year is 40,000 shares of stock.

Restrictions. The Committee may impose such restrictions on any awards under the 2010 SIP as it may deem advisable, including restrictions under applicable federal securities law, under the requirements of any stock exchange upon which the common stock is then listed and under any blue sky or state securities law applicable to the awards.

Change in Control. Under the 2010 SIP, upon a Change in Control, the Board has the discretion to provide that all or part of any outstanding options, SARs and other awards shall become fully exercisable and all or part of the restrictions on outstanding awards shall lapse. Upon, or in anticipation of, such an event, the Committee may cause every award outstanding under the 2010 SIP to terminate at a specific time in the future and shall give each participant the right to exercise awards during a period of time as the Committee, in its sole and absolute discretion, shall determine.

Non-transferability. The Committee may, in its sole discretion, determine the right of a participant to transfer any award granted under the 2010 SIP. Unless otherwise determined by the Committee, no award granted under the 2010 SIP may be sold, transferred, pledged, assigned or otherwise alienated or hypothecated, other than by will or by the laws of descent and distribution or pursuant to a domestic relations order in favor of a spouse (that would otherwise qualify as a qualified domestic relations order as defined in the Code or Title I of the Employee Retirement Income Security Act of 1974, as amended, but for the fact that the order pertains to an award), or, if applicable, until the termination of any restricted or performance period as determined by the Committee. A participant may, in the manner determined by the Committee, designate a beneficiary to exercise the rights of the participant and to receive any distribution with respect to any award upon the participant’s death.

Adjustment Provisions. If there is a change in the outstanding shares of common stock because of a stock dividend or split, recapitalization, merger, consolidation, combination, exchange of shares or other similar corporate change, the aggregate number of shares of stock available under the 2010 SIP and subject to each outstanding award, and its stated exercise price or the basis upon which the award is measured, will be adjusted appropriately by the Committee. Moreover, in the event of such transaction or event, the Committee, in its discretion, may provide in substitution for any or all outstanding awards under the 2010 SIP such alternative consideration (including cash) as it, in good faith, may determine to be equitable under the circumstances and may require in connection therewith the surrender of all awards so replaced. Any adjustment to an incentive stock option shall be made consistent with the requirements of Section 424 of the Code. Further, with respect to any option or SAR that otherwise satisfies the requirements of the stock rights exception to Section 409A of the Code (“Section 409A”), any adjustment shall be made consistent with the requirements of the final regulations promulgated pursuant to Section 409A.

Amendment, Modification and Termination of the 2010 SIP. The Board has discretion to terminate, amend or modify the 2010 SIP at any time. Any such action of the Board is subject to the approval of the stockholders to the extent required by law, regulation or the rules of any exchange on which the common stock is listed, quoted or traded. To the extent permitted by law, the Board may delegate to the Committee or the CEO the authority to approve non-substantive amendments to the 2010 SIP. Except as otherwise provided in the 2010 SIP, the Board, the CEO and the Committee may not do any of the following without stockholder approval: (i) reduce the purchase price or exercise price of any outstanding award, including any option or SAR; (ii) increase the number of shares available under the 2010 SIP (except in connection with any adjustment described in the “Adjustment Provisions” section above); (iii) grant options with an exercise price that is below fair market value of a share of common stock on the Grant Date; (iv) reprice previously granted options or SARs; (v) cancel any option or SAR in exchange for cash or any other award or in exchange for any option or SAR with an exercise price that is less than the exercise price for the original option or SAR; or (vi) expand the: (1) class of participants eligible to receive an award under the 2010 SIP, or (2) types of awards available for grant under the 2010 SIP. The 2010 SIP or any Award Agreement may also be amended to comply with Section 409A or to exclude or exempt the 2010 SIP or any Award Agreement from the requirements of Section 409A.

Tax Withholding. The Company may withhold, or require a participant to remit to the Company, up to the maximum amount necessary to satisfy federal, state and local withholding tax requirements on any award under the 2010 SIP. To the extent permissible under applicable tax, securities and other laws, the Company may, in its sole discretion, allow a participant to

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satisfy a tax withholding requirement by, among other means, directing the Company to apply shares of the Company’s common stock to which the participant is entitled pursuant to the award to satisfy the withholding amount.

Federal Income Tax Information. The following is a brief summary of certain of the federal income tax consequences of certain transactions under the 2010 SIP based on current federal income tax laws, which are subject to change. This summary is not intended to be exhaustive and does not describe state, local or foreign income tax consequences that may be applicable. Participants in the 2010 SIP should consult their own professional tax advisors concerning tax aspects of rights under the 2010 SIP. Nothing in this proxy statement is written or intended to be used, and cannot be used, for the purposes of avoiding taxpayer penalties. Generally, with the exception of a stock grant award (which is vested at the time of grant) or a restricted stock award with respect to which a participant has timely filed an election under Section 83(b) of the Code, a participant will not recognize taxable income with respect to any award at the time of grant. A participant will recognize income on a stock grant award at the time of grant. If a participant who receives a restricted stock grant makes an election under Section 83(b) of the Code, the participant will recognize income on the award at the time of grant. Any gain or loss on the participant’s subsequent disposition of the shares will receive long-term or short-term capital gain or loss treatment, depending on whether the shares are held for more than one year following exercise. The Company does not receive a tax deduction for any such gain.

Upon exercise of a non-qualified stock option, the lapse of restrictions on restricted stock (with respect to which a Section 83(b) election was not filed), the issuance of shares or payment of cash upon exercise or disposition of SARs or the issuance, as applicable, of shares or cash upon settlement of RSUs, performance shares, performance share units or performance cash awards, the participant will recognize ordinary taxable income in an amount equal to the difference between the amount paid for the award or the shares issued, if any (or, in the case of an option, the exercise price) and the fair market value of the stock or amount received on the date of exercise, lapse of restriction or payment. Subject to potential deduction limitations under Section 162(m) and Section 280G of the Code, the Company will generally be entitled to a concurrent income tax deduction equal to the ordinary income recognized by the participant. Any gain or loss on the participant’s subsequent disposition of the shares of the Company’s common stock will receive long-term or short-term capital gain or loss treatment, depending on whether the shares are held for more than one year following exercise. The Company does not receive a tax deduction for any such gain.

A participant who is granted an incentive stock option generally will not recognize taxable income at the time of exercise. However, the excess of the stock’s fair market value over the option price could be subject to the alternative minimum tax in the year of exercise (assuming the stock received is not subject to a substantial risk of forfeiture or is transferable). If a participant sells or disposes of the stock acquired upon the exercise of an incentive stock option after the later of two years from the Grant Date or one year from the date of exercise, the gain or loss (in an amount equal to the difference between the sales price and the exercise price) upon disposition of the stock will be treated as a long-term capital gain or loss, and the Company will not be entitled to any income tax deduction. If the holding period requirements are not met, resulting in a disqualifying disposition, the incentive stock option will not meet the requirements for this tax-favored treatment. Instead, the participant would recognize ordinary income in the year of the disposition. The amount of such ordinary income generally is the lesser of: (i) the difference between the amount realized on the disposition and the exercise price; or (ii) the difference between the fair market value of the stock on the exercise date and the exercise price. Any gain in excess of the amount taxed as ordinary income would be treated as a long-term or short-term capital gain, depending on whether the stock was held for more than one year, and the Company would not receive a tax deduction for such gain. The Company, in the year of the disqualifying disposition, is generally entitled to a deduction equal to the amount of ordinary income recognized by the participant, subject to possible limitations imposed by Section 162(m) or Section 280G of the Code and so long as the Company appropriately reports such income, if required.

Recipients of stock-based awards that earn dividends (other than restricted stock awards with respect to which a Section 83(b) election has been made) or dividend equivalents will recognize taxable ordinary income on any dividend and dividend equivalent payments received with respect to such awards, which income is subject to withholding for U.S. federal income and employment tax purposes if the recipient of the award is an employee. The Company is generally entitled to an income tax deduction in the amount of the income recognized by a participant, subject to possible limitations imposed by Section 162(m) or Section 280G of the Code. Under Section 409A, the definition of deferred compensation arrangements potentially includes, among other forms of compensation, below-market option and SAR grants, as well as RSUs, performance shares, performance share units and performance cash awards. If awards that are subject to Section 409A fail to comply with Section 409A, a participant must include in ordinary income all deferred compensation, if any, conferred by the award, pay an additional 20% excise tax and, potentially, an additional interest penalty tax. The Company intends (but cannot and does not guarantee) that awards granted under the 2010 SIP will comply with the requirements of Section 409A or an exception thereto and intends to administer and interpret the 2010 SIP in such a manner. Under the net investment income

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Management Proposals

tax introduced under the Patient Protection and Affordable Care Act, dividends paid to and capital gains recognized by individuals with incomes over certain threshold amounts may be subject to an additional 3.8% tax on investment income.

Tax Consequences to the Company or Its Affiliates. To the extent that a participant recognizes ordinary income in the circumstances described above, the Company or the affiliate for which the participant performs services will generally be entitled to a corresponding deduction, subject to potential deduction limitations under Section 162(m) and Section 280G of the Code.

Grants under the 2010 SIP. Grants under the 2010 SIP are made in the discretion of the Committee (or the CEO, to the extent of any delegation as described above). Consequently, it is not possible to predict the future grants that will be made and benefits that will be received by participants pursuant to the 2010 SIP. The below table represents all equity awards granted under the 2010 SIP from adoption through the Proposal No. 5 Effective Date to the NEOs, current executive officers as a group, current Outside Directors as a group, all other current employees, including current officers who are not executive officers, as a group, each associate of any of such Directors, executive officers or nominees for Director and each other person who received or is to receive 5% of such options, warrants or rights. The below amounts do not include adjustments for full value awards as described under “Stock Subject to the 2010 SIP” above or canceled awards or forfeited shares due to performance awards not being earned. As of the Proposal No. 5 Effective Date, the closing price of the Company’s common stock on The Nasdaq Global Select Market LLC (“Nasdaq”) was $41.83.

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Required Vote

The affirmative vote of a majority of the votes duly cast is required to approve this Proposal No. 5. Abstentions and Broker non-votes are not treated as votes cast and therefore will have no effect on the outcome of this Proposal No. 5.

The Board of Directors recommends a vote “FOR” the approval of amendments to the ON Semiconductor Corporation Amended and Restated Stock Incentive Plan, as described in this Proposal No. 5.

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THE BOARD OF DIRECTORS AND CORPORATE GOVERNANCE

The Board met 11 times in 2020, and the committees, including any special committees, of the Board held a total of 30 meetings. Each incumbent Director serving during 2020 attended all Board and applicable committee meetings held during his or her period of service in 2020. We do not currently have a policy with regard to Directors’ attendance at annual meetings of stockholders. Due to public health concerns related to the novel coronavirus 2019 (“COVID-19”) pandemic, only two of our Directors serving during 2020 attended the annual meeting of stockholders held on May 20, 2020 (the “2020 Annual Meeting”).

Board Refreshment and Diversity

Director Refreshment Initiative

During the Board’s 2020 self-evaluation process, the Board determined that a refreshment initiative was necessary in order to restore the appropriate balance between the knowledge and understanding of our business that comes from longer-term service on the Board and the fresh ideas and perspective that can come from adding new members. During this process, the Board also considered the need for various forms of diversity, including age, professional background, gender, racial and ethnic diversity, and the tenure of certain Directors serving on our Board at that time. In connection with that initiative, four Outside Directors were appointed by the Board. As a result of these recent additions to the Board, and as further evidence of the Board’s commitment to director refreshment, the average board tenure for our Outside Directors was reduced by more than two years. Our Outside Directors who have been nominated for re-election to the Board have a balance of tenure (average tenure of 4 years), age (average age of 61 years) and racial, ethnic and gender diversity (33.3% of the Outside Directors) that provides our Board with an effective mix of experience and fresh perspective.

Diversity

We endeavor to have a board representing diverse experiences in areas that are relevant to the Company’s global activities. When the Corporate Governance and Nominating Committee considers diversity, as it did in connection with the Board’s 2020 refreshment initiative, it may consider diversity of experience, skills and viewpoints, as well as traditional diversity concepts, such as race, ethnicity or gender, as it deems appropriate. In particular, we value international business experience and, as such, our directorship mix reflects that emphasis. With respect to traditional diversity concepts, two of our Board members self-identify as Asian. The Board will continue to evaluate from time to time the addition to the Board of any Director candidate that may complement the knowledge, skills and experience possessed by the nominees for Director to ensure that the composition of the Board appropriately reflects changes in the Company’s evolving business.

Considerations for Independence Determinations

Independence Determination

The Board has determined that the following Directors serving on the Board during 2020 are independent according to the applicable rules of the SEC and the listing standards of Nasdaq: Atsushi Abe, Alan Campbell, Susan K. Carter, Curtis J. Crawford, Ph.D., Thomas L. Deitrich, Gilles Delfassy, Emmanuel T. Hernandez, Bruce E. Kiddoo, Paul A. Mascarenas, Daryl A. Ostrander, Ph.D., Teresa M. Ressel, Gregory L. Waters and Christine Y. Yan.

Transactions and Relationships Considered in Independence Determinations

Consistent with Nasdaq listing standards, in making its independence determinations, the Board considered transactions occurring since the beginning of 2018 between the Company and the Directors, members of their immediate families and entities associated with the Directors or members of their immediate families. The Board determined that no “categorical” bars to independence under Nasdaq listing standards applied to any of the Outside Directors. In making its determination that no relationships exist that, in the opinion of the Board, would impair the independence of any of the Outside Directors, the Board considered the associations certain of our Outside Directors have with other companies, including other companies in the semiconductor industry, as disclosed in their biographies and discussed further below. In each applicable instance, the amounts paid to and/or received from each organization (and ON Semiconductor) were below the 5% of consolidated revenue of the recipient entity threshold set forth in Nasdaq listing standards. The following table contains the transactions occurring since January 1, 2018 that the Board considered in determining the independence of the current Outside Directors, each of whom is a nominee for Director:

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The Board of Directors and Corporate Governance

The following table contains the transactions occurring since January 1, 2018 that the Board considered in determining the independence of former Directors, each of whom served as a Director during a portion of the 2020 fiscal year:

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The Board of Directors and Corporate Governance

Committees of the Board

Our Board standing committees and membership, effective as of April 3, 2021, are as follows:

Audit Committee

The Audit Committee, established pursuant to Section 3(a)(58)(A) of the Exchange Act, has a formal written charter, a copy of which is available on our website at www.onsemi.com. The adequacy of this charter is reviewed at least annually. Our Audit Committee has the specific purpose under its charter to:

Among other things, the Audit Committee has the specific authority and responsibility under its charter to:

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The Audit Committee has other specific responsibilities under its charter, including with respect to the pre-approval of auditing services and permitted non-audit services (including the fees and terms thereof) of our independent registered public accounting firm. As provided in its charter, the Audit Committee also has authority over and responsibility for various other financial statement and disclosure matters, other items associated with the Company’s independent registered public accounting firm and additional events associated with the Company’s internal audit and compliance functions. In addition, the Audit Committee conducts an annual self-assessment. The Audit Committee regularly meets with the Company’s independent registered public accounting firm and, to the extent it deems necessary or appropriate, may retain independent legal, accounting or other advisors with appropriate funding related thereto to be provided by the Company. See also “Audit Committee Report” below for more information on the Audit Committee. The Audit Committee met 10 times in 2020.

The Board has determined that each member of the Audit Committee during 2020 and each current member of the Audit Committee is independent within the meaning of applicable SEC rules and Nasdaq listing standards and that each current member of the Audit Committee is financially competent under the current Nasdaq listing standards. The Board has also determined that Alan Campbell, Susan K. Carter and Bruce E. Kiddoo, all of whom are independent members of the Audit Committee, meet the qualifications of an “audit committee financial expert” in accordance with SEC rules and similar financial sophistication rules under Nasdaq listing standards.

Compensation Committee

The Compensation Committee has a formal written charter, a copy of which is available on our website at www.onsemi.com. The adequacy of this charter is reviewed at least annually. Among other things, our Compensation Committee has the specific purpose under its charter to:

Among other things, our Compensation Committee has the specific authority and responsibility under its charter to:

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The Board of Directors and Corporate Governance

Pursuant to its charter, the Compensation Committee also prepares a report required by SEC rules for inclusion in our proxy statement. This report is included in this proxy statement immediately following the CD&A.

The Compensation Committee generally may delegate authority to subcommittees and others, as appropriate, subject to any limitations set forth in its charter and other applicable governance documents. The 2010 SIP, together with the Delegated Authority Guidelines, contemplate that pursuant to a specific written delegation of authority by the Compensation Committee, the CEO may grant awards to certain employees of the Company (other than Directors and “Senior Officers” (as defined in the Delegated Authority Guidelines)) to expedite the hiring process and retain talented employees. We describe the role of executive officers in determining or recommending the amount or form of executive compensation in the CD&A under “Processes and Procedures for Considering and Determining Executive Compensation — Role of Senior Executives in Determining Executive Compensation.” The role that officers play in determining or recommending the amount or form of director compensation is generally consistent with that description.

The Compensation Committee has regularly and directly engaged a compensation consultant to assist in recommending the form and amount of executive and director compensation. In May 2012, the Compensation Committee engaged Pearl Meyer & Partners, LLC (“Pearl Meyer”) as its primary compensation consultant. The Compensation Committee has reviewed the performance of Pearl Meyer annually since that date, and continues to engage Pearl Meyer as its primary compensation consultant. Among other things, with respect to our 2020 compensation programs, Pearl Meyer was requested to:

After considering the independence of Pearl Meyer in light of SEC rules and Nasdaq listing standards regarding compensation consultants, the Compensation Committee concluded that Pearl Meyer’s work for the Compensation Committee has not raised any conflict of interest.

The Board has determined that each member of the Compensation Committee during 2020 and each current member of the Compensation Committee is independent within the meaning of applicable SEC rules and Nasdaq listing standards. The Compensation Committee met eight times in 2020.

Corporate Governance and Nominating Committee

The Corporate Governance and Nominating Committee has a formal written charter, a copy of which is available on our website at www.onsemi.com. The adequacy of this charter is reviewed at least annually. Our Corporate Governance and Nominating Committee has the specific purpose under its charter to:

Among other things, our Corporate Governance and Nominating Committee has the specific responsibility under its charter to:

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The Corporate Governance and Nominating Committee is required to develop and periodically review criteria for nominees for Director, which may include specific skills, experience, diversity and other qualifications. Among other matters, the Corporate Governance and Nominating Committee may consider the following nomination criteria regarding Board membership:

The Company’s goal is to assemble a Board that brings together a variety of perspectives and skills derived from high-quality business and professional experiences. Directors must be willing to devote sufficient time to carrying out their duties and responsibilities effectively, and should be committed to serve on the Board for an extended period of time. The Corporate Governance and Nominating Committee believes that it is appropriate for more than one member of the Board to meet the criteria for an “audit committee financial expert,” as defined by SEC rules, and for the CEO to participate as a member of the Board. Current members of the Board with skills and experience that are relevant to the Company’s business and who are willing to continue in service are considered for re-nomination. If any member of the Board does not wish to continue in service, if the Corporate Governance and Nominating Committee decides not to re-nominate a member for re-election or determines to replace that Director or if the Board considers increasing the size of the Board, the Board then identifies the desired skills and experience for a new nominee in light of the criteria above. Pursuant to its charter, if a stockholder complies with the Director nomination procedures described in the Bylaws, the Corporate Governance and Nominating Committee will consider that nomination. In such case, it will evaluate the stockholder nomination in the same manner as it evaluates other nominees.

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The Board of Directors and Corporate Governance

The Corporate Governance and Nominating Committee may engage in research to identify qualified individuals, which may include engaging a professional search firm from time to time. In 2020, the Corporate Governance and Nominating Committee engaged in various search processes, resulting in the identification of Mr. Deitrich, Ms. Carter, Mr. Kiddoo and Mr. Waters. After careful consideration of their credentials and qualifications, the Board, upon recommendation from the Corporate Governance and Nominating Committee, elected each of Mr. Deitrich, Ms. Carter, Mr. Kiddoo and Mr. Waters to the Board on October 5, 2020, October 28, 2020, December 16, 2020 and December 16, 2020, respectively, to serve until the Annual Meeting and until their successors are duly elected and qualified.

On August 31, 2020, Keith D. Jackson, our former President, CEO and Director, informed the Board of his intention to retire from the Company and the Board. The Corporate Governance and Nominating Committee subsequently engaged a third party executive search firm to lead a search for a new CEO. Following a careful review of qualified candidates presented by the executive search firm, the Board, upon recommendation from the Corporate Governance and Nominating Committee, approved the appointment of Hassane S. El-Khoury as President and CEO of the Company, and as a member of the Board and the Executive Committee of the Board (the “Executive Committee”), in each case, effective December 7, 2020. Mr. Jackson stepped down as President, CEO and Director effective as of December 7, 2020, and will continue to serve as an advisor to the Company until his retirement on May 31, 2021.

The Board has determined that each member of the Corporate Governance and Nominating Committee during 2020 and each current member is independent within the meaning of applicable SEC rules and Nasdaq listing standards. The Corporate Governance and Nominating Committee met seven times in 2020.

Executive Committee

The Executive Committee has a formal written charter, a copy of which is available on our website at www.onsemi.com. The Executive Committee has the specific purpose under its charter to exercise between meetings of the Board all the delegable powers and authority of the Board regarding the management of the business and affairs of the Company to the extent not expressly prohibited and not separately delegated to other committees of the Board, and subject to applicable restrictions and limitations.

As set forth in its charter, the Executive Committee does not have the power, among other things, to:

The Executive Committee met one time in 2020.

Science and Technology Committee

The Science and Technology Committee of the Board (the “Science and Technology Committee”) has a formal written charter. The adequacy of this charter is reviewed at least annually. Our Science and Technology Committee has the specific purpose under its charter to advise the Board as to the scope, health, direction, quality, investment levels and execution of the Company’s technology and innovation strategies. Among other things, our Science and Technology Committee has the specific responsibility under its charter to:

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The Science and Technology Committee is required to convene at least two times each year, with additional meetings as deemed appropriate by the Science and Technology Committee or its Chair. It has the authority to retain such outside advisors, including legal counsel or other experts, as it deems appropriate and to approve the fees and expenses of such advisors. The Science and Technology Committee met four times in 2020.

Other Committees

The Board, from time to time, has deemed it desirable and in the best interest of the Company to form various special committees and other independent committees.

Annual Board and Committee Self-Evaluations

The Board believes that having good governance principles and practices improves the effectiveness of the Board and correlates to the creation of stockholder value. To measure its own operation against such principles and practices and to identify and act on areas for improvement, each of the Board and its committees performs an annual self-evaluation. The Corporate Governance and Nominating Committee is charged with overseeing the self-evaluations, and in 2020, the Corporate Governance and Nominating Committee used the following process to conduct the Board’s self-evaluation:

In the Board self-evaluation process, topics and questions for 2020 were grouped into seven categories:

The Corporate Governance and Nominating Committee and the Board reconsider the tools, processes, topics and questions for the self-evaluation as warranted, including consideration of whether to retain an independent third party to facilitate the Board’s self-evaluation. The Board and its committees may perform the annual self-evaluations using different tools and processes in future years. In 2020, the self-evaluation of the committees generally followed the process used by the Board, except that results were sent to committee chairs (as opposed to the Chair of the Corporate Governance and Nominating Committee), and committee chairs led the discussions for their respective committees with the Board in executive session.

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Annual Director Peer Evaluations

We believe that each of our Directors can and do benefit from candid feedback received from other Board members about his or her individual performance. Accordingly, we conduct annual peer evaluations to obtain information about each Director’s performance, contributions and effectiveness. These Director peer evaluations are critical tools that promote more authentic board collaboration, improve the skills and perspectives of our Directors and allow them to receive guidance from esteemed colleagues.

2020 Compensation of Directors

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Discussion of Director Compensation

The Compensation Committee regularly reviews the compensation payable to Outside Directors. In reviewing Board compensation practices, the Compensation Committee is advised by its outside consultants from time to time. In May 2020, Pearl Meyer provided the Compensation Committee with an analysis of Outside Director compensation, including a review of director compensation of the Company’s peer group (the “Pearl Meyer Director Compensation Report”). The peer group for this analysis consisted of the same comparator group that is used to evaluate executive compensation. Based on the Pearl Meyer Director Compensation Report and the recommendations therein, in May 2020, the Compensation Committee adopted the 2020 compensation program for our Outside Directors (the “Outside Director Compensation Program”). Under the Outside Director Compensation Program, which is described below, there were no year-over-year increases to Outside Director compensation, and temporary measures were taken to mitigate the impact of the COVID-19 pandemic on the Company’s 2020 financial performance.

Retainers and Temporary Fee Reduction — COVID-19

As part of the Company’s action plan in response to the COVID-19 pandemic, and similar to the approach taken with respect to 2020 compensation for the Company’s executive officers (including the NEOs), the Board reduced the cash retainer paid to Outside Directors for their service on the Board during the third quarter of 2020 from $17,500 to $14,875 (a reduction of 15%). Except as noted above, the annual cash retainers under the Outside Director Compensation Program remained consistent with the retainers paid during the previous year, and were as follows:

Annual cash retainers are generally paid quarterly in arrears, except that the retainers for the fourth quarter are typically paid before the year-end.

Equity Compensation

Under the Outside Director Compensation Program, each Outside Director receives an annual award of fully-vested stock with a value equal to approximately $205,000, rounded up such that only whole shares are issued. The 2020 annual award for Outside Directors was granted on June 1, 2020, and the amount of such award was based on the closing price of our stock on the grant date ($16.78). Each Outside Director serving on the Board on the grant date therefore received an annual stock award of 12,217 shares. The 2020 grants were made under the 2010 SIP. Under the Outside Director Compensation Program, if an Outside Director is appointed after the date of the annual grant, the award amount is prorated based on the period of the year during which the Outside Director serves.

Other

We reimburse Outside Directors for reasonable expenses incurred to attend Board and committee meetings and to perform other relevant Board duties. Employee Directors do not receive any additional compensation for their services as members of the Board.

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Majority Voting for Directors

Except as otherwise provided in the Bylaws, each Director is elected by a majority of the votes cast with respect to that Director’s election at any meeting for the election of Directors at which a quorum is present. A majority of votes cast means that the number of votes cast “FOR” a Director’s election exceeds the number of votes cast “AGAINST” that Director’s election (with abstentions and Broker non-votes not counted as votes cast either “FOR” or “AGAINST” that Director’s election). However, if, as of the tenth day preceding the date we first deliver the notice of such meeting to our stockholders, the number of nominees exceeds the number of Directors to be elected (a “Contested Election”), the Directors will be elected by the vote of a plurality of the votes cast. A plurality of votes cast means that the number of votes cast “FOR” a Director’s election, while less than a majority, nonetheless exceeds the number of votes cast “FOR” any other Director.

In the event an incumbent Director fails to receive a majority of the votes cast in an election that is not a Contested Election, the incumbent Director must promptly tender his or her resignation to the Board. The Corporate Governance and Nominating Committee, or such other committee designated by the Board for this purpose, will make a recommendation to the Board as to whether to accept or reject the resignation of such incumbent Director, or whether other action should be taken. The Board must act on the resignation, taking into account such committee’s recommendation, and publicly disclose (by a press release and filing an appropriate disclosure with the SEC) its decision regarding the resignation and, if such resignation is rejected, the rationale behind the decision, within 90 days following certification of the election results. The Corporate Governance and Nominating Committee in making its recommendation, and the Board in making its decision, each may consider any factors and other information that it considers appropriate.

If the Board accepts a Director’s resignation pursuant to these provisions, or if a nominee for Director is not elected and the nominee is not an incumbent Director, then the resulting vacancy may be filled by vote of a majority of the Directors then in office pursuant to Article NINTH, Section 2 of our Certificate of Incorporation.

Other Board Matters

Board Leadership Structure

We currently separate the roles of CEO and Chair of the Board to align the Chair role with our Outside Directors and to further enhance the independence of the Board from management. Our Chair works closely with our CEO and General Counsel to set the agendas for meetings, facilitate information flow between the Board and management and gain the benefit of the CEO’s Company-specific experience, knowledge and expertise.

The Board’s Role in Risk Oversight

While management is responsible for the day-to-day management of the Company’s risk, the Board plays an ongoing and active role in the oversight of such risk by regularly reviewing and discussing with management areas of material risk to the Company and mitigation measures being taken to address such risks. While the Board has primary responsibility for risk oversight, the Board’s committees support the Board by regularly addressing risks in their respective areas of oversight. Specifically, the Audit Committee’s charter requires the Audit Committee to discuss with management the Company’s major financial risk exposures. The Corporate Governance and Nominating Committee’s charter requires it to oversee the ERM Program and provide guidance to the Board regarding its risk oversight responsibilities. The Compensation Committee’s charter requires it to consider and discuss with management whether compensation arrangements for Company employees incentivize unnecessary and excessive risk-taking, and in designing our compensation programs and structuring awards, the Compensation Committee considers the likelihood of undue risk-taking and the impact that such compensation decisions may have on the Company’s risk profile. The charter for the Science and Technology Committee also requires it to review the Company’s risk exposure relating to its respective function. The chair of the relevant committee then reports on risk discussions to the full Board to the extent appropriate. This dual track of direct Board oversight and oversight through its committees is designed to foster a fulsome discussion of risks facing the Company. The Board’s role in risk oversight has not affected its leadership structure.

Periodic Risk Evaluations. As part of its review of the Company’s material areas of risk, the Board meets three times per year to discuss strategy and planning meetings at which business plans and proposals for the Company and various units or groups within the Company are presented and discussed. Business unit leaders and the heads of certain administrative function groups provide annual and mid-year status reports to the Board. These reports include risk evaluation and assessment as a matter of course. At least annually, the Board reviews how risk is being managed and reported to the Board and its committees, along with areas where the Board would like additional analysis or discussion. Comprehensive risk analysis is a significant part of such planning.

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Information Security Risk Management. Management and the Board consider and evaluate from time to time the risk of cybersecurity breaches and vulnerabilities and how best to mitigate such risks. For example, under ON Semiconductor’s Insider Trading Policy (the “Insider Trading Policy”), the Company’s Securities Compliance Officer may impose a black-out on securities trading in the event of a cybersecurity breach or attack. Under such circumstances, as a further measure to promote compliance with the trading black-out, the Insider Trading Policy also imposes a duty upon the Securities Compliance Officer to notify the CEO and our Chief Financial Officer (the “CFO”) of the black-out at or before the time it is imposed. Additionally, the Audit Committee receives regular reports from our Corporate Internal Audit Department on internal audit matters and receives reports at least annually from our CIO and Chief Information Security Officer on information security and data privacy and protection. The Science and Technology Committee also receives reports from the CIO at least annually with respect to the Company’s information technology planning, penetration testing plans and cybersecurity. Other specific risks are also addressed appropriately as and when they are identified.

The Board’s Role in Diversity and Inclusion Oversight

The Company’s mission to be a leader in semiconductor-based solutions and empower customers to reduce global energy use is supported by a strong company culture focused on welcoming diversity of opinion and celebrating stakeholders from all walks of life. Pursuant to its charter, the Corporate Governance and Nominating Committee has the responsibility of reviewing and overseeing matters related to CSR, which include Company initiatives related to diversity and inclusion. Additionally, the Compensation Committee considers diversity and inclusion in its broader review of pay equity within the Company and, in 2020 and previous years, elected to use the achievement of a specified level of diversity within the Company’s workforce as a performance measure for the compensation of NEOs under the Company’s short-term incentive compensation program.

Stockholder Rights Plan

On June 7, 2020, in response to volatility in the marketplace as a result of the COVID-19 pandemic, the Board adopted a short-term stockholder rights plan (the “Rights Plan”) and declared a dividend of one preferred share purchase right for each share of common stock outstanding on June 18, 2020. The Rights Plan is designed to protect stockholder interests by reducing the likelihood that any person or group would gain control of the Company through the open-market accumulation of ON Semiconductor shares without appropriately compensating ON’s stockholders for such control. The Rights Plan is set to expire on June 7, 2021, but the Board may consider an earlier termination of the Rights Plan if market and other conditions warrant. The Board does not have an intention at the current time of renewing the Rights Plan. If the Board makes a determination to renew the Rights Plan at a later date, the Board would expect to, absent any material development or change in circumstances that would make the taking of prompt action by the Board to protect the Company and its stockholders necessary or advisable, submit such renewal (or any other stockholder rights plan to be adopted in the near term) to a stockholder vote.

Corporate Governance Principles

Our Corporate Governance Principles (the “Principles”) provide guidance for a variety of corporate governance matters and are available on our website at www.onsemi.com. The Corporate Governance and Nominating Committee reviews the Principles annually and recommends amendments to the Board, as appropriate. Below is a summary of certain of our corporate governance practices, many of which are addressed in the Principles and our Bylaws:

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The Role of the Board and Management

Our business is conducted by our employees and officers, under the direction of the CEO and the oversight of the Board, to enhance the long-term value of the Company for its stockholders. Both our Board and management recognize that the long-term interests of stockholders are advanced by responsibly addressing the concerns of other stakeholders and interested parties, including employees, recruits, customers, suppliers, creditors, ON Semiconductor communities, government officials and the public at large.

Functions of the Board

The Board has at least four regularly scheduled meetings per year at which it reviews and discusses reports by management on our performance, plans and prospects and immediate issues facing the Company. The Board may choose to schedule additional meetings in accordance with our Bylaws. In addition to general oversight of management, the Board, acting directly or through its various committees, also performs specific functions, including, among other things: (i) selecting, evaluating and compensating the CEO and other senior executives and overseeing CEO succession planning; (ii) reviewing, monitoring and, where appropriate, approving fundamental financial and business strategies and major corporate actions; (iii) providing oversight for the ERM Program, including the establishment of corporate risk appetite parameters and management’s implementation of processes for assessing and managing risks affecting the Company; (iv) ensuring that processes are in place for maintaining the integrity of the Company, financial statements, compliance with law and ethics, relationships with customers and suppliers and relationships with other stakeholders; and (v) performing such other functions as are prescribed by law or our Bylaws.

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Qualifications

Directors should possess the highest personal and professional ethics, integrity and values, and be committed to serving on the Board for an extended period of time. They must also have an inquisitive and objective perspective, practical wisdom and mature judgment. We endeavor to have a Board representing diverse experiences in areas that are relevant to the Company’s global activities and strategies in order to guide the Company in meeting its legal, financial and operational objectives.

Independence of Directors

We will have, at a minimum, a sufficient number of independent Directors to comply at all times with relevant and applicable SEC, Nasdaq and other rules and regulations.

Compensation of the Board

The Board has delegated responsibility for determining Outside Director compensation to the Compensation Committee, and such responsibility is codified in the Compensation Committee’s charter. In determining compensation and benefits for our Directors, the Compensation Committee is guided by three goals: (i) to fairly pay Outside Directors for work required in a public company of our size and scope; (ii) to align Outside Directors’ interests with the long-term interests of our stockholders; and (iii) to structure the compensation in a way that is simple, transparent and easy for our stockholders to understand. Generally, the Compensation Committee believes that these goals are served by compensating Outside Directors with a balance of cash and equity-based awards.

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The Board of Directors and Corporate Governance

Directors’ and Officers’ Stock Ownership and Retention Guidelines

In order to align Directors’ and officers’ interests and objectives with those of our stockholders, and to further promote the Company’s longstanding commitment to sound corporate governance, the Company has established the following guidelines for Company stock ownership and retention:

If compliance would create a severe hardship or for other good reasons, these guidelines may be waived for: (i) Outside Directors other than the Chair of the Board, at the discretion of the Chair of the Board; and (ii) the Chair of the Board and officers, at the discretion of the Compensation Committee. It is expected that these instances will be rare.

Other Matters

The Principles include a discussion of Board size and selection, the determination of the Board agenda, the process available for reporting concerns to the Audit Committee relating to our accounting, internal accounting controls or auditing matters, access to senior management and independent advisors and other matters typical of boards of directors of other publicly-traded semiconductor or peer companies.

Ethics and Corporate Social Responsibility

We are committed to having and maintaining strong and effective global ethics and CSR programs. In 2021, for the sixth consecutive year, the Company was named a World’s Most Ethical Company^® by the Ethisphere Institute, a global leader in defining and advancing the standards of ethical business practices. The designation recognizes organizations that align principle with action by working tirelessly to make integrity part of their corporate DNA. These efforts shape future industry

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standards by introducing tomorrow’s best practices today. The Company was one of only three companies honored in the semiconductor industry in 2021, highlighting its leadership among global companies in ethical business standards and practices. The Corporate Governance and Nominating Committee has the responsibility under its charter to review and oversee matters related to ethics and CSR.

Ethics Program

We always strive to comply with the law, and have adopted policies and practices that go beyond what the law requires in order to foster an ethical culture. To that end, we have established an ethics program (the “Ethics Program”) designed to prevent, detect and respond to violations of the ON Semiconductor Corporation Code of Business Conduct (the “Code of Business Conduct”) and related policies and procedures, other standards of conduct and the law. A major goal of the Ethics Program is to promote an organizational culture that encourages ethical conduct and a commitment to compliance.

We have also established avenues for parties external to the Company to raise ethics and compliance concerns regarding our employees, Directors and third parties doing business with the Company directly to the Vice President, Ethics and Corporate Social Responsibility or our Chief Compliance Officer. Reports may be made anonymously where allowed by local law (or on a non-anonymous basis) by:

Corporate Social Responsibility

In addition to the information contained in this proxy statement, an annual report detailing our CSR initiatives, accomplishments and objectives is available on our website at www.onsemi.com. Below are a few of the highlights of our CSR practices and policies:

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The Board of Directors and Corporate Governance

Code of Business Conduct

We have adopted a Code of Business Conduct that is applicable to all of our Directors, officers and employees, and we believe the Code of Business Conduct satisfies the standards promulgated by the SEC and Nasdaq. The Code of Business Conduct is available free of charge on our website at www.onsemi.com, or a paper copy is available upon request by writing to our Investor Relations Department, ON Semiconductor Corporation, 5005 East McDowell Road, Phoenix, Arizona 85008, calling our Investor Relations Department at (602) 244-3437 or emailing your request to investor@onsemi.com.

Legal Compliance

Working closely with the Internal Audit Department and Ethics and CSR Department, the Law Department implements and manages legal compliance programs designed to prevent and detect violations of the Code of Business Conduct, related standards of conduct and the law by employees or third parties. Allegations of non-compliance with laws or regulations are thoroughly investigated and remediated, as appropriate.

Our Audit Committee has compliance oversight responsibility, including obtaining reports from the Internal Audit Department and the Law Department regarding any known material non-compliance with the law, advising the Board with respect to the Company’s legal compliance policies and procedures and discussing with the Law Department potentially material legal matters, including material inquiries received from regulators or government agencies. For more information on the Board’s oversight responsibilities, including its responsibility to oversee risk and our ERM Program, see the “The Board of Directors and Corporate Governance — Other Board Matters — The Board’s Role in Risk Oversight.”

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COMPENSATION DISCUSSION AND ANALYSIS

Overview

This CD&A contains material information about our compensation objectives and policies and explains the material elements of the disclosures that are contained in this proxy statement with respect to the compensation of our NEOs. For 2020, our NEOs were: