AD Integrated Report 2023-24

LETTER FROM OUR PRESIDENT & CEO Deon Stander

Fellow Stakeholders,

Our team at Avery Dennison displayed tremendous agility throughout 2023 amid a dynamic business climate. While market conditions turned out to be very different than we initially anticipated and we did not meet our initial expectations for the full year, I am pleased with how we navigated the challenging environment. Importantly, we made solid progress toward our long-term strategic priorities, expanded our Intelligent Label platform and advanced our sustainability efforts, leveraging our strong materials science foundation and digital identification innovations to deliver for all stakeholders.

Building on our business strengths

The primary industries we serve experienced significant inventory destocking in 2023. In response to lower volume, we effectively made adjustments, protected margins and carefully managed costs while deepening our insights on the drivers of demand and inventory throughout our value chain. Our Materials Group delivered strong margins, with volume improving sequentially each quarter, and our Solutions Group sales increase reflected strong growth in high-value categories, particularly Intelligent Labels, as well as the impact of acquisitions. We are well positioned to deliver strong earnings growth in 2024 while making significant progress toward delivering our long-term sustainability and financial targets. As industry leaders in our primary businesses with competitive advantages in scale and innovation, we continue to provide service excellence and create value for our customers across the globe.

Evolving our strategies

As our business continued to evolve, we refined our strategies to further concentrate on the key areas that will enable our success over the long term. Our core set of strategies now includes leading at the intersection of the physical and digital — an important differentiator as our customers increasingly look for help in solving

complex industry challenges, such as labor efficiency and supply chain effectiveness, waste reduction, circularity and transparency, and better connecting brands and consumers. In our ever more connected world, the potential to solve these challenges rests on the ability for physical items to have a digital identity. Avery Dennison is uniquely positioned to connect the physical and digital, leveraging the core capabilities of our Materials and Solutions businesses while further delivering marketdriven innovation, as demonstrated by the power of our Intelligent Labels platform.

Accelerating growth in high-value categories

Our Intelligent Labels platform is now a roughly $850 million business that has averaged nearly 20% growth on an organic basis for many years. In 2023, we increased our potential in this space as programs ramped up and adoption in new categories, like logistics and food, accelerated. In 2023, our teams successfully executed the largest single wave program in RFID history in support of a global logistics service provider. Our customers continue to recognize the significant benefits of our Intelligent Labels technologies and solutions, from increasing supply chain and inventory visibility to enhancing the experience of their end consumers. Another one of our high-value categories, external embellishments, was bolstered by multiple strategic acquisitions in 2023 that added complementary capabilities to our Embelex portfolio and provided greater market access. With the vast opportunity available in high-value categories, we continue to invest and increase our capacity to grow in this area.

Advancing sustainability for our people and planet

Working toward a fully sustainable future while supporting the communities in which we operate is critical to the long-term health of our business strategy and culture. We use our resources, operational experience and creativity to drive better outcomes for our industries,

customers, team and world. Last year, we made further progress reducing our environmental footprint, expanding our portfolio of sustainability-oriented products, and advancing our diversity, equity and inclusion efforts. I am proud to say we are on track to achieving our 2025 sustainability goals and have accelerated our plans to deliver our 2030 goals.

In the area of corporate social responsibility, the Avery Dennison Foundation through its grantmaking and relief efforts supported critical community needs worldwide, including increasing education access, advancing environmental sustainability and supporting secure livelihoods.

Creating value and expanding our potential

Entering 2024, we are confident in our ability to execute our core business strategies, deliver significant earnings growth, and make substantial progress toward our long-term goals.

Given the diversity of our end markets, as well as the clear competitive advantages in both of our businesses and our talented and resilient team, we are in a strong position to expand our potential and continue unlocking significant growth opportunities. Most promising, the important role we play in addressing our industries’ and customers’ most pressing problems enables us to create even greater value for our stakeholders, making a brighter, more connected future possible.

Thank you to our entire Avery Dennison team for their passion and commitment and to you for your interest in Avery Dennison.

ABOUT THIS REPORT

This integrated report summarizes how we performed strategically and financially for the fiscal year ending December 30, 2023. It includes our 2023 annual report and our 2024 notice and proxy statement and highlights our progress toward the 2025 sustainability goals we established in 2015 and the 2030 goals and targets we established in 2020 and announced in 2021. Sustainability data have not been audited. Our policies on climate, human rights and water are publicly available on our website at esg.averydennison.com

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2023

2024

SECTION I

Our Company

We are a global materials science and digital identification solutions company that provides a wide range of branding and information solutions that optimize labor and supply chain efficiency, reduce waste, advance sustainability, circularity and transparency, and better connect brands and consumers.

Our products and solutions include labeling and functional materials, radio frequency identification (RFID) inlays and tags, software applications that connect the physical and digital, and a variety of products and solutions that enhance branded packaging and carry or display information that improves the customer experience. We serve an array of industries worldwide, including home and personal care, apparel, general retail, e-commerce, logistics, food and grocery, pharmaceuticals and automotive.

We comprise two business groups.

Materials Group

Our Materials Group is an industry-leading provider to the pressuresensitive label and graphics industries worldwide. Our innovative products include label materials, graphics and reflective materials, and functional bonding materials, such as tapes. Our label materials enhance shelf appeal for brands, inform shoppers, advance circularity, increase transparency, help reduce waste and improve operational supply chain efficiency. Our graphics portfolio offers highly engineered products that range from vehicle wraps to architectural films.

Materials Group plays a key role in advancing our fast-growing Intelligent Labels platform, providing the materials science capabilities and process engineering expertise that are essential to developing and manufacturing Intelligent Labels at scale.

Solutions Group

Our Solutions Group is an industry-leading global provider of information and branding solutions. Our solutions cover a breadth of customer needs from digital identification and data management, branding and embellishment, as well as productivity, pricing and retail media. We empower customers across multiple retail and industry segments to connect the physical and digital, leveraging our market-leading RFID solutions. Our technology addresses complex industry challenges, provides transparency and visibility across supply chains, improves labor and waste efficiency, and enables better consumer experiences at the point of purchase and beyond. Market segments served include the global apparel, logistics, food and grocery, and general retail industries.

As the world’s largest ultra-high frequency RFID solutions provider, we leverage our innovation and data management capabilities, global footprint and market access in the ongoing advancement of our Intelligent Labels platform.

OUR VALUES

Our culture is the foundation of everything we do, and our company values are the basis of that culture

These core values shape our behavior and support our business and people as we continue to grow.

OUR STAKEHOLDERS

Customers

We provide innovative, high-quality products and solutions, with industry-leading service.

Employees

We cultivate a diverse, engaged, safe and healthy workforce.

Communities

We are responsible stewards of the environment and a force for good in our communities

Investors

We are committed to delivering superior shareholder returns over the long term

Integrity

We are driven by doing the right thing Always.

Sustainability

We are focused on the long-term health of our business, planet and communities.

Courage

We are brave in the face of adversity and the unknown.

Innovation

We use imagination and intellect to create new possibilities

External Focus

We get out to get better

Teamwork

We are better when we work together and put others ahead of ourselves.

Diversity

We gain strength from diverse ideas and inclusive teams.

Excellence

We expect the best from ourselves and each other.

OUR BUSINESS STRATEGIES

We have a clear set of strategies to enable our long-term success over a wide range of business cycles. Our materials science foundation and Intelligent Labels platform uniquely position us to connect the physical and digital to address some of the most complex problems facing our industries and customers.

In 2023, we evolved our established long-term strategies and added a vital new one that reflects our growing Materials and Solutions connected capabilities.

Drive outsized growth in high-value categories through market-driven innovation

Grow profitably in our base business

Lead at the intersection of the physical and digital*

Effectively allocate capital and relentlessly focus on productivity

Lead in an environmentally and socially responsible manner

We remain confident that our strategies will continue to generate superior value for all stakeholders through a balance of GDP+ growth and top-quartile returns over the long term.

1

FINANCIAL HIGHLIGHTS

Following a challenging 2023, we expect progress toward our long-term targets in 2024 as label and apparel markets rebound and Intelligent Labels growth accelerates.

SUSTAINABILITY HIGHLIGHTS

We employ strategic practices in our approach to sustainability to manage how our products affect the environment upstream and downstream and determine how we can mitigate the impact of our operational footprint. Our innovation platforms focus on material circularity and waste reduction and elimination, which are fundamental to our stated ambition of delivering products and solutions that advance the circular economy We annually report our scope 3 greenhouse gas (GHG)

Progress Toward 2025 Goals

70% of revenues from sustainability-driven products

emissions through CDP, and in 2023, we made steady progress engaging suppliers, and moving toward materials-based and supplier-specific emissions factors.

We continue to make excellent progress toward our 2025 and 2030 sustainability goals and, in doing so, we continue to create long-term value for our stakeholders. Our March 2024 ESG Download is available on investors.averydennison.com and esg.averydennison.com.

3% absolute GHG reduction every year (26% cumulative by 2025)*

100% certified paper

70% Forest Stewardship Council (FSC)-certified face paper

95% landfill-free

75% waste recycled

70% of films we buy conform to, or enable end products to conform to, our environmental and social guiding principles

70% of chemicals we buy conform to, or enable end products to conform to, our environmental and social guiding principles

45% FSC-certified

90% landfill-free 55% recycled

67% Materials Group (Label and Graphics Materials only)

64% Solutions Group (Apparel Solutions only)

63% cumulative GHG emissions reduction*

96% certified

79% FSC-certified

93% landfill-free* 64% recycled*

97% of films

96% of chemicals

Publicly commit to goals/report progress

*As of Q3 2023. Full-year results available in Q3 2024.

1 In 2023, we utilized a new partner, process and platform, and more than doubled the questions asked. As such, 2023 reflects a new baseline from which we will measure progress ongoing.

Continued enhancing sustainability transparency with more comprehensive reporting

Progress Toward 2030 Goals

Goal 1: Deliver innovations that advance the circular economy

Satisfy the recycling, composting or reuse requirements of all single-use consumer packaging and apparel with our products and solutions.

Solutions Group: 100% of our core product categories (printed fabric labels, woven labels, paper, interior heat-transfer labels, packaging and RFID) will meet our Sustainable ADvantage Standard.

Materials Group: 100% of our standard label products will contain recycled or renewable content. All of our regions will have labels that enable circularity of plastics.

Goal 2: Reduce our environmental impact in our operations and supply chain

Reduce our scope 1 and 2 GHG emissions by 70% from our 2015 baseline. Work with our supply chain to reduce our 2018 baseline scope 3 GHG emissions by 30%2, with an ambition of net zero by 2050.

63% scope 1 and 2*

Prior year scope 3 calculations are available in our most recent CDP Climate Response

Source 100% of paper fiber from certified sources focused on a deforestation-free future. 45% FSC-certified 96% certified

84% landfill-free

89% landfill-free*1

Deliver a 15% increase in water efficiency at our sites that are located in high or extremely high risk countries as identified in the World Resources Institute ( WRI) Aqueduct Tool

9%*

Goal 3: Make a positive social impact by enhancing the livelihood of our people and communities

Foster an engaged team and an inclusive workplace.

• Inclusion Index: 85%

• Employee Engagement: 82%

• Females in manager level or above positions: 40%

Support the participation of our employees in Avery Dennison Foundation grants and foster the well-being of the communities in which we and our supply chain operate.

*As of Q3 2023. Full year results available in Q3 2024.

80% 32% 0.31 RIR 76%3 80%3 36% 0.22 RIR

Made ADF grants in 72% of countries in which we operate

95% incorporated employee volunteerism

1 We have changed our calculation methodology to more closely align with our 2030 goals since our prior-year report. A detailed description of these changes can be found in our ESG Download.

2 Our 30% reduction by 2030 goal covers our purchased goods and services (GHGP category 1) and end-of-life treatment of sold products (GHGP category 12), as aligned with our SBTi target.

3 In 2023, we utilized a new partner, process and platform, and more than doubled the questions asked. As such, 2023 reflects a new baseline from which we will measure our progress going forward.

OUR STRATEGIES IN ACTION

Drive outsized growth in high-value categories through market-driven innovation

We continue to invest in high-value categories, developing new solutions and sustainable innovations that provide significant value to our customers. In 2023, we continued to shift our portfolio toward these categories, both organically and through M&A.

OPTIMIZING LABOR AND SUPPLY CHAIN EFFICIENCY

Accelerating logistics performance and unlocking customer value through RFID innovation

We expanded the use of our RFID technology into logistics, speeding operations, improving item-level tracking and accuracy, and saving time and labor for one of the world’s largest global logistics service providers. This program was the largest single-wave RFID deployment in the industry’s history. Following the implementation in more than 1,000 locations in the United States and Canada, item-level misshipments declined from one in 400 to about one in 1,000.

We are changing how brands and retailers view supply chain operations, and how improvements can quickly deliver savings and advance overall supply chain efficiency. A leading sports retailer, a national grocery chain and a European-based apparel retailer are some of the businesses we partnered with to upgrade historically analog processes with digitally integrated RFID-enabled supply chain solutions.

HELPING BRANDS AND CONSUMERS BETTER CONNECT

Enabling a seamless shopping experience enhances consumer perceptions

We work with leading brands to optimize their omnichannel supply chains and enhance the consumer experience. Through the use of RFID technology, and in partnership with our customers and technology providers, we have supported multiple automated retail self-checkout processes.

In collaboration with a multinational technology company, we helped develop RFID-enabled frictionless checkout in a National Football League team’s stadium merchandise store in the United States.

Every item for sale in the store has a unique RFID tag, which looks like a standard apparel tag. Customers simply enter the store, take what they like and leave through the exit gate. When they pass through the exit gate, the tags on their purchases are read by RFID readers. After exiting the store, the credit or debit card they used is charged. The system requires no queuing or barcodes, improving the consumer experience by making transactions quick and convenient.

Grow profitably in our base business

Our extensive experience creating engineering and process technology, Our products can be found on or branding or tracking in retail and

ct consumers to brands and track consumables annd durable goods, providing our customers with value in the strategic areas of handling efficiency, shipment a accuracy, on-time delivery, inventory management, recycling, marketing and shelf appeal.

ADVANCING SUSTAINABILITY, CIRCULARITY AND TRANSPARENCY

Our CleanFlake™ adhhesive technology, which we launched as an innovation to enable recyclability, is now an industry standard. Our global Label and Packaging Materials team set ouut to create a robust adhesive solution that would a allow polyethylene terephthalate (PET) packaging to b be completely recycled. CleanFlake™ technology was the a answer. Since then, we have introduced the next generation of CleanFlake™. This new iteration combinnes the first-generation CleanFlake™ solution’s wash-off fuunctionality with the properties found in the current portfolio to bring circular solutions to scale.

Enabling rigid plastitic recycling with next-generation CleanFlake™ adhessive technology

Our next-generation C CleanFlake™ technology incorporates high-density polyethyylene (HDPE) recycling compatibility. The CleanFlake™ soluution facilitates rigid plastic recycling without compromising shelf-appeal and label per formance to help CPG customers achieve their sustainability goals.

Our CleanFlake™ tecchnology is now recognized in North America by the Association of Plastic Recyclers for PET and HDPE recycling processes. Our continuing innovation in adhesives demonstrates our leadership in providing solutions that enable a circular economy

Our AD CleanFlake™ adhesive technology is now recognized in North America by the Association of Plastic Recyclers for PET and HDPE recycling processes.

REDUCING WASTE

Making room for more labels with linerless labeling

In 2023, we saw increased market acceptance of our Materials Group’s linerless labeling innovations. This label platform consists of variable information labels used in e-commerce, food delivery, weigh scale, and transportation and logistics applications. Our linerless labeling innovations allow room for 50% to 80% more labels per roll resulting in fewer changeovers and less downtime, as well as material savings compared with standard linered products.

In Europe, AD LinrSave™ and AD LinrConvert™ are the first generation of decorative linerless solutions enabled by micro-perforation technology. These products advance sustainability by greatly reducing label waste, decreasing CO2 and water footprints while providing the functionality and shelf appeal of pressure-sensitive labels. This development marks our next stage of label innovation, propelling the industry to a more sustainable and connected future.

Lead at the intersection of the physical and digital

We envision a future in which every physical item will have a digital identity and digital life. We combine our materials science expertise, Intelligent Label platform and atma.ioSM connected product cloud to address our industries’ and customers’ most complex challenges of optimizing labor and supply chain efficiency, reducing waste, advancing sustainability, circularity and transparency and, ultimately, helping brands and consumers better connect.

OPTIMIZING LABOR AND SUPPLY CHAIN EFFICIENCY

Improving supply chain efficiency

The need for digital product identification and data tracking from origin to manufacture, through to shipper to warehouse and retail locations, to the consumer and endof-life or recycling is more critical than ever. Unexpected disruptions continue to demonstrate the need for efficient and transparent supply chains.

Our Case Verification solution provides critical shipping accuracy and compliance benefits for boxed goods. Using RFID technology and our atma.ioSM connected product cloud, our solution can detect errors at the warehouse level before orders are shipped. One customer increased accuracy by more than 5% at their distribution center level.

After piloting Case Verification, one of our largest athletic apparel and footwear customers quickly rolled out the solution across three continents. They are seeing results in real time using our atma.ioSM dashboard feature.

OPTIMIZING LABOR AND SUPPLY CHAIN EFFICIENCY

Aiding loss detection and prevention, improving inventory accuracy and transforming the customer experience

We partnered with one of the world’s largest fast fashion groups to develop a unique solution that incorporates RFID into their garments, providing inventory visibility as well as enabling electronic article surveillance (EAS) technology to aid in loss detection and prevention and increase inventory accuracy. Our patented AD TexTrace™ technology is woven into the garment or label, eliminating the need for a separate EAS “hard” tag and combining multiple needs into a single solution. We piloted the program in 2023 with one of the group’s brands, demonstrating the value created through improved inventory accuracy on loss prevention, detection and customer satisfaction. We are now rolling out the solution across the brand’s portfolio.

We have worked closely with this fast fashion group to help them optimize operations and labor efficiency through RFID technology, driving item-level data insights that inform decision-making and improve business operations. This operational data has played a crucial role in providing product visibility throughout the supply chain and availability for customers, whether online or in-store, when and where they want to purchase it.

What’s more, the improved inventory management helps optimize labor efficiency, freeing up resources for shopper services that are essential to customer satisfaction.

ADVANCING SUSTAINABILITY, CIRCULARITY AND TRANSPARENCY

Enabling circularity with Modern Milkman

In 2023, we became a top-tier investor for the UK-based Modern Milkman sustainable grocery delivery service. The Modern Milkman application brings together our materials science, RFID and atma.ioSM connected product cloud capabilities to reduce packaging waste in the UK grocery sector. It marks the first use of RFID in the UK to follow returnable packaging throughout its lifecycle.

To date, Modern Milkman has saved millions of plastic bottles. That number will continue to increase with the help of our RFID solution that monitors and tracks Modern Milkman’s reusable glass bottles. Our digital solutions provide item-level traceability and enable quick and effective sorting of large volumes to enable a more circular economy.

Our Embelex™ portfolio of digitally enabled branding solutions connects fans with their favorite team or player.

HELPING BRANDS AND CONSUMERS BETTER CONNECT

Driving fan interaction in U.S. team sports with Embelex™

We continue to extend digital solutions into our Embelex™ external embellishment platform by incorporating digital sensors into our embellishments for professional sports around the world. Our solutions empower teams, venues and sponsors to directly connect with fans and drive deeper fan engagement.

In U.S. professional sports, multiple teams have used the combination of our digital solutions and Embelex™ portfolio to better connect with their fans and put digital technology to work with customized team apparel. Using digitally connected embellishments, teams are providing fans with unique digital content from key sponsors, and some teams are digitally connecting fanwear and marketing events to generate ticketing sales leads.

Effectively allocate capital and relentlessly focus on productivity

Effectively Allocate Capital

We employ a disciplined capital allocation strategy to deliver strong returns. We are investing in our future growth both organically and through acquisitions and venture investments, while returning cash to shareholders through share repurchases and dividends.

HELPING BRANDS AND CONSUMERS BETTER CONNECT

Expanding Embelex™ capability and reach

In support of our strategy to accelerate growth in high-value categories and expand our capabilities, in 2023, we acquired three external embellishments businesses. The move positions us as a leading solutions provider in this key growth platform for our Solutions Group.

We acquired Lion Brothers, a leading designer and manufacturer of apparel brand identity systems. The acquisition significantly broadens our Embelex™ portfolio, a full-service, end-to-end platform for on-product branding, graphics and trims. Lion Brothers has established relationships with leading U.S. sports leagues and brands. Its high-quality fabric embellishments are fully compatible and complementary with our existing Embelex™ portfolio.

Our acquisition of Thermopatch advances our growth strategy in team sports and brings our digitally enabled Embelex™ branding solutions into the workwear, healthcare and laundry industries.

With our recent acquisition of the Silver Crystal Group, we now have an established presence in sports apparel customization and application across in-venue, direct-tobusiness and e-commerce platforms.

Investing in productivity and service flexibility

In 2023, we continued to invest in our Intelligent Labels platform with the construction of our largest manufacturing site in Mexico. The site significantly expands our global capacity and supply chain capability for future industry adoption and growth of intelligent labels. The facility is expected to be operational in 2024.

We also streamlined materials handling and improved productivity and customer service at our Materials Group’s Greenfield, Indiana, manufacturing site. These are the latest refinements to our site, which had several upgrades during an investment and expansion period that started in 2018.

With the expansion of our Painesville, Ohio, manufacturing facility, we continue to invest in capabilities that target high-value categories and further enhance our ability to develop and produce high-quality pressure-sensitive tapes and bonding solutions. Our new energy-efficient coater and production line is expected to begin operation during the second quarter of 2024. We also continued to expand our service proposition to customers by adding a distribution center in Northern California. The investment improves our service and product offering to our wine and spirits customers, providing same or next-day delivery service and enabling the collection of liner waste for recycling.

Relentless Focus on Productivity

Improving Intelligent Label manufacturing

With an eye on improving our RFID business’s growth, lowering capital costs and meeting growing demand, we continuously improve how we produce intelligent labels. In 2023, we developed a second generation of our proprietary inlay manufacturing process that significantly increases processing and the capital efficiency of our manufacturing operations. This process innovation allows us to broaden our service offering as we drive adoption in new categories like food and logistics.

Lead in an environmentally and socially responsible manner

We create value through our products and solutions, and we recognize the essential role that labels, materials and information play in advancing a more sustainable and circular economy. Our research and development efforts include sustainable innovation and product designs that advance the circular economy, reduce materials and waste, use recycled content and extend product end-of-life or enable product recycling.

Goal 1: Deliver innovations that advance the circular economy

ADVANCING SUSTAINABILITY, CIRCULARITY AND TRANSPARENCY Investing in apparel recycling technology

We invested in Circ, a U.S.-based chemical recycler that separates and recycles polyester and cotton from mixed textile waste. Through its proprietary process, Circ returns used garments back to raw materials for reuse.

Our investment will help Circ accelerate the commercialization of its innovation. Circ’s industrial-scale polycotton recycling pilot plants are in development. Once up and running, the sites will allow apparel brands, supported by Avery Dennison digital labeling solutions, to recycle mixed textile waste streams, such as polyester-

Avery

Our Digital Care Label enables Mara Hoffman to support circularity by directly engaging with consumers.

cotton blends, into high-quality cellulose-based or PETbased yarns for use in apparel production.

Additionally, we are working with Circ and other supply chain partners to connect brands with consumers through intelligent garment labeling. Intelligent labels communicate product sustainability information, enable circularity and optimize efficiency by making automation possible at key stages of the recycling process. These developments are foundational to advancing circularity and textile-to-textile recycling in the apparel supply chain.

In one exciting apparel design and creation application, we partnered with luxury brand Mara Hoffman and Circ to create a limited-edition sustainable dress. Dubbed “The Dress that Changes Everything,” the garment features our Digital Care Label that includes a QR code powered by our atma.ioSM connected product cloud. Our label enables consumers to connect with the Mara Hoffman brand to understand the garment’s entire journey and directly engage in circularity by offering information on repair, repurpose and resale options.

ADVANCING SUSTAINABILITY, CIRCULARITY AND TRANSPARENCY

Partnering for package reuse

A sustainability goal at one of the world’s largest, most diversified food and beverage companies is to reduce virgin plastic use by one-third by 2025. To help achieve this target, the business launched a pilot to replace single-use plastic food containers with reusable food containers.

Our European Materials business developed a unique labeling material solution with a low-temperature washoff adhesive that allows labels to be removed in plain water, enabling efficient reuse of the new containers and reducing waste. The solution requires no chemicals or additives. The reusable packaging can be filled up to 80 times before being recycled. The 80-use new containers are estimated to save 36 kilograms of glass and 5 kilograms of plastic packaging compared with the previous single-use food containers.

In another business case, we developed a thinner, lighter recycle-friendly label that conforms to the shape of skin care bottles for a well-known European personal care brand available worldwide. Our Global MDO decorative label with CleanFlake™ technology allows the bottles to be compatible with recycling processes. The solution reduces carbon emissions by 22% and uses 30% less water compared with a typical label.

CST is operational at our Turnhout, Belgium, plant

Northern Europe’s largest concentrated solar thermal (CST) platform and thermal storage installation at our production plant in Turnhout, Belgium, supplies zero-carbon solar energy. It provides heat equivalent to 2.3 GWh of gas consumption, reducing the plant’s greenhouse gas emissions by an average of 9% annually compared to current rates.

Goal 2:

Reduce our environmental impact in our operations and supply chain

Reducing natural gas and electrical consumption

Our Luxembourg manufacturing site lowered its natural gas consumption by reducing waste heat, boosting recuperation, eliminating steam usage and optimizing onsite processes. In just 100 days, the site reduced factory natural gas usage by 20% per square meter compared to 2022. This amount equates to an annual reduction of approximately 6,000 megawatts. Our European Materials’ manufacturing facilities cut gas consumption by 22% and electricity consumption by 13%, decreasing our environmental footprint.

Powering our global facilities with renewable energy

Our renewable energy investments continued throughout 2023, with solar installations that provide an additional 4.8 megawatts of capacity and help power manufacturing operations at several of our global manufacturing facilities. The installations reflect our goal of reducing scope 2 GHG emissions. We have new installations in Ancarano, Italy, and Wehnrath, Germany, along with several new rooftop installations in Asia Pacific. To further advance our sustainability efforts, we expanded our onsite generating capacity in both owned and operated solar arrays and through power purchase agreements.

Goal 3:

Make a positive social impact by enhancing the livelihood of our people and our communities

Our corporate social responsibility (CSR) initiatives are broad, deep and encompassing. They increase education access, advance environmental sustainability and support secure livelihoods. Our employees identify and address needs in their local communities for assistance in areas such as disaster response and diversity, equity and inclusion (DEI). Our corporate social responsibility investments are primarily made through the Avery Dennison Foundation (ADF). Together with our company, ADF made $5.5 million in CSR-related financial contributions in 2023.

In 2023, we invested nearly $1 million to increase education access. Grants include support for youth entrepreneurship in Malaysia and youth literacy in Argentina.

Increasing equity through global grantmaking

We prioritize grants to communities and geographies facing the greatest need. In 2023, we invested nearly $1 million to increase education access. Grants included support for youth entrepreneurship in Malaysia and youth literacy in Argentina.

We also invested $1.3 million to support secure livelihoods. We improved economic access for people in Pakistan and Kenya, sponsored job training for refugees in the Netherlands, and supported Special Olympics Latin America and the UN Foundation’s Resilience Fund for Women in Global Value Chains.

We invested more than $600,000 in environmental sustainability. We awarded a two-year grant to the Gift of the Givers Foundation to support borehole drilling at schools in Cape Town, South Africa, and Samburu, Kenya, to harvest and recycle water, provide water purification solutions and improve clean water access.

Global grantmaking supports youth education and entrepreneurship in Malaysia.

Investing in communities

Our employees also advance community investments with monetary contributions and through volunteerism. In 2023, ADF granted $1 million in 37 countries through its Granting Wishes program, where employees nominate local NGOs to receive grants and organize volunteer events. Through a separate employee-giving program, ADF matched $25,000 contributed by more than 300 employees for earthquake relief in Turkey and war relief in Gaza, Israel and Ukraine. In 2023, ADF established its Employee Crisis Fund to financially assist employees impacted by natural disasters and other humanitarian crises. The fund supported 475 employees in northern China affected by devastating floods.

We are building a culture of inclusion for our manufacturing employees as part of our DEI development programs.

Supporting youth education and entrepreneurship

Partnering with independent third parties to advance education access, ADF provides college scholarships to the children of company employees. The U.S. Scholars program, administered in partnership with Scholarship America, annually awards scholarships to children of employees based in the U.S. and Canada. In 2023, ADF partnered with the Institute of International Education to provide scholarships to children of employees in Bangladesh, Honduras, India, Mexico, Sri Lanka and Vietnam.

Advancing diversity, equity and inclusion (DEI)

In 2023, we continued to advance DEI, focusing on actions and impact aligned to our global DEI pillars of fairness, women leaders, inclusion of manufacturing employees, and increased equity and inclusion for underrepresented groups. We refreshed our diverse slate standards to ensure we source and consider a strong set of candidates with a variety of experiences, backgrounds and perspectives.

We also piloted various leadership development programs to strengthen mentorship and career development with particular attention on underrepresented groups. To improve manufacturing employees’ sense of inclusion, we launched an opt-in smart mobile app that gives access to information they want to see and hear.

Our global Talent Management Team, in partnership with our Company Leadership Team, developed and piloted an enterprise-wide competency model to serve as the consistent standard against which we hire, develop, promote and reward talent.

Supporting DEI through ADF funding

ADF supported organizations promoting DEI globally with grants totaling $395,000. The funding supports minority veterans in the U.S., LGBTQ+ youth in Singapore and India’s first LGBTQI Center of Excellence in Delhi. ADF granted Special Olympics Asia Pacific $40,000 to help people with intellectual disabilities develop physical fitness, courage and skill-building.

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NewYorkStockExchange 1.25%SeniorNotesdue2025 AVY25

NasdaqStockMarket

SecuritiesregisteredpursuanttoSection12(g)oftheAct: Notapplicable.

Indicatebycheckmarkiftheregistrantisawell-knownseasonedissuer,asdefinedinRule405oftheSecuritiesAct.Yes È No ‘

IndicatebycheckmarkiftheregistrantisnotrequiredtofilereportspursuanttoSection13or15(d)oftheAct.Yes ‘ No È

Indicatebycheckmarkwhethertheregistrant(1)hasfiledallreportsrequiredtobefiledbySection13or15(d)oftheSecuritiesExchangeActof 1934duringthepreceding12months(orforsuchshorterperiodthattheregistrantwasrequiredtofilesuchreports),and(2)hasbeensubjecttosuchfiling requirementsforthepast90days.Yes È No ‘

IndicatebycheckmarkwhethertheregistranthassubmittedelectronicallyeveryInteractiveDataFilerequiredtobesubmittedpursuanttoRule405 ofRegulationS-T(§232.405ofthischapter)duringthepreceding12months(orforsuchshorterperiodthattheregistrantwasrequiredtosubmitsuch files).Yes È No ‘

Indicatebycheckmarkwhethertheregistrantisalargeacceleratedfiler,anacceleratedfiler,anon-acceleratedfiler,asmallerreportingcompany, oranemerginggrowthcompany.Seethedefinitionsof“largeacceleratedfiler,”“acceleratedfiler,”“smallerreportingcompany,”and“emerginggrowth company”inRule12b-2oftheExchangeAct.

LargeAcceleratedFiler È

Acceleratedfiler ‘

Non-acceleratedfiler ‘

Smallerreportingcompany ‘

Emerginggrowthcompany ‘

Ifanemerginggrowthcompany,indicatebycheckmarkiftheregistranthaselectednottousetheextendedtransitionperiodforcomplyingwith anyneworrevisedfinancialaccountingstandardsprovidedpursuanttoSection13(a)oftheExchangeAct. ‘

Indicatebycheckmarkwhethertheregistranthasfiledareportonandattestationtoitsmanagement’sassessmentoftheeffectivenessofits internalcontroloverfinancialreportingunderSection404(b)oftheSarbanes-OxleyAct(15U.S.C.7262(b))bytheregisteredpublicaccountingfirmthat preparedorissueditsauditreport. È

IfsecuritiesareregisteredpursuanttoSection12(b)oftheAct,indicatebycheckmarkwhetherthefinancialstatementsoftheregistrantincludedin thefilingreflectthecorrectionofanerrortopreviouslyissuedfinancialstatements. ‘

Indicatebycheckmarkwhetheranyofthoseerrorcorrectionsarerestatementsthatrequiredarecoveryanalysisofincentive-basedcompensation receivedbyanyoftheregistrant’sexecutiveofficersduringtherelevantrecoveryperiodpursuantto§240.10D-1(b). ‘

Indicatebycheckmarkwhethertheregistrantisashellcompany(asdefinedinRule12b-2oftheAct).Yes ‘ No È

Theaggregatemarketvalueofvotingandnon-votingcommonequityheldbynon-affiliatesasofJuly1,2023,thelastbusinessdayofthe registrant’smostrecentlycompletedsecondfiscalquarter,wasapproximately$13.7billion.

Numberofsharesofcommonstock,$1parvalue,outstandingasofJanuary27,2024,theendoftheregistrant’smostrecentfiscalmonth: 80,508,663.

ThefollowingdocumentsareincorporatedbyreferenceintothePartsofthisForm10-Kindicatedbelow:

Document Incorporatedbyreferenceinto:

PortionsofDefinitiveProxyStatementforAnnualMeetingofStockholderstobeheldonApril25,2024

PartsIII,IV

SafeHarborStatement

ThemattersdiscussedinthisAnnualReportonForm10-Kcontain“forward-lookingstatements”withinthemeaning ofthePrivateSecuritiesLitigationReformActof1995.Thesestatements,whicharenotstatementsofhistoricalfact, containestimates,assumptions,projectionsand/orexpectationsregardingfutureevents,whichmayormaynotoccur. Wordssuchas“aim,”“anticipate,”“assume,”“believe,”“continue,”“could,”“estimate,”“expect,”“foresee,”“guidance,” “intend,”“may,”“might,”“objective,”“plan,”“potential,”“project,”“seek,”“shall,”“should,”“target,”“will,”“would,”or variationsthereof,andotherexpressionsthatrefertofutureeventsandtrends,identifyforward-lookingstatements.Our forward-lookingstatements,andfinancialorotherbusinesstargets,aresubjecttocertainrisksanduncertainties,which couldcauseouractualresultstodiffermateriallyfromtheexpectedresults,performanceorachievementsexpressedor impliedbysuchforward-lookingstatements.

Webelievethatthemostsignificantriskfactorsthatcouldaffectourfinancialperformanceinthenearterminclude: (i)theimpactstounderlyingdemandforourproductsfromglobaleconomicconditions,politicaluncertainty,andchanges inenvironmentalstandardsandgovernmentalregulations;(ii)competitors’actions,includingpricing,expansioninkey markets,andproductofferings;(iii)thecostandavailabilityofrawmaterials;(iv)thedegreetowhichhighercostscanbe offsetwithproductivitymeasuresand/orpassedontocustomersthroughpriceincreases,withoutasignificantlossof volume;(v)foreigncurrencyfluctuations;and(vi)theexecutionandintegrationofacquisitions.

Certainrisksanduncertaintiesarediscussedinmoredetailunder“RiskFactors”and“Management’sDiscussionand AnalysisofFinancialConditionandResultsofOperations”inthisAnnualReportonForm10-Kforthefiscalyearended December30,2023.Actualresultsandtrendsmaydiffermateriallyfromhistoricaloranticipatedresultsdependingona varietyoffactors,includingbutnotlimitedto,risksanduncertaintiesrelatedtothefollowing:

•InternationalOperations–worldwideeconomic,social,politicalandmarketconditions;changesinpolitical conditions,includingthoserelatedtoChina,theRussia-Ukrainewar,theIsrael-Hamaswarandrelatedhostilities intheMiddleEast;fluctuationsinforeigncurrencyexchangerates;andotherrisksassociatedwithinternational operations,includinginemergingmarkets

•OurBusiness–fluctuationsindemandaffectingsalestocustomers;fluctuationsinthecostandavailabilityof rawmaterialsandenergy;changesinourmarketsduetocompetitiveconditions,technologicaldevelopments, lawsandregulations,tariffsandcustomerpreferences;increasingenvironmentalstandards;theimpactof competitiveproductsandpricing;executionandintegrationofacquisitions;sellingprices;customerandsupplier concentrationsorconsolidations;financialconditionofdistributors;outsourcedmanufacturers;productand servicequality;restructuringandotherproductivityactions;timelydevelopmentandmarketacceptanceofnew products,includingsustainableorsustainably-sourcedproducts;investmentindevelopmentactivitiesandnew productionfacilities;successfulimplementationofnewmanufacturingtechnologiesandinstallationof manufacturingequipment;ourabilitytogeneratesustainedproductivityimprovement;ourabilitytoachieveand sustaintargetedcostreductions;collectionofreceivablesfromcustomers;oursustainabilityandgovernance practices;andepidemics,pandemicsorotheroutbreaksofillness

•InformationTechnology–disruptionsininformationtechnologysystems,cyberattacksorothersecurity breaches;andsuccessfulinstallationofneworupgradedinformationtechnologysystems

•IncomeTaxes–fluctuationsintaxrates;changesintaxlawsandregulations,anduncertaintiesassociatedwith interpretationsofsuchlawsandregulations;retentionoftaxincentives;outcomeoftaxaudits;andthe realizationofdeferredtaxassets

•HumanCapital–recruitmentandretentionofemployeesandcollectivelaborarrangements

•OurIndebtedness–creditrisks;ourabilitytoobtainadequatefinancingarrangementsandmaintainaccessto capital;fluctuationsininterestrates;volatilityinfinancialmarkets;andcompliancewithourdebtcovenants

•OwnershipofOurStock–potentialsignificantvariabilityofourstockpriceandamountsoffuturedividendsand sharerepurchases

•LegalandRegulatoryMatters–protectionandinfringementofintellectualproperty;impactoflegaland regulatoryproceedings,includingwithrespecttoenvironmental,complianceandanti-corruption,environmental, healthandsafety,andtradecompliance

•OtherFinancialMatters–fluctuationsinpensioncostsandgoodwillimpairment

Ourforward-lookingstatementsaremadeonlyasofFebruary21,2024.Weassumenodutytoupdatethese forward-lookingstatementstoreflectnew,changedorunanticipatedeventsorcircumstances,otherthanasmaybe requiredbylaw.

Item1.BUSINESS

CompanyBackground

AveryDennisonCorporation(“AveryDennison”orthe“Company”andgenerallyreferredtoas“we”or“us”)was incorporatedinDelawarein1977asAveryInternationalCorporation,thesuccessorcorporationtoaCalifornia corporationofthesamenameincorporatedin1946.In1990,wemergedoneofoursubsidiariesintoDennison ManufacturingCompany(“Dennison”),asaresultofwhichDennisonbecameourwholly-ownedsubsidiaryandin connectionwithwhichwechangedournametoAveryDennisonCorporation.Youcanlearnmoreaboutusbyvisitingour websiteatwww.averydennison.com.OurwebsiteaddressprovidedinthisAnnualReportonForm10-Kisnotintended tofunctionasahyperlinkandtheinformationonourwebsiteisnot,norshoulditbeconsidered,partofthisreportor incorporatedbyreferenceintothisreport.

BusinessOverviewandReportableSegments

Weareaglobalmaterialsscienceanddigitalidentificationsolutionscompanythatprovidesawiderangeof brandingandinformationsolutionsthatoptimizelaborandsupplychainefficiency,reducewaste,advancesustainability, circularityandtransparency,andbetterconnectbrandsandconsumers.Ourproductsandsolutionsincludelabelingand functionalmaterials,radio-frequencyidentification(“RFID”)inlaysandtags,softwareapplicationsthatconnectthe physicalanddigital,andavarietyofproductsandsolutionsthatenhancebrandedpackagingandcarryordisplay informationthatimprovesthecustomerexperience.Weserveanarrayofindustriesworldwide,includinghomeand personalcare,apparel,generalretail,e-commerce,logistics,foodandgrocery,pharmaceuticalsandautomotive.

Ourreportablesegmentsforfiscalyear2023were:

•MaterialsGroup;and

•SolutionsGroup

In2023,ourMaterialsGroupandSolutionsGroupreportablesegmentscomprisedapproximately69%and31%, respectively,ofourtotalnetsales.

In2023,internationaloperationsconstitutedasubstantialmajorityofourbusiness,representingapproximately 69%ofournetsales.AsofDecember30,2023,weoperatedover200manufacturinganddistributionfacilitiesinmore than50countries.

MaterialsGroup

OurMaterialsGroupbusinessisaleadingprovidertopressure-sensitivelabelandgraphicsindustriesworldwide. Ourinnovativeproductsincludelabelmaterials,graphicsandreflectivematerialsandfunctionalbondingmaterials,such astapes.Ourlabelmaterialsenhanceshelfappealforbrands,informshoppers,advancecircularity,increasetransparency, helpreducewasteandimproveoperationalsupplychainefficiency.Ourgraphicsportfoliooffershighlyengineered materialsthatrangefromvehiclewrapstoarchitecturalfilms.MaterialsGroupplaysakeyroleinadvancingourfastgrowingintelligentlabelsbusiness,providingthematerialssciencecapabilitiesandprocessengineeringexpertise essentialtodevelopingandmanufacturingintelligentlabelsatscale.

OurMaterialsGroupmanufacturesandsellsFasson®-,JAC®-,andAveryDennison®-brandpressure-sensitive labelmaterialsandperformancetapesproducts,AveryDennison®-andMactac®-brandgraphics,andAveryDennison®brandreflectiveproducts.MaterialsGroup’sbusinesstendsnottobeseasonal,exceptforcertainoutdoorgraphicsand reflectiveproducts.

Pressure-sensitivematerialsconsistprimarilyofpapers,plasticfilms,metalfoilsandfabrics,whicharecoatedwith internally-developedandpurchasedadhesives,andthenlaminatedwithspecially-coatedbackingpapersandfilms.They arethensoldinrollorsheetformwitheithersolidorpatternedadhesivecoatingsinawiderangeoffacematerials,sizes, thicknessesandadhesiveproperties.

Apressure-sensitive,orself-adhesive,materialisonethatadherestoasurfacebypress-oncontact.Itgenerally consistsoffourlayers:afacematerial,whichmaybepaper,metalfoil,plasticfilmorfabric;anadhesive,whichmaybe permanentorremovable;areleasecoating;andabackingmaterialtoprotecttheadhesivefromprematurecontactwith 2 2023AnnualReport | AveryDennisonCorporation

othersurfacesthatcanalsoserveasacarrierforsupportinganddispensingindividuallabels.Whentheproductsare readyforuse,thereleasecoatingandprotectivebackingareremoved,exposingtheadhesivesothatthelabelorother facematerialmaybepressedorrolledintoplace.Becausetheyareeasytoapplywithouttheneedforadhesiveactivation, self-adhesivematerialscanprovidecostsavingscomparedtoothermaterialsthatrequireheat-ormoisture-activated adhesives,whilealsoofferingaestheticandotheradvantagesoveralternativetechnologies.

Labelmaterialsaresoldworldwidetolabelconvertersforlabeling,decoratingandspecialtyapplicationsinthe homeandpersonalcare,beerandbeverage,durables,pharmaceutical,wineandspirits,foodandlogisticsmarket segments.Whenusedinpackagedecorationapplications,thevisualappealofself-adhesivematerialscanhelpincrease salesoftheproductsonwhichthematerialsareapplied.Self-adhesivematerialsarealsousedtoconveyvariable information,suchasRFIDinlaystoenabledigitalidentitiesonitemsandbarcodesformailingorweightandprice informationforpackagedmeatsandotherfoods.Self-adhesivematerialsprovideconsistentandversatileadhesionand areavailableinalargeselectionofmaterials,whichcanbemadeintolabelsofvaryingsizesandshapes.

Ourgraphicsandreflectiveproductsincludeavarietyoffilmsandotherproductsthataresoldtothearchitectural, commercialsign,digitalprintingandotherrelatedmarketsegments.Wealsoselldurablecastandreflectivefilmstothe construction,automotiveandfleettransportationmarketsegmentsandreflectivefilmsfortrafficandsafetyapplications. Weprovidesignshops,commercialprintersanddesignersabroadrangeofpressure-sensitivematerialsthatallowthem tocreateimpactfulandinformativebrandanddecorativegraphics.Weofferawidearrayofpressure-sensitivevinyland specialtymaterialsdesignedfordigitalimaging,screenprintingandsigncuttingapplications.

OurperformancetapesproductsincludeavarietyofFasson®-brandandAveryDennison®-brandtapesandother pressure-sensitiveadhesive-basedmaterialsandconvertedproducts,mechanicalfastenersandperformancepolymers. Ourpressure-sensitiveadhesive-basedmaterialsareavailableinrollformandinawiderangeoffacematerials,sizes, thicknessesandadhesiveproperties.Thesematerialsandconvertedproductsareusedinnon-mechanicalfastening, bondingandsealingsystemsforvariousautomotive,electronics,buildingandconstruction,generalindustrial,personal care,andmedicalapplications.OurperformancetapesproductsincludeYongle®-brandtapesforwireharnessingand cablewrappinginautomotive,electricalandgeneralindustrialapplications.Themechanicalfastenersareprimarily precision-extrudedandinjection-moldedplasticdevicesusedinvariousautomotive,generalindustrialandretail applications.

OurlargercompetitorsinlabelmaterialsincludeUPMRaflatac,asubsidiaryofUPMCorporation;FedrigoniSelfAdhesives;LintecCorporation;FlexconCorporation,Inc.;andanarrayofsmallerregionalandlocalcompanies.For graphicsandreflectiveproducts,ourlargestcompetitorsare3MCompany(“3M”)andtheOrafolGroup.Forperformance tapesproducts,ourcompetitorsinclude3M;Tesa-SE,asubsidiaryofBeiersdorfAG;NittoDenkoCorporation;and numerousregionalandspecialtysuppliers.Forfastenerproducts,thereareavarietyofcompetitorssupplyingextruded andinjectionmoldedfastenersandfastenerattachingequipment.Webelievethatentryofcompetitorsintothefieldof pressure-sensitiveadhesivesandmaterialsislimitedbytechnicalknowledgeandcapitalrequirements.Webelievethat ourtechnicalexpertise,sizeandscaleofoperations,broadlineofqualityproductsandreliableservice,productand processinnovation,distributioncapabilities,brandstrengthandproductinnovationaretheprimaryadvantagesin maintainingandfurtherdevelopingourcompetitiveposition.

SolutionsGroup

OurSolutionsGroupisaleadingglobalproviderofinformationandbrandingproductsandsolutionsthatcovera breadthofcustomerneedsfromdigitalidentificationanddatamanagement,brandingandembellishment,aswellas productivity,pricingandretailmedia.Weempowercustomersacrossmultipleretailandindustrysegmentstoconnect thephysicalanddigitalworlds,leveragingourindustry-leadingRFIDsolutions.Ourtechnologyaddressescomplex customerchallenges,providestransparencyandvisibilityacrosssupplychains,improveslaborandwasteefficiency,and enablesbetterconsumerexperiencesatthepointofpurchaseandbeyond.Marketsegmentsservedincludetheglobal apparel,logistics,foodandgrocery,andgeneralretailindustries.Asalargeultra-highfrequencyRFIDsolutionsprovider, weleverageourinnovationanddatamanagementcapabilities,globalfootprintandmarketaccessintheongoing advancementofourintelligentlabelsbusiness.

ThebrandingsolutionsoftheSolutionsGroupincludebrandembellishments,graphictickets,tags,andlabels,and sustainablepackaging.SolutionsGroup’sinformationsolutionsincludeitem-levelRFIDsolutions;visibilityandloss preventionsolutions;priceticketingandmarking;care,content,andcountryoforigincompliancesolutions;brand protectionandsecuritysolutions;andVestcom®-brandshelf-edgeproductivityandmediasolutions.

IntheSolutionsGroup,ourprimarycompetitorsincludeCheckpointSystems,Inc.,asubsidiaryofCCLIndustries Inc.;R-pacInternationalCorporation;andSMLGroupLimited.Webelievethatourproduct,processandsolution innovation,globaldistributionnetwork,reliableservice,productqualityandconsistency,andabilitytoservecustomers consistentlywithcomprehensivesolutionsclosetowheretheymanufacture,sourceandsellarethekeyadvantagesin maintainingandfurtherdevelopingourcompetitiveposition.

Research,DevelopmentandInnovation

Asagloballeaderinmaterialsscience,weinnovatetodevelopandintroducenewproductsandsolutionsthathelp customerssolveforsomeofthemostcomplexproblemsintheindustriesweserve.Ourvisionistoleveragethestrengths ofourMaterialsandSolutionsbusinessestoleadattheintersectionofthephysicalanddigitalworlds.Ourdecadesof experiencecreatingsolutionsforcustomersandourcorecapabilitiesinmaterialsscience,engineeringandprocess technologyenableustodrivecontinuousinnovationthroughoutourindustries.Ourinnovationeffortsfocuson anticipatingmarketandcustomerchallengesandopportunities,andapplyingtechnologytoaddressthem.Our investmentininnovationaimstoaccelerategrowth,expandmarginsandenablecustomersuccessbyleveragingscalable innovationplatformsanddeliveringsustainabilityinitiativesandadvancedtechnologies.

Manyofournewproductsresultfromourresearchanddevelopmentefforts.Theseeffortsaredirectedprimarily towarddevelopingproductsandsolutions,operatingtechniquesandimprovingproductivity,sustainabilityandproduct performance,oftenincloseassociationwithourcustomersorendusers.Theseeffortsprovideintellectualpropertythat leveragesourresearchanddevelopmentrelatingtoadhesives,aswellasprintingandcoatingtechnologies,films,release andinkchemistriesinMaterialsGroup.WefocusonresearchprojectsrelatedtoRFID,externalembellishments,dataand digitalsolutionsandprintingtechnologiesinSolutionsGroup,ineachcaseforwhichwehaveandlicenseanumberof patents.Additionally,ourresearchanddevelopmenteffortsincludesustainableinnovationanddesignofproductsthat advancethecirculareconomy,reducematerialsandwaste,userecycledcontent,andextendproductend-of-lifeor enableproductrecycling.

AcquisitionsandVentureInvestments

Inadditiontoourinvestmentstosupportorganicgrowth,wehavepursuedcomplementaryandsynergistic acquisitions.In2023,weacquiredSilverCrystalGroup(“SilverCrystal”),aCanada-basedproviderofsportsapparel customizationandapplicationsolutionsacrossin-venue,direct-to-businessande-commerceplatforms;LGGroup,Inc. (“LionBrothers”),aMaryland-baseddesignerandmanufacturerofapparelbrandembellishments;andThermopatch,Inc. (“Thermopatch”),aNewYork-basedmanufacturerspecializinginlabeling,embellishmentsandtransfersforthesports, industriallaundry,workwearandhospitalityindustries.Theaggregatepurchaseconsiderationforthese2023acquisitions wasapproximately$231million.In2022,weacquiredTexTraceAG(“TexTrace”),aSwitzerland-basedtechnology developerspecializingincustom-madewovenandknittedradio-frequencyidentificationproductsthatcanbesewnonto orinsertedintogarments,aswellasRietveldSerigrafieB.V.andRietveldScreenprintingSerigrafiBaskiMatbaaTekstil IthalatIhracatSanayiveTicaretLimitedSirketi(collectively,“Rietveld”),aNetherlands-basedproviderofexternal embellishmentsolutionsandapplicationandprintingmethodsforperformancebrandsandteamsportsinEurope.The aggregatepurchaseconsiderationfortheacquisitionsofTexTraceandRietveldwasapproximately$35million.During 2023,wealsomadeoneventureinvestmentinacompanydevelopingtechnologicalsolutionsthatwebelievehavethe potentialtoadvanceourbusinesses.Forinformationregardingouracquisitions,seeNote2,“BusinessAcquisitions,”in theNotestoConsolidatedFinancialStatements.Forinformationregardingourventureinvestments,seeNote9,“Fair ValueMeasurements,”intheNotestoConsolidatedFinancialStatements.

Patents,TrademarksandLicenses

Thelossofindividualpatentsorlicenseswouldnotbematerialtoustakenasawhole,nortoouroperating segmentsindividually.OurprincipaltrademarksareAveryDennison,ourlogo,andFasson.Webelievethesetrademarks arestronginthemarketsegmentsinwhichweoperate.

HumanCapitalResources

OurGlobalWorkforce

Withapproximately69%ofour2023netsalesoriginatingoutsidetheU.S.andapproximately40%ofournet salesoriginatinginemergingmarkets(AsiaPacific,LatinAmerica,EasternEuropeandMiddleEast/NorthernAfrica),our 4 2023AnnualReport | AveryDennisonCorporation

employeesarelocatedinmorethan50countriestobestserveourcustomers.Approximately83%ofouremployeesat year-end2023werelocatedoutsidetheU.S.andapproximately66%werelocatedinemergingmarkets.

Thechartsbelowshowourglobalemployeepopulationbyregionandoperationalfunction.Over19,000ofour approximately35,000employeesatyear-end2023,representingapproximately56%ofourglobalworkforce,werein AsiaPacific,servingourcustomersinthatregion.Atthattime,approximately65%ofourglobalworkforceworkedinthe operationsofourmanufacturingfacilitiesorinpositionsdirectlysupportingthemfromotherlocations.

Talent&Development

Attracting,developingandretaininghighly-skilledtalentiscriticaltoourabilitytocontinuouslydeliversustainable growth.Weprovideongoingsupportandresourcestoourteammembersworldwidetoensurethattheirskillsevolve withourbusinessneeds,industrytrendsandhumancapitalmanagementbestpractices,aswellasenableincreased productivity,peakperformanceandcareergrowth.Wehaverobusttalentreviewandsuccessionplanningprocessesthat provideindividuallytargeteddevelopmentopportunitiesforourteammembers.Weemphasizeon-the-jobdevelopment andcoaching,andalsoprovidefacilitator-ledanddirect-accessonlinetraining,responsibilityforexecutingspecial projectsand,insomecases,cross-functionalorcross-regionalworkassignments.

Pay&Benefits

Ourcompensationphilosophyistooffermarket-based,competitivewagesandbenefitsinthemarketswherewe competefortalent–allofouremployeeswerepaidatleasttheapplicablelegalminimumwage,andover98%ofour employeeswerepaidabovetheapplicablelegalminimumwageatyear-end2023.Payisgenerallypositionedaroundthe marketmedian,withvariancesbasedonknowledge,skills,yearsofexperienceandperformance.Inadditiontobase wages,ourcompensationandbenefitprograms—whichvarybyregion,countryandbusinessunit—includeshort-term incentives(generallypaidincash),long-termincentives(e.g.,cash-orstock-basedawards),employeesavingsplans, healthcareandinsurancebenefits,healthsavingsandflexiblespendingaccounts,paidtimeoff,familyleaveand employeeassistanceprograms.Weannuallyevaluatepayequity,makingadjustmentswhereappropriate.In2023,we reviewedpayequity(consideringtotalbase,annualincentivecompensationandlongtermincentives)withrespectto genderforallnon-manufacturingemployeesglobally,aswellasmanufacturingemployeesintheU.S.andcertainother countries,andwithrespecttorace/ethnicityforallU.S.employees.Weofferflexibleworkarrangementsforourofficebasedworkforcetoprovidethemwithgreaterflexibilitytobalancetheirworkandpersonalcommitments,whileensuring thatwemeettheneedsofourbusiness.Ourinfrastructure,informationsecurityanddigitaltoolssupportemployee efficiencyandeffectivenesswherevertheywork.

EmployeeEngagement

Becausewebelievethatanengagedworkforcepromotesretentionandminimizesemployeeturnover,weannually conductaglobalemployeeengagementsurvey.Withafocusoncontinuousimprovement,in2023welaunchedour surveyusingamoreadvancedplatformprovidingreal-timeaccesstoresults,improvedanalyticsandabilitytoconnect datathroughouttheemployeeexperience,moremeaningfulcomparisonstoexternalbenchmarks,andongoingpulse surveycapability.Ourbusinessandfunctionalteamsusetheanonymizedresultsofoursurveytoidentifyandimplement actionstoaddresspotentialopportunitiesforimprovement.Whileemployeeengagementistheresultofmanyfactors, webelievestrong,encouragingandopenleadership,aswellasacontinuedefforttofosteracollaborative,supportive culture,leadstostrongworkforceengagement.

WorkforceHealth&Safety

Safetyisoneofourhighestpriorities,andwecontinuallyworktoensureourmanufacturingfacilities,distribution centersandadministrativeofficesfocusonsafety,sothatanyoneworkinginorvisitingoneofourlocationsfeelsand remainssafefrominjury.OurglobalRecordableIncidentRateof0.22in2023wassignificantlylowerthanthe OccupationalSafetyandHealthAdministrationmanufacturingindustryaverageof3.2in2022(themostrecentavailable industryaverage).

Diversity,Equity&Inclusion

Ourdiversity,equityandinclusion(“DEI”)effortsareintendedtofosteranenvironmentwhereemployeescan growandbeincreasinglyproductiveandinnovative,enhancingourreputationasagreatplacetoworkandallowingusto attractandretaintalentforthebenefitofourstakeholders.Theseeffortscontinuetogainmomentumandcreateimpact. In2023,wesignificantlyincreasedthenumberofquestionsweaskedaroundDEIinourannualemployeeengagement survey.Byaligningtoexternalbestpracticequestions,wecanmoredeeplyunderstandourDEIprogressand opportunities.OurDEIglobalstrategicpillarsoffocuscontinuetobe:increasingthenumberofwomenwhohold leadershippositions;enhancingtheexperienceofourmanufacturingemployees;increasingrepresentationandinclusion forunderrepresentedgroups,withprioritypopulationsandactionsestablishedregionally;andmakingmeritand transparencyevenmorefoundationaltoouremployeeexperience.During2023,wecontinuedconductinglistening sessionstobetterunderstandbothourstrengthsandareasofopportunity,andhavedeployedprogrammaticstrategies suchasleadershipdevelopmentprogramming;sponsorshipandmentorshipprograms;connectioneventstobuilda cultureofinclusionforourmanufacturingemployeesacrosstheglobe;andtalentanalyticsandpipelinemodelingto furtheradvanceinclusion.Additionally,ourRegionalDEICouncilsandEmployeeResourceGroups(“ERGs”)continueto beintegralinadvancingourDEIstrategy.ERGs,whichareopentoallemployees,bringteammemberswhohaveshared interests,providingthemameanstocollectivelyamplifytheirvoices.

ManufacturingandEnvironmentalMatters

Weusevariousrawmaterials–primarilypaper,plasticfilmsandresins,aswellasspecialtychemicalspurchased fromvariouscommercialandindustrialsources–thataresubjecttopricefluctuations.Althoughshortagescanoccurfrom timetotime,theserawmaterialsaregenerallyavailable.

Weproduceamajorityofourself-adhesivematerialsusingwater-basedemulsionandhot-meltadhesive technologies.Aportionofourmanufacturingprocessforself-adhesivematerialsutilizesorganicsolvents,which,unless controlled,couldbeemittedintotheatmosphereorcontaminatesoilorgroundwater.Emissionsfromtheseoperations containsmallamountsofvolatileorganiccompounds,whichareregulatedbyfederal,state,localandforeign governments.Wecontinuetoevaluatetheuseofalternativematerialsandtechnologiestominimizetheseemissions.In connectionwiththemaintenanceandacquisitionofcertainmanufacturingequipment,weinvestinsolventcaptureand controlunitstoassistinregulatingtheseemissions.

Wehavedevelopedadhesivesandadhesiveprocessingsystemsthatminimizetheuseofsolvents.Emulsion adhesives,hot-meltadhesives,andsolventlessandemulsionsiliconesystemshavebeeninstalledinmanyofourfacilities.

Basedoncurrentinformation,wedonotbelievethatthecostofcomplyingwithapplicablelawsregulatingthe emissionordischargeofmaterialsintotheenvironment,orotherwiserelatingtotheprotectionoftheenvironment,will haveamaterialeffectuponourcapitalexpenditures,consolidatedfinancialposition,resultsofoperationsorcompetitive position.

Forinformationregardingourpotentialresponsibilityforcleanupcostsatcertainhazardouswastesites,see Note8,“Contingencies,”intheNotestoConsolidatedFinancialStatements.

AvailableInformation

OurAnnualReportsonForm10-K,QuarterlyReportsonForm10-Q,CurrentReportsonForm8-Kand amendmentstothosereportsfiledwith,orfurnishedto,theSecuritiesandExchangeCommission(“SEC”)pursuantto Section13(a)or15(d)oftheSecuritiesExchangeActof1934,asamended(the“ExchangeAct”),areavailablefreeof chargeonourinvestorwebsiteatwww.investors.averydennison.comassoonasreasonablypracticableaftertheyare electronicallyfiledwithorfurnishedtotheSEC.Thiswebsiteaddressisnotintendedtofunctionasahyperlinkandthe 6 2023AnnualReport | AveryDennisonCorporation

informationlocatedthereisnot,norshoulditbeconsidered,partofthisreportorincorporatedbyreferenceintothis report.WealsomakeavailableontheinvestorssectionofourwebsiteunderCorporateGovernance–thefollowing documentsascurrentlyineffect:(i)AmendedandRestatedCertificateofIncorporation;(ii)AmendedandRestated Bylaws;(iii)CorporateGovernanceGuidelines;(iv)CodeofConduct,whichappliestoourdirectors,officersand employees;(v)CodeofEthicsforourChiefExecutiveOfficerandSeniorFinancialOfficers;(vi)chartersoftheAudit, TalentandCompensation,GovernanceandFinanceCommitteesofourBoardofDirectors;and(vii)AuditCommittee ComplaintProceduresforAccountingandAuditingMatters.Thesedocumentsarealsoavailablefreeofchargeupon writtenrequesttoourCorporateSecretary,AveryDennisonCorporation,8080NortonParkway,Mentor,Ohio44060.

ReportsfiledwithorfurnishedtotheSECmaybeviewedatwww.sec.gov.

Item1A.RISKFACTORS

Theriskfactorsdescribedinthissectioncouldmateriallyadverselyaffectourbusiness,includingourresultsof operations,cashflowsandfinancialcondition,andcausethevalueofoursecuritiestodecline.Thislistofrisksisnot exhaustive.Ourabilitytoattainourgoalsandobjectivesisdependentonnumerousfactorsandrisks,including,butnot limitedto,themostsignificantonesdescribedinthissection.

RiskRelatedtoOurInternationalOperations

Thedemandforourproductsisimpactedbytheeffectsof,andchangesin,worldwideeconomic,social,politicaland marketconditions,whichhavehadinthepastandcouldinthefuturehaveamaterialadverseeffectonourbusiness.

Wehaveoperationsinmorethan50countriesandourdomesticandinternationaloperationsarestrongly influencedbymattersbeyondourcontrol,includingchangesinpolitical,social,economicandlaborconditions(including governmentalshutdowns),taxlaws(includingU.S.taxesonforeignearnings),andinternationaltraderegulations (includingtariffs),aswellastheimpactthesechangeshaveondemandforourproducts.In2023,approximately69%of ournetsaleswerefrominternationaloperations.

Macroeconomicdevelopmentssuchasimpactsfromslowergrowthingeographicregionsinwhichweoperate; inflation;rawmaterial,freightandlaboravailabilityandcost;energycosts;political,social,supplychainandother disruptions;epidemics,pandemicsorotheroutbreaksofillness,diseaseorvirus;anduncertaintyintheglobalcreditor financialmarketsleadingtoalossofconsumerconfidencecouldresultinamaterialadverseeffectonourbusinessasa resultof,amongotherthings,lowerconsumerspending,reducedassetvaluations,diminishedliquidityandcredit availability,volatilityinsecuritiesprices,creditratingdowngradesandfluctuationsinforeigncurrencyexchangerates.

TensionsremaininrelationsbetweentheU.S.andChina.Inrecentyears,theU.S.governmentimposedor increasedtariffsonvariousproductsimportedintotheU.S.fromChina.Thishasresultedinreciprocaltariffsongoods importedfromtheU.S.intoChina.Theimpactsonouroperationstodatehavenotbeensignificant.However,our businesscouldbesignificantlyimpactedifadditionaltariffsorotherrestrictionsareimposedonproducts.Theseactions orotherdevelopmentsininternationaltraderelationscouldhaveamaterialadverseeffectonourbusiness.

Inaddition,businessandoperationaldisruptionsordelayscausedbypolitical,socialoreconomicinstabilityand unrest–suchasrecentcivil,politicalandeconomicdisturbancesinArgentina,Afghanistan,Syria,Iraq,Yemen,Iran, Turkey,NorthKorea,HongKongandSriLankaandtherelatedimpactonglobalstability,theRussia-Ukrainewar,the Israel-Hamaswar,terroristattacksandthepotentialforotherhostilitiesornaturaldisastersinvariouspartsoftheworld–couldcontributetoaclimateofeconomicandpoliticaluncertaintythatcouldhaveamaterialadverseeffectonour business.TheRussia-UkrainewarthatbeganinFebruary2022continuedin2023andwemaintainedourpositionofnot shippingproductsfortheRussianmarketthroughouttheyear.Theimpactofthecontinuingwarandourexitfromour Russia-relatedbusiness,aswellasanyfurtherretaliatoryactionstakenbyRussia,theU.S.,theEuropeanUnionandother jurisdictions,isunknownandcouldhaveamaterialadverseeffectonourbusiness.InOctober2023,thewarbetween IsraelandHamasbegan.OursalesinIsraelin2022werelessthan1%ofourtotalnetsalesandhavedeclinedsincethe beginningofthewar.WehaveexperiencedsomedisruptionsinouroperationsinIsraelandimplementedplansto addressthesedisruptions,whichincludedsourcingproductionfromalternativelocationswhilefocusingonthecontinued safetyofourIsraeliemployeesandtheirfamilies.TheimpactofthiswarandanyrelatedhostilitiesintheMiddleEast regionorelsewhereisunknownandcouldhaveamaterialadverseeffectonourbusiness.

Wearenotabletopredictthedurationandseverityofadverseeconomic,social,politicalormarketconditionsin theU.S.orothercountries.

Foreigncurrencyexchangerates,andfluctuationsinthoserates,maymateriallyadverselyaffectsourbusiness.

Thesubstantialmajorityofournetsalesin2023wasinforeigncurrencies.Fluctuationsincurrencyexchange rates,suchasthoseassociatedwiththeArgentinepesoandChineserenminbiwhichhadunfavorableimpactsin2023, mayresultinavarietyofnegativeeffects,includinglowernetsales,increasedcosts,lowergrossmarginpercentages, increasedallowanceforcreditlossesand/orwrite-offsofaccountsreceivable,andrequiredrecognitionofimpairmentsof capitalizedassets,includinggoodwillandotherintangibleassets.Foreigncurrencytranslationdecreasedournetsalesin 2023byapproximately$58millioncomparedtotheprioryear.

Wemonitorourforeigncurrencyexposuresandmayusehedginginstrumentstomitigatetransactionalexposure tochangesinforeigncurrencies.Theeffectivenessofourhedgesinpartdependsonourabilitytoaccuratelyforecastour futurecashflows,whichisparticularlydifficultduringperiodsofuncertaindemandforourproductsandservicesand highlyvolatileforeigncurrencyexchangerates.Ourhedgingactivitiesmayoffsetonlyaportion,ornoneatall,ofthe materialadversefinancialeffectsofunfavorablemovementsinforeigncurrencyexchangeratesoverthelimitedtimethe hedgesareinplaceandwemayincursignificantlossesfromtheseactivities.

Ourstrategyincludesincreasedgrowthinemergingmarkets,includingChina,whichcreatesgreaterexposureto unstablepoliticalconditions,civilunrest,economicvolatility,contagiousdiseaseandotherrisksapplicableto internationaloperations.

Asignificantamountofournetsales–approximately40%in2023–originatedinemergingmarkets,which includescountriesinAsiaPacific,LatinAmerica,EasternEuropeandMiddleEast/NorthernAfrica.Theprofitablegrowth ofourbusinessinemergingmarketsisasignificantfocusofourlong-termgrowthstrategyandourregionalresultshave andcanfluctuatesignificantlybasedontheireconomicconditions.Ourbusinessoperationshavebeenandmaycontinue tobeadverselyaffectedbythecurrentandfuturepoliticalenvironmentinChina,includingasaresultofitsresponseto tariffsimposedbytheU.S.governmentongoodsimportedfromChina,tariffsimposedbyChinaonU.S.goods,the increasinguseofeconomicsanctionsandexportcontrolrestrictions,anytradeagreementsenteredintobetweentheU.S. andChina,andtensionsrelatedtoHongKongandTaiwan.OurabilitytooperateinChinaorotheremergingmarketshas beenandmaycontinuetobeadverselyaffectedbychangesinthelawsandregulationsofthesejurisdictionsortheir interpretationthereof,includingthoserelatingtotaxation,importandexporttariffs,rawmaterials,environmental regulations,landuserights,property,foreigncurrencyconversion,theregulationofprivateenterprisesandothermatters.

Epidemics,pandemicsorotheroutbreaksofillness,diseaseorvirusandotheradversedevelopmentsinemerging marketsmateriallyadverselyaffectedourbusinessatvarioustimesduringthe2020-2023period.Therehavebeenand couldbefurtherdisruptionsinoursupplychainorabilitytomanufactureourproducts,aswellastemporaryclosuresof ourfacilitiesorthoseofoursuppliersorcustomers,whichhaveimpactedandcouldinthefutureimpactoursalesand operatingresults.

Ifweareunabletosuccessfullyexpandourbusinessinemergingmarketsorachievethereturnoncapitalwe expectfromourinvestmentsinthesecountries,ourfinancialperformancecouldbemateriallyadverselyaffected.In additiontotherisksapplicabletoourinternationaloperations,factorsthathavenegativelyimpactedouroperationsin theseemergingmarketsfromtimetotimeincludethelessestablishedorreliablelegalsystemsandpossibledisruptions duetounstablepoliticalconditions,civilunrestoreconomicvolatility.Thesefactorscanhaveamaterialadverseeffecton ourbusinessintheaffectedmarketsbydecreasingconsumerpurchasingpower,reducingdemandforourproductsor increasingourcosts.

OuroperationsandactivitiesoutsideoftheU.S.subjectsustorisksdifferentfromandpotentiallygreaterthanthose associatedwithourdomesticoperations.

AsubstantialportionofouremployeesandassetsarelocatedoutsideoftheU.S.and,in2023,approximately69% ofoursaleswasgeneratedoutsideoftheU.S.Internationaloperationsandactivitiesinvolverisksthataredifferentfrom andpotentiallygreaterthantheriskswefaceinourdomesticoperations,includingchangesinforeignpolitical,regulatory andeconomicconditions,whethernationally,regionallyorlocally;changesinforeigncurrencyexchangerates;inflation; reducedprotectionofintellectualpropertyrights;lawsandregulationsimpactingtheabilitytorepatriateforeignearnings; challengescomplyingwithforeignlawsandregulations,includingthoserelatingtosales,operations,taxes,employment andlegalproceedings;establishingeffectivecontrolsandprocedurestomonitorcompliancewithU.S.lawsand regulationssuchastheForeignCorruptPracticesActandsimilarforeignlawsandregulations,suchastheUK’sBribery 8 2023AnnualReport | AveryDennisonCorporation

Actof2010;differencesinlendingpractices;challengeswithcomplyingwithapplicableexportandimportcontrollaws andregulations;anddifferencesinlanguage,cultureandtimezone.

RisksRelatedtoOurBusiness

Asamanufacturer,oursalesandprofitabilitydependupontheavailabilityandcostofrawmaterialsandenergy, whicharesubjecttopricefluctuations,andourabilitytocontroloroffsetincreasesinrawmaterialandlaborcosts. Rawmaterialandfreightcostincreaseshaveimpactedourbusiness.

Themarketsfortherawmaterialsusedinourbusinessesarechallengingandcanbevolatile,impactingraw materialavailabilityandpricing.Additionally,energycostscanbevolatileandunpredictable.Shortagesandinflationaryor otherincreasesinthecostsofrawmaterials,labor,freightandenergyhaveoccurredinthepast,andcouldrecur.In2021 and2022,weimplementedtargetedpriceincreasesinourMaterialsGroupreportablesegmenttoaddressrawmaterial inflation,whichbeganmoderatingin2023.Ifweexperienceinflationaryheadwindsinthefuture,wemayimplement similarpricingmeasures.Ourperformancedependsinpartonourabilitytooffsetincreasedrawmaterialcostsbyraising oursellingpricesorre-engineeringourproducts.

Itisalsoimportantforustoobtaintimelydeliveryofmaterials,equipment,andotherresourcesfromsuppliers,and tomaketimelydeliverytocustomers.Wemayexperiencesupplychaindisruptionsduetonaturalandotherdisastersor otherevents,orourexistingrelationshipswithsupplierscoulddeteriorateorendinthefuture.Anysuchdisruptioninour supplychaincouldhaveamaterialadverseeffectonoursalesandprofitability,andanysustainedinabilitytoobtain adequatesuppliescouldhaveamaterialadverseeffectonourbusiness.

Weareaffectedbychangesinourmarketsduetocompetitiveconditions,technologicaldevelopments,lawsand regulations,andcustomerpreferences.Ifwedonotcompeteeffectivelyorrespondappropriatelytothesechanges,it couldreducemarketdemand,orwecouldlosemarketshareorreduceoursellingpricestomaintainmarketshare, anyofwhichcouldmateriallyadverselyaffectourbusiness.

Wefacetheriskthatexistingornewcompetitors,whichincludesomeofourcustomers,distributors,and suppliers,willexpandinourkeymarketsegmentsordevelopnewtechnologies,enhancingtheircompetitiveposition relativetoours.Competitorsalsomaybeabletoofferadditionalproducts,services,lowerpricesorotherincentivesthat wecannotorthat,tomaintainprofitability,wemaynotbeabletooffer.Therecanbenoassurancethatwewillbeableto competesuccessfullyagainstcurrentorfuturecompetitorsornewtechnologies.

Wealsoareexposedtochangesincustomerorderpatterns,suchaschangesinthelevelsofinventorymaintained bycustomersandthetimingofcustomerpurchases,whichmaybeaffectedbyannouncedpriceincreases,changesinour customerincentiveprograms,orchangesinthecustomer’sabilitytoachieveincentivetargets.Changesincustomers’ preferencesforourproductscanalsoaffectdemandforourproductsandadeclineindemandforourproductscould haveamaterialadverseeffectonourbusiness.InourMaterialsGroupreportablesegment,assupplychainconstraints easedin2022,customersincreasedinventorylevelsfollowingaperiodofreducedavailability.Inthefourthquarterof 2022,inventoriesdownstreamfromourcompanybegantounwindswiftly,resultinginlowerdemand.Thiscontinuedin 2023,withvolumeimprovingsequentiallythroughouttheyear.

Weareaffectedbychangesinourmarketsduetoincreasingenvironmentalstandards.Ifwedonotrespond appropriatelytothesechanges,itcouldnegativelyimpactmarketdemand,ourmarketshareandpricing,anyof whichcouldmateriallyadverselyaffectourbusiness.Adverseweatherconditionsandnaturaldisasters,including thoserelatedtotheimpactsofclimatechange,adverselyaffectourbusiness.

Asubstantialamountofourlabelmaterialsissoldforuseinplasticpackaginginthefood,beverage,andhome andpersonalcaremarketsegments.Inrecentyears,therehasbeenanacceleratedfocusonsustainabilityand transparencyinsustainabilityreporting,withgreaterconcernregardingclimatechangeandsingle-useplastics,corporate commitmentsandincreasingstakeholderexpectationsregardingthereuseandrecyclabilityofplasticpackagingand recycledcontent,andincreasedregulationinmultiplegeographiesregardingthecollection,recyclinganduseofrecycled content.Changesinconsumerpreferencesandlawsandregulationsrelatedtotheuseofplasticsreducesdemandfor certainofourproductsbutalsohasthepotentialtoincreasedemandforourmoresustainableproducts.Wehave establishedastrategicinnovationplatform,amongotherthings,focusedonmaterialcircularityandwasteelimination/ reductiontodevelopproductsandsolutionsthatadvancethecirculareconomyandaddresstheneedforincreased

recyclabilityofplasticpackaging,incollaborationwithourcustomersandthebusinessesinoursupplychain.Wehave madeconsiderableinvestmentsinoursustainability-drivenproducts,buttherecanbenoassurancethattheywillbe successful,andasignificantreductionintheuseofplasticpackagingcouldmateriallyadverselyaffectdemandforour products.

Thescientificconsensusisthattheemissionofgreenhousegases(“GHG”)isalteringouratmosphereinwaysthat areadverselyaffectingglobalclimate.Thereiscontinuingconcernfrommembersofthescientificcommunityandthe generalpublicthatGHGemissionsandotherhumanactivitieshaveorwillcausesignificantchangesinweatherpatterns andincreasethefrequencyorseverityofextremeweatherevents,includingdroughts,wildfiresandflooding.Thesetypes ofextremeweathereventshaveandmaycontinuetoadverselyimpactus,oursuppliers,ourcustomersandtheirabilityto purchaseourproductsandourabilitytotimelyreceiveappropriaterawmaterialstomanufactureandtransportour productsonatimelybasis.Concernregardingclimatechangehasledandislikelytocontinueleadingtoincreasing demandsbylegislatorsandregulators,customers,consumers,investors,employeesandnon-governmentalorganizations forcompaniestoreducetheirGHGemissions.Oneofour2025sustainabilitygoalsistoachieveatleasta3%absolute reductioninourGHGemissionsyear-over-yearandatleasta26%absolutereductioncomparedtoour2015baselineby 2025;wehavealreadyexceededthecumulative2025GHGemissionsreductiongoal.Aspartofourmoreambitious 2030sustainabilitygoals,weareaimingby2030toreduceourScope1and2GHGemissionsby70%comparedtoour 2015baselineandworkwithoursupplychaintoreduceScope3GHGemissionsby30%againstour2018baseline;we alsohaveanambitiontobenetzeroby2050.Wecouldfaceriskstoourreputation,investorconfidenceandmarket shareifweareunabletocontinuereducingourGHGemissions.Increasedrawmaterialcosts,suchasforfueland electricity,andcompliance-relatedcostscouldalsoimpactcustomerdemandforourproducts.Theextentoftheimpactof climatechangeonourbusinessisuncertain,asitwilldependonthelimitsimposedby,andtimingof,neworstricterlaws andregulations,morestringentenvironmentalstandardsandexpectations,andevolvingcustomerandconsumer preferences,butitislikelytoincreaseourcostsandcouldhaveamaterialadverseeffectonourbusiness.

Wehaverecentlyacquiredcompaniesandarelikelytoacquireothercompanies.Acquisitionscomewithsignificant risksanduncertainties,includingthoserelatedtointegration,technologyandemployees.

Togrowexistingbusinessesandexpandintonewareas,wehavemadeacquisitionsandarelikelytocontinue acquiringcompaniesthatincreaseourpresenceinhighvalueproductcategories,increaseourpaceofinnovationand advanceoursustainabilitypriorities.In2023,weacquiredSilverCrystal,LionBrothersandThermopatchforaggregate purchaseconsiderationofapproximately$231million.In2022,weacquiredTexTraceandRietveldforaggregate purchaseconsiderationapproximately$35million.Thesuccessofanyacquisitiondependsontheabilityofthecombined companytorealizetheanticipatedbenefitsfromcombiningourbusinesses.Realizingthesebenefitsdepends,inpart,on maintainingadequatefocusonexecutingthebusinessstrategiesofthecombinedcompanyaswellasthesuccessful integrationofassets,operations,functionsandpersonnel.Wecontinuetoevaluatepotentialacquisitiontargetsand ensurewehavearobustpipelineofpotentialopportunities.

Variousrisks,uncertaintiesandcostsareassociatedwithacquisitions.Effectiveintegrationofsystems,controls, employees,productlines,marketsegments,customers,suppliersandproductionfacilitiesandcostsavingscanbe difficulttoachieveandthesuccessofintegrationactivitiescanbeuncertain.Whilewehavenotexperiencedsignificant issueswithouracquisitionstodate,ifmanagementofourcombinedcompanyisunabletocontinueminimizingthe potentialdisruptionofthecombinedcompany’songoingbusinessduringtheintegrationprocess,theanticipatedbenefits ofanyacquisitionmaynotbefullyrealized.Inaddition,theinabilitytosuccessfullymanagetheimplementationof appropriatesystems,policies,benefitsandcomplianceprogramsforthecombinedcompanycouldhaveamaterial adverseeffectonourbusiness.Wemaynotbeabletoretainkeyemployeesofanacquiredcompanyorachievethe projectedperformancetargetsforthebusinessintowhichanacquiredcompanyisintegrated.Bothbeforeandafterthe closingofanacquisition,ourbusinessandthatoftheacquiredcompanymaysufferduetouncertaintyordiversionof managementattention.Futureacquisitionscouldresultinincreaseddebt,dilution,liabilities,interestexpense, restructuringchargesandamortizationexpensesrelatedtointangibleassets.Therecanbenoassurancethatacquisitions willbesuccessfulandcontributetoourprofitability.Further,wemaynotbeabletoidentifyvalue-accretiveacquisition targetsthatsupportourstrategyofexpandingourpositioninhighvalueproductcategoriesorbeabletosuccessfully executeadditionalacquisitionsinthefuture.

Asignificantconsolidationofourcustomerbasecouldnegativelyimpactourbusiness.

Asignificantconsolidationofourcustomerbasecouldnegativelyimpactourbusiness.Inrecentyears,some convertercustomersservedbyourMaterialsGroupreportablesegmenthaveconsolidatedandintegratedverticallyand someofourlargestcustomershaveacquiredcompanieswithsimilarorcomplementaryproductlines.Industry consolidationcouldcontinuetoincreasetheconcentrationofourbusinesswithourlargestcustomers.Further consolidationmaybeaccompaniedbypressurefromcustomersforustoloweroursellingprices.Whilewehavebeen generallysuccessfulatmanagingcustomerconsolidationsinthepast,increasedpricingpressuresfromourcustomers couldhaveamaterialadverseeffectonourbusiness.

Becausesomeofourproductsaresoldbythirdparties,ourbusinessdependsinpartonthefinancialconditionof thesepartiesandtheircustomers.

Someofourproductsaresoldnotonlybyus,butalsobythird-partydistributors.Someofourdistributorsalso marketproductsthatcompetewithourproducts.Changesinthefinancialorbusinessconditions,includingeconomic weakness,markettrendsorindustryconsolidation,orthepurchasingdecisionsofthesedistributorsortheircustomers couldmateriallyadverselyaffectourbusiness.

Ourreputation,sales,andearningscouldbemateriallyadverselyaffectedifthequalityofourproductsandservices doesnotmeetcustomerexpectations.Inaddition,productliabilityclaimsorregulatoryactionscouldmaterially adverselyaffectourbusinessandreputation.

Therearetimeswhenweexperienceproductqualityissuesresultingfromdefectivematerials,manufacturing, packagingordesign.Theseissuesareoftendiscoveredbeforeshipping,causingdelaysinshipping,delaysinthe manufacturingprocess,or,occasionally,cancelledorders.Whenissuesarediscoveredaftershipment,theymayresultin additionalshippingcosts,discounts,refundsorlossoffuturesales.Bothpre-shippingandpost-shippingqualityissues couldhaveamaterialadverseeffectonourbusinessandnegativelyimpactourreputation.

Claimsforlossesorinjuriespurportedlycausedbysomeofourproductsariseintheordinarycourseofour business.Inadditiontotheriskofsubstantialmonetaryjudgmentsandpenaltiesthatcouldhaveamaterialadverseeffect onourbusiness,productliabilityclaimsorregulatoryactionscouldresultinnegativepublicity,reputationalharmandloss ofbrandvalue.Wealsocouldberequiredtorecallandpossiblydiscontinuethesaleofproductsdeemedtobedefective orunsafe,whichcouldresultinadversepublicityandsignificantexpenses.Althoughwemaintainproductliability insurancecoverage,claimsaresubjecttoadeductibleormaynotbecoveredunderthetermsofthepolicy.

Changesinourbusinessstrategiesandtherestructuringofouroperationsaffectourcostsandtheprofitabilityofour businesses.Inaddition,ourprofitabilitymaybemateriallyadverselyaffectedifwegeneratelessproductivity improvementfromourrestructuringactionsthanprojected.

Asourbusinessenvironmentchanges,wehaveadjustedandmayneedtofurtheradjustourbusinessstrategiesor restructureouroperationsorparticularbusinesses.Aswecontinuetodevelopandadjustourgrowthstrategies,wemay investinnewbusinessesthathaveshort-termreturnsthatarenegativeorlowandwhoseultimatebusinessprospects areuncertainorcouldproveunprofitable.Weengageinrestructuringactionsfromtimetotimetoreduceourcostsand increaseefficienciesacrossourbusinesssegments.Weexpendedapproximately$79millionin2023comparedto$8 millionforrestructuringactionsin2022.Ourrestructuringactionsin2023includedarestructuringplantofurther optimizetheEuropeanfootprintofourMaterialsGroupreportablesegment.Wehadincrementalsavingsfrom restructuringactions,netoftransitioncosts,ofapproximately$69millioninfiscalyear2023.Weintendtocontinue effortstoreducecostsinallourbusinesses,whichhaveinthepastincluded,andmaycontinuetoinclude,facilityclosures andsquarefootagereductions,headcountreductions,organizationalrestructuring,processstandardization,and manufacturingrelocation.Thesuccessoftheseeffortsisnotassuredandtargetedsavingsmaynotberealized.In addition,costreductionactionscanresultinrestructuringchargesandcouldexposeustoproductionrisk,lossofsales andemployeeturnover.Wecannotprovideassurancethatwewillachievetheintendedresultsofanyofourrestructuring actions,whichinvolveoperationalcomplexities,consumemanagementattentionandrequiresubstantialresourcesand effort.Ifwefailtoachievetheintendedresultsofsuchactions,ourcostscouldincrease,ourassetscouldbeimpaired,and ourreturnsoninvestmentscouldbelower.

Ourabilitytodevelopandsuccessfullymarketnewproductsandapplicationsimpactsourcompetitiveposition.

Thetimelyintroductionofnewproductsandimprovementstocurrentproductshelpsdetermineoursuccess.Many ofourcurrentproductsaretheresultofourresearchanddevelopmentefforts,forwhichweexpensed$135.8millionin 2023.Theseeffortsaredirectedprimarilytowarddevelopingnewproductsandoperatingtechniquesandimproving productperformance,oftenincloseassociationwithourcustomersorendusers.Theseeffortsincludepatentand productdevelopmentworkrelatingtoprintingandcoatingtechnologies,aswellasadhesive,releaseandinkchemistries inMaterialsGroup.WefocusonresearchprojectsrelatedtoRFIDandexternalembellishmentsinSolutionsGroup,for whichwehaveandlicenseanumberofpatents.Additionally,ourresearchanddevelopmenteffortsincludesustainable innovationanddesignofproductsthatincreasetheuseofrecycledcontent,reducewaste,extendlifeorenablerecycling. Researchanddevelopmentiscomplexanduncertain,requiringinnovationandanticipationofmarkettrends,which meansthatthecostsoftheseexpendituresmaynotberecoveredthroughadditionalsales.Wecouldfocusonproducts thatultimatelyarenotacceptedbycustomersorendusersorwecouldexperiencedelaysintheproductionorlaunchof newproductscouldcompromiseourcompetitiveposition.

Ourinfrastructureneedsimpactourbusinessandexpenditures.

Wecontinuetoinvestinourlong-termgrowthandmarginexpansionplans,with$285.1millionincapital expenditures,includingfixedassetsandinformationtechnology,in2023.Wemaynotbeabletorecoupthecostsofour infrastructureinvestmentsifactualdemandisnotasweanticipate.Inrecentyears,weexpandedMaterialsGroup’s manufacturingcapabilitiesinIndiaandalocationinIndiana;movedourSolutionsGroup’sVietnambusinessintoanew, expandedfacility;andmadeadditionalinvestmentsinbothcapacityandbusinessdevelopmentgloballyforourIntelligent LabelsRFIDplatform,includingnewfacilitiesinBrazilandMexico.WealsotransferredMaterialsGroup’sEuropean medicalcapacityfromBelgiumtoIreland.Inaddition,weaddedcapacitythroughouracquisitionsofSilverCrystal,Lion BrothersandThermopatchin2023.Infrastructureinvestments,whicharelong-terminnature,maynotgeneratethe expectedreturnduetochangesinthemarketplace,failuresinexecution,andotherfactors.Significantchangesfromour expectedneedforand/orreturnsonourinfrastructureinvestmentscouldmateriallyadverselyaffectourbusiness.

Difficultyinthecollectionofreceivablesasaresultofeconomicconditionsorothermarketfactorscouldhavea materialadverseeffectonourbusiness.

Althoughwehaveprocessestoadministercreditgrantedtocustomersandbelieveourallowanceforcreditlosses isadequate,wehaveincreasedtheallowancedueto,forexample,epidemics,pandemicsorotheroutbreaksofillness, supplychainchallenges,issueswithrawmaterialavailabilityandcost,freightandlaboravailability,andinflationary pressures,andinthefuturemayexperiencelossesasaresultofourinabilitytocollectsomeofouraccountsreceivable.A customer’sfinancialdifficultiesarelikelytoresultinreducedbusinesswiththatcustomer.Wemayalsoassumehigher creditriskrelatingtoreceivablesofacustomerexperiencingfinancialdifficulty.Ifthesedevelopmentsweretooccur widelyinourcustomerbase,ourinabilitytocollectonouraccountsreceivablefromcustomerscouldsubstantiallyreduce ourcashflowsandincomeandhaveamaterialadverseeffectonourbusiness.

Thereisarapidlyevolvingawarenessandfocusfromstakeholders,includingourinvestors,customersand employees,withrespecttoglobalclimatechangeandourcompany’ssustainabilityandgovernancepractices,which couldaffectourbusiness.

Investorandsocietalexpectationswithrespecttosustainabilityorgovernancemattershavebeenevolvingand increasing.Weriskdamagetoourreputationifwedonotcontinuetoactresponsiblywithrespecttothesemattersinthe followingkeyareas:environmentalstewardship;DEI;corporategovernance;supportforourcommunities;and transparency.Afailuretoadequatelymeetstakeholders’expectationscouldresultinlossofbusiness,dilutedmarket valuation,aninabilitytoattractandretaincustomersandpersonnel,increasednegativeinvestorsentimenttowardus and/orourcustomersandthediversionofinvestmenttootherindustries,whichcouldhaveanegativeimpactonour stockpriceandaccesstoandcostofcapital.

Epidemics,pandemicsorotheroutbreaksofillness,andrestrictionsintendedtopreventtheirspread,couldmaterially adverselyimpactourbusiness.

Epidemics,pandemicsorotheroutbreaksofillness,diseaseorvirusinthemarketsinwhichwedobusiness,and actionstakentocontainorpreventtheirfurtherspread,couldmateriallyimpactourbusiness,astheydidatvarioustimes duringthe2020-2023period.Theycouldresultinrestrictivegovernmentalmeasuresbeingimplementedtocontroltheir 12 2023AnnualReport | AveryDennisonCorporation

spread,includingquarantines,restrictionsontravel,“shelterinplace”rules,stay-at-homeorders,densitylimitations, socialdistancingmeasures,and/orrestrictionsontypesofbusinessthatmaycontinuetooperate,whichcouldmaterially adverselyaffectourbusiness.

RisksRelatedtoInformationTechnology

Significantdisruptiontotheinformationtechnologyinfrastructurethatstoresourinformationcouldmaterially adverselyaffectourbusiness.

Werelyontheefficientanduninterruptedoperationofalargeandcomplexinformationtechnologyinfrastructure tolinkourglobalbusiness.Likeallinformationtechnologysystems,oursaresusceptibletoanumberofrisksincluding, butnotlimitedto,damageorinterruptionsresultingfromobsolescence,naturaldisasters,powerfailures,humanerror, viruses,socialengineering,phishing,ransomwareorothermaliciousattacksanddatasecuritybreaches.Weupgradeand installnewsystems,which,ifinstalledorprogrammedincorrectlyoronadelayedtimeframe,couldcausedelaysor cancellationsofcustomerorders,impedethemanufactureorshipmentofproducts,ordisrupttheprocessingof transactions.Wehavecontinuedtoimplementmeasurestomitigateourriskrelatedtosystemandnetworkdisruptions, butifasignificantdisruptionweretooccur,wecouldincursignificantlossesandremediationcoststhatcouldhavea materialadverseeffectonourbusiness.

Additionally,werelyonservicesprovidedbythird-partyvendorsforcertaininformationtechnologyprocesses, includingsysteminfrastructuremanagement,applicationmanagement,andsoftwareasaservice.Whilewehave maturedourcybersecurityduediligenceprocess,thisrelianceonthirdpartiesmakesouroperationsvulnerabletoafailure byanyoneofthesevendorstoperformadequatelyormaintaineffectiveinternalcontrols.

Cybersecurityorothersecuritybreachescouldcompromiseourinformationandexposeustoliability,whichcould haveamaterialadverseeffectonourbusinessandreputation.

Wemaintaininformationnecessarytoconductourbusinessindigitalform,whichisstoredindatacentersandon ournetworksandthird-partycloudservices,includingconfidentialandproprietaryinformationaswellaspersonal informationregardingourcustomersandemployees.Thesecuremaintenanceofthisinformationiscriticaltoour operations.Datamaintainedindigitalformissubjecttotheriskofintrusion,tamperingandtheft.Wedevelopand maintainsystemsandprocessesatsignificantcosttopreventthisfromoccurring,butthesesystemsrequireongoing monitoringandupdatingastechnologieschangeandeffortstoovercomesecuritymeasuresbecomemoresophisticated. Weexperiencenon-materialcybersecurityeventseachyearthatareescalatedthroughourdocumentedandtested SecurityIncidentResponsePlan,andalthoughwehavenotexperiencedasignificantbreachinrecentyears,the possibilityofintrusion,tamperingandtheftcannotbeeliminatedentirely.Ourinformationtechnologyandinfrastructure arevulnerabletoattacksbyhackersorbreachesduetoemployeeerror,malfeasanceorotherdisruptions,andthethreat landscaperemainschallengingwithourdigitalbusinesstransformation,hybridworkforces,theincreasinguseofartificial intelligence,andinterconnectedsupplychainsexpandingtheriskofattack.Wealsoperformcybersecurityduediligence andmitigateidentifiedrisksduringourM&Aduediligenceprocess;however,thereisstillariskthatarecentorfuture acquisitionexperiencesaneventthatcouldleadtoabreachbeforerisksareabletobemitigated.

Additionally,weprovideconfidential,proprietaryandpersonalinformationtothirdpartieswhenitisnecessaryto pursuebusinessobjectives.Whileweobtainwrittenagreementsandassurancesthatthesethirdpartieswillprotectthis informationand,whereappropriate,assesstheprotectionsutilizedbythesethirdparties,weareawareofsuppliersinour ecosystemwhohaveexperiencedsecurityevents,andthereisarisktheconfidentialityofdataheldbythirdpartiesmay becompromised.

Breachesorattackscancompromiseournetwork,thenetworkofathirdpartytowhomwehavedisclosed confidential,proprietaryorpersonalinformation,adatacenterwherewehavestoredsuchinformationorathird-party cloudserviceprovider,andtheinformationstoredtherecanbeaccessed,publiclydisclosed,lostorstolen.Anyaccess, disclosureorlossofinformationcoulddisruptouroperations,resultinlegalclaimsorproceedings,damageour reputation,impairourabilitytoconductbusiness,orresultinthelossordiminishedvalueofprofitableopportunitiesand thelossofrevenueasaresultofunlicenseduseofourintellectualproperty.Contractualprovisionswiththirdparties, includingcloudserviceproviders,oftensubstantiallylimitourabilitytofullyrecoverourlosses.Ifthepersonalinformation ofourcustomersoremployeesweretobemisappropriated,wecouldincurcoststocompensateourcustomersor employeesorpaydamagesorfinesasaresultoflitigationorregulatoryactionsandourreputationwithourcustomers

andemployeescouldbeinjured,resultinginlossofbusinessordeclineinmorale.Dataprivacylegislationandregulation havebeenincreasinginrecentyears–including,forexample,theGeneralDataProtectionRegulationintheEU,the PersonalInformationProtectionLawinChina,theGeneralDataProtectionLawinBrazilandthestateofCalifornia’s PrivacyRightsAct–andalthoughwehavemadereasonableeffortstocomplywithallapplicablelawsandregulations, therecanbenoassurancethatwewillnotbesubjecttoregulatoryactionintheeventofadataprivacyviolation.

Cybersecurityriskandransomwareattacksoncompaniescontinuetosignificantlyincreaseandtherecanbeno assurancethatwehavefullyprotectedourinformation,thatthirdpartiestowhomwehavedisclosedsuchinformationor withwhomwehavestoredsuchinformation(indatacentersandinthecloud)aretakingsimilarprecautions,orthatwe willnotexperiencehackingorintrusionattemptsthatcouldhaveamaterialadverseeffectonourbusiness.Inadditionto maintainingarobustsetofendpoint,network,emailandcloudsecuritysolutions,wecontinuetotakestepstofurther improvethesecurityofournetworksandcomputersystems,includingstrengtheningauthentication;continuingtomature ourzerotrustarchitectureandstrategy;furtheringouradvancedmalwaredetectionmeasures;furtherenhancingand testingoursecurityincidentresponseplan;upgradinglegacyinformationtechnologysystemstosimplifyandstandardize businessprocessesandapplications;adoptingarobustcloudsecuritystrategyacrossmultipleplatforms;continuously improvinginformationtechnologyprojectandportfoliomanagementdiscipline;settingmoreaggressivekeyperformance indicatortargetsandimplementingappropriatemitigationmeasures;continuingtomatureourdatalossprevention frameworktoprotectourcriticaldata,networkandsiteaccesscontrols;advancingouruseraccessmanagement program;limitingUSBdriveaccessacrossourcompany;increasingnetworksegmentation;enhancingourfocusonthird partyriskmanagement;andimprovingourcapabilitiesbasedonthreatintelligenceandthepublicizedincidents experiencedbyothercompanies,aswellasonesthatwehaveexperienceddespitetheirminimaloperationalorfinancial impacttodate.

RisksRelatedtoIncomeTaxes

Changesinourtaxratesaffectourbusiness.

Oureffectivetaxrateisaffectedbychangesinthemixofearningsincountrieswithdifferingstatutorytaxrates, changesinthevaluationofdeferredtaxassetsandliabilities,orchangesintaxlawsandregulationsortheir interpretation.Theimpactofthesechangescouldmateriallyimpactourbusiness.

Legislationimplementingchangesintaxationofbusinessactivities,adoptionofothercorporatetaxreformpolicies, orotherchangesintaxlegislationorpoliciesimpactourexpenses.

Corporatetaxreform,preventionofbase-erosionandtaxtransparencycontinuetobehighprioritiesformanytax jurisdictionsworldwide,includingtheU.S.Asaresult,policiesregardingcorporateincomeandothertaxesareunder heightenedscrutinyglobally,withtaxreformlegislationhavingbeenproposedorenactedinanumberofjurisdictions.

Inaddition,manycountrieshaveenacted,orplantoenact,legislationandotherguidancetoaligntheir internationaltaxruleswiththeOrganisationforEconomicCo-operationandDevelopment’s(“OECD”)BaseErosionand ProfitShiftingrecommendationsanddirectives,whichaimtostandardizeandmodernizeglobalcorporatetaxpolicy, cross-bordertax,transfer-pricingdocumentationrules,andnexus-basedtaxincentivepractices.Moreover,theOECD continuestofocusonfundamentalchangestotheprofitallocationamongtaxjurisdictionsinwhichcompaniesdo businessandtheimplementationofaglobalminimumtax.Thetimingandultimateimpactofsuchchangesonour effectivetaxrateremainuncertainasthecountriesinwhichweoperatecontinuetoadoptthesedirectives.Duetothe sizeofourinternationalbusinessactivities,anysubstantialchangeincorporatetaxpolicies,enforcementactivitiesor legislativeorregulatoryactionscouldhaveamaterialadverseeffectonourbusiness.

Ourinabilitytoretainorrenewcertaintaxincentivesinforeignjurisdictionscouldmateriallyadverselyaffectour effectivetaxrate.

Oureffectivetaxratereflectsbenefitsfromconcessionarytaxratesincertainforeignjurisdictionsbasedonthe geographiclocationofourmanufacturingactivities,theindustriesthatweserve,orthebusinessmodelunderwhichwe operate.Ifwedonotmeetthecriteriarequiredtoretainorrenewthesetaxincentives,oureffectivetaxratecouldbe materiallyadverselyaffected.

Theamountofvarioustaxeswepayissubjecttoongoingcompliancerequirementsandauditsbyfederal,stateand foreigntaxauthorities.

Wearesubjecttoregularexaminationsofourincometaxreturnsbyvarioustaxauthorities.Weregularlyassess thelikelihoodofmaterialadverseoutcomesresultingfromtheseexaminationstodeterminetheadequacyofourprovision fortaxes.Inaddition,taxenforcementhasbecomeincreasinglyaggressiveinrecentyearsfocusedprimarilyontransfer pricingandintercompanydocumentation.Ourestimateofthepotentialoutcomeofuncertaintaxissuesrequires significantjudgmentandissubjecttoourassessmentofrelevantrisks,facts,andcircumstancesexistingatthetime.We usetheseassessmentstodeterminetheadequacyofourprovisionforincometaxesandothertax-relatedaccounts.Our resultsmayincludefavorableorunfavorableadjustmentstoourestimatedtaxliabilitiesintheperiodtheassessmentsare madeorresolved,whichmaymateriallyadverselyaffectoureffectivetaxrate.

Wehavedeferredtaxassetsthatwemaynotbeabletorealizeundercertaincircumstances.

Ifweareunabletogeneratesufficienttaxableincomeincertainjurisdictions,orifthereisasignificantchangein thetimeperiodwithinwhichtheunderlyingtemporarydifferencesbecometaxableordeductible,wecouldberequiredto increaseourvaluationallowancesagainstourdeferredtaxassets.Thiswouldincreaseoureffectivetaxrateandcould haveamaterialadverseeffectonourbusiness.Inaddition,changesinstatutorytaxratesmaychangeourdeferredtax assetorliabilitybalances,witheitherafavorableorunfavorableimpactonoureffectivetaxrate.Asignificantportionof ourindefinite-livednetoperatinglosscarryforwardsisconcentratedinLuxembourgandmayrequiredecadestobefully utilizedunderourcurrentbusinessmodel.Decreasesinthestatutorytaxrateorchangesinourabilitytogenerate sufficientfuturetaxableincomeinLuxembourgcouldmateriallyadverselyaffectoureffectivetaxrate.Inaddition,the computationandassessmentoftherealizabilityofourdeferredtaxassetsmayalsobemateriallyimpactedbynew legislationorregulations.

RisksRelatedtoHumanCapital

Forustoremaincompetitive,deliveronourbusinessstrategyandavoidbusinessdisruption,itisimportanttorecruit highcalibertalent,retainkeymanagementandhighly-skilledemployeesandreceivehighqualityservicefromall outsourcedserviceproviders.Thisincludesprovidingmarket-competitivecompensationandbenefitsandensuringa diverse,equitableandinclusiveworkplace.

Competitiontorecruitandretaincriticaltalenthasincreasedinrecentyears.Ourongoingproductivityeffortsand restructuringactionscanincreasethischallenge.Whenitcomestoouroutsourcedserviceproviders,wehave experienceddelaysorerrorsandreducedresourceavailabilityandmanageongoingriskwhenitcomestopeople, processesandsoftware.Wealsohaveincreasedourfocusonrisksrelatedtoartificialintelligence.

Executivesuccessionplanningisalsocriticaltoourlong-termsuccess.Weexperiencedseveralrecentkey managementchanges,includingpromotionsin2023oflong-servingandexperiencedleaderstothepositionsof PresidentandChiefExecutiveOfficerandourPresident,SolutionsGroup.Whilewebelievewehaveappropriate leadershipdevelopmentprogramsandsuccessionplansinplacethatareregularlydiscussedwithourBoard’sTalentand CompensationCommittee,anyfailuretoensureeffectiveleadershiptransitionsandknowledgetransferinvolvingkey management(oranyhighly-skilledemployees)couldhinderourstrategicplanningandexecution.

Wehavevariousnon-U.S.collectivelaborarrangements,whichmakeussubjecttopotentialworkstoppages,aswell asunionandworkscouncilcampaignsandotherlabordisputes,anyofwhichcouldadverselyimpactourbusiness.

Workinterruptionsorstoppagescouldsignificantlyimpactourabilitytodeliverforourcustomers.Inaddition, collectivebargainingagreements,unioncontractsandlaborlawsmayimpairourabilitytoreducelaborcostsbyclosingor downsizingmanufacturingfacilitiesbecauseoflimitationsonpersonnelandsalaryandotherrestrictions.Awork stoppageatoneormoreofourfacilities,orthefacilitiesofourcustomersoratanyofoursuppliers,couldhaveamaterial adverseeffectonourbusiness.

Inaddition,therecentandongoinggeopoliticalunrestandweather-relatedeffectsofclimatechangeinnumerous regionscouldimpactthesafetyandproductivityofourcurrentemployees.Thoseimpactscouldalsohinderourabilityto recruitandgrowourtalentpoolsintheimpactedregions/countries.

RisksRelatedtoOurIndebtedness

Ifourindebtednessincreasessignificantlyorourcreditratingsaredowngraded,wemayhavedifficultyobtaining acceptableshort-andlong-termfinancing.

AtDecember30,2023,wehadapproximately$3.24billionofdebt.Ourlevelofindebtednessandcreditratings aresignificantfactorsinourabilitytoobtainshort-andlong-termfinancing.Higherdebtlevelscouldnegativelyimpact ourabilitytosupportourbusinessneedsandresultinhigherfinancingcosts.Thecreditratingsassignedtousalso impacttheinterestrateswepay.Adowngradeofourshort-termcreditratingscouldimpactourabilitytoaccessthe commercialpapermarketsandincreaseourborrowingcostsifweneededtoobtainshort-termfundingunderour revolvingcreditfacility.Ifouraccesstocommercialpapermarketsweretobecomelimitedandwewererequiredto obtainshort-termfundingunderourrevolvingcreditfacilityorourothercreditfacilities,wewouldhaveincreased exposuretovariableinterestrates.

Anincreaseininterestratesadverselyaffectsourbusiness.

In2023,ouraveragevariable-rateborrowingswereapproximately$608million.Increasesinshort-terminterest ratesdirectlyimpacttheamountofinterestwepay.Fluctuationsininterestratescanincreaseourborrowingcostsand haveamaterialadverseeffectonourbusiness.

Since2022,theU.S.FederalReserveandsimilarmonetarypolicymakingentitiesaroundtheworldhaveraised interestratesinanefforttocurbrisinginflationacrosstheglobe.AsofDecember30,2023,theU.S.FederalReserve’s benchmarkinterestratewasbetween5.25%and5.50%,upfrombetween4.25%and4.50%thesametimein2022.As long-terminterestratesrise,ourborrowingcostsincrease.Continuedincreasesininterestratescould,amongother things,reducetheavailabilityand/orincreasethecostsofobtainingnewdebtandrefinancingexistingindebtednessand negativelyimpactourbusiness.

Ourcurrentandfuturedebtcovenantsmaylimitourflexibility.

Ourcreditfacilitiesandtheindenturesgoverningourmedium-andlong-termnotescontain,andanyofourfuture indebtednesslikelywouldcontain,restrictivecovenantsthatimposeoperatingandfinancialrestrictionsonus.Among otherthings,thesecovenantsrestrictourabilitytoincuradditionalindebtedness,incurcertainliensonourassets,make certaininvestments,sellourassetsormergewiththirdparties,orenterintocertaintransactions.Wearealsorequiredto maintainspecifiedfinancialratiosundercertainconditions.Theserestrictivecovenantsandratiosmaylimitorprohibitus fromengagingincertainactivitiesandtransactionsthatmaybeinthebestinterestofourbusiness,puttingusata competitivedisadvantagerelativetoourcompetitors,whichcouldmateriallyadverselyaffectourbusiness.

RiskRelatedtoOwnershipofOurStock

Ourstockpriceissubjecttosignificantvariability.

Changesinourstockpricemay,amongotherthings,affectouraccessto,orcostoffinancingfrom,capital markets,ourstock-basedcompensationarrangementsandoureffectivetaxrate.Ourstockpriceisinfluencedbychanges intheoverallstockmarketanddemandforequitysecuritiesingeneral.Otherfactors,includingourfinancialperformance onanabsolutebasisandrelativetopeercompaniesandcompetitors,aswellasmarketexpectationsofourperformance, thelevelofperceivedgrowthofourindustries,andothercompany-specificfactors,mayalsomateriallyadverselyaffect ourstockprice.Therecanbenoassurancethatourstockpricewillnotcontinuetoexperiencesignificantvariabilityinthe future.

Wecannotguaranteethatwewillcontinuetorepurchasesharesofourcommonstockorpaydividendsonour commonstockorthatrepurchaseswillenhancelong-termstockholdervalue.Changesinourlevelsofstock repurchasesordividendscouldaffectourstockpriceandincreaseitsvariability.

InApril2022,ourBoardauthorizedtherepurchaseofsharesofourcommonstockwithafairmarketvalueofupto $750million,inadditiontotheamountofsharesthatwerethenavailableforrepurchaseunderourpreviousBoard authorization.In2023,werepurchased0.8millionsharesofourcommonstockatanaggregatecostof$137.5million.As ofDecember30,2023,sharesofourcommonstockintheaggregateamountof$592.8millionremainedauthorizedfor repurchaseunderthisBoardauthorization.Wemakesharerepurchasesthroughavarietyofmethods,whichmayinclude 16 2023AnnualReport | AveryDennisonCorporation

openmarketpurchases,privatelynegotiatedtransactions,blocktradesoracceleratedsharerepurchasetransactions.Our sharerepurchaseauthorizationsdonotobligateustoacquireanyspecificnumberofsharesortorepurchaseanyspecific numberofsharesforanyfixedperiod.Thetimingandamountofourrepurchases,ifany,aresubjecttomarketand economicconditions,applicablelegalrequirementsandotherrelevantfactors.Wemaylimit,suspendordiscontinue repurchasingsharesatanytimeatourdiscretionandwithoutpriornotice.

Althoughweincreasedourquarterlydividendratebyapproximately8%inApril2023,therecanbenoassurance thatwewillmaintainthisrateorapprovefurtherincreasesinthefuture.Futuredividendsaresubjecttomarketand economicconditions,applicablelegalrequirementsandotherrelevantfactors.Wearenotobligatedtocontinuedeclaring dividendsforanyfixedperiod,andourpaymentofdividendscouldbesuspendedordiscontinuedatanytimeatour discretionandwithoutpriornotice.Wewillcontinuetoretainfutureearningstodevelopourbusiness,asopportunities arise,andevaluatetheamountandtimingoffuturedividendsbasedonouroperatingresults,financialcondition,capital allocationstrategiesandgeneralbusinessconditions.Theamountandtimingofanyfuturedividendsmayvary,andthe paymentofanydividenddoesnotassurethatwewillpaydividendsinthefuture.

Inaddition,anyfuturerepurchasesofourcommonstockorpaymentofdividends,oranydeterminationtocease repurchasingstockorpayingdividends,couldaffectourstockpriceandsignificantlyincreaseitsvariability.Ourshare repurchasesandanyfuturedividendscouldcauseourstockpricetobehigherthanitwouldotherwisebeandcould potentiallyreducethemarketliquidityforourstock.Additionally,anyfuturerepurchasesofourcommonstockorpayment ofdividendscouldimpactourabilitytoinvestinourbusinessesorpursueacquisitionsandventureinvestments.Although oursharerepurchaseprogramisintendedtoenhancelong-termstockholdervalue,thereisnoassurancethatitwilldoso becausethemarketpriceofourcommonstockmaydeclinebelowthelevelsatwhichwerepurchasedsharesofstock andshort-termstockpricefluctuationscouldreducetheprogram’seffectiveness.

RisksRelatedtoLegalandRegulatoryMatters

Infringingintellectualpropertyrightsofthirdpartiesorinadequatelyacquiringorprotectingourintellectualproperty couldharmourabilitytocompeteorgrow.

Becauseourproductsinvolvecomplextechnologyandchemistry,weareinvolvedfromtimetotimeinlitigation involvingpatentsandotherintellectualproperty.Partieshavefiled,andinthefuturemayfile,claimsagainstusalleging thatwehaveinfringedtheirintellectualpropertyrights.WearecurrentlypartytoalitigationinwhichADASAInc. (“Adasa”),anunrelatedthirdparty,allegedthatcertainofourRFIDproductswithinourSolutionsGroupreportable segmentinfringeditspatent.AsofDecember30,2023ourcontingentliabilityforthismatterwas$82.9millionwhich reflectsourbestestimateoftheanticipatedjudgment.Formoreinformationonthislitigation,seeNote8, “Contingencies,”intheNotestoConsolidatedFinancialStatements.Ifweareunsuccessfulinourappealsrelatedtothe Adasamatterorareheldliableforinfringementinothermatters,wecouldberequiredtopaydamages,obtainlicensesor ceasemakingorsellingcertainproducts.Therecanbenoassurancethatlicenseswouldbeavailableoncommercially reasonabletermsoratall.Thedefenseoftheseclaims,whetherornotmeritorious,orthedevelopmentofnew technologiesiscostlyanddivertstheattentionofmanagement.

Wealsohavevaluableintellectualpropertyuponwhichthirdpartiesmayinfringe.Weattempttoprotectand restrictaccesstoourintellectualpropertyandproprietaryinformationbyrelyingonthepatent,trademark,copyrightand tradesecretlawsoftheU.S.andothercountries,aswellasnon-disclosureagreements.However,itmaybepossiblefora thirdpartytoobtainourinformationwithoutourauthorization,independentlydevelopsimilartechnologies,orbreacha non-disclosureagreemententeredintowithus.Inaddition,manyofthecountriesinwhichweoperatedonothave intellectualpropertylawsasprotectiveasthoseintheU.S.Theuseofourintellectualpropertybysomeoneelsewithout ourauthorizationcouldreduceoreliminatecertaincompetitiveadvantageswehave,causeustolosesalesorotherwise harmourbusiness.Further,thecostsassociatedwithprotectingourintellectualpropertyrightscouldmateriallyadversely impactourbusiness.

WehaveobtainedandappliedforU.S.andforeigntrademarkregistrationsandpatents,andwillcontinueto evaluatewhethertoregisteradditionaltrademarksandapplyforadditionalpatents.Wecannotguaranteethatanyofour pendingapplicationswillbeapprovedbytheapplicablegovernmentalauthorities.Further,wecannotassurethatthe validityofourpatentsorourtrademarkswillnotbechallenged.Inaddition,thirdpartiesmaybeabletodevelop competingproductsusingtechnologythatavoidsourpatents.

Unfavorabledevelopmentsinlegalproceedings,investigationsandotherlegalandregulatorymatters,couldimpact usinamateriallyadversemanner.

Therecanbenoassurancethatanyoutcomeofanylitigation,investigationorotherlegal,environmental, complianceandregulatorymatterwillbefavorable.Ourfinancialresultscouldbemateriallyadverselyaffectedbyan unfavorableoutcometopendingorfuturelitigationandinvestigations,andotherlegal,regulatory,environmentaland compliancematters.SeeNote8,“Contingencies,”intheNotestoConsolidatedFinancialStatementsformore information.

Wearerequiredtocomplywithanti-corruptionandothercompliancelawsandregulationsoftheU.S.government andvariousinternationaljurisdictions,andourfailuretocomplywiththeselawsandregulationscouldhavea materialadverseeffectonourbusiness.

Wearerequiredtocomplywiththeanti-corruptionandothercompliancelawsandregulationsoftheU.S. governmentandvariousinternationaljurisdictions,suchastheU.S.ForeignCorruptPracticesActandtheUK’sBribery Actof2010.Ifwefailtocomplywithanti-corruptionlaws,wecouldbesubjecttosubstantialcivilandcriminalpenalties, includingfines,monetarydamagesandincarcerationforresponsibleemployeesandmanagers.Inaddition,ifour distributorsoragentsfailtocomplywiththeselaws,ourbusinessmayalsobemateriallyadverselyaffectedthrough reputationalharmandpenalties.

Wearerequiredtocomplywithenvironmental,health,andsafetylawsatouroperationsaroundtheworld.Thecosts ofcomplyingwiththeselawsissignificantandincreasing.

Wearesubjecttonational,state,provincialand/orlocalenvironmental,health,andsafetylawsandregulationsin theU.S.andothercountriesinwhichweoperate,includingthoserelatedtothedisposalofhazardouswasteandGHG emissionsfromourmanufacturingprocesses.Theselaws,whicharecontinuallyevolvingandimposingadditional requirementsonourcurrentandformermanufacturingfacilities,imposeliabilityforthecostsof,anddamagesresulting from,cleaningupcurrentsites,pastspills,disposalsandotherreleasesofhazardoussubstances.Enforcementofthese lawscanbeunclearandissubjecttothediscretionofgovernmentalagencies.Anyfailuretocomplywithexistingand futureenvironmental,healthandsafetylawscouldsubjectustofees,penalties,costsorliabilities,impactourproduction capabilities,limitourabilitytosell,expandoracquirefacilities,andhaveamaterialadverseeffectonourbusiness.Laws andregulationsrelatedtotheenvironment,productcontentandproductsafetyarecomplex,changeoften,andcanbe opentodifferentinterpretations.Inaddition,wecouldbemateriallyandadverselyimpactedbyanyenvironmentalor productsafetyenforcementactionaffectingoursuppliers,particularlyinemergingmarkets.

Wehaveaccruedliabilitiesfortheenvironmentalclean-upofcertainsites,includingtheelevensitesforwhichU.S. governmentalagencieshavedesignatedusasapotentiallyresponsiblepartyasofour2023fiscalyear-end,whereitis probablethatalosswillbeincurredandthecostoramountoflosscanbereasonablyestimated.SeeNote8, “Contingencies,”intheNotestoConsolidatedFinancialStatementsformoreinformation.However,becauseofthe uncertaintiesassociatedwithenvironmentalassessmentandremediationactivities,theactualexpensetoremediate currentlyidentifiedsitescouldbehigherthantheliabilitiesaccruedandadditionalsitescouldbeidentifiedinthefuture.

Wearesubjecttoexportandimportcontrollawsandregulationsinthejurisdictionsinwhichwedobusinessthat couldsubjectustoliabilityorimpairourabilitytocompeteinthesemarkets.

Exportcontrollawsandeconomicsanctionsprohibittheshipmentofsomeofourproductstoembargoedor sanctionedcountries,governmentsandpersons.Whilewetrainouremployeestocomplywiththeseregulations,use thirdpartyscreeningsoftware,andtakeothermeasures,wecannotguaranteethataviolationwillnotoccur.Aprohibited shipmenthasnegativeconsequences,includinggovernmentinvestigations,penalties,fines,civilandcriminalsanctions and/orreputationalharm.Anychangeinexportorimportregulations,economicsanctionsorrelatedlegislation,shiftin theenforcementorscopeofexistingregulations,orchangeinthecountries,governments,personsortechnologies targetedbysuchregulations,coulddecreaseourabilitytoexportorsellourproductsinternationally.Anylimitationonour abilitytoexportorsellourproductscouldmateriallyadverselyaffectourbusiness.

Someofourproductsaresubjecttoexportcontrollawsandregulationsandmaybeexportedonlywithanexport licenseorthroughanapplicableexportlicenseexception.Ifwefailtocomplywithexportlicensing,customsregulations, economicsanctionsorotherlaws,wecouldbesubjecttosubstantialcivilorcriminalpenalties,includingfines,criminal 18 2023AnnualReport | AveryDennisonCorporation

chargesagainstresponsibleemployeesandlossofexportorimportprivileges.Inaddition,ifourdistributorsfailtoobtain appropriateimport,exportorre-exportlicensesorpermits,wemayalsobemateriallyadverselyaffectedthrough reputationalharmandpenalties.Obtainingthenecessaryexportlicenseforaparticularsalemaybetimeconsumingand expensiveandcouldresultinthedelayorlossofsalesopportunities.

RisksRelatedtoOtherFinancialMatters

Ourpensionassetsaresignificantandsubjecttomarket,interestandcreditriskthatmayreducetheirvalue.

Changesinthevalueofourpensionassets,whichwasapproximately$663millionasofDecember30,2023, couldmateriallyadverselyaffectourearningsandcashflows.Inparticular,thevalueofourinvestmentsmaydeclinedue toincreasesininterestratesorvolatilityinfinancialmarkets.Wecontinuouslyevaluateoptionstobettermanagethe volatilityassociatedwithourpensionliabilitiesandmaytakeactionstoreducethefinancialvolatilityassociatedwithour pensionliabilities,whichcouldresultinsignificantcharges.Althoughwemitigatetheserisksbyinvestinginhighquality securities,ensuringadequatediversificationofourinvestmentportfolioandmonitoringourportfolio’soverallriskprofile, thevalueofourinvestmentsmayneverthelessdecline.

Theactuarialassumptionsusedforvaluationpurposesaffectourearningsandcashflows.Changesinaccounting standardsandgovernmentregulationscouldalsoaffectourpensionandpostretirementplanexpenseandfunding requirements.

Weevaluatetheassumptionsusedindeterminingprojectedbenefitobligationsandthefairvalueofplanassets forournon-U.S.pensionplansandotherpostretirementbenefitplansinconsultationwithoutsideactuaries.Ourpension andprojectedpostretirementbenefitexpensesandfundingrequirementsincreaseordecreaseasaresultofthe assumptionsweuse,includingthediscountrate,expectedlong-termrateofreturnormortalityrates.Becauseof changingmarketconditionsorchangesinparticipantpopulations,theactuarialassumptionsthatweusemaydifferfrom actualresults,whichcouldhaveasignificantimpactonourpensionandpostretirementbenefitobligationsandrelated costs.Fundingobligationsforeachplanaredeterminedbasedonthevalueofassetsandliabilitiesonaspecificdatein accordancewithapplicablegovernmentregulations.Ourpensionfundingrequirements,andthetimingoffunding payments,couldalsobeaffectedbyfuturelegislationorregulation.In2023,theDutchSenatepassedtheDutchPension Act,whichrequirestraditionaldefinedbenefitplanstobephasedoutandtransitiontodefinedcontributionplansby January1,2028.

Animpairmentinthecarryingvalueofgoodwillcouldnegativelyimpactourresultsofoperationsandnetworth.

Goodwillisinitiallyrecordedatfairvalueandnotamortizedandisreviewedforimpairmentannually(ormore frequentlyifimpairmentindicatorsarepresent).AsofDecember30,2023,thecarryingvalueofourgoodwillwas$2.01 billion.In2023,wedeterminedthatthegoodwillofourreportingunitswasnotimpaired.Wereviewgoodwillfor impairmentbycomparingthefairvalueofareportingunittoitscarryingvalue.Inassessingfairvalue,wemakeestimates andassumptionsaboutsales,operatingmargins,growthrates,anddiscountratesbasedonourbusinessplans,economic projections,anticipatedfuturecashflowsandmarketplacedata.Thereareinherentuncertaintiesrelatedtothesefactors andmanagement’sjudgmentinapplyingthesefactors.Goodwillvaluationshavebeencalculatedprimarilyusingan incomeapproachbasedonthepresentvalueofprojectedfuturecashflowsofeachreportingunit.Wecouldberequired toevaluatethecarryingvalueofgoodwillpriortotheannualassessmentifweexperiencedisruptionstoourbusiness, unexpectedsignificantdeclinesinoperatingresults,divestitureofasignificantcomponentofourbusinessorsustained marketcapitalizationdeclines.Thesetypesofeventscouldresultingoodwillimpairmentchargesinthefuture. Impairmentchargescouldmateriallyadverselyaffectourbusinessintheperiodsinwhichtheyaremade.

Item1B.UNRESOLVEDSTAFFCOMMENTS

None.

Item1C.CYBERSECURITY

CybersecurityRiskManagementandStrategy

Ourcybersecurityriskmanagement(“CSRM”)program,whichisdesignedtoprotecttheconfidentiality,integrity andavailabilityofourcriticalsystemsandinformation,includesacomprehensivecybersecurityincidentresponseplan.

WedesignandassessourprogrambasedontheISO27000andtheNationalInstituteofStandardsand Technology(NIST)SP-800andCybersecurityFramework(“CSF”).Weusetheseframeworkstohelpusidentify,assess andmanagecybersecurityrisksrelevanttoourbusiness.Itisnotintendedtosuggestthatwemeetanyparticular technicalstandards,specificationsorrequirements.

OurCSRMprogramcomplementsouroverallenterpriseriskmanagementprogram,usingsimilarmethodologies andgovernanceprocessestoidentifyrisksandmitigatingstrategies.

OurCSRMprogramincludesriskassessmentsdesignedtohelpidentifypotentiallymaterialcybersecurityrisksto ourcriticalsystems,information,productsandservices,aswellasourbroaderenterpriseITenvironment;anITsecurity teamprincipallyresponsibleformanagingourcybersecurityriskassessmentprocesses,securitycontrolsandresponseto anycybersecurityevents;theuseofthirdpartyexpertsandserviceproviders,whereappropriate,toassess,testand otherwiseassistwithprotectingoursecurityenvironment;cybersecurityawarenesstrainingforouremployeesand furthertrainingforourincidentresponsepersonnelandseniormanagement;acybersecurityincidentresponseplanthat includesproceduresforassessingandcoordinatingourresponsetocybersecurityevents;andathird-partyrisk managementprocessforserviceproviders,suppliersandvendors.

Wehavenotexperiencedcybersecurityeventsthathavemateriallyaffectedouroperations,resultsofoperations, orfinancialcondition.However,wefacecertainongoingrisksfromcybersecuritythreatsthat,ifrealized,wouldbe reasonablylikelytomateriallyaffectus,includingouroperations,resultsofoperations,orfinancialcondition.

Risksanduncertaintiesrelatedtocybersecurityarediscussedingreaterdetailunder“RisksRelatedtoInformation Technology”inItem1Aofthisreport.

CybersecurityGovernance

OurBoardofDirectors(our“Board”)considerscybersecurityriskaspartofitsriskoversightfunctionandhas delegatedtotheAuditCommitteeprimaryresponsibilityforoverseeingourCSRMprogramandengagingwith managementoncybersecurityandotherrisksrelatedtoourITcontrolsandsecurityatleasttwiceperyear.Management updatestheAuditCommittee,ifandasneeded,regardinganysignificantcybersecurityevents,aswellaseventsthatmay havehadlesserpotentialimpact.

InadditiontoreportsfromitsChairontheAuditCommittee’sdiscussionsoncybersecurity,ourBoardmembers receiveperiodicpresentationsoncybersecuritytopicsfromourChiefInformationOfficerandourInformationSecurity Officer(“ISO”)aspartoftheircontinuingeducationonrisksimpactingpubliccompanies.

Ourcybersecurityleadershipteam(“CSLT”),whichincludesleadersaccountableforsecurityoperations,incident response,riskandcompliance,datasecurity,applicationsecurity,digitalsolutionssecurity,vulnerabilitymanagementand operationaltechnologysecurity,isresponsibleforassessingandmanagingourrisksfromcybersecuritythreats.Theteam hasprimaryresponsibilityforouroverallCSRMprogramandsupervisesbothourinternalcybersecuritypersonnelandour externalcybersecurityconsultants.Informationsecuritypersonnelmaintainavarietyoftechnicalandmanagerialsecurity certificationsandhavebroadsecurityexperienceinmanufacturing,finance,softwareandITenvironments.

TheCSLTsupervisesoureffortstoprevent,detect,mitigateandremediatecybersecurityrisksandincidents throughavarietyofmeans,whichmayincludebriefingsfrominternalsecuritypersonnel;threatintelligenceandother informationobtainedfromgovernmental,publicorprivatesources,includingexternalconsultants;andreportsfrom cybersecuritysystemsdeployedinourITenvironment.

Item2.PROPERTIES

AsofDecember30,2023,weoperatedmanufacturingfacilitiesinexcessof100,000squarefeetinthereportable segmentsandlocationslistedbelow.

MaterialsGroup

U.S.PeachtreeCity,Georgia;FortWayne,Greenfield,andLowell,Indiana;FairportHarbor, Mentor,OakHarbor,andPainesville,Ohio;MillHall,Pennsylvania

Non-U.S.SoigniesandTurnhout,Belgium;Vinhedo,Brazil;Guangzhou,Kunshan,andZhuozhou, China;Champ-sur-Drac,France;Gotha,Germany;PuneandNoida,India;Longford, Ireland;KibbutzHanita,Israel;Rodange,Luxembourg;Bangi,Malaysia;Queretaro,Mexico; Rayong,Thailand;andCramlington,UnitedKingdom

SolutionsGroup

U.S.NewCentury,KansasandMiamisburg,Ohio

Non-U.S.Dhaka,Bangladesh;Guangzhou,Nansha,Panyu,andSuzhou,China;Bufalo,Honduras; Ancarano,Italy;Kulim,Malaysia;andLongAnProvince,Vietnam

Inadditiontothemanufacturingfacilitiesdescribedabove,ourotherprincipalfacilitiesincludeourcorporate headquartersanddivisionalofficeinMentor,OhioandourdivisionalandcorporateofficeslocatedinDallas,Texas; Vinhedo,Brazil;HongKongandKunshan,China;andOegstgeest,theNetherlands.

Weownalloftheprincipalpropertiesidentifiedabove,exceptforthefacilitiesinthefollowinglocations,whichare leased:HongKong,PanyuandZhuozhou,China;Bufalo,Honduras;KibbutzHanita,Israel;NewCentury,Kansas;Mentor, Ohio;andOegstgeest,theNetherlands.

Weconsiderallourproperties,whetherownedorleased,suitableandadequateforourcurrentneeds.We generallyexpandproductioncapacityasneededtomeetincreaseddemand.Ownedbuildingsandplantequipmentare insuredagainstmajorlossesfromfireandotherusualbusinessrisks,subjecttoapplicabledeductibles.Wearenotaware ofanymaterialdefectsintitleto,orsignificantencumbranceson,ourproperties,exceptforcertainmortgageliens.

SeeNote8,“Contingencies,”intheNotestoConsolidatedFinancialStatements.

Notapplicable.

Item3.LEGALPROCEEDINGS

Item4.MINESAFETYDISCLOSURES

Item5.MARKETFORREGISTRANT’SCOMMONEQUITY,RELATEDSTOCKHOLDERMATTERSAND ISSUERPURCHASESOFEQUITYSECURITIES

(a)Ourcommonstockislistedunderthetickersymbol“AVY”ontheNewYorkStockExchange.Wedidnotsell securitiesinanyunregisteredtransactionsduringfiscalyear2023.Wehavehistoricallypaidquarterlycash dividends.FuturedividendpaymentsaresubjecttotheapprovalbyourBoardofDirectorsbasedonourearnings, capitalrequirements,financialconditionandotherfactors.

Wehad3,600shareholdersofrecordasofDecember30,2023,thelastdayofour2023fiscalyear.

StockholderReturnPerformance

Thegraphbelowcomparesthecumulativestockholderreturnonourcommonstock,includingreinvestmentof dividends,withthereturnontheS&P500StockIndex,S&P500IndustrialsIndexandDowJonesU.S.Container& PackagingIndex,ineachcaseforthefive-yearperiodendingDecember31,2023.In2023,wedisaggregatedourmarket basketusedinpreviousyearsintotheS&P500IndustrialsIndexandtheDowJonesU.S.Container&PackagingIndex,of whichweareamember.Webelievethispresentationprovidesgreaterclarityonourrelativeperformance,reflectingitin amannermoreconsistentwiththemethodologyusedbypeercompanies.

(b)Notapplicable.

(c)RepurchasesofEquitySecuritiesbyIssuer

Repurchasesbyusorour“affiliatedpurchasers”(asdefinedinRule10b-18(a)(3)oftheExchangeAct)of registeredequitysecuritiesinthefourthquarterof2023areshowninthetablebelow.Repurchasedsharesmaybe reissuedunderourlong-termincentiveplanorusedforothercorporatepurposes.

Approximate dollarvalue ofsharesthat mayyetbe purchased underthe plans(5)

(1) Theperiodsshownareourfiscalmonthsduringthethirteen-weekquarterendedDecember30,2023.

(2) Sharesinthousands.

(3) Averagepricepaidpershareincludestransactioncoststoacquirethesharesandexcludesthenon-deductible1%excisetaxonthenetvalueof repurchasesimposedundertheInflationReductionActof2022.

(4) InApril2022,ourBoardauthorizedtherepurchaseofsharesofourcommonstockwithafairmarketvalueofupto$750million,excludinganyfees, commissionsorotherexpensesrelatedtosuchpurchases,inadditiontotheamountoutstandingunderourpreviousBoardauthorization.Board authorizationsremainineffectuntilsharesintheamountauthorizedthereunderhavebeenrepurchased.

(5) Dollarsinmillions.

Item6.RESERVED

ORGANIZATIONOFINFORMATION

Management’sDiscussionandAnalysisofFinancialConditionandResultsofOperations,orMD&A,provides management’sviewsonourfinancialconditionandresultsofoperations,shouldbereadinconjunctionwiththe ConsolidatedFinancialStatementsandrelatednotesthereto,andincludesthesectionsshownbelow.

NON-GAAPFINANCIALMEASURES

WereportourfinancialresultsinconformitywithaccountingprinciplesgenerallyacceptedintheUnitedStatesof America,orGAAP,andalsocommunicatewithinvestorsusingcertainnon-GAAPfinancialmeasures.Thesenon-GAAP financialmeasuresarenotinaccordancewith,noraretheyasubstitutefororsuperiorto,thecomparableGAAPfinancial measures.Thesenon-GAAPfinancialmeasuresareintendedtosupplementthepresentationofourfinancialresults preparedinaccordancewithGAAP.Weusethesenon-GAAPfinancialmeasuresinternallytoevaluatetrendsinour underlyingperformance,aswellastofacilitatecomparisontotheresultsofcompetitorsforquartersandyear-to-date periods,asapplicable.Basedonfeedbackfrominvestorsandfinancialanalysts,webelievethatthesupplementalnonGAAPfinancialmeasuresweprovidearealsousefultotheirassessmentsofourperformanceandoperatingtrends,as wellasliquidity.ReconciliationsareprovidedinaccordancewithRegulationGandS-Kandreconcileournon-GAAP financialmeasureswiththemostdirectlycomparableGAAPfinancialmeasures.

Ournon-GAAPfinancialmeasuresexcludetheimpactofcertainevents,activitiesorstrategicdecisions.The accountingeffectsoftheseevents,activitiesordecisions,whichareincludedintheGAAPfinancialmeasures,maymake itmoredifficulttoassessourunderlyingperformanceinasingleperiod.Byexcludingtheaccountingeffects,positiveor negative,ofcertainitems(e.g.,restructuringcharges,outcomesofcertainlegalproceedings,certaineffectsofstrategic transactionsandrelatedcosts,lossesfromdebtextinguishments,gainsorlossesfromcurtailmentorsettlementof pensionobligations,gainsorlossesonsalesofcertainassets,gainsorlossesonventureinvestments,currency adjustmentsduetohighlyinflationaryeconomies,andotheritems),webelievethatweareprovidingmeaningful supplementalinformationthatfacilitatesanunderstandingofourcoreoperatingresultsandliquiditymeasures.While someoftheitemsweexcludefromGAAPfinancialmeasuresrecur,theytendtobedisparateinamount,frequencyor timing.

Weusethenon-GAAPfinancialmeasuresdefinedbelowinthisMD&A.

• Saleschangeex.currency referstotheincreaseordecreaseinnetsales,excludingtheestimatedimpactof foreigncurrencytranslation,thereclassificationofsalesbetweensegments;whereapplicable,anextraweek inourfiscalyear;thecalendarshiftresultingfromtheextraweekinthepriorfiscalyear;andcurrency adjustmentfortransitionalreportingofhighlyinflationaryeconomies.Theestimatedimpactofforeign currencytranslationiscalculatedonaconstantcurrencybasis,withprior-periodresultstranslatedatcurrent periodaverageexchangeratestoexcludetheeffectofforeigncurrencyfluctuations.

• Organicsaleschange referstosaleschangeex.currency,excludingtheestimatedimpactofacquisitionsand productlinedivestitures.

Webelievethatsaleschangeex.currencyandorganicsaleschangeassistinvestorsinevaluatingthesaleschange fromtheongoingactivitiesofourbusinessesandenhancetheirabilitytoevaluateourresultsfromperiodtoperiod.

• Adjustedfreecashflow referstocashflowprovidedbyoperatingactivities,lesspaymentsforproperty,plant andequipment,softwareandotherdeferredcharges,plusproceedsfromcompany-ownedlifeinsurance policies,plusproceedsfromsalesofproperty,plantandequipment,plus(minus)netproceedsfrominsurance andsales(purchases)ofinvestments.Whereapplicable,adjustedfreecashflowisalsoadjustedforcertain acquisition-relatedtransactioncosts.Webelievethatadjustedfreecashflowassistsinvestorsbyshowingthe amountofcashwehaveavailablefordebtreductions,dividends,sharerepurchases,andacquisitions.

• Operationalworkingcapitalasapercentageofannualizedcurrentquarternetsales referstotradeaccounts receivableandinventories,netofaccountspayable,andexcludescashandcashequivalents,short-term borrowings,deferredtaxes,othercurrentassetsandothercurrentliabilities,aswellasnetcurrentassetsor liabilitiesheld-for-saledividedbyannualizedcurrentquarternetsales.Webelievethatoperationalworking capitalasapercentageofannualizedcurrentquarternetsalesassistsinvestorsinassessingourworking capitalrequirementsbecauseitexcludestheimpactoffluctuationsattributabletoourfinancingandother activities(whichaffectcashandcashequivalents,deferredtaxes,othercurrentassetsandothercurrent liabilities)thattendtobedisparateinamount,frequencyortiming,andmayincreasethevolatilityofworking capitalasapercentageofsalesfromperiodtoperiod.Theitemsexcludedfromthismeasurearenot significantlyinfluencedbyourday-to-dayactivitiesmanagedattheoperatinglevelanddonotnecessarily reflecttheunderlyingtrendsinouroperations.

OVERVIEWANDOUTLOOK

FiscalYear

Ourfiscalyearsgenerallyconsistof52weeks,buteveryfifthorsixthfiscalyearconsistsof53weeks;our2023, 2022,and2021fiscalyearsconsistedof52-weekperiodsendingDecember30,2023,December31,2022and January1,2022,respectively.

NetSales

Thefactorsimpactingreportednetsaleschange,ascomparedtotheprior-yearperiod,areshowninthetable below.

20232022

In2023,netsalesdecreasedonanorganicbasisprimarilyduetolowervolume,partiallyoffsetbytheimpactof pricingactions.In2022,netsalesincreasedonanorganicbasisprimarilyduetopricingactions,partiallyoffsetbylower volume/mix.

NetIncome

Netincomedecreasedfromapproximately$757millionin2022toapproximately$503millionin2023.Themajor factorsaffectingthisdecreasewere:

•Lowervolumedrivenprimarilybyinventorydestocking

•Higherrestructuringcharges

•Increaseaccrualforalegacylegalmatter

•Higheremployee-relatedcosts

•Argentinepesoremeasurementloss

•Growthinvestments

Offsettingfactors:

•Benefitsfromproductivityinitiatives,includingtemporarycost-savingactions,materialre-engineeringand savingsfromrestructuringactions,netoftransitioncosts

•Thenetimpactofpricingandrawmaterialinputcosts

•Lowerprovisionforincometaxes

BusinessAcquisitions

2023BusinessAcquisitions

OnNovember23,2023,wecompletedourbusinessacquisitionofSilverCrystalGroup(“SilverCrystal”),a Canada-basedproviderofsportsapparelcustomizationandapplicationsolutionsacrossin-venue,direct-to-businessand e-commerceplatforms.OnMay22,2023,wecompletedourbusinessacquisitionofLGGroup,Inc.(“LionBrothers”),a Maryland-baseddesignerandmanufacturerofapparelbrandembellishments.OnMarch6,2023,wecompletedour businessacquisitionofThermopatch,Inc.(“Thermopatch”),aNewYork-basedmanufacturerspecializinginlabeling, embellishmentsandtransfersforthesports,industriallaundry,workwearandhospitalityindustries.Theseacquisitions expandedtheproductportfolioinourSolutionsGroupreportablesegment.

TheacquisitionsofSilverCrystal,LionBrothersandThermopatcharereferredtocollectivelyasthe“2023 Acquisitions.”

Theaggregatepurchaseconsideration,includingpurchaseconsiderationpayable,forthe2023Acquisitionswas approximately$231million.Wefundedthe2023Acquisitionsusingcashandcommercialpaperborrowings.Inaddition tothecashpaidatclosing,thesellersinoneoftheseacquisitionsareeligibleforearn-outpaymentsofupto$5million, subjecttotheacquiredcompanyachievingcertainpost-acquisitionperformancetargets.Asoftheacquisitiondate,we includedanestimateofthefairvalueoftheseearn-outpaymentsintheaggregatepurchaseconsideration.

Thefinalallocationsofpurchaseconsiderationforthe2023Acquisitionstoassetsandliabilitiesareongoingaswe continuetoevaluatecertainbalances,estimatesandassumptionsduringthemeasurementperiod(uptooneyearfrom theirrespectiveacquisitiondate).Consistentwiththeallowabletimetocompleteourassessment,thevaluationofcertain acquiredassetsandliabilities,includingenvironmentalliabilitiesandincometaxes,iscurrentlypendingfinalization.

The2023Acquisitionswerenotmaterial,individuallyorintheaggregate,totheConsolidatedFinancial Statements.

2022BusinessAcquisitions

InJanuary2022,wecompletedourbusinessacquisitionsofTexTraceAG(“TexTrace”),aSwitzerland-based technologydeveloperspecializingincustom-madewovenandknittedRFIDproductsthatcanbesewnontoorinserted intogarments,andRietveldSerigrafieB.V.andRietveldScreenprintingSerigrafiBaskiMatbaaTekstilIthalatIhracat SanayiveTicaretLimitedSirketi(collectively,“Rietveld”),aNetherlands-basedproviderofexternalembellishment solutionsandapplicationandprintingmethodsforperformancebrandsandteamsportsinEurope.Theseacquisitions expandedtheproductportfolioinourSolutionsGroupreportablesegment.TheacquisitionsofTexTraceandRietveldare referredtocollectivelyasthe“2022Acquisitions.”

Theaggregatepurchaseconsiderationforthe2022Acquisitionswasapproximately$35million.Wefundedthe 2022Acquisitionsusingcashandcommercialpaperborrowings.Inadditiontothecashpaidatclosing,thesellersinone oftheseacquisitionsareeligibleforearn-outpaymentsofupto$30million,subjecttotheacquiredcompanyachieving certainpost-acquisitionperformancetargets.Asoftheacquisitiondate,weincludedanestimateofthefairvalueof theseearn-outpaymentsintheaggregatepurchaseconsideration.

26 2023AnnualReport | AveryDennisonCorporation

The2022Acquisitionswerenotmaterial,individuallyorintheaggregate,totheConsolidatedFinancial Statements.

CostReductionActions

2023Actions

Inthethirdquarterof2023,weapprovedarestructuringplan(the“2023Plan”)tofurtheroptimizetheEuropean footprintofourMaterialsGroupreportablesegmentbyreducingoperationsinamanufacturingfacilityinBelgium.The cumulativechargesassociatedwiththe2023Planconsistedofseveranceandrelatedcostsforthereductionof approximately210positionsaswellasassetimpairmentcharges.During2023werecorded$30.4millionin restructuringchargesrelatedtothe2023Plan.Theactivitiesrelatedtothe2023Planareexpectedtobesubstantially completedbymid-2025.

Werecorded$49.0millioninrestructuringcharges,netofreversals,relatedtoother2023actions(collectively withthe2023Plan,“2023Actions”).Thesechargesconsistedofseveranceandrelatedcostsforthereductionof approximately1,450positionsandassetimpairmentchargesatnumerouslocationsacrossourcompany.

2019/2020Actions

During2022,werecorded$7.3millioninrestructuringcharges,netofreversals,relatedtoour2019/2020actions. Thesechargesconsistedofseveranceandrelatedcostsforthereductionofapproximately830positionsandasset impairmentchargesatnumerouslocationsacrossourcompany,reflectingactionsinbothourreportablesegments.The actionsinourMaterialsGroupreportablesegmentwereprimarilyassociatedwithconsolidationsofitsoperationsinNorth AmericaanditsgraphicsbusinessinEurope,inpartinresponsetothepandemic.TheactionsinourSolutionsGroup reportablesegmentwereprimarilyrelatedtoglobalheadcountandfootprintreduction,withsomeactionsaccelerated andexpandedinresponsetothepandemic.Ouractivitiesrelatedtoour2019/2020actionsbeganinthefourthquarterof fiscalyear2019andcontinuedthroughfiscalyear2022.

Werealizedapproximately$69millionand$26million,respectively,insavingsfromrestructuring,netoftransition costs,primarilyrelatedtoour2023actionsin2023andour2019/2020actionsin2022.

Restructuringchargeswereincludedin“Otherexpense(income),net”intheConsolidatedStatementsofIncome. RefertoNote13,“CostReductionActions,”totheConsolidatedFinancialStatementsformoreinformation.

AccountingGuidanceUpdates

RefertoNote1,“SummaryofSignificantAccountingPolicies,”totheConsolidatedFinancialStatementsforthis information.

In2023,netcashprovidedbyoperatingactivitiesdecreasedcomparedto2022primarilyduetolowernetincome andhighertaxpayments,netofrefunds,partiallyoffsetbychangesinoperationalworkingcapitalandlowerincentive compensationpayments.In2023,adjustedfreecashflowdecreasedcomparedto2022primarilyduetolowernetcash providedbyoperatingactivities,partiallyoffsetbyhigherproceedsfromcompany-ownedlifeinsurancepoliciesand lowerpurchasesofproperty,plantandequipment.

Certainfactorsthatwebelievewillcontributetoour2024resultsaredescribedbelow.

•Weanticipatenetsalestoincreaseduetohighervolumeasourmarketsimprovefollowingsignificant inventorydestockingdownstreamfromourcompanyin2023,whichwemaypartiallyoffsetwithdeflationrelatedpricingactions.

•Weanticipateincrementalsavingsfromrestructuringactions,netoftransitioncosts.

•Weexpectaninsignificantimpacttoourfull-yearoperatingincomefromforeigncurrencytranslation,based onrecentrates.

•Weexpectourfull-yeareffectivetaxratetobeinthemid-twentypercentrange.

GrossProfitMargin

Grossprofitmarginin2023increasedcomparedto2022primarilyduetobenefitsfromproductivityinitiatives, includingtemporarycost-savingactions,materialre-engineeringandsavingsfromrestructuringactions,netoftransition costs,andthenetimpactofpricingandrawmaterialinputscosts,partiallyoffsetbylowervolumeandhigheremployeerelatedcosts.

Grossprofitmarginin2022decreasedcomparedto2021primarilyduetothenetimpactofhighersellingprices, higherrawmaterialcostsandhigherfreightcosts,aswellashigheremployee-relatedcosts,partiallyoffsetbyhigher volume/mixprimarilyrelatedtotheimpactofacquisitions.

Marketing,GeneralandAdministrativeExpense

Marketing,generalandadministrativeexpensedecreasedin2023comparedto2022primarilyduetobenefits fromproductivityinitiatives,includingtemporarycost-savingactionsandsavingsfromrestructuringactions,netof transitioncosts,partiallyoffsetbyhigheremployee-relatedcostsandgrowthinvestments.

Marketing,generalandadministrativeexpenseincreasedin2022comparedto2021primarilyduetotheimpactof acquisitionsandgrowthinvestments,partiallyoffsetbytheimpactoffavorableforeigncurrencytranslation.

RefertoNote13,“CostReductionActions,”totheConsolidatedFinancialStatementsformoreinformation regardingrestructuringcharges.

RefertoNote9,“FairValueMeasurements,”totheConsolidatedFinancialStatementsformoreinformation regardinggainsonventureinvestments.

RefertoNote8,“Contingencies,”andNote15,“SegmentandDisaggregatedRevenueInformation,”tothe ConsolidatedFinancialStatementsformoreinformationregardingoutcomesoflegalproceedings.

InterestExpense

Interestexpenseincreasedbyapproximately$34.9millionin2023comparedto2022,primarilyasaresultof higherinterestratesonborrowingsandhigherdebtlevels.

Interestexpenseincreasedbyapproximately$13.9millionin2022comparedto2021,primarilyasaresultof additionalinterestfromthe$800millionofseniornotesweissuedinAugust2021andhigherinterestratesonshorttermborrowings.

OtherNon-OperatingExpense(Income),Net

Othernon-operatingincomeincreasedin2023comparedto2022duetohigherinterestincome,primarilyin Argentina.

Oureffectivetaxratein2023increasedcomparedto2022primarilyduetohighernon-deductibleexpenses resultingfromtheimpactoftheArgentinepesoremeasurementloss,highertaxchargesfromtherecognitionofuncertain taxpositionsincertainforeignjurisdictions,andlowerU.S.federalreturn-to-provisionbenefits.Oureffectivetaxratein 2022decreasedcomparedto2021primarilyduetohigherbenefitsrelatedtothesettlementofcertainforeigntaxaudits, partiallyoffsetbyU.S.federalreturn-to-provisionbenefitsthatwerelowerthanin2021.

Manycountrieshaveenacted,orplantoenact,changestotheirtaxlawsbasedontheOrganizationforEconomic CooperationandDevelopment(“OECD”)BaseErosionandProfitShiftingrecommendationstoimplementaglobal minimumtax,namelythePillarTwoframework.ThefirstcomponentofthePillarTwoframeworkisexpectedtobe effectiveforourcompanyin2024,withasecondcomponentexpectedtobeeffectivein2025.Whilewedonotexpect theimplementationofaglobalminimumtaxtohaveamaterialimpactonoureffectivetaxrate,ouranalysisisongoingas theOECDcontinuestoreleaseadditionalguidanceandcountriesimplementlegislation.

Oureffectivetaxratecanvaryfromperiodtoperiodduetoavarietyoffactors,suchaschangesinourmixof earningsincountrieswithdifferingstatutorytaxrates,changesinourtaxreserves,settlementsofincometaxaudits, changesintaxlawsandregulations,return-to-provisionadjustments,taximpactsrelatedtostock-basedpayments,and ourexecutionoftaxplanningstrategies.

RefertoNote14,“TaxesBasedonIncome,”totheConsolidatedFinancialStatementsformoreinformation.

RESULTSOFOPERATIONSBYREPORTABLESEGMENT

Operatingincomereferstoincomebeforetaxes,interestandothernon-operatingexpense(income),net.

(1) Includedchargesassociatedwithrestructuringactionsandrelatedcostsinallyears, Argentinepesoremeasurementlossandlossonsaleofassetsin2023,outcomesof legalproceedingsin2023and2021,gainonventureinvestmentin2022,andgain onsaleofproductline,gainonsaleofassets,andtransactionandrelatedcostsin

NetSales

Thefactorsimpactingreportednetsaleschangeareshowninthetablebelow.

(1) Totalsmaynotsumduetorounding.

20232022

In2023,netsalesdecreasedonanorganicbasiscomparedtothesameperiodintheprioryearduetolower volumedrivenprimarilybyinventorydestocking,partiallyoffsetbytheimpactofpricingactions.Onanorganicbasis,net salesdecreasedbyalowdouble-digitrateinNorthAmerica,amid-to-highteensrateinWesternEuropeandamid-tohighsingledigitrateinemergingmarkets.

In2022,netsalesincreasedonanorganicbasiscomparedtothesameperiodintheprioryearduetopricing actions,partiallyoffsetbylowervolume/mix.Onanorganicbasis,netsalesincreasedalowdouble-digitrateinNorth America,ahigh-teensrateinWesternEuropeandbyamid-to-highsingledigitrateinemergingmarkets.

OperatingIncome

Operatingincomedecreasedin2023comparedtothesameperiodin2022primarilyduetolowervolume,higher restructuringchargesandtheArgentinepesoremeasurementloss,partiallyoffsetbybenefitsfromproductivityinitiatives, includingtemporarycost-savingactions,materialre-engineeringandsavingsfromrestructuringactions,netoftransition costs,andthenetimpactofpricingandrawmaterialinputcosts. 30

Operatingincomedecreasedin2022comparedtothesameperiodin2021primarilyduetounfavorablevolume/ mix,theimpactofunfavorableforeigncurrencytranslation,higheremployee-relatedcostsandtheimpactofaBrazil indirecttaxcreditintheprioryear,partiallyoffsetbythenetimpactofhighersellingprices,higherrawmaterialcostsand higherfreightcosts.

(1) Includedchargesassociatedwithrestructuringactions,outcomesoflegal proceedings,andtransactionandrelatedcostsinallyears,lossonventure investmentsin2023,gainonsalesofassetsin2022,lossonsaleofassetandgain onventureinvestmentsin2021.$86.3$7.8$36.6 NetSales

Thefactorsimpactingreportednetsaleschangeareshowninthetablebelow.

(1) Totalsmaynotsumduetorounding.

5%

In2023,onanorganicbasis,netsalesincreasedbyahighsingle-digitrateinhigh-valuecategoriesanddecreased byalow-doubledigitrateinthebasebusinesscomparedtotheprioryear.Company-wide,onanorganicbasis,salesof IntelligentLabelsolutionsincreasedbyalow-doubledigitratecomparedtotheprioryear.

In2022,onanorganicbasis,netsalesincreasedbyamid-teensrateinhigh-valuecategoriesanddecreasedbya low-singledigitrateinthebasebusinesscomparedtotheprioryear.Company-wide,onanorganicbasis,salesof IntelligentLabelsolutionsincreasedbyamid-teensratecomparedtotheprioryear.

OperatingIncome

Operatingincomedecreasedin2023comparedto2022primarilyduetoanincreasedaccrualforthe Adasa legal matter(describedinNote8,“Contingencies”totheConsolidatedFinancialStatements),higheremployee-relatedcosts, lowervolume,growthinvestmentsandtheimpactofunfavorableforeigncurrencytranslation,partiallyoffsetbybenefits fromproductivityinitiatives,includingtemporarycost-savingactionsandsavingsfromrestructuringactions,netof transitioncosts.

Operatingincomeincreasedin2022comparedto2021primarilyduetothecombinedbenefitofhigherorganic volumeandacquisitions,theimpactoflegalproceedingsintheprioryear,andlowertransactionandrelatedcosts, partiallyoffsetbyhigheramortizationofotherintangiblesresultingfrombusinessacquisitions,growthinvestmentsand higheremployee-relatedcosts.

FINANCIALCONDITION

Liquidity

OperatingActivities

In2023,cashflowprovidedbyoperatingactivitiesdecreasedcomparedto2022primarilyduetolowernetincome andhighertaxpayments,netofrefunds,partiallyoffsetbychangesinoperationalworkingcapitalandlowerincentive compensationpayments.

In2022,cashflowprovidedbyoperatingactivitiesdecreasedcomparedto2021primarilyduetochangesin operationalworkingcapital,higherincentivecompensationpaymentsandthetimingofpayrollpayments,partiallyoffset byhighernetincomeandlowerincometaxpayments,netofrefunds.

In2023,inourSolutionsGroupreportablesegment,weprimarilyinvestedinbuildingsandequipmenttosupport growthincertaincountriesinAsiaPacific,primarilyMalaysia,intheU.S.andincertaincountriesinLatinAmerica, primarilyMexico;inourMaterialsGroupreportablesegment,weprimarilyinvestedinbuildingsandequipmenttosupport growthintheU.S.andincertaincountriesinEurope,primarilyFrance,andinAsiaPacific,primarilyChina.In2022,inour SolutionsGroupreportablesegment,weprimarilyinvestedinbuildingsandequipmenttosupportgrowthincertain countriesinAsiaPacific,includingMalaysia,ChinaandVietnam,andintheU.S.;inourMaterialsGroupreportable segment,weprimarilyinvestedinbuildingsandequipmentintheU.S.andcertaincountriesinEurope,primarilyFrance, andLatinAmerica,primarilyBrazil.In2021,inourMaterialsGroupreportablesegment,weprimarilyinvestedin equipmenttosupportgrowthintheU.S.andcertaincountriesinAsiaPacific,includingIndiaandChina,andEurope, 32 2023AnnualReport | AveryDennisonCorporation

includingFranceandLuxembourg;inourSolutionsGroupreportablesegmentweprimarilyinvestedinequipmentto supportgrowthincertaincountriesinAsiaPacific,includingChina,MalaysiaandBangladesh,andintheU.S.

PurchasesofSoftwareandOtherDeferredCharges

In2023,2022and2021,weinvestedininformationtechnologyupgradesworldwide.

ProceedsfromCompany-OwnedLifeInsurancePolicies

In2023,weutilizedapproximately$48millionofthecashsurrendervalueavailableunderourcompany-owned lifeinsurancepolicies.

ProceedsfromSaleofProductLineandVentureInvestment

In2022,wereceivedproceedsof$1.1millionfromthesaleofaventureinvestment.In2021,proceedsfromthe saleofaproductlinewereinourMaterialsGroupreportablesegment.

PaymentsforAcquisitions,NetofCashAcquired,andVentureInvestments

Wepaidconsideration,netofcashacquired,ofapproximately$223millionforthe2023Acquisitionsand $30millionforthe2022Acquisitions.Wefundedthe2023Acquisitionsand2022Acquisitionsusingcashand commercialpaperborrowings.In2021,wepaidconsideration,netofcashacquired,ofapproximately$1.44billionto acquireCBVelocityHoldings,LLC(“Vestcom”)and$32milliontoacquireZippyYum,LLC(“ZippyYum”)andJDC Solutions,Inc.(“JDC”).WefundedtheVestcomacquisitionusingthenetproceedsfromtheseniornotesweissuedin August2021,commercialpaperborrowingsandcash.WefundedtheZippyYumandJDCacquisitionsusingcashand commercialpaperborrowings.Wealsomadecertainventureinvestmentsin2023,2022and2021.

RefertoNote2,“BusinessAcquisitions,”totheConsolidatedFinancialStatementsformoreinformation.

BorrowingsandRepaymentofDebt

During2023,2022and2021,ourcommercialpaperborrowingswereusedtofundacquisitions,dividend payments,sharerepurchases,capitalexpendituresandothergeneralcorporatepurposes.

InMarch2023,weissued$400millionofseniornotes,dueMarch15,2033,whichbearaninterestrateof 5.750%peryear,payablesemiannuallyinarrears.Ournetproceedsfromthisissuance,afterdeductingunderwriting discountsandofferingexpenses,were$394.9million,whichweusedtorepaybothexistingindebtednessunderour commercialpaperprogramsandour$250millionaggregateprincipalamountofseniornotesthatmaturedonApril15, 2023.

InAugust2021,weissued$500millionofseniornotes,dueFebruary15,2032,whichbearaninterestrateof 2.250%,payablesemiannuallyinarrears.Ournetproceedsfromthisissuance,afterdeductingunderwritingdiscounts andofferingexpenses,were$493.7million.Additionally,inAugust2021,weissued$300millionofseniornotes,due August15,2024,whichwecanrepaywithoutpenaltyonorafterAugust15,2022andbearaninterestrateof0.850%,

payablesemiannuallyinarrears.Ournetproceedsfromthisissuance,afterdeductingunderwritingdiscountsandoffering expenses,were$298million.Weusedthenetproceedsfromthesetwodebtissuancestofinanceaportionofthe Vestcomacquisition.

RefertoNote2,“BusinessAcquisitions,”andNote4,“Debt,”totheConsolidatedFinancialStatementsformore information.

DividendsPaid

Wepaiddividendspershareof$3.18,$2.93and$2.66in2023,2022and2021,respectively.InApril2023,we increasedourquarterlydividendrateto$.81pershare,representinganincreaseofapproximately8%fromourprevious quarterlydividendrateof$.75pershare.InApril2022,weincreasedourquarterlydividendto$.75pershare, representinganincreaseofapproximately10%fromourpreviousdividendrateof$.68pershare.

ShareRepurchases

Fromtimetotime,ourBoardauthorizestherepurchaseofsharesofouroutstandingcommonstock.Repurchased sharesmaybereissuedunderourlong-termincentiveplanorusedforothercorporatepurposes.In2023,2022and 2021,werepurchasedapproximately0.8million,2.2millionand0.9millionsharesofourcommonstock,respectively.

InApril2022ourBoardauthorizedtherepurchaseofsharesofourcommonstockwithafairmarketvalueofupto $750million,excludinganyfees,commissionsorotherexpensesrelatedtosuchpurchasesandinadditiontoanyamount outstandingunderourpreviousBoardauthorization.Sharesofourcommonstockintheaggregateamountof$592.8 millionasofDecember30,2023remainedauthorizedforrepurchaseunderthisBoardauthorization.Board authorizationsremainineffectuntilsharesintheamountauthorizedthereunderhavebeenrepurchased.

Net(TaxWithholding)ProceedsRelatedtoStock-BasedCompensation

In2023,taxwithholdingforstock-basedcompensationwascomparableto2022and2021.

Approximately.02millionstockoptionswereexercisedin2021.RefertoNote12,“Long-TermIncentive Compensation,”totheConsolidatedFinancialStatementsformoreinformation.

AnalysisofSelectedBalanceSheetAccounts

Long-livedAssets

Property,plantandequipment,net,increasedbyapproximately$86millionto$1.63billionatyear-end2023, whichprimarilyreflectedpurchasesofproperty,plantandequipmentandtheimpactofforeigncurrencytranslation, partiallyoffsetbydepreciationexpense.

Goodwillincreasedbyapproximately$151millionto$2.01billionatyear-end2023,whichreflectedtheimpactof theacquiredgoodwillassociatedwiththe2023Acquisitionsandforeigncurrencytranslation.

Otherintangiblesresultingfrombusinessacquisitions,net,increasedbyapproximately$9millionto$849.1million atyear-end2023,reflectingthevaluationofintangibleassetsassociatedwiththe2023Acquisitions,partiallyoffsetby currentyearamortizationexpense.

RefertoNote3,“GoodwillandOtherIntangiblesResultingfromBusinessAcquisitions,”totheConsolidated FinancialStatementsformoreinformation.

Otherassetsdecreasedbyapproximately$1millionto$809.6millionatyear-end2023,primarilyreflectingthe utilizationofthecashsurrendervalueavailableunderourcompany-ownedlifeinsurancepolicies,partiallyoffsetby higheroperatingleaseassets.

Long-termRetirementBenefitsandOtherLiabilities

Otherlong-termretirementbenefitsandotherliabilitiesincreasedbyapproximately$133millionto$500.3million atyear-end2023,primarilyreflectingthecontingentliabilityrecordedforthe Adasa legalmatterandhigheroperating leaseliabilities.

Shareholders’EquityAccounts

Thebalanceofourshareholders’equityincreasedbyapproximately$96millionto$2.13billionatyear-end2023. RefertoNote11,“SupplementalEquityandComprehensiveIncomeInformation,”totheConsolidatedFinancial Statementsformoreinformation.

ImpactofForeignCurrencyTranslation

(Inmillions)

20232022

Changeinnetsales$(58)$(417)

In2023,internationaloperationsgeneratedapproximately69%ofournetsales.Ourfutureresultsaresubjectto changesinpolitical,socialandeconomicconditionsintheregionsinwhichweoperateandtheimpactoffluctuationsin foreigncurrencyexchangerates.

Theunfavorableimpactofforeigncurrencytranslationonnetsalesin2023comparedto2022wasprimarily relatedtosalesinChina,partiallyoffsetbyfavorableimpactfromeuro-denominatedsales.

EffectofForeignCurrencyTransactions

Theimpactonnetincomefromtransactionsdenominatedinforeigncurrenciesislargelymitigatedbecausethe costsofourproductsaregenerallydenominatedinthesamecurrenciesinwhichtheyaresold.Inaddition,toreduceour incomeandcashflowexposuretotransactionsinforeigncurrencies,weenterintoforeignexchangeforward,optionand swapcontractswhereavailableandappropriate.RefertoNote5,“FinancialInstruments,”totheConsolidatedFinancial Statementsformoreinformation.

During2023,theArgentinepesodevaluedsignificantlycomparedtotheU.S.dollarwhichresultedin remeasurementlossofapproximately$30millionwhichwasincludedin“Otherexpense(income),net”inthe ConsolidatedStatementsofIncome.

AnalysisofSelectedFinancialRatios

Weutilizethefinancialratiosdiscussedbelowtoassessourfinancialconditionandoperatingperformance.We believethisinformationassistsourinvestorsinunderstandingthefactorsimpactingourcashflowotherthannetincome andcapitalexpenditures.

OperationalWorkingCapitalRatio

Operationalworkingcapital,asapercentageofannualizedcurrent-quarternetsales,isreconciledtoworking capital(deficit)below.Ourobjectiveistominimizeourinvestmentinoperationalworkingcapital,asapercentageof annualizedcurrent-quarternetsales,tomaximizeourcashflowandreturnoninvestment.Operationalworkingcapital,as apercentageofannualizedcurrent-quarternetsales,in2023waslowerthanin2022.Furtherinformationregardingthe componentsofoperationalworkingcapitalisprovidedbelow.

AccountsReceivableRatio

Theaveragenumberofdayssalesoutstandingwas61daysin2023comparedto62daysin2022,calculated usingtheaccountsreceivablebalanceatyear-enddividedbytheaveragedailysalesinthefourthquarterof2023and 2022,respectively.

InventoryRatio

Averageinventoryturnoverwas6.6in2023comparedto6.0in2022,calculatedusingtheannualizedfourthquartercostofproductssoldin2023and2022,respectively,anddividedbytheinventorybalanceattherespectiveyearend.Theincreaseinaverageinventoryturnoverprimarilyreflectedhigherprior-yearinventorybalancesduetocustomer inventorydestocking.

AccountsPayableRatio

Theaveragenumberofdayspayableoutstandingwas77daysin2023comparedto80daysin2022,calculated usingtheaccountspayablebalanceatyear-enddividedbytheannualizedfourth-quartercostofproductssoldin2023 and2022,respectively.Thedecreaseintheaveragenumberofdayspayableoutstandingfromtheprioryearprimarily reflectedthetimingofvendorpayments,theimpactofacquisitionsandtheimpactofforeigncurrencytranslation.

CapitalResources

Capitalresourcesincludecashflowsfromoperations,cashandcashequivalentsanddebtfinancing,including accesstocommercialpaperborrowingssupportedbytheRevolver.Weusetheseresourcestofundouroperational needs.

Atyear-end2023,wehadcashandcashequivalentsof$215.0millionheldinaccountsatthird-partyfinancial institutionsinnumerouslocationsthroughouttheworld.Atyear-end2023,themajorityofourcashandcashequivalents washeldbyourforeignsubsidiaries,primarilyintheAsiaPacificregion.

TomeetourU.S.cashrequirements,wehaveseveralcost-effectiveliquidityoptionsavailable.Theseoptions includeborrowingfundsatreasonablerates,includingborrowingsfromourforeignsubsidiaries,andrepatriatingforeign earningsandprofits.However,ifweweretorepatriateforeignearningsandprofits,aportionwouldbesubjecttocash paymentsofwithholdingtaxesimposedbyforeigntaxauthorities.AdditionalU.S.taxesmayalsoresultfromtheimpact offoreigncurrencyfluctuationsrelatedtotheseearningsandprofits.

InJanuary2023,weextendedthematuritydateoftheRevolverbyoneyeartoFebruary13,2026,andincreased thecommitmentsby$400million,from$800millionto$1.2billion.Additionally,weamendedtheRevolvertoreplacethe LIBORbenchmarkinterestratewithTermSOFR,EuriborandSONIAbenchmarkinterestrates.WeusetheRevolverasa back-upfacilityforourcommercialpaperprogramandforothercorporatepurposes.

TheRevolvercontainsafinancialcovenantthatrequiresustomaintainamaximumleverageratio(calculatedasa ratioofconsolidateddebttoconsolidatedEBITDAasdefinedintheagreement)ofnotmorethan3.50to1.00;provided that,intheeventofanacquisitionbyusthatexceeds$250million,whichoccurredwhenweacquiredVestcom,the maximumleverageratioincreasesto4.00to1.00forthefiscalquarterinwhichtheacquisitionoccursandthethreefiscal quartersimmediatelyfollowingthatfiscalquarter.AsofDecember30,2023andDecember31,2022,ourratiowas substantiallybelowthemaximumratioallowedbytheRevolver.

InadditiontotheRevolver,wehaveshort-termlinesofcreditavailableinvariouscountriesofapproximately $327millionintheaggregateatDecember30,2023.Theselinesmaybecancelledatanytimebyusortheissuingbanks. Short-termborrowingsoutstandingundertheselinesofcreditwere$1.0millionand$2.4millionatDecember30,2023 andDecember31,2022,respectively,withweightedaverageinterestratesof2.24%and0.64%,respectively.Referto Note4,“Debt,”totheConsolidatedFinancialStatementsformoreinformation.

Weareexposedtofinancialmarketriskresultingfromchangesininterestandforeigncurrencyexchangerates, andtopossibleliquidityandcreditrisksofourcounterparties.

Wecurrentlyanticipateusingcashflowsfromoperationsandcommercialpaperborrowingstorepaythe $300millionofseniornotesweissuedin2021,whichmatureinthethirdquarterof2024.

CapitalfromDebt

Thecarryingvalueofourtotaldebtincreasedbyapproximately$142millionto$3.24billionatyear-end2023 from2022,primarilyreflectingourissuanceof$400millionofseniornotesinMarch2023andtherevaluationofour euro-denominatedseniornotes,partiallyoffsetbytherepaymentofour$250millionofseniornotesmaturinginApril 2023andanetdecreaseincommercialpaperborrowings.

Creditratingsareasignificantfactorinourabilitytoraiseshort-andlong-termfinancing.Thecreditratings assignedtoourcompanyalsoimpacttheinterestrateswepayandouraccesstocommercialpaper,creditfacilities,and otherborrowings.Adowngradeofourshort-termcreditratingscouldimpactourabilitytoaccesscommercialpaper markets.Ifouraccesstocommercialpapermarketsweretobecomelimited,theRevolverandourothercreditfacilities wouldbeavailabletomeetourshort-termfundingrequirements.Whendeterminingourcreditrating,webelievethat ratingagenciesprimarilyconsiderourcompetitiveposition,businessoutlook,consistencyofcashflows,debtleveland liquidity,geographicfootprintandmanagementteam.Weremaincommittedtomaintaininganinvestmentgraderating.

FairValueofDebt

Theestimatedfairvalueofourlong-termdebtisprimarilybasedonthecreditspreadaboveU.S.Treasury securitiesoreurogovernmentbondsecurities,asapplicable,onnoteswithsimilarrates,creditratingsandremaining maturities.Thefairvalueofshort-termborrowings,whichincludescommercialpaperissuancesandshort-termlinesof credit,approximatestheircarryingvaluegiventheirshortduration.Thefairvalueofourtotaldebtwas$3.11billionat December30,2023and$2.85billionatDecember31,2022.Fairvalueamountsweredeterminedbasedprimarilyon Level2inputs,whichareinputsotherthanquotedpricesinactivemarketsthatareeitherdirectlyorindirectlyobservable. RefertoNote1,“SummaryofSignificantAccountingPolicies,”formoreinformation.

ContractualObligations,CommitmentsandOff-BalanceSheetArrangements

MaterialCashRequirementsatEndofYear2023

Wehaveshort-andlong-termmaterialcashrequirementsrelatedtoourcontractualobligationsthatariseinthe normalcourseofbusiness.Inadditiontoprincipalandinterestpaymentsonouroutstandingdebtobligations,our contractualobligationsprimarilyconsistofleasepaymentsandpurchasecommitments.

RefertoNote4,“Debt,”totheConsolidatedFinancialStatementsforasummaryofourprincipalpaymentsfor short-termborrowingsandlong-termdebtobligationsasofDecember30,2023.Futureinterestpaymentsforlong-term debtasofDecember30,2023areapproximately$90millionin2024;$87millionin2025;$78millionin2026;$78 millionin2027;$78millionin2028;and$199millionfrom2029throughmaturity.

AsofDecember30,2023,wehaveacommitmenttopurchaseapproximately$164millionofrawmaterialsin fiscalyear2024.

RefertoNote7,“CommitmentsandLeases,”totheConsolidatedFinancialStatementsforasummaryofourlease obligationsasofDecember30,2023.

RefertoNote6,“PensionandOtherPostretirementBenefits,”totheConsolidatedFinancialStatementsfor informationregardingourdefinedbenefitpensionplancontributionsandfuturebenefitpayments,deferredcompensation planbenefitpaymentsandunfundedterminationindemnitybenefits.

RefertoNote12,“Long-termIncentiveCompensation,”totheConsolidatedFinancialStatementsforinformation regardingcash-basedawardstoemployeesunderoneofourlong-termincentivecompensationplans.

RefertoNote14,“TaxesBasedonIncome,”totheConsolidatedFinancialStatementsformoreinformation regardingourunrecognizedtaxbenefitsofapproximately$88million.

CRITICALACCOUNTINGESTIMATES

ThepreparationoffinancialstatementsinconformitywithGAAPrequiresourmanagementtomakeestimatesand assumptionsforthereportingperiodandasofthefinancialstatementdate.Theseestimatesandassumptionsaffectour reportedamountsofassetsandliabilities,disclosureofcontingentliabilities,andreportedamountsofrevenueand expense.Actualresultscoulddifferfromtheseestimates.

Criticalaccountingestimatesarethosethatareimportanttoourfinancialconditionandresults,andwhichrequire ustomakedifficult,subjectiveand/orcomplexjudgments.Criticalaccountingestimatescoveraccountingmattersthatare inherentlyuncertainbecausetheirfutureresolutionisunknown.Webelieveourcriticalaccountingestimatesinclude accountingforgoodwill,businesscombinations,pensionandpostretirementbenefits,taxesbasedonincomeandlongtermincentivecompensation.

Goodwill

Businesscombinationsareaccountedforusingtheacquisitionmethod,withtheexcessoftheacquisitioncostover thefairvalueofnettangibleassetsandidentifiedintangibleassetsacquiredconsideredgoodwill.Asaresult,wedisclose goodwillseparatelyfromotherintangibleassets.Ourreportingunitsarecomposedofeitheradiscretebusinessoran aggregationofbusinesseswithsimilareconomiccharacteristics.

Weperformourannualimpairmenttestofgoodwillduringthefourthquarter.Certainfactorsmaycauseusto performanimpairmenttestpriortothefourthquarter,includingsignificantunderperformanceofabusinessrelativeto expectedoperatingresults,significantadverseeconomicandindustrytrends,significantdeclineinourmarket capitalizationforanextendedperiodoftimerelativetonetbookvalue,oradecisiontodivestaportionofareportingunit. Inperformingimpairmenttests,wehavetheoptiontofirstassessqualitativefactorstodeterminewhetheritisnecessary toperformaquantitativeassessmentforgoodwillimpairment.Ifthequalitativeassessmentindicatesthatitismorelikely-than-notthatthefairvalueofareportingunitislessthanitscarryingvalue,weperformaquantitativeassessment.

Aquantitativeassessmentprimarilyconsistsofusingthepresentvalue(discountedcashflow)methodto determinethefairvalueofreportingunitswithgoodwill.Wecomparethefairvalueofeachreportingunittoitscarrying amount,and,totheextentthecarryingamountexceedstheunit’sfairvalue,werecognizeanimpairmentofgoodwillfor theexcessuptotheamountofgoodwillofthatreportingunit.Inconsultationwithoutsidespecialists,weestimatethe fairvalueofourreportingunitsusingvariousvaluationtechniques,withtheprimarytechniquebeingadiscountedcash flowanalysis.Adiscountedcashflowanalysisrequiresustomakevariousassumptionsaboutourreportingunits, includingtheirrespectiveforecastedsales,operatingmarginsandgrowthrates,aswellasdiscountrates.Our assumptionsaboutdiscountratesarebasedontheweightedaveragecostofcapitalforcomparablecompanies.Our assumptionsaboutsales,operatingmarginsandgrowthratesarebasedonourforecasts,businessplans,economic projections,anticipatedfuturecashflows,andmarketplacedata.Wealsomakeassumptionsforvaryingperpetual growthratesforperiodsbeyondourlong-termbusinessplanperiod.Webaseourfairvalueestimatesonprojected financialinformationandassumptionsthatwebelievearereasonable.However,actualfutureresultsmaydiffermaterially fromtheseestimatesandprojections.Thevaluationmethodologyweusetoestimatethefairvalueofreportingunits requiresinputsandassumptionsthatreflectcurrentmarketconditions,aswellastheimpactofplannedbusinessand operationalstrategiesthatrequiremanagementjudgment.Theestimatedfairvaluecouldincreaseordecreasedepending onchangesintheinputsandassumptions.

Inourannualimpairmentanalysisinthefourthquarterof2023,thegoodwillofallreportingunitsinourMaterials GroupandSolutionsGroupreportablesegmentsweretestedutilizingaqualitativeassessment.Basedonthis assessment,wedeterminedthatthefairvaluesofthesereportingunitsweremore-likely-than-notgreaterthantheir respectivecarryingvalues.Therefore,thegoodwillofourreportingunitswasnotimpaired.

BusinessCombinations

TheresultsofacquiredbusinessesareincludedinourConsolidatedFinancialStatementsfromtheiracquisition date.Assetsandliabilitiesofanacquiredbusinessarerecordedattheirestimatedfairvaluesontheacquisitiondate.We engagethird-partyvaluationspecialiststoassistusindeterminingthesefairvalueswherenecessary.Anyexcess considerationoverthefairvalueofassetsacquiredandliabilitiesassumedisrecognizedasgoodwill.

Theallocationofpurchasepricerequiresmanagementtomakesignificantestimatesandassumptions.Whilewe believeourassumptionsandestimatesarereasonable,theyareinherentlyuncertainandbasedinpartonourexperience, marketconditions,ourprojectionsoffutureperformance,andinformationobtainedfrommanagementoftheacquired companies.Criticalestimatesinclude,butarenotlimitedto,thefollowing:

•Futurerevenueandprofitmargins;

•Royaltyrates;

•Discountrates;

•Customerretentionrates;

•Technologymigrationcurves;and

•Usefullivesassignedtoacquiredintangibleassets.

Acquiredidentifiablefinite-livedintangibleassetsareamortizedonastraight-linebasisovertheirrespective estimatedusefullivestomarketing,generalandadministrativeexpense.

PensionandPostretirementBenefits

Theassumptionsweuseindeterminingprojectedbenefitobligationsandthefairvalueofplanassetsforour definedbenefitpensionplansandotherpostretirementbenefitplansareevaluatedbymanagementinconsultationwith outsideactuaries.Intheeventthatwedeterminethatchangesarewarrantedintheassumptionsweuse,suchasthe discountrate,expectedlong-termrateofreturnorhealthcarecosts,futurepensionandpostretirementbenefitexpenses couldincreaseordecrease.Duetochangesinmarketconditionsorparticipantpopulation,theactuarialassumptionswe usemaydifferfromactualresults,whichcouldhaveasignificantimpactonourpensionandpostretirementliabilitiesand relatedcosts.

DiscountRate

Inconsultationwithouractuaries,weannuallyreviewanddeterminethediscountratesweuseinvaluingour postretirementobligations.Theassumeddiscountratesforournon-U.S.pensionplansreflectmarketratesforhigh qualitycorporatebondscurrentlyavailable.Ourdiscountratesaredeterminedbyevaluatingyieldcurvesconsistingof largepopulationsofhighqualitycorporatebonds.Theprojectedpensionbenefitpaymentstreamsarethenmatchedwith thebondportfoliostodeterminearatethatreflectstheliabilitydurationuniquetoourpensionandpostretirementbenefit plans.AsofDecember30,2023,a0.25%increaseinthediscountratesassociatedwithournon-U.S.planswouldhave decreasedouryear-endprojectedbenefitobligationby$27millionanddecreasedexpectedperiodicbenefitcostforthe comingyearbyapproximately$1million.Conversely,a0.25%decreaseinthediscountratesassociatedwithournonU.S.planswouldhaveincreasedouryear-endprojectedbenefitobligationbyapproximately$27millionandwouldnot haveasignificantimpactonexpectedperiodicbenefitcostforthecomingyear.

Weusethefullyieldcurveapproachtoestimatetheserviceandinterestcostcomponentsofnetperiodicbenefit costforourpensionandotherpostretirementbenefitplans.Usingthisapproach,weapplymultiplediscountratesfroma yieldcurvecomposedoftheratesofreturnonseveralhundredhigh-quality,fixedincomecorporatebondsavailableat themeasurementdate.Webelievethisapproachprovidesamoreprecisemeasurementofserviceandinterestcostby aligningthetimingofplanliabilitycashflowstothecorrespondingratesontheyieldcurve.

Long-termReturnonPlanAssets

Wedeterminethelong-termrateofreturnassumptionforplanassetsbyreviewingthehistoricalandexpected returnsofboththeequityandfixedincomemarkets,takingintoaccountourassetallocation,thecorrelationbetween returnsinourassetclasses,andourmixofactiveandpassiveinvestments.Additionally,currentmarketconditions, includinginterestrates,areevaluatedandmarketdataisreviewedforreasonablenessandappropriateness.Anincrease ordecreaseof0.25%onthelong-termreturnonassetsassociatedwithournon-U.S.planswouldhavedecreasedor increasedourperiodicbenefitcostforthecomingyearbyapproximately$2million.

TaxesBasedonIncome

BecausewearesubjecttoincometaxintheU.S.andmultipleforeignjurisdictions,judgmentisrequiredin evaluatingandestimatingourworldwideprovisionforincometaxes,accrualsfortaxes,deferredtaxesandtaxpositions. OurprovisionforincometaxesisdeterminedusingtheassetandliabilityapproachinaccordancewithGAAP.Deferred taxassetsrepresentamountsavailabletoreduceincometaxespayableinfutureyears.Theseassetsarisebecauseof temporarydifferencesbetweenthefinancialreportingandtaxbasesofassetsandliabilities,aswellasfromnetoperating lossesandtaxcreditcarryforwards.Theseamountsareadjusted,asappropriate,toreflectchangesintaxratesexpected tobeineffectwhenthetemporarydifferencesreverse.Weevaluatetherealizabilityofthesefuturetaxdeductionsand creditsbyassessingtheperiodoverwhichrecoverabilityisallowedbylawandtheadequacyoffutureexpectedtaxable incomefromallsources,includingreversaloftaxabletemporarydifferences,forecastedoperatingearningsandavailable taxplanningstrategies.Ourassessmentofthesesourcesofincomereliesheavilyonestimates.Ourforecastedearnings byjurisdictionaredeterminedbyhowweoperateourbusinessandanychangestoouroperationsmayaffectour effectivetaxrate.Forexample,ourfutureincometaxratecouldbeadverselyaffectedbyearningsbeinglowerthan anticipatedinjurisdictionsinwhichwehavesignificantdeferredtaxassetsthataredependentonsuchearningstobe realized.Weuseourhistoricalexperienceandoperatingforecaststoevaluateexpectedfuturetaxableincome.Tothe extentwedonotconsideritmore-likely-than-notthatadeferredtaxassetwillberecovered,avaluationallowanceis establishedintheperiodwemakethatdetermination.

Wecalculateourcurrentanddeferredtaxprovisionbasedonestimatesandassumptionsthatcoulddifferfromthe actualresultsreflectedinincometaxreturnsfiledinsubsequentyears.Adjustmentsbasedonfiledreturnsarerecorded whenidentified.

Taxlawsandregulationsarecomplexandsubjecttodifferentinterpretationsbytaxpayersandgovernmental taxingauthorities.Wereviewourtaxpositionsquarterlyandadjustthebalancesifandasnewinformationbecomes available.Significantjudgmentisrequiredindeterminingourtaxexpenseandevaluatingourtaxpositions,including evaluatinguncertainties.Ourestimateofthepotentialoutcomeofanyuncertaintaxissueissubjecttoourassessmentof relevantfactsandcircumstancesexistingatthebalancesheetdate,takingintoconsiderationexistinglaws,regulations andpracticesofthegovernmentaltaxingauthoritiesexercisingjurisdictionoverouroperations.Werecognizeand measureouruncertaintaxpositionsfollowingthemore-likely-than-notthresholdforrecognitionandmeasurementfor taxpositionswetakeorexpecttotakeonataxreturn.

RefertoNote14,“TaxesBasedonIncome,”totheConsolidatedFinancialStatementsformoreinformation.

Long-TermIncentiveCompensation

ValuationofStock-BasedAwards

Webaseourstock-basedcompensationexpenseonthefairvalueofawards,adjustedforestimatedforfeitures, amortizedonastraight-linebasisovertherequisiteserviceperiodforstockoptionsandrestrictedstockunits(“RSUs”). Webasecompensationexpenseforperformanceunits(“PUs”)onthefairvalueofawards,adjustedforestimated forfeitures,andamortizedonastraight-linebasisastheseawardscliff-vestattheendoftherequisiteperformance period.Webasecompensationexpenserelatedtomarket-leveragedstockunits(“MSUs”)onthefairvalueofawards, adjustedforestimatedforfeitures,andamortizedonagraded-vestingbasisovertheirrespectiveperformanceperiods.

Compensationexpenseforawardswithamarketconditionasaperformanceobjective,whichincludesPUsand MSUs,isnotadjustediftheconditionisnotmet,aslongastherequisiteserviceperiodismet.

WedeterminethefairvalueofRSUsandthecomponentofPUsthatissubjecttotheachievementofa performanceobjectivebasedonafinancialperformanceconditionbasedonthefairmarketvalueofourcommonstockas ofthedateofthegrant,adjustedforforegonedividends.OvertheperformanceperiodofthePUs,theestimatednumber ofsharesofourcommonstockissuableuponvestingisadjustedupwardordownwardbasedontheprobabilityof achievingtheperformanceobjectivesestablishedfortheaward.

Wedeterminethefairvalueofstock-basedawardsthataresubjecttoachievementofperformanceobjectives basedonamarketcondition,whichincludesMSUsandtheothercomponentofPUs,usingtheMonte-Carlosimulation model,whichutilizesmultipleinputvariables,includingexpectedstockpricevolatilityandotherassumptionsappropriate fordeterminingfairvalue,toestimatetheprobabilityofsatisfyingtherespectivetargetperformanceobjectives establishedfortheaward.

ForfeitureRate

Changesinestimatedforfeitureratesarerecordedascumulativeadjustmentsintheperiodestimatesarerevised.

Certainofourassumptionsarebasedonmanagement’sestimates,inconsultationwithoutsidespecialists. Significantchangesinassumptionsforfutureawardsandactualforfeitureratescouldmateriallyimpactourstock-based compensationexpenseandresultsofoperations.

ValuationofCash-BasedAwards

Cash-basedawardsconsistoflong-termincentiveunits(“LTIUnits”)grantedtoeligibleemployees.LTIUnitsare classifiedasliabilityawardsandremeasuredateachquarter-endovertheapplicablevestingorperformanceperiod.In additiontoLTIUnitswithtermsandconditionsthatmirrorthoseofRSUs,wealsograntcertainemployeesLTIUnitswith termsandconditionssimilartothoseofPUsandMSUs.

RECENTACCOUNTINGREQUIREMENTS

RefertoNote1,“SummaryofSignificantAccountingPolicies,”totheConsolidatedFinancialStatementsforthis information.

Item7A.QUANTITATIVEANDQUALITATIVEDISCLOSURESABOUTMARKETRISK

RiskManagement

Weareexposedtotheimpactofchangesinforeigncurrencyexchangeratesandinterestrates.Wegenerallydo notpurchaseorholdforeigncurrencyorinterestrateorcommoditycontractsfortradingpurposes.

Ourobjectiveinmanagingourexposuretoforeigncurrencychangesistoreducetherisktoourearningsandcash flowassociatedwithforeignexchangeratechanges.Asaresult,weenterintoforeignexchangeforward,optionand swapcontractstoreducerisksassociatedwiththevalueofourexistingforeigncurrencyassets,liabilities,firm commitmentsandanticipatedforeignrevenuesandcosts,whenavailableandappropriate.Thegainsandlossesonthese contractsareintendedtooffsetchangesintherelatedexposures.Wedonothedgeourforeigncurrencytranslation exposureinamannerthatwouldentirelyeliminatetheeffectsofchangesinforeignexchangeratesonournetincome.

Ourobjectiveinmanagingourexposuretointerestratechangesistoreducetheimpactofinterestratechanges onearningsandcashflows.Toachievethisobjective,wemayperiodicallyuseinterestratecontractstomanageour exposuretointerestratechanges.

Additionally,weenterintocertainnaturalgasfuturescontractstoreducetherisksassociatedwithnaturalgaswe anticipateusinginourmanufacturingoperations.Theseamountsarenotmaterialtoourfinancialstatements.

Inthenormalcourseofoperations,wealsofaceotherrisksthatareeithernon-financialornon-quantifiable.These risksprincipallyincludechangesineconomicorpoliticalconditions,otherrisksassociatedwithinternationaloperations, commoditypricerisk,andlegalandcompliancerisk,whicharenotreflectedintheanalysesdescribedbelow.

ForeignExchangeValue-At-Risk

WeuseaValue-At-Risk(“VAR”)modeltodeterminetheestimatedmaximumpotentialone-daylossinearnings associatedwithourforeignexchangepositionsandcontracts.Thisapproachassumesthatmarketratesorpricesfor foreignexchangepositionsandcontractsarenormallydistributed.VARmodelestimatesaremadeassumingnormal marketconditions.Themodelincludesforeignexchangederivativecontracts.Forecastedtransactions,firmcommitments, accountsreceivableandaccountspayabledenominatedinforeigncurrencies,whichcertainoftheseinstrumentsare intendedtohedge,areexcludedfromthemodel.

TheVARmodelisariskanalysistoolanddoesnotrepresentactuallossesinfairvaluethatwecouldincur,nor doesitconsiderthepotentialeffectoffavorablechangesinmarketfactors.

Inboth2023and2022,theVARwasestimatedusingavariance-covariancemethodology.Thecurrency correlationwasbasedonone-yearhistoricaldataobtainedfromoneofourdomesticbanks.A95%confidencelevelwas usedforaone-daytimehorizon.

Theestimatedmaximumpotentialone-daylossinearningsforourforeignexchangepositionsandcontractswas notsignificantatyear-end2023or2022.

InterestRateSensitivity

In2023and2022,anassumed41and12basispoint,respectively,increaseininterestratesaffectingour variable-rateborrowings(10%ofourweightedaverageinterestrateonfloatingratedebt)wouldnothavehada significantimpactoninterestexpense.

ReportofIndependentRegisteredPublicAccountingFirm

TotheBoardofDirectorsandShareholdersofAveryDennisonCorporation

OpinionsontheFinancialStatementsandInternalControloverFinancialReporting

WehaveauditedtheaccompanyingconsolidatedbalancesheetsofAveryDennisonCorporationandits subsidiaries(the“Company”)asofDecember30,2023andDecember31,2022,andtherelatedconsolidatedstatements ofincome,ofcomprehensiveincome,ofshareholders’equityandofcashflowsforeachofthethreeyearsintheperiod endedDecember30,2023,includingtherelatednotes(collectivelyreferredtoasthe“consolidatedfinancialstatements”). WealsohaveauditedtheCompany’sinternalcontroloverfinancialreportingasofDecember30,2023,basedoncriteria establishedin InternalControl–IntegratedFramework(2013) issuedbytheCommitteeofSponsoringOrganizationsof theTreadwayCommission(COSO).

Inouropinion,theconsolidatedfinancialstatementsreferredtoabovepresentfairly,inallmaterialrespects,the financialpositionoftheCompanyasofDecember30,2023andDecember31,2022,andtheresultsofitsoperationsand itscashflowsforeachofthethreeyearsintheperiodendedDecember30,2023inconformitywithaccountingprinciples generallyacceptedintheUnitedStatesofAmerica.Alsoinouropinion,theCompanymaintained,inallmaterialrespects, effectiveinternalcontroloverfinancialreportingasofDecember30,2023,basedoncriteriaestablishedin Internal Control–IntegratedFramework(2013) issuedbytheCOSO.

BasisforOpinions

TheCompany’smanagementisresponsiblefortheseconsolidatedfinancialstatements,formaintainingeffective internalcontroloverfinancialreporting,andforitsassessmentoftheeffectivenessofinternalcontroloverfinancial reporting,includedinManagement’sReportonInternalControlOverFinancialReportingappearingunderItem9A.Our responsibilityistoexpressopinionsontheCompany’sconsolidatedfinancialstatementsandontheCompany’sinternal controloverfinancialreportingbasedonouraudits.WeareapublicaccountingfirmregisteredwiththePublicCompany AccountingOversightBoard(UnitedStates)(PCAOB)andarerequiredtobeindependentwithrespecttotheCompany inaccordancewiththeU.S.federalsecuritieslawsandtheapplicablerulesandregulationsoftheSecuritiesand ExchangeCommissionandthePCAOB.

WeconductedourauditsinaccordancewiththestandardsofthePCAOB.Thosestandardsrequirethatweplan andperformtheauditstoobtainreasonableassuranceaboutwhethertheconsolidatedfinancialstatementsarefreeof materialmisstatement,whetherduetoerrororfraud,andwhethereffectiveinternalcontroloverfinancialreportingwas maintainedinallmaterialrespects.

Ourauditsoftheconsolidatedfinancialstatementsincludedperformingprocedurestoassesstherisksofmaterial misstatementoftheconsolidatedfinancialstatements,whetherduetoerrororfraud,andperformingproceduresthat respondtothoserisks.Suchproceduresincludedexamining,onatestbasis,evidenceregardingtheamountsand disclosuresintheconsolidatedfinancialstatements.Ourauditsalsoincludedevaluatingtheaccountingprinciplesused andsignificantestimatesmadebymanagement,aswellasevaluatingtheoverallpresentationoftheconsolidated financialstatements.Ourauditofinternalcontroloverfinancialreportingincludedobtaininganunderstandingofinternal controloverfinancialreporting,assessingtheriskthatamaterialweaknessexists,andtestingandevaluatingthedesign andoperatingeffectivenessofinternalcontrolbasedontheassessedrisk.Ourauditsalsoincludedperformingsuchother proceduresasweconsiderednecessaryinthecircumstances.Webelievethatourauditsprovideareasonablebasisfor ouropinions.

DefinitionandLimitationsofInternalControloverFinancialReporting

Acompany’sinternalcontroloverfinancialreportingisaprocessdesignedtoprovidereasonableassurance regardingthereliabilityoffinancialreportingandthepreparationoffinancialstatementsforexternalpurposesin accordancewithgenerallyacceptedaccountingprinciples.Acompany’sinternalcontroloverfinancialreportingincludes thosepoliciesandproceduresthat(i)pertaintothemaintenanceofrecordsthat,inreasonabledetail,accuratelyandfairly reflectthetransactionsanddispositionsoftheassetsofthecompany;(ii)providereasonableassurancethattransactions arerecordedasnecessarytopermitpreparationoffinancialstatementsinaccordancewithgenerallyacceptedaccounting principles,andthatreceiptsandexpendituresofthecompanyarebeingmadeonlyinaccordancewithauthorizationsof managementanddirectorsofthecompany;and(iii)providereasonableassuranceregardingpreventionortimely 44 2023AnnualReport | AveryDennisonCorporation

detectionofunauthorizedacquisition,use,ordispositionofthecompany’sassetsthatcouldhaveamaterialeffectonthe financialstatements.

Becauseofitsinherentlimitations,internalcontroloverfinancialreportingmaynotpreventordetect misstatements.Also,projectionsofanyevaluationofeffectivenesstofutureperiodsaresubjecttotheriskthatcontrols maybecomeinadequatebecauseofchangesinconditions,orthatthedegreeofcompliancewiththepoliciesor proceduresmaydeteriorate.

CriticalAuditMatters

Thecriticalauditmattercommunicatedbelowisamatterarisingfromthecurrentperiodauditoftheconsolidated financialstatementsthatwascommunicatedorrequiredtobecommunicatedtotheauditcommitteeandthat(i)relates toaccountsordisclosuresthatarematerialtotheconsolidatedfinancialstatementsand(ii)involvedourespecially challenging,subjective,orcomplexjudgments.Thecommunicationofcriticalauditmattersdoesnotalterinanywayour opinionontheconsolidatedfinancialstatements,takenasawhole,andwearenot,bycommunicatingthecriticalaudit matterbelow,providingaseparateopiniononthecriticalauditmatterorontheaccountsordisclosurestowhichit relates.

RevenueRecognitionfromCertainProductRevenue

AsdescribedinNotes1and15totheconsolidatedfinancialstatements,revenueisrecognizedforanamountthat reflectstheconsiderationwhichisexpectedfromthesaleofproductswhentheCompanysatisfiesaperformance obligationbytransferringcontrolofproductstoacustomer.Managementconsidersanumberoffactorsindetermining whencontrolhasbeentransferredtoacustomer,includingthefollowing:(i)theCompany’spresentrighttopayment; (ii)thecustomer’slegaltitletotheasset;(iii)physicalpossessionoftheasset;(iv)thecustomer’ssignificantrisksand rewardsofownershipoftheasset;and(v)thecustomer’sacceptanceoftheasset.Controlgenerallytransferstoa customeratapointintimeuponshipmentordelivery,dependingonthespecifictermsofsalewiththecustomer.The Company’sconsolidatednetsaleswere$8,364.3millionfortheyearendedDecember30,2023,ofwhichamajority relatestocertainproductrevenueintheCompany’sMaterialsGroupandSolutionsGroupreportablesegments.

Theprincipalconsiderationforourdeterminationthatperformingproceduresrelatingtorevenuerecognitionfrom certainproductrevenueisacriticalauditmatterisahighdegreeofauditoreffortinperformingproceduresrelatedtothe Company’srevenuerecognitionfromcertainproductrevenue.

Addressingthematterinvolvedperformingproceduresandevaluatingauditevidenceinconnectionwithforming ouroverallopinionontheconsolidatedfinancialstatements.Theseproceduresincludedtestingtheeffectivenessof controlsrelatingtotherevenuerecognitionprocess,includingcontrolsovertherecognitionofcertainproductrevenueas theamountofconsiderationwhichisexpectedfromthesaleofproductswhentheCompanysatisfiesaperformance obligation.Theseproceduresalsoincluded,amongothers(i)testingthecompleteness,accuracy,andoccurrenceof revenuerecognizedforasampleofrevenuetransactionsbyobtainingandinspectingsourcedocuments,suchas purchaseorders,invoices,contracts,proofofshipment,andsubsequentpaymentreceiptsand(ii)confirmingasampleof outstandingcustomerinvoicebalancesasofDecember30,2023and,forconfirmationsnotreturned,obtainingand inspectingsourcedocuments,suchasinvoices,proofofshipment,andsubsequentpaymentreceipts.

/s/PricewaterhouseCoopersLLP

LosAngeles,California

February21,2024

WehaveservedastheCompany’sauditorsinceatleast1960,whichweretheCompany’sfirstfinancial statementssubjecttoSECreportingrequirements.Wehavenotbeenabletodeterminethespecificyearwebegan servingasauditoroftheCompanyorapredecessorcompany.

ConsolidatedBalanceSheets

Commitmentsandcontingencies(seeNotes7and8)

Shareholders’equity:

Commonstock,$1parvaluepershare,authorized–400,000,000sharesatyear-end 2023and2022;issued–124,126,624sharesatyear-end2023and2022; outstanding–80,495,585and80,810,016sharesatyear-end2023and2022,

SeeNotestoConsolidatedFinancialStatements

ConsolidatedStatementsofComprehensiveIncome

Othercomprehensiveincome(loss),netoftax:

Pensionandotherpostretirementbenefits:

ConsolidatedStatementsofShareholders’Equity

(Dollarsinmillions,exceptpershareamounts)

BalanceasofJanuary2,2021$124.1$862.1$3,349.3$(2,501.0)$(349.6)$1,484.9

Netincome——740.1——740.1

Othercomprehensiveincome(loss),netoftax ————66.766.7

Repurchaseof925,425sharesfortreasury———(180.9)—(180.9)

Issuanceof257,189sharesunderstock-based compensationplans—.2(7.2)16.6—9.6

Contributionof123,015sharesto401(k)plan——19.15.5—24.6

Dividendsof$2.66pershare——(220.6)——(220.6)

BalanceasofJanuary1,2022$124.1$862.3$3,880.7$(2,659.8)$(282.9)$1,924.4

Netincome——757.1——757.1

Othercomprehensiveincome(loss),netoftax ————(81.1)(81.1)

Repurchaseof2,173,416sharesfortreasury———(379.5)—(379.5)

Issuanceof223,676sharesunderstock-based compensationplans—17.0(4.4)10.6—23.2

Contributionof153,803sharesto401(k)plan——20.16.9—27.0

Dividendsof$2.93pershare——(238.9)——(238.9)

BalanceasofDecember31,2022$124.1$879.3$4,414.6$(3,021.8)$(364.0)$2,032.2

Netincome——503.0——503.0

Othercomprehensiveincome(loss),netoftax ————(44.1)(44.1)

Repurchaseof780,721sharesfortreasury———(137.5)—(137.5)

Issuanceof297,885sharesunderstock-based compensationplans—(24.8)8.916.5—.6

Contributionof168,404sharesto401(k)plan——22.08.4—30.4

Dividendsof$3.18pershare——(256.7)——(256.7)

BalanceasofDecember30,2023$124.1$854.5$4,691.8$(3,134.4)$(408.1)$2,127.9

SeeNotestoConsolidatedFinancialStatements

ConsolidatedStatementsofCashFlows

OperatingActivities

Changesinassetsandliabilitiesandotheradjustments:

Tradeaccountsreceivable(16.7)(22.1)(113.2)

InvestingActivities

Purchasesofproperty,plantandequipment(265.3)(278.1)(255.0)

Purchasesofsoftwareandotherdeferredcharges(19.8)(20.4)(17.1)

Proceedsfromcompany-ownedlifeinsurancepolicies48.1——

Proceedsfromsalesofproperty,plantandequipment1.02.31.1

Proceedsfrominsuranceandsales(purchases)ofinvestments,net1.91.93.1

Proceedsfromsaleofproductlineandventureinvestment—1.17.6

Paymentsforacquisitions,netofcashacquired,andventureinvestments(224.9)(39.5)(1,477.6)

Netcashusedininvestingactivities(459.0)(332.7)(1,737.9)

FinancingActivities

Netincrease(decrease)inborrowingswithmaturitiesofthreemonthsorless(36.6)34.6259.2

Additionallong-termborrowings394.9—791.7

Repaymentsoflong-termdebtandfinanceleases(255.9)(6.3)(13.4)

Dividendspaid (256.7)(238.9)(220.6)

Sharerepurchases(137.5)(379.5)(180.9)

Net(taxwithholding)proceedsrelatedtostock-basedcompensation(23.8)(25.1)(25.4)

Other (1.6)—(6.3)

Netcash(usedin)providedbyfinancingactivities(317.2)(615.2)604.3

Effectofforeigncurrencytranslationoncashbalances(2.0)(8.6)(2.8)

Increase(decrease)incashandcashequivalents47.84.5(89.6)

Cashandcashequivalents,beginningofyear167.2162.7252.3

Cashandcashequivalents,endofyear$215.0$167.2$162.7

SeeNotestoConsolidatedFinancialStatements

NotestoConsolidatedFinancialStatements

NOTE1.SUMMARYOFSIGNIFICANTACCOUNTINGPOLICIES

NatureofOperations

Weareaglobalmaterialsscienceanddigitalidentificationsolutionscompanythatprovidesawiderangeof brandingandinformationsolutionsthatoptimizelaborandsupplychainefficiency,reducewaste,advancesustainability, circularityandtransparency,andbetterconnectbrandsandconsumers.Ourproductsandsolutionsincludelabelingand functionalmaterials,radio-frequencyidentification(“RFID”)inlaysandtags,softwareapplicationsthatconnectthe physicalanddigital,andavarietyofproductsandsolutionsthatenhancebrandedpackagingandcarryordisplay informationthatimprovesthecustomerexperience.Weserveanarrayofindustriesworldwide,includinghomeand personalcare,apparel,generalretail,e-commerce,logistics,foodandgrocery,pharmaceuticalsandautomotive.

PrinciplesofConsolidation

OurConsolidatedFinancialStatementsincludetheaccountsofmajority-ownedandcontrolledsubsidiaries. Intercompanyaccounts,transactionsandprofitsareeliminatedinconsolidation.

FiscalYear

Ourfiscalyearsgenerallyconsistof52weeks,buteveryfifthorsixthfiscalyearconsistsof53weeks;our2023, 2022,and2021fiscalyearsconsistedof52-weekperiodsendingDecember30,2023,December31,2022and January1,2022,respectively.

AccountingGuidanceUpdates

SupplierFinancePrograms

Inthefirstquarterof2023,weadoptedguidancethatrequiresdisclosuresofkeysupplierfinanceprogramterms, informationaboutobligationsundertheseprogramsandarollforwardoftheseobligations.Thisguidancewaseffective forfiscalyearsbeginningafterDecember15,2022,includinginterimperiodswithinthosefiscalyears,exceptforthe disclosureonrollforwardinformation,whichiseffectiveforfiscalyearsbeginningafterDecember15,2023.SeeNote16, “SupplementalFinancialInformation,”formoreinformation.

UseofEstimates

ThepreparationoffinancialstatementsinconformitywithaccountingprinciplesgenerallyacceptedintheUnited StatesofAmerica,orGAAP,requiresmanagementtomakeestimatesandassumptionsforthereportingperiodandasof thedateofourfinancialstatements.Theseestimatesandassumptionsaffectthereportedamountsofassetsand liabilities,thedisclosureofcontingentliabilitiesandthereportedamountsofrevenueandexpense.Astheeffectsof futureeventscannotbedetermined,actualresultscoulddiffersignificantlyfromthoseestimates.

CashandCashEquivalents

Cashandcashequivalentsgenerallyconsistofcashonhand,depositsinbanks,cash-in-transit,andbankdrafts andshort-terminvestmentswithmaturitiesofthreemonthsorlesswhenpurchasedorreceived.Thecarryingvalueof theseassetsapproximatesfairvalueduetotheshortmaturityoftheseinstruments.

Inventories

Westateinventoriesatthelowerofcostornetrealizablevalueandcategorizethemasrawmaterials,work-inprogress,orfinishedgoods.Costisdeterminedusingthefirst-in,first-outmethod.Werecordinventorythatisdamaged, obsolete,excessandslow-movingtocostofproductssoldandweestablishalowercostbasisfortheinventory.Slowmovinginventoryisreviewedbycategoryandmayberecognizedpartiallyorfullytocostofproductssolddependingon thetypeofproduct,levelofusageandlengthoftimetheproducthasbeenincludedininventory.

TradeAccountsReceivable

Werecordtradeaccountsreceivableattheinvoicedamount.Ourallowanceforcreditlossesreflectscustomer tradeaccountsreceivablethatareestimatedtobepartiallyorentirelyuncollectible.Theseallowancesareusedtoreduce

grosstradereceivablestotheirnetrealizablevalues.Werecordtheseallowancesbasedonestimatesrelatedtothe following:

•Thefinancialconditionofcustomers;

•Theagingofreceivablebalances;

•Ourhistoricalcollectionexperience;and

•Currentandexpectedfuturemacroeconomicandmarketconditions.

Property,PlantandEquipment

Wegenerallycomputedepreciationusingthestraight-linemethodovertheestimatedusefullivesofthe respectiveassets,rangingfromtento45yearsforbuildingsandimprovementsandthreeto15yearsformachineryand equipment.Leaseholdimprovementsaredepreciatedovertheshorteroftheusefullifeoftheassetorthetermofthe associatedleases.Weexpensemaintenanceandrepaircostsasincurred;wecapitalizerenewalsandimprovements. Uponthesaleorretirementofassets,theaccountsarerelievedofthecostandtherelatedaccumulateddepreciation,with anyresultinggainorlossincludedinnetincome.

Leases

Ourleasesprimarilyrelatetoofficeandwarehousespace,machinery,transportation,andequipmentfor informationtechnology.Wedetermineifanarrangementisaleaseorcontainsaleaseatinception.Forleaseaccounting purposes,wedonotseparateleaseandnonleasecomponents,nordowerecordoperatingorfinanceleaseassetsand liabilitiesforshort-termleases.Wehaveoptionstoreneworterminatesomeofourleases.Weevaluaterenewaland terminationoptionsbasedonconsiderationsavailableattheleasecommencementdateandovertheleasetermto determineifwearereasonablycertaintoexercisetheseoptions.Asmostofourleasesdonotprovideanimplicitrate,we useourincrementalborrowingratebasedontheinformationavailableattheleasecommencementdatetodeterminethe presentvalueofleasepayments.Werecognizeexpenseforoperatingleasesonastraight-linebasisovertheleaseterm, withvariableleasepaymentsrecognizedintheperiodsinwhichtheyareincurred.

Software

Wecapitalizesoftwarecostsincurredduringtheapplicationdevelopmentstageofsoftwaredevelopment, includingcostsincurredfordesign,coding,installationtohardware,testing,andupgradesandenhancementsthat providethesoftwareorhardwarewithadditionalfunctionalitiesandcapabilities.Weexpensesoftwarecosts,including internalandexternaltrainingcostsandmaintenancecosts,incurredduringthepreliminaryprojectstageandthepostimplementationand/oroperationstage.Inaddition,wecapitalizeimplementationcostsincurredunderahosting arrangementthatisaservicecontract.Capitalizedsoftware,whichisincludedin“Otherassets”intheConsolidated BalanceSheets,isamortizedonastraight-linebasisovertheestimatedusefullifeofthesoftware,whichisgenerally betweenfiveandtenyears.

VentureInvestments

Weinvestinprivatelyheldcompaniesandutilizethemeasurementalternativeforequityinvestmentsthatdonot havereadilydeterminablefairvalues,measuringthematcostlessimpairmentplusorminusobservablepricechangesin orderlytransactions.Thecarryingvalueofourventureinvestmentsisincludedin“Otherassets”intheConsolidated BalanceSheets.

SeeNote9,“FairValueMeasurements,”formoreinformation.

ImpairmentofLong-livedAssets

Werecordimpairmentchargeswhenthecarryingamountsoflong-livedassetsaredeterminednottobe recoverable.Wemeasurerecoverabilitybycomparingtheundiscountedcashflowsexpectedfromtheapplicableassetor assetgroup’suseandeventualdispositiontoitscarryingvalue.Wecalculatetheamountofimpairmentlossasthe excessofthecarryingvalueoverthefairvalue.Historically,changesinmarketconditionsandmanagementstrategyhave causedustoreassessthecarryingamountofourlong-livedassets. 52

GoodwillandOtherIntangiblesResultingfromBusinessAcquisitions

Weaccountforbusinesscombinationsusingtheacquisitionmethod,withtheexcessoftheacquisitioncostover thefairvalueofnettangibleassetsandidentifiedintangibleassetsacquiredconsideredgoodwill.Asaresult,wedisclose goodwillseparatelyfromotherintangibleassets.Otheridentifiableintangiblesincludecustomerrelationships,patented andotherdevelopedtechnology,andtradenamesandtrademarks.

Weperformanannualimpairmenttestofgoodwillduringthefourthquarterand,asnecessary,ifchangesinfacts andcircumstancesthatindicatethefairvalueofareportingunitmaybelessthanitscarryingvalue.Factorsthatmay causeustoperformanimpairmenttestoutsideofourannualassessmentincludesignificantunderperformanceofa businessrelativetoexpectedoperatingresults,significantadverseeconomicandindustrytrends,significantdeclinein ourmarketcapitalizationforanextendedperiodoftimerelativetonetbookvalue,orourdecisiontodivestaportionofa reportingunit.Inperformingimpairmenttests,wehavetheoptiontofirstassessqualitativefactorstodeterminewhether itisnecessarytoperformaquantitativeassessmentforgoodwillimpairment.Ifthequalitativeassessmentindicatesthat itismore-likely-than-notthatthefairvalueofareportingunitislessthanitscarryingvalue,weperformaquantitative assessment.Aquantitativeassessmentprimarilyusesthepresentvalue(discountedcashflow)methodtodeterminethe fairvalueofreportingunitswithgoodwill.

Wecomparethefairvalueofeachreportingunittoitscarryingamount,and,totheextentthecarryingamount exceedstheunit’sfairvalue,werecognizeanimpairmentofgoodwillfortheexcessuptotheamountofgoodwillofthat reportingunit.

Inconsultationwithoutsidespecialists,weestimatethefairvalueofourreportingunitsusingvariousvaluation techniques,withtheprimarytechniquebeingadiscountedcashflowanalysis.Adiscountedcashflowanalysisrequires ustomakevariousassumptionsaboutourreportingunits,includingtheirrespectiveforecastedsales,operatingmargins andgrowthrates,aswellasdiscountrates.Ourassumptionsaboutdiscountratesarebasedontheweightedaverage costofcapitalforcomparablecompanies.Ourassumptionsaboutsales,operatingmarginsandgrowthratesarebasedon ourforecasts,businessplans,economicprojections,anticipatedfuturecashflows,andmarketplacedata.Wealsomake assumptionsforvaryingperpetualgrowthratesforperiodsbeyondourlong-termbusinessplanperiod.Webaseourfair valueestimatesonprojectedfinancialinformationandassumptionsthatwebelievearereasonable.However,actual futureresultsmaydiffermateriallyfromtheseestimatesandprojections.Thevaluationmethodologyweusetoestimate thefairvalueofreportingunitsrequiresinputsandassumptionsthatreflectcurrentmarketconditions,aswellasthe impactofplannedbusinessandoperationalstrategiesthatrequiremanagementjudgment.Theestimatedfairvaluecould increaseordecreasedependingonchangesintheinputsandassumptions.

Wetestindefinite-livedintangibleassets,consistingoftradenamesandtrademarks,forimpairmentinthefourth quarterorwhenevereventsorcircumstancesindicatethatitismore-likely-than-notthattheircarryingamountsexceed theirfairvalues.Inperformingtheimpairmenttests,wehavetheoptionfirsttoassessqualitativefactorstodetermine whetheritisnecessarytoperformaquantitativeassessmentforindefinite-livedintangibleassetimpairment.Ifwedecide nottoperformaqualitativeassessment,orifthequalitativeassessmentindicatesthatitismore-likely-than-notthatthe fairvalueofanindefinite-livedintangibleassetislessthanitscarryingvalue,weperformaquantitativeassessment.Fair valueisestimatedasthediscountedvalueoffuturerevenuesusingaroyaltyratethatathirdpartywouldpaytousethe asset.Variationintheroyaltyratescouldimpactourestimateoffairvalue.Ifthecarryingamountofanassetexceedsits fairvalue,animpairmentlossisrecognizedinanamountequaltothatexcess.

Weamortizefinite-livedintangibleassets,consistingofcustomerrelationships,patentedandotherdeveloped technology,tradenamesandtrademarks,andotherintangibles,onastraight-linebasisovertheirestimatedusefullives.

SeeNote3,“GoodwillandOtherIntangiblesResultingfromBusinessAcquisitions,”formoreinformation.

ForeignCurrency

WetranslateassetandliabilityaccountsofinternationaloperationsintoU.S.dollarsatcurrentrates.Revenuesand expensesaretranslatedattheweightedaveragecurrencyrateforthefiscalyear.Werecordgainsandlossesresulting fromhedgingthevalueofinvestmentsincertaininternationaloperationsandfromthetranslationofbalancesheet accountsdirectlyasacomponentofothercomprehensiveincome.

WeaccountforouroperationsinArgentinaashighlyinflationary,becausethecountry’sthree-yearcumulative inflationrateexceeds100%.Asaresult,thefunctionalcurrencyofourArgentinesubsidiaryistheU.S.dollar.

FinancialInstruments

Weenterintoforeignexchangederivativecontractstoreduceourriskfromexchangeratefluctuationsassociated withreceivables,payables,loansandfirmcommitmentsdenominatedincertainforeigncurrenciesthatariseprimarilyasa resultofouroperationsoutsidetheU.S.Fromtimetotime,weenterintointerestratecontractstohelpmanageour exposuretocertaininterestratefluctuations.Wealsoenterintofuturescontractstohedgecertainpricefluctuationsfora portionofouranticipateddomesticpurchasesofnaturalgas.Themaximumlengthoftimeforwhichwehedgeour exposuretothevariabilityinfuturecashflowsis36monthsforforecastedforeignexchangeandcommoditytransactions and10yearsforcross-currencyswaptransactions.

Onthedateweenterintoaderivativecontract,wedeterminewhetherthederivativewillbedesignatedasa hedge.Derivativesdesignatedashedgesareclassifiedaseither(1)hedgesofthefairvalueofarecognizedassetor liabilityoranunrecognizedfirmcommitment(“fairvalue”hedges)or(2)hedgesofaforecastedtransactionorthe variabilityofcashflowsthataretobereceivedorpaidinconnectionwitharecognizedassetorliability(“cashflow” hedges).Otherderivativesnotdesignatedashedgesarerecordedonthebalancesheetsatfairvalue,withchangesinfair valuerecognizedinearnings.Ourpolicyisnottopurchaseorholdanyforeigncurrency,interestrateorcommodity contractsfortradingpurposes.

Weassess,bothattheinceptionofanyhedgeandonanongoingbasis,whetherourhedgesarehighlyeffective.If wedeterminethatahedgeisnothighlyeffective,weprospectivelydiscontinuehedgeaccounting.Forcashflowhedges, werecordgainsandlossesascomponentsofothercomprehensiveincomeandreclassifythemintoearningsinthesame periodduringwhichthehedgedtransactionaffectsearnings.Intheeventthattheanticipatedtransactionisnolonger likelytooccur,werecognizethechangeinfairvalueoftheinstrumentincurrentperiodearnings.Werecognizechanges infairvaluehedgesincurrentperiodearnings.Wealsorecognizechangesinthefairvalueofunderlyinghedgeditems (suchasrecognizedassetsorliabilities)incurrentperiodearningsandoffsetthechangesinthefairvalueofthe derivative.

IntheConsolidatedStatementsofCashFlows,hedgesareclassifiedinthesamecategoryastheitemhedged, primarilyinoperatingactivities.

SeeNote5,“FinancialInstruments,”formoreinformation.

FairValueMeasurements

Wedefinefairvalueasthepricethatwouldbereceivedfromsellinganassetorpaidfortransferringaliabilityin anorderlytransactionbetweenmarketparticipantsatthemeasurementdate.Indeterminingfairvalue,weconsiderthe principalormostadvantageousmarketinwhichwewouldtransactandthemarket-basedriskmeasurementsor assumptionsthatmarketparticipantswoulduseinpricingtheassetorliability.

Wedeterminefairvaluebasedonathree-tierfairvaluehierarchy,whichweusetoprioritizetheinputsusedin measuringfairvalue.ThesetiersconsistofLevel1,whichareobservableinputssuchasquotedpricesinactivemarkets; Level2,whichareinputsotherthanquotedpricesinactivemarketsthatareeitherdirectlyorindirectlyobservable;and Level3,whichareunobservableinputsinwhichlittleornomarketdataexists,requiringustodevelopourown assumptionstodeterminethebestestimateoffairvalue.

RevenueRecognition

Substantiallyallofourrevenueisderivedfromthesaleofproducts.OurMaterialsGroupreportablesegmentsells pressure-sensitivelabelmaterials,films,performancetapesandfasteners.OurSolutionsGroupreportablesegmentsells awidevarietyofbrandingandinformationsolutions-orientedproducts,suchastickets,tags,labels(includingRFID inlays),aswellasrelatedequipment,services,andsupplies,thatprovideourcustomerswithsolutionsforthemto optimizebrandingandengagementwiththeirconsumersandenableitemvisibilityandtraceability.Werecognize revenueforanamountthatreflectstheconsiderationwhichweexpectfromthesaleofourproductswhenwesatisfya performanceobligationbytransferringcontrolofourproductstoacustomer.Weconsideranumberoffactorsin determiningwhenwehavetransferredcontroltoacustomer,includingthefollowing:(i)ourpresentrighttopayment; (ii)thecustomer’slegaltitletotheasset;(iii)physicalpossessionoftheasset;(iv)thecustomer’ssignificantrisksand rewardsofownershipoftheasset;and(v)thecustomer’sacceptanceoftheasset.Generally,therearenosubstantive differencesinrevenuerecognitionconsiderationsamongourvariousproducts.Controlgenerallytransferstoacustomer atapointintimeuponshipmentordelivery,dependingonthespecifictermsofsalewiththecustomer.

Ourpaymenttermswithcustomersaregenerallyconsistentwiththoseusedintheindustriesandtheregionsin whichweoperate.

Weacceptsalesreturnsincertainlimitedcircumstances.Werecordaliabilityforestimatedreturnsanda correspondingreductiontosalesintheamountweexpecttorepayorcreditcustomers,whichwebaseonhistorical returnsandoutstandingcustomerclaims.Weupdateourestimateseachreportingperiod.

Salesrebates,discountsandothercustomerconcessionsrepresentvariableconsiderationandarecommoninthe industriesandregionsinwhichweoperate,whichweaccountforasareductiontosalesbasedonestimatesatthetime atwhichproductsaresold.Webasetheseestimatesonourhistoricalexperience,aswellascurrentinformationsuchas salesforecasts.Weregularlyreviewourestimatesandadjusttherevenuerecognizedfromsalesasnecessaryas additionalinformationbecomesavailable.

Weexcludesalestax,value-addedtaxandothertaxeswecollectfromcustomersfromsales.Weaccountfor shippingandhandlingactivitiesaftercontrolofaproductistransferredtoacustomerasfulfillmentcostsandnotas separateperformanceobligations.Asapracticalexpedient,wehaveelectednottodisclosethevalueofunsatisfied performanceobligationsforcontractswithanexpectedlengthoflessthanoneyear.Wegenerallyexpensesales commissionswhenincurredbecausetheexpectedamortizationperiodisoneyearorless.Werecordthesecostsin “Marketing,generalandadministrativeexpense”intheConsolidatedStatementsofIncome.

ResearchandDevelopment

Researchanddevelopmentcostsarerelatedtoresearch,designandtestingofnewproductsandapplications, whichweexpenseasincurred.

Long-TermIncentiveCompensation

Nolong-termincentivecompensationexpensewascapitalizedin2023,2022or2021.

ValuationofStock-BasedAwards

Webaseourstock-basedcompensationexpenseonthefairvalueofawards,adjustedforestimatedforfeitures, amortizedonastraight-linebasisovertherequisiteserviceperiodforstockoptionsandrestrictedstockunits(“RSUs”). Webasecompensationexpenseforperformanceunits(“PUs”)onthefairvalueofawards,adjustedforestimated forfeitures,andamortizedonastraight-linebasisastheseawardscliff-vestattheendoftherequisiteserviceperiod.We basecompensationexpenserelatedtomarket-leveragedstockunits(“MSUs”)onthefairvalueofawards,adjustedfor estimatedforfeitures,andamortizedonagraded-vestingbasisovertheirrespectiveperformanceperiods.

Compensationexpenseforawardswithamarketconditionasaperformanceobjective,whichincludesPUsand MSUs,isnotadjustediftheconditionisnotmet,aslongastherequisiteserviceperiodismet.

WeestimatethefairvalueofstockoptionsasofthedateofgrantusingtheBlack-Scholesoption-pricingmodel. Thismodelrequiresinputassumptionsforourexpecteddividendyield,expectedstockpricevolatility,risk-freeinterest rateandexpectedoptionterm.

WedeterminethefairvalueofRSUsandthecomponentofPUsthatissubjecttotheachievementofa performanceobjectiveusingafinancialperformanceconditionbasedonthefairmarketvalueofourcommonstockasof thedateofgrant,adjustedforforegonedividends.OvertheperformanceperiodofthePUs,theestimatednumberof sharesofourcommonstockissuableuponvestingisadjustedupwardordownwardfromthetargetsharesatthetimeof grantbasedontheprobabilityofthefinancialperformanceobjectivesestablishedfortheawardbeingachieved.

Wedeterminethefairvalueofstock-basedawardsthataresubjecttotheachievementofperformanceobjectives basedonamarketcondition,whichincludesMSUsandtheothercomponentofPUs,usingtheMonte-Carlosimulation method,whichutilizesmultipleinputvariables,includingexpectedstockpricevolatilityandotherassumptions appropriatefordeterminingfairvalue,toestimatetheprobabilityofsatisfyingthetargetperformanceobjectives establishedfortheaward.

Certainoftheseassumptionsarebasedonmanagement’sestimates,inconsultationwithoutsidespecialists. Significantchangesinassumptionsforfutureawardsandactualforfeitureratescouldmateriallyimpactstock-based compensationexpenseandourresultsofoperations.

ValuationofCash-BasedAwards

Cash-basedawardsconsistoflong-termincentiveunits(“LTIUnits”)grantedtoeligibleemployees.Weclassify LTIUnitsasliabilityawardsandremeasurethemateachquarter-endovertheapplicablevestingorperformanceperiod. InadditiontoLTIUnitswithtermsandconditionsthatmirrorthoseofRSUs,wealsograntcertainemployeesLTIUnits withtermsandconditionsthatmirrorthoseofPUsandMSUs.

Forfeitures

Weestimateexpectedforfeituresindeterminingthecompensationcosttoberecognizedeachperiod,ratherthan accountingforforfeituresastheyoccur.Werecordchangesinestimatedforfeitureratesascumulativeadjustmentsinthe periodestimatesarerevised.

SeeNote12,“Long-termIncentiveCompensation,”formoreinformation.

TaxesBasedonIncome

BecausewearesubjecttoincometaxintheU.S.andmultipleforeignjurisdictions,judgmentisrequiredin evaluatingandestimatingourworldwideprovision,accrualsfortaxes,deferredtaxesandtaxpositions.Ourprovisionfor incometaxesisdeterminedusingtheassetandliabilityapproachinaccordancewithGAAP.Underthisapproach, deferredtaxesrepresenttheexpectedfuturetaxconsequencesoftemporarydifferencesbetweenthecarryingamounts andtaxbasesofassetsandliabilities.Werecordavaluationallowancetoreduceourdeferredtaxassetswhen uncertaintyregardingtheirrealizabilityexists.Werecognizeandmeasureouruncertaintaxpositionsfollowingthemorelikely-than-notthresholdforrecognitionandmeasurementfortaxpositionswetakeorexpecttotakeonataxreturn.

SeeNote14,“TaxesBasedonIncome,”formoreinformation.

RecentAccountingRequirements

InNovember2023,theFinancialAccountingStandardsBoard(“FASB”)issuedguidancetoexpandannualand interimdisclosurerequirementsforreportablesegments,primarilythroughenhanceddisclosuresaboutsignificant segmentexpenses.TheguidanceiseffectiveforfiscalyearsbeginningafterDecember15,2023,andinterimperiods withinfiscalyearsbeginningafterDecember15,2024,withearlyadoptionpermitted.Wearecurrentlyassessingthe impactofadoptingthisguidanceonourfinancialstatementdisclosures.

InDecember2023,theFASBissuedguidanceonimprovementstoincometaxdisclosuresintheratereconciliation andincometaxespaid.TheguidanceiseffectiveforfiscalyearsbeginningafterDecember15,2024,withearlyadoption permitted.Wearecurrentlyassessingtheimpactofadoptingthisguidanceonourfinancialstatementdisclosures.

NOTE2.BUSINESSACQUISITIONS

2023BusinessAcquisitions

OnNovember23,2023,wecompletedourbusinessacquisitionofSilverCrystalGroup(“SilverCrystal”),a Canada-basedproviderofsportsapparelcustomizationandapplicationsolutionsacrossin-venue,direct-to-business ande-commerceplatforms.OnMay22,2023,wecompletedourbusinessacquisitionofLGGroup,Inc.(“LionBrothers”), aMaryland-baseddesignerandmanufacturerofapparelbrandembellishments.OnMarch6,2023,wecompletedour businessacquisitionofThermopatch,Inc.(“Thermopatch”),aNewYork-basedmanufacturerspecializinginlabeling, embellishmentsandtransfersforthesports,industriallaundry,workwearandhospitalityindustries.Theseacquisitions expandedtheproductportfolioinourSolutionsGroupreportablesegment.

TheacquisitionsofSilverCrystal,LionBrothersandThermopatcharereferredtocollectivelyasthe“2023 Acquisitions.”

Theaggregatepurchaseconsideration,includingpurchaseconsiderationpayable,forthe2023Acquisitionswas approximately$231million.Wefundedthe2023Acquisitionsusingcashandcommercialpaperborrowings.Inaddition tothecashpaidatclosing,thesellersinoneoftheseacquisitionsareeligibleforearn-outpaymentsofupto$5million, subjecttotheacquiredcompanyachievingcertainpost-acquisitionperformancetargets.Asoftheacquisitiondate,we includedanestimateofthefairvalueoftheseearn-outpaymentsintheaggregatepurchaseconsideration.

56 2023AnnualReport | AveryDennisonCorporation

Thefinalallocationsofpurchaseconsiderationforthe2023Acquisitionstoassetsandliabilitiesareongoingaswe continuetoevaluatecertainbalances,estimatesandassumptionsduringthemeasurementperiod(uptooneyearfrom theirrespectiveacquisitiondate).Consistentwiththeallowabletimetocompleteourassessment,thevaluationofcertain acquiredassetsandliabilities,includingenvironmentalliabilitiesandincometaxes,iscurrentlypendingfinalization.

The2023Acquisitionswerenotmaterial,individuallyorintheaggregate,totheConsolidatedFinancial Statements.

2022BusinessAcquisitions

InJanuary2022,wecompletedourbusinessacquisitionsofTexTraceAG(“TexTrace”),aSwitzerland-based technologydeveloperspecializingincustom-madewovenandknittedRFIDproductsthatcanbesewnontoorinserted intogarments,andRietveldSerigrafieB.V.andRietveldScreenprintingSerigrafiBaskiMatbaaTekstilIthalatIhracat SanayiveTicaretLimitedSirketi(collectively,“Rietveld”),aNetherlands-basedproviderofexternalembellishment solutionsandapplicationandprintingmethodsforperformancebrandsandteamsportsinEurope.Theseacquisitions expandedtheproductportfolioinourSolutionsGroupreportablesegment.TheacquisitionsofTexTraceandRietveldare referredtocollectivelyasthe“2022Acquisitions.”

Theaggregatepurchaseconsiderationforthe2022Acquisitionswasapproximately$35million.Wefundedthe 2022Acquisitionsusingcashandcommercialpaperborrowings.Inadditiontothecashpaidatclosing,thesellersinone oftheseacquisitionsareeligibleforearn-outpaymentsofupto$30million,subjecttotheacquiredcompanyachieving certainpost-acquisitionperformancetargets.Asoftheacquisitiondate,weincludedanestimateofthefairvalueof theseearn-outpaymentsintheaggregatepurchaseconsideration.

The2022Acquisitionswerenotmaterial,individuallyorintheaggregate,totheConsolidatedFinancial Statements.

VestcomAcquisition

OnAugust31,2021,wecompletedourbusinessacquisitionofCBVelocityHoldings,LLC(“Vestcom”),an Arkansas-basedproviderofshelf-edgepricing,productivityandconsumerengagementsolutionsforretailersand consumerpackagedgoodscompanies,forpurchaseconsiderationof$1.47billion.Wefundedthisacquisitionusingcash andproceedsfrombothcommercialpaperborrowingsandissuancesofseniornotes.RefertoNote4,“Debt,”tothe ConsolidatedFinancialStatementsformoreinformation.

Vestcom’ssolutionsexpandedourpositioninhigh-valuecategoriesandaddedchannelaccessanddata managementcapabilitiestoourSolutionsGroupreportablesegment.

TheimpactoftheVestcomacquisitionwasnotmaterialtotheproformanetsalesornetincomeofourcombined operationsfortheperiodspresented.Post-acquisitionnetsalesandnetincomerelatedtoVestcomwerenotmaterialto theConsolidatedStatementsofIncomefor2021.

Other2021BusinessAcquisitions

OnMarch18,2021,wecompletedourbusinessacquisitionofthenetassetsofZippyYum,LLC(“ZippyYum”),a California-baseddeveloperofsoftwareproductsusedinthefoodserviceandfoodpreparationindustries.Thisacquisition expandedtheproductportfolioinourSolutionsGroupreportablesegment.

OnMarch1,2021,wecompletedourbusinessacquisitionoftheissuedandoutstandingstockofJDCSolutions, Inc.(“JDC”),aTennessee-basedmanufacturerofpressure-sensitivespecialtytapes.Thisacquisitionexpandedthe productportfolioinourMaterialsGroupreportablesegment.

TheacquisitionsofZippyYumandJDCarereferredtocollectivelyasthe“Other2021Acquisitions.”

TheaggregatepurchaseconsiderationfortheOther2021Acquisitionswasapproximately$43million.Wefunded theOther2021Acquisitionsusingcashandcommercialpaperborrowings.Inadditiontothecashpaidatclosing,the sellersinoneoftheseacquisitionsareeligibleforearn-outpaymentsofuptoapproximately$13millionsubjecttothe acquiredcompany’sachievementofcertainpost-acquisitionperformancetargets.Asoftheacquisitiondate,we estimatedthefairvalueoftheseearn-outpaymentstobeapproximately$12million,whichwasincludedinthe $43millionofaggregatepurchaseconsideration.

TheOther2021Acquisitionswerenotmaterial,individuallyorintheaggregate,totheConsolidatedFinancial Statements.

NOTE3.GOODWILLANDOTHERINTANGIBLESRESULTINGFROMBUSINESSACQUISITIONS

Goodwill

Resultsfromourannualgoodwillimpairmenttestinthefourthquarterof2023indicatedthatnoimpairment occurredduring2023.TheassumptionsusedinourassessmentwereprimarilybasedonLevel3inputs.

Changesinthenetcarryingamountofgoodwillfor2023and2022byreportablesegmentareshownbelow:

(1) Goodwillacquiredrelatedtothe2022Acquisitions.Weexpecttherecognizedgoodwillrelatedtothe2022Acquisitionsnottobedeductiblefor incometaxpurposes.

(2) MeasurementperiodadjustmentrelatedtothefinalizationofthepurchasepriceallocationfortheVestcomacquisition.

(3) Goodwillacquiredrelatedtothe2023Acquisitions.Weexpectsubstantiallyalloftherecognizedgoodwillrelatedtothe2023Acquisitionsnottobe deductibleforincometaxpurposes.

ThecarryingamountsofgoodwillatDecember30,2023andDecember31,2022werenetofaccumulated impairmentlossesof$820millionrecognizedinfiscalyear2009byourSolutionsGroupreportablesegment.

Indefinite-LivedIntangibleAssets

Resultsfromourannualindefinite-livedintangibleassetsimpairmenttestinthefourthquarterindicatedthatno impairmentoccurredin2023.Thecarryingvalueofindefinite-livedintangibleassetsresultingfrombusinessacquisitions, consistingoftradenamesandtrademarks,was$155.3millionand$154.7millionatDecember30,2023and December31,2022,respectively.

Finite-LivedIntangibleAssets

Inconnectionwiththe2023Acquisitions,weacquiredapproximately$94millionofidentifiablefinite-lived intangibleassets,whichconsistedofcustomerrelationships,patentedandotherdevelopedtechnology,andtradenames andtrademarks.Weutilizedtheincomeapproachtoestimatethefairvalueofacquiredidentifiableintangibles,primarily usingLevel3inputs.Weappliedsignificantjudgmentindeterminingthefairvalueofintangibleassets,whichincluded ourestimatesandassumptionswithrespecttoestimatedfuturerevenueandrelatedprofitmargins,customerretention rates,technologymigrationcurves,royaltyrates,discountratesandeconomiclivesassignedtotheacquiredintangible assets.

Thetablebelowsummarizestheamountsandweightedaverageusefullivesoftheintangibleassetsassociated withthe2023Acquisitionsasoftheacquisitiondate.

Inconnectionwiththe2022Acquisitions,weacquiredapproximately$21millionofidentifiablefinite-lived intangibleassets,whichconsistedofpatentedandotherdevelopedtechnologyaswellascustomerrelationships.

RefertoNote2,“BusinessAcquisitions,”formoreinformation.

Thetablebelowsetsforthourfinite-livedintangibleassetsresultingfrombusinessacquisitionsatDecember30, 2023andDecember31,2022,whichcontinuetobeamortized.

Amortizationexpenseforfinite-livedintangibleassetsresultingfrombusinessacquisitionswas$86.3millionfor 2023,$81.8millionfor2022and$44.6millionfor2021.

Weexpectestimatedamortizationexpenseforfinite-livedintangibleassetsresultingfrombusinessacquisitions foreachofthenextfivefiscalyearsandthereaftertobeasfollows:

NOTE4.DEBT

Short-TermBorrowings

Wehad$112millionand$128millionofoutstandingborrowingsfromU.S.commercialpaperissuancesasof December30,2023andDecember31,2022,respectively,withaweightedaverageinterestrateof5.54%and4.84%, respectively.

WehaveaEuro-CommercialPaperProgramunderwhichwemayissueunsecuredcommercialpapernotesupto amaximumaggregateamountoutstandingof$500million.Proceedsfromissuancesunderthisprogrammaybeusedfor generalcorporatepurposes.Thematuritiesofthenotesvary,butmaynotexceed364daysfromthedateofissuance. Ourpaymentobligationswithrespecttoanynotesissuedunderthisprogramarebackedbyourrevolvingcreditfacility (the“Revolver”).Therearenofinancialcovenantsunderthisprogram.Wehadbalancesof$199.2millionand$213.0 millionoutstandingunderthisprogramasofDecember30,2023andDecember31,2022,respectively,withaweighted averageinterestrateof4.13%and2.06%,respectively.

Short-TermCreditFacilities

InJanuary2023,weextendedthematuritydateoftheRevolverbyoneyeartoFebruary13,2026,andincreased thecommitmentsby$400million,from$800millionto$1.2billion.Additionally,weamendedtheRevolvertoreplacethe LIBORbenchmarkinterestratewithTermSOFR,EuriborandSONIAbenchmarkinterestrates.WeusetheRevolverasa back-upfacilityforourcommercialpaperprogramandforothercorporatepurposes.

NobalancewasoutstandingundertheRevolverasofDecember30,2023orDecember31,2022.Commitment feesassociatedwiththeRevolverin2023,2022and2021were$1.2million,$0.9millionand$0.9million,respectively.

InadditiontotheRevolver,wehaveshort-termlinesofcreditavailableinvariouscountriesofapproximately$327 millionintheaggregateatDecember30,2023.Theselinesmaybecancelledatanytimebyusortheissuingbanks. Short-termborrowingsoutstandingundertheselinesofcreditwere$1.0millionand$2.4millionatDecember30,2023 andDecember31,2022,respectively,withweightedaverageinterestratesof2.24%and0.64%,respectively.

Fromtimetotime,weprovideguaranteesoncertainarrangementswithbanks.Ourexposuretotheseguarantees isnotmaterial.

Long-TermBorrowings

InMarch2023,weissued$400millionofseniornotes,dueMarch15,2033,whichbearaninterestrateof 5.750%peryear,payablesemiannuallyinarrears.Ournetproceedsfromthisissuance,afterdeductingunderwriting discountsandofferingexpenses,were$394.9million,whichweusedtorepaybothexistingindebtednessunderour commercialpaperprogramsandour$250millionaggregateprincipalamountofseniornotesthatmaturedonApril15, 2023.

InAugust2021,weissued$500millionofseniornotes,dueFebruary15,2032,whichbearaninterestrateof 2.250%,payablesemiannuallyinarrears.Ournetproceedsfromthisissuance,afterdeductingunderwritingdiscounts andofferingexpenses,were$493.7million.Additionally,inAugust2021,weissued$300millionofseniornotes,due August15,2024,whichwecanrepaywithoutpenaltyonorafterAugust15,2022andbearaninterestrateof0.850%, payablesemiannuallyinarrears.Ournetproceedsfromthisissuance,afterdeductingunderwritingdiscountsandoffering expenses,were$298million.Weusedthenetproceedsfromthesetwodebtissuancestofinanceaportionofthe Vestcomacquisition.

Ourlong-termdebt,andrelatedinterestrates,atyear-end2023and2022isshownbelow.

Long-termdebt

Medium-termnotes:

Long-termnotes:

Seniornotesdue2033at5.75%395.3—

(1) Theseseniornotesareeuro-denominated.Thefacevalueis €500million.

(2) Includedunamortizeddebtissuancecostsanddebtdiscountsof$11.3millionand$7.4million,respectively,asofyear-end2023and$10.5million and$7.1million,respectively,asofyear-end2022.

Atyear-end2023and2022,ourmedium-termnoteshadaccruedinterestataweightedaveragefixedrateof 7.5%.

Weexpectmaturitiesofourlong-termdebtforeachofthenextfivefiscalyearsandthereaftertobeasfollows:

Other

RefertoNote7,“CommitmentsandLeases,”forinformationrelatedtofinanceleases.

TheRevolvercontainsafinancialcovenantthatrequiresustomaintainaspecifiedratiooftotaldebtinrelationtoa certainmeasureofincome.AsofDecember30,2023andDecember31,2022,wewereincompliancewithourfinancial covenant.

Ourtotalinterestcostsin2023,2022and2021were$126.5million,$89.8millionand$75.0million,respectively, ofwhich$7.5million,$5.7millionand$4.8million,respectively,wascapitalizedaspartofthecostofproperty,plantand equipmentandcapitalizedsoftware.

Theestimatedfairvalueofourlong-termdebtisprimarilybasedonthecreditspreadaboveU.S.Treasury securitiesoreurogovernmentbondsecurities,asapplicable,onnoteswithsimilarrates,creditratingsandremaining maturities.Thefairvalueofshort-termborrowings,whichincludescommercialpaperissuancesandshort-termlinesof credit,approximatestheircarryingvaluegiventheirshortduration.Thefairvalueofourtotaldebtwas$3.11billionat December30,2023and$2.85billionatDecember31,2022.Fairvalueamountsweredeterminedbasedprimarilyon Level2inputs,whichareinputsotherthanquotedpricesinactivemarketsthatareeitherdirectlyorindirectlyobservable. RefertoNote1,“SummaryofSignificantAccountingPolicies,”formoreinformation.

NOTE5.FINANCIALINSTRUMENTS

AsofDecember30,2023,theaggregateU.S.dollarequivalentnotionalvalueofouroutstandingcommodity contractsandforeignexchangecontractswas$5.8millionand$1.34billion,respectively.Ouroutstandingforeign exchangecontractsasofDecember30,2023wererecordedinvariouscurrencies,primarilytheU.S.dollar,euro,Chinese renminbi,BritishpoundsterlingandHongKongdollar.

WerecognizederivativeinstrumentsaseitherassetsorliabilitiesatfairvalueintheConsolidatedBalanceSheets. Wedesignatecommodityforwardcontractsonforecastedpurchasesofcommoditiesandforeignexchangecontractson forecastedtransactionsascashflowhedges.Wealsoenterintoforeignexchangecontractstooffsetcertainofour economicexposuresarisingfromforeignexchangeratefluctuations.

CashFlowHedges

Forderivativeinstrumentsthataredesignatedandqualifyascashflowhedges,theeffectiveportionofthegainor lossonthederivativeisreportedasacomponentof“Accumulatedothercomprehensiveloss”andreclassifiedinto earningsinthesameperiod(s)duringwhichthehedgedtransactionimpactsearnings.Gainsandlossesonthese derivatives,representingeitherhedgeineffectivenessorhedgecomponentsexcludedfromtheassessmentof effectiveness,arerecognizedincurrentearnings.Exceptforthecross-currencyswapdiscussedbelow,cashflowhedges werenotmaterialin2023,2022or2021.

Cross-CurrencySwap

InMarch2020,weenteredintoU.S.dollartoeurocross-currencyswapcontractswithatotalnotionalamountof $250milliontoeffectivelyconvertourfixed-rateU.S.dollar-denominateddebtintoeuro-denominateddebt,including semiannualinterestpaymentsandthepaymentofprincipalatmaturity.Duringthetermofthecontract,whichendson April30,2030,wepayfixed-rateinterestineurosandreceivefixed-rateinterestinU.S.dollars.Thesecontractshave beendesignatedascashflowhedges.Thefairvalueofthesecontractswas$2.3millionasofDecember30,2023and $15.5millionasofDecember31,2022,whichwereincludedin“OtherAssets”intheConsolidatedBalanceSheets.Refer toNote9,“FairValueMeasurements,”totheConsolidatedFinancialStatementsformoreinformation.

Werecordednoineffectivenessfromourcross-currencyswaptoearningsduring2023,2022or2021.

OtherDerivatives

ThefollowingtableshowsthefairvalueandbalancesheetlocationsofotherderivativesasofDecember30,2023 andDecember31,2022:

Forotherderivativeinstrumentsnotdesignatedashedginginstruments,thegainorlossisrecognizedincurrent earnings.

Thefollowingtableshowsthecomponentsofthenetgains(losses)recognizedinincomerelatedtothese derivativeinstruments:

NOTE6.PENSIONANDOTHERPOSTRETIREMENTBENEFITS

DefinedBenefitPlans

Wesponsoranumberofdefinedbenefitplans,theaccrualofbenefitsundersomeofwhichhasbeenfrozen, coveringeligibleemployeesintheU.S.andcertainothercountries.Benefitspayabletoanemployeearebasedprimarily onyearsofserviceandtheemployee’scompensationduringthecourseofhisorheremploymentwithourcompany.

WearealsoobligatedtopayunfundedterminationindemnitybenefitstocertainemployeesoutsidetheU.S., whicharesubjecttoapplicableagreements,lawsandregulations.Wehavenotincurredsignificantcostsrelatedtothese benefits,and,therefore,norelatedcostshavebeenincludedinthedisclosuresbelow.

PlanAssets

Assetsinournon-U.S.plansareinvestedinaccordancewithlocallyacceptedpracticesandprimarilyinclude equitysecurities,fixedincomesecurities,insurancecontractsandcash.Assetallocationsandinvestmentsvarybycountry andplan.Ourtargetplanassetinvestmentallocationforournon-U.S.plansintheaggregateisapproximately26%in equitysecurities,59%infixedincomesecuritiesandcash,and15%ininsurancecontractsandotherinvestments,subject toperiodicfluctuationsamongtheseassetclasses.

FairValueMeasurements

Thevaluationmethodologiesweuseforassetsmeasuredatfairvaluearedescribedbelow.

Cashisvaluedatnominalvalue.Cashequivalentsandmutualfundsarevaluedatfairvalueasdeterminedby quotedmarketprices,baseduponthenetassetvalue(“NAV”)ofsharesheldatyear-end.Pooledfundsarestructuredas collectivetrusts,notpubliclytradedandvaluedbycalculatingNAVperunitbasedontheNAVoftheunderlyingfunds/ trustsasapracticalexpedientforthefairvalueofthepooledfunds.Thepooledfundsarecategorizedbytheprimary investmentstrategywhichisprimarilyinvestmentsinequityandfixedincomesecurities.Thepooledfundscategorizedas otherinvestmentsareprimarilyinvestmentsinrealestatefunds.Insurancecontractsarevaluedatbookvalue,which approximatesfairvalueandiscalculatedusingtheprior-yearbalanceplusorminusinvestmentreturnsandchangesin cashflows.

Thesemethodsmayproduceafairvaluecalculationthatmaynotbeindicativeofnetrealizablevalueorreflective offuturefairvalues.Whilewebelievethesevaluationmethodsareappropriateandconsistentwithothermarket participants,theuseofdifferentmethodologiesorassumptionstodeterminethefairvalueofcertainfinancialinstruments couldresultinadifferentfairvaluemeasurementatthereportingdate.

Thefollowingtablesetsforth,bylevelwithinthefairvaluehierarchy(asapplicable),non-U.S.planassetsatfair value: FairValueMeasurementsUsing

(1) PooledfundsthataremeasuredatfairvalueusingtheNAVperunit(oritsequivalent)practicalexpedienthavenotbeenclassifiedinthefairvalue hierarchy.Thefairvalueamountspresentedinthistableareintendedtoreconciletototalnon-U.S.planassets.

ThefollowingtablepresentsareconciliationofLevel3non-U.S.planassetactivityduringtheyearended December30,2023:

PlanAssumptions

DiscountRate

Inconsultationwithouractuaries,weannuallyreviewanddeterminethediscountratesusedtovalueourpension andotherpostretirementobligations.Theassumeddiscountrateforeachpensionplanreflectsmarketratesforhigh qualitycorporatebondscurrentlyavailable.Ourdiscountrateisdeterminedbyevaluatingyieldcurvesconsistingoflarge populationsofhighqualitycorporatebonds.Theprojectedpensionbenefitpaymentstreamsarethenmatchedwithbond portfoliostodeterminearatethatreflectstheliabilitydurationuniquetoourplans.

Weusethefullyieldcurveapproachtoestimatetheserviceandinterestcostcomponentsofnetperiodicbenefit costforourpensionandotherpostretirementbenefitplans.Underthisapproach,weapplymultiplediscountratesfroma yieldcurvecomposedoftheratesofreturnonseveralhundredhigh-quality,fixedincomecorporatebondsavailableat themeasurementdate.Webelievethatthisapproachprovidesamoreprecisemeasurementofserviceandinterestcost byaligningthetimingofaplan’sliabilitycashflowstoitscorrespondingratesontheyieldcurve.

Long-termReturnonAssets

Wedeterminethelong-termrateofreturnassumptionforplanassetsbyreviewingthehistoricalandexpected returnsofboththeequityandfixedincomemarkets,takingintoaccountourassetallocation,thecorrelationbetween returnsinourassetclasses,andourmixofactiveandpassiveinvestments.Additionally,weevaluatecurrentmarket conditions,includinginterestrates,andreviewmarketdataforreasonablenessandappropriateness.

MeasurementDate

Wemeasuretheactuarialvalueofourbenefitobligationsandplanassetsusingthecalendarmonth-endclosestto ourfiscalyear-endandadjustforanycontributionsorothersignificanteventsbetweenthemeasurementdateandour fiscalyear-end.

PlanBalanceSheetReconciliations

Thefollowingtableprovidesareconciliationofbenefitobligations,planassets,fundedstatusoftheplansand accumulatedothercomprehensivelossforourdefinedbenefitplans:

PlanBenefitObligations

PensionBenefits

20232022

(Inmillions)U.S.Non-U.S.U.S.Non-U.S. Changeinprojectedbenefitobligations

Projectedbenefitobligationsatbeginningofyear$51.8$586.9$66.8$882.4

Servicecost—10.5—16.5

Interestcost2.424.71.210.8

Participantcontributions—4.5—4.6

Amendments—(.1)——

Actuarial(gain)loss1.451.3(9.1)(244.9)

Acquisition—1.2——

Benefitspaid(6.3)(25.3)(7.1)(21.3)

Settlements—(.6)—(1.0)

Foreigncurrencytranslation—26.8—(60.2)

Projectedbenefitobligationsatendofyear$49.3$679.9$51.8$586.9

Accumulatedbenefitobligationsatendofyear$49.3$628.7$51.8$540.2

PlanAssets

PensionBenefits

2023

2022

(Inmillions)

U.S.Non-U.S.U.S.Non-U.S. Changeinplanassets

Planassetsatbeginningofyear

Actualreturnonplanassets —54.6 —(226.5)

Settlements (.6) —(1.0)

Foreigncurrencytranslation —26.4 —(60.3) Planassetsatendofyear $—$663.2$—$585.3

FundedStatus

PensionBenefits

20232022

(Inmillions)U.S.Non-U.S.U.S.Non-U.S. Fundedstatusoftheplans

Otherassets$—$67.8$—$70.0

Otheraccruedliabilities(6.1)(.2)(6.2)(.4)

Long-termretirementbenefitsandotherliabilities(1) (43.2)(84.3)(45.6)(71.2)

Planassetslessthanbenefitobligations$(49.3)$(16.7)$(51.8)$(1.6)

(1) Inaccordancewithourfundingstrategy,wehavetheoptiontofundcertainofourU.S.liabilitieswithproceedsfromourcompany-ownedlife insurancepolicies.

PensionBenefits

2023

2022

U.S.Non-U.S.U.S.Non-U.S.

Weightedaverageassumptionsusedtodetermine year-endbenefitobligations

Discountrate

Compensationrateincrease —2.73 —2.75

ForU.S.andnon-U.S.planscombined,theprojectedbenefitobligationsandfairvaluesofplanassetsforpension planswithprojectedbenefitobligationsinexcessofplanassetswere$210millionand$76million,respectively,atyearend2023and$165millionand$42million,respectively,atyear-end2022.

ForU.S.andnon-U.S.planscombined,theaccumulatedbenefitobligationsandfairvaluesofplanassetsfor pensionplanswithaccumulatedbenefitobligationsinexcessofplanassetswere$162millionand$43million, respectively,atyear-end2023and$132millionand$23million,respectively,atyear-end2022.

AccumulatedOtherComprehensiveLoss

Thefollowingtableshowsthepre-taxamountsrecognizedin“Accumulatedothercomprehensiveloss”inthe ConsolidatedBalanceSheets:

PensionBenefits

2023 2022

(Inmillions)U.S.Non-U.S.U.S.Non-U.S. Netactuarialloss$9.6$73.2$9.1$38.2

Priorservice(credit)cost—(3.4)—(3.5)

Netamountrecognizedinaccumulatedothercomprehensiveloss$9.6$69.8$9.1$34.7

Thefollowingtableshowsthepre-taxamountsrecognizedin“Othercomprehensiveloss(income)”:

PensionBenefits

202320222021

(Inmillions)U.S.Non-U.S.U.S.Non-U.S.U.S.Non-U.S. Netactuarial(gain)loss$.9$32.6$(5.6)$(.8)$(.7)$(34.8)

Priorservicecredit—(.1)———(.9)

Amortizationofunrecognized:

Netactuarialgain(.4)2.1(.8)(2.5)(.8)(6.1)

Priorservicecredit(cost)—.4—.4—.4 Settlements—.1(.1).1(1.1)(.5)

Netamountrecognizedinother comprehensiveloss(income)$.5$35.1$(6.5)$(2.8)$(2.6)$(41.9)

PlanIncomeStatementReconciliations

Thefollowingtableshowsthecomponentsofnetperiodicbenefitcost,whicharerecordedinnetincomeforour definedbenefitplans:

PensionBenefits

2023 2022

Actuarial(gain)loss

Amortizationofpriorservice(credit)cost —(.4)—(.4)—(.4)

Servicecostandcomponentsofnetperiodicbenefitcostotherthanservicecostwereincludedin“Marketing, generalandadministrativeexpense”and“Othernon-operatingexpense(income),net”intheConsolidatedStatementsof Income,respectively.

Thefollowingtableshowstheweightedaverageassumptionsusedtodeterminenetperiodiccost:

PlanContributions

Wemakecontributionstoourdefinedbenefitplanssufficienttomeettheminimumfundingrequirementsof applicablelawsandregulations,plusadditionalamounts,ifany,wedeterminetobeappropriate.Thefollowingtablesets forthourexpectedcontributionsin2024:

Thefuturebenefitpaymentsshownbelowreflecttheexpectedserviceperiodsforeligibleparticipants.

PostretirementHealthBenefits

WeprovidepostretirementhealthbenefitstocertainofourretiredU.S.employeesuptotheageof65undera cost-sharingarrangementandprovidesupplementalMedicarebenefitstocertainofourU.S.retireesovertheageof65. OurpostretirementhealthbenefitplanwasclosedtonewparticipantsretiringafterDecember31,2021.Ourpolicyisto fundthecostofthesepostretirementbenefitsfromoperatingcashflows.Whilewedonotintendtoterminatethese postretirementhealthbenefits,wemaydosoatanytime,subjecttoapplicablelawsandregulations.Atyear-end2023, ourpostretirementhealthbenefitsobligationandrelatedlossrecordedin“Accumulatedothercomprehensiveloss”were approximately$2millionand$10million,respectively.Atyear-end2022,ourpostretirementhealthbenefitsobligation andrelatedlossrecordedin“Accumulatedothercomprehensiveloss”wereapproximately$2millionand$11million, respectively.Netperiodicbenefitcostwasnotmaterialin2023,2022or2021.

DefinedContributionPlans

Wesponsorvariousdefinedcontributionplansworldwide,thelargestofwhichistheAveryDennisonCorporation EmployeeSavingsPlan(“SavingsPlan”),a401(k)planforourU.S.employees.

Werecognizedexpenseof$30.3million,$27.3millionand$24.6millionin2023,2022and2021,respectively, relatedtoouremployercontributionsandemployermatchofparticipantcontributionstotheSavingsPlan.

OtherRetirementPlans

Wehavedeferredcompensationplansandprogramsthatpermiteligibleemployeestodeferaportionoftheir compensation.Thecompensationvoluntarilydeferredbytheparticipant,togetherwithcertainemployercontributions, 68 2023AnnualReport | AveryDennisonCorporation

earnsspecifiedandvariableratesofreturn.Asofyear-end2023and2022,wehadaccrued$88.2millionand$87.3 million,respectively,forourobligationsundertheseplans.Aportionoftheinterestoncertainofourcontributionsmaybe forfeitedbyparticipantsiftheiremploymentterminatesbeforeage55otherthanbyreasonofdeathordisability.

OurDirectorsDeferredEquityCompensationProgramallowsournon-employeedirectorstoelecttoreceivetheir cashcompensationindeferredstockunits(“DSUs”)issuedunderourequityplan.Additionally,twolegacydeferred compensationplanshadDSUsthatwereissuedunderourthen-activeequityplans.Dividendequivalents,representing thevalueofdividendspersharepaidonsharesofourcommonstockandcalculatedwithreferencetothenumberof DSUsheldasofaquarterlydividendrecorddate,arecreditedintheformofadditionalDSUsontheapplicabledividend payabledate.DSUsareconvertedintosharesofourcommonstock,lessfractionalshares,andissuedtothedirectorupon hisorherseparationfromourBoard.Approximately0.1millionDSUswereoutstandingforbothyear-end2023and 2022,withanaggregatevalueof$19millionand$20million,respectively.

Weholdcompany-ownedlifeinsurancepolicies,theproceedsfromwhicharepayabletousuponthedeathof coveredparticipants.Thecashsurrendervaluesofthesepolicies,netofoutstandingloans,whichareincludedin“Other assets”intheConsolidatedBalanceSheets,were$228.4millionand$265.0millionatyear-end2023and2022, respectively.

NOTE7.COMMITMENTSANDLEASES

Supplementalbalancesheetinformationrelatedtoleasesisshownbelow.

Supplementalcashflowinformationrelatedtoleasesisshownbelow.

WeightedaverageremainingleasetermanddiscountrateinformationrelatedtoleasesasofDecember30,2023 andDecember31,2022isshownbelow. 2023

OperatingandfinanceleaseliabilitiesbymaturitydatefromDecember30,2023areshownbelow.

AsofDecember30,2023,wehadnosignificantoperatingorfinanceleasesthathadnotyetcommenced.

NOTE8.CONTINGENCIES

LegalProceedings

Weareinvolvedinvariouslawsuits,claims,inquiriesandotherregulatoryandcompliancematters,mostofwhich areroutinetothenatureofourbusiness.Whenitisprobablethatalosswillbeincurredandwherearangeoftheloss canbereasonablyestimated,thebestestimatewithintherangeisaccrued.Whenthebestestimatewithintherange cannotbedetermined,thelowendoftherangeisaccrued.Theultimateresolutionoftheseclaimscouldaffectfuture resultsofoperationsshouldourexposurebemateriallydifferentfromourestimatesorshouldweincurliabilitiesthat werenotpreviouslyaccrued.Potentialinsurancereimbursementsarenotoffsetagainstpotentialliabilities.

WearecurrentlypartytoalitigationinwhichADASAInc.(“Adasa”),anunrelatedthirdparty,allegedthatcertain ofourRFIDproductswithinourSolutionsGroupreportablesegmentinfringeditspatent.Thecasewasfiledon October24,2017intheUnitedStatesDistrictCourtintheDistrictofOregon(EugeneDivision)andiscaptionedADASA Inc.v.AveryDennisonCorporation.Werecordedacontingentliabilityintheamountof$26.6millionrelatedtothis matterinthesecondquarterof2021basedonajuryverdictissuedonMay14,2021.

Duringthefourthquarterof2021,thefirstinstancejudgmentassociatedwiththejuryverdictwasissued.This resultedinadditionalpotentialliabilityfortheRFIDtagssoldduringtheperiodfromthejuryverdicttotheissuanceofthe firstinstancejudgment,ahigherroyaltyimposedbythejudgeapplicabletotagssoldafterthejudgmentandaroyaltyon additionallate-disclosedtags,aswellassanctions,prejudgmentinterest,costs,andattorneys’fees.Inaddition,Adasa wasawardedanongoingroyaltyonin-scopetagssoldafterOctober14,2021.OnOctober22,2021,weappealedthe judgmenttotheUnitedStatesCourtofAppealsfortheFederalCircuit(“CAFC”).

Duringthefourthquarterof2022,theCAFCissueditsopinion,reversingthegrantofsummaryjudgmentof validityastoanticipationandobviousness,vacatingthesanctionsruling,andremandingthecaseforretrialwithrespect tovalidityforanticipationandobviousnessoverthepriorart.TheCAFCaffirmedsubject-mattereligibilityanddamagesif liabilityisdeterminedonretrial.Onremand,thetrialcourtwasrequiredtoreconsidertheamountofsanctionsconsistent withtheCAFC’sinstructiontolimitsanctionstothelate-disclosedtags.Withcontinuedevaluationofthematterandour defenses,aswellasconsultationwithouroutsidecounsel,webelievedthatAdasa’spatentwasinvalidandthatthe sanctionssoughtbyAdasawereunreasonable.Inaddition,webelievedthattherewereappealablegroundsinthe CAFC’sdecision;asaresult,wesoughtU.S.SupremeCourtreviewonFebruary27,2023.

AftertheU.S.SupremeCourtdeniedourwritofcertioraripetitiononMay30,2023,thetrialcourt’sretrialbegan onJuly10,2023.OnJuly18,2023,thejuryintheretrialissuedaverdictthatAdasa’spatentisvalid.Althoughthecourt hadnotissueditsjudgment,includingitsdecisiononsanctions,weincreasedourcontingentliabilitytoreflectourbest estimateoftheanticipatedjudgmentto$80.4millionasofJuly1,2023,withanexpectationtocontinueadjustingour accrualquarterly,asappropriate.AsofDecember30,2023ourcontingentliabilitywas$82.9million.Wehavegrounds toappealandplantoappealanyjudgmentbasedonthejuryverdict;therefore,weclassifiedthetotalcontingentliability asnon-currentduetothetimeexpectedforthismattertobefullyresolved.

AhearingtookplaceonOctober24,2023beforethedistrictcourtonthependingsanctionsdecisionandcertain post-trialmotions.Wedeterminedthatnoadditionaladjustmenttoouraccrualwasrequiredasaresultofthehearing.

OnJanuary23,2024,thedistrictcourtissuedtwoordersrelatingtoAdasa’soriginalandsupplementalbillof taxablecosts,whichdidnothaveanimpactontheliabilitywerecordedasofDecember30,2023.OnJanuary25,2024, thedistrictcourtissuedarevisedsanctionorderloweringthesanctionagainstusfromapproximately$20millionto approximately$5.2million,basedonaroyaltyof$0.0025/late-reportedtag,whichwasconsistentwiththeamountwe hadaccrued.InFebruary2024,thedistrictcourtissueddecisionsdenyingourmotionforjudgmentasamatteroflawand ourmotionforanewtrial.Weplantoappealtheserecentdecisions.

WehavelargelycompletedourmigrationtoalternativeencodingmethodsforourRFIDtags.

Becauseoftheuncertaintiesassociatedwithclaimsresolutionandlitigation,futureexpensestoresolvelegal proceedingscouldbehigherthantheliabilitieswehaveaccrued;however,weareunabletoreasonablyestimatearange ofpotentialexpenses.Ifinformationweretobecomeavailablethatallowedustoreasonablyestimatearangeofpotential expensesdeterminedtobeprobableinanamounthigherorlowerthanwhatwehaveaccrued,wewouldadjustour accruedliabilitiesaccordingly.Additionallawsuits,claims,inquiries,andotherregulatoryandcompliancematterscould ariseinthefuture.Therangeofexpensesforresolvinganyfuturematterswouldbeassessedastheyarise;untilthen,a rangeofpotentialexpensesfortheirresolutioncannotbedetermined.Baseduponcurrentinformation,webelievethat theimpactoftheresolutionoflegalproceedingswouldnotbe,individuallyorintheaggregate,materialtoourfinancial position,resultsofoperationsorcashflows.

EnvironmentalExpenditures

Environmentalexpendituresaregenerallyexpensed.Whenitisprobablethatalosswillbeincurredandwherea rangeofthelosscanbereasonablyestimated,thebestestimatewithintherangeisaccrued.Whenthebestestimate withintherangecannotbedetermined,thelowendoftherangeisaccrued.Theultimateresolutionofthesematters couldaffectfutureresultsofoperationsshouldourexposurebemateriallydifferentfromourestimatesorshouldweincur liabilitiesthatwerenotpreviouslyaccrued.Potentialinsurancereimbursementsarenotoffsetagainstpotentialliabilities. Wereviewourestimatesofthecostsofcomplyingwithenvironmentallawsrelatedtoremediationandcleanupof varioussites,includingsitesinwhichgovernmentalagencieshavedesignatedusasapotentiallyresponsibleparty (“PRP”).However,environmentalexpendituresfornewlyacquiredassetsandthosethatextendorimprovetheeconomic usefullifeofexistingassetsarecapitalizedandamortizedovertheshorteroftheestimatedusefullifeoftheacquired assetortheremaininglifeoftheexistingasset.

AsofDecember30,2023,wehavebeendesignatedbytheU.S.EnvironmentalProtectionAgency(“EPA”)and/or otherresponsiblestateagenciesasaPRPatelevenwastedisposalorwasterecyclingsitesthatarethesubjectof separateinvestigationsorproceedingsconcerningallegedsoiland/orgroundwatercontamination.Nosettlementofour liabilityrelatedtoanyofthesesiteshasbeenagreedupon.WeareparticipatingwithotherPRPsatthesesitesand anticipatethatourshareofremediationcostswillbedeterminedpursuanttoagreementsthatwenegotiatewiththeEPA orothergovernmentalauthorities.

Theseestimatescouldchangeasaresultofchangesinplannedremedialactions,remediationtechnologies,site conditions,theestimatedtimetocompleteremediation,environmentallawsandregulations,andotherfactors.Because oftheuncertaintiesassociatedwithenvironmentalassessmentandremediationactivities,ourfutureexpensesto remediatethesesitescouldbehigherthantheliabilitieswehaveaccrued;however,weareunabletoreasonablyestimate arangeofpotentialexpensesdeterminedtobeprobable.Ifinformationweretobecomeavailablethatallowedusto reasonablyestimatearangeofpotentialexpensesinanamounthigherorlowerthanwhatwehaveaccrued,wewould adjustourenvironmentalliabilitiesaccordingly.Inaddition,wemaybeidentifiedasaPRPatadditionalsitesinthefuture. Therangeofexpensesforremediationofanyfuture-identifiedsiteswouldbeaddressedastheyarise;untilthen,arange ofexpensesfortheirremediationcannotbedetermined.

Theactivityrelatedtoourenvironmentalliabilitiesin2023and2022isshownbelow:

Approximately$11millionand$9million,respectively,ofthisbalancewasclassifiedasshort-termandincludedin “Othercurrentliabilities”intheConsolidatedBalanceSheetsasofDecember30,2023andDecember31,2022.

NOTE9.FAIRVALUEMEASUREMENTS

RecurringFairValueMeasurements

Assetsandliabilitiescarriedatfairvalue,measuredonarecurringbasis,asofDecember30,2023,wereas follows:

Assetsandliabilitiescarriedatfairvalue,measuredonarecurringbasis,asofDecember31,2022wereas follows:

Derivativeassets4.3—4.3—

Bankdrafts3.23.2——

Cross-currencyswap15.5—15.5—

Liabilities

Derivativeliabilities$12.2$.3$11.9$—

Contingentconsiderationliabilities6.0——6.0

Investmentsincludedfixedincomesecurities(primarilyU.S.governmentandcorporatedebtsecurities)measured atfairvalueusingquotedprices/bidsandamoneymarketfundmeasuredatfairvalueusingNAV.AsofDecember30, 2023,investmentsof$2.7millionand$35.1millionwereincludedin“Cashandcashequivalents”and“Othercurrent assets,”respectively,intheConsolidatedBalanceSheets.AsofDecember31,2022,investmentsof$0.7millionand $30.6millionwereincludedin“Cashandcashequivalents”and“Othercurrentassets,”respectively,intheConsolidated BalanceSheets.Derivativesthatareexchange-tradedaremeasuredatfairvalueusingquotedmarketpricesand classifiedwithinLevel1ofthevaluationhierarchy.Derivativesmeasuredbasedonforeignexchangerateinputsthatare readilyavailableinpublicmarketsareclassifiedwithinLevel2ofthevaluationhierarchy.Bankdrafts(maturitiesgreater thanthreemonths)arevaluedatfacevalueduetotheirshort-termnatureandwereincludedin“Othercurrentassets”in theConsolidatedBalanceSheets.

Contingentconsiderationliabilitiesrelatetoestimatedearn-outpaymentsassociatedwithcertainacquisitions completedin2023,2022and2021,whicharesubjecttotheacquiredcompaniesachievingcertainpost-acquisition performancetargets.Theseliabilitieswererecordedbasedontheexpectedpaymentsandhavebeenclassifiedas Level3.Activityrelatedtocontingentconsiderationin2023and2022wasimmaterial.

Inadditiontotheinvestmentsdescribedabove,weholdventureinvestmentsthathadatotalcarryingvalueof approximately$71millionand$70millionasofDecember30,2023andDecember31,2022,respectively,whichwas includedin“Otherassets”intheConsolidatedBalanceSheets.Werecognizednonetgainsorlossesonthese investmentsin2023andrecognizednetgainsof$13.5millionand$23.0millionin2022and2021,respectively,in “Otherexpense(income),net”intheConsolidatedStatementsofIncome.

NOTE10.NETINCOMEPERCOMMONSHARE

Netincomepercommonsharewascomputedasfollows:

Certainstock-basedcompensationawardswereexcludedfromthecomputationofnetincomepercommonshare, assumingdilution,becausetheywouldnothavehadadilutiveeffect.Stock-basedcompensationawardsexcludedfrom thecomputationtotaled0.1millionsharesfor2023andwerenotsignificantin2022or2021.

NOTE11.SUPPLEMENTALEQUITYANDCOMPREHENSIVEINCOMEINFORMATION

CommonStockandShareRepurchaseProgram

OurAmendedandRestatedCertificateofIncorporationauthorizesfivemillionsharesof$1parvaluepreferred stock(ofwhichnosharesareoutstanding),withrespecttowhichourBoardmayfixtheseriesandtermsofissuance,and 400millionsharesof$1parvaluevotingcommonstock.

Fromtimetotime,ourBoardauthorizestherepurchaseofsharesofouroutstandingcommonstock.Repurchased sharesmaybereissuedunderourlong-termincentiveplanorusedforothercorporatepurposes.In2023,we repurchasedapproximately0.8millionsharesofourcommonstockatanaggregatecostof$137.5million.In2022,we repurchasedapproximately2.2millionsharesofourcommonstockatanaggregatecostof$379.5million.

InApril2022,ourBoardauthorizedtherepurchaseofsharesofourcommonstockwithafairmarketvalueofupto $750million,excludinganyfees,commissionsorotherexpensesrelatedtosuchpurchasesandinadditiontoanyamount outstandingunderourpreviousBoardauthorization.Sharesofourcommonstockintheaggregateamountof$592.8 millionasofDecember30,2023remainedauthorizedforrepurchaseunderthisBoardauthorization.Board authorizationsremainineffectuntilsharesintheamountauthorizedthereunderhavebeenrepurchased.

TreasurySharesReissuance

Wefundaportionofouremployee-relatedcostsusingsharesofourcommonstockheldintreasury.Wereduce capitalinexcessofparvaluebasedonthegrantdatefairvalueofvestingawardsandrecordnetgainsorlosses associatedwithusingtreasurysharestoretainedearnings.

AccumulatedOtherComprehensiveLoss

Thechangesin“Accumulatedothercomprehensiveloss”(netoftax)for2023and2022wereasfollows:

(Inmillions)

HedgesTotal

BalanceasofJanuary1,2022$(217.4)$(60.4)$(5.1)$(282.9)

Othercomprehensiveincome(loss)before reclassifications,netoftax(96.6)6.34.9(85.4)

Reclassificationstonetincome,netoftax—2.81.54.3

Netcurrent-periodothercomprehensiveincome (loss),netoftax(96.6)9.16.4(81.1)

BalanceasofDecember31,2022$(314.0)$(51.3)$1.3$(364.0)

Othercomprehensiveincome(loss)before reclassifications,netoftax(14.6)(25.2)(7.0)(46.8)

Reclassificationstonetincome,netoftax—(1.0)3.72.7

Netcurrent-periodothercomprehensiveincome (loss),netoftax(14.6)(26.2)(3.3)(44.1)

BalanceasofDecember30,2023$(328.6)$(77.5)$(2.0)$(408.1)

Thefollowingtablesetsforththeincometax(benefit)expenseallocatedtoeachcomponentofother comprehensiveincome(loss):

Pensionandotherpostretirementbenefits:

NOTE12.LONG-TERMINCENTIVECOMPENSATION

Stock-BasedAwards

Stock-BasedCompensation

Wegrantourannualstock-basedcompensationawardstoeligibleemployeesinMarchandnon-employee directorsinMay.Certainawardsgrantedtoretirement-eligibleemployeesoneyearormorebeforetheirretirementdate vestuponretirement;theseawardsareaccountedforasfullyvestedoneyearfromthedateofgrant.

Our2017IncentiveAwardPlan(the“EquityPlan”),along-termincentiveplanforemployeesandnon-employee directors,allowsustograntstock-basedcompensationawards–includingstockoptions,RSUs,PUs,MSUsandDSUs–oracombinationoftheseandotherawards.UndertheEquityPlan,5.4millionsharesareavailableforissuance,andeach fullvalueawardiscountedas1.5sharesforpurposesofthenumberofsharesauthorizedforissuance.Fullvalueawards includeRSUs,PUsandMSUs.

Stock-basedcompensationexpenseandtherelatedrecognizedtaxbenefitwereasfollows:

Thisexpensewasincludedin“Marketing,generalandadministrativeexpense”intheConsolidatedStatementsof Income.

AsofDecember30,2023,wehadapproximately$35millionofunrecognizedcompensationexpenserelatedto unvestedstock-basedawards,whichisexpectedtoberecognizedovertheremainingweightedaveragerequisiteservice periodofapproximatelytwoyears.

StockOptions

Stockoptionsmaybegrantedtoemployeesandnon-employeedirectorsatnolessthan100%ofthefairmarket valueofourcommonstockonthedateofthegrantandgenerallyvestoverafour-yearperiod.Optionsexpiretenyears fromthedateofgrant.

ThefairvalueofstockoptionsisestimatedasofthedateofgrantusingtheBlack-Scholesoption-pricingmodel. Thismodelrequiresinputassumptionsforourexpecteddividendyield,expectedstockpricevolatility,risk-freeinterest rateandtheexpectedoptionterm.Thefollowingassumptionsareusedinestimatingthefairvalueofgrantedstock options:

Risk-freeinterestrateisbasedonthe52-weekaverageoftheTreasury-Bondratethathasatermcorresponding totheexpectedoptionterm.For2023,itwas3.84%.

Expectedstockpricevolatilityrepresentsanaverageoftheimpliedandhistoricalvolatility.For2023,itwas 23.90%.

Expecteddividendyieldisbasedonthecurrentannualdividenddividedbythe12-monthaverageofourmonthly stockpricepriortogrant.For2023,itwas1.84%.

Expectedoptiontermisdeterminedbasedonhistoricalexperienceunderourstockoptionandincentiveplans.For 2023,itwas6.31years.

Theweightedaveragegrantdatefairvaluepershareforstockoptionsgrantedin2023was$47.65.Nostock optionsweregrantedinfiscalyears2022or2021.

Thefollowingtablesummarizesinformationrelatedtostockoptions:

Thetotalintrinsicvalueofstockoptionsexercisedwas$3.5millionin2021.Wereceivedapproximately$1million in2021fromtheexerciseofstockoptions,andthetaxbenefitassociatedwiththeseexercisedoptionswas$0.9million. Thestockoptionexercisesin2022wereimmaterialandtherewerenostockoptionexercisesin2023.Theintrinsicvalue ofastockoptionisbasedontheamountbywhichthemarketvalueofourstockexceedstheexercisepriceoftheoption.

PerformanceUnits(“PUs”)

PUsareperformance-basedawardsgrantedtoeligibleemployeesundertheEquityPlan.PUsarepayablein sharesofourcommonstockattheendofathree-orfour-yearcliffvestingperiodprovidedthatthedesignated performanceobjectivesareachievedattheendoftheperiod.Overtheperformanceperiod,theestimatednumberof sharesofourcommonstockissuableuponvestingisadjustedupwardordownwardbasedontheprobabilityofachieving theperformanceobjectivesestablishedfortheaward.Theactualnumberofsharesissuedgenerallyrangesfrom0%to 200%ofthetargetsharesatthetimeofgrant;howeverthesharesissuedforcertainspecialPUawardscanrangeupto 300%ofthetargetsharesattimeofgrant.TheweightedaveragegrantdatefairvalueforPUswas$180.12,$163.97 and$191.86in2023,2022and2021,respectively.

ThefollowingtablesummarizesinformationrelatedtoawardedPUs:

(1) ReflectsadjustmentsforthevestingofPUsbasedonabove-targetperformanceforthe2020-2022performanceperiod.

ThefairvalueofvestedPUswas$22.7millionin2023,$20.2millionin2022and$19.2millionin2021.

76 2023AnnualReport | AveryDennisonCorporation

Market-LeveragedStockUnits(“MSUs”)

MSUsareperformance-basedawardsgrantedtoeligibleemployeesunderourequityplans.MSUsarepayablein sharesofourcommonstockoverafour-yearperiodprovidedthatthedesignatedperformanceobjectiveisachievedasof theendofeachvestingperiod.MSUsaccruedividendequivalentsduringthevestingperiod,whichareearnedandpaid onlyatvestingprovidedthat,ataminimum,threshold-levelperformanceisachieved.Thenumberofsharesearnedis baseduponourabsolutetotalshareholderreturnateachvestingdateandcanrangefrom0%to200%ofthetarget amountofMSUssubjecttovesting.EachofthefourvestingperiodsrepresentsonetrancheofMSUsandthefairvalueof eachofthesefourtrancheswasdeterminedusingtheMonte-Carlosimulationmodel,whichutilizesmultipleinput variables,includingexpectedstockpricevolatilityandotherassumptions,toestimatetheprobabilityofachievingthe performanceobjectiveestablishedfortheaward.TheweightedaveragegrantdatefairvalueforMSUswas$192.53, $141.80and$216.06in2023,2022and2021,respectively.

ThefollowingtablesummarizesinformationrelatedtoawardedMSUs:

(1) ReflectsadjustmentsforthevestingofMSUsbasedonabove-targetperformanceforeachofthetranchesofawardsvestingin2023.

ThefairvalueofvestedMSUswas$16.1millionin2023,$19.9millionin2022and$17.8millionin2021.

RestrictedStockUnits(“RSUs”)

RSUsareservice-basedawardsgrantedtoeligibleemployeesandnon-employeedirectorsunderourequityplans. RSUsgrantedtoemployeesgenerallyvestratablyoveraperiodofthreeorfouryears.RSUsgrantedtonon-employee directorsgenerallyvestinoneyear.ThevestingofRSUsissubjecttocontinuedservicethroughtheapplicablevesting date.Ifthatconditionisnotmet,unvestedRSUsaregenerallyforfeited.Theweightedaveragegrantdatefairvaluefor RSUswas$175.88,$168.34and$196.26in2023,2022and2021,respectively.

ThefollowingtablesummarizesinformationrelatedtoawardedRSUs:

ThefairvalueofvestedRSUswas$2.7million,$2.8millionand$2.7millionin2023,2022and2021,respectively.

Cash-BasedAwards

Long-TermIncentiveUnits(“LTIUnits”)

LTIUnitsarecash-basedawardsgrantedtoemployeesunderourlong-termincentiveunitplan.LTIUnitsare service-basedawardsthatgenerallyvestratablyoverafour-yearperiod.Thesettlementvalueequalsthenumberof

vestedLTIUnitsmultipliedbytheaverageofthehighandlowmarketpricesofourcommonstockonthevestingdate. Thecompensationexpenserelatedtotheseawardsisamortizedonastraight-linebasisandthefairvalueisremeasured usingtheestimatedpercentageofunitsexpectedtobeearnedmultipliedbytheaverageofthehighandlowmarket pricesofourcommonstockateachquarter-end.

Wealsograntcash-basedawardsintheformofperformanceandmarket-leveragedLTIUnitstoeligible employees.PerformanceLTIUnitsarepayableincashattheendofathree-yearcliffvestingperiodprovidedthatcertain performanceobjectivesareachievedattheendoftheperformanceperiod.Market-leveragedLTIUnitsarepayablein cashandvestratablyoveraperiodoffouryears.Thenumberofperformanceandmarket-leveragedLTIUnitsearnedat vestingisadjustedupwardordownwardbasedupontheprobabilityofachievingtheperformanceobjectivesestablished fortherespectiveawardandtheactualnumberofunitsissuedcanrangefrom0%to200%ofthedesignatedtargetunits subjecttovesting.Performanceandmarket-leveragedLTIUnitsareremeasuredusingtheestimatedpercentageofunits expectedtobeearnedmultipliedbytheaverageofthehighandlowmarketpricesofourcommonstockateachquarterendovertheirrespectiveperformanceperiods.ThecompensationexpenserelatedtoperformanceLTIUnitsisamortized onastraight-linebasisovertheirrespectiveperformanceperiods.ThecompensationexpenserelatedtomarketleveragedLTIUnitsisamortizedonagraded-vestingbasisovertheirrespectiveperformanceperiods.

ThecompensationexpenserelatedtoLTIUnitswas$16.3millionin2023,$11.5millionin2022and$21.3million in2021.Thisexpensewasincludedin“Marketing,generalandadministrativeexpense”intheConsolidatedStatements ofIncome.ThetotalrecognizedtaxbenefitrelatedtoLTIUnitswas$3.9millionin2023,$2.7millionin2022and $5.1millionin2021.

NOTE13.COSTREDUCTIONACTIONS

RestructuringCharges

Wehaveplansthatprovideeligibleemployeeswithseverancebenefitsintheeventofaninvoluntarytermination. Wecalculateseveranceusingthebenefitformulasundertheapplicableplans.Werecordrestructuringchargesfrom qualifyingcostreductionactionsforseveranceandotherexitcosts(includingassetimpairmentchargesandleaseand othercontractcancellationcosts)whentheyareprobableandestimable.

2023Actions

Inthethirdquarterof2023,weapprovedarestructuringplan(the“2023Plan”)tofurtheroptimizetheEuropean footprintofourMaterialsGroupreportablesegmentbyreducingoperationsinamanufacturingfacilityinBelgium.The cumulativechargesassociatedwiththe2023Planconsistedofseveranceandrelatedcostsforthereductionof approximately210positionsaswellasassetimpairmentcharges.During2023werecorded$30.4millionin restructuringchargesrelatedtothe2023Plan.Theactivitiesrelatedtothe2023Planareexpectedtobesubstantially completedbymid-2025.

Werecorded$49.0millioninrestructuringcharges,netofreversals,relatedtoother2023actions(collectively withthe2023Plan,“2023Actions”).Thesechargesconsistedofseveranceandrelatedcostsforthereductionof approximately1,450positionsandassetimpairmentchargesatnumerouslocationsacrossourcompany.

2019/2020Actions

During2022,werecorded$7.3millioninrestructuringcharges,netofreversals,relatedtoour2019/2020actions. Thesechargesconsistedofseveranceandrelatedcostsforthereductionofapproximately830positionsandasset impairmentchargesatnumerouslocationsacrossourcompany,reflectingactionsinbothourreportablesegments.The actionsinourMaterialsGroupreportablesegmentwereprimarilyassociatedwithconsolidationsofitsoperationsinNorth AmericaanditsgraphicsbusinessinEurope,inpartinresponsetothepandemic.TheactionsinourSolutionsGroup reportablesegmentwereprimarilyrelatedtoglobalheadcountandfootprintreduction,withsomeactionsaccelerated andexpandedinresponsetothepandemic.Ouractivitiesrelatedtoour2019/2020actionsbeganinthefourthquarterof fiscalyear2019andcontinuedthroughfiscalyear2022.

Accrualsforseveranceandrelatedcostsandleasecancellationcostswereincludedin“Othercurrentliabilities” and“Long-termretirementbenefitsandotherliabilities”intheConsolidatedBalanceSheets.Assetimpairmentcharges werebasedontheestimatedmarketvalueoftheassets,lesssellingcosts,ifapplicable.Restructuringchargeswere includedin“Otherexpense(income),net”intheConsolidatedStatementsofIncome.

78 2023AnnualReport | AveryDennisonCorporation

During2023,restructuringchargesandpaymentswereasfollows:

During2022,restructuringchargesandpaymentswereasfollows:

ThetablebelowshowsthetotalamountofrestructuringchargesincurredbyreportablesegmentandCorporate.

202320222021

NOTE14.TAXESBASEDONINCOME

Taxesbasedonincomewereasfollows:

(Inmillions)

202320222021

Deferred:

TheprincipalitemsaccountingforthedifferencebetweentaxescomputedatU.S.federalstatutoryrateandtaxes recordedwereasfollows:

(1) AllyearsincludedcertainU.S.internationaltaxprovisionsandforeignearningstaxedintheU.S.,netofcredits.

(2) In2023,werecognized$4.4millionfromourcurrentyearGILTIexclusionelectionand$5.6millionrelatedtotheelectionmadeonour2022U.S. federaltaxreturn.In2022,werecognized$11.9millionofbenefitrelatedtoaGILTIexclusionelectionmadeonour2021U.S.federaltaxreturn.In 2021,werecognized$14.1millionand$8.7millionofbenefitrelatedtoGILTIexclusionelectionsmadeonouramended2018andoriginallyfiled2020 U.S.federaltaxreturns,respectively.

IncomebeforetaxesfromourU.S.andforeignoperationswasasfollows:

Oureffectivetaxratewas27.6%,24.2%and25.0%forfiscalyears2023,2022and2021,respectively.

Our2023provisionforincometaxesincluded(i)$16.4millionofnettaxchargerelatedtothetaxonglobal intangiblelow-taxedincome(“GILTI”)ofourforeignsubsidiariesafterbenefitingfromourcurrentyearexclusionelection, aswellastherecognitionofforeignwithholdingtaxesoncurrentyearearnings,partiallyoffsetbythebenefitfrom foreign-derivedintangibleincome(“FDII”);(ii)$14.7millionofreturn-to-provisionbenefitprimarilyrelatedtoourGILTI exclusionelectionandbenefitsfromadditionalforeigntaxcreditsrecognizedundertemporaryreliefgrantedbythe InternalRevenueService(“IRS”)inJuly2023,uponcompletionofour2022U.S.federaltaxreturn,(iii)$10.5millionoftax chargerelatedtonon-deductibleexpensesresultingfromtheimpactoftheArgentinepesoremeasurementloss;and (iv)$9.5millionofnettaxchargeprimarilyfromtherecognitionofuncertaintaxpositionsincertainforeignjurisdictions, partiallyoffsetbydecreasesincertaintaxreservesasaresultofclosingtaxyears.

Our2022provisionforincometaxesincluded(i)$18.8millionofnettaxchargerelatedtothetaxonGILTIofour foreignsubsidiariesandtherecognitionofforeignwithholdingtaxesoncurrentyearearnings,partiallyoffsetbythe benefitfromFDII;(ii)$17.3millionofreturn-to-provisionbenefit,including$11.9millionrelatedtoaGILTIexclusion electionandalowernettaxchargefromotherinternationalinclusionitemsuponcompletionofour2021U.S.federaltax return,and(iii)$4.3millionofnettaxbenefitprimarilyfromdecreasesincertaintaxreserves,includinginterestand penalties,asaresultofclosingtaxyearsandthesettlementofcertainforeigntaxaudits.

Our2021provisionforincometaxesincluded(i)$28.5millionofnettaxchargerelatedtothetaxonGILTIofour foreignsubsidiariesandtherecognitionofforeignwithholdingtaxesoncurrentyearearnings,partiallyoffsetbythe benefitfromFDII;(ii)$14.1millionofreturn-to-provisionbenefitrelatedtoaGILTIexclusionelectionmadeonour amended2018U.S.federaltaxreturn;and(iii)$11.3millionofreturn-to-provisionbenefit,including$8.7millionrelated toaGILTIexclusionelectionandahigherFDIIdeductiononour2020U.S.federaltaxreturn.

DeferredTaxes

Deferredtaxesreflectthetemporarydifferencesbetweentheamountsatwhichassetsandliabilitiesarerecorded forfinancialreportingpurposesandtheamountsutilizedfortaxpurposes.Theprimarycomponentsofthetemporary differencesthatgaverisetoourdeferredtaxassetsandliabilitieswereasfollows:

Weassesstheavailablepositiveandnegativeevidencetoestimateifsufficientfuturetaxableincomeisexpected tobegeneratedtouseexistingdeferredtaxassets.Onthebasisofourassessment,werecordvaluationallowancesonly withrespecttotheportionofthedeferredtaxassetthatisnotmore-likely-than-nottoberealized.Ourassessmentofthe futurerealizabilityofourdeferredtaxassetsreliesheavilyonourforecastedearningsincertainjurisdictionsdetermined bythemannerinwhichweoperateourbusinessandtherelevantcarryforwardperiods.Anychangestoouroperations mayaffectourassessmentofdeferredtaxassetsconsideredrealizableifthepositiveevidencenolongeroutweighsthe negativeevidence.

NetoperatinglosscarryforwardsofforeignsubsidiariesatDecember30,2023andDecember31,2022were $481millionand$463million,respectively.Taxcreditcarryforwardsofbothdomesticandforeignsubsidiariesat December30,2023andDecember31,2022totaled$9millionand$10million,respectively.Ifunused,foreignnet operatinglossesandtaxcreditcarryforwardswillexpireasfollows:

Certainindefinite-livedforeignnetoperatinglossesmayrequiredecadestobefullyutilizedunderourcurrent businessmodel.

AtDecember30,2023,wehadnetoperatinglosscarryforwardsincertainstatesof$429millionbeforetax effects.Basedonourestimatesoffuturestatetaxableincome,itismore-likely-than-notthatthemajorityofthese carryforwardswillnotberealizedbeforetheyexpire.Accordingly,avaluationallowancehasbeenrecordedon $402millionofthesecarryforwards.

AsofDecember30,2023,ourprovisionforincometaxesdidnotmateriallybenefitfromapplicabletaxholidaysin foreignjurisdictions.

UnrecognizedTaxBenefits

AsofDecember30,2023,ourunrecognizedtaxbenefitstotaled$88million,$75millionofwhich,ifrecognized, wouldreduceourannualeffectiveincometaxrate.AsofDecember31,2022,ourunrecognizedtaxbenefitstotaled$70 million,$65millionofwhich,ifrecognized,wouldreduceourannualeffectiveincometaxrate.

Whereapplicable,weaccruepotentialinterestandpenaltiesrelatedtounrecognizedtaxbenefitsinincometax expense.Theinterestandpenaltieswerecognizedduringfiscalyears2023,2022and2021werenotmaterial, individuallyorinaggregate,totheConsolidatedStatementsofIncome.Wehave$16millionofaccruedinterestand penalties,netoftaxbenefit,intheConsolidatedBalanceSheetsatDecember30,2023andDecember31,2022.

Areconciliationofthebeginningandendingamountsofunrecognizedtaxbenefitsissetforthbelow.

(Inmillions)

20232022

Settlementswithtaxauthorities (1.8)(1.1)

Expirationsofstatutesoflimitations (3.9)(4.8)

Changesduetotranslationofforeigncurrencies .8(3.0)

Balanceatendofyear $88.0$69.5

Itisreasonablypossiblethat,duringthenext12months,wemayrealizeadecreaseinouruncertaintaxpositions, includinginterestandpenalties,ofapproximately$6million,primarilyasaresultofclosingtaxyears.

Theamountofincometaxeswepayissubjecttoongoingauditsbytaxingjurisdictionsaroundtheworld.Our estimateofthepotentialoutcomeofanyuncertaintaxissueissubjecttoourassessmentoftherelevantrisks,facts,and circumstancesexistingatthetime.Webelievewehaveadequatelyprovidedforreasonablyforeseeableoutcomesrelated tothesematters.However,ourfutureresultsmayincludefavorableorunfavorableadjustmentstoourestimatedtax liabilitiesintheperiodtheassessmentsaremadeorresolved,whichmayimpactoureffectivetaxrate.Thefinal determinationoftaxauditsandanyrelatedlegalproceedingscouldmateriallydifferfromamountsreflectedinourtax provisionforincometaxesandtherelatedliabilities.Todate,weandourU.S.subsidiarieshavecompletedtheIRS’ ComplianceAssuranceProcessthrough2021.Withlimitedexceptions,wearenolongersubjecttoincometax examinationsbytaxauthoritiesforyearspriorto2010.

NOTE15.SEGMENTANDDISAGGREGATEDREVENUEINFORMATION

SegmentReporting

Wehavethefollowingreportablesegments:

•MaterialsGroup–manufacturesandsellspressure-sensitivelabelmaterials,filmsforgraphicandreflective products,performancetapesandotheradhesiveproductsforindustrial,medicalandotherapplications,as wellasfastenersolutions.

•SolutionsGroup–designs,manufacturesandsellsawidevarietyofbrandingandinformationsolutions, includingbrandandpricetickets,tagsandlabels(includingRFIDinlays),andrelatedservices,suppliesand equipment.

Intersegmentsalesarerecordedatornearmarketpricesandareeliminatedindeterminingconsolidatedsales.We evaluateourperformancebasedonincomefromoperationsbeforeinterestexpenseandtaxes.Corporateexpenseis excludedfromthecomputationofincomefromoperationsforthesegments.

Wedonotdisclosetotalassetsbyreportablesegmentsinceweneithergeneratenorreviewthatinformation internally.Asourreportingstructureisneitherorganizednorreviewedinternallybycountry,resultsbyindividualcountry arenotprovided.

DisaggregatedRevenueInformation

Disaggregatedrevenueinformationisshownbelowinthemannerthatbestreflectshowthenature,amount, timinganduncertaintyofourrevenueandcashflowsareaffectedbyeconomicfactors.RevenuefromourMaterials Groupreportablesegmentisattributedtogeographicareasbasedonthelocationfromwhichproductsareshipped. RevenuefromourSolutionsGroupreportablesegmentisshownbyproductgroup.

RevenuefromourMaterialsGroupreportablesegmentbyproductgroupisshownbelow.

Ourtotalcompanyrevenuebygeographicareaisshownbelow.Revenueisattributedtogeographicareasbased onthelocationfromwhichproductsareshipped.

NetsalestounaffiliatedcustomersinAsiaincludedsalesinChina(includingHongKong)of$1.30billionin2023, $1.50billionin2022and$1.68billionin2021.

Nosinglecustomerrepresented10%ormoreofournetsalesinyear-end2023,2022or2021.Ourtenlargest customersbynetsalesintheaggregaterepresentedapproximately16%ofournetsalesduring2023,2022and2021.

AdditionalSegmentInformation

AdditionalfinancialinformationbyreportablesegmentandCorporateisshownbelow.

(1)

(2)

Otherexpense(income),netbytypewereasfollows:

(1) Amountfor2023includedanadditionalcontingentliabilityrelatedtotheAdasalitigationintheamountof$56.3million.RefertoNote8, “Contingencies”formoreinformationregardingtheAdasalitigation.

Amountfor2021includedanindirecttaxcreditbasedonaBrazilianFederalSupremeCourtrulingintheamountof$29.1million,partiallyoffsetbya contingentliabilityrelatedtotheAdasalitigationintheamountof$26.6million.RefertoNote8,“Contingencies”formoreinformationregardingthe Adasalitigation.

(2) TheimpactoftheArgentinepesoremeasurementlosspriortothethirdquarterof2023wasnotmaterial.

Property,plantandequipment,net,inourU.S.andnon-U.S.operationswereasfollows:

Property,plantandequipment,net,locatedinChina(includingHongKong)wasapproximately$247millionin 2023,$259millionin2022and$290millionin2021.

NOTE16.SUPPLEMENTALFINANCIALINFORMATION

Inventories

Inventoriesatyear-endwereasfollows:

Property,PlantandEquipment,Net

Majorclassesofproperty,plantandequipment,statedatcost,atyear-endwereasfollows:

(Inmillions)

20232022

Buildingsandimprovements817.9781.0

Machineryandequipment2,799.52,667.8

Construction-in-progress317.1269.6

Property,plantandequipment3,970.43,747.7

Accumulateddepreciation(2,344.6)(2,207.5) Property,plantandequipment,net$1,625.8$1,540.2

Software

Capitalizedsoftwarecostsatyear-endwereasfollows:

(Inmillions)

20232022

Accumulatedamortization(257.9)(282.3)

Softwareamortizationexpensewas$23.4millionin2023,$29.5millionin2022and$30.1millionin2021.

AllowanceforCreditLosses

Giventheshort-termnatureoftradereceivables,ourallowanceforcreditlossesisbasedonthefinancialcondition ofcustomers,theagingofreceivablebalances,ourhistoricalcollectionsexperience,andcurrentandexpectedfuture macroeconomicandmarketconditions.Balancesarewrittenoffintheperiodinwhichtheyaredeterminedtobe uncollectible.

Theactivityrelatedtoourallowanceforcreditlosseswasasfollows:

(Inmillions)

20232022

Balanceatbeginningofyear$34.4$33.0

Amountswrittenoff (6.3)(4.3)

Other,includingforeigncurrencytranslation1.9(1.2)

Balanceatendofyear$34.4$34.4

Thereversalofcreditlosseswas$4.7millionin2021.

ResearchandDevelopment

Researchanddevelopmentexpense,whichwasincludedin“Marketing,generalandadministrativeexpense”in theConsolidatedStatementsofIncome,wasasfollows:

2023

SupplementalCashFlowInformation

Cashpaidforinterestandincometaxeswasasfollows:

ForeignCurrencyEffects

Gainsandlossesresultingfromforeigncurrencytransactionsareincludedinincomeintheperiodincurred. Transactionsinforeigncurrencies(includingreceivables,payablesandloansdenominatedincurrenciesotherthanthe functionalcurrency),includinghedgingimpacts,werenotmaterialin2023,2022or2021.

DeferredRevenue

Deferredrevenueprimarilyrelatestoconstrainedvariableconsiderationonsupplyagreementsforsalesof products,aswellastopaymentsreceivedinadvanceofperformanceunderacontract.Deferredrevenueisrecognizedas revenueasorwhenweperformunderacontract.

ThefollowingtableshowstheamountsandbalancesheetlocationsofdeferredrevenueasofDecember30,2023 andDecember31,2022:

RevenuerecognizedfromamountsincludedindeferredrevenueasofDecember31,2022was$21.0millionin 2023.RevenuerecognizedfromamountsincludedindeferredrevenueasofJanuary1,2022was$23.5millionin2022. RevenuerecognizedfromamountsincludedindeferredrevenueasofJanuary2,2021was$18.4millionin2021.This revenuewasincludedin“Netsales”intheConsolidatedStatementsofIncome.

SupplierFinancePrograms

Wehaveagreementswiththird-partyfinancialinstitutionstofacilitatepaymentstosuppliers.Thesethird-party financialinstitutionsoffervoluntarysupplychainfinanceprogramsthatenablecertainofoursuppliers,atthesupplier’s solediscretion,tosellourpaymentobligationstoafinancialinstitutionontermsdirectlynegotiatedwiththefinancial institution.Participatingsuppliersdecidewhichpaymentobligationsaresoldtothefinancialinstitutionandwehaveno economicinterestinasupplier’sdecisiontosellthesepaymentobligations.Wemakepaymentstothefinancialinstitution ontheinvoiceduedate,regardlessofwhetheranindividualinvoiceissoldbythesuppliertothefinancialinstitution.Our obligationstooursuppliers,includingamountsdueandscheduledpaymentdates,arenotimpactedbysuppliers’ decisionstosellamountsunderthesearrangements.Amountsdueunderoursupplychainfinanceprogramsareincluded inaccountspayableonourConsolidatedBalanceSheetsandactivitiesrelatedtotheseprogramsarepresentedas operatingactivitiesinourConsolidatedStatementsofCashFlows.AsofDecember30,2023andDecember31,2022, theamountsduetofinancialinstitutionsforsuppliersthatparticipateintheseprogramswere$397.4millionand$430.1 million,respectively.

Item9.CHANGESINANDDISAGREEMENTSWITHACCOUNTANTSONACCOUNTINGANDFINANCIAL DISCLOSURE

None.

Item9A.CONTROLSANDPROCEDURES

DisclosureControlsandProcedures.Asoftheendoftheperiodcoveredbythisreport,wecarriedoutan evaluation,underthesupervisionandwiththeparticipationofourmanagement,includingourChiefExecutiveOfficerand ourChiefFinancialOfficer,oftheeffectivenessofthedesignandoperationofourdisclosurecontrolsandprocedures(as definedinRule13a-15(e)and15d-15(e)oftheExchangeAct).Baseduponthatevaluation,ourChiefExecutiveOfficer andChiefFinancialOfficerconcludedthatourdisclosurecontrolsandprocedureswereeffectiveinprovidingreasonable assurancethatinformationisrecorded,processed,summarizedandreportedwithinthetimeperiodsspecifiedinthe SEC’srulesandforms,andthatsuchinformationisaccumulatedandcommunicatedtoourmanagement,includingour ChiefExecutiveOfficerandourChiefFinancialOfficerasappropriate,toallowfortimelydecisionsregardingrequired disclosure.

Management’sReportonInternalControlOverFinancialReporting. Weareresponsibleforestablishingand maintainingadequateinternalcontroloverfinancialreporting(asdefinedinRule13a-15(f)and15d-15(f)ofthe ExchangeAct).Underthesupervisionandwiththeparticipationofourmanagement,includingourChiefExecutiveOfficer andourChiefFinancialOfficer,weconductedanevaluationoftheeffectivenessofourinternalcontroloverfinancial reportingbasedupontheframeworkin InternalControl–IntegratedFramework(2013) issuedbytheCommitteeof SponsoringOrganizationsoftheTreadwayCommission.Basedonthatevaluation,ourmanagementconcludedthatour internalcontroloverfinancialreportingwaseffectiveasofDecember30,2023.

TheeffectivenessofourinternalcontroloverfinancialreportingasofDecember30,2023hasbeenauditedby PricewaterhouseCoopersLLP,anindependentregisteredpublicaccountingfirm,asstatedintheReportofIndependent RegisteredPublicAccountingFirmcontainedinItem8ofthisreport.

ChangesinInternalControloverFinancialReporting. Therehavebeennochangesinourinternalcontrolover financialreportingduringthemostrecentfiscalquarterthathavemateriallyaffected,orarereasonablylikelytomaterially affect,ourinternalcontroloverfinancialreporting.

Item9B.OTHERINFORMATION

NoneofourdirectorsorexecutiveofficersadoptedorterminatedaRule10b5-1tradingarrangementoranonRule10b5-1tradingarrangement(asdefinedinItem408(c)ofRegulationS-K)duringthefourthquarterof2023.

Item9C.DISCLOSUREREGARDINGFOREIGNJURISDICTIONSTHATPREVENTINSPECTIONS

Notapplicable.

PARTIII

Item10.DIRECTORS,EXECUTIVEOFFICERSANDCORPORATEGOVERNANCE

TheinformationconcerningdirectorsandcorporategovernancerequiredbythisItemisincorporatedhereinby referencefromthedefinitiveproxystatementforourAnnualMeetingofStockholderstobeheldonApril25,2024(our “2024ProxyStatement”),whichwillbefiledwiththeSECpursuanttoRegulation14Awithin120daysoftheendofthe fiscalyearcoveredbythisreport.TheinformationconcerningexecutiveofficersrequiredbythisItemappears,inpart,as referencedbelow.Ifapplicable,informationconcerninganylatefilingsunderSection16(a)oftheExchangeActis incorporatedbyreferencefromour2024ProxyStatement.

TheinformationrequiredbythisItemconcerningourAuditCommitteeisincorporatedbyreferencefromour2024 ProxyStatement.

INFORMATIONABOUTOUREXECUTIVEOFFICERS(1)

NameandPosition AgeExecutiveOfficerSince FormerPositionswithinPastFiveYears/ OfficerPositionswithAveryDennison

DeonM.Stander Presidentand ChiefExecutiveOfficer

MitchellR.Butier ExecutiveChairman

GregoryS.Lovins SeniorVicePresidentand ChiefFinancialOfficer

DeenaBaker-Nel

NicholasR.Colisto

FranciscoMelo President,SolutionsGroup

55August20162022-2023PresidentandChiefOperatingOfficer

2015-2022VicePresidentandGeneralManager,RBIS

2013-2015VicePresidentandGeneralManager, GlobalCommercialandInnovation,RBIS

2010-2012VicePresidentandGeneralManager, GlobalCommercial,RBIS

52March20072022-2023ChairmanandChiefExecutiveOfficer

2019-2022Chairman,PresidentandChiefExecutive Officer

2016-2019PresidentandChiefExecutiveOfficer

2015-2016PresidentandChiefOperatingOfficer

2014-2015President,ChiefOperatingOfficerand ChiefFinancialOfficer

2010-2014SeniorVicePresidentandChiefFinancial Officer

2007-2010VicePresident,GlobalFinanceandChief AccountingOfficer

51March20172017VicePresidentandInterimChiefFinancial Officer

2016-2017VicePresidentandTreasurer

2011-2016VicePresident,GlobalFinance,Materials Group

53September20202020-2022VicePresidentandChiefHuman ResourcesOfficer

2018-2020VicePresident,HumanResources,LGM 2015-2018VicePresident,HumanResources,RBIS

57September20202018-2022VicePresidentandChiefInformation Officer

2012-2018SeniorVicePresidentandChief InformationOfficer,XylemInc.

50April20232022-2023SeniorVicePresidentandGeneral Manager,AveryDennisonSmartrac

2013-2022VicePresidentandGeneralManager, AveryDennisonSmartrac

2012-2013VicePresidentGlobalInventoryAccuracy andLossPrevention,Information SolutionsMarketDevelopment

AveryDennisonCorporation

NameandPosition AgeExecutiveOfficerSince

DivinaF.Santiago VicePresident,Controller

IgnacioJ.Walker SeniorVicePresidentand ChiefLegalOfficer

FormerPositionswithinPastFiveYears/ OfficerPositionswithAveryDennison

54September20232022-2023VicePresidentFinance

2008-2022SeniorDirector,Finance

47September20202020-2022VicePresidentandChiefLegalOfficer 2020VicePresidentandAssistantGeneral Counsel,Americas

2018-2019VicePresidentandAssistantGeneral Counsel

2013-2017VicePresidentandAssistantGeneral Counsel,RBIS

(1) Executiveofficersaregenerallyelectedonthedateofourannualstockholdermeetingtoserveaone-yeartermanduntiltheirsuccessorsareduly electedandqualified.

Item11.EXECUTIVECOMPENSATION

TheinformationrequiredbythisItemisincorporatedbyreferencefromour2024ProxyStatement.

Item12.SECURITYOWNERSHIPOFCERTAINBENEFICIALOWNERSANDMANAGEMENTANDRELATED STOCKHOLDERMATTERS

TheinformationrequiredbythisItemisincorporatedbyreferencefromour2024ProxyStatement.

Item13.CERTAINRELATIONSHIPSANDRELATEDTRANSACTIONS,ANDDIRECTORINDEPENDENCE

TheinformationrequiredbythisItemisincorporatedbyreferencefromour2024ProxyStatement.

Item14.PRINCIPALACCOUNTANTFEESANDSERVICES

TheinformationrequiredbythisItemisincorporatedbyreferencefromour2024ProxyStatement.

Item15.EXHIBITANDFINANCIALSTATEMENTSCHEDULES

(a)FinancialStatements,FinancialStatementScheduleandExhibits

(1)FinancialstatementsfiledaspartofthisreportarelistedontheaccompanyingIndextoFinancial Statements.

(2)Allfinancialstatementschedulesareomittedsincetherequiredinformationisnotpresentorisnot presentinamountssufficienttorequiresubmissionoftheschedule,orbecausetheinformation requiredisincludedintheconsolidatedfinancialstatementsandnotesthereto.

(3)ExhibitsfiledasapartofthisreportarelistedontheaccompanyingExhibitIndex.Eachmanagement contractorcompensatoryplanorarrangementrequiredtobefiledasanexhibittothisForm10-Kis identifiedassuchontheExhibitIndex.

(b)TheexhibitsrequiredtobefiledbyItem601ofRegulationS-KaresetforthontheaccompanyingExhibit Index.

AVERYDENNISONCORPORATION

EXHIBITINDEX

FortheYearEndedDecember30,2023

ExhibitNo. ExhibitName

2.1AgreementandPlanofMerger,datedasof July27,2021,byandamongRegistrant,CB VelocityHoldings,LLC,LoboMergerSub, LLCandCharlesbankEquityFundVIII, LimitedPartnership,asunitholder representative

3.1(i)AmendedandRestatedCertificateof Incorporation,asfiledonApril28,2011 withtheOfficeofDelawareSecretaryof State

3.1(ii)AmendedandRestatedBylaws,effectiveas ofFebruary23,2023

4.1Indenture,datedasofMarch15,1991, betweenRegistrantandSecurityPacific NationalBank,asTrustee(the“1991 Indenture”)

4.2FirstSupplementalIndenture,datedasof March16,1993,betweenRegistrantand BankAmericaNationalTrustCompany,as successorTrustee(the“Supplemental Indenture”)

4.3Officers’Certificateestablishingaseriesof Securitiesentitled“Medium-TermNotes, SeriesC”underthe1991Indenture,as amendedbytheSupplementalIndenture

Originally Filedas ExhibitNo. Filing(1)

2.1CurrentReportonForm8-K,filedJuly30, 2021

3.1CurrentReportonForm8-K,filedApril29, 2011

3.1CurrentReportonForm8-K,filed February27,2023

4.1RegistrationStatementonFormS-3(File No.33-39491),filedMarch19,1991

4.4RegistrationStatementonFormS-3(File No.33-59642),filedMarch17,1993

4.1CurrentReportonForm8-K,filedMay12, 1995

ExhibitNo. ExhibitName

4.4Indenture,datedasofJuly3,2001, betweenRegistrantandChaseManhattan BankandTrustCompany,National Association,astrustee(the“2001 Indenture”)

4.5Officers’CertificateestablishingSecurities entitled“6.000%Notesdue2033”under the2001Indenture

Originally Filedas

ExhibitNo. Filing(1)

4.1RegistrationStatementonFormS-3(File No.333-64558),filedJuly3,2001

4.2CurrentReportonForm8-K,filed January16,2003

4.66.000%NotesDue20334.4CurrentReportonForm8-K,filed January16,2003

4.7Indenture,datedasofNovember20, 2007,betweenRegistrantandBankofNew York

4.8ThirdSupplementalIndenture,datedasof April8,2013,betweenRegistrantandBank ofNY

4.2CurrentReportonForm8-K,filed November20,2007

4.2CurrentReportonForm8-K,filedApril8, 2013

4.9Formof3.35%SeniorNotesdue20234.2CurrentReportonForm8-K,filedApril8, 2013

4.10FourthSupplementalIndenture,datedasof March3,2017,betweenRegistrantand TheBankofNewYorkMellonTrust Company,N.A.(“BNYMellon”)asTrustee (includingFormof1.250%SeniorNotes due2025onExhibitAthereto)

4.11FifthSupplementalIndenture,datedasof December6,2018,betweenRegistrantand BNYMellon,asTrustee(includingFormof 4.875%SeniorNotesdue2028onExhibit Athereto)

4.12SixthSupplementalIndenture,datedasof March11,2020,betweenRegistrantand BNYMellon,asTrustee(includingFormof 2.650%SeniorNotesdue2030on ExhibitAthereto)

4.13SeventhSupplementalIndenture,datedas ofAugust18,2021,betweenRegistrant andBNYMellon,asTrustee(includingForm of0.850%SeniorNotesdue2024on ExhibitAthereto)

4.14EighthSupplementalIndenture,datedasof August18,2021,betweenRegistrantand BNYMellon,asTrustee(includingFormof 2.250%SeniorNotesdue2032on ExhibitAthereto)

4.2CurrentReportonForm8-K,filedMarch3, 2017

4.2CurrentReportonForm8-K,filed December6,2018

4.2CurrentReportonForm8-K,filedMarch11, 2020

4.2CurrentReportonForm8-Kfiledon August18,2021

4.3CurrentReportonForm8-Kfiledon August18,2021

ExhibitNo. ExhibitName

4.15NinthSupplementalIndenture,datedasof March15,2023,betweenRegistrantand TheBankofNewYorkMellonTrust Company,N.A.,asTrustee(includingForm of5.750%SeniorNotesdue2033on ExhibitAthereto).

4.16DescriptionofSecurities

10.1AmendmentNo.2toCreditAgreement, datedasofJanuary24,2023,byand amongAveryDennisonCorporation,a Delawarecorporation,astheborrower, BankofAmerica,N.A.,astheadministrative agent,andtheotherlenderspartythereto.

10.2*AmendedandRestatedSupplemental ExecutiveRetirementPlan(“SERP”)

10.3*CompleteRestatementandAmendmentof

10.4*AmendmentNo.1toEVDCP

Originally Filedas

ExhibitNo. Filing(1)

4.2CurrentReportonForm8-Kfiledon March15,2023

4.152020AnnualReportonForm10-K,filed February25,2021

10.1CurrentReportonForm8-K,filed January30,2023

10.11.1QuarterlyReportonForm10-Q,filed August12,2009

10.161994AnnualReportonForm10-K,filed March30,1995

10.16.11999AnnualReportonForm10-K,filed

10.32*OfferLettertoDeonStander,dated

10.33*OfferLettertoDeonStander,datedMay25,

10.34*OfferLettertoHassanRmaile,dated

ExhibitNo. ExhibitName

Originally Filedas

ExhibitNo. Filing(1)

101.PRE†††InlineXBRLExtensionPresentation LinkbaseFiling N/AN/A

104†††InlineXBRLforthecoverpageofthis AnnualReportonForm10-K,includedas partoftheExhibit101inlineXBRL documentset

(1) Unlessotherwisenoted,theFileNumberforallfilingsisFileNo.1-7685.

*ManagementcontractorcompensatoryplanorarrangementrequiredtobefiledasanexhibittothisForm10-K pursuanttoItem15(b)ofForm10-K.

†Filedherewith.

††Thiscertificationisbeingfurnishedsolelytoaccompanythisreportpursuantto18U.S.C.1350,andisnotbeing filedforpurposesofSection18oftheExchangeActandisnottobeincorporatedbyreferenceintoanyfilingof theregistrant,whethermadebeforeorafterthedatehereof,regardlessofanygeneralincorporationlanguagein suchfiling.

†††Furnishedherewith.PursuanttoRule406TofRegulationS-T,theInteractiveDataFilesonExhibit101heretoare deemednotfiledorpartofaregistrationstatementorprospectusforpurposesofSections11or12ofthe SecuritiesAct,aredeemednotfiledforpurposesofSection18oftheExchangeActandotherwisearenotsubject toliabilityunderthosesections.

Item16.FORM10-KSUMMARY

Notapplicable.

SIGNATURES

PursuanttotherequirementsofSection13or15(d)oftheSecuritiesExchangeActof1934,theregistranthas dulycausedthisreporttobesignedonitsbehalfbytheundersigned,thereuntodulyauthorized.

AVERYDENNISONCORPORATION

By:/s/GregoryS.Lovins

GregoryS.Lovins

SeniorVicePresidentandChiefFinancialOfficer

Dated:February21,2024

POWEROFATTORNEY

EachpersonwhosesignatureappearsbelowdoesherebyconstituteandappointGregoryS.LovinsandIgnacioJ. Walker,andeachofthem,withfullpowerofsubstitution,hisorhertrueandlawfulattorney-in-facttoactforhimorher inanyandallcapacities,tosignthisAnnualReportonForm10-Kandanyorallamendmentsorsupplementsthereto, andtofileeachofthesame,withallexhibitsthereto,andotherdocumentsinconnectiontherewith,withtheSecurities andExchangeCommission,grantinguntosaidattorneys-in-fact,andeachofthem,fullpowerandauthoritytodoand performeachandeveryactandthingrequisiteandnecessarytobedoneinordertoeffectuatethesameasfully,toall intentsandpurposes,asheorshecoulddoinperson,herebyratifyingandconfirmingallthatsaidattorneys-in-factor substitutes,oranyofthem,maylawfullydoorcausetobedonebyvirtuehereof.

PursuanttotherequirementsoftheSecuritiesExchangeActof1934,thisreporthasbeensignedbelowbythe followingpersonsonbehalfoftheRegistrantandinthecapacitiesandasofthedatesindicated.

[THIS PAGE INTENTIONALLY LEFT BLANK]

NOTICEOFANNUAL MEETINGOFSTOCKHOLDERS

RECORDDATE February26,2024

MEETINGDATE April25,2024

MEETINGTIME 2:30p.m.EasternTime

MEETINGFORMAT Virtualatwww.virtualshareholdermeeting.com/AVY2024

ITEMSOFBUSINESSFORSTOCKHOLDERVOTE

1 Electionofthe10directorsnominatedbyourBoardtoserveforaone-yearterm

2 Approval,onanadvisorybasis,ofourexecutivecompensation

3 ApprovalofaCertificateofAmendmenttoourAmendedandRestatedCertificateofIncorporationtoprovidethat stockholdersholding25%ofouroutstandingcommonstockhavetherighttorequestthatwecallspecialmeetingsof stockholders

4 RatificationoftheappointmentofPwCasourindependentregisteredpublicaccountingfirmforfiscalyear2024

OurBoardrecommendsthatyouvoteFOReachofour10directornomineesinItem1andFORItems2,3and4.

StockholdersofrecordasofFebruary26,2024areentitledtonoticeof,andtovoteinconnectionwith,themeetingand anyadjournmentorpostponementthereof.Thisnoticeandourdefinitiveproxystatementarebeingfirstmailedormade availabletostockholdersonoraboutMarch11,2024.

Wewantyoursharestoberepresentedandvoted. Weencourageyoutovotepromptlyasthiswillsaveusthetimeand expenseofadditionalproxysolicitation.Asshownbelow,youcanvoteonline,bytelephone,bymailor,incertain circumstances,duringthemeeting.

OnbehalfofourBoardofDirectors,managementandteammembersworldwide,thankyouforinvestinginusandour company.WelookforwardtoengagingwithyouduringthevirtualAnnualMeeting.

VikasArora VicePresident,AssociateGeneralCounseland CorporateSecretary

March11,2024

ONLINE BYTELEPHONE BYMAIL DURINGMEETING

Youcanvoteonlineusingthe 16-digitcontrolnumbershown onyourNoticeofInternet Availability,proxycardorvoting instructionform.

IntheU.S.andCanada,you canvotebytelephoneusing the16-digitcontrolnumber shownonyourNoticeof InternetAvailability,proxy cardorvotinginstructionform.

Youcanvotebymailby completing,datingandsigning yourproxycardorvoting instructionformandreturning itintheaccompanying postage-paidenvelope.

Registeredholderscanvote duringthemeeting.Beneficial holdersmustcontacttheirbroker orothernomineetobeableto voteduringthemeeting.Shares heldthroughourEmployee SavingsPlanmaynotbevoted duringthemeeting.

VOTING

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PROXYSUMMARY

Thisproxysummaryincludeskeymessagesrelatedtothisproxystatementanddoesnotcontainalltheinformation youshouldconsiderbeforevoting. Westronglyencourageyoutoreadtheentireproxystatementbeforevoting.

INFORMATIONREGARDINGANNUALMEETING

DistributionofProxyMaterials

WewillbeginmailingourNoticeofInternetAvailabilityofProxyMaterials,whichincludesinstructionsonhowto accessthesematerialsonlineandvoteyourshares,onoraboutMarch11,2024.Ifyoupreviouslyelectedtoreceivea papercopyofourproxymaterials,onoraboutthesamedate,wewillmailyouaproxycardandour2023integrated financialandsustainabilityreport(our“2023IntegratedReport”),whichincludesalettertostockholdersfromour President/ChiefExecutiveOfficer(CEO);adescriptionofourbusinesses,stakeholdersandvalues;highlightsofour strategies,financialperformanceandsustainabilityprogress;ourAnnualReportonForm10-Kforthefiscalyearended December30,2023(our“2023AnnualReport”);andthenoticeandproxystatementforour2024AnnualMeetingof Stockholders(the“AnnualMeeting”).

Time,DateandFormatofAnnualMeeting

TheAnnualMeetingwilltakeplaceat2:30p.m.EasternTimeonApril25,2024.Toallowstockholderstoattend withoutthetimeandexpenseofdoingsoinperson,themeetingwillbeheldvirtually,withattendanceviathe internet. ToattendthevirtualAnnualMeeting,youwillneedtologintowww.virtualshareholdermeeting.com/AVY2024 usingthe16-digitcontrolnumberonyourNoticeofInternetAvailabilityofProxyMaterials,proxycardorvoting instructionform.

OnlineaccesstotheliveaudiowebcastoftheAnnualMeetingwillopenat2:15p.m.EasternTimetoallowtimefor youtologinandtestyourdevice’saudiosystem.Weencourageyoutoaccessthemeetinginadvanceofitsstarttimeas weplantobeginthemeetingpromptly.ForadditionalinstructionsonhowtoattendthevirtualAnnualMeeting,please refertothe VotingandMeetingQ&A sectionofthisproxystatement.

ItemsBeingVotedonDuringAnnualMeeting

YouarebeingaskedtovoteontheitemsofbusinessshownbelowduringtheAnnualMeeting. OurBoardof Directors(our“Board”)recommendsthatyouvoteforeachofour10directornomineesandforItems2,3and4.

3

havetherighttorequestthatwecallspecialmeetingsof stockholders

4

VotingPriortoorDuringAnnualMeeting

YoumayvoteyoursharesbysubmittingaproxyinadvanceoftheAnnualMeetingonline,bytelephoneorbymail; onlyincertaincircumstancesmayyouvoteduringthemeeting.Ifyouarearegisteredstockholderwhohasnotpreviously votedorwantstochangeyourvote,youmayvoteduringtheAnnualMeeting.Beneficialholdersmayonlyvoteduringthe meetingiftheyproperlyrequestandreceivealegalproxyintheirnamefromthebroker,bankorothernomineethatholds theirshares.SharesheldthroughourEmployeeSavingsPlanmaynotbevotedduringthemeeting.Whetherornotyou plantoattendthevirtualAnnualMeeting, weurgeyoutovoteandsubmityourproxypromptlybyfollowingthe instructionsonyourNoticeofInternetAvailabilityofProxyMaterials,proxycardorvotinginstructionform. AveryDennisonCorporation |

AskingQuestionsDuringAnnualMeeting

WehavedesignedthevirtualAnnualMeetingtoensurethatyouhavethesamerightsandopportunitiesto participateasyouwouldatanin-personmeeting,withaneasy-to-useonlineplatformthatallowsyoutoattend,voteand askquestions.AfterwehavefinishedactingupontheAnnualMeetingitemsofbusinessandthemeetingisadjourned, ourExecutiveChairmanwillleadaQ&Asessionduringwhichweintendtoanswerallquestionssubmittedtimelythatare pertinenttoourcompanyortheitemsbroughtbeforestockholdervote.Answerstoquestionsnotaddressedduringthe meeting,ifany,willbepostedpromptlyafterthemeetingontheinvestorssectionofourwebsite.Forinformationonhow tosubmitquestionsduringtheAnnualMeeting,pleaserefertothe VotingandMeetingQ&A sectionofthisproxy statement.

OURCOMPANY

Weareaglobalmaterialsscienceanddigitalidentificationsolutionscompanythatprovidesawiderangeof brandingandinformationsolutionsthatoptimizelaborandsupplychainefficiency,reducewaste,advance sustainability,circularityandtransparency,andbetterconnectbrandsandconsumers. Ourproductsandsolutions includelabelingandfunctionalmaterials,radiofrequencyidentification(RFID)inlaysandtags,softwareapplicationsthat connectthephysicalanddigital,andavarietyofproductsandsolutionsthatenhancebrandedpackagingandcarryor displayinformationthatimprovesthecustomerexperience.Weserveanarrayofindustriesworldwide,includinghome andpersonalcare,apparel,generalretail,e-commerce,logistics,foodandgrocery,pharmaceuticalsandautomotive.

Ourcompanyiscomposedoftworeportablesegments,MaterialsGroupandSolutionsGroup. MaterialsGroupisa leadingprovidertopressure-sensitivelabelandgraphicsindustriesworldwide.Ourinnovativeproductsincludelabel materials,graphicsandreflectivematerialsandfunctionalbondingmaterials,suchastapes.Ourlabelmaterials enhanceshelfappealforbrands,informshoppers,advancecircularity,increasetransparency,helpreducewasteand improveoperationalsupplychainefficiency. Ourgraphicsportfoliooffershighlyengineeredmaterialsthatrangefrom vehiclewrapstoarchitecturalfilms.MaterialsGroupplaysakeyroleinadvancingourfast-growingIntelligentLabels business,providingthematerialssciencecapabilitiesandprocessengineeringexpertiseessentialtodevelopingand manufacturingintelligentlabelsatscale.

SolutionsGroupisaleadingglobalproviderofinformationandbrandingproductsandsolutionsthatcovera breadthofcustomerneedsfromdigitalidentificationanddatamanagement,brandingandembellishment,aswellas productivity,pricingandretailmedia. Weempowercustomersacrossmultipleretailandindustrysegmentstoconnect thephysicalanddigital,leveragingourindustry-leadingRFIDsolutions. Ourtechnologyaddressescomplexcustomer challenges,providestransparencyandvisibilityacrosssupplychains,improveslaborandwasteefficiency,and enablesbetterconsumerexperiencesatthepointofpurchaseandbeyond. Marketsegmentsservedincludetheglobal apparel,logistics,foodandgrocery,andgeneralretailindustries.Asalargeultra-highfrequencyRFIDsolutionsprovider, weleverageourinnovationanddatamanagementcapabilities,globalfootprintandmarketaccessintheongoing advancementofourIntelligentLabelsbusiness.

STRATEGYOVERVIEW

Wearecommittedtoensuringthelong-termsuccessofallourstakeholders–ourcustomers,investors,employees andcommunities.Overthepastfiveyears,wehavefocusedondeliveringtoourpotentialbymanagingthroughmacro volatilitywhileevolvingouraspirations.In2023,weevolvedourlong-termstrategiesasshownbelow,addingavital newonethatreflectsourgrowingMaterialsandSolutionsconnectedcapabilitiesandcombiningtwoofourformer strategiesintoone

•Driveoutsizedgrowthinhigh-valueproductcategoriesthroughmarket-driveninnovation

•Growprofitablyinourbasebusinesses

•Leadattheintersectionofthephysicalanddigital

•Effectivelyallocatecapitalandrelentlesslyfocusonproductivity

•Leadinanenvironmentallyandsociallyresponsiblemanner

Ourcustomersareincreasinglylookingforhelpsolvingsomeofthemostcomplexindustrychallenges,includinglabor efficiencyandsupplychaineffectiveness;wastereduction,circularityandtransparency;andbetterconnectionbetween brandsandconsumers.Webelievethatphysicalitemswillneedadigitalidentitytosolvethesechallenges,andthatwe arewell-positionedtohelptheindustriesweserveovercomethem. Ourvisionistoleveragethestrengthsofour MaterialsandSolutionsbusinessestoleadattheintersectionofthephysicalanddigital.

2 2024ProxyStatement | AveryDennisonCorporation

Weplantorealizethisvisionthroughsegmentleadership,market-driveninnovation,andadvancementofintegrated digitalsolutions,leveragingourIntelligentLabelsbusiness.Ourareasoffocusaddresskeymegatrendsthatpresentboth risksandopportunitiesforourcompanyasweseektohelpourcustomersnavigatetheincreasinglydigitalworldand operatemoresustainably.

Ourstrategiesprioritizeusingourmarketinsights,drivinglong-terminnovationandenhancingthedigitalcapabilityof ourteams,whilecontinuingtoexecutewellinthecorebusinessesthathavebeenkeytooursuccess.Ourfivestrategic pillarsand2023achievementsareshownbelow.

STRATEGICPILLARS

1

Driveoutsizedgrowthinhigh-valuecategoriesthroughmarket-driveninnovation

•Weaimtoincrease,bothorganicallyandthroughacquisitions,theproportionofourportfolioinhigh-valuecategories thatservemarketsthataregrowingfasterthangrossdomesticproduct(GDP),representlargepoolsofpotentialprofit andleverageourcorecapabilities.TheseproductsandsolutionsincludeourIntelligentLabelsthatuseRFIDtagsand inlays,specialtyanddurablelabelmaterials,graphicsandreflectivesolutions,industrialtapes,external embellishments,andshelf-edgepricing,productivityandconsumerengagementsolutions.

•In2023, wecontinuedtoincreasetheproportionofourportfolioinhigh-valueproductcategories, withsignificant organicgrowthinIntelligentLabels,externalembellishments,andshelf-edgepricing,productivityandconsumer engagementsolutions,andtheacquisitionofthreecompaniesthatexpandtheexternalembellishmentcapabilitiesin ourSolutionsGroup. Overthepastfiveyears,wemorethandoubledthesizeofourIntelligentLabelsbusiness, withnetsalesof~$850millionin2023.

2

Growprofitablyinourbasebusinesses

•Westrivetogrowprofitablyinourbasebusinessesbycarefullybalancingvolume,priceandmix,reducingcomplexity andtailoringourgo-to-marketstrategies.

•In2023, weprotectedmarginsinourbasebusinesses throughproductreengineeringandproductivityactionsto mitigatetheimpactoflowervolumeastheindustriesweserveexperiencedsignificantinventorydestocking.

3

Leadattheintersectionofthephysicalanddigital

•Weconnectthephysicalanddigital,leveragingthecorecapabilitiesofourMaterialsandSolutionsbusinessestohelp ourcustomersoptimizelaborefficiencyandsupplychaineffectiveness,reducewaste,advancecircularityand transparency,andbetterconnectbrandswithconsumers.

4

Effectivelyallocatecapitalandrelentlesslyfocusonproductivity

•Webalanceourcapitalinvestmentinorganicgrowth,productivity,andacquisitionsandventureinvestments,while continuingtoreturncashtostockholdersthroughdividendsandsharerepurchasesandensurethatwemaintaina strongbalancesheetwithamplecapacitytoinvest.Inaddition,wetakeactionstorestructureouroperationsfrom timetotimeanduseproductreengineeringandenterpriseleansigmaprinciplestoexpandourmargins,enhanceour competitivenessandprovideafundingsourceforreinvestment.

•In2023, weinvested$285.1millioninfixedandinformationtechnology(IT)capitalexpenditurestosupport organicgrowth;completedthreeacquisitionsandmadeoneventureinvestmentforatotalof$224.9million; increasedourquarterlydividendrateby~8%;andrepurchased$137.5millioninsharesofourcommonstock.We alsodelivered~$69millioninpre-taxsavingsfromrestructuringactions,netoftransitioncosts.

Leadinanenvironmentallyandsociallyresponsiblemanner

•Weaimtoadvancetheenvironmentalsustainabilityofourcompanyandvaluechainbydeliveringinnovationsthat advancethecirculareconomy,reducingtheenvironmentalimpactofouroperations,andofferingvalue-creation opportunitiesforourcustomers.Wealsoseektomakeapositivesocialsustainabilityimpactbybuildingamore diverseworkforceandinclusiveandequitableculture,maintainingoperationsthatpromotehealthandsafety,and supportingourcommunities.

•In2023,wemadefurtherprogresstowardour2025and2030sustainabilitygoals, reducingtheenvironmental impactofouroperations andcontinuingtoinvestinoursustainabilitystrategicinnovationplatformfocused,among otherthings,onmaterialcircularityandwastereduction/elimination; drivingsustainablechangeindiversity,equity andinclusion(DEI);and providing$5.5millioninsupportforourcommunities,primarilythroughtheAvery DennisonFoundation(ADF).

Withthesestrategiesinmind,ournear-termprioritiesaretodeliveronourhigh-valuegrowthinitiatives;achieveour financialobjectivesforthefirsthalfoftheyear;deepenourecosystemengagementandexpandourM&Apipeline; acceleratesustainability-relatedanddigitalinnovation;andexpandorganizationalcapabilityinbothMaterialsand Solutions.

PERFORMANCEHIGHLIGHTS

2023Performance

Althoughalowerdemandenvironmentdrivenprimarilybysignificantinventorydestockingdownstreamfromour companyledtoachallenging2023,wedeliveredsequentialimprovementeachquarterduringtheyearandcontinued advancementinkeygrowthareassuchasIntelligentLabels.Marketconditionsweresignificantlyworsethanweinitially anticipated,whichresultedinournotrealizingourannualperformanceexpectations.Demonstratingstrengthand resiliency,wenavigatedthechallengingenvironment,protectingmargins;improvingserviceforourcustomers;deepening ourinsightsintothedriversofdemandandinventorythroughoutourvaluechain;continuingtoshiftourproductportfolio towardhigh-valuecategories,particularlyIntelligentLabels;andgeneratingstrongcashflow. Byleveragingourcore strengthsofproductivity,costmanagementandcapitalstewardshipandexpandingourpotentialinintelligentlabel solutions,wemitigatedtheimpactofthelowervolumeenvironmentonourbottomline.

Keyfinancialresultsfortheyearareshownbelow.

• Netsalesof$8.4billion, down7.5%from$9.0billionin2022,reflectinglowervolumeprimarilyasaresultof inventorydestocking

•Excludingtheimpactofcurrency,salesdeclined6.9%

• Reportedearningspershare(EPS)decreasedfrom$9.21in2022to$6.20in2023

•AdjustedEPSdecreased13.7%from$9.15to$7.90,primarilyreflectinglowervolume,partiallyoffsetby productivityandrestructuringactions

•With netcashprovidedbyoperatingactivitiesof$826.0million,deliveredadjustedfreecashflowof $591.9million;adjustedfreecashflowconversion,meaningtheproportionofnetincomewewereableto converttocash,wasmorethan100%

•On netincomeof$503.0million,achievedreturnontotalcapital(ROTC)of12.4%

Saleschangeexcludingtheimpactofcurrency(saleschangeex.currency),adjustedEPS,adjustedfreecashflowand ROTC–aswellasorganicsaleschange,adjustedearningsbeforeinterest,taxesdepreciationandamortization(EBITDA) andadjustedEBITDAmargin,whichareusedlaterinthisproxystatement–aresupplementalnon-GAAPfinancial measuresthatweuseinternallyandprovidetoassistinvestorsinassessingourperformance,operatingtrendsand liquidity.Thesemeasuresaredefined,qualifiedandreconciledfromgenerallyacceptedaccountingprinciplesinthe UnitedStatesofAmerica(GAAP)inAppendixAofthisproxystatement.Thesenon-GAAPfinancialmeasuresarenota substitutefororsuperiortothecomparablefinancialmeasuresunderGAAP.

Thefundamentalsofourbusinessshownbelowcontinuetoprovideuswithsignificantcompetitiveadvantage.

•Weareexposedtodiverseandgrowingendmarkets,withcatalystsforlong-termgrowth

•Weareindustryleadersinourprimarybusinesses,withstrengthinscaleandinnovation

•Wehaveaclearsetofstrategiesthathavebeenkeytooursuccessoverthelongtermacrossawiderangeof businesscycles

•Weareuniquelypositionedtoconnectthephysicalanddigitaltohelpaddresssomeofthemostcomplex problemsfacingtheindustriesweserve

ProgressToward2025FinancialTargets

InMarch2021,weannouncedfinancialtargetsthrough2025.Giventhechallengesweexperiencedin2023,our progresstowardtheselong-termtargetsslowedduringtheyear;however,weexpectsignificantprogressin2024as labelandapparelmarketsreboundandgrowthinourIntelligentLabelsbusinessaccelerates. Webelievethatour strategies,togetherwithourteam’sabilitytoexecuteinvariousenvironments,willallowustocontinuegenerating long-termvaluecreationthroughabalanceofGDP+growthandstrongreturns,asweunlocksignificantgrowth opportunitiesandourcorebusinessesrebound.

In2021-2023,onathree-yearcompoundannualbasis(with2020asthebaseperiod),GAAPreportednetsales increasedby6.3%,whileGAAPoperatingincome,netincomeandEPSdecreasedby1.1%,3.3%and2.1%,respectively. GAAPreportedoperatingmarginin2023was9.4%.

2021-2025Targets2021-2023Results(1)

(1) Resultsfornon-GAAPmeasuresarereconciledfromGAAPinAppendixAofthisproxystatement.

(2) Percentagesfortargetsreflectfive-yearcompoundannualgrowthrates,with2020asthebaseperiod. Percentagesforresultsreflectthree-yearcompoundannualgrowthrates,with2020asthebaseperiod.

(3) AlthoughadjustedEBITDAgrowthwasnotoneofouroriginalfinancialtargets,itwasimpliedbyoursales changeex.currencyandadjustedEBITDAmargintargets.Theforeigncurrencytranslationimpactto EBITDAwasabenefitofapproximately$38millionin2021andaheadwindofapproximately$81million and$20millionin2022and2023,respectively.

EffectiveCapitalAllocation

Wehaveinvestedinourbusinessestosupportorganicgrowthandacquiredcompaniesthatexpandourcapabilities inhigh-valueproductcategories,increaseourpaceofinnovationandadvanceoursustainabilitypriorities.Ourfixedand ITcapitalspendingin2023of$285.1millionwascomparableto2022,reflectingourcontinuedinvestmentinhigh-value categories,particularlyourIntelligentLabelsbusiness. Duringtheyear,weacquiredThermopatch,Inc. (“Thermopatch”),aNewYork-basedmanufacturerspecializinginlabeling,embellishmentsandtransfersforthe sports,industriallaundry,workwearandhospitalityindustries;LGGroup,Inc.(“LionBrothers”),aMaryland-based designerandmanufacturerofapparelbrandembellishments;andSilverCrystalGroup(“SilverCrystal”),aCanadabasedproviderofsportsapparelcustomizationsandapplicationsolutionsacrossin-venue,direct-to-businessand e-commerceplatforms;together,theseacquisitionsexpandtheexternalembellishmentsportfolioinourSolutionsGroup. Wealsomadeoneventureinvestmentinacompanydevelopingtechnologicalsolutionsthatwebelievehavethe potentialtoadvanceourstrategies.

In2023,wepaid$256.7millionindividendsof$3.18pershareandrepurchased0.8millionsharesofourcommon stock. Weraisedourquarterlydividendrateby~8%inApril2023.

Asshownbelow, overthelastfiveyears,wehavedeployedover$2billiontoacquisitions(includingventure investments)andreturnedover$2billiontostockholdersindividendsandsharerepurchases

Longer-TermTotalStockholderReturn(TSR)Outperformance

OurTSRin2023wasmodestlybelowtheTSRoftheS&P500IndexandtheS&P500IndustrialsIndexandmodestly abovetheDowJonesU.S.Container&PackagingIndex,threecomparatorgroupsweusetoassessourrelative performance.In2023,wedisaggregatedourmarketbasketcomparatorgroupusedinpreviousyearsintotheS&P500 IndustrialsIndexandtheDowJonesU.S.Container&PackagingIndex,ofwhichweareamember.Webelievethis presentationprovidesgreaterclarityonourrelativeperformance,reflectingitinamannermoreconsistentwiththe methodologyusedbypeercompanies.

Webelievethatourlonger-termTSRisamoremeaningfulmeasurethanourone-yearTSR,whichcanbeimpacted byshort-termmarketvolatilityunrelatedtoourperformance. Ourfive-yearcumulativeTSRsignificantlyoutperformed allthreeofthesecomparatorgroups.

1-,3-AND5-YEARTSR

AVY S&P500 Index S&P500 Industrials Index DowJones U.S.Container& PackagingIndex

201949%31%29% 29%

202021%18%11% 21%

202141%29%21% 11%

2022(15)%(18)%(5)%(18)% 2023 14%26%18% 8%

Index Dow Jones U.S. Container & Packaging Index

LEADERSHIPTRANSITION

3-YearTSR37%33%35% (2)% 5-YearTSR145%107%94% 53%

EXECUTIVECHAIRMAN PRESIDENT/CEO

InMay2023,MitchButierannouncedhisdecisiontostepdownasourCEO.OurBoardelectedMr.Butieras ExecutiveChairmaneffectiveSeptember1,2023toensureasmoothtransitionbyprovidingcounselandguidancetoour newCEO,notingthat, duringhistenureasCEO,ourcompanydeliveredsuperiorperformancewhilecreatingeven greaterfuturepotential,acceleratedgrowthandexpandedmargins,andadvancedoursustainabilitypriorities

6 2024ProxyStatement | AveryDennisonCorporation

MitchButier

DeonStander

OurBoardhasawell-establishedCEOsuccessionplanningprocessthatispartofitsbroaderongoingleadership successionplanning.Reflectingathoughtfulsuccessionprocess,inMay2023ourBoardelectedDeonStanderas President/CEO,effectiveSeptember1,2023.Mr.StanderhadbeenourPresident/ChiefOperatingOfficer(COO)since March2022,afterhavingservedasVicePresident/GeneralManagerofourbusinessnowknownasSolutionsGroup sinceJune2015. Havingevaluatedhisattributes,experiencesandstrengthsasaleaderduringmultiplediscussions overthepreceding18-24months,ourBoarddeterminedthatMr.Stander,whohasservedinanumberofleadership rolesacrosstheglobewithincreasingresponsibilityandimpactduringhis20-yearcareerwithourcompany,wasthe rightindividualtoleadourcompanyintothefuture. Mr.Standerhasaproventrackrecord,includingleadingthe transformationofourSolutionsbusinessandhelpingaccelerategrowthinIntelligentLabels.

Inconnectionwiththeirtransitionstotheserespectiveroles,givingconsiderationtotheadviceofitsindependent compensationconsultant,WTW,ourBoard’sTalentandCompensationCommittee(the“CompensationCommittee”) madethedecisionsdescribedbelowrelatedtothecompensationofMessrs.StanderandButier.

•ForMr.Stander,increasedhisannualbasesalaryfrom$700,000to$1.1millionandhistargetAnnualIncentivePlan (AIP)opportunityfrom75%to135%ofbasesalary,ineachcaseeffectiveSeptember1,2023.TheCompensation Committeepreliminarilyalignedtoincreasehistargetlong-termincentive(LTI)opportunityfrom300%to550%of basesalary,effectivewiththeannualLTIawardonMarch1,2024,subjecttoitsreviewofmarketpayforsimilarroles atthattime.Inaddition,theCompensationCommitteeapprovedaspecialpromotionawardofstockoptionson September1,2023withagrantdatefairvalueofapproximately$3million,50%ofwhichvestsoneachofthethird andfourthanniversariesofthegrantdate,ineachcasesubjecttohiscontinuedservice.

•ForMr.Butier,reducedhisannualbasesalaryfrom$1.3millionto$1millionandhistargetAIPopportunityfrom 160%to120%ofbasesalary,ineachcaseeffectiveSeptember1,2023.HereceivednospecialLTIawardin connectionwithhisrolechange.

2024DIRECTORNOMINEES(ITEM1)

Aspreviouslydisclosed,inFebruary2024,JuliaStewartnotifiedourBoardofherintentionnottostandforreelection attheAnnualMeeting.Asaresult,hermembershiponourBoardwillendonthedateoftheAnnualMeeting.

BoardPerformanceHighlights

OurBoardprovidesstrongoversightofourmanagementteamandcompany,withhighlightsofitsaccomplishments inrecentyearsdescribedbelow.

•Supportedmanagementinnavigatingourresponsetothepandemic,includingrelatedlabor,freightand inflationarychallenges,in2020and2021;pandemic-relatedchallengesinChina,theRussia-Ukrainewar,supply chaindisruptions,sizablecurrencymovementsandinflationarypressuresin2022;andlowerdemanddriven primarilybydownstreaminventorydestockingin2023

•Oversawmanagement’sconsistentexecutionofourstrategies,deliveringperformancethatexceededour2021 financialtargetsandprogressedustowardachievingour2025financialtargets,aswellas2019-2023TSRof 145%,significantlyoutperformingtheS&P500Index,S&P500IndustrialsIndexandDowJonesU.S. Container&PackagingIndex

•Supportedmanagementinevaluatingsynergisticacquisitiontargets,resultingin15companiesbecomingpartof ourportfolio,addingnewcapabilities,expandingourpositioninhigh-valueproductcategoriesandenhancing ouropportunitiesinthemarketplace

•ImplementedthoughtfulBoardrefreshmentanddirectorsuccessionplanningtoensurewemaintainahigh-caliber Board;mitigatethepotentialimpactofconcentratedmandatoryretirementsgiventheclosenessinageofmanyof ourdirectors;andfurtherenhanceoverallBoarddiversity,leadingtotheappointmentofthreenewindependent directorsinthelast18months,twoofwhomincreasedthegenderand/orethnicdiversityonourBoard

•Conductedregularexecutivesuccessionplanning,resultinginexperiencedleaderspromotedtomoresenior positions,includingournewCEOandSolutionsGroupPresident,eachappointedin2023

•Sharpenedfocusonadvancingoursustainabilityagenda,withcontinuousprogresstowardachievingour2025 sustainabilitygoalsandmoreambitious2030goals,aswellasenhancedsustainabilityreporting

MatrixofDirectorNomineeSkills,QualificationsandDemographicBackgrounds

Ourdirectornomineesbringabalanceofskills,qualificationsanddemographicbackgroundstotheirrolesinproviding oversightofourcompany,asshownbyindividualinthematrixbelow. Thismatrix,whichhasbeenrevisedand expandedfrompreviousyearsto,amongotherthings,specifykeyareasofindustryandfunctionalexperienceor expertise,reflectsadditionalinformationwesolicitedfromdirectorsinouryear-end2023questionnaire

Aspartofitsongoingdirectorsuccessionplanningprocess,theGovernanceCommitteeregularlydiscussedand reportedtoourBoardduring2023ontheskills,qualificationsanddemographicbackgroundsdesirableforourBoardto bestservetheneedsofourcompany.Aspartofthisprocess,theGovernanceCommitteeinitiatedasearchfornew directorswithretail/consumerpackagedgoods(CPG)orfinanceexpertise,whichledtotheappointmentofMaria FernandaMejiatoourBoardinFebruary2024.Thesearchforanindependentdirectorwithfinanceexpertisecontinues andisexpectedtoconcludeinthecomingmonths.

(1)

(2) ServiceasU.S.publiccompanyCEO,COOand/orCFO.

(4) Keyforindustryandfunctionalexperience:

(3) PriororconcurrentserviceonanotherU.S.publiccompanyboardexcludingcompaniesatwhichindividualservedorservesasCEO,COOand/orCFO.

• Technicalexpertise–Directmanagementexperienceorsubjectmatterexpertiseduringprofessionalcareer.

• Supervisoryexperience–Supervisorymanagementexperienceduringprofessionalcareer.

• Substantialknowledge–KnowledgefromservingonboardofanotherU.S.publiccompanyand/orgainedfrominvestmentbankingorprivateequity experience.

(5) Classificationsforgender,race/ethnicity,LGBTQ+,veteranandworks/workedoutsidetheU.S.basedondirectors’responsestoquestionnaire.

AveryDennisonCorporation

BoardGovernanceHighlights

Highlightsofourgovernanceprogramareshownbelow.

✓ Market-standardproxyaccess

✓ IfItem3isapprovedatAnnualMeeting,stockholderswillhavetherighttorequestthatwecall specialmeetingsofstockholdersat25%ownershipthreshold

StockholderRights

✓ Nosupermajorityvotingrequirements

✓ Nopoisonpill

✓ Noexclusiveforumorfee-shiftingbylaws

✓ Annualelectionofdirectors

✓ Majorityvotingindirectorelections

✓ Singleclassofoutstandingvotingstock

✓ Directornominees80%independent

✓ RobustLeadIndependentDirectorrole

BoardGovernance

✓ RegulardirectorsuccessionplanningandpacedBoardrefreshment,includingfournewdirectors appointedwithinlast18months

✓ Continuousexecutivesuccessionplanningandleadershipdevelopment

✓ AnnualBoard/Committeeevaluationsandindividualdirectorfeedbackprocess

✓ Mandatorydirectorretirementpolicyatage72withnoexemptionsorwaiversallowedorgranted

✓ BestpracticeGovernanceGuidelines

✓ StrongBoardandCommitteegovernance

✓ Directaccesstomanagementandexperts

SUSTAINABILITY

Wehavebeenconsistentlyfocusedonadvancingoursustainabilityagendabyestablishingourpriorities,setting ambitiousgoalsandmakingconsistentprogresstowardtheirachievement. Oursustainabilityprogressreflectsthe leadershipofourmanagementteamandtheengagementandoversightofourBoard,aswellasthecommitmentand passionofourteammembersworldwide.

SustainabilityGovernance

Webelievethatstrongsustainabilitygovernanceensuresconsistencyandaccuracyofinformationweusetoprovide transparencytoourstakeholders.Ourgovernancestructureisshownbelow.

SUSTAINABILITYGOVERNANCESTRUCTURE

Company

SustainabilityDataandReporting

Wecontinuetorefineandexpandthesustainabilitydatawedisclose,whichhasprovidedourstakeholderswith regularinsightintoourprogress. OursustainabilitydataisindexedtotheSustainabilityAccountingStandardsBoard (SASB)andGlobalReportingInitiative(GRI)frameworkstofacilitatecomparabilityofourresultswiththoseofother companies.Wepartneredwithathird-partyexperttoassessourdisclosuresagainsttherecommendationsofthe FinancialStabilityBoard’sTaskForceonClimate-relatedFinancialDisclosures(TCFD)regardingtheinformationthat companiesshoulddisclosetoallowtheirstakeholderstoassessandpricetheirclimate-relatedrisksandhavedeveloped aplantoalignwithTCFDrequirements.WealsoreporttoCarbonDisclosureProject(CDP)Climate,WaterandForests andsupportthegrowingadoptionofInternationalSustainabilityStandardsBoard(ISSB)standards. Weplantoassess ourreportingagainstISSBstandards,andotherdisclosuresthatincorporatethosestandards,aspartofourongoing sustainabilityreportingtransparencyefforts.

Oursustainabilityteamsassessourreportinginaccordancewithexternalframeworks;engagewith environmental,socialandgovernance(ESG)ratingagencies;manageourdatacollectionandreportingprocesses; establishandmonitorassuranceguidanceandcontrols;andapprovereports,dataandinformation.Inaddition,we engagean independentthirdpartytovalidateourenergyandgreenhousegas(GHG)emissionsdata. Having alignedwiththeAuditCommitteetoensureBoardoversightofsustainabilitygovernance,ourreportingprocesses ensure dataownersign-off,SustainabilityDisclosureCommitteereviewandseniormanagementapproval prior topublication.

OurMarch2024ESGDownload,beingmadeavailableonourwebsiteatesg.averydennison.comonorbeforethe filingofourdefinitiveproxystatement,reflectsourfocusandprogressonsustainabilityandgovernancematters.It includes~140metricscoveringourpolicies,goals,strategies,risks,outcomesandcertifications.Informationonour websiteisnotandshouldnotbeconsideredpartof,norisitincorporatedbyreferenceinto,thisproxystatement.

SustainabilityProgress

Sustainabilityisoneofourcorevaluesandhaslongbeenintegraltoourwayofdoingbusiness. Tocreatevaluefor allourstakeholders,weareadvancingoursustainabilitystrategicinnovationplatformfocused,amongotherthings, onmaterialcircularityandwastereduction/elimination;buildingamorediverseworkforceandinclusiveandequitable culture;maintainingoperationsthatpromotehealthandsafety;andsupportingourcommunities. Integrating sustainabilityintoourbusinessstrategieshashelpedusengageemployeesatalllevelstodeliversustainedprogress.

Inthefirsteightyearsofthe10-yearhorizonforour2025sustainabilitygoals,wehavemadesubstantialprogress, includingexceedingourgoalforcumulativeGHGemissionsreduction,asshowninthescorecardbelow.Youcanfind additionalinformationonoursustainabilityprogressinour2023IntegratedReportbeingfurnishedtotheSecuritiesand ExchangeCommission(SEC)priortothedistributionofourproxymaterials,aswellasinourMarch2024ESGDownload.

2023SCORECARDOFPROGRESSTOWARD2025SUSTAINABILITYGOALS

Greenhouse

GasEmissions

Achieveatleast3%absolutereductionyear-over-year andatleast26%cumulativereductionby2025

Paper

Films

Chemicals

Productsand Solutions

Waste

Source100%certifiedpaper,ofwhichatleast70%is ForestStewardshipCouncil®-certified

70%offilmswebuyconformto,orenableend productstoconformto,ourenvironmentalandsocial guidingprinciples

70%ofchemicalswebuyconformto,orenableend productstoconformto,ourenvironmentalandsocial guidingprinciples

Derive70%ofrevenuesfromsustainability-driven products(asdefinedbyourSustainableADvantage criteria)

2015

People

Transparency

Be95%landfill-free,withatleast75%ofourwaste reused,repurposedorrecycled

Continuetocultivatediverse(40%+femaleatlevelof managerandabove),engaged,safe(recordable incidentrate(RIR)of<0.25),productiveandhealthy workforce

Maintainworld-classsafetyandemployee engagementscores

Committogoalspubliclyandbetransparentin reportingprogress

2015

ReducedGHGemissionsbyadditional~7%in12 monthsthroughQ32023,ourmostrecentlyavailable data,comparedtosameperiodinprioryearandby ~63%cumulativelythroughQ32023comparedto baselineyear

Oftotalvolumeofpaperprocuredin2023,~96%was certified,with~79%offacestockForestStewardship Council®-certified

~97%of2023filmvolumeconformedtoMaterials Group’sRestrictedSubstanceList(RSL)

~96%of2023chemicalvolumeconformedto MaterialsGroup’sRSL

2015

~67%ofMaterialsGroup(basedonlyonLabeland GraphicMaterials)and~64%ofSolutionsGroup (basedonlyonApparelSolutions)salesin2023came fromsustainability-drivenproductsthatare responsiblysourced,enablerecyclability,contain recycledcontentoruselessmaterial

2015

Diverted~93%ofsolidwastefromlandfillsand recycled~64%ofwasteasofQ32023,ourmost recentlyavailabledata

Increasedfemalerepresentationatlevelofmanager andaboveby~4%frombaselineyear,reaching~36% atYE2023

2015

Continuedworld-classsafetyrecord,withRIRof0.22 in2023,substantiallybetterthanmanufacturing industryaverageof3.2in2022(mostrecently availabledata)

Employeeengagementof~80%*in2023

Continuedenhancingsustainabilitytransparencywith morecomprehensivereporting,includinginour IntegratedReports,proxystatementsandESG Downloads

*Datareflectschangeinengagementsurveyplatformandmethodology.

Aftercompletingourbiannualmaterialityassessmentin2020toprioritizethemostsignificantenvironmentaland socialsustainabilitychallengesthenfacingourcompanyandourstakeholders,weestablishedanadditionalsetof sustainabilitygoalsthatweareaimingtoachieveby2030.Withinthesegoals,wehavespecifictargets.In2022,we completedanenhancedmaterialityassessment,whichincludedanupdatedmappingofoursustainabilitypriorities throughoutourvaluechain.Thisprocessincludedinterviewswithinternalandexternalstakeholderssuchasmembersof management,customersandnon-governmentalorganizations(NGOs),aswellasindustryanalysis.Thetopicsthat rankedhighestintheassessmentalsooffersubstantialvalue-creationopportunitiesforourcompanyandcustomers. The mostmaterialtopicsidentifiedinour2022materialityassessment–transitiontoacirculareconomy,advanced technologiesandinnovation,climatechange,GHGemissionsandreduction,supplychain,fairandinclusive marketplace,materialsmanagementandoperationalwaste–areallreflectedinour2030sustainabilitygoalsand targets. Ourprogresstowardour2030goalsthrough2023isshownbelow.

2023SCORECARDOFPROGRESSTOWARD2030SUSTAINABILITYGOALS

Satisfytherecycling,compostingorreuserequirements ofallsingle-useconsumerpackagingandapparelwith ourproductsandsolutions

SolutionsGroup:100%ofourcoreproduct categories(printedfabriclabels,wovenlabels,paper, interiorheat-transferlabels,packagingandRFID) willmeetourSustainableADvantagestandard

Deliver innovationsthat advancethe circulareconomy

MaterialsGroup:100%ofourstandardlabel productswillcontainrecycledorrenewablecontent; allofourregionswillhavelabelsthatenable circularityofplastics

ReduceourScope1and2GHGemissionsby70%from our2015baseline.

Workwithoursupplychaintoreduceour2018baseline Scope3GHGemissionsby30%,withanambitionofnet zeroby2050

Source100%ofpaperfiberfromcertifiedsources focusedonadeforestation-freefuture

N/A~75%(basedonlyonApparelSolutions)

N/A~61%(basedonlyonLabelandGraphicMaterials)

Scope1and2:~63%;asofQ32023,ourmostrecently availabledata

N/A

Reducethe environmental impactinour operationsand supplychain

Makea positivesocial impactby enhancingthe livelihoodof ourpeopleand communities

Divert95%ofourwasteawayfromlandfills,witha minimumof80%ofourwasterecycledandthe remaindereitherreused,compostedorsenttoenergy recovery

Delivera15%increaseinwaterefficiencyatoursites thatarelocatedinhigh-orextremelyhigh-riskcountries asidentifiedintheWorldResourcesInstituteAqueduct Tool

Fosteranengagedteamandaninclusiveworkplace

•InclusionIndex:85%

•EmployeeEngagement:82%

•Femalesinmanagerlevelorabovepositions:40%

•Safety:RIRof0.20

SupporttheparticipationofouremployeesinADFgrants andfosterthewell-beingofthecommunitiesinwhichwe andoursupplychainoperate

•85%ofcountriesinwhichweoperatereceiveADF grants

•50%ofallADFgrantsincorporatevolunteerism

Scope3:Prior-yearcalculationspubliclyavailableinour mostrecentCDPClimateresponse*

2015~96%certified

2015

~89%landfill-free ~64%recycled

N/A~9%asofQ32023

2015

N/A

~76%**(N/Ain2015) ~80%**(from80%) ~36%(from32%) 0.22(from0.31)

MadeADFgrantsin~72%ofcountriesinwhichwe operate 95%ofgrantsincorporatedemployeevolunteerism

*OurScope3GHGemissionsreportingiscurrentlyspend-basedandfluctuateswithmarkettrendsandinflation. **Datareflectschangeinengagementsurveyplatformandmethodology.

PEOPLEANDCULTURE

Ouremployeeexperiencedependsonourculture,technologyandworkenvironment,whetherinanoffice,remoteor hybrid.Toenhancethisexperience, wehaveadvancedourprofessional-levelonboardingandexpandeddigitalaccess forourmanufacturingandremoteemployees;enabledthecontinuousgrowthofouremployeeresourcegroups (ERGs),whichareopentoallemployees;furtherenhancedflexibleworkarrangements;providedmoretargeted talentdevelopmentprogramming;andmaturedourenterpriseleaderdevelopmentprogram.

Wehavecontinuedannuallyevaluatingpayequity,makingadjustmentswhereappropriate.In2023,we reviewedpayequity(consideringtotalbaseandannualincentivecompensation)withrespecttogenderforall non-manufacturingemployeesglobally,aswellasallmanufacturingemployeesintheU.S.andcertainother countries,andwithrespecttorace/ethnicityforallU.S.employees.Ourteamsengagedwithcompanyleadershipon ourpayequity/transparencyprioritiesand implementedseveraladvancements,suchasincludingemployeesfrom recentlyintegratedacquisitionsinourpopulationdata,expandingouranalysistoincludelong-termincentives fordirector-levelandaboveemployees,andfine-tuningouranalyticmodelincertainregionstoreflecttheir uniquecircumstances. Wealsoenhancedpaytransparencytocomplywithevolvinglawsandregulations.

Diversityisoneofourcorevalues,reflectingourcommitmenttoensuringaninclusiveandequitableenvironment forpeopleofallbackgrounds.Itisourbeliefthatwegainstrengthfromdiverseideasandteams. OurDEIeffortsare intendedtofosteranenvironmentwhereouremployeescangrowandbeincreasinglyproductiveandinnovative, enhancingourreputationasagreatplacetoworkandallowingustoattractandretaintalentforthebenefitofour stakeholders.WeholdourselvesaccountableforourDEIprogressinour2030sustainabilitygoals.Overthepastseveral years,wehavesignificantlyadvancedourDEIjourney,asshownbelow.Our2023EEO-1statistics,whichreflectthe voluntaryself-identificationbyourU.S.employees,canbefoundinourMarch2024ESGDownload.

HIGHLIGHTSOFDEIJOURNEY

•Establishedgoalof40%+femaleatmanagerlevelandabove

2015

2016-2020

2021

•EmployeesestablishedfirstERG

•AddedDiversityasoneofourcompanyvalues

•EstablishedRegionalDEICouncils

•LaunchedandexpandedgenderpayequityreviewandbeganevaluatingU.S.racial/ethnicpayequity,ineach casemakingadjustmentswhereappropriate

•Beganrequiringgender-diversehiringslatesglobally

•Conductedunconsciousbiastrainingformanagersglobally

•Addedinclusionindextoannualemployeeengagementsurvey

•Expandedflexibleworkarrangements

•InitiatedWomen.Empowereddevelopmentprogram

•JoinedCEOActionforDiversity&Inclusion

•EmployeesestablishedseveralnewERGs,includingforwomenandBlack/AfricanAmerican,LGBTQ+and Latinxemployees

•FormalizedDEIstrategywithfourglobalpillarsandsupportingregionalfocusareas

•EstablishedDEIinfrastructurewithgloballeaderanddedicatedregionalresources

•Furtherenhancedpayequityreviewwiththird-partyanalysisofU.S.racial/ethnicdata

•BeganannuallypublishingEEO-1statistics

•Reachedmilestoneof20+ERGs,whichareopentoallouremployees

•ImplementedmoreequitablebenefitsforLGBTQ+employeesandtheirfamilies 2022-2023

•Madeadditionalprogressinfemalemanager+representation;ontracktoreach40%by2026

•Improvedglobalfemaleemployeeengagementandmaintainedrateoffemaledeparturesinmanager+ positionsdespitecompetitivetalentmarket

•GrewERGmembershipgloballyby30%+

•LaunchedADAdvocate,pairingexecutivestosponsorandmentortopdiversetalent

•Implementednewemployeeengagementsurvey,providingexpandedsetofquestionsmorereflectiveof marketbestpractices,enhancedcomparabilitywithpeers,improvedanalyticsandpulsesurveycapability

•CompletedfoundationalworkfocusedonDEIstrategicpillarsofwomenleaders,fairnessmanufacturing, inclusionandunderrepresentedgroups(fromhiringtodevelopmentandcareergrowth)

In2024,weplantomaintainourfocusonfairandtransparenttalentpracticesandstandards,equitableaccesstoopportunities forcareergrowthanddevelopment,andmanufacturingteamcommunicationandcamaraderie.

STOCKHOLDERENGAGEMENT

InadditiontoourongoinginvestorrelationsprogramthroughwhichourCEO,ChiefFinancialOfficer(CFO),business leadersandInvestorRelationsteamengagewithourinvestorsthroughouttheyear,foroveradecade,wehave semiannuallyengagedwithstockholderstosolicitfeedbackonourstrategies,executivecompensationandsustainability progress,offeringtoincludedirectorsasparticipantsinscheduledmeetings. Theobjectivesofthisprogramareto maintainregularandthoughtfulengagementtodirectlyobtaininvestorfeedback;continuetostrengthenour relationshipswithkeyinvestors;andgatherperspectivesonoursustainabilityandgovernanceprofiletoidentify potentialimprovementopportunities. OurBoardandmanagementbelievethatongoingstockholderengagementfosters adeeperunderstandingofevolvinginvestorexpectationsandhelpsensurewecontinuetoreflectbestpractices.

2023EngagementResults

2023ENGAGEMENTRESULTS*

OutreachConversations

In2023,wecontactedourtop35investorsin proxyseasonandtheoff-season.Board members,inparticularourLeadIndependent Director(LID),andmanagementweremade availabletoanswerquestionsanddiscuss mattersofinvestorinterest. Weengagedwith everystockholderwhorequestedameetingor acceptedourinvitationtomeet,andourLead IndependentDirectorledthemajorityofour off-seasonengagements.

*Basedonpercentageofsharesoutstanding.

Wediscussedtheresultsandfeedbackfromour2023engagementregardingexecutivecompensationandsocial sustainabilitywiththeCompensationCommitteeandregardinggovernanceandenvironmentalsustainabilitywithour Board’sGovernanceCommittee.WealsosharedhighlightswithourBoardtosupplementthereportsfromthose CommitteeChairs.

InFebruary2024,givingconsiderationtothefeedbackwereceivedfrominvestorsduringour2023engagements, ourBoardapproved,subjecttostockholderapprovalattheAnnualMeeting,aCertificateofAmendmenttoour AmendedandRestatedArticlesofIncorporationtoprovidethatstockholdersholding25%ofouroutstandingcommon stockhavetherighttorequestthatwecallspecialmeetingsofstockholders.

2023EngagementFeedback

Wediscussedourleadershiptransitioninalloff-seasonengagements,withinvestorsinterestedtolearnabout ourBoard’sexecutivesuccessionplanningprocess,engagementwiththeCEOsuccessorinandoutsidethe boardroom,andstrategicrationalefordeterminingMr.Standertobetherightindividualtoguideourcompanyinthe nextphaseofitsjourney. Stockholdersalsosoughttounderstandtherole,responsibilitiesandanticipatedtenureofour ExecutiveChairman.

GovernanceFeedback

Our2023engagementsprovidedfeedbackonthegovernancemattersdescribedbelow.

• Boardcomposition,includingtheappropriatenessofthebalanceofskills,qualifications,demographic backgroundsandtenuredistributiononourBoardgivenourevolvingstrategies

• Boardrefreshmentanddiversity,includingourdirectorsuccessionplanningprocesstoensurearobustpipeline ofpotentialnewdirectors,therationaleforrecentdirectorappointmentsandourGovernanceCommittee’s searchfornewdirectorswithretail/CPGorfinanceexpertise

• Boardleadershipstructure,includingourrationaleformaintaininganon-independentChairmancomplemented byaproactiveandengagedLeadIndependentDirector

•Our stockholderrights profile,particularlytheinabilityofourstockholderstorequestthatwecallspecial meetingsofstockholders

EnvironmentalSustainabilityFeedback

Environmentalsustainabilitywasasignificantareaoffocusforthestockholderswithwhichweengaged. Investors uniformlycommendedoursustainabilitytransparencyinthedisclosurescontainedinourIntegratedReports,proxy statementsandESGDownloads. Duringourconversations,weprimarilydiscussedthemattersdescribedbelow.

•Our progressagainstour2025and2030sustainabilitygoals,includingoursubstantialachievementofthe formersetofgoalsandwhetheradjustmentswouldbemadetotheoriginalgoalsorwouldbereflectedinour nextsetofsustainabilitygoals

•Our currentfocusareas,includinggoalattainment,actionstoaddressincreasingregulatoryrequirements, improvedtransparencyandESGratingsagencyengagement,andapproachtomateriality

•Our effortstoreduceScope3GHGemissions,includingourinvestmentininternalinfrastructurewithdedicated procurementresourcesineachofourbusinesssegments;partnershipwithCDPSupplyChaintooptimize engagementwithourcustomers;andmeasurementmethodology,includingourpotentialtransitionfromspendbasedtomaterials-basedmeasurementoftheseemissions

•Our2025 goalrelatedto70%sustainability-drivenproducts,includingourcriteriafordesignationas sustainability-drivenandourshiftfromourgoalsfor2025focusedonourproductstoourgoalsfor2030focused onwhatourproductsenableforourcustomersandendusers

•Our effortstowardaligningwithTCFDrequirements,includingourassessmentwithathird-partyexpertto understandourphysicalandtransactionalrisksandourplanstoincorporateTCFDintoourenterpriserisk management(ERM)andlong-termstrategicplanningprocesses

•Our netzeroambition,includinginternalstrategydevelopment,theimpactofourprogressreducingScope1and Scope2GHGemissions,andourdependenceonotherpartiestoreduceScope3GHGemissions

ExecutiveCompensationandSocialSustainabilityFeedback

Theprimaryfocusareasduringour2023engagementswereourleadershiptransition,Boardrefreshmentand governanceprofile;executivecompensationandsocialsustainabilitywerenotsignificanttopicsofdiscussion. Stockholdersdidexpressinterestinthe impactsofourleadershiptransitiononexecutivecompensation,includingthe compensationofournewCEOandourExecutiveChairman,aswellasanyadditionalincentivesprovidedtosenior leadersinconnectionwiththetransition.Investorscontinuedtowanttolearnmoreaboutthewaysinwhichweincent ourleaderstoprogresstowardachievingoursustainabilitygoals.

EngagementProcess

Robust and Ongoing Stockholder Engagement

YEAR-ROUND ENGAGEMENT PROCESS

Proxy Season Engagement Off-Season EngagementBoard/Committee Discussions

Offer meetings to top 35 investors with independent members of Board and/or management to discuss items being brought before stockholder vote; discuss preliminary Annual Meeting vote results with Board

Contact top 35 investors to seek meetings with our Lead Independent Director and management to discuss our strategies, Board, executive compensation, sustainability and governance

Report on process, results and feedback from engagement to senior management and Board; consider whether any program changes are advisable and reflect feedback in next year’s proxy materials

APPROVALOFEXECUTIVECOMPENSATION(ITEM2)

TheCompensationCommitteeoverseesourexecutivecompensationprogram,whichisdesignedtodeliverpayfor performance,withrealizedcompensationdependentonourachievementofchallengingannualfinancialtargetsand longer-termvaluecreationobjectivesthatadvancetheinterestsofourstockholders.

ExecutiveCompensationProgram

ThesubstantialmajorityofNamedExecutiveOfficer(NEO)targettotaldirectcompensation(TDC)isperformance based,meaningthatourexecutivesultimatelymaynotrealizethevalueofat-riskcomponentsifwefailtoachieve thedesignatedperformanceobjectives. TheCompensationCommitteeapprovesthetargetTDCofourNEOstoincent strongoperationalandfinancialperformanceandstockholdervaluecreation.ThemixandelementsofNEOtargetTDC areshownbelow.

*Mr.Stander’sannualizedtargetTDCreflectshiscompensationpackageasCEO,excludinghisspecialpromotionawardofstockoptionswithagrantdate fairvalueofapproximately$3million.

**Mr.Butierisexcludedbecausehistarget2023TDCprimarilyreflectedhiscompensationasCEOgiventhetimingofourleadershiptransition.Francisco Melo’stargetTDCmixincludedintheaveragereflectshistargetTDCasPresident,SolutionsGroup.

ELEMENTSOFNEOTARGETTDC

LTICompensation

CorporateNEOsSolutionsNEO

•50%ofLTIwithpayout= 0%to200%oftargetaward

PerformanceUnits(PUs)

Market-leveraged StockUnits(MSUs)

AIPAward(4)

•3-yearperformanceperiod

-CompanyEVA(1) (50%)

-CompanyRelativeTSR(2) (50%)

•50%ofLTIwithpayout= 0%to200%oftargetaward

•3-yearperformanceperiod

-SolutionsGroupEVA(75%)

-CompanyRelativeTSR(25%)

•RelativeTSRpayoutcappedat100%ifabsoluteTSRisnegative

•50%ofLTIwithpayout=0%to200%oftargetaward

•100%AbsoluteTSR(3)

•1-,2-,3-and4-yearperformanceperiods

BaseSalary

•Drivesperformanceconsistentwithannualcompanyorbusinessfinancialgoals

•Individualperformancemodifierbasedonachievementagainstpredeterminedstrategicand sustainabilityobjectives(generallycappedat100%forNEOs)

•Annualfixed-cashcompensationgenerallysetaroundmarketmedian

(1) EconomicValueAdded(EVA)isameasureoffinancialperformancecalculatedbydeductingtheeconomiccostassociatedwiththeuseofcapital (weightedaveragecostofcapitalmultipliedbyaverageinvestedcapital)fromafter-taxoperatingprofit.

(2) RelativeTSRcomparesourTSRtotheTSRofcompaniesinapeergroupsatisfyingcertainobjectivecriteriadescribedinthe CompensationDiscussion andAnalysis sectionofthisproxystatement.

(3) AbsoluteTSRmeasuresthereturnthatweprovidedourstockholders,includingstockpriceappreciationanddividendspaid(assumingreinvestmentof dividends).

(4) AIPawardforMr.MeloreflectsperformanceobjectivesandweightingsfortheninemonthsoftheyearheservedasPresident,SolutionsGroup.Hehad differentperformanceobjectivesandweightingsforthethreemonthsoftheyearheservedasSVP/GM,AveryDennisonSmartrac.His2023AIPaward wouldhavebeenproratedtoreflecttherespectiveperformanceobjectivesandweightingshadnotthepayoutbeenzero.

PayforPerformance

Inthegraphbelow,CEOcompensationfor2019through2022reflectsMr.Butier’scompensationasreportedinour SummaryCompensationTablesforthoseyearsand,for2023,Mr.Stander’scompensationasreportedinour2023 SummaryCompensationTable.OurCEOpayhasgenerallyreflectedourcumulativeTSRexceptthatMr.Stander’spayin 2023wassubstantiallylowerthanprior-yearamountsforMr.Butierbecauseitprimarilyreflectedhiscompensationas COO,whichwassignificantlylowerthanMr.Butier’sasCEO,aswellashisspecialawardofstockoptionswithagrant datefairvalueofapproximately$3milliongrantedinconnectionwithhispromotiontoCEO.Seethe Compensation DiscussionandAnalysis sectionofthisproxystatementformoreinformation.

FIVE-YEAR CEO PAY AND CUMULATIVE TSR

ExecutiveCompensationBestPractices

Assummarizedbelowanddescribedinfurtherdetailinthe CompensationDiscussionandAnalysis sectionofthis proxystatement,ourexecutivecompensationprogramalignswithourfinancialgoalsandbusinessstrategiesandreflects bestpractices.

Payfor Performance

Compensation BestPractices

✓ 87%ofCEO’sannualizedtargetTDCtiedtocompanyperformance

✓ RigorousstockownershippolicyrequiresCEOandExecutiveChairmaneachtoown6xrespective basesalary,50%+ofwhichmustbevestedshares;doesnotcountunvestedPUsorstockoptions andonlycounts50%ofunvestedMSUsattarget

✓ Double-triggerequityvestingrequiresterminationofemploymentafterchangeofcontrol

✓ YE2023three-yearaverageburnrateof0.50%,inlinewith50th percentileofS&P500companies

✓ Compensationclawbackpolicyforexecutiveofficersineventofaccountingrestatement;additional clawbackpolicyappliestoallAIPandLTIrecipients

✓ IndependentcompensationconsultantservesatdirectionofCompensationCommittee

✓ AnnualCompensationCommitteeevaluationandcharterreview

✓ Periodicstrategicreviewofcompensationprogramandassessmentofcompensationprogram featuresthatmitigateexcessiverisk-taking

✓ Releasesfromliabilityandrestrictivecovenantsfordepartingexecutives

✓ CompensationCommitteereviewofNEOtallysheetsreflectingallcompensationcomponents

✓ NoNEOemploymentcontractsunlessrequiredbylawsofhomecountry

✓ NoguaranteedAIPawards;2023NEOAIPawardsbasedsolelyonfinancialperformance

✓ Noexcisetaxgross-upsonchangeofcontrolseverancebenefits

✓ Notaxgross-upsonperquisites

✓ Noabove-marketinterestratesfordeferredcompensation

✓ Nore-pricingofstockoptionswithoutstockholderapproval

✓ NopayoutofMSUdividendequivalentsunlessanduntilawardsvest

✓ Nostockoptionsawardedbelowfairmarketvalue

✓ Nosupplementalretirementbenefits

APPROVALOFCERTIFICATEOFAMENDMENTTO AMENDEDANDRESTATEDCERTIFICATEOFINCORPORATION(ITEM3)

InFebruary2024,aftergivingconsiderationtothefeedbackwereceivedfrominvestorsduringour2023 engagementsanditsreviewofmarketpractices,upontherecommendationoftheGovernanceCommittee,ourBoard approved,subjecttostockholderapprovalattheAnnualMeeting,aCertificateofAmendmenttoourAmendedand RestatedCertificateofIncorporation(our“Charter”)toprovidethatstockholdersholding25%ofouroutstanding commonstockhavetherighttorequestthatwecallspecialmeetingsofstockholders.Theamendmentalsoremoves out-of-datereferencestothedeclassificationofourBoardthathadbeenfullyimplementedbyApril2014,providingthat directorsshallbeelectedannuallyforone-yearterms,consistentwithourexistingCharterandbestpractices.

RATIFICATIONOFAPPOINTMENTOFPwC(ITEM4)

TheAuditCommitteehasappointedPricewaterhouseCoopersLLP(PwC)asourindependentregisteredpublic accountingfirmforfiscalyear2024andourBoardisseekingstockholderratificationoftheappointment.PwCiswellqualifiedtocontinueservingasourindependentregisteredpublicaccountingfirm,hasadeepunderstandingofour operationsandaccountingpractices,andmaintainsrigorousprocedurestoensureindependencefromourmanagement andcompany,whichareoverseenbytheAuditCommittee.

TheAuditCommitteeconsideredthequalifications,performanceandindependenceofPwC,thequalityofits discussionswithPwC,andthefeeschargedbyPwCforthescopeandqualityofservicesprovided–aswellasthe firm’stenureasourindependentauditor–anddeterminedthattheappointmentofPwCfor2024isinthebest interestofourcompanyandstockholders.

GOVERNANCE

Thekeyfeaturesofourgovernanceprogramareshowninthe BoardGovernanceHighlights sectionoftheproxy summary.WeencourageyoutovisittheinvestorssectionofourwebsiteunderCorporateGovernance,whereyoucan viewanddownloadcurrentversionsofthedocumentsshownbelow.Informationonourwebsiteisnotandshouldnotbe consideredpartof,norisitincorporatedbyreferenceinto,thisproxystatement.

•Charter

•AmendedandRestatedBylaws(our“Bylaws”)

•CorporateGovernanceGuidelines(our“GovernanceGuidelines”)

•ChartersforourBoard’sAuditCommittee,CompensationCommittee,GovernanceCommitteeandFinance Committee

•CodeofConduct

•CodeofEthicsfortheCEOandSeniorFinancialOfficers

•AuditCommitteeComplaintProceduresforAccountingandAuditingMatters

Youcanrequestcopiesofthesedocuments,withoutcharge,bywritingtoourCorporateSecretaryat8080Norton Parkway,Mentor,Ohio44060.

VALUESANDETHICS

CodeofConduct,TalkaboutToolkitsandSupplierStandards

OurCodeofConductappliestoallofourdirectors,officersandemployeesandreflectsourvaluesofIntegrity, Courage,ExternalFocus,Diversity,Sustainability,Innovation,TeamworkandExcellence. Itincludesmessagesfrom ourCEOandChiefComplianceOfficer;detailedinformationregardinghigherriskareassuchasanti-corruption/bribery, antitrust,conflictsofinterest,insidertrading,anti-harassment,andcompliancewithlawsandregulations;andcase studiestoprovidepracticalguidanceonsituationsthatraisecomplexethicalquestions.TheCodeisavailablein33 languagesandourleadersaffirmtheircommitmenttocomplyingwithitwhentheyfirstjoinourcompanyandregularly thereafteraspartofourcompliancecertificationprocessdescribedinthe RelatedPersonTransactions sectionofthis proxystatement. WeplantoupdateourCodeofConductin2024torefreshitscurrentcontentandincludenew topics.

WeregularlytrainemployeesontheCodeofConducttopicsininstructor-ledsessionsheldinpersonorvirtually;in 2023,weheld~230ofthesesessionsglobally.Wealsodeploymandatoryonlinetrainingforourcomputer-based employees;in2023welaunchedoneenterprise-wideandfiveregionalcoursesusingatargetedrisk-basedapproach, withanaveragecompletionrateof~97%.Ourthree“Talkabout”Toolkits(alsoavailablein33languages)thatwedevelop eachyearempowermanagerstoengageinmeaningfuldiscussionswiththeirteamsregardingtopicsfromtheCodeof Conduct.Thesetoolkitsconsistofpresentationslides,whicharesupplementedbyinternalsocialmediacampaignsthat allowourteammemberstoengagewiththeircolleaguesacrosstheglobearoundourvaluesandethics.

Ourglobalsupplierstandardsextendourcommitmenttoourthird-partyserviceproviders,establishingour expectationthattheydobusinessinanethicalmanner.

BusinessConductGuideLine

OurBusinessConductGuideLine(the“GuideLine”)isawhistleblowerhotlineavailableatallhoursforemployees orthirdpartiestoreportpotentialviolationsofourCodeofConductorapplicablelaws,anonymouslyiftheyso choose.

TheGuideLinemaycurrentlybereachedby(i)calling800.461.9330toll-freeintheU.S.,toll-freeoutsideoftheU.S. usingthecountry-specificnumbersfoundinourCodeofConduct,or+1.720.514.4400directwithapplicablecharges fromanylocationor(ii)visitingwww.averydennison.com/guidelinereport.TheGuideLineisoperatedbyanindependent thirdpartyandacceptsreportsinanylanguagetoaccommodatetheneedsofourglobalworkforceandcustomer/supplier base.ReportsareinvestigatedunderthedirectionofourChiefComplianceOfficer,inconsultationwithourlaw departmentandseniormanagementandwithBoardoversightprimarilybytheGovernanceCommitteeand,forcertain finance-relatedmatters,alsobytheAuditCommittee.Weprohibitretaliationforgood-faithreporting.

20 2024ProxyStatement | AveryDennisonCorporation

CodeofEthics

OurCodeofEthicsrequiresthatourCEO,CFOandControlleractprofessionallyandethicallyinfulfillingtheir responsibilities.OnlytheAuditCommitteeortheGovernanceCommitteecanamendorwaivetheprovisionsofourCode ofEthics,andanyamendmentsorwaiversmustbepostedpromptlyonourwebsiteortimelyfiledwiththeSECona CurrentReportonForm8-K.WelastamendedourCodeofEthicsinApril2014andhavemadenoexemptionsor grantedanywaiverssinceitsinception.

CODEOFETHICSRESPONSIBILITIES

•Avoidactualorapparentconflictsofinterest

•EnsurecompleteandaccurateSECfilings

•Respectconfidentialityoffinancialandotherinformation

•Employcorporateassetsresponsibly

•ReportCodeofEthicsviolationstoChairofAuditorGovernanceCommittees

Supportingfulfillmentoftheseresponsibilities,ourcontrollershipandinternalauditfunctionsensurethatwemaintain arobustinternalcontrolenvironment,withtheleadersofthesefunctionsregularlyreportingto,andperiodicallymeeting inexecutivesessionwith,theAuditCommittee.

COMPLAINTPROCEDURESFORACCOUNTINGANDAUDITINGMATTERS

TheAuditCommitteehasadoptedproceduresfortheconfidential,anonymoussubmissionofcomplaintsrelatedto accounting,accountingstandards,internalaccountingcontrolsandauditpractices.

Theseproceduresrelatetoreportsof(i)fraudordeliberateerrorinthepreparation,evaluation,revieworauditofour financialstatementsorotherfinancialreports;(ii)fraudordeliberateerrorintherecordingormaintenanceofourfinancial records;(iii)deficienciesin,ornoncompliancewith,ourinternalaccountingcontrols;(iv)misrepresentationorfalse statementregardinganymattercontainedinourfinancialrecords,statementsorotherreports;or(v)deviationfromfull andfairreportingofourfinancialcondition.Anyperson,includingthirdparties,maysubmitagood-faithcomplaint regardingaccountingandauditingmattersandemployeesmaydosowithoutfearofretaliation.TheAuditCommittee overseestheseprocedures,withinvestigationsconductedunderthedirectionofourinternalauditdepartmentin consultationwithourCorporateSecretary,ChiefLegalOfficer(CLO)andothermembersofseniormanagementtothe extentappropriateunderthecircumstances.

Stockholdersandotherinterestedpartiesinterestedincommunicatingregardingthesemattersmaymakea confidential,anonymousreportbycontactingtheGuideLineorwritingtotheAuditCommitteeChair,c/oCorporate Secretary,8080NortonParkway,Mentor,Ohio44060.

STOCKOWNERSHIPPOLICY

Ourstockownershippolicyrequiresthatour(i)non-employeedirectorsacquireandmaintainminimum ownershipinourcompanyof$500,000,(ii)ExecutiveChairmanandCEOacquireandmaintainminimumownership of6xtheirbasesalaryand(iii)Level2andLevel3executivesacquireandmaintainminimumownershipof3xand2x theirbasesalary,respectively. Atleast50%oftheapplicablerequirementmustbeheldinvestedshares.

Thevaluesofthefollowingshares/unitsareconsideredinmeasuringcompliancewithourstockownershippolicy: (i)sharesbeneficiallyownedordeemedtobebeneficiallyowned,directlyorindirectly,underU.S.securitieslaws;(ii)for officers,sharesorunitsheldinqualifiedandnon-qualifiedemployeebenefitplansand50%ofthevalueofunvested MSUsatthetargetpayoutlevel;(iii)fornon-employeedirectors,deferredstockunits(DSUs);and(iv)forofficersand non-employeedirectors,unvestedrestrictedstockunits(RSUs)subjecttotime-basedvesting.Unvestedstockoptions andPUsarenotconsideredinmeasuringcompliance.DSUs,whichrepresentannualcashretainersdeferredata director’selection,areincludedasownedunderthepolicybecausetheyareearneduponreceiptandwouldbepaidoutto aparticipatingdirectoruponhisorherseparationfromourBoard.

Untilanon-employeedirectororofficerachievestheirminimumownershiprequirement,theyarerequiredtoretain anysharesacquired,netoftaxes,fromthevestingofstockawardsorexerciseofstockoptions.Officersmaynot transactincompanystockuntiltheycertifythattheywillremainincompliancewithourstockownershippolicyafter givingeffecttothetransactiontheyplantoeffectuate.

TheCompensationCommitteeandtheGovernanceCommitteereviewedthestockownershipofournon-employee directorsinDecember2023andFebruary2024,respectively.Bothcommitteesnotedthat–excludingtheindividuals appointedin2022and2023– ourthen-servingnon-employeedirectorshadaverageownershipof12xtheminimum requirement, aligningtheirinterestswiththoseofourstockholdersandfurtherincentingtheirfocusonlong-termvalue creation. Allcurrentnon-employeedirectorshaveexceededtheminimumownershiprequiredbyourpolicy,except forMr.WagnerandMses.MejiaandReverberi,whohavefiveyearsfromthedateoftheirrespectiveBoard appointmentstoreachthatlevel.

TheCompensationCommitteereviewedexecutivestockownershipinDecember2023anddeterminedthat,withthe exceptionofourmostrecentlyappointedexecutiveofficerwhohasfiveyearsfromthedateofherappointmenttoreach herlevel, ourexecutiveofficers,includingallNEOs,hadachievedtheirminimumownershiprequirement.The complianceofournon-employeedirectorsandNEOswithourstockownershippolicyatyear-end2023isshownbelow.

STOCKOWNERSHIPPOLICYCOMPLIANCE

(1) MinimumrequirementsforExecutiveChairmanandCEO,Level2NEOsandLevel3NEOsreflect6x,3xand2x,respectively,ofyear-end 2023basesalary.

(2) Reflectsshares/unitsconsideredinmeasuringcompliancewithourstockownershippolicybasedontheaverageclosingpriceofourcommon stockfromOctober1toDecember31,2023.Allthen-servingnon-employeedirectors,otherthanMs.ReverberiandMr.Wagner,andNEOs werealsoincompliancewithour50%vestedsharesrequirementatyear-end2023.

(3) ExcludesMs.MejiawhowasappointedtoourBoardinFebruary2024.

(4) Ms.ReverberiandMr.WagnerwereappointedtoourBoardinFebruary2023andOctober2022,respectively,andhavefiveyearsfromtheir respectivedateofappointmenttoachievetheminimumownershiprequirement.

(5) AmountforMr.MelowasconvertedfromeurosusingtheaveragemonthlyexchangerateforDecember2023.

INSIDERTRADINGPOLICY

Ourinsidertradingpolicyprohibitsdirectors,officersandemployeesfromengagingintransactionsinanytypeof securitywhileinpossessionofmaterialnonpublicinformationrelatingtothesecurityortheissuerofthesecurityin breachofadutyoftrustorconfidence,whethertheissuerisourcompanyoranothercompany.Inaddition,(i)iftheyare inpossessionofmaterialnonpublicinformationregardinganyotherpublicly-tradedcompany,includingthatofour suppliers,customers,competitorsorpotentialacquisitiontargets,theymaynottradeinitssecuritiesuntiltheinformation becomespublicorisnolongermaterial;(ii)theymaynotpurchaseorsellanysecurityofanyothercompanywhilein possessionofmaterialnonpublicinformationobtainedinthecourseoftheiremploymentorservicewithourcompany; and(iii)theymaynotdirectlyorindirectlycommunicatematerialnonpublicinformationtoanyoneoutsideorwithinour companyotherthanonaneed-to-knowbasis.

Officer/Director10b5-1Plans

Ourinsidertradingpolicycontainsspecificrequirementsregardingcontracts,plansorinstructionstotradeinour company’ssecuritiesenteredintoinaccordancewithSECRule10b5-1,includingwithrespecttomultipleplansand modificationsorterminationsofexistingplans.Wereservetherighttosuspend,discontinueorotherwiseprohibit transactionsundera10b5-1tradingplanifwedeterminethatdoingsoisinthebestinterestofourcompany.

LimitedTradingWindows

OurinsidertradingpolicyrestrictstradingincompanystockbyBoardmembers,officersanddirector-levelemployees, oranyotherpersondesignatedbyourCorporateSecretary,duringblackoutperiods,whichgenerallybegintwoweeks beforetheendofeachfiscalquarterandendtwobusinessdaysaftertheissuanceofourearningsreleaseforthequarter. Additionalblackoutperiodsmaybeimposedwithorwithoutnotice,asthecircumstancesrequire.Alltransactionsin companystockmustbepreclearedbyourCorporateSecretary.Exceptfortransactionsunderapreviouslyestablished Rule10b5-1tradingplan,ifpreclearedindividualsbecomeawareofmaterialnonpublicinformationorbecomesubjectto ablackoutperiodbeforetheirtransactioniseffectuated,theymaynotcompletethetransactioneveniftheypreviously receivedpreclearance.

ProhibitionsonCertainTransactions

Ourinsidertradingpolicyprohibitsourdirectors,officersandemployeesfromshort-sellingcompanystock; transactinginputs,callsorotherderivativesecuritiesinvolvingcompanystock;orpurchasingfinancialinstruments (suchasprepaidvariableforwardcontracts,equityswaps,collarsandexchangefunds)designedtohedgeoroffset anydecreaseinthemarketvalueofcompanystock. Inaddition,directorsandofficersareexpresslyprohibitedfrom–andournon-officeremployeesarestronglydiscouragedfrom–pledgingsharesofourcommonstockascollateralfora loan,purchasingcompanysecuritiesonmarginorplacingcompanysecuritiesinamarginaccount.

Toourknowledgebasedonourreviewoftheirwrittenrepresentationsinourannualdirectorandofficer questionnaire,allofourBoardmembersandexecutiveofficerscompliedwithourinsidertradingpolicyduring2023 andnoneofthemengagedinanytransactionprohibitedthereby.

ENVIRONMENTALANDSOCIALSUSTAINABILITY

SustainabilityandDiversityaretwoofourcorevalues,drivingustoworkwithinourcompanyandacrossourvalue chaintoaddresstheenvironmentalandsocialimpactsofourproductsandpractices.

Weaimtocontinuallyimprovetheenvironmentalsustainabilityofourproducts,buildamorediverse,equitable andinclusiveworkforce,maintainoperationsthatpromotehealthandsafety,andprovidemeaningfulsupportfor ourcommunities.

BOARDOVERSIGHTANDMANAGEMENTRESPONSIBILITY

BoardoversightofenvironmentalsustainabilityandcommunityinvestmentisprimarilyconductedbytheGovernance Committee,whichreceivesareportfrommanagementoneachofthesetopicsatleastannually.Inaddition,ourfullBoard engageswithbusinessleadersontheirsustainabilityinitiativesduringitsregulardiscussionoftheirbusinessstrategies. InOctober2023,ourBoardengagedwithseniormanagementonoursustainabilityprogress,havingdiscussedwith themthroughouttheyearourinnovationeffortstoaddresstheincreasingdemandformoresustainableproducts, sustainabilitystrategicinnovationplatform,andbusinessandenterprisesustainabilitypriorities. Inearly2024,our Boardreviewedour2023IntegratedReport,whichincludesourprogressagainstour2025and2030sustainabilitygoals.

BoardoversightofsocialsustainabilityisprimarilyconductedbytheCompensationCommittee,whichdiscussedDEI, includingpayequityandtransparency,atmultiplemeetingsin2023andregularlyreviewsothermattersrelatedtotalent management,includingtheimpactofexecutivepromotions,rolechangesandexitsonU.S.racial/ethnicdiversityand globalgenderandgenerationalrepresentation. InDecember2023,ourBoardengagedwith,andchallenged managementon,ouremployeeexperience,includingreviewingtheresultsofouremployeeengagementsurvey obtainedthroughamoreadvancedplatformusingupdatedquestions,aswellasourprogressineachofourfourDEI strategicpillars. Theyalsodiscussedour2024planstoactivateenterprise-widestandardstomoreconsistentlyselect, promote,developandrewardtalent;globallyimplementamobileapplicationtobetterenableourmanufacturing employeestoaccesscompanyinformation;anddevelopatalentsolutionconnectingeverythingourteammembersneed forlearning,skillsadvancementandcareermobility.

WithstrategicguidanceanddirectionprovidedbyourCEO,managementisresponsibleforensuringthatwe continuetomakeprogresstowardachievingoursustainabilitygoalsthroughourSustainabilityCouncil,whichisledby ourenterprisesustainabilityleaderreportinginthiscapacitytoourCEO,whoisaccountableforourprogress.Thecouncil, whichiscomposedofacross-divisionalandcross-functionalgroupofmanagement,metregularlyduring2023toensure weprogresstowardour2025sustainabilitygoals,advanceourroadmapstoachieveour2030sustainabilitygoalsand targets,andaccuratelyreporttoourstakeholders. Ourenterprisesustainabilityleaderparticipatedinsubstantiallyall our2023off-seasonstockholderengagementstoreportonoursustainabilityprogressandanswerquestionsfrom investors.

ENGAGEMENTOFOURSTAKEHOLDERS

Wealignoursustainabilityprioritieswiththeexpectationsofourstakeholders.Weregularlycommunicatewiththem regardingoursustainabilityprogressandalsointerviewmembersofmanagementresponsibleforkeysustainability initiativesandthirdpartiesaspartofourbiennialmaterialityassessments.Ourmaterialtopicsandthefeedbackwe receivedengagingwithinvestorsonsustainabilitymattersduring2023canbefoundintheproxysummary.

PROGRESSTOWARDACHIEVINGOUR2025AND2030GOALS

Wepresentour2023scorecardsshowingprogressagainstour2025and2030sustainabilitygoalsintheproxy summary.Youcanfindadditionalinformationinour2023IntegratedReportbeingfurnishedtotheSECpriortothe distributionofourproxymaterialsandourMarch2024ESGDownloadbeingmadeavailableonourwebsiteat esg.averydennison.comonorbeforethefilingofourdefinitiveproxystatement.Informationonourwebsiteisnotand shouldnotbeconsideredpartof,norisitincorporatedbyreferenceinto,thisproxystatement.

WediscloseoursustainabilitymetricsinaccordancewiththeSASBandGRIframeworksandannuallyreportto CDPClimate,WaterandForests.WeareamemberoftheUnitedNationsGlobalCompactandhavemade commitmentstotheUnitedNationsSustainableDevelopmentGoalsandtheScienceBasedTargetsinitiative (SBTi),withourScope1,2and3GHGemissionsreductiontargetshavingbeenapprovedbySBTiasconsistent withreductionsrequiredtokeepwarmingtonomorethan1.5ºC.

DIVERSITY,EQUITYANDINCLUSION

HighlightsofourDEIjourneyareshownintheproxysummary. OurDEIstrategyisgroundedinthefourglobal pillars shownbelow.

•Increasingthenumberofwomenwhoholdleadershippositions

•Enhancingtheexperienceofourmanufacturingemployees

•Increasingrepresentationandinclusionforunderrepresentedgroups,withprioritypopulationsandactions establishedregionally

•Makingmeritandtransparencyevenmorefoundationaltoouremployeeexperience

MembersofourseniorleadershipformallysponsororactivelyengageinprogressingtheseDEIpillars.Toensure weachieveourgoals,weemployaGlobalDEIDirectorandadditionalresourcesineachofourregionstoadvise andsupportourRegionalDEICouncilsandERGs. Weregularlyreportto,andengagewith,ourstakeholdersso theycanassessourDEIprogressandhelpusadvanceourjourney.

OTHERTALENTMANAGEMENTMATTERS

SuccessionPlanning

LeadinguptoitsdecisioninMay2023toappointDeonStanderasournewCEO,ourBoarddiscussedleadership successioninmultiplemeetingsduringthepreceding18-24months,helpingensureasmoothtransition. Inaddition, inJuly2023,theCompensationCommitteereviewedleadershipteamchanges,assessedkeyareasofleadership developmentandsuccessionfocus,anddiscussedpotentialsuccessorstothemembersofourCompanyLeadership Team,whichincludestheleadersofourbusinessesandcorporatefunctions.InOctoberandDecember2023,the CompensationCommitteeagainreviewedleadershipchangesandthekeyareasoffocusinourMaterialsandSolutions businesses,aswellasenterprise-wide,withaviewtoensuringwehavetalentthatisreadytofillseniorexecutive positionsintheeventofavacancy.OurCompensationCommitteeChairreportedonthesereviewstoourBoard. Recognizingthatwehavehadseveralrecentleadershipchanges,includingtherecentappointmentsofournewCEOand SolutionsGroupPresident, ourBoardconductedleadershipsuccessionplanningatallofitsmeetingsduringthefirst halfof2023.

TheCompensationCommitteeregularlyreceivesreportsonexecutivenewhires,promotionsandrolechanges, departuresandopenpositions–aswellastheimpactofthesedevelopmentsonU.S.racial/ethnicandglobalgenderand generationalrepresentation–toassistwithsuccessionplanning.

LeadershipDevelopment

TheCompensationCommitteeoverseesourtalentmanagementprogramtoassistwithidentifyinganddeveloping ourfutureleaders.Wemaintainarobustperformancereviewprocessandprogressleadershipdevelopmentplansforour toptalent,whilealsoprovidingdevelopmentopportunitiestoouremployeesmorebroadly. Seniormanagementreports totheCompensationCommitteeonourleadershipatexecutivelevelsbyidentifyinghigh-potentialtalent,cultivating theskillsandcapabilitiestoenableidentifiedindividualstobecomeourfutureleaders,andensuringthattheyhave appropriatedevelopmentplansinplacetoprogressthemtowardroleswithgreaterresponsibility. OurBoardhasthe opportunitytoactivelyengagewithourbusinessandfunctionalleadersinandoutsidetheboardroom.Inaddition,Board membersperiodicallyvisitourfacilitiestomeetwithlocalmanagementandhavethefreedomtodirectlycontactanyof ouremployees.

COMMUNITYINVESTMENT

WithBoardoversightbytheGovernanceCommittee,ourcommunityinvestmenteffortshelpstrengthenthe communitiesaroundtheworldinwhichweoperate.WemakemostofourcommunityinvestmentsthroughADF,which annuallydistributesatleast5%ofitsassetsfromtheprioryear.ADF’sgrantmakingisaidedbyouremployees worldwide,whohelpidentifynonprofitorganizationsservingtheirlocalcommunitiesthatcanadvancetheirmissionand impactwithadditionalfinancialsupport.

In2023,afterundertakingaformalstrategicreviewprocess,ADFupdatedandrefineditsvision,missionand grantmakingfocusareas. ADF’supdatedgrantmakingstrategyfocusesfundingoncharitableorganizationsworking toincreaseeducationaccess,advanceenvironmentalsustainabilityandsupportsecurelivelihoods. Alongsideits grantmakingfocusareas,ADFcontinuessupportingdisasterresponse,DEIandnonprofitorganizationsidentifiedbyour employeesaroundtheworldaddressingchallengesintheirlocalcommunities.

ADFandourcompanycollectivelymade$5.5millioningrantsandotherfinancialcontributionsduring2023.

EnhancedFocusonGrantmaking

Insupportofitsenhancedvisionandmission,ADFprioritizesgrantstocommunitiesandgeographiesfacingthe greatestneed,aswellasorganizationsthatdemonstrateinclusivityandequityintheirwork.Thetotalamountofgrantsin eachpillar,aswellasselectgrantrecipients,madein2023, 95%ofwhichincorporatedemployeevolunteerism,are shownbelow:

~$980KTO INCREASEEDUCATIONACCESS

•AscendanceSDBBHDtosupportyouth empowermentprogramsinMalaysia

•FundacionLeerinsupportofliteracy programminginArgentina

•InstituteofInternationalEducationto providescholarshipstochildrenof companyemployeesincountrieswith significantemployeepresence

SupportingEmployeesinTimesofCrisis

2023ADFGRANTHIGHLIGHTS

~$650KTOADVANCE ENVIRONMENTALSUSTAINABILITY

•AshevilleGreenWorkstosupporturban heatmappingandtreecanopy restorationinNorthCarolina

•GiftoftheGiverstoimprovecleanwater accessinruralAfrica

~$1.3MTO SUPPORTSECURELIVELIHOODS

•UniversalAccessProjectoftheUN FoundationtosupporttheResilience FundforWomeninGlobalValueChains

•ConnectingDreamsFoundationto supportIndia’sfirstLGBTQICenterof ExcellenceinDelhi

•IslamicReliefUSAtoimproveeconomic accessforpeopleinPakistanandKenya

In2020,ADFlaunchedanEmployeeAssistanceFundtosupportcompanyemployeeswhohadbeensignificantly impactedbythepandemic;from2020to2022,thefunddistributed~$4.6milliontomorethan4,000individualsin27 countries.Withtheglobalimpactofthepandemichavingsubstantiallydiminishedbutthepotentialopportunityfor furtherimpactremaining,ADFconvertedthefundtoanEmployeeCrisisFundtoprovidefinancialassistancetoour employeesimpactedbynaturaldisastersandotherhumanitariancrises.In2023,thisfundprovidedsupportto475 companyemployeesinnorthernChinaimpactedbysevereflooding.

SupportingDisasterReliefEfforts

ADFpartnerswithanindependentnonprofit,GlobalGiving,topromoteandsupplementemployeegivingtodisaster reliefeffortsaroundtheglobe.Employeesareabletogivetoorganizationssupportingimpactedcommunities.In2023, 300+employeesmadedonationstotaling~$25,000toorganizationsrespondingtoearthquakesinTurkeyandSyriaand emergencyandlong-termsupporttopeopleinneedinGaza,IsraelandUkraine.ThesedonationswerematchedbyADF. Inaddition,ADFmadeagrantof$250,000toamemberorganizationoftheInternationalCommitteeoftheRedCrossto supportreliefeffortsinIsrael,wherewehaveasignificantemployeepresence.

PromotingDEI

ADFsupportedorganizationspromotingDEIglobally,withgrantstotaling$395,000.ADFcontinuedtoworkwithour company’sRegionalDEICouncilsandERGstoensurethatitsupportedorganizationsmakingadifferenceinthe communitiesinwhichourteammembersliveandwork.Inadditiontocertainofthegrantsshowninthechartabove, grantsin2023includedsupportforLGBTQ+youthinSingapore,veteransintheU.S.andpeoplewithdisabilitiesin Mexico. 26

EngagingEmployees

Ouremployeesadvanceourcommunityinvestmenteffortsatthelocallevelthroughtheirpersonalmonetary contributionsaswellasvolunteerism.ThroughADF’ssignatureGrantingWishesprogram,employeesnominatelocal NGOstoreceivegrantsandorganizevolunteerevents.In2023,ADFmade~$1millioningrantsin37countriesthrough GrantingWishes.

ProvidingCollegeScholarships

Partneringwithindependentthirdpartiestoadvanceeducationaccess,ADFprovidescollegescholarshipstothe childrenofcompanyemployees.TheU.S.Scholarsprogram,administeredinpartnershipwithScholarshipAmerica, annuallyawardsscholarshipsintheU.S.andCanada.In2023,ADFpartneredwiththeInstituteofInternationalEducation toprovidescholarshipsinBangladesh,Honduras,India,Mexico,SriLankaandVietnam,withplanstoexpandthe programtoadditionalcountriesinwhichwehaveasignificantemployeepresenceinfutureyears.

While2022markedtheendofADF’sSpiritofInvention(InvEnt)ScholarshipProgram,alumnifromrecentyears gatheredinpersonin2023havingbeenunabletomeetduringtheirparticipationduetopandemic-relatedrestrictions, givingthemtheopportunitytomeetwithregionalleadersofourcompanyandexpandtheirprofessionalnetwork.Over 10years,theInvEntprogramprovidedtuitionassistanceandprofessionaldevelopmentopportunitiestomorethan100 talentedscience,technology,engineeringandmathematicsscholars.

OURBOARDOFDIRECTORS

OVERVIEW

OurBoardoversees,counselsandensuresmanagementisservingthebestinterestsofourcompany,withaview towardmaximizingtheperformanceofourbusinessesanddeliveringlong-termvalueforourinvestors.

PRIMARYBOARDRESPONSIBILITIES

•EstablishBoard/Committeecomposition,structureandresponsibilitiestoensurestrong independentoversight

•Conduct directorsuccessionplanning tomaintain engagedanddiverseBoard withbalanceofskills,qualificationsand demographicbackgrounds

•Oversee businesses,strategyexecution,riskmitigation,sustainabilityprogressandgovernanceprofile

•Approve annualoperatingplan andstrategicdecisions,includingsignificantfixedandIT capitalexpendituresand acquisitions

•Maintain integrityoffinancialstatements

•Evaluateperformanceofseniorleadersanddetermine executivecompensation

•Conduct CEOandotherexecutivesuccessionplanning andhelpusdevelopleadersthatadvanceourfuturegrowthand ensurehigh-performingteams, diversetalentandequitableandinclusiveculture

2024DirectorNominees

OurGovernanceGuidelinesprovideourBoard’sviewthatasizebetween8and12directorsallowsforeffective Boardfunctioning,althoughitmayperiodicallycomprisealargerorsmallernumberofdirectors.UnderourBylaws,the exactnumberofdirectorsisfixedfromtimetotimebyBoardresolution.Aspreviouslydisclosed,inFebruary2024,Julia StewartnotifiedourBoardofherintentionnottostandforreelectionattheAnnualMeeting;sheiscontinuingtoserveas CompensationCommitteeChairthroughApril2024.OurBoardplanstofixthenumberofdirectorsat10following Ms.Stewart’sdeparturefromourBoard.

Our2024directornomineesareshowninthechartbelow.AsshownbyindividualintheDirectorNomineeMatrixin theproxysummary,theycollectivelybringabalanceofindustryandfunctionalexperiencesanddemographic backgroundsinoverseeingmanagementinadvancingourstrategiesandachievingourfinancialandsustainabilitygoals.

Theagesofourdirectornomineesrangefrom52to71,withanaverageageof61.Theirlengthsofservicerange fromlessthanoneto19years,withanaveragetenureonourBoardof8years.

BoardMeetingsandAttendance

OurBoardmetseventimesduring2023.Therewere24BoardCommitteemeetingsduringtheyear. Allincumbent directorsattendedatleast75%oftheirrespectiveBoardandCommitteemeetings;averageattendancewas100%. In addition,ourdirectorsregularlydiscussedstrategic,businessandfinancialmatterswitheachofourExecutiveChairman andourCEOoutsideofmeetings.Directorsarestronglyencouragedtoattendourannualstockholdermeetingsunderour GovernanceGuidelinesand allthen-servingdirectorsattendedthe2023AnnualMeeting

28

AdditionalBoardEngagement

Bringingtheirindustryandfunctionalexpertise,someofourdirectors–incertaincases,togetherwiththird-party experts–areprovidingsupplementalguidanceoutsidetheboardroomtomanagementinitsexecutionofourstrategic initiativesrelatedtodigitalsolutions,environmentalsustainabilityandfood,aswellasourfocusoncybersecurityrisk management.Atthistime, Mr.WagnerisamemberofourDigitalAdvisoryCouncilandourCybersecurityAdvisory Council;Mses.MejiaandReverberiaremembersofourCircularityandFutureofPackagingAdvisoryCouncil;and Mr.AlfordisamemberofourFoodAdvisoryCouncil.Messrs.Butierand/orStanderserveoneachoftheseAdvisory Councils.DirectorsservingonAdvisoryCouncilsarenotcurrentlyprovidedanyadditionalcompensationfordoingso,but thatcouldchangeforindependentdirectorsasthetimecommitmentsoftheirservicecontinuetobeassessed.

GOVERNANCEGUIDELINES

OurGovernanceGuidelinesprovidethegovernanceframeworkforourcompanyandreflectthevaluesofourBoard, ashighlightedbelow.Theyarereviewedatleastannuallyandamendedfromtimetotimetoreflectchangesinregulatory requirements,evolvingmarketpractices,recommendationsfromouradvisorsandfeedbackfromourinvestors.Our GovernanceGuidelineswerelastamendedinDecember2021.

BOARDGOVERNANCEHIGHLIGHTS

✓ Boardof10directornomineesreflectsincreasedrefreshmentinrecentyears

Board Composition

Director Independence

BoardLeadership Structure

BoardCommittees

BoardDuties

✓ Mandatoryretirementafterage72withnoexemptionsorwaiversallowedorgranted

✓ Onaverage,directornomineeageof61yearsandtenureof8years

✓ 50%ofdirectornomineesarewomenand/orfromotherunderrepresentedcommunities

✓ Directornominees80%independent

✓ Executivesessionsofindependentdirectorsheldat6Boardmeetingsin2023

✓ AnnualreviewofBoardleadershipstructure

✓ RobustLeadIndependentDirectorroleandindependentAudit,CompensationandGovernance Chairs

✓ AnnualcompositionreviewandperiodicstructuralreviewandChair/memberrotation(includingin July2023andFebruary2024)

✓ Actunderannuallyreviewedchartersreflectingbestpracticesandstakeholderexpectations

✓ DirectorsrequiredtoattendBoard/Committeeandstockholdermeetings

✓ Regularleadershipsuccessionplanning

✓ Ongoingreviewoflong-termstrategicplans,includingkeyrisksandmitigatingstrategies

✓ Directorsentitledtorelyonindependentlegal,financialorotheradvisorsatourexpense

✓ Newdirectorsreceiveorientationmaterialsandengagewithseniormanagementtofamiliarize themselveswithourBoardandcompany,andalsoparticipateinadditionalorientationsessions afterjoiningBoardcommitteestobetterunderstandresponsibilitiesandprocesses

Continuous Board Improvement

Director Qualifications

✓ Continuingeducationthroughmeetingswithmanagement,visitstoourfacilitiesandparticipationin directoreducationprograms

✓ AnnualevaluationprocessensuresBoard,Committees,Chairman,LeadIndependentDirectorand CommitteeChairsarefunctioningeffectively

✓ Individualdirectorfeedbackprocessadvancescontinuousdirectordevelopmentandassistswith Boardsuccessionplanning

✓ RegularreviewofBoardcomposition(includingindustryandfunctionalexperience,demographic backgrounds,tenure,andmandatoryretirementdate)andongoingdirectorsuccessionplanning

DIRECTORINDEPENDENCE

OurGovernanceGuidelinesrequirethatourBoardcompriseamajorityofdirectorswhosatisfythecriteriafor independenceunderNYSElistingstandardsandthatourAudit,CompensationandGovernanceCommitteesbe composedentirelyofindependentdirectors.Anindependentdirectorisonewhomeetstheindependencerequirements oftheNYSEandwhoourBoardaffirmativelydetermineshasnomaterialrelationshipwithourcompany,directlyor indirectlyasapartner,stockholderorofficerofanentitywithwhichwehaveabusinessrelationship.

Eachyear,ourdirectorscompleteaquestionnairedesignedtosolicitinformationthatmayhaveabearingonour Board’sindependencedetermination,includinganyrelationshipstheyhavewithourcompany,directlyorindirectlythrough ourcompany’ssaleorpurchaseofproductsorservicestoorfromanycompaniesorfirmsbywhichtheyareemployed.The GovernanceCommitteediscussesanydisclosuresmadeinthequestionnairesrelevanttoitsindependenceassessment withourCorporateSecretary,aswellasanytransactionsourcompanyhaswithdirector-affiliatedentities. InFebruary 2024,afterreviewoftheirrespectiverelationships,theGovernanceCommitteeconcludedthatonlyMessrs.Butierand StanderhadrelationshipsthatweredisqualifyingunderNYSElistingstandards,otherwisematerialorimpairingof directorindependence. UpontherecommendationoftheGovernanceCommittee,ourBoardaffirmativelydeterminedthe 9directorsnamedbelowservingforallorpartof2023,aswellasournewestdirectorappointedinFebruary2024,tobe independent.

2023INDEPENDENTDIRECTORS DIRECTORNOMINEEINDEPENDENCE*

BradleyAlford

AnthonyAnderson

KenHicks

AndresLopez

FrancescaReverberi

PatrickSiewert

JuliaStewart

MarthaSullivan

WilliamWagner

*DirectornomineeindependenceexcludesMr.Anderson,whodepartedfromourBoardinNovember2023,andMs.Stewart,who willleaveourBoardinApril2024.ItincludesMs.Mejia,whowasappointedtoourBoardinFebruary2024.

Foradiscussionofthepotentialimpactoftenureondirectorindependence,seethe BoardRefreshmentandDirector SuccessionPlanning sectionofthisproxystatement.

BOARDLEADERSHIPSTRUCTURE

EXECUTIVECHAIRMAN

MitchButier

ElectedannuallybyourBoard

LEADINDEPENDENTDIRECTOR

PatrickSiewert

Electedannuallybyindependentdirectors

PRIMARYRESPONSIBILITIES

InadditiontocustomarydutiesofChairman:

•Provide Board’scollectiveinputoncompanystrategies toCEO

•EngagewithCEOon value-enhancingstrategicopportunities,aswellasother keyrelationshipsandstrategicalliances

•SupportCEOandCompanyLeadershipTeamin expandinganddeepening relationshipswithkeystakeholders

•Participateincertain AdvisoryCouncils

• MentorCEO,actingasprincipalliaisonbetweenhimandBoardmembers

PRIMARYRESPONSIBILITIES

• Presideoverexecutivesessionsofindependentdirectors andBoardmeetings whereExecutiveChairmanisnotpresent

• ApproveBoardmeetingagendas,schedulesandotherinformationsentto ourBoard

• Callmeetingsofindependentdirectors

• Consultandmeetwithstockholders

OurGovernanceGuidelinesgiveourBoardthediscretiontoseparateorcombinetherolesofChairmanandCEOasit deemsappropriatebasedontheneedsofourcompanyatanygiventime.Tofacilitatethisdecision-making,the GovernanceCommitteeannuallyreviewsourBoardleadershipstructure,givingconsiderationto,amongotherthings,our financialposition,businessstrategiesandsustainabilityandgovernancepriorities,aswellasanyfeedbackreceivedfrom ourinvestorsandotherstakeholders.

Duringthefirsttwo-thirdsoftheyear,wehadacombinedChairman/CEOandaLeadIndependentDirector.In connectionwithourCEOtransition,ourotherdirectorsinJulyelectedMr.ButierasExecutiveChairmaneffective September2023fortheremainderofthetermendingattheAnnualMeetingbasedontheirbeliefthathisleadership wouldoptimizetheexecutionofourstrategicprioritiesashementorsMr.StanderinhisnewroleasCEO.Atthattime, theChairmanandCEOroleswereseparated,eachfilledbylong-servingleadersofourcompanywhohavedeveloped andexecutedourstrategieseffectivelytodeliverlong-termvalueforouremployees,customers,investorsand communities.BecauseMr.Butierremainsouremployee,Mr.Siewertwaselectedbyourindependentdirectorsthrough theAnnualMeetingtocontinueensuringindependentoversightofourBoard.

RobustLeadIndependentDirectorRole

OurrobustLeadIndependentDirectorrolebalancesourExecutiveChairmanrole,exercisingcriticaldutiestoensure independentdecision-makingintheboardroom.Mr.SiewertbeganservingasourLeadIndependentDirectorinApril2020 andwasmostrecentlyreelectedbyourindependentdirectorsinFebruary2024foraone-yeartermbeginningafterthe AnnualMeeting,subjecttohisreelection.OurGovernanceGuidelinesdefinehisprimaryresponsibilities,whichareshown inthechartabove.Mr.SiewertalsoperformedtheactivitiesdescribedbelowasLeadIndependentDirectorin2023.

•Oversawour newdirectorsearchprocess,includingmeetingregularlywithseniormanagementandtheexternal firmselectedbytheGovernanceCommitteetoleadthesearch;interviewingandassessinghigh-potential candidates;andleadingdirectorsuccessionplanningdiscussionswiththeGovernanceCommitteehechairs,as wellaswithourExecutiveChairman,ourCEOandotherBoardmembers

•Directedour Board/Committeeevaluationprocess,meetingindividuallywitheachotherdirectortoobtainverbal feedbacktosupplementtheirwrittenevaluations

•Ledthemajorityofouroff-season stockholderengagements

•Oversawour individualdirectorfeedbackprocess throughwhicheachdirectorwasabletoprovideanonymous writtenfeedbackontheirpeers,givingconsiderationtotheirpreparation,participationandengagementinand outsidetheboardroomwithaviewtoenhancingtheiroverallperformanceandassistingwithdirectorsuccession planning

• Consultedfrequentlywithourindependentdirectors andprovidedfeedbacktoourExecutiveChairmanandour CEObasedonthesediscussions,includingourBoard’sevaluationoftheir2023performancewiththe CompensationCommitteeChair

• MetregularlywithourExecutiveChairmanandourCEO,aswellasperiodicallywithothermembersof managementandrepresentativesofourindependentregisteredpublicaccountingfirm

SupplementingourLeadIndependentDirectorinprovidingindependentBoardleadershipareourAudit, CompensationandGovernanceChairs,allofwhomareindependent.

BoardLeadershipAssessmentandEvaluation

DuringourBoardevaluationprocessconductedduringthefourthquartersof2022and2023,Messrs.Butierand SiewertreceiveduniformlypositivefeedbackintheirrespectiverolesasChairmanandLeadIndependentDirector.

InMayandJuly2023,havingdelayeditsplanneddiscussionofthesemattersfromApril2023asaresultofits leadershipandBoardsuccessionplanningwork,theGovernanceCommitteeevaluatedourBoardleadershipstructure andrecommendedtoourBoardthatMr.ButiercontinueservingintheroleofChairman,notingthatheremainedbest positionedtoleadourBoardinoverseeingourstrategies.UpontherecommendationoftheGovernanceCommittee,our BoardelectedMr.Butier(withhimnotpresentforthediscussionorvote)asExecutiveChairmaneffectiveSeptember1, 2023throughtheAnnualMeeting.InFebruary2024,givingconsiderationtothevaluablementorshiphehasprovidedour newCEOandhissuccessfultransitiontotheroleofExecutiveChairman,upontherecommendationoftheGovernance Committee,ourBoard(withhimnotpresentforthediscussionorvote)electedMr.ButiertocontinueservingasExecutive Chairmanforaone-yeartermendingatthe2025AnnualMeeting,subjecttohisreelection.

AveryDennisonCorporation | 2024ProxyStatement 31

InJuly2023,theGovernanceCommitteealsorecommendedthatMr.Siewert(withhimnotpresentforthediscussion orvote)continueservingasLeadIndependentDirectorthroughtheAnnualMeeting.Havingalong-servingdirectorwith financeexpertiseandextensiveexperienceworkingoutsidetheU.S.serveasLeadIndependentDirectorhasprovided Messrs.ButierandStandervaluablecounselandguidancewhileensuringindependentBoardoversightofmanagement. ThecommitteealsorecognizedMr.Siewert’ssupportandsubstantialeffortwithourstockholderengagementprogram. TheGovernanceCommitteedeterminedthat,inlightofhisdemonstratedcommitment,engagementandstrong leadership,Mr.SiewertshouldcontinueensuringindependentstewardshipofourBoardinitsoversightresponsibilities. Thecommittee’sdecisiontookintoaccounthissignificantcontributionsasamemberandformerChairoftheAudit CommitteeandasthecurrentChairoftheGovernanceCommittee,aswellashismorethan25yearsworkinginAsia Pacific,aregionfromwhich ~30%ofour2023salesoriginatedand~56%ofouremployeeswerelocatedatyear-end 2023.UpontherecommendationoftheGovernanceCommittee,theindependentdirectorsonourBoardelected Mr.Siewert(withhimnotpresentforthediscussionorvote)asLeadIndependentDirectorthroughtheAnnualMeeting. InFebruary2024,upontherecommendationoftheGovernanceCommittee,theindependentdirectorsonourBoard electedMr.Siewert(withhimnotpresentforthediscussionorvote)tocontinueservingasLeadIndependentDirectorfor thetermendingatthe2025AnnualMeeting,subjecttohisreelection.

Duringour2023stockholderengagements,whilecertaininvestorsexpressedapreferenceforanindependent chairman,theyappreciatedtherationaleforourcurrentBoardleadershipstructuregivenourrecentCEOtransition andotherseniorleadershipchanges.

BOARDCOMMITTEES

EachofourBoardCommitteeshasawrittencharterthatdescribesitspurpose,membershipandmeeting structure,andresponsibilities.ThesechartersmaybefoundontheinvestorssectionofourwebsiteunderCorporate Governanceandarereviewedbytherespectivecommitteeatleastannually,withanyrecommendedchangesadopted uponapprovalbyourBoard.Amendedchartersarepromptlypostedonourwebsite.ThechartersoftheAudit Committee,CompensationCommitteeandGovernanceCommitteeweremostrecentlyamendedinDecember2023, December2023andOctober2021,respectively;thecharteroftheFinanceCommitteewasfirstadoptedbyourBoardin December2023.

OurBoardCommitteeshavetheabilitytodelegateauthoritytosubcommitteesandmayobtainadviceandassistance fromconsultants,legalcounselorotheradvisorsatourexpense.Inaddition,eachcommitteeannuallyevaluatesits performance.Theprimaryresponsibilities,membershipand2023meetingandattendanceinformationforthethree independentcommitteesofourBoardaresummarizedbelow.InJuly2023andFebruary2024,uponthe recommendationoftheGovernanceCommittee,ourBoardmodestlyadjustedthemembershipofitscommittees;the currentChairsandmembersarereflectedinthisproxystatement.

MEMBERS

MarthaSullivan(Chair)

AndresLopez

MariaFernandaMejia

PatrickSiewert

AUDIT COMMITTEE

WilliamWagner

Auditcommitteefinancialexpert:

Siewert

AllmemberssatisfyNYSE enhancedindependence standards

MEETINGS

2023meetings:8

Avg.attendance:90%

MEMBERS

JuliaStewart(Chair)

BradleyAlford

AndresLopez

KenHicks

FrancescaReverberi

AllmemberssatisfyNYSE

enhancedindependence standardsandqualifyas “non-employeedirectors”under ExchangeActRule16b-3

MEETINGS

2023meetings:5

Avg.attendance:100%

MEMBERS

PatrickSiewert(Chair)

BradleyAlford

JuliaStewart

WilliamWagner

AllmemberssatisfyNYSE independencestandards

MEETINGS

2023meetings:10

Avg.attendance:95%

PRIMARYRESPONSIBILITIES

• Overseefinancialstatementanddisclosurematters,includingquarterlyandannualearnings releasedocumentationandSECreports,internalcontrols,criticalaccountingpoliciesand practices,majorfinancialriskexposuresandsignificanttaxmatters

• Appointandoverseeindependentregisteredpublicaccountingfirm,includingevaluatingits qualificationsandindependence,aswellasscope,staffingandfeesforannualauditandother audit,revieworattestationservices,annuallyreviewingitsperformanceand regularly consideringwhethertoappointanewfirm; inaddition,approvecompensationand engagementofanyothersuchfirmpreparingorissuingauditreportsorrelatedworkor performingotherauditrevieworattestservices

• Overseeinternalauditfunction,includingappointing/dismissingseniorinternalauditor, evaluatinghisperformance,reviewingsignificantissuesidentifiedininternalauditsand management’sresponse,anddiscussingannualinternalauditplan,budgetandstaffing

• Performcomplianceoversightresponsibilities,includingoverseeingcybersecurityrisk managementandrisksrelatedtoinformationtechnologycontrolsandsecurity;maintaining proceduresforcomplaintsregardingaccounting,internalaccountingcontrolsorauditing matters;reviewingfinanciallysignificantlegalmatters;andmakingdeterminationsregarding certainCodeofEthicsviolations

• ApproveAuditCommitteeReport forproxystatement

PRIMARYRESPONSIBILITIES

•ReviewandapproveAIPandLTItargetswithincontextofcompanygoalsandCEOobjectives; evaluatecompanyandindividualperformancetodetermineCEOcompensation

•Reviewand approveseniorexecutivecompensation,includingbasesalariesandincentive compensation

• Conductleadershipsuccessionanddevelopmentplanning andregularlyreviewexecutive newhires,promotionsandrolechanges,departuresandopenpositions,aswellasexecutive diversitytrends

• Overseeexecutivecompensationstrategy,incentiveplans,equity-basedplansandbenefit programs

• Reviewandprovideoversightoftalentmanagementpoliciesandstrategies,including DEI and payequityandtransparency;leadershipcompensationplans,benefits,recruitingand retentionstrategies,anddevelopmentprograms;andemployeeengagement

• Reviewstockholderengagementprocess,resultsandfeedback relatedtoexecutive compensation,talentmanagementandsocialsustainability

• ApproveCD&AandTalentandCompensationCommitteeReport forproxystatement

• Overseestockholderapprovalofexecutivecompensationmatters,includingsay-on-payand say-on-frequencyvotes

• Assesscompensationprogramsforpotentialencouragementofexcessiverisk-taking

• Recommendnon-employeedirectorcompensation

• Administerclawbackpolicies providingforrecoupmentofincentivecompensationdetermined tohavebeenerroneouslyreceivedbyexecutiveofficersorotherAIPorLTIrecipients

PRIMARYRESPONSIBILITIES

• RegularlyreviewBoardcompositionandconductdirectorsuccessionplanning,identifying potentialnewBoardmembers andrecommendingdirectornominees/appointees

• AnnuallyconsiderBoardleadershipstructure andrecommendwhethertoelectindependent ChairmanorLeadIndependentDirector

• RecommendBoardandCommitteestructure,Chairsandmembers

• Recommendindependentdirectors basedonNYSEindependencestandards

•Reviewand approverelatedpersontransactions

• OverseeannualBoard/Committeeperformanceevaluationprocess,aswellasindividual directorfeedbackprocess

• ReviewGovernanceGuidelines andrecommendchanges

•Reviewandprovide oversightofgovernance,environmentalsustainabilityandcommunity investmentinitiatives,policiesandpractices

• Reviewstockholderengagementprocess,resultsandfeedback relatedtogovernance, environmentalsustainabilityandcommunityinvestment

• Reviewstockholderproposals

• OverseeValuesandEthicsprogramandCodeofConduct,evaluatesignificantconflictsof interestandmakedeterminationsregardingcertainCodeofEthicsviolations

COMPENSATION COMMITTEE

GOVERNANCE COMMITTEE

InadditiontotheabovecommitteesrequiredbySECrulesandNYSElistingstandards,upontherecommendationof theGovernanceCommittee,ourBoardformedastandalonenon-independentFinanceCommitteeinJuly2023,the responsibilitiesofwhichwerepreviouslyperformedbytheAuditCommittee.

MEMBERS

FINANCE COMMITTEE

MitchButier(Chair)

PatrickSiewert

DeonStander

MEETINGS

2023meetings:1

Avg.attendance:100%

EXECUTIVESESSIONS

PRIMARYRESPONSIBILITIES

Conductfinanceoversightresponsibilities,includingreviewingandmakingrecommendationsto ourBoardregarding:

• Capitalstructure inlightofourfinancialplans,currentoperationsandlong-termstrategies

• Capitalallocationstrategy,includingstockholderdividends,stockrepurchaseprogramand financialcapacityforsignificanttransactionssuchasstrategicinvestments,acquisitionsand divestitures

• Financingplans includingequity,debtorothersecuritiesofferingsandprivateplacementsthat maymateriallyimpactourfinancialposition

• Pensionplanfinancingstatus

•OtherfinancialmattersthatmanagementorourBoarddesirestohavereviewedbythe committee

OurBoardbelievesitisimportanttohaveseparateexecutivesessionswithMr.Butier,withMr.Stander,withbothof themandwithouteitherofthem,eachofwhichwasgenerallyheldat2023Boardmeetings.Ourindependentdirectors havecandiddiscussionsattheexecutivesessionsthatexcludeourExecutiveChairmanand/orourCEOduringwhichthey criticallyevaluatetheperformanceofthem,managementasawholeandourcompany. AsLeadIndependentDirector, Mr.Siewertpresidedoverthesixexecutivesessionsofindependentdirectorsheldduring2023.

OurBoardgenerallybeganits2023meetingswithoneoftwoexecutivesessionswithMessrs.ButierandStanderto discusskeyfocusareasandframemeetingdiscussions;thesecondsuchsessionattheendofthesemeetingsprovided timefortheBoardtoreflectandalignonkeypriorities,afterwhichourindependentdirectorsgenerallymetinexecutive session.

Executivesessionswerealsogenerallyheldforregular2023BoardCommitteemeetings.Thesesessionsexcluded membersofmanagementunlessthecommitteerequestedoneormoreofthemtoattendtoprovideadditional informationorperspective,inwhichcasethecommitteegenerallymetindependentlythereafter.

RISKOVERSIGHT

Managementisresponsibleformanagingtheday-to-dayrisksconfrontingourbusinesses,andourBoard overseesERM.Inperformingitsoversightrole,ourBoardensuresthattheERMprocessesdesignedandimplemented bymanagementarefunctioningeffectivelyandpromotingrisk-adjusteddecision-making. Theteamsleadingour businesseshaveincorporatedERM-rootedthinkingintotheirstrategicdevelopmentandexecution,assessingtherisks impactingtheirbusinessesandimplementingandadjustingmitigatingactionsonanongoingbasis.Inaddition,in consultationwithourriskmanagementteamandseniormanagement,theysemiannuallyprepareriskprofilesconsisting ofaheatmapandsummaryofkeyrisksandmitigatingstrategies,whichareusedtoprepareacompanyriskprofilebased onidentifiedbusinessrisksaswellasenterpriserisks.Amongotherthings,theserisksincludethemacroeconomic environment;climatechange,environmentalregulationandsustainabilitytrends;cybersecurity;operationalandsupply chaindisruptions;andM&A.

In2023,wefurtherenhancedourERMprogrambyassigningaccountabilityforkeyrisksandmitigatingstrategiesto identifiedbusinessorfunctionalleadersandbeganprioritizingmitigationstrategiesbasedondiscussionswithbusiness leadersledbyriskchampionsfromourlawdepartment.OurcomplianceandITfunctionsalsocontinuedtheirannual ERMreviews. TheseadvancementshaveallowedourERMSteeringCommitteetobenefitfromthecriticalthinking ofabroadercross-sectionofcompanyleaders. WeaimtocontinueadvancingourERMprogram,withoversightby ourBoard.

Wehaverobustprocessesthatsupportastronginternalcontrolenvironmentandpromotetheearlyidentificationand ongoingmitigationofrisks.Ourlegalandcompliancefunctions,includingourChiefComplianceOfficer,reporttoourCLO toprovideindependentevaluationofthechallengesfacingourbusinessesandourInternalAuditleaderreportstothe AuditCommitteeintheconductofhisoperationalresponsibilities,helpingensurehemaintainsindependencefrom management.

OurBoardasawholeoverseesrisksrelatedtoourfive-yearstrategicplanhorizon,exercisingthisresponsibilityby consideringtherisksrelatedtomanagement’sstrategiesandexecutionplans. OurBoardannuallyreceivesreportson theERMprocessandtheresultingcompanyriskprofile,engagingthroughouttheyearwithmanagementontheir strategicplansandkeyrisks. Employeeswholeadvariousriskareas–suchaslaw,informationtechnology,tax, compliance,sustainability,DEIandcommunityinvestment–reportperiodicallytoBoardCommitteesandoccasionallyto ourfullBoard.

Asshownbelow,ourBoardhasdelegatedelementsofitsriskoversightresponsibilitytoitsCommitteestomore efficientlycoordinatewithmanagementinriskmitigation.OurBoardreceivesreportsfromtheCommitteeChairs regardingtopicsdiscussedatcommitteemeetings,includingtheareasofrisktheyprimarilyoversee,andengagesonrisk mitigationduringitsregularengagementwithourleaders.

RISKOVERSIGHT

BoardofDirectors

•Businessstrategies

•AnnualoperatingplanandsignificantfixedandITcapital expenditures

•Corporategovernance

•Acquisitions,divestituresandothersignificanttransactions

•Enterpriseriskmanagement

AuditCommittee CompensationCommittee GovernanceCommittee FinanceCommittee

•Financialreporting processesandstatements, andinternalcontrols

•Informationtechnologyand cybersecurity

•Certainlegal,compliance andregulatorymatters

•Executivecompensationand successionplanning

•Annualandlong-termincentive plans

•Compensationclawback policies

•Non-employeedirector compensation

•Socialsustainability,including leadershipcompensation, benefits,andrecruitingand retention;DEI;andemployee engagement

•BoardandCommittee structureandcomposition

•Directorsuccession planning

•Governance, environmental sustainabilityand communityinvestment

•ValuesandEthics/ CodeofConduct

•Conflictsofinterestand relatedperson transactions

•Certainlegal,compliance andregulatorymatters

•Capitalstructureand allocationstrategy, includingstockholder dividends,stock repurchasesandfinancial capacityforstrategic transactions

•Financingplans,including debt,liquidityandother securitiesofferings

•Pensionplanfundingstatus

TheAuditCommitteeoverseesourinternalcontrolenvironmentandevaluatestheeffectivenessofourinternalcontrolsat leastannually.Supplementingtheseprocesses,theAuditCommitteemeetsregularlyinexecutivesessionwitheachofour CFO,Controller,InternalAuditleader,andrepresentativesofourindependentregisteredpublicaccountingfirm,andas neededwithothermembersofseniormanagementsuchasourCEOandCLO.TheGovernanceCommitteemeets semiannuallywithourChiefComplianceOfficertodiscuss,amongotherthings,significantinternalinvestigations.

During2023,ourBoardwasparticularlyfocusedonoverseeingtheriskareasdescribedbelow.

2023RISKFOCUSAREAS

• Navigatingchallengingnear-termbusinessenvironment –Addressinglowerdemanddrivenprimarilybydownstreaminventory destocking,aswellaspreparingforpotentialrecessionaryenvironmentthroughrigorousscenarioplanningandidentifiedpotential productivityandrestructuringactions

• FurtheracceleratingIntelligentLabelsadoption –Executingkeyapparelandlogisticsprograms,acceleratingnewsegmentanduse caseadoption,andexpandingmanufacturingcapacitytoensurewecandeliverforcustomersinthisfast-growingbusiness

• Advancingsustainableinnovationinitiatives –Acceleratingoursustainableinnovationeffortsthroughgovernmentalengagement andinvestmentinnewtechnologiestoturnsustainability-relatedheadwindsintoopportunitiesforcompetitivedifferentiation

• Advancingdigitaljourney –AcceleratingourdigitalstrategiesandevolvingourDigitalAdvisoryCounciltoadvanceourmarket insights,digitalcapabilitiesandinnovationtoleadatintersectionofphysicalanddigital

• Optimizingportfolioofbusinesses –IntegratingpreviouslyseparatedbusinessesintoMaterialsGroup,executingandintegrating acquisitions,andexpandingourM&Apipelineanddealconversion

• Advancingcybersecuritypreparedness –Addressingmorevolatilecybersecuritylandscapewithincreasingthreatson manufacturers,incorporatinglearningsfromofourmaturityassessmentsandpubliclyreportedincidentsatothercompanies

RisksAssociatedwithCompensationPoliciesandPractices

Asdescribedinthe CompensationDiscussionandAnalysis sectionofthisproxystatement,wemaintainbest practicesincompensationthatcollectivelyencourageongoingriskmitigation.TheCompensationCommitteeannually discusseswithmanagementanditsindependentcompensationconsultant,WTW,whetherourexecutivecompensation programismeetingthecommittee’sobjectives.Inaddition, theCompensationCommitteeperiodicallyengagesWTW toundertakeamoreformalassessmenttoensurethatourprogramdoesnotprovideincentivesthatencourage excessiverisk-takinginthemanagementoftheirrespectivebusinessesorfunctionalareas.Thecommitteemost recentlyconductedthisevaluationinFebruary2024.

TheCompensationCommitteenotedthekeyrisk-mitigatingfeaturesofourexecutivecompensationprogram describedbelow.

RISK-MITIGATINGFEATURES

✓ CompensationCommitteehasdiscretiontodecreaseAIPandLTIawardstopenalizepotentiallyriskyactions

✓ Clawbackpolicyrequiresrecoupmentofcertainincentive-basedcompensationtoexecutiveofficersifweare requiredtoprepareaccountingrestatementtocorrectmaterialnoncompliancewithanyfinancialreporting requirement;inaddition,allAIPandLTIrecipientsaresubjecttocompensationclawbackinconnectionwith financialrestatementindicatingfraudormisconduct

Governanceand

Oversight

PayPhilosophy andStructure

✓ Incentivecompensationplanstructureandtargetsreviewedwithincontextofmarketpractices,tiedtoannual businessplansandcompanygoals,andapprovedbyCompensationCommittee

✓ CompensationCommitteeannuallyevaluatesCEO/seniorexecutiveperformanceagainststrategic,financialand sustainabilitygoals

✓ Officersprohibitedfromhedgingorpledgingcompanystockandrequiredtoengageinstocktransactionsonly duringlimitedtradingwindows

✓ Focusonincentingstockholdervaluecreation,balancedbyretentionandotherconsiderations

✓ Incentivecompensationdesignedtoincentstrongannualfinancialperformanceandlong-termeconomicand stockholdervaluecreation,balancegrowthandefficientcapitaldeployment,andconsidersustainabilityprogress andindividualcontributionsthereto

✓ Substantialmajorityofleadershipcompensationdeliveredinlong-termequityorcash-basedawardstomotivate pursuitofsuperiorperformanceandsustainablegrowth

✓ Rigorousstockownershippolicy,withminimumownershiprequirementof6xforCEO;requiresnetshares acquiredtoberetaineduntilcomplianceisachievedandpre-transactioncertificationsofcontinuedcompliance

✓ Executiveseveranceplansconsistentwithmarketpractices,withdouble-triggerchangeofcontrolseverance benefitsonlyformostseniorNEOs

✓ AIPandLTIawardsincentachievementofannualfinancialgoalsandlong-termeconomicandstockholdervalue creation,usingmultipleperformanceobjectivescoveringdifferenttimeperiods

✓ AIPawardsnotguaranteed,withbelow-thresholdperformanceresultinginzeropayout,paymentssubjectto overallcapof200%andNEOindividualmodifiersgenerallycappedat100%

Incentive ProgramDesign

✓ Equityawardsfullyperformance-based,usingmultipleperformanceobjectives,vestingovermultipletime horizonsandsubjecttothresholdandmaximumpayoutopportunities

•PUscliffvestatendofthreeyearswithpayoutforrelativeTSRcomponentcappedat100%oftargetif absoluteTSRisnegative

•MSUsvestover1-,2-,3-and4-yearperformanceperiods(averageperformanceperiodof2.5years),with thresholdperformanceatabsoluteTSRof(15)%andtargetperformanceatabsoluteTSRof10%

Givenitsassessedlowriskineachofthesecategoriesandotherfactors,WTWadvisedtheCompensation Committeethatourexecutivepayprogramstrikesanappropriatepay-riskbalanceanddoesnotpresentrisk-related concerns.

TheCompensationCommitteehasconcludedthatourcompensationpoliciesandpracticesdonotcreaterisks thatarereasonablylikelytohaveamaterialadverseeffectonourcompany.

DIRECTOREDUCATION

InitialOrientation

Ourdirectororientationmaterialsanddiscussionswithmanagementgenerallycoverour(i)stakeholders,values, strategies,andfinancialandsustainabilitygoals;(ii)businessandcompanystrategies,risksandmitigatingactions; (iii)sustainabilityprioritiesandprogress;(iv)Boardsuccessionplanningobjectives;(v)informationregardingcompany leadershipandrecentBoard/committeemeetings;(vi)Board,governanceandcompanypolicies,includingourGovernance Guidelines,Committeecharters,conflictofinterestpolicy,non-employeedirectorcompensationprogram,insidertrading policyandCodeofConduct;(vii)investormessaging;and(viii)SECfilingsandsustainablyreporting.

InconnectionwithherappointmenttoourBoardinFebruary2024,weprovidedMs.Mejiawithinformation regardingthesematters.OurExecutiveChairman,CEOandothermembersofmanagementmetwithMs.Mejiato discussthemtoensureasmoothinitialonboarding.Ms.MejiaalsojoinedasanobserverinselectBoardCommittee meetingstobetterunderstandtheirrespectiveresponsibilitiesandwasassignedtwoindependentdirectorsonour Boardtohelpguidehercontinuedonboardingprocess.

ContinuingEducation

Ourongoingdirectoreducationprogramconsistsofregularinteractionswithandpresentationsfrommembersof managementregardingourbusinesses,strategies,financialperformanceandsustainabilityprogress,aswellasperiodic visitstoourfacilities. Inthespringof2023,ourBoardvisitedourheadquartersinMentor,Ohio,whichalsoservesas ourMaterialsGroup’sNorthAmericanheadquarters, andmetinformallywithmembersofthatbusiness’leadership. Visitstothatfacility,aswellastoourSolutionsGroupinnovationcenterinMiamisburg,Ohioandcertaininternational facilitiesinAsia,areplannedfor2024.

Weprovidedirectorswithaccesstoaboardroomnewsresourceplatformforthemtokeepinformedofregulatory developmentsandmarketpractices,andreimbursedirectorswhoattendcontinuingdirectoreducationprogramsforfees andrelatedexpenses.

BOARDANDCOMMITTEEEVALUATIONS

TheGovernanceCommitteeoverseesanannualperformanceevaluationofourBoard,Chairman,LeadIndependent DirectorandBoardcommittees,includingtheCommitteeChairs.OurBoardviewstheevaluationprocessasintegralto assessingitseffectivenessandidentifyingopportunitiesforcontinuedimprovement.Throughthisprocess,wehave continuallyimprovedBoardfunctioning.

Aspartofthisprocess,ourdirectorshistoricallyhadtheopportunitytoprovideourLeadIndependentDirectorcandid feedbackonotherdirectors. In2023,theGovernanceCommitteeimplementedamoreformalprocessfordirectorsto provideanonymizedindividualfeedbackontheirpeerstoadvancecontinuousimprovementandassistwithBoard successionplanning. ThesummarybelowfocusesonthebroaderBoard/Committeeevaluationprocess.

•WrittenevaluationsofBoard/Committee

1

Process

•Composition,includingbalanceanddiversityofskills,qualificationsanddemographicbackgrounds

•Meetingmaterials

•Meetingmechanicsandstructure

•Fulfillmentofresponsibilities

•Meetingcontentandconduct

•Overallperformance

•EffectivenessofChairman,LeadIndependentDirectorandCommitteeChairs

•One-on-onediscussionswithGovernanceCommitteeChairtoprovideadditionalperspectiveonwrittenevaluations

2

2023ReviewofResults

•Discussionofanonymizedevaluationresultsandfeedback

•ExecutiveChairman,LeadIndependentDirector/GovernanceCommitteeChairandCorporateSecretary

•GovernanceCommittee

•BoardinexecutivesessionwithExecutiveChairmanandCEO,discussingpotentialimprovementopportunities

•Committeesinexecutivesession,discussingpotentialimprovementopportunities

3

RecentImprovementActions

•Sharpenedfocuson executivesuccessionplanning andleadershipdevelopment,appointingnewCEOafterhavingevaluatedhis attributes,experiencesandstrengthsanddeterminedthathewasbestpositionedtoleadourcompanyintothefutureinwhichwe believeeveryproductwillhaveadigitalidentity

•Enhanced directorsuccessionplanningwithviewtowardmoreregularrefreshment,launchingnewdirectorsearchin2023 focusedoncandidateswithretail/CPGorfinanceexpertisethatcouldalsoincreasegenderorracial/ethnicdiversityonourBoard, withMs.MejiabeingappointedtoourBoardinFebruary2024

•Advanced strategicoversight,expandingmentorshipsbetweenindividualdirectorsandkeybusinessleadersandincreasingBoard engagementwithmembersofmanagementbelowseniorleadershiplevel

•Heightenedfocusonstrategicprioritiesof digitalsolutions and sustainability-driveninnovation,aswellas cybersecurityrisk management

•Continuousdiscussionof M&Apipelineandpotentialtargets,aswellasperformanceofacquiredcompaniesandintegration learnings

•Refined Boardscheduleandmeetingprocess,implementingadditionalexecutivesessionswithourExecutiveChairmanandour CEO,aswellasoneswitheachofthem,andconductingcertainCommitteemeetingsvirtuallytoexpandtimeforin-personfull Boardmeetings

•Continuedregular ExecutiveChairmanandCEOengagementwithdirectorsbetweenmeetings andincreasedtimededicatedto executivesessionsthatexcludeothermembersofmanagementtoprovidegreatertimeforBoard-onlydiscussion,afterwhich independentdirectorsgenerallymeetinexecutivesession

STOCKHOLDERENGAGEMENT

Wevaluefeedbackonourgovernanceprogramandactivelysolicitinputthroughstockholderengagementtoensure ourpracticesreflectnotonlyourevolvingbusinessstrategiesbutalsotheexpectationsofourstakeholders.This supplementalengagementprogramandthefeedbackwereceivedongovernancemattersaredescribedintheproxy summary.

CONTACTINGOURBOARD

OurBoardwelcomesfeedbackfromourstakeholders.Wereviewallcorrespondencereceivedfromstockholders, discussingfeedbackreceivedwithseniormanagementand/orourBoardasappropriate.Stockholdersandother interestedpartiesmaycontactourBoard,ExecutiveChairman,LeadIndependentDirector,anyCommitteeChairorany otherindividualdirectorconcerningbusinessmattersbywritingtoBoardofDirectors(orparticularBoardsubgroupor individualdirector),c/oCorporateSecretary,8080NortonParkway,Mentor,Ohio44060.

38 2024ProxyStatement | AveryDennisonCorporation

ITEM1–ELECTIONOFDIRECTORS

OurBylawsprovidethatthenumberofdirectorswillbefixedfromtimetotimebyresolutiondulyapprovedbyour Board.Aspreviouslydisclosed,inFebruary2024,JuliaStewartnotifiedourBoardofherintentionnottostandfor reelectionattheAnnualMeeting.OurBoardplanstofixthenumberofdirectorsat10followingMs.Stewart’sdeparture fromourBoardinApril2024.

EachofournomineesispresentlyservingonourBoardandhasconsentedtobeingnamedinthisproxystatement andservingifelectedbystockholders.Allnomineesarestandingforelectionforaone-yeartermendingatthe2025 AnnualMeeting.

MajorityVotingStandard;UnelectedDirectorResignationRequirement

Invotingfortheelectionofdirectors,eachsharehasonevoteforeachpositiontobefilledandthereisnocumulative voting.OurBylawsprovidefortheapprovalbyamajorityofvotescastfortheelectionofdirectorsinuncontested electionslikethisoneandrequirethatanincumbentdirectorwhoisnotreelectedtenderhisorherresignationfromour Board.OurBoard,excludingthetenderingdirector,wouldberequiredtodeterminewhethertoaccepttheresignation–takingintoaccounttherecommendationoftheGovernanceCommitteeandanyotherfactorsitconsidersappropriate–andpubliclydiscloseitsdecisionandrationalewithin90daysfromthedateelectionresultsarecertified.

BoardRecommendation

OurBoardrecommendsthatyouvoteFOReachofour10directornominees.

Thepersonsnamedasproxieswillvotefortheirelection,unlessyouspecifyotherwise.Ifanydirectornomineewere tobecomeunavailablepriortotheAnnualMeeting,yourproxywouldbevotedforasubstitutenomineedesignatedby ourBoardorwewoulddecreasethesizeofourBoard.

SELECTIONOFDIRECTORNOMINEES

DirectorsarerecommendedbytheGovernanceCommitteefornominationbyourBoardandelectionbyour stockholders.NewdirectorsmayalsoberecommendedbytheGovernanceCommitteeforappointmenttoourBoard, withtheirelectionbystockholderstakingplaceatthenextAnnualMeeting.AsshownintheDirectorNomineeMatrixin theproxysummary, ourdirectornomineesbringabalanceofindustryandfunctionalexperiencesandreflectdiverse demographicbackgrounds,allowingthemtoeffectivelydischargetheiroversightresponsibilities.

Inevaluatingwhethertorecommendaneworincumbentdirectornominee,theGovernanceCommitteeprimarily considersthecriteriadescribedbelow.

• Independence,toensuresubstantialmajorityofourBoardisindependent

• U.S.publiccompanyleadershipand/orBoardexperienceandworkingorhavingworkedoutsidetheU.S., aswellas industryandfunctionalexperience,ineachcaseconsideringfactorssuchassize,scopeand complexity

• Boardservice atotherU.S.publiccompanies

•Experienceinfinance,accountingand/orexecutivecompensation

•Forincumbentdirectors,Board/Committeeengagementandeffectiveness,meetingattendance,compliance withourstockownershippolicy,andmandatoryretirementdate

•Timecommitments,includingserviceonotherboards;directorswhoarepubliccompanyexecutiveofficers maynotserveonmorethanoneotherU.S.publiccompanyboard

•Potentialconflictsofinterest

•Demographicbackground;whenevaluatingnominees,thecommitteeonlyconsiders(andrequiresany searchfirmengagedtoprovide)candidateslatesthatincludehighlyqualifiedwomenandindividualsfrom otherunderrepresentedcommunities

•Abilitytocontributetoourcompany’s governanceandsustainability prioritiesandprogress

TheGovernanceCommitteereviewstheskills,qualificationsanddemographicbackgroundofanycandidatewith thoseofourcurrentdirectorstoensureourBoardhasabroaddiversityofexperiencesandviewpoints.Sourcesfor identifyingpotentialnomineesincludecurrentBoardmembers,seniormanagement,executivesearchfirmsandinvestors.

TheGovernanceCommitteeregularlyreviewedtheskills,qualifications,demographicbackgrounds,ages,tenures andscheduledmandatoryretirementdatesofourdirectorsandconductedBoardsuccessionplanningtoensurethat itcontinuestomeettheneedsofourbusinesses,effectivelyoverseemanagementinexecutingourstrategiesand advancetheinterestsofourstakeholders.Itssearchfornewdirectorswithretail/CPGorfinanceexpertiseledto Ms.Mejia’sappointmenttoourBoardinFebruary2024;thesearchforanadditionaldirectorwithfinanceexpertise continues.

StockholderSubmissionofDirectorNominees

TheGovernanceCommitteeconsidersstockholdernomineesonthesamebasisasitconsidersallothernominees.

AdvanceNoticeNominees

Stockholdersmayrecommenddirectorcandidatesbysubmittingthecandidate’sname,togetherwithhisorher biographicalinformation,professionalexperience,writtenconsenttonominationandtheotherinformationrequiredby ourBylaws,toGovernanceCommitteeChair,c/oCorporateSecretary,8080NortonParkway,Mentor,Ohio44060.Tobe consideredatthe2025AnnualMeeting,advancenoticestockholdernominationsmustcomplywiththedeadlinesand otherrequirementsdescribedinthe VotingandMeetingQ&A sectionofthisproxystatement.

ProxyAccessNominees

Astockholder,oragroupofnomorethan20stockholders,owningatleast3%ofourcompany’sstockcontinuously foratleastthreeyearsispermittedtosubmitdirectornominees(upto20%oftheBoard)forinclusioninourproxy materials,subjecttothedeadlinesandotherrequirementsdescribedinourBylaws.Forinformationonsubmittingproxy accessnomineesforthe2025AnnualMeeting,refertothe VotingandMeetingQ&A sectionofthisproxystatement.

BOARDREFRESHMENTANDDIRECTORSUCCESSIONPLANNING

OurBoard’songoingdirectorsuccessionplanningisdesignedtoensureanindependent,well-qualifiedBoard.

OurGovernanceCommittee’slong-termobjectiveistopositionourBoardforregularrefreshment,ensureaccess toabroadnewdirectorcandidatepoolandachieveamorebalancedtenuredistributionwithapproximately one-thirdcomprisedeachofnewerdirectors,medium-tenuredirectorsandlonger-termdirectors.

Tenure

OurGovernanceGuidelinescurrentlyprovidethatdirectorsarenotsubjecttotenurelimits.Whiletenurelimitscould helpensureregularBoardrefreshment,theycouldalsoresultintheprematurelossofadirectorwhooveralongerperiod oftimehasgainedvaluableexperienceandiscontinuingtosignificantlycontributetoourBoardandcompany.

OurBoarddeterminesitsrefreshmentpoliciesinlightofourevolvingstrategiesandfinancialposition,exercisingits discretioninthebestinterestofourcompanyandstockholders.Certainofourstakeholdershavesuggestedthatlongertenureddirectorsmayhavedecreasedindependenceandobjectivity.However,webelievethattheremovalof knowledgeabledirectorsandlossofoversightconsistencytheybring–particularlyduringperiodsofseniorleadership change,suchasourrecentCEOandSolutionsGroupPresidentappointments–areimportantcounterbalancing considerations.

PoliciesSupportingRegularBoardRefreshment

OurBoardhasthepoliciesdescribedbelowtofacilitateregularrefreshment,withthedescribedeventshaving occurredsincelastyear’sAnnualMeeting.

MandatoryResignation Policy

MandatoryRetirement Policy

ResignationTendered UponChangein PrincipalEmployment

PriorNoticeRequirement toPreventOverboarding

Incumbentdirectorsnotelectedby stockholdersmusttendertheir resignation

Directorsmustretireondateofannual meetingofstockholdersthatfollows theirreachingage72;noexemptionsor waiversallowedorgranted

Directorswhochangetheirprincipal occupation,positionorresponsibility mustvolunteertoresign

Directorsmustgivepriornoticebefore acceptinganotherU.S.publiccompany directorshipsothathis/herabilitytofulfill Boardresponsibilitiesmaybeevaluated ifhe/sheservesonmorethanfourother suchboards

Allincumbentdirectorsthenstandingforelectionwere electedatthe2023AnnualMeeting.

Nodirectorsweresubjecttomandatoryretirementin2023.

Thefollowingindependentdirectorschangedtheirprincipal employmentin2023:Ms.Reverberiassumedadditional responsibilitiesasleaderofTrinseo’sEngineeredMaterials division;Mr.HicksbecameExecutiveChairmanofAcademy Sports+Outdoors,transitioningoutoftherolesofPresident andCEO;andMr.SiewertretiredfromTheCarlyleGroup, continuinginanindependentadvisorycapacity.Ineachcase, theGovernanceCommitteedeterminedthatthedirector shouldremainonourBoard.

Mr.WagnerjoinedtheboardofBlackLine,Inc.inOctober 2023.Withthisappointment,henowservesonthreeother U.S.publicboards,whichiswithinourGovernanceGuidelines policyapplicabletoretireddirectors.

UpontherecommendationoftheGovernanceCommittee,Mr.WagnerandMses.MejiaandReverberiwere appointedasindependentdirectorstoourBoardinOctober2022,February2024andFebruary2023,respectively. Mr.StanderjoinedourBoardwhenhebecameCEOinSeptember2023.Mr.AndersondepartedfromourBoardin November2023andMs.StewartwillleaveourBoardinApril2024.Webelievethatthisrecentexperiencedemonstrates regularBoardrefreshment.

BoththeGovernanceCommitteeandourfullBoarddiscusseddirectorsuccessionplanningatmultiplemeetings heldin2023tooverseeasearchfornewdirectorsfocusedoncandidateswithretail/CPGorfinanceexpertiseto complementandadvancethecollectiveexperienceonourBoardandalsofurtherenhanceBoarddiversity.

BOARDCOMPOSITION

OurBoardsupportsandreflectsourvalues,recognizingthebenefitsofdiversityintheboardroom,includingthe healthydebatethatresultsfromdifferentviewpointsthatmaystemfromdiversebackgrounds.

AgeandTenure

Theaverageageandtenureofourdirectornomineesis61and8years,respectively.Ourdirectornomineesinclude newerdirectorsbringingfreshideasandinsightsintotheboardroomandlonger-servingdirectorswithdeepinstitutional knowledgeofourBoardandcompany.

GenderandRacial/EthnicDiversity

OurGovernanceGuidelinesreflectthattheGovernanceCommitteeseekstorecommendindividualswithabroad diversityofexperience,skills,geographicrepresentationanddemographicbackground. Whilediversityisa considerationandanareaofBoardrefreshmentfocus,theGovernanceCommitteefocusesonacandidate’soverall profiletocomplementthoseoftheexistingmembersofourBoard. Whenevaluatingdirectorcandidates,the GovernanceCommitteeonlyconsiders(andrequiresanysearchfirmengagedtoprovide)candidateslatesthatinclude highlyqualifiedwomenandindividualsfromotherunderrepresentedcommunities; twoofourthreemostrecently appointedindependentdirectorsincreasedthegenderand/orethnicdiversityonourBoard.

DIRECTOR NOMINEE DEMOGRAPHICS

* One director included in both categories

2024DIRECTORNOMINEES

Thefollowingpagesprovideinformationonour2024directornominees,includingtheirage,lengthofservice, independence,currentBoardrolesandbusinessexperienceduringatleastthepastfiveyears.Wealsoindicatethename ofanyotherU.S.publiccompanyboardonwhicheachnomineecurrentlyservesorhasservedduringthepastfiveyears.

Foreachnominee,wepresentselectskillsandqualifications,whichincludesU.S.publiccompanyleadership experience,U.S.publiccompanyboardexperience,areasofindustryandfunctionalexperience,andexperienceworking orhavingworkedoutsidetheU.S.Thebalanceofskills,qualificationsanddemographicbackgroundsonourBoardis shownintheDirectorNomineeMatrixintheproxysummary;consistentwiththatdisclosure,SelectSkillsand QualificationsexcludesboardserviceatU.S.publiccompaniesatwhichtheindividualservedorservesasCEO,COOor CFO.AlldirectornomineeshavedemonstratedtheabilitytofulfillthetimecommitmentsnecessarytoserveonourBoard andadvancethelong-terminterestsofourstockholders,aswellasthoseofourotherstakeholders.

Age61

DirectorsinceFebruary2017

Independent

Age67

DirectorsinceApril2010

Independent

Age55

DirectorsinceSeptember2023

NotIndependent

ANDRESA.LOPEZ

RECENTBUSINESSEXPERIENCE

O-IGlass,Inc.,aglasscontainermanufacturerand suppliertofoodandbeveragebrands

•President&CEOsinceJanuary2016

•COO&President,GlassContainers,from January2015toDecember2015

•President,O-IAmericas,fromJuly2014to July2015

•President,O-ILatinAmerica,fromApril2009 toJuly2014

BOARDROLES

AuditCommitteeMember

CompensationCommitteeMember

OTHERPUBLICCOMPANYBOARDS

Current:

O-IGlass,Inc.

PastFiveYears:

None

BRADLEYA.ALFORD

RECENTBUSINESSEXPERIENCE

NestléUSA,anutrition,healthandwellness company

•Chairman&CEOfromJanuary2006to October2012

NestléBrandsCompany,anoperatingunitofNestlé USA

•President&CEOfrom2003toDecember 2005

BOARDROLES

CompensationCommitteeMember GovernanceCommitteeMember

OTHERPUBLICCOMPANYBOARDS

Current:

PerrigoCompanyPLC

PastFiveYears: ConagraBrands,Inc.

DEONM.STANDER

RECENTBUSINESSEXPERIENCE

AveryDennisonCorporation

•President&CEOsinceSeptember2023

•President&COOfromMarch2022to August2023

•VP/GM,RBIS(nowSolutionsGroup),from June2015toFebruary2022

•VP/GM,GlobalCommercialandInnovation, RBIS,fromJanuary2013toMay2015

•VP/GM,GlobalCommercial,RBIS,from October2010toDecember2012

BOARDROLES

FinanceCommitteeMember

OTHERPUBLICCOMPANYBOARDS

Current: None

PastFiveYears:

None

SELECTSKILLSANDQUALIFICATIONS

U.S.publiccompanyleadershipexperience

•Overseescompanywith$7+billionin revenuesand~24Kemployeesin2023

Industryandfunctionalexperience

•Asleaderofglobalglasscompany,brings packagingindustryexpertise,aswellas extensiveexperienceinmaterialsscienceand industrialgoods,ineachcasecomplementing ourMaterialsGroup

•Givenimpactofwasteandrecyclinginglass valuechain,technicalexpertisein environmentalsustainability,aswellas supervisoryexperienceinfinance,marketing, M&A,cybersecurityandR&DasCEO

Works/HasWorkedOutsidetheU.S.

•WorkassignmentsinLatinAmerica

SELECTSKILLSANDQUALIFICATIONS

U.S.publiccompanyboardexperience

•Concurrentserviceononeotherboardand priorserviceonotherboards

Industryexperience

•Technicalexpertiseinconsumergoods industryintowhichourSolutionsGroupsells with42+yearsinrolesofincreasing responsibility,aswellasextensive experienceinpackaging,focusedprimarilyon consumergoods

Functionalexperience

•Technicalexpertiseinmarketing,aswellas supervisoryexperienceinfinance,M&Aand R&DasregionalCEO

Works/HasWorkedOutsidetheU.S.

•WorkassignmentsinOceania

SELECTSKILLSANDQUALIFICATIONS

U.S.publiccompanyleadershipexperience

•Heldrolesofincreasingresponsibilityatour company,includingCOOandCEO

Industryexperience

•LedourSolutionsGroupbusinessand oversawourMaterialsGroupasCOO,with packagingindustryexpertiseandextensive experienceindigital,materialsscienceand industrialgoods

Functionalexperience

•Technicalenvironmentalsustainability expertisehavingledourenterprise SustainabilityCouncil,withsupervisory experienceinfinance,marketing,M&A, cybersecurityandR&DasCEO

Works/HasWorkedOutsidetheU.S.

•WorkassignmentsinEuropeandAsiaPacific

Age52

DirectorsinceFebruary2023

Independent

Age71

DirectorsinceJuly2007

Independent

Age60

DirectorsinceFebruary2024

Independent

FRANCESCAREVERBERI

RECENTBUSINESSEXPERIENCE

TrinseoPLC,aspecialtymaterialssolutionsprovider

•SVP,EngineeredMaterials&Chief SustainabilityOfficersinceAugust2023

•SVP,SustainablePlastics&Chief SustainabilityOfficerfromJuly2021toJuly 2023

•SVP,EngineeredMaterials&Synthetic Rubber,fromMarch2020toDecember2021

•GeneralManager,EngineeredMaterials,from October2019toMay2021

•GlobalSeniorBusinessDirector,Performance Plastics,fromDecember2017toOctober 2019

BOARDROLES

CompensationCommitteeMember

OTHERPUBLICCOMPANYBOARDS

Current:

None

PastFiveYears:

None

KENC.HICKS

RECENTBUSINESSEXPERIENCE

AcademySports+Outdoors,asportsand recreationretailer

•ExecutiveChairmansinceJune2023

•Chairman,President&CEOfromMay2018 toMay2023

FootLocker,Inc.,aspecialtyathleticretailer

•ExecutiveChairmanfromDecember2014to May2015

•Chairman,President&CEOfromFebruary 2010toNovember2014

•President&CEOfromAugust2009to February2010

BOARDROLES

CompensationCommitteeMember

OTHERPUBLICCOMPANYBOARDS

Current:

AcademySports+Outdoors

PastFiveYears:

None

MARIAFERNANDAMEJIA

RECENTBUSINESSEXPERIENCE

NewellBrandsInc.

•CEO,International,fromFebruary2022to February2023

KelloggCompany

•SVPandPresident,LatinAmerica,from November2011toFebruary2020

BOARDROLES

AuditCommitteeMember

OTHERPUBLICCOMPANYBOARDS

Current: None

PastFiveYears:

GroceryOutlet

SELECTSKILLSANDQUALIFICATIONS

Industryexperience

•Technicalmaterialsscienceexpertisefocused onappliedscienceinplastics,aswellas extensiveexperienceinindustrialgoods,in eachcasecomplementingourMaterials Group

Functionalexperience

•Servesasglobalsustainabilityleader,with technicalexpertiseinenvironmental sustainability

•Advancededucationalandprofessional engineeringexpertise,withsupervisory experienceinmarketingasdivisionalleader

Works/HasWorkedOutsidetheU.S.

•WorksinEurope,regionleading sustainability-relatedrequirements

SELECTSKILLSANDQUALIFICATIONS

U.S.publiccompanyleadershipexperience

•Ledcompanythenwith$6.4billionin annualrevenuesand~22Kemployees

U.S.publiccompanyboardexperience

•Priorserviceonotherboards

Industryexperience

•35+yearsofretailindustryexpertiseinto whichourSolutionsGroupsells,aswell asextensiveexperienceinconsumer goodsandpackagingindustries

Functionalexperience

•35+yearsoftechnicalmarketing expertise,includingrolesas merchandisingleaderattworetail companies,andsupervisoryexperiencein finance,M&A,environmental sustainabilityandcybersecurityasCEO

SELECTSKILLSANDQUALIFICATIONS

U.S.publiccompanyboardexperience

•Priorserviceonotherboards

Industryexperience

•35+yearsofconsumergoodsindustry expertiseintowhichourSolutionsGroup sells,aswellasextensiveexperiencein packaging,focusedprimarilyon consumergoods

Functionalexperience

•Technicalexpertiseinmarketing,aswell assupervisoryexperiencein environmentalsustainabilityandR&Das regionalCEO

Works/HasWorkedOutsidetheU.S.

•WorkassignmentsinLatinAmerica, EuropeandAsiaPacific

Age67

DirectorsinceFebruary2013

Independent

MARTHAN.SULLIVAN

RECENTBUSINESSEXPERIENCE

SensataTechnologiesHoldingPLC,asupplierof sensorsandcontrols

•President&CEOfromJanuary2013to March2020

•President&COOfromApril2010to December2012

•COOfromMay2006toApril2010

TexasInstruments,Inc.,Sensata’spredecessor entity

•VP,SensorProducts,from1997to2006

BOARDROLES

AuditCommitteeChair

OTHERPUBLICCOMPANYBOARDS

Current:

SensataTechnologiesHoldingPLC

PastFiveYears:

GoldmanSachsAcquisitionHoldingCompany CorpII

Age52

DirectorsinceApril2016

NotIndependent

SELECTSKILLSANDQUALIFICATIONS

U.S.publiccompanyleadershipexperience

•Ledcompanythenwith$3.5billioninannual revenuesand~21Kemployees

Industryexperience

•Industrialgoodsindustryexpertiseand extensivematerialsscienceexperience,in eachcasecomplementingourMaterials Group,aswellasextensiveexperiencein technologyfromoverseeingRFIDbusiness, complementingourSolutionsGroup

Functionalexperience

•Highereducationinengineeringand technicalexpertiseinR&D,aswellas supervisoryexperienceinfinance,marketing, M&Aandenvironmentalsustainabilityas CEO

MITCHELLR.BUTIER

RECENTBUSINESSEXPERIENCE

AveryDennisonCorporation

•ExecutiveChairmansinceSeptember2023

•Chairman&CEOfromMarch2022toAugust 2023

•Chairman,President&CEOfromApril2019 toFebruary2022

•President&CEOfromMay2016toApril 2019

•President&COOfromNovember2014to April2016

•SVP&CFOfromJune2010toOctober2014; continuedservingasCFOuntilMarch2015

•VP,GlobalFinance,&CAOfromMarch2007 toMay2010

BOARDROLES

ExecutiveChairman

FinanceCommitteeChair

OTHERPUBLICCOMPANYBOARDS

Current:

None

PastFiveYears: None

SELECTSKILLSANDQUALIFICATIONS

U.S.publiccompanyleadershipexperience

•Heldrolesofincreasingresponsibilityatour company,includingCFO,COOandCEO

Industryexperience

•Servedinpositionsofincreasing responsibilityinwhatisnowourMaterials Group,gainingpackagingindustryexpertise andextensivematerialsscienceand industrialgoodsexperience

Functionalexperience

•Technicalfinanceexpertisehavingservedas CAOandCFOandenvironmental sustainabilityexpertisefromadvancingour sustainabilitygoalsvalue-creation opportunities

•Supervisoryexperienceinmarketing,M&A, cybersecurityandR&DasCEO

Works/HasWorkedOutsidetheU.S.

•WorkassignmentsinEurope

Age68

DirectorsinceApril2005

Independent

PATRICKT.SIEWERT

RECENTBUSINESSEXPERIENCE

TheCarlyleGroup,adiversifiedinvestmentfirm

•RetiredManagingDirectorandPartnerand HeadofConsumer,MediaandRetail,Asia, fromApril2007toJune2023

TheCoca-ColaCompany,abeveragecompany

•ExecutiveCommitteememberandGroup President,Asia,fromAugust2001toMarch 2007

BOARDROLES

LeadIndependentDirector

GovernanceCommitteeChair

AuditCommitteeMember

FinanceCommitteeMember

OTHERPUBLICCOMPANYBOARDS

Current:

MondelēzInternational,Inc.

PastFiveYears: None

Age57

DirectorsinceOctober2022

Independent

SELECTSKILLSANDQUALIFICATIONS

U.S.publiccompanyboardexperience

•Concurrentserviceononeotherboard

Industryexperience

•Consumergoodsindustryexpertisehaving ledregionaldivisionofglobalbeverage companyintowhichourSolutionsGroupsells andextensiveexperienceinmaterialsscience andindustrialgoodsindustries, complementingourMaterialsGroup

Functionalexperience

•Financeand15+yearsofM&Aexpertise, advisingoninvestmentsinconsumergoods businessesandleadingconsumer,medial andretailinvestmentpracticesinAsiaPacific, aswellassupervisoryexperiencein marketingandR&DasregionalPresident

Works/HasWorkedOutsidetheU.S.

•25+yearsworkinginAsiaPacific

WILLIAMR.WAGNER

RECENTBUSINESSEXPERIENCE

GoToGroup,Inc.(formerlyLogMeIn,Inc.),a providerofsoftwareasaserviceandcloud-based remoteworktools

•President&CEOfromDecember2015to January2022

•President&COOfromJanuary2015to December2015

•COOfromMay2013toDecember2014

BOARDROLES

AuditCommitteeMember

GovernanceCommitteeMember

OTHERPUBLICCOMPANYBOARDS

Current:

BlackLine,Inc. AkamaiTechnologies,Inc. SemrushHoldings,Inc.

PastFiveYears: LogMeIn,Inc.

SELECTSKILLSANDQUALIFICATIONS

U.S.publiccompanyleadershipexperience

•Ledcompanythenwith$1+billioninannual revenuesand~4Kemployees

U.S.publiccompanyboardexperience

•Concurrentserviceonthreeotherboards

Industryexperience

•25+yearsofdigital/technologyindustry expertise,aswellasextensiveexperiencein technology-basedconsumergoods,ineach casecomplementingourSolutionsGroupand ourstrategytoleadattheintersectionofthe physicalanddigital

Functionalexperience

•Technicalcybersecurityexpertise,aswellas marketingexpertiseasfunctionalleaderat twotechnologycompanies;supervisory experienceinfinance,M&AandR&DasCEO

DIRECTORCOMPENSATION

Inrecommendingnon-employeedirectorcompensationtoourBoard,theCompensationCommitteeseeksto targetcompensationaroundthemedian ofsimilar-sizecompanieswithwhichwecompetefordirectortalent. The majorityofcompensationisdeliveredinequity toaligndirectorinterestswiththoseofourstockholders.

AnnualTargetCompensation

Thecomponentsofour2023non-employeedirectorcompensationprogramareshowninthechartsbelow.

2023NON-EMPLOYEEDIRECTORCOMPENSATION

*ThereiscurrentlynoadditionalFinanceCommitteeChairretainerbecauseourExecutiveChairmanisservinginthatcapacity.

Our2017IncentiveAwardPlanlimitsthesumofthegrantdatefairvalueofequityawardsandthecash compensationprovidedtonon-employeedirectorsduringanycalendaryearto$600,000.

CompensationSetting

Non-employeedirectorcompensationisreviewedbytheCompensationCommitteeeverythreeyears.InFebruary 2024,theCompensationCommittee’sindependentcompensationconsultantanalyzedtrendsinnon-employeedirector compensationandassessedourprogram’smarketcompetitiveness.

UsingbenchmarkdatafrompublicfilingsofcompaniesintheFortune350-500,WTWrecommendedthefollowing adjustmentstonon-employeedirectorcompensation:thetargetgrantdatefairvalueoftheannualRSUawardincrease by$15,000;theBoardretainerincreaseby$15,000;theadditionalretainerforourLeadIndependentDirectorincreaseby $15,000;andtheadditionalretainersforourAudit,CompensationandGovernanceCommitteeChairsincreaseby $10,000,$5,000and$5,000,respectively.Thesemodestincreaseswouldbringtotaldirectcompensationforregular Boardserviceto$300,000(or$310,000withthecharitablematch),theprojectedmedianofFortune350-500companies in2027,thenexttimetheCompensationCommitteeplanstoreviewtheprogram.Givingconsiderationtotheadviceof WTW,theCompensationCommitteerecommendedtoourBoardthatthetargetgrantdatefairvalueoftheannualaward ofRSUsbeincreasedto$185,000;theBoardretainerbeincreasedto$115,000;theadditionalretainerofourLead IndependentDirectorbeincreasedto$45,000;andtheadditionalretainersforourAudit,CompensationandGovernance CommitteeChairsbeincreasedto$35,000,$25,000and$25,000,respectively.

UpontherecommendationoftheCompensationCommittee,ourBoardapprovedtherevisednon-employeedirector compensationprogram,effectiveasofthedateoftheAnnualMeeting.

StockOwnershipPolicy

Ourstockownershippolicyrequiresnon-employeedirectorstoownatleast$500,000ofourcompanystock,50%of whichmustbeheldinvestedshares.Onlysharesowneddirectlyorinatrust,DSUsandunvestedRSUssubjecttotimebasedvestingaremeasuredtodeterminepolicycompliance.

Allofournon-employeedirectorshaveachievedtheminimumownershiprequiredbyourstockownershippolicy otherthanMr.WagnerandMses.ReverberiandMejiawhohavefiveyearsfromthedateoftheirrespectiveBoard appointmenttoachievethatlevel. Theaverageownershipofallotherthen-servingnon-employeedirectorswas 12xtheminimumownershiprequirementatyear-end2023

EquityCompensation

Theannualequityawardtonon-employeedirectorsconsistsofRSUsthatvestontheone-yearanniversaryofthe grantdate,consistentwiththeone-yeartermtowhichdirectorsareelected.UnvestedRSUs(i)fullyvestuponadirector’s death,disability,retirementfromourBoardafterreachingage72orterminationofservicewithin24monthsaftera changeofcontroland(ii)arecancelledintheeventadirectorisnotreelectedbystockholdersorleavesourBoardbefore vesting,unlessotherwisedeterminedbytheCompensationCommittee.OnMay1,2023,eachofourthen-serving non-employeedirectorswasawarded971RSUswithagrantdatefairvalueof$166,978.

OnFebruary23,2023,inconnectionwithherappointmenttoourBoard,Ms.Reverberireceivedanawardof155 RSUswithagrantdatefairvalueof$27,817,reflectingtheannualequityawardof$170,000proratedfortheremaining twomonthsofthetermendingatthe2023AnnualMeeting.

FollowinghisdeparturefromourBoardinNovember2023andaspermittedbyour2017IncentiveAwardPlan,the CompensationCommitteedeterminedtoacceleratethevestingoftheRSUsgrantedtoMr.AndersononMay1,2023in recognitionofhisdecade-plusserviceonourBoard.

DeferrableCashCompensation

Annualretainersarepaidsemiannuallyandproratedforanydirector’spartialserviceduringtheyear.Our non-employeedirectorsmayelecttoreceivethiscompensationin(i)cash,eitherpaiddirectlyordeferredintoanaccount underourDirectorsVariableDeferredCompensationProgram(DVDCP),whichaccruesearningsattherateofreturnof certainbondandequityinvestmentfundsmanagedbyathirdparty;(ii)DSUscreditedtoanindividualaccountpursuant toourDirectorsDeferredEquityCompensationProgram(DDECP);or(iii)acombinationofcashandDSUs.In2023,none ofourthen-servingnon-employeedirectorsparticipatedintheDVDCPandfourofthemparticipatedintheDDECP. Dividendequivalents,representingthevalueofdividendspaidonsharesofourcommonstockcalculatedbasedonthe numberofDSUsheldasofadividendrecorddate,arereinvestedontheapplicablepayabledateintheformofadditional DSUs.

WhenaparticipantintheDDECPceasesservingasadirector,thedollarvalueoftheDSUsinhisorheraccountis dividedbytheclosingpriceofourcommonstockonthelastdateofthedirector’sservice,withtheresultingnumberof sharesofourcommonstock,lessfractionalshares,issuedtothedirector.InconnectionwithhisdeparturefromourBoard effectiveNovember30,2023,Mr.Andersonwasissued13,102sharesofourcommonstockreflectinghisDDECP accountbalanceonthatdate.

CharitableMatch

Wematchupto$10,000peryearofeachnon-employeedirector’sdocumentedcontributionstocharitable organizationsoreducationalinstitutions.

DIRECTORCOMPENSATIONTABLE

BradleyA.Alford

AnthonyA.Anderson(2)

KenC.Hicks $100,000$166,978$10,000$276,978

AndresA.Lopez $100,000$166,978—$266,978

FrancescaReverberi

PatrickT.Siewert $150,000$166,978$10,000$326,978

JuliaA.Stewart $120,000$166,978$10,000$296,978

MarthaN.Sullivan $125,000$166,978$10,000$301,978

WilliamR.Wagner $100,000$166,978$10,000$276,978

(1) Messrs.ButierandStanderdonotappearinthetablebecausetheyserveasExecutiveChairmanandCEOofourcompany,respectively,andreceivenoadditional compensationtoserveonourBoard.Ms.Mejiadoesnotappearonthetablebecauseshewasnotadirectorduring2023.

(2) Amountsrepresentretainersearnedasshowninthetablebelow.Attheirelection,thefollowingdirectorshad,foroneormoreyearsduringtheirservice,deferred compensationthroughtheDDECP,withthefollowingnumberofDSUsintheiraccountsasofDecember30,2023,thelastdayofour2023fiscalyear:Mr.Alford –22,398;Mr.Hicks–15,330;Mr.Lopez–1,649;Ms.Stewart–43,303;andMs.Sullivan–13,864.FollowinghisdeparturefromourBoardinNovember2023, Mr.Andersonwasissued13,102sharesofourcommonstockreflectinghisDDECPaccountbalance,lessfractionalshares,onhisseparationdate.

(3) AmountsreflectthegrantdatefairvaluesofRSUsinaccordancewithAccountingStandardsCodificationTopic718,Compensation,StockCompensation(ASC 718).Fairvaluesweredeterminedbasedonthefairmarketvalueofourcommonstockontherespectivegrantdate,adjustedforforegonedividends.Each non-employeedirectorservingatyear-end2023held971unvestedRSUs,exceptthatMs.Reverberiheld1,126unvestedRSUs.

(4) Amountsreflectourmatchofdocumentedcontributionsmadetocharitableorganizationsoreducationalinstitutions.

ITEM2—ADVISORYVOTETOAPPROVEEXECUTIVECOMPENSATION

Afterconsideringthepreliminaryvotingresultsoftheadvisoryvoteonthefrequencyofsay-on-payvotesatthe 2023AnnualMeeting,ourBoarddeterminedtocontinueholdingsay-on-payvotesannually.Theadvisoryvoteisavote toapprovethecompensationofourNEOs,asdescribedinthe CompensationDiscussionandAnalysis and Executive CompensationTables sectionsofthisproxystatement.Itisnotavoteonourgeneralcompensationpoliciesorany specificelementofcompensation,thecompensationofournon-employeedirectors,ourCEOpayratioorpayvs. performancedisclosures,orthefeaturesofourcompensationprogramthatmitigateexcessiverisk-taking.

TheresultsoftheadvisoryvotearenotbindingonourBoard.However,consistentwithitshistoricalpractice,the CompensationCommitteewilldiscloseitsconsiderationofthevoteresultsinthe CompensationDiscussionandAnalysis sectionofour2025proxystatement.

BoardRecommendation

Wearecommittedtomaintainingongoingengagementwithourinvestorstodiscussthealignmentofourexecutive compensationprogramwithourstrategiesandtheincentivesitprovidesourleaderstodeliverstrongfinancial performanceandcontinuoussustainabilityprogress,creatingsuperiorlong-term,sustainablevalueforourcustomers, investors,employeesandcommunities.

OurBoardrecommendsthatyouvoteFORapproval,onanadvisorybasis,ofourexecutivecompensation.

Properlydatedandsignedproxieswillbesovotedunlessyouspecifyotherwise.

COMPENSATIONDISCUSSIONANDANALYSIS(CD&A)

ThisCD&A*describesourexecutivecompensationprogramandthedecisionsoftheCompensationCommittee (referredtointhisCD&Aasthe“Committee”)regarding2023executivecompensation.Itincludesthesectionsshown below.

EXECUTIVESUMMARY

Ourstrategicpillarsandrelated2023achievementsaredescribedintheproxysummary. Wehaveconsistently executedourbusinessstrategies,deliveringlong-term,sustainablevalueforourinvestors. Webelievethatthisvalue isbestmeasuredbyourTSRandcumulativeEVA,bothofwhichareperformanceobjectivesusedinourLTIprogramand informhowwesetourgoalsforsalesgrowth,operatingmarginimprovement,assetefficiency,ROTCandcapital allocation.

Highlightsofourfinancialperformanceareshownbelow.Ouroverridingfocusremainsonensuringthelong-term successofourstakeholders,and,asdescribedintheproxysummary,wehaveaclearsetofstrategiestodeliverforthem.

ProgressToward2025FinancialTargets

InMarch2021,weannouncedfinancialtargetsthrough2025.Giventhechallengesweexperiencedin2023,our progresstowardtheselong-termtargetsslowedduringtheyear;however,weexpectsignificantprogressin2024as labelandapparelmarketsreboundandgrowthinourIntelligentLabelsbusinessaccelerates.

*ThisCD&Acontains“forward-lookingstatements”withinthemeaningofthePrivateSecuritiesLitigationReformActof1995.Theseforward-lookingstatementsare subjecttocertainrisksanduncertainties,whichcouldcauseactualresultstodiffermateriallyfromtheexpectedresults,performanceorachievementsexpressedor impliedthereby.Foradetaileddiscussionoftheserisks,seePartI,Item1a,“RiskFactors”andPartII,Item7,“Management’sDiscussionandAnalysisofFinancial ConditionandResultsofOperations,”inour2023AnnualReport.StatementscontainedinthisCD&Aregardingourcompanyandbusinessperformancetargetsand goalsshouldnotbeinterpretedasmanagement’sexpectations,estimatesoffutureresultsorotherguidance.

In2021-2023,onathree-yearcompoundannualbasis(with2020asthebaseperiod),GAAPreportednetsales increasedby6.3%,whileGAAPoperatingincome,netincomeandEPSdecreasedby1.1%,3.3%and2.1%,respectively. GAAPreportedoperatingmarginin2023was9.4%.

(1) Resultsfornon-GAAPmeasuresarereconciledfromGAAPinAppendixAofthisproxystatement.

(2) Percentagesfortargetsreflectfive-yearcompoundannualgrowthrates,with2020asthebaseperiod. Percentagesforresultsreflectthree-yearcompoundannualgrowthrates,with2020asthebaseperiod.

(3) AlthoughadjustedEBITDAgrowthwasnotoneofouroriginalfinancialtargets,itwasimpliedbyoursales changeex.currencyandadjustedEBITDAmargintargets.Theforeigncurrencytranslationimpactto EBITDAwasabenefitofapproximately$38millionin2021andaheadwindofapproximately$81million and$20millionin2022and2023,respectively.

2023FinancialPerformance

Althoughalowerdemandenvironmentdrivenprimarilybyinventorydestockingdownstreamfromourcompany resultedinachallengingyearinwhichwedidnotrealizeourannualperformanceexpectations,wedeliveredsequential improvementeachquarterandcontinuedadvancementinkeygrowthareassuchasIntelligentLabels.Keyfinancial resultsfortheyearareshownbelow.

2023FINANCIALRESULTS

$6.20 $826.0M $503.0M

Reportednetsales decreasedby7.5%from $9.0billionin2022, reflectinglowervolume primarilyasaresultof inventorydestocking;sales ex.currencydeclinedby 6.9%

EffectiveCapitalAllocation

ReportedEPSdecreased from$9.21in2022; adjustedEPSdecreased from$9.15in2022to $7.90,primarilyreflecting lowervolume,partially offsetbyproductivityand restructuringactions

Weusedadjustedfree cashflowof $591.9milliontoacquire threecompanies,make oneventureinvestment, paydividendsof$256+ millionandrepurchase $137+millioninsharesof ourcommonstock

DeliveredROTCof12.4%

Wehaveinvestedinourbusinessestosupportorganicgrowthandacquiredcompaniesthatexpandourcapabilities inhigh-valueproductcategories,increaseourpaceofinnovationandadvanceoursustainabilitypriorities.Ourfixedand ITcapitalspendingin2023of$285.1millionwascomparableto2022,reflectingourcontinuedinvestmentinhigh-value categories,particularlyourIntelligentLabelsbusiness.Duringtheyear,weacquiredThermopatch,LionBrothersand SilverCrystal;together,theseacquisitionsexpandtheexternalembellishmentsportfolioinourSolutionsGroup.Wealso madeoneventureinvestmentinacompanydevelopingtechnologicalsolutionsthatwebelievehavethepotentialto advanceourstrategies.

In2023,wepaid$256.7millionindividendsof$3.18pershareandrepurchased0.8millionsharesofourcommon stock. Weraisedourquarterlydividendrateby~8%inApril2023.

Asshownbelow, overthelastfiveyears,wehavedeployedover$2billiontoacquisitions(includingventure investments)andreturnedover$2billiontostockholdersindividendsandsharerepurchases

Longer-TermTSROutperformance

AlthoughourTSRin2023wasmodestlybelowtheTSRoftheS&P500IndexandtheS&P500IndustrialsIndexand modestlyabovetheDowJonesU.S.Container&PackagingIndex, ourfive-yearcumulativeTSRsignificantly outperformedallthreeofthesecomparatorgroups.

1-,3-AND5-YEARTSR

2023Say-on-PayVoteandFeedbackDuringStockholderEngagement

Atthe2023AnnualMeeting,~93%ofourstockholdersapprovedourexecutivecompensation.Thelevelofsupport wereceivedwasrelativelyconsistentwiththehighapprovalrateswereceivedinrecentyears. TheCommitteebelieves thatourstrongsay-on-payvoteresults,aswellasthefeedbackrelatedtoourexecutivecompensationprogramwe havereceivedduringourengagementswithinvestors,demonstrateoverallsupportofourprogram.

TheCommitteemakeschangestoourexecutivecompensationprogramasappropriatetoensureitalignswithour evolvingfinancialprofile,businessstrategiesandsustainabilityprioritiesoraddressfeedbackfromourinvestors.We believethatthisongoingreviewandtheactionstakenovertimedemonstratetheCommittee’scommitmenttopayingfor performanceandbeingresponsivetoinvestorfeedback.

2023NEOs

InthisCD&Aandthe ExecutiveCompensationTables sectionofthisproxystatement,weprovidecompensation informationforour2023NEOsshownbelow.

LeadershipTransition

Asdiscussedintheproxysummary,ourBoardexecutedawell-developedCEOsuccessionplanningprocessinMay 2023,appointingMr.StanderasPresident/CEOandMr.ButierasExecutiveChairman,ineachcaseeffective September1,2023.

Inconnectionwiththeirtransitiontotheseroles,givingconsiderationtotheadviceofitsindependentcompensation consultant,WTW,theCommitteemadethedecisionsdescribedbelowrelatedtotheircompensation. Giventhetimingof theCEOtransition,thecompensationofMessrs.StanderandButierfor2023largelyreflectedtheircompensationas President/COOandCEO,respectively.

•ForMr.Stander,increasedhisannualbasesalaryfrom$700,000to$1.1millionandhistargetAIPopportunityfrom 75%to135%ofbasesalary,ineachcaseeffectiveSeptember1,2023(withhis2023AIPawardtobeprorated basedontheportionoftheyearinwhichheservedasCOOandtheportionoftheyearinwhichheservedasCEO). TheCompensationCommitteepreliminarilyalignedtoincreasehistargetLTIopportunityfrom300%to550%of basesalary,effectivewiththeannualLTIawardonMarch1,2024,subjecttoitsreviewofmarketpayforsimilarroles atthattime.Inaddition,theCommitteeapprovedaspecialpromotionawardtoMr.StanderonSeptember1,2023of stockoptionswithagrantdatefairvalueofapproximately$3million,50%ofwhichvestsoneachofthethirdand fourthanniversariesofthegrantdate,subjecttohiscontinuedservice.Mr.Stander’sannualizedtargetTDCof $8.6million(excludingthespecialpromotionaward)was setlessthanthemarketmedian;theCommitteebelieved thatpositioninghiscompensationatthemarket40th percentilecompensatedhimwithinareasonableCEOmarket rangebutreflectedthathewasnewtotheCEOrole.

54 2024ProxyStatement | AveryDennisonCorporation

•ForMr.Butier,reducedhisannualbasesalaryfrom$1.3millionto$1millionandhistargetAIPopportunityfrom 160%to120%ofbasesalary,ineachcaseeffectiveSeptember1,2023(withhis2023AIPawardtobeprorated basedontheportionoftheyearinwhichheservedasCEOandtheportionoftheyearinwhichheservedas ExecutiveChairman).HereceivednospecialLTIawardinconnectionwithhisrolechange.TheCommitteeset Mr.Butier’sannualizedtargetTDCconsistentwiththemarketmedianforanexecutivechairmanrole,reflectingthe mentorshipandguidancehewouldbeprovidingtohelpensureasmoothCEOtransition.

OverviewofPayPhilosophyandExecutiveCompensationComponents

OurexecutivecompensationprogramreflectstheCommittee’sphilosophythatasubstantialmajorityof compensationshouldbetiedtooursuccessinachievingourfinancialobjectivesandcreatingstockholdervalue,providing higherrealizedcompensationwhenwedeliversuperior,sustainedperformance.Theobjectivesofthisstrategyareto motivateourexecutivestoachieveourannualandlong-termfinancialgoals.

TheCommitteeimplementsitspay-for-performancephilosophyasfollows:

•EstablishingtargetTDCtoincentstrongoperationalandfinancialperformanceandstockholdervaluecreation, givingconsiderationtomedianpayatsimilar-sizecompanies,roleresponsibilities,individualperformance, tenure,retentionandsuccession

•Aligningannualincentivesforexecutiveswithourfinancialgoalsfortheyear

•Rewardinglong-termperformanceusingabsoluteandrelativeTSR,aswellascumulativeEVA,tofocusour executivesondeliveringsustainablestockholdervaluecreation

ThesubstantialmajorityoftargetTDCisperformance-based,meaningthatourNEOsultimatelymaynotrealize thevalueofat-riskcomponentsifwefailtoachievethedesignatedperformanceobjectives. Incentivecompensation consistsoftargetawardopportunitiesunderourAIPandourLTIcompensationprogram,withpayoutsdeterminedbased onourperformanceagainstthethreshold,targetandmaximumlevelsestablishedbytheCommittee.TheCommittee structuresannualincentivecompensationtorewardNEOsprimarilybasedoncompanyorbusinessperformancetoalign theircompensationwithstockholderinterests.ThemixandelementsofNEOtargetTDCareshownbelow.

*Mr.Stander’sannualizedtargetTDCreflectshiscompensationpackageasCEO,excludinghisspecialpromotionawardofstockoptionswitha grantdatefairvalueofapproximately$3million.

**Mr.Butierisexcludedbecausehistarget2023TDCprimarilyreflectedhiscompensationasCEOgiventhetimingofourleadershiptransition. Mr.Melo’stargetTDCmixincludedintheaveragereflectshistargetTDCasPresident,SolutionsGroup.

ELEMENTSOFNEOTARGETTDC

LTICompensation

CorporateNEOs

PUs

Performance-Based

MSUs

BaseSalary

•50%ofLTIwithpayout= 0%to200%oftargetaward

•3-yearperformanceperiod

-CompanyEVA(50%)

-CompanyRelativeTSR(50%)

SolutionsNEO

•50%ofLTIwithpayout= 0%to200%oftargetaward

•3-yearperformanceperiod

-SolutionsGroupEVA(75%)

-CompanyRelativeTSR(25%)

•RelativeTSRpayoutcappedat100%ifabsoluteTSRisnegative

•50%ofLTIwithpayout=0%to200%oftargetaward •100%AbsoluteTSR(3)

•1-,2-,3-and4-yearperformanceperiods

AnnualIncentiveCompensation

•Drivesperformanceconsistentwithannualcompanyorbusinessfinancialgoals

•Individualperformancemodifierbasedonachievementagainstpredetermined strategicandsustainabilityobjectives(generallycappedat100%forNEOs)

•Annualfixed-cashcompensationgenerallysetaroundmarketmedian

*AIPawardforSolutionsNEO(Mr.Melo)reflectshisperformanceobjectivesandweightingsfortheninemonthsoftheyearheservedas President,SolutionsGroup.HehaddifferentperformanceobjectivesandweightingsforthethreemonthsoftheyearheservedasSVP/GM, AveryDennisonSmartrac.His2023AIPawardwouldhavebeenproratedtoreflecttherespectiveperformanceobjectivesandweightingshad notthepayoutbeenzero.

Inthegraphbelow,CEOcompensationfor2019through2022reflectsMr.Butier’scompensationasreportedinour SummaryCompensationTablesforthoseyearsand,for2023,Mr.Stander’scompensationasreportedinour2023 SummaryCompensationTable.OurCEOpayhasgenerallyreflectedourcumulativeTSRexceptthatMr.Stander’spayin 2023wassubstantiallylowerthanprior-yearamountsforMr.Butierbecauseitprimarilyreflectedhiscompensationas COO,whichwassignificantlylowerthanMr.Butier’sasCEO,aswellashisspecialawardofstockoptionswithagrant datefairvalueofapproximately$3milliongrantedinconnectionwithhispromotiontoCEO.

StrongCompensationGovernancePractices

Ourexecutivecompensationprogramincorporatesthebestpracticesshownbelow,whichtheCommitteebelieves ensurethatitservesthelong-terminterestsofourstockholders.

PAYFORPERFORMANCE

CompensationPrimarily Performance-Based ✓ 87%ofCEO’sannualizedtargetTDCand69%ofaverage2023targetTDCofotherNEOs(excluding Mr.Butier)

CappedAnnualIncentive SetConsideringGuidance andLong-TermTargets

MajorityLong-TermEquity IncentiveCompensation

StrategicTargeting

✓ AIPawardbasedonachievingadjustedEPSatorabovemidpointofannualguidanceandotherperformance objectivesconsistentwithannualfinancialgoals,subjecttolimitedupwardandunlimiteddownward discretionbasedonCommittee’sassessmentofperformanceofourCEOagainstpredeterminedstrategic objectivesandotherNEOs’individualcontributions;awardscappedat200%oftargetandindividualmodifiers forNEOsgenerallycappedat100%

✓ LTIawardsprioritizelonger-termstockholdervaluecreation,withPUscliff-vestingatendof3-yearperiod andMSUsvestingover1-,2-,3-and4-yearperformanceperiods

✓ TargetTDC(basesalary+targetAIPopportunity+targetLTIopportunity)settoincentstrongperformance andvaluecreation,givingconsiderationtopayatsimilar-sizecompanies,roleresponsibilities,performance, tenure,retentionandsuccession

COMPENSATIONBESTPRACTICES

NoEmploymentContracts ✓ NEOsemployedwithoutcontractunlessrequiredbyapplicablelawsintheirhomecountry

RigorousStock OwnershipPolicy

✓ CEOrequiredtomaintainownershipof6xhisbasesalaryandowned10xthisrequirementatYE2023; ExecutiveChairman,Level2NEOsandLevel3NEOsrequiredtomaintainownership6x,3xand2xofbase salary,respectively

NoHedgingorPledging ✓ Insidertradingpolicyprohibitsofficersfromengaginginshortsale,option,hedgingandpledgingtransactions inourcommonstockandallNEOscompliedduring2023

LimitedTradingWindows ✓ NEOsmayonlytransactincompanystockduringapprovedtradingwindowsaftersatisfyingpreclearance requirements,includingcertifyingcontinuedcompliancewithourstockownershippolicy

MedianBurnRate ✓ Three-yearaverageburnrateof0.50%atYE2023,inlinewith50thpercentileofS&P500companies

CompensationClawbacks ✓ Incentivecompensationdeterminedtobeerroneouslyreceivedbyexecutiveofficerssubjecttoclawbackin eventofaccountingrestatement

NoExciseTaxGrossUps ✓ Nogross-uppaymentsforexcisetaxesforterminationfollowingchangeofcontrol

DoubleTrigger EquityVesting

✓ Equityawardsnotaccelerateduponchangeofcontrolunlessterminatedwithoutcauseorterminate employmentforgoodreasonwithin24monthsofchangeofcontrol

LimitedPerquisites ✓ OtherthancappedfinancialplanningreimbursementonlyforCEOandLevel2NEOsandpaymentforannual physicalexaminations,U.S.NEOsreceiveflattaxableexecutivebenefitallowancenotsubjecttotaxgross-up

Reasonable SeveranceBenefits

Limited ChangeofControl

Benefits

✓ Severanceforqualifyingtermination:

CEO:2x(annualsalary+targetAIPawardforyearoftermination+cashvalueofannualhealthinsurance premium) AllotherNEOs(excl.Mr.Butier):1x(annualsalary+targetAIPawardforyearoftermination+cashvalueof annualhealthinsurancepremium)

✓ Enhancedseveranceforqualifyingterminationwithin24monthsfollowingachangeofcontrol: CEO:3x(annualsalary+targetAIPawardforyearoftermination+cashvalueofannualhealthinsurance premium)+proratedtargetAIPawardforyearoftermination

Level2NEOsonly:2x(annualsalary+targetAIPawardforyearoftermination+cashvalueofannualhealth insurancepremium)+proratedtargetAIPawardforyearoftermination

STRONGGOVERNANCE

IndependentOversight ✓ Committeecomprisingindependentdirectorswithexecutivecompensationdecisions

ExpertCompensation

Consultant ✓ WTWprovidesCommitteewithexpertexecutivecompensationadvice

IntegrationofSustainabilityProgressTiedtoStrategy

Inrecentyears,theCommitteehasengagedindiscussionswithitscompensationconsultant,WTW,and managementandreviewedmarketpracticesregardingtheintegrationofoursustainabilityprogressintoourexecutive compensationprogram.TheCommitteenotedthatoneofourstrategicpillarsisleadinginanenvironmentallyandsocially responsiblemanner,anditsaimistoapproveexecutivecompensationthatreflectsourstrategiesandincents achievementofcompanygoals.

TheCommitteehasdeterminedthatourexecutivecompensationprogramholdsourleadersaccountableandrewards theirdeliveryofsustainability-relatedresults.TheCommitteehasnoted,amongotherthings,thefactorsdescribedbelow.

•Approximately one-quarterofthemeasuresonour2023businessgroupscorecardsrelatedtosustainability, incentingourleaderstoachievetheseobjectivesandprovidingvisibilityandaccountabilitytoensurecontinuous advancement.Thesescorecardshelpsurfaceunderperformingprogressandofferanassessmenttoolin year-endperformancediscussions.

•Our seniorleadership,includingourNEOsandVicePresidents,isaccountablefordrivingoursustainability progress. Inmakingtheircompensationdecisions,managersconsidernotonlyfinancialorbusiness achievements,butalsoanindividual’ssuccessinadvancingoursustainabilitygoals,consistentwithour company’svaluesandstrategies.

•AlthoughtheAIPfinancialmodifierdoesnotincludequantitativesustainability-relatedmeasures, ourfinancial performanceinpartreflectsthesuccessofoursustainability-drivenproductsandsolutions.Inaddition,a componentindetermininganAIPawardistheindividualmodifier,whichreflectsaqualitativeassessmentof overallperformance,includingsustainability-relatedachievements,andcanincreaseordecreaseanexecutive’s AIPaward.

• DiversityandSustainabilityaretwoofourcompany’svalues. OurannualLeadershipExcellenceAwardsare grantedtoindividualsandteamsgloballyineachofthesecategories,withrecipientsgenerallyreceivingatleast a120%individualmodifierontheirAIPaward.In2023,38employeesreceivedawardsforeitherdiversityor sustainability,with17additionalindividualsrecognizedfortheirworkintheircommunities.

TheCommitteerecognizesthatoursustainabilityprogresshashelpedusdeliverfinancialsuccessinrecentyears. We haveconsistentlyinnovatedmoresustainablesolutions,whichhaveprovidedsignificantcompetitiveadvantage, helpingdriveoursuccessinthemarketplaceanddeliverforourstakeholders.

TheCommitteehascommittedtoregularlyreviewingevolvingstakeholderexpectationsandmarketpractices,and reevaluatingthecontinuedappropriatenessofitsapproachtotheintegrationofsustainabilityprogressinexecutive compensation.ReviewingbenchmarkdataonmarketpracticeswithmanagementandWTW,theCommitteeobserved thatthemajorityofS&P500companiesreportconsideringsustainabilityperformanceintheirexecutivecompensation programs,withmostdoingsosimilarlytothewaywedo. In2023,duringitsdiscussionofthefeedbackfromour2023 stockholderengagements,theCommitteealignedtomaintainitsapproachtotheconsiderationofsustainability mattersinsettingandapprovingexecutivecompensation,notingthatcertaininvestorshadadvisedcautionin incorporatingquantitativesustainabilitytargets,whichcanbedifficulttoobjectivelymeasure.

SUMMARYOF2023COMPENSATIONDECISIONS

TheCommitteeapprovesexecutivecompensationtopayforperformance,withthetargetTDCofNEOsestablished toincentstrongfinancialperformanceandstockholdervaluecreation.Compensationispredominantlyperformance based,meaningthatourexecutivesmaynotultimatelyrealizesomeoralloftheat-riskcomponentsifwefailtoachieve ourfinancialobjectives.

Indetermining2023NEOcompensation,theCommitteeconsideredthefactorsdescribedbelow.

• AnnualCompanyPerformance –ForCorporateNEOs,ourcompany’s2023adjustedsalesgrowth,adjustedEPS andadjustedfreecashflow;forourSolutionsNEO,primarilytheadjustednetincomeandadjustedfreecash flowofhisbusinessandsecondarilyadjustedEPS

• StockholderReturns –OurTSRonanabsolutebasis,aswellasrelativetoadesignatedgroupofpeer companies

• IndividualPerformance –OurCEO’sperformanceagainstthepredeterminedstrategicobjectivesestablishedfor himatthebeginningoftheyearandtheindividualcontributionsofourotherNEOs

• MarketCompetitiveness –Paypracticesandcompanyperformancerelativetothemarket

• InvestorFeedback –Theresultsofour2023say-on-payvoteandthefeedbackonexecutivecompensation receivedduringourstockholderengagementprogram

Thekeyelementsof2023NEOtargetTDCaredescribedinthetableshownbelow. Whileweprovideconsistent, market-competitivetargetTDCopportunitiesforourNEOs,theactualcompensationtheyrealizeeachyearvaries basedonourfinancialperformance.

2023EXECUTIVECOMPENSATIONSUMMARY

Component DecisionsImpacting2023Compensation

BASESALARY

13%ofannualizedCEOTDC; Avg.31%of2023TDCfor OtherNEOs(excl.Butier)

TARGETAIPAWARD

17%ofannualizedCEOTDC; Avg.19%of2023TDCfor OtherNEOs(excl.Butier)

EffectiveApril2023,Mr.Butierreceivedabasesalaryincreaseof~8%andMs.Baker-NelandMessrs. StanderandLovinseachreceivedbasesalaryincreasesof~7%,ineachcasetomorecloselyalignthem withmarketdataforsimilarroles;Mr.Colistoreceivedabasesalaryincreaseof3.5%consistentwiththe averageincreaseforourU.S.employees.Basedontheirpreviouslyincreasedbasesalaries(asapplicable), Mr.Melo’sbasesalaryincreasedby~19%whenhebecameSolutionsPresidenteffectiveApril2023,and Mr.Stander’sbasesalaryincreasedby~47%whenhebecameCEOandMr.Butier’sbasesalary decreasedby~23%whenhebecameExecutiveChairman,ineachcaseeffectiveSeptember2023.

ThefollowingNEOtargetAIPopportunitieschangedduetopromotion:Mr.Melo’sincreasedfrom 50%to60%ofbasesalarywhenhebecameSolutionsPresident,effectiveApril2023,and Mr.Stander’sincreasedfrom75%to135%ofbasesalarywhenhebecameCEO,effective September2023.WhenhewasCEO,Mr.Butier’s2023targetAIPopportunityincreasedfrom 140%to160%ofbasesalarytopositionhispayatthe70th percentileofmarketdatafor companieswithannualrevenuesof$10billion,acknowledginghisstrongperformancedelivering top-quartileTSRandmitigatingthechancethathistargetTDCwouldfallbelowthemarketmedian before2026,thenexttimetheCommitteeplannedtoreviewhiscompensation,consistentwithits approachofdoingsoeverythreeyears.AlthoughourCEOtransitionoccurredlaterin2023,atthe timeofapprovaltheCommitteewasfocusedonappropriatelycompensatingMr.Butierasalongserving,highlysuccessfulCEO.Mr.Butier’stargetAIPopportunitysubsequentlydecreasedfrom 160%to120%ofbasesalarywhenhebecameExecutiveChairman,effectiveSeptember2023. The2023AIPawardsforMessrs.Stander,ButierandMelowouldhavebeenproratedbasedon theirpreviousopportunitiesof75%,160%and50%ofbasesalary,respectively,andtheirfiscal year-endopportunitiesof135%,120%and60%ofbasesalary,respectively,hadthepayoutsnot beenzero.

Companyand/orSolutionsperformanceresultedinfinancialmodifiersof0%forallNEOs.Individual modifiersforallNEOs,whichhadnoimpactonAIPpayoutsgiventhe0%financialmodifiers,were100%. NoneofourNEOsreceivedanAIPawardfor2023.

2023EXECUTIVECOMPENSATIONSUMMARY

Component DecisionsImpacting2023Compensation

TARGETLTIAWARD (50%PUs,50%MSUs)

70%ofCEOannualizedTDC; Avg.50%of2023TDCfor OtherNEOs(excl.Butier)

AnnualLTIAwardsGrantedin2023

•WhenhewasCEO,Mr.Butier’s2023targetLTIopportunityincreasedfrom585%to700%ofbase salarytopositionhispayatthe70th percentileofmarketdataforcompanieswithannualrevenuesof $10billion,acknowledginghisstrongperformancedeliveringtop-quartileTSRandmitigatingthe chancethathistargetTDCwouldfallbelowthemarketmedianbefore2026,thenexttimethe Committeeplannedtoreviewhiscompensation,consistentwithitsapproachofdoingsoeverythree years.AlthoughourCEOtransitionoccurredlaterin2023,atthetimeofapprovaltheCommittee wasfocusedonappropriatelycompensatingMr.Butierasalong-serving,highlysuccessfulCEO. Mr.Butier’stargetLTIopportunityasExecutiveChairmanhadnotbeendeterminedatthetimeofhis rolechange.InconnectionwithhispromotiontoSolutionsPresident,Mr.Melo’stargetLTI opportunityincreasedfrom120%to180%ofbasesalaryeffectiveMarch2023.TheCommittee preliminarilyalignedtoincreaseMr.Stander’stargetLTIopportunityfrom300%to550%ofbase salary,effectiveMarch2024,subjecttoitsreviewofmarketpayforsimilarrolesatthattime.There werenootherchangestoNEOtargetLTIopportunitiesin2023.

•50%inPUsthatcliff-vestattheendofthree-yearperiodwithpayoutsrangingfromzeroto200% basedontheachievementoftherespectivecumulativeEVAandrelativeTSRperformance objectives.PayoutfortheTSRcomponentiscappedat100%oftargetforanythree-year performanceperiodinwhichabsoluteTSRisnegative.TherewerenochangestothePU performanceobjectivesorweightingsforCorporateNEOsin2023.

•50%inMSUsthatvestbasedonabsoluteTSRover1-,2-,3-and4-yearperformanceperiods,with anaverageperformanceperiodof2.5years,basedonthefollowingperformancelevelsandcriteria:

(i)thresholdperformancelevel,whichresultsinpayoutatvestingof85%,isTSRof(15)%;(ii)target performancelevel,whichresultsinapayoutatvestingof100%,requiresTSRof10%;and (iii)maximumperformancelevel,whichresultsinpayoutatvestingof200%,requiresTSRof75%. TherewerenochangestoMSUperformancecriteriafor2023.

SpecialLTIAwardsGrantedin2023

•In2023,theCommitteeapprovedspecialLTIforMs.Baker-NelandMessrs.LovinsandColistointhe formofRSUswithgrantdatefairvaluesofapproximately$600,000,$1.5millionand$200,000, respectively;Mr.Lovins’RSUscliff-vestonthethirdanniversaryofthegrantdateandMs.Baker-Nel andMr.Colisto’sRSUscliff-vestonApril1,2025,ineachcasesubjecttotheircontinuedservice.In approvingtheseawards,theCommitteedeterminedtoprovideadditionalincentiveforMr.Lovinsto driveresultsinachallengingbusinessenvironment;forMs.Baker-Neltoensuresmoothkeysenior leadershiptransitions,accelerateourexecutivesuccessionfocusandenhanceCompanyLeadership Teameffectiveness;andforMr.Colistotoincentadvancementofcybersecuritypreparednessand oversightofcriticalenterpriseresourceplanningimplementations.Inconnectionwithhispromotion toCEO,Mr.Standerwasgrantedaspecialawardofstockoptionswithagrantdatefairvalueof approximately$3million,50%ofwhichvestsoneachofthethirdandfourthanniversariesofthe grantdate,subjecttohiscontinuedservice.Mr.ButierdidnotreceiveaspecialLTIawardwhenhe becameExecutiveChairman.

LTIAwardsVestingatYE2023

• AnnualAwardof2021-2023PUs:Our2021-2023TSRwasatthe90th percentilerelativetothe objectivelydeterminedpeergroupestablishedinFebruary2021,resultinginapayoutof200%on thatperformanceobjectiveforallNEOs.Ourcompany’scumulativeEVAwas$1,216.3million, resultinginapayoutof166%onthatperformanceobjectivefortheannualawardof2021-2023PUs forallNEOsotherthanMessrs.StanderandMelo.CumulativeEVAforwhatisnowSolutionswas 96%oftarget,resultinginapayoutof97%onthatperformanceobjectivefortheannualawardof 2021-2023PUsforMessrs.StanderandMelo,whosePUsweretiedtothatbusinessatthetimeof grant.Theannualawardsof2021-2023PUspaidoutbasedonweightedaveragesof123%for Messrs.StanderandMeloand183%forallotherNEOs.

• SpecialAwardof2021-2023PUs:Forretentionpurposesandtofurtherincenthimtocontributeto theresultsforourtotalcompany–includingbycontinuingtotransformourSolutionsbusinessand drivingoursustainabilityprogressasthen-leaderofourenterprise-wideSustainabilityCouncil–Mr.Standerwasgrantedaone-timeawardofPUsinFebruary2021withagrantdatefairvalueof approximately$500,000withthesameperformanceobjectivesandweightingsastheannualaward of2021-2023PUsforCorporateNEOs.Consistentwiththeabove,thesePUspaidoutbasedona weightedaverageof183%.

2023EXECUTIVECOMPENSATIONSUMMARY

Component DecisionsImpacting2023Compensation

LTIAwardsVestingatYE2023

•MSUs

•4th TrancheofMSUsgrantedin2020

2020-2023AbsoluteTSRof62%

Payoutof180%oftarget

•3rd TrancheofMSUsgrantedin2021

2021-2023AbsoluteTSRof32%

Payoutof134%oftarget

•2nd TrancheofMSUsgrantedin2022

2022-2023AbsoluteTSRof(1)%

Payoutof94%oftarget

•1st TrancheofMSUsgrantedin2023

2023AbsoluteTSRof7%

Payoutof98%oftarget

WealsoprovideourNEOswithlimitedperquisitesandbenefitsthattheCommitteebelievesarecomparabletothose offeredbyothermultinationalpubliccompanies.

DISCUSSIONOF2023COMPENSATIONDECISIONS

TheCommitteeaimstohavebasesalariesatoraroundmedianpayatsimilar-sizecompanies,withthesubstantial majorityofNEOcompensationconsistingofincentivecompensationthatdelivershigherrealizedcompensationwhenour financialperformanceisstrongerandlowerrealizedcompensationwhenourfinancialperformanceisweaker.

BaseSalary

ChangestoNEObasesalariesapprovedbytheCommitteearedescribedinthe2023ExecutiveCompensation Summary.IncreasesinbasesalaryforNEOsaregenerallybasedonperformanceandmarketcomparisonsforpositions withsimilarscopeandresponsibility.

NEOBASESALARIES

NEOExecutiveLevel2023YEBaseSalary

Stander1$1,100,000

Butier1$1,000,000

Lovins2$750,000

Melo(1) 2 $518,219

Baker-Nel 3 $490,000

Colisto 3 $456,770

(1) AmountforMr.Melowasconvertedfromeurosusingthe averagemonthlyexchangerateforDecember2023.

2023AIPAwards

The2023AIPwasdesignedtoincentmanagementtoachieveourfinancialgoalsfortheyear. NEOsarenoteligible forguaranteedAIPawards. AIPawardsaredeterminedforeachfiscalyearusingtheformulabelow.Individualmodifiers forNEOsaregenerallycappedat100%althoughtheCommitteeretainsthediscretiontodeterminehigherindividual modifierstorewardexceptionalperformance,upto150%.

TargetAIPOpportunities

ChangestoNEOtargetAIPopportunitiesapprovedbytheCommitteearedescribedinthe2023Executive CompensationSummary.

NEOTARGETAIPOPPORTUNITIES

*TargetAIPopportunitiesforMessrs.Stander,ButierandMelowere proratedbasedontheirpreviousopportunitiesof75%,160%and 50%ofbasesalary,respectively,andtheiryear-endopportunities of135%,120%and60%ofbasesalary,respectively.

AIPPerformanceObjectives;Target-SettingPrinciples

Theperformanceobjectivesandweightingsforthe2023AIPforCorporateNEOs,whichwereconsistentwiththe prioryear,wereestablishedbytheCommitteetocontinueincentingthemtogrowsales,improveprofitabilityand generatestrongcashflow.

2023AIPPERFORMANCEOBJECTIVESFORCORPORATENEOs

Objective

AdjustedSalesGrowth (20%)

AdjustedEPS (60%)

AdjustedFreeCashFlow (20%)

Description

Focusesmanagementontop-linegrowth,akeycontributortosustainedlongtermvaluecreation

Primarydriverofstockholdervaluecreationandmeasureweusetoprovide annualguidancetoinvestors;focusesmanagementonprofitablegrowthand expensecontrol

Cashavailableafterinvestmentinourbusiness,whichwecandeployfor acquisitions,ventureinvestments,dividendsandsharerepurchases;focuses managementonimprovingcapitalefficiency,includingworkingcapital

TheCommitteedeterminedtolinktheAIPfinancialmodifierforourSolutionsNEOprimarilytohisbusiness’results, based45%onadjustednetincomeand40%onadjustedfreecashflow;theremaining15%waslinkedtoadjustedEPS. TheSolutionsobjectivesweredesignedtobeachievableonlyifthebusinessimproveduponits2022performanceand deliveredresultsconsistentwithits2023goals.

ThethresholdpayoutlevelfortheadjustedEPSperformanceobjectiveforallNEOswassetat0%.Thethreshold payoutlevelfortheothertwoperformanceobjectivesforCorporateNEOswassetat50%.ForourSolutionsNEO,the thresholdpayoutlevelfortheadjustednetincomeperformanceobjectivewassetat0%andthethresholdpayoutlevel fortheadjustedfreecashflowperformanceobjectivewassetat50%.ForallperformanceobjectivesforallNEOs,the targetpayoutlevelwas100%andthemaximumpayoutlevelwas200%.Insetting2023AIPtargetsforCorporate NEOs,theCommitteeaimedtoensureconsistencywithour2021-2025financialtargets,givingconsiderationtothe factorsdescribedbelow.

•Targetadjustedsalesgrowth,reflectingsalesgrowthex.currencyexcludingtheimpactofacquisitions completedafterthetargetswereset,of3.5%($9,285M)waslessthanbothour2021-2025salesgrowthex. currencytargetof5%+andour2022salesgrowthex.currencyresultof13.1%because2022resultswere largelydrivenbyourcustomersbuildingupinventorywhensupplychainswereconstrainedandthepricing actionswetooktoaddresssignificantinflation.For2023,weexpectedthatwewouldpasssomeofthebenefit fromtheanticipatedeasingofinflationtoourcustomers.

•TargetadjustedEPSof$9.50wassetabovethemidpointandnearthehighendoftheannualguidancewe providedtoinvestorsinFebruary2023.Duetoanticipatedinventorydestocking,targetwassetlowerthanour 2021-2025compoundannualgrowthtargetof10%and4%higherthanour2022resultof$9.15.

•Althoughwedidnotexternallycommunicatea2021-2025adjustedfreecashflowtarget,ourplanfor2023was todeliveradjustedfreecashflowof$740millionwithsolidnetincomegrowthandworkingcapitalproductivity, partiallyoffsetbyhigherplannedcapitalexpendituresandrestructuringactions.Targetforadjustedfreecash flowwas11%abovetheadjustedfreecashflowweachievedin2022.

2023AIPTARGETSVS.LONG-TERMTARGETSAND2022RESULTS

2021-2025Long-TermTarget2022Results2023AIPTarget

SalesGrowthEx.Currency5%+13.1%3.5%($9,285M)*

*RepresentsAIPtargetforadjustedsalesgrowth

FinancialModifiers

AIPfinancialmodifiersarecappedat200%. Indeterminingfinancialmodifiers,theCommitteehasthediscretionto excludetheimpact,positiveornegative,ofextraordinaryitemssuchasacquisitionsanddivestitures;restructuringand integrationactionsnotincludedinourannualnetincomeplan;currencytranslationfluctuations;changesinaccounting principles,taxcodesorrelatedregulationsandrulings;extraordinaryeventssuchasnaturaldisasters,outbreaksof epidemiologicaldisease,terrorismandwar;costsrelatedtotheearlyextinguishmentofdebtandpensionplan terminations;costsoflitigationoutsidethenormalcourseofbusiness;andnon-cashchargesassociatedwiththe impairmentoflong-livedassetssuchasgoodwill.

Thetablebelowshowsthecalculationof2023AIPfinancialmodifiers.Asshown, thethresholdlevelofperformance wasnotachievedforanyoftheperformanceobjectivesforCorporateNEOsorourSolutionsNEO,resultingin weightedaverageAIPfinancialmodifiersof0%forallNEOs

2023AIPFINANCIALMODIFIERS

(1)

(2) PerformanceobjectivesandweightingsforMr.MeloreflectthosetiedtohisserviceasSolutionsPresidentforthelastninemonthsoftheyear.Hisperformance objectivesforthefirstthreemonthsoftheyearwhenheservedasSVP/GM,AveryDennisonSmartrac,wereadjustedEPS(weighted15%),enterpriseIntelligent Labelssales(weighted40%),enterpriseIntelligentLabelsEBIT(weighted25%);enterpriseIntelligentLabelsadjustedfreecashflow(weighted10%);and Solutionsadjustedfreecashflow(weighted10%).Sales,EBITandadjustedfreecashflowtargetsandresultsatthebusinessunitlevelarenotdiscloseddueto theircompetitivelysensitivenature.Additionally,theCommitteedeterminedthatthefinancialmodifierforallNEOsshouldbezerogiven2023performance.

(3) Reflectsreportednetsalesof$8,364.3million,removingthe$5.1millionimpactofforeigncurrencytranslationsincethetargetwassetandthe$74.4million impactofnewacquisitions.

(4) Reflectsreportednetincomepercommonshare,assumingdilution,of$6.20,adjustedforrestructuringchargesandotheritemsof$1.70andremovingthe ($0.04)impactofacquisitionscompletedafterthetargetswereset.

(5) Reflectsnetcashprovidedbyoperatingactivitiesof$826.0million,minuspurchasesofproperty,plantandequipmentof$265.3millionandsoftwareandother deferredchargesof$19.8million,plusproceedsfromsalesofproperty,plantandequipmentof$1.0million,plusproceedsfrominsuranceandsales(purchases)of investments,net,of$1.9million,plusproceedsfromcompany-ownedlifeinsurancepoliciesof$48.1million,pluspaymentsforcertainacquisition-relatedcostsof $5.3million,lesscashflowfromnewacquisitionsof$9.3million.

(6) Adjustednetincomereferstoincomebeforetaxes,tax-effectedattheadjustedtaxrate,andadjustedfortax-effectedrestructuringchargesandotheritems. Adjustedtaxrateisthefull-yearGAAPtaxrate,adjustedtoexcludecertainunusualorinfrequenteventsthatareexpectedtosignificantlyimpactthatrate,suchas effectsofcertaindiscretetaxplanningactions,impactsrelatedtoenactmentsofcomprehensivetaxlawchanges,andotheritems.

(7) Adjustednetincomeandadjustedfreecashflowmeasuresatthesegmentlevelareinternalmetricsthatexcludeormakesimplifyingassumptionsforitemsthat cannotbeallocatedpreciselybysegment,suchasinterestandincometaxexpenses,andrelatedbalancesheetaccounts,suchasdeferredtaxassetsandliabilities, incometaxpayablesandreceivables,andshort-andlong-termdebt.Certainbalancesheetaccountssuchaspensionandotherpostretirementbenefitsand insurancethataregenerallymanagedatthecorporatelevel,aswellastheimpactofforeigncurrencytranslation,arealsoexcludedfromthecalculationofthese measuresforthesegments.Incertainlimitedcircumstances,one-timeitemsmaybeexcludedfromsegmentadjustednetincome.Theimpactofintercompany salesisincludedinsegmentmeasures.

NEOPerformanceEvaluationsandIndividualModifiers

OurNEOsareevaluatedontheirindividualperformancefortheyear.TheCommitteeapprovedthestrategic objectivesofourthen-CEOandthen-COO,ourthen-COOapprovedthegoalsofourSolutionsNEOandourthen-CEO approvedthegoalsoftheotherNEOs,ineachcaseinFebruary2023.InFebruary2024,theCommitteeevaluatedthe performanceofourCEOagainsthispredeterminedstrategicobjectives;forourotherNEOs,thisassessmentconsidered thetotalityoftheirperformance.

Individualmodifiersforallparticipantsarecappedat150%,subjecttothetotalcaponAIPawardsof200%. Althoughitretainsthediscretiontodetermineindividualmodifiersofupto150%,theCommitteehasdeterminedthatthe individualmodifiersforourNEOsshouldgenerallybecappedat100%.

TheCommitteeevaluatedthe2023performanceofourCEO,givingconsiderationtohisleadershipnavigatingthe lowerdemandenvironmentdrivenprimarilybydownstreaminventorydestocking;ourfinancialresultsfortheyearin whichwedidnotdeliverourannualoperatingplanorachievethethresholdlevelsofperformanceestablishedforthe 2023AIP;hisperformanceagainsthisstrategicobjectivesestablishedinFebruary2023;andhisperformanceselfassessmentdiscussedwiththeCommitteeinFebruary2024. TheCommitteedeterminedtheindividualmodifierforour CEObasedonitsassessmentofhisperformance.

Inadditiontonavigatingthedynamicandchallengingenvironment,ourCEOhadthestrategicobjectivesfor2023 shownbelowwiththeCommittee’sevaluationofhisperformance.Thesestrategicobjectivesdidnothaveassigned weightings,reflectingtheCommittee’sexpectationthathedeliveronallfronts.

2023CEOPERFORMANCEEVALUATION

StrategicObjective Evaluation

CEOreadiness –ContinueprogressingBoard-alignedreadiness plan;engageinquarterlyearningsprocess;andleadstrategic planningprocess

Driveoutsizedgrowthinhigh-valuecategories –DeliveraboveaverageorganicgrowthrateinMaterials’graphicsandspecialty labelsbusinesses;achievetargetedpercentageofgrowthin Solutions’externalembellishmentsbusiness;deliversuccessful Solutions’shelfedgelabelproductivitypilotwithlargeretailer;and reach$1billioninenterprise-wideIntelligentLabelssales

Growprofitablyinourbasebusinesses –Enhanceshareposition inMaterials’NorthAmericaandEurope,MiddleEastandNorth Africa(EMENA)regionsandmaintainsharepositioninother MaterialsregionsandbaseSolutionscategories(adjustedfor IntelligentLabels)

Focusrelentlesslyonproductivity –Delivertargetedamountof savingsfromrestructuringactionsandachieveproductivitytargets inbothMaterialsandSolutions

ProgressedreadinessplanconsistentwithBoardexpectations; engagedinquarterlyearningsprocessbeginningin4Q22, leadingprocessstartingin2Q23;andled2023strategic planningprocessacrossbusinesssegmentsandenterprisewide,includingrelateddiscussionswithBoard

Inchallenginglowervolumeenvironmentdrivenprimarilyby inventorydestocking,deliveredmodestorganicgrowthin Materials’graphicsanddeclineinMaterials’specialtylabels businesses,ineachcaseinlinewithoverallmarketperformance; grewSolutions’externalembellishmentsbutbelowtargeted percentagegivendecliningapparelimportenvironment; progressedSolutions’shelfedgelabelproductivitypilot consistentwithexpectations;and,althoughitsenterprise-wide salestargetwasnotreached,deliveredlow-doubledigitgrowth inIntelligentLabels

EnhancedsharepositioninMaterials’NorthAmericaand EMENAregionsandbaseSolutionscategories(adjustedfor IntelligentLabels),whilealsomaintainingsharepositioninother Materialsregions

Exceededtargetedamountofsavingsfromrestructuringactions by~50%,havingacceleratedcertainactionsgivenweakerthan-anticipateddemand;andachievedproductivitytargetsin bothMaterialsandSolutions

2023CEOPERFORMANCEEVALUATION

StrategicObjective Evaluation

Allocatecapitaleffectively –Investwithintargetedrangeof capitalexpenditures;continuedrivingoperatingworkingcapital productivity;investtargetedamountinacceleratedgrowth platformsofIntelligentLabels,innovationanddigitalinfrastructure; investtargetedamountinIntelligentLabelscapitalexpenditures, includingachievemilestonesrelatedtokeystrategicproject;and continuebuildingM&Apipelineandintegratingacquisitions

Givenlowerdemanddrivenprimarilybydownstreaminventory destocking,appropriatelyreducedcapitalspendingbelowlow endoftargetedrange,whilestillinvestingatlevelconsistent withprioryeartosupportorganicgrowth;improvedworking capitalproductivity;appropriatelyreducedspendingongrowth investments,whilecontinuingtostrategicallyinvestin acceleratedgrowthplatformsofIntelligentLabels,innovation anddigitalinfrastructure;appropriatelydelayedstrategic IntelligentLabelsproject,achievingmilestonesconsistentwith adjustedtimeline;andcompletedacquisitionsofThermopatch, LionBrothersandSilverCrystal,expandingSolutions’external embellishmentsportfolio

Leadinanenvironmentallyandsociallyresponsiblemanner –Progressinnovationstrategyanddeploymentprogram withemphasisonenvironmentalsustainabilityanddigital solutions;continuereducingScope1and2GHGemissionsand beginexecutingScope3emissionsreductionplan;deploy acceleratedroadmaptoenablegreaterrecyclabilityofplasticsin Materialsecosystem;andfurtherenhanceleadershipdiversity

Refine/Executeleadershipsuccession/development –Refine/ Executedevelopmentplansforleadership,withparticularfocuson MaterialsandSolutionsleaders,andenhancedigitalleadership

Progressedinnovationstrategyanddeploymentprogram, includingwithrespecttoenvironmentalsustainabilityanddigital solutions;significantlyreducedScope1and2GHGemissions andbeganexecutingplantoachieve2030Scope3GHG emissionsreductiontarget;completedgapassessmentand developedacceleratedroadmaptoenablegreaterrecyclabilityof plasticsinMaterialsecosystem;and,whilemanager+gender diversitypercentageof36%wasunchangedfromprioryear, increasedrepresentationofwomenatVP+level

ExecutedleadershipsuccessiontransitionsinMaterialsand Solutions;advancedsuccessionanddevelopmentplansofother membersofCompanyLeadershipTeam;andbegan strengtheningdigitalleadership

ThestrategicobjectivesofourformerCEOwereinmanyrespectssimilartothoseshownaboveforourcurrentCEO. Inreviewinghisannualperformance,theCommitteefocusedontheuniqueaspectsofhisstrategicobjectivesestablished inFebruary2023,whichincludedprogressingtheBoard-aligned CEOsuccession strategywiththegoalofready-now successorsovermultipletimehorizons;providingtargeted developmentsupportforourthen-COO;refiningand executing leadershipdevelopmentplans withafocusonnewlyappointedleadersinourMaterialsandSolutions businesses;progressingour cybersecurity strategyanddeploymentprogram;andintegratingthe TCFDframework into ourERMprogram.Inaddition,theCommitteeevaluatedhis performanceasExecutiveChairman.

TheCommitteeChair,togetherwithourLeadIndependentDirector,separatelydiscussedwithourCEOandour ExecutiveChairmanthefeedbackfromdiscussionsoftheCommitteeandourfullBoardregardingtheir2023 performance.

OurCEOrecommendedtotheCommitteetheindividualmodifiersforourotherNEOsbasedonhisassessmentof their2023performance.TheCommitteeconsideredourCEO’srecommendations,retainingthediscretiontoapprove individualmodifiersforthemdifferentthanwhatourCEOhadrecommended.OtherthandiscussingwithourCEOtheir individualperformance,ourotherNEOsplayednoroleintheircompensationdeterminations.Indeterminingtheindividual modifiersforourotherNEOs,theCommitteenotedthehighlightsoftheir2023performanceshownbelow.

Mr.Lovins

•Led enterprisefinance function,includingoverseeingcontrollership,tax,treasury,financialplanningandoperational financeteams

•Criticalsupportto CEOtransition onfinancialplanningandreporting,investorrelationsandotherkeyfinanceareas

•Drove significantproductivitybenefits tomitigateimpactoflowerdemanddrivenprimarilybyinventorydestocking

•Delivered strongadjustedfreecashflow andadjustedfreecashflowconversiongreaterthan100%throughimproved workingcapital

•Enhanced macroenvironmentanalytics andincreased forecastingrigor

•Continueddriving strongglobalcontrollership

•Advanced financesystemstandardization throughenterpriseresourceplanningrolloutsacrossbusinessunits

•Continueddriving ongoingscenarioplanning toensureachievementoflong-termfinancialtargets

•Oversawcontinuedexpansionof sustainabilityreporting

•Maintained strongbalancesheet,investingorganicallyandacquiringthreecompanies,whilealsoreturningcashto stockholdersthroughsharerepurchasesandagrowingdividend

•Ensured effectivecapitalallocation todeliverstrongreturnsandEVAgrowthoverlongterm

•ServedasmemberofADFBoardofTrustees

Mr.Melo

•Successfullytransitionedto SolutionsPresidentrole,improvingcross-businesscollaborationandadvancingcustomercentricity

•Delivered low-double-digitgrowthinIntelligentLabels,expandingintonewsegmentswithsignificantwinsin LogisticsandFoodandexecutingworld’slargestsingle-waveRFIDdeployment

•Navigatedchallenginglowvolumeyear,executingcost-reductioninitiativestoimproveprofitabilityandoptimize cost-to-serve

• Expandedhigh-valueexternalembellishments capabilitieswiththreestrategicacquisitions,enablingsignificant growthinteamsports

•Evolvedandled DigitalAdvisoryCouncil,informingcontinuedexpansionofdigitalcapabilitiesandbuildingonatma.io connectedproductcloudplatform

•ExpandedSolutions’portfoliotoincludemoreproductsmeetingSustainableADvantageStandardand improved recyclingofwaste

Ms.Baker-Nel

•Led enterprisehumanresources,communicationsandcommunityinvestment functions

•Guided CEOandsegmentleadertransitions andadvancedCompanyLeadershipTeamsuccessionplans

•Renewedfocuson seniorleadershipeffectivenessandcomplementarity,drivinggreaterclarityonaccountability

•Facilitated Boardrefreshmentplanning andGovernanceCommittee’snewdirectorsearchprocess

•Deployed digitally-enabledemployeelisteningtool,enhancinginsightsandanalyticsandestablishingnewbaselines foremployeeengagementandinclusion

•Finalized enterprisecompetencymodel toserveasconsistentglobalstandardagainstwhichwehire,develop,promote andrewardtalent

•PublishedinauguralDEISynopsisreporttoenhance socialsustainabilitytransparency andprogressed payequity and transparency

•ServedasmemberofADFBoardofTrustees

Mr.Colisto

•Led enterpriseIT function,includingmanagementofITinfrastructure,cybersecurity,dataanalyticsandbusiness softwareinitiatives

•Deliveredstrongperformanceinchallengingenvironment, managingincreasingcybersecuritythreats andaccelerating ITmodernizationtodriveinnovationandgrowth

•Enhanced digitizingbusinessprocesses,deliveringenterpriseresourceplanningsystemsandenablingimproved efficiencyanddata-drivendecision-making

•Advanced digitalcustomerengagementplatforms,improvingcustomerexperienceandbusinessresilience

•Developed technologyinvestmentallocationstrategy tomaximizereturnsandsupportfuturegrowth

•Educatedglobalteamson artificialintelligence,identifyingmostpromisingusecasesandunlockingpotentialavenues forprocessinnovationandefficiency

•Servedasexecutivesponsorofwomeninleadership, advancingDEI byempoweringfemaleleaders

BasedontheseassessmentsandaftergivingconsiderationtotherecommendationsofourCEO(otherthanwith respecttohimself), theCommitteeapprovedindividualmodifiersof100%forallNEOs,whichhadnoimpactontheir AIPpayoutsgiventhe0%financialmodifiers.

AIPAwards

Asshownbelow,ourNEOsreceivednoAIPawardsfor2023.

2023AIPAWARDS

(1) Mr.Stander’stargetAIPopportunitywasproratedbasedonhisopportunityasCOOof75%ofbasesalaryforthefirsteightmonthsoftheyear andhisopportunityasCEOof135%ofbasesalaryforthelastfourmonthsoftheyear.

(2) Mr.Butier’stargetAIPopportunitywasproratedbasedonhisopportunityasCEOof160%ofbasesalaryforthefirsteightmonthsoftheyear andhisopportunityasExecutiveChairmanof120%ofbasesalaryforthelastfourmonthsoftheyear.

(3) AmountsforMr.MelowereconvertedfromeurosusingtheaveragemonthlyexchangerateforDecember2023.

(4) Mr.Melo’stargetAIPopportunitywasproratedbasedonhisopportunityasSVP/GM,AveryDennisonSmartrac,of50%ofbasesalaryforthe firstthreemonthsoftheyearandhisopportunityasSolutionsPresident,of60%ofbasesalaryforthelastninemonthsoftheyear.

2023GRANTSOFLTIAWARDS

OurLTIprogramprovidesvariableincentivecompensationtoenhancealignmentofexecutiveinterestswith stockholderinterestsanddrivelong-termvaluecreation.The annualLTIawardsgrantedtoNEOsin2023werefully performancebased anddeliveredthroughtheequityvehiclesdescribedbelow.

•50%inPUsthatcliff-vestattheendofathree-yearperiodsubjecttotheachievementoftherespective cumulativeEVAandrelativeTSRperformanceobjectivesestablishedfortheaward

•50%inMSUsthatvestattheendofthe1-,2-,3-and4-yearperformanceperiods,withanaverage performanceperiodof2.5years,basedonourabsoluteTSR

AnnualLTIawardsweregrantedonMarch1,2023.Actualamounts,ifany,realizedbyourNEOsfromthevestingof theseawardswillbebasedonourperformance,aswellasourstockpriceatthetimeofvesting.

TheCommitteedoesnotoffsetthelossorgainofprioryeargrantsindeterminingcurrentyeargrants,asdoingso wouldcompromisetheintendedrisk/rewardnatureoftheseincentives.

SpecialLTIawardsmaybegrantedbytheCommitteeforhiring,promotion,retentionandotherincentivepurposes, withtheawardsgrantedonthefirstdayofthelastmonthofthequarterfollowingtheeventordecisiontomakeagrant. ThefourspecialLTIawardsapprovedbytheCommitteein2023aredescribedinthe2023ExecutiveCompensation Summaryandshowninachartlaterinthissection.

TargetLTIOpportunity

ChangestoNEOtargetLTIawardopportunitiesapprovedbytheCommitteearedescribedinthe2023Executive CompensationSummary.

NEO2023TARGETLTIOPPORTUNITIES

(1) Mr.Stander’stargetLTIopportunityreflectsopportunityasCOOsincehisrolechange occurredaftertheMarch1,2023grantdate.TheCommitteepreliminarilyalignedinMay 2023toincreaseMr.Stander’stargetLTIopportunityto550%effectiveMarch1,2024, subjecttoitsreviewofmarketpayforsimilarrolesatthattime.

(2) WhenhewasservingasCEO,Mr.Butier’stargetLTIopportunitywasincreasedfrom585% ofbasesalaryto700%ofbasesalaryeffectiveMarch1,2023tobemoreconsistentwith marketdataforcompanieswithrevenuesof$10billionandtoacknowledgehisdeliveryof top-quartileTSRduringhistenure.Atthetimeofhisrolechange,theCommitteehadnot determinedhistargetLTIopportunityasExecutiveChairman.

(3) Mr.Melo’stargetLTIopportunityreflectsopportunityasSolutionsPresident,sincehisrole changeeffectiveApril1,2023hadbeendeterminedbeforetheMarch1,2023grantdate.

PerformanceUnits(PUs)

PUscliff-vestinsharesofourcommonstockaftertheendofathree-yearperiodatthreshold(50%payout),target (100%payout)andmaximum(200%payout)levelsbasedonourachievementoftheperformanceobjectivesestablished fortheaward.PUsdonotaccruedividendequivalentsandarenotcountedforpurposesofourstockownershippolicy.

TheCommitteeestablishedthefollowingperformanceobjectivesforthe2023-2025PUs.TheCommitteebelieves thattheseobjectivesalignexecutivecompensationwiththelong-terminterestsofourstockholdersbecausedelivering cumulativeEVAandstrongTSRrelativetopeercompaniesreflectsthevaluewecreateforourinvestors.

• CumulativeEVA,weighted50%forCorporateNEOs(basedoncompanyEVA)and75%forourSolutions NEO(basedonsegmentEVA). EVAiscalculatedbydeductingtheeconomiccostassociatedwiththeuseof capital(weightedaveragecostofcapitalmultipliedbyaverageinvestedcapital)fromafter-taxoperatingprofit, withthecostofcapitalfixedovertheperformanceperiod.TheCommitteeestablishedEVAtargetsforCorporate NEOsconsistentwithour2021-2025financialgoalsforearningsgrowthandROTCandourprimaryobjectiveof deliveringsuperiorTSR,withthetargetpayoutsetatoranearthehighendofthesegoalsandthemaximum payoutexceedingthehighendofthesegoals.EVAtargetsforourSolutionsNEOfocusedonthebusiness’EVA changecomparedtothepriorthree-yearperiod,withthecostofcapitalfixedovertheperformanceperiod. Whetherlinkedtocompanyorbusinessresults,achievementof2023-2025cumulativeEVAtargetsrequires significantimprovementinourfinancialperformance.

• RelativeTSRcomparedtoanobjectivelydeterminedpeergroupofcompanies,weighted50%forCorporate NEOsand25%forourSolutionsNEO.TheCommitteedesignedtheTSRobjectivetoproviderealized compensationonlyifourstockholdervaluecreationcomparesfavorablyrelativetothedesignatedpeergroup, thenamesofwhicharelistedunder PeerGroups laterinthisCD&A.TheCommitteesetthethresholdpayoutat TSRatthe40th percentile,targetpayoutatTSRatthe50th percentileandmaximumpayoutatTSRatthe 80th percentile,whichwerethesamelevelsusedforthe2022-2024PUs.PayoutsfortherelativeTSR componentofPUsarecappedat100%oftargetifourabsoluteTSRisnegative.Inassessingtherigorofthe TSRobjectives,theCommitteenotedthatperformingatthemedianrelativetopeersoverthe2023-2025period wouldrepresentsolidperformanceinlightofanticipatedheadwindsfromforeigncurrencyfluctuations, inflationarypressuresandsupplychainchallenges.

CORPORATE

2023-2025PUs

NEOsPerformanceObjectivesWeighting

Stander

Butier

Lovins

Baker-Nel

Colisto

Market-leveragedStockUnits(MSUs)

MSUsareperformance-basedLTIawardstiedtoourabsoluteTSR.MSUsaredesignedtoachievetheCommittee’s combinedobjectivesofretentionandhigherincentivecompensationdrivenbystockpriceappreciation.MSUsvestbased ontheperformanceperiodsshownbelow,withthenumberofsharespaidoutatvestingbasedonourabsoluteTSRand thevaluerealizedreflectingboththenumberofsharespaidoutaswellasourstockpriceatthetimeofvesting.Although dividendequivalentsaccrueonMSUsduringtheperformanceperiod,theyareearnedandpaidonlyatvesting;ifthe thresholdlevelofperformanceisnotachieved,anydividendequivalentsaccruedduringtheperformanceperiodare cancelledwiththetrancheofawardssubjecttovesting.

TheperformancecriteriaforMSUsareshownbelow.TheCommitteedeterminedtomaintainthesameMSU performanceobjectivesfor2023becausetheyareachievingtheCommittee’sgoalofincentingstrongperformanceand valuecreation.

MSU PERFORMANCE PERIODS

AVERAGE MSU PERFORMANCE PERIOD = 2.5 YEARS

AnnualLTIAwards

MSUPERFORMANCECRITERIA

AbsoluteTSRUnitPayout

Cancelled<(15)%0%

Threshold(15)%85%

Target10%100%

AboveTarget>10%>100% Maximum75%200%

OurNEOsweregrantedtheannualLTIawardsshowninthetablebelowinMarch2023.Thenumberofawards grantedwasbasedontherespectiveNEO’sbasesalaryatyear-end2022andtarget2023targetLTIopportunity.The numberofPUsgrantedfortheEVAcomponentwasbasedontheaverageclosingpriceforsharesofourcommonstock duringthefirst10tradingdaysofFebruary2023;thenumbersofPUsgrantedfortherelativeTSRcomponentandMSUs grantedwerebasedongrantdatefairvalueusingtheMonte-Carlosimulationmethoddescribedinfootnote(2)ofthe 2023SummaryCompensationTable

2023ANNUALLTIAWARDS

SPECIALLTIAWARDS

Ms.BakerNelandMessrs.Stander,LovinsandColistoweregrantedspecialone-timeLTIawardsin2023asshown inthetablebelow.TheCommittee’srationalefortheawardstoMs.Baker-NelandMessrs.LovinsandColistois describedinthe2023ExecutiveCompensationSummary.

2023SPECIALLTIAWARDS

StockOptions(#)ExercisePrice($)RSUs(#)LTIValue

Stander(1) 62,955$190.54–$3,000,025

Lovins(2) – –8,230$1,430,732

Baker-Nel(2) – –3,292$578,870

Colisto(2) – –1,097$192,898

(1) StockoptionsawardedtoMr.StanderinconnectionwithhispromotiontoCEOvest50% oneachofthethirdandfourthanniversariesofthegrantdate,subjecttohiscontinued service.

(2) RSUsawardedtoMr.Lovinscliff-vestonthethirdanniversaryofthegrantdateand RSUsawardedtoMs.Baker-NelandMr.Colistocliff-vestonApril1,2025,ineachcase subjecttotheircontinuedservice.

2023VESTINGOFPREVIOUSLYGRANTEDANNUALLTIAWARDS

AnnualAwardof2021-2023PUs

TheannualawardofPUsgrantedtoourNEOsinFebruary2021forthethree-yearperiodendingin2023were eligibletovestbased(i)forourNEOsotherthanMessrs.StanderandMelo,50%oncompanycumulativeEVAand50% onrelativeTSRcomparedtoapeergroupofcompanies,thenamesofwhicharelistedunder PeerGroups laterinthis CD&A;and(ii)forMessrs.StanderandMelo,75%onthecumulativeEVAofwhatisnowourSolutionsGroupand25% onrelativeTSR. Thekeygoal-settingprincipleinsettingcompanycumulativeEVAtargetswasconsistencywithour 2021-2025financialtargetsforearningsgrowthandROTC,whichtheCommitteebelievestranslatesintodelivering above-averageTSR.

ThecompanycumulativeEVAtargetof$1,150millionfortheannualawardofPUstoourNEOsotherthanMessrs. MeloandStanderwasconsistentwithourlong-termfinancialgoalsfororganicsalesgrowthandoperatingmargin expansionandrecognizedthatincreasingsalesandoperatingmargin,togetherwithbalancesheetefficiency,arekey driversofEVAimprovement.OurcompanycumulativeEVAtargetwas~26%higherthanthecumulativeEVAwe deliveredinthethree-yearperiodendingin2020.ThecompanycumulativeEVAof$1,250millionrequiredformaximum payoutwasconsistentwiththehighendofourlong-termgrowthandoperatingmargintargets.Asshownbelow, we deliveredcumulativeEVAof$1,216.3millionforthe2021-2023performanceperiod,resultinginapayoutof166% forthatcomponent forourNEOsotherthanMessrs.StanderandMelo.

2021-2023PUs:COMPANYCUMULATIVEEVA

779.3759.0611.5

Capitalcharge(3) (306.9)(307.9)(318.7)

EVA

$472.4$451.1$292.8$1,216.3

(1) AdjustedEBITisanon-GAAPfinancialmeasuredefinedandreconciledfromGAAPinAppendixAofthisproxy statement.

(2) GAAPtaxratesfor2021,2022and2023were25.0%,24.2%and27.6%,respectively.Taxesareshownbasedon adjustedtaxratesof25.0%,24.7%and25.8%for2021,2021and2023,respectively.Theadjustedtaxraterepresents thefull-yearGAAPtaxrate,adjustedtoexcludecertainunusualorinfrequenteventsthatareexpectedtosignificantly impactthatrate,suchastheeffectsofcertaindiscretetaxplanningactions,impactsrelatedtoenactmentsof comprehensivetaxlawchanges,andotheritems.

(3) 8.5%ofaverageinvestedcapitalof$3.61billionin2021,$3.62billionin2022and$3.75billionin2023,ineachcase usinganannualfive-pointaverage(DecemberofprioryearandMarch,June,SeptemberandDecemberofcurrentyear) ofshort-andlong-termdebtplusequity,adjustedtoexcludetheimpactofacquisitionscompletedsincethetargetwas set.

SolutionscumulativeEVAfortheannualawardofPUsforthe2021-2023performanceperiodwas96%ofthetarget levelofperformance,resultinginapayoutof97%onthatperformanceobjectiveforMessrs.StanderandMelo.EVA targetsandresultsatthesegmentlevelarenotdisclosedduetotheircompetitivelysensitivenature.

RelativeTSRforthe2021-2023performanceperiodwasatthe90th percentileofthedesignatedpeergroup, resultingina200%payoutforthatcomponentforallNEOs.

PUsforthe2021-2023performanceperiodpaidoutbasedonweightedaveragesof123%forMessrs.Standerand Meloand183%forallotherNEOs.

2021-2023

SpecialAwardof2021-2023PUs

2021-2023

Forretentionpurposesandtofurtherincenthimtocontributetotheresultsforourtotalcompany–includingby continuingtotransformourSolutionsbusinessanddrivingoursustainabilityprogressasthen-leaderofourenterprisewideSustainabilityCouncil–Mr.Standerwasgrantedaone-timeawardofPUsinFebruary2021withagrantdatefair valueofapproximately$500,000withthesameperformanceobjectivesandweightingsastheannualawardof20212023PUsforCorporateNEOs.Consistentwiththeabove,thesePUspaidoutbasedonaweightedaverageof183%.

MSUsEligibleforVestingatYE2023

FourtranchesofMSUswereeligibleforvestingattheendof2023basedonourabsoluteTSRforthefour-,three-, two-andone-yearperformanceperiodsshownbelow,withthenumberofsharespaidoutatvestingdeterminedin accordancewiththeformulashownbelow.

Stockpriceatsettlement(avg.closing pricefortradingdaysofJanuary2024)+ reinvesteddividendsduringperiod

Payoutatvesting ÷=

Stockpriceatgrant(avg.closingpricefor tradingdaysofJanuaryofyearofgrant)

Perquisites

OurNEOsreceivetheperquisitesshowninthechartbelow.WedonotreimburseourNEOsforthetaxconsequences oftheirreceiptoftheseperquisites.

LIMITEDPERQUISITES

ExecutiveBenefitAllowance $70,000forCEO,$65,000forMr.Lovinsand $50,000forLevel3NEOs;amountstaxablewith nogross-up

FinancialPlanning

Annualreimbursementofupto$25,000forCEO and$15,000forLevel2NEOs;taxablewithno gross-up

Flatallowancereducesexpenseofadministering varietyofseparateperquisites

Allowsmostseniorexecutivestofocusonjob duties

AnnualPhysicalExamination Paiddirectlytoserviceprovider;nottaxableHelpsensureleadersmaintaingoodoverallhealth

GeneralBenefits

NonqualifiedDeferredCompensationBenefits

OurU.S.NEOsareeligibletoparticipateinournonqualifieddeferredcompensationplan,whichallowseligibleU.S. employeestodeferupto75%oftheirbasesalaryandupto90%oftheirAIPaward.TheplanprovidestheseNEOsand othereligibleU.S.employeeswithalong-termcapitalaccumulationopportunitybecausedeferredamountsaccumulate onapre-taxbasis.Participantsmayselectfromanumberofinvestmentoptions,withdeferrals100%vested. Our deferredcompensationplandoesnotofferabove-marketinterestrates.

Ourcompanymadeacontributioneffectiveasofthefirstbusinessdayof2023tothedeferredcompensation accountsofeligibleparticipantsfor(i)401(k)eligiblepayin2022inexcessoftheInternalRevenueCodeof1986,as amended(the“Code”)compensationlimit,and(ii)theirrespectivedeferredcompensationdeferrals.Thisannual contribution,whichisdesignedtosupplement401(k)contributionsthatarelimitedundertheCode,providesan automaticcontributionof3%ofdeferredandeligiblepayandamatchingcontributionofupto50%ofthefirst7%of deferrableandeligiblepayabovetheCodecompensationlimit.

ForadditionalinformationregardingourdeferredcompensationplanandaccruedNEObenefitsthereunder,see 2023 NonqualifiedDeferredCompensation in ExecutiveCompensationTables

PensionBenefits

Messrs.ButierandLovinsareouronlyNEOseligible,subjecttothesametermsandconditionsasourothereligible U.S.employees,forpensionbenefitsunderourbenefitrestorationplan,anonqualifiedexcessbenefitplan.Becausethe accrualofbenefitsunderthebenefitrestorationplanwasfrozenasofyear-end2010,neitherofoureligibleNEOs accruedadditionalpensionbenefitsduring2023.Foradditionalinformationregardingthebenefitrestorationplanand accruedNEObenefitsthereunder,see 2023PensionBenefits in ExecutiveCompensationTables.

DefinedContributionBenefits

OurU.S.NEOsareeligibletoparticipateinouremployeesavingsplan,aqualified401(k)planthatallowsU.S.employeesto deferupto100%oftheireligibleearningslesspayrolldeductionsonapre-taxbasisand25%oftheireligibleearningsonan after-taxbasis,subjecttotheannuallimitprescribedbytheInternalRevenueService(IRS)fortheaggregateofcompany contributionsandemployeepre-andpost-taxcontributions.Employeedeferralsareimmediatelyvesteduponcontribution.In 2023,wecontributedupto6.5%ofanemployee’seligiblecompensation,3%ofwhichwasanautomaticcontributionandupto 3.5%ofwhichwasamatchingcontributionof50%oftheemployee’scontributionsupto7%ofpay,subjecttotheCode compensationlimit.Participantsvestinourcontributionstotheirsavingsplanaccountaftertwoyearsofservice.

AllU.S.NEOsparticipatedinthesavingsplanin2023,subjecttothetermsandconditionsasourotherU.S.employees, andarefullyvested.

ExecutiveLifeInsuranceBenefits

Inadditiontothe$50,000inlifeinsurancebenefitsweprovidetoallU.S.employees,ourU.S.executivesareprovided withsupplementallifeinsurancebenefitsequaltothreetimestheirbasesalaryless$50,000,uptoamaximumcoverage amountof$1million.

72 2024ProxyStatement | AveryDennisonCorporation

ExecutiveLong-TermDisabilityInsuranceBenefits

Iftheyelecttoenrollinexecutivelong-termdisabilitycoverage,ourU.S.NEOs’long-termdisabilitybenefitisequalto 65%oftheireligiblepre-disabilitymonthlyearningsuptoamaximumof$25,000permonth.Coverageisavailableonly fortheindividual;dependentsarenotcovered.

ExecutiveExcessLiabilityInsuranceBenefits

Weprovide$3millionofpersonalexcessliabilityinsurancecoveragetoourU.S.executives.Personalexcessliability coveragesupplementsthecoverageprovidedbytheindividual’spersonalliabilityinsuranceprovidedthattheymaintain certainminimumcoveragerequirements.

CharitableMatchBenefits

Wematchupto$10,000ofourCEO’sandourExecutiveChairman’sand$5,000ofourotherNEOs’annual documentedcontributionstocharitableorganizationsoreducationalinstitutions.

SeveranceBenefits

Consistentwithmarketpractices,theCommitteebelievesthatprovidingourexecutiveswithseverancebenefitshelps ensurethattheyactinthebestinterestsofourcompanyandstockholders,evenifdoingsomaybecontrarytotheir personalinterests,suchaswhereitcouldleadtoterminationoftheiremploymentorachangeofcontrolofourcompany.

ThecompensationofourNEOsintheeventofterminationnotforcauseisgovernedbyourAmendedandRestated ExecutiveSeverancePlan(the“SeverancePlan”)and,asapplicable,ourAmendedandRestatedKeyEmployeeChangeof ControlSeverancePlan(the“COCSeverancePlan”).Weusetheseplansratherthanindividuallynegotiatedagreements toallowustochangetheseverancebenefitsforwhichapplicableNEOsareeligibletoreflectmarketpracticeswithoutthe needtoobtaintheirindividualconsent.Inaddition,thisplan-basedapproacheliminatestheneedtoindividuallynegotiate severancearrangementsandensuresthateligibleNEOsreceivebenefitsonthesametermsandconditionsasemployees withsimilarlevelsofresponsibility.Receiptofbenefitsundertheseplansisconditionedontheexecutivesigningawaiver andgeneralreleaseofclaimsagainstourcompany,aswellasagreeingtocertainrestrictivecovenantsinfavorofour company.Anyviolationofthesecovenantscouldresultinourcompanyseekingtorecoversomeorallseverancebenefits previouslypaidorpursuinganyotherclaimsthatmaybeappropriateunderthecircumstances.

Unvestedequityawardsoutstandingonthedateofterminationaregenerallycancelled,exceptforemployeeswho qualifyasretirementeligibleunderthetermsofourequityincentiveplan,whoseawardsareacceleratedupontermination ofservice.Mr.StanderwastheonlyNEOwhoqualifiedasretirementeligibleatyear-end2023.

ForadditionalinformationregardingpotentialNEObenefitsundertheseplans,includingthetreatmentofequity awardsundervariousterminationscenarios,see PaymentsUponTerminationasofDecember30,2023 in Executive CompensationTables

SeveranceFollowingInvoluntaryTerminationNotforCause

OurNEOs(excludingMr.Butier)areeligibletoreceiveseverancebenefitsuponinvoluntaryterminationnotfor “cause,”inaccordancewiththetermsandconditionsoftheSeverancePlan. Intheeventofaqualifyingtermination,our CEOwouldreceivetwotimesthesumofhisannualsalary,targetAIPawardfortheyearofterminationandthecash valueof12monthsofhisqualifiedmedicalanddentalinsurancepremiums;ourothereligibleNEOswouldreceive onetimestheirrespectivesumoftheseamounts. Theywouldalsobeeligibletoreceiveupto$25,000inoutplacement servicesforoneyearfollowingterminationofemployment.AnypaymentsmadeundertheSeverancePlanwouldbe offsetbyanypaymentsreceivedbytheNEOunderanystatutory,legislativeandregulatoryrequirementor,ifapplicable, theCOCSeverancePlan.

SeveranceFollowingChangeofControl

Messrs.Stander,LovinsandMeloareouronlyNEOseligibleforenhancedseverancepaymentsuponterminationnot forcauseorbytheexecutiveforgoodreasonwithin24monthsofachangeofcontrolofourcompany,inaccordance withthetermsandconditionsoftheCOCSeverancePlan. Intheeventofaqualifyingterminationfollowingachange ofcontrol,ourCEOwouldreceivethreetimesthesumofhisannualsalary,targetAIPawardfortheyearof terminationandthecashvalueof12monthsofhisqualifiedmedicalanddentalinsurancepremiums;ourLevel2 NEOswouldreceivetwotimestheirrespectivesumoftheseamounts. TheseNEOswouldalsobeeligibletoreceivea

proratedAIPawardfortheyearofterminationandupto$25,000inoutplacementservicesforoneyearfollowing terminationofemployment.AnypaymentsundertheCOCSeverancePlanwouldbeoffsetbyanypaymentsreceivedby theNEOundertheSeverancePlanandanyotherstatutory,legislativeandregulatoryrequirement.Intheeventof terminationfollowingachangeofcontrol,ourLevel3NEOswouldbeentitledtoreceivebenefitsundertheSeverance Plandescribedabove.

ParticipatingNEOsarenoteligibletoreceiveanyexcisetaxgross-uponamountspayableundertheCOCSeverance Plan.IftheNEOwouldotherwiseincurexcisetaxesunderSection4999oftheCode,paymentsundertheCOCSeverance Planwouldbereducedsothatnoexcisetaxeswouldbedueifthereductionresultsinagreaterafter-taxbenefittothe NEO.

Underourequityincentiveplans,unvestedequityawardswouldgenerallyvestonlyifourNEOsareterminated withoutcauseorresignforgoodreasonwithin24monthsafterthechangeofcontrol.OutstandingPUsandMSUsvest basedonactualperformance,ifdeterminable,andotherwisebasedontargetperformance.

COMPENSATION-SETTINGTOOLS

MarketSurveyData

TheCommitteeannuallyconsidersmarketsurveydatatotargetTDC,consideringcompaniesofsimilarsizebasedon annualrevenuesacrossallindustriestoreflectthebroadtalentmarketacrosswhichweseekourexecutives.The Committeereviewsresultsfromathird-partysurveytounderstandmarketcompensationpracticesandassessour competitiveness,narrowingthescopeoftheresultstoaccountforvariationscausedbycompanysize.

InFebruary2023,theCommitteewaspresentedwithindustry-widedatafromthemostrecentWTWGeneral IndustryExecutiveCompensationSurvey.Primarymarketratesreferencedwerecompanieswithannualrevenuesof $10billion,aspredictedeitherbyregressionanalysisorestimatedastheaverageofcompanieswithannualrevenuesof (i)$6billionto$10billionand(ii)$10billionto$20billion. Recognizingourcompany’sgrowthtrajectoryandtop quartileperformanceinrecentyears,theCommitteedetermineditwasappropriatetoassessmarketcompetitiveness forourCEOandExecutiveChairmanatthe$10billionlevelratherthanthe$6billionto$10billionrangeitused previously;theCommitteeprimarilyusedthepreviousrangeforassessingthemarketcompetitivenessforourother NEOs,whilealsoreferencingdataforcompanieswithannualrevenuesof$10billion. TheCommitteereviewedthe dataonanaggregatedbasis,withnoconsiderationofthesurvey’scomponentcompanies,whichwerenotdeterminedor knownbytheCommittee.

TheCommitteeusesthesurveydataasareferencepointtotargetTDCandthecomponentsthereof,giving considerationtoresponsibilities,individualperformance,tenure,retentionandsuccession.

TallySheets

TheCommitteeannuallyreviewstallysheetsthatreflectthecomponentsofeachNEO’scompensation.Thetally sheetsreviewedinFebruary2024includedtheinformationshownbelowforeachofthemostrecentthreefiscalyears.

•Cashcompensation(basesalaryandAIPawards),LTIawards,valueofvestedLTIawards,andannualizedcost ofbenefitsandperquisites

•Valueofannualcompensation,includingbasesalary,AIPawardandgrantdatefairvalueofLTIawards

•Accumulatedvalueofcompensation,includingoutstandingLTIawardsandaccumulatedbenefitvaluesunder pensionanddeferredcompensationplans

•Potentialpaymentsundervariousterminationscenarios

•Compliancewithourstockownershippolicy

TheCommitteebelievesthatreviewingtallysheetsisusefulindeterminingexecutivecompensationbecausethey provideahistoricalperspectiveonNEOcompensationandincludeinformationthatwillbecontainedinourproxy statement.

PeerGroups

Beginningin2023,fordeterminingrelativeTSR,theCommitteeusedthefollowingobjectivecriteriaforpurposesof identifyingthepeergroup:publiccompaniesprimarilylistedonaU.S.stockexchange(previouscriterionwas headquarteredintheU.S.)(i)insimilarindustriesbasedontheirclassificationinoneoffiveGICSgroups(diversified chemicals,specialtychemicals,metalandglasscontainers,paperpackaging,andpaperproducts)and(ii)withmarket capitalizationofatleast$1.5billionandrevenuesduringthelast12monthsof$3billionto$30billion(previouscriterion wasonlyrevenuesduringthelast12monthsof$1billionto$20billion).

PEERGROUPFORDETERMININGRELATIVETSRFORPUs

2023-2025PUsATFYE2023(31companies) 2021-2023PUsATTIMEOFPAYOUT(39companies)

AlbermarleCorporation

Amcorplc

AptarGroup,Inc.

ArdaghMetalPackagingS.A.

AvientCorporation

AxaltaCoatingSystemsLtd.

BallCorporation

BerryGlobalGroup,Inc.

CelaneseCorporation

CrownHoldings,Inc.

DupontdeNemours,Inc.

EastmanChemicalCompany

EcolabInc.

GraphicPackagingInternational, LLC

Greif,Inc.

H.B.FullerCompany

HuntsmanCorporation

InternationalFlavors& FragrancesInc.

InternationalPaperCompany

O-IGlass,Inc.

PackagingCorporationof America

PactivEvergreenInc.

PPGIndustries,Inc.

RPMInternationalInc.

SealedAirCorporation

SilganHoldingsInc.

SonocoProductsCompany

SylvamoCorporation

TheChemoursCompany

TheSherwin-WilliamsCompany

WestrockCompany

INDEPENDENTOVERSIGHTANDEXPERTISE

AlbermarleCorporation

AptarGroup,Inc.

AshlandGlobalHoldingsInc.

AxaltaCoatingSystemsLtd.

AvientCorporation

BallCorporation

BerryGlobalGroup,Inc.

CelaneseCorporation

ClearwaterPaperCorporation

CrownHoldings,Inc.

EastmanChemicalCompany

EcolabInc.

EcovystInc.

ElementSolutionsInc.

GraphicPackagingInternational, LLC

Greif,Inc.

H.B.FullerCompany

HuntsmanCorporation

IngevityCorporation

InnospecInc.

InternationalFlavors& FragrancesInc.

MineralsTechnologiesInc.

NewMarketCorporation

O-IGlass,Inc.

PackagingCorporationofAmerica

PactivEvergreenInc.

PPGIndustries,Inc.

QuakerChemicalCorporation

RayonierInc.

RPMInternationalInc.

SealedAirCorporation

SensientTechnologies

Corporation

SilganHoldingsInc.

SonocoProductsCompany

StepanCompany

TheChemoursCompany

TheSherwin-Williams Company

Valhi,Inc.

WestRockCompany

OurBoardbelievesthatretainingourexecutivesandprovidingthemwithmarket-competitivecompensationare essentialtothesuccessofourcompanyandadvancingtheinterestsofourstockholders.TheCommittee,whichis composedsolelyofindependentdirectors,isresponsibleforapprovingexecutivecompensation.TheCommitteemay delegateauthoritytosubcommitteesor,incertaincircumstancesunrelatedtothecompensationofourexecutiveofficers, toourCEO.

Underitscharter,theCommitteemayretainandterminateanycompensationconsultantorotherexternaladvisorat ourexpenseandhassoleauthoritytoapprovetheadvisor’sfeesandothertermsandconditionsoftheretention.The Committeeannuallyconsiderstheindependenceofitsadvisors.

TheCommitteehasretainedWTWasitsindependentcompensationconsultant,withthefirmperformingthe servicesdescribedbelowfororattherequestoftheCommitteein2023.

2023WTWSERVICES

•AdvisedonCEOsuccessionandotherleadershiptransitions

•BenchmarkedCEOandExecutiveChairmancompensation

•Providedstrategicreviewofexecutivecompensationprogram

•Providedincentivecompensationadvice(includingrecommendingrevisedcriteriafordeterminingpeergroupfor measuringrelativeTSRcomponentofPUs)

•ConductedanalysesofshareutilizationandstockholdervaluetransferrelatedtoLTIcompensation

•Commentedonour2023CD&Aandcertainotherproxystatementdisclosures

•Analyzedaproxyadvisoryfirm’sprojectedpay-for-performanceanalysis

•Advisedonexecutivecompensationtrendsandregulatoryupdates

•Preparedfor,attendedandrevieweddocumentationforCommitteemeetings

In2023,WTWreceived$344,972incompensationfromourcompanyforprofessionalservicesperformedfororat therequestoftheCommittee.Wealsoreimbursedthefirmforitsreasonableout-of-pocketexpenses.

TheCommitteeconducteditsannualassessmentofWTW’sperformanceinDecember2023,whichincludedan evaluationofthefirm’sservicedeliveryprovidedduringtheyear,aswellasthecriteriadescribedbelow.

• Experience –Thefirm’sdepthandbreadthofexecutivecompensationandboardadvisoryknowledgeand experience;qualificationsasaboard-levelconsultant;qualityofresourcesavailable,includingstaffanddata;and understandingofourbusinessstrategy,challenges,industry,performancedriversandtalentconsiderations

• Independence –Thefirm’sobjectivityingivingadviceandmakingrecommendations,anditswillingnessto providecandidfeedbackregardingmanagementandCommitteeproposals,questionsandconcerns

• Preparation –Thequalityandtimelinessofthefirm’sreports,includingaccuracy,typeandamountof information,clearcommunicationandresponsivenesstoissues;itsreviewandfeedbackonmanagement proposals;andthefirm’spreparationwiththeCommitteeChairandmanagement,asappropriate

• CommitteeRelationship –Theaccessibilityandavailabilityandcommunicationeffectivenessofmembersofthe engagementteamandthefirm’sreportingrelationshipwiththeCommitteeChairandworkingrelationshipwith management

Basedonthisevaluation,theCommitteeexpresseditscontinuedsatisfactionwiththeperformanceofWTWandthe membersoftheengagementteamadvisingtheCommittee.TheCommitteeChairdiscussedwiththeleadmembersof theengagementteamtheCommittee’sfeedbackontheirperformance,includingpotentialimprovementopportunities.

AdvisorIndependence

WTWandtheCommitteehavehadthefollowingprotocolsinplacesincetheengagementcommencedtoensurethe firm’sindependencefrommanagement: theCommitteehasthesoleauthoritytoselect,retainandterminateWTW and,actingthroughitsChair,authorizethefirm’sfees,determinethetermsandconditionsthatgovernthe engagement anddirectWTWonthedeliveryandcommunicationofitsworkproduct; intheperformanceand evaluationofitsduties,WTWisaccountable,andreportsdirectly,totheCommittee;andmembersoftheCommittee mayconsultwithWTWatanytime,withorwithoutmembersofmanagementpresent,intheirsolediscretion.

TheCommitteeconsideredtheindependenceofitsadvisorsinDecember2023.TheCommitteehasnotedthefactors describedbelowinassessingtheindependenceofWTW.

•WTWperformedonlytwodiscreteprojectsforourcompanyin2023outsideoftheexecutivecompensation servicesitperformedfororattherequestoftheCommittee

•Feesfromourcompanyreflectedapproximately0.004%ofWTW’srevenueforitsfiscalyearended December31,2023

•WTWhaspoliciesandprocedurestoensureitsadviceisobjectiveandindependent,includingacomprehensive codeofconductandethicsandqualitypoliciesthatmandaterigorousworkreviewsandperiodiccompliance reviews,whichthefirmhasrepresentedtotheCommitteearehighlyeffective

•BasedondisclosuresfromWTWandmembersoftheCommittee,therearenobusinessorpersonal relationshipsbetweenthem

•NomembersoftheWTWteamservingtheCommitteeownstockinourcompany,otherthanpotentiallythrough investmentsinmutualorotherfundsmanagedwithoutthemember’sinput

•Basedondisclosuresfromthefirmandourexecutiveofficers,therearenobusinessorpersonalrelationships betweenWTWorthemembersoftheengagementteamadvisingtheCommitteewithanyexecutiveofficerof ourcompany

COMPENSATIONCLAWBACKPOLICIES

InOctober2023,ourBoardadoptedaPolicyforRecoveryofErroneouslyAwardedCompensation(“Section16 Clawback”)toimplementrulesissuedbytheSEC.TheSection16Clawbackappliestoourcurrentandformerexecutive officers,includingallNEOs,andsubjectstheirincentive-basedcompensationreceivedonorafterOctober2,2023to clawbackintheeventourcompanyisrequiredtoprepareanaccountingrestatementtocorrectmaterialnoncompliance withanyfinancialreportingrequirementunderU.S.securitieslaws,includingrestatementsthatcorrectanerrorin previouslyissuedfinancialstatementsthat(i)ismaterialtothepreviouslyissuedfinancialstatementsor(ii)wouldresult inamaterialmisstatementiftheerrorwerecorrectedorleftuncorrectedinthecurrentperiod.Inthesecircumstances,the Section16Clawbackrequiresourcompanytorecover,reasonablypromptly,theportionofincentive-basedcompensation thatisdeemedtohavebeenerroneouslyawarded,unlesstheCommittee(whichadministersthepolicy)hasdetermined thatrecoverywouldbeimpracticableandthatoneormoreoftheallowableimpracticabilityconditionsunderSECrules hasbeenmet.Recoveryisrequiredwhetherornottheapplicableofficerengagedinmisconductorotherwisecausedor contributedtotherequirementfortherestatement. Eachofourexecutiveofficers,includingallNEOs,hasagreedtothe termsoftheSection16Clawbackandacknowledgedthattheircompensationmaybesubjecttoreduction, cancellation,forfeitureand/orrecoupmentasrequiredthereby.

AtthetimeitrecommendedtoourBoardtheadoptionoftheSection16Clawback,theCommitteerecommended thatourexistingclawbackpolicyremainineffect.ThisclawbackpolicyapplicabletoallAIPandLTIrecipientsrequires that,intheeventoffraudorotherintentionalmisconductonthepartofanawardeethatnecessitatesarestatementof ourfinancialresults(including,withoutlimitation,anyaccountingrestatementduetomaterialnoncompliancewithany financialreportingrequirement),theCommitteemayrequirethattheawardeereimburseourcompanyforanyAIPorLTI awardspaidorgrantedinexcessoftheamountthatwouldhavebeenpaidorgrantedbasedontherestatedfinancial results. Thismorewidelyapplicableclawbackpolicyhasbeenexpresslyincorporatedintoourannualandlong-term incentiveplansandiscontractuallyagreedtobyLTIrecipients,includingallNEOs,intheirannualawardagreements.

TALENTANDCOMPENSATIONCOMMITTEEREPORT

TheTalentandCompensationCommittee(referredtointhisreportasthe“Committee”)ofourBoardofDirectorshas reviewedanddiscussedtheCompensationDiscussionandAnalysis(CD&A)requiredbyItem402(b)ofRegulationS-K withmanagementand,basedonitsreviewandthosediscussions,hasrecommendedtoourBoardofDirectorsthatthe CD&Abeincludedinour2024proxystatementandincorporatedbyreferenceintoour2023AnnualReport.

TheCommitteewelcomesfeedbackregardingourexecutivecompensationprogram.Stockholdersmaycommunicate withtheCommitteebywritingtotheCompensationCommitteeChair,c/oCorporateSecretary,8080NortonParkway, Mentor,Ohio44060.

JuliaA.Stewart, Chair

BradleyA.AlfordKenC.HicksAndresA.LopezFrancescaReverberi

EXECUTIVECOMPENSATIONTABLES

(1) Amountsincludeanyportionsofsalarycontributedtoouremployeesavingsplanordeferredunderourdeferredcompensationplan.Salaryadjustments,ifany, generallybecomeeffectiveinAprilunlessachangeinroleleadstoanadjustmentatadifferenttimeofyear.

(2) Amountsin2023includethegrantdatefairvalueofPUs,whichareeligibleforvestingattheendofathree-yearperiodprovidedthatthedesignated performanceobjectivesareachievedasoftheendoftheperiod.Thenumberofsharesvestingcanrangefrom0%to200%ofthetargetunitsonthegrantdate. TheperformanceobjectivesthatdeterminethenumberofsharesthatmaybeearnedforthePUsgrantedin2023toCorporateNEOs(Ms.Baker-NelandMessrs. Stander,Butier,LovinsandColisto)are(i)companycumulativeEVA(weighted50%),whichisaperformanceconditionunderAccountingStandardsCodification Topic718, Compensation-StockCompensation (ASC718),and(ii)relativeTSR(weighted50%),comparedtoadesignatedpeergroup,whichisamarket conditionunderASC718,ineachcasecomputedoverthe2023-2025performanceperiod.ForourSolutionsNEO(Mr.Melo),theperformanceobjectivesare SolutionscumulativeEVA(weighted75%)andrelativeTSR(weighted25%),ineachcasecomputedoverthe2023-2025performanceperiod.Thefairvaluesof theperformanceconditioncomponentweredeterminedbasedonthefairmarketvalueofourcommonstockonthegrantdate,adjustedforforegonedividends duringtheperformanceperiod.ThemaximumgrantdatefairvaluesoftheperformanceconditioncomponentofPUswere$992,646,$3,970,585,$827,147, $631,052and$250,335forMessrs.Stander,Butier,Lovins,MeloandColisto,respectively,and$259,722forMs.Baker-Nel.Thefairvaluesofthemarket conditioncomponentweredeterminedusingtheMonte-Carlosimulationmethod,whichutilizesmultipleinputvariablestoestimatetheprobabilityofachieving theperformanceobjectivesestablishedfortheaward,includingtheexpectedvolatilityofourstockpricerelativetothedesignatedpeergroupattheendofthe three-yearperformanceperiodandarisk-freeinterestrateof4.35%derivedfromlinearinterpolationofthetermstructureofTreasuryConstantMaturitiesyield ratesfortheperiod.BasedontheMonte-Carlosimulationmethod,thegrantdatefairvaluesofthemarketconditioncomponentofPUswere105.23%ofour averagestockpriceonthegrantdate.TargetgrantdatefairvaluesofthemarketconditioncomponentofPUswere$524,951,$2,099,994,$437,523,$111,135 and$132,376forMessrs.Stander,Butier,Lovins,MeloandColisto,respectively,and$137,307forMs.Baker-Nel.Maximumgrantdatefairvalueswerethesame astargetgrantdatefairvalues.

Amountsin2023alsoincludethegrantdatefairvalueofMSUs,whichareeligibleforvestingover1-,2-,3-and4-yearperformanceperiodsprovidedthatthe designatedperformanceobjectiveisachievedasoftheendofeachperiod.Thenumberofsharesvestingcanrangefrom0%to200%ofone-quarterofthe targetunitsonthegrantdate.ThesoleperformanceobjectivethatdeterminesthenumberofunitsthatmaybeearnedforMSUsisabsoluteTSR,whichisa marketconditionunderASC718.Thegrantdatefairvaluewas106.82%ofouraveragestockpriceonthegrantdateanddeterminedusingtheMonte-Carlo simulationmethod,whichutilizesmultipleinputvariablestoestimatetheprobabilityofachievingtheperformanceobjectiveestablishedfortheaward,including theexpectedvolatilityofourstockpriceandrisk-freeinterestratesof4.95%,4.58%,4.35%and4.20%forthefirst,second,thirdandfourthMSUtranches, respectively,derivedfromlinearinterpolationofthetermstructureofTreasuryConstantMaturitiesyieldratesfortherespectiveperformanceperiods.Target grantdatefairvaluesofMSUswere$1,050,094,$4,200,125,$875,058,$445,020and$264,816forMessrs.Stander,Butier,Lovins,MeloandColisto, respectively,and$274,604forMs.Baker-Nel.Maximumgrantdatefairvalueswerethesameastargetgrantdatefairvalues.

Amountsin2023forMs.Baker-NelandMessrs.LovinsandColistoalsoincludethegrantdatefairvaluesofRSUs,withoutadjustmentforforfeitures.RSUs awardedtoMr.Lovinscliff-vestonthethirdanniversaryofthegrantdateandRSUsawardedtoMs.Baker-NelandMr.Colistocliff-vestonApril1,2025,ineach casesubjecttotheircontinuedservice.ThefairvaluesoftheseRSUsweredeterminedbasedontheclosingpriceofourcommonstockonthegrantdate, adjustedforforegonedividends.ThegrantdatefairvaluesoftheseRSUswere$578,870,$1,430,732and$192,898,respectively.

(3) Amountin2023forMr.Standerreflectstheaggregategrantdatefairvalueofstockoptions,withoutadjustmentforforfeitures,whichvest50%oneachofthe thirdandfourthanniversariesofthegrantdate,ineachcasesubjecttohiscontinuedservice.Thegrantdatefairvalueofstockoptionswasestimatedusingthe Black-Scholespricingmodel.Forinformationregardingtheassumptionsweusetodeterminegrantdatefairvalue,seeNote12,“Long-TermIncentive Compensation,”totheconsolidatedfinancialstatementscontainedinour2023AnnualReport.

(4) AmountsreflectAIPawardsfortheapplicableyear,whicharedeterminedinFebruaryandpaidinMarchofthefollowingyear.

(5) Thetableshownbelowshowsthecomponentsoftheseamountsfor2023.

(7)

2023GRANTSOFPLAN-BASEDAWARDS

EstimatedFuturePayouts UnderNon-Equity IncentivePlanAwards($)(1)

EstimatedFuturePayouts UnderEquity IncentivePlanAwards(#)(2)

AllOther Stock Awards: Numberof Sharesof Stock

PUs03/01/23–– –2,3434,6869,372––$851,096

RSUs03/01/23–– – –––8,230–$1,430,732

AIPAward–$112,500$562,500$1,125,000––––– –FranciscoMelo

MSUs03/01/23–– –1,9642,3114,622––$445,020 PUs03/01/23–– –1,2012,4014,802––$426,661

AIPAward–$67,445$297,976$595,952––––– –

DeenaBaker-Nel

MSUs03/01/23–– –1,2121,4262,852––$274,604 PUs03/01/23–– – 7361,4712,942––$267,168 RSUs03/01/23–– – –––3,292–$578,870

AIPAward–$49,000$245,000$490,000––––– –NicholasR.Colisto

MSUs03/01/23–– –1,1691,3752,750––$264,816 PUs03/01/23–– – 7091,4182,836––$257,543 RSUs03/01/23–– – –––1,097–$192,898

AIPAward–$45,677$228,385$456,770––––– –

(1) Amountsrepresentthreshold,targetandmaximumopportunitiesunderthe2023AIP.TargetAIPawardsweredeterminedbymultiplyingeachNEO’syear-end basesalarybythefollowingtargetopportunities:95%forMr.Stander;~147%forMr.Butier;75%forMr.Lovins;~58%forMr.Melo;and50%forMs.Baker-Nel andColisto.TargetAIPopportunitiesforMessrs.Stander,ButierandMeloreflectpreviousopportunitiesof75%,160%and50%,respectively,andyear-end opportunitiesof135%,120%and60%,respectively,ineachcaseproratedforthemonthsoftheirserviceintheirrespectiverolesduringtheyear.TheAIPpayout forCorporateNEOs(Ms.Baker-NelandMessrs.Stander,Butier,LovinsandColisto)rangesfromzeroforbelow-thresholdperformance;20%forthreshold performancebasedonathresholdof0%fortheadjustedEPSperformanceobjectiveandathresholdof50%fortheadjustedsalesgrowthandadjustedfreecash flowperformanceobjectives;100%fortargetperformancewithrespecttoeachoftheperformanceobjectives;and200%formaximumperformancewithrespect toeachoftheperformanceobjectives.TheAIPpayoutforourSolutionsNEO(Mr.Melo)rangesfromzeroforbelow-thresholdperformance;22.5%forthreshold performancebasedonthresholdsof0%fortheadjustedEPSandadjustednetincomeperformanceobjectivesand50%fortheadjustedsalesgrowthand adjustedfreecashflowperformanceobjectives;100%fortargetperformancewithrespecttoeachoftheperformanceobjectives;and200%formaximum performancewithrespecttoeachoftheperformanceobjectives.

(2) AmountsforMSUsrepresentthreshold,targetandmaximumopportunities,whicharepaidoutinsharesofourcommonstockover1-,2-,3-and4-year performanceperiodsprovidedthattheabsoluteTSRperformanceobjectiveisachievedasoftheendofeachperiod.Theactualnumberofshareseligiblefor vestingateachvestingdaterangesfrom0%to200%ofone-quarterofthetargetnumberofunitsonthegrantdate,withathresholdpayoutof85%.MSUs accruedividendequivalentsduringtheperformanceperiod,whichareearnedonlyatvesting.

AmountsforPUsrepresentthreshold,targetandmaximumopportunitiesforthe2023-2025PUs,whicharepaidoutinsharesofourcommonstockattheendof thethree-yearperformanceperiodprovidedthattherespectivecumulativeEVAandrelativeTSRperformanceobjectivesareachievedattheendoftheperiod. CumulativeEVAisweighted50%forCorporateNEOs(basedoncompanyEVA)and75%forourSolutionsNEO(basedonsegmentEVA)andrelativeTSRis weighted50%forourCorporateNEOsand25%forourSolutionsNEO.Theactualnumberofshareseligibleforvestingrangesfrom0%to200%ofthetarget numberofunitsonthegrantdate,withapayoutof50%ifthresholdperformanceisachievedwithrespecttoeachoftheperformanceobjectives.

RSUsawardedtoMr.Lovinscliff-vestonthethirdanniversaryofthegrantdateandRSUsawardedtoMs.Baker-NelandMr.Colistocliff-vestonApril1,2025,in eachcasesubjecttotheircontinuedservice.

(3) ThegrantdatefairvaluesofMSUsweredeterminedusingtheMonte-Carlosimulationmethod,whichutilizesmultipleinputvariables,includingexpectedvolatility ofourstockpriceandotherassumptionsappropriatefordeterminingfairvalue,toestimatetheprobabilityofsatisfyingtheperformanceobjectiveestablishedfor theaward.

ThegrantdatefairvaluesfortheperformanceconditioncomponentofPUsweredeterminedbasedonthefairmarketvalueofourcommonstockonthegrant date,adjustedforforegonedividendsduringtheperformanceperiod.ThegrantdatefairvaluesforthemarketconditioncomponentofPUsweredeterminedusing theMonte-Carlosimulationmethoddescribedabove.

ThegrantdatefairvaluesofstockoptionswereestimatedusingtheBlack-Scholesoption-pricingmodel.

ThegrantdatefairvaluesofRSUsweredeterminedbasedonthefairmarketvalueofourcommonstockonthegrantdate,adjustedforforegonedividends. Formoreinformationondeterminationsofgrantdatefairvalues,seefootnote(2)ofthe 2023SummaryCompensationTable. Foradditionalinformationregarding theassumptionsweuseforourstock-basedcompensation,seeNote12,“Long-TermIncentiveCompensation,”totheconsolidatedfinancialstatementscontained inour2023AnnualReport.

– – – 8,391(3) $1,696,324

03/01/23––––––5,523(2) $1,116,530

09/01/23–62,955$190.5409/01/33––––– 62,955

5,862$1,185,06240,359$9,344,037

MitchellR.Butier 06/01/16141,108 –$73.9606/01/26–

02/27/20– – – – 13,214(2) $2,671,342

03/01/21––––––32,243(3) $6,518,245

03/01/21––––––13,949(2) $2,819,930

03/01/22––––––30,477(3) $6,161,230

03/01/22––––––18,823(2) $3,805,258

03/01/23––––––33,566(3) $6,785,702

03/01/23––––––22,093(2)

$665,511 – $665,511

– 789(2) $159,504 03/01/21––––––1,911(3) $386,328 03/01/21––––––828(2) $167,388 03/01/22––––––1,852(3) $374,400 03/01/22––––––1,145(2) $231,473 03/01/23––––––2,116(3) $427,771 03/01/23––––––1,392(2) $281,407 03/01/23––––1,097(4) $221,770 –

(1) Marketvaluecalculatedbasedontheclosingpriceofourcommonstockof$202.16onDecember29,2023,thelasttradingdayofour2023fiscalyear.

(2) MSUsareeligibleforvestingover1-,2-,3-and4-yearperformanceperiods,subjecttoachievementoftheabsoluteTSRperformanceobjective.Amountsareshownat(i) 180%,134%,94%and98%oftargetforthevestingtranchesoftheMSUsgrantedin2020,2021,2022and2023,respectively,thepayoutsbasedonactualperformanceas determinedbytheCompensationCommitteeinFebruary2024;(ii)themaximumlevelofperformancefortheremainingtranchesoftheMSUsgrantedin2021,asactual performancethroughDecember30,2023wouldresultinabove-targetpayouts;and(iii)attargetlevelofperformancefortheremainingtranchesoftheMSUsgrantedin2022 and2023,asactualperformancethroughDecember30,2023wouldresultinbelow-targetpayouts.

(3) PUsareeligibleforvestingattheendofathree-yearperformanceperiod,subjecttoachievementoftherespectivecumulativeEVAandrelativeTSRperformanceobjectives. AmountsreflectthecumulativeEVAcomponentofPUsfortheannualawardof2021-2023PUsat(i)166%oftargetforCorporateNEOs(exceptMessrs.StanderandMelo whoseannualawardof2021-2023PUsweretiedtoSolutionsGroup)and97%oftargetforMessrs.StanderandMelo,ineachcasewhichwerethepayoutsbasedonactual performanceasdeterminedbytheCompensationCommitteeinFebruary2024.AmountforthecumulativeEVAcomponentofthespecialawardof2021-2023PUsgrantedto Mr.Standerreflects166%oftarget,basedonactualperformanceasdeterminedbytheCompensationCommitteeinFebruary2024.AmountsforallNEOsforthe2022-2024 PUsand2023-2025PUsreflectthetargetlevelofperformanceasactualperformancethroughDecember30,2023wouldresultinbelow-targetpayouts.AmountsfortheTSR componentofPUsreflect200%oftargetforthe2021-2023PUsforallNEOswhichwerethepayoutsbasedonactualperformanceasdeterminedbytheCompensation CommitteeinFebruary2024.AmountsforallNEOsforthe2022-2024PUsand2023-2025PUsreflectthemaximumlevelofperformance,asactualperformancethrough December30,2023wouldresultinabove-targetpayouts.

(4) RSUsawardedtoMessrs.StanderandLovinscliff-vestonthethirdanniversaryofthegrantdateandRSUsawardedtoMs.Baker-NelandMr.Colistocliff-vestonApril1, 2025,ineachcasesubjecttotheircontinuedservice.

2023OPTIONEXERCISESANDSTOCKVESTED

ThetablebelowprovidesinformationregardingthenumberofsharesacquiredandthevaluerealizedbyourNEOs uponthevestingofequityawardsduring2023.

(1)

includethepayoutofaccrueddividendequivalents.

2023PENSIONBENEFITS

Thepresentvalueofaccumulatedpensionbenefitsshowninthetablebelowwascalculatedbasedonthe assumptionsweusedtocalculateourpensionbenefitobligationsintheconsolidatedfinancialstatementscontainedin our2023AnnualReport.Amountsshownreflectthelump-sumpresentvalueofthepensionbenefitsaccumulatedasof December30,2023,thelastdayofourfiscalyear.Ms.Baker-NelandMessrs.Stander,MeloandColistoarenotincluded inthetablebecausetheyhavenoaccumulatedpensionbenefits.

GregoryS.Lovins BenefitRestorationPlan15.58$30,454–

(1) TheBenefitRestorationPlanallowsforlump-sumpayment.Forinformationregardingtheassumptionsweusetodeterminethepresentvalueofaccumulated pensionplanbenefits,seeNote6,“PensionandOtherPostretirementBenefits,”totheconsolidatedfinancialstatementscontainedinour2023AnnualReport.

BenefitRestorationPlan

OurBenefitRestorationPlan(BRP)isanonqualifiedexcessbenefitplanthatprovidessupplementalretirement benefitstoeligibleparticipantsinanamountequaltotheamountbywhichtheirbenefitspayableunderourformerU.S. pensionplanwouldhavebeenreducedundertheCode.Messrs.ButierandLovinsareouronlyNEOseligibletoreceive benefitsundertheBRP.Noaccrualsweremadeduring2023astheplanwasfrozenin2010.

CompensationcoveredbytheBRPincludesbasesalaryandAIPawardsthroughthedatetheplanwasfrozen,upto applicablestatutorylimitationseachplanyear.EmployeesvestedintheBRPafterfiveyearsofservice,oratage55upon terminationofemployment.BenefitsundertheBRParebasedonpensionableearnings,lengthofservice,whenbenefits commenceandhowtheyarepaid.Benefitsarecalculatedseparatelyforeachyearofapplicableserviceusingaformula equalto1.25%timescompensationuptothebreakpoint(whichforeachyearpriortoourfreezingtheaccrualof additionalbenefitswastheaverageoftheSocialSecuritywagebasesforthepreceding35years)plus1.75%times compensationinexcessofthebreakpoint.Theresultsofthecalculationforeachyearofserviceareaddedtogetherto determinetheannualsinglelifeannuitybenefitundertheBRPforanemployeeatretirementatage65,whichisnot subjecttoreductionforSocialSecuritypayments.Paymentsaremadeinalump-sumdistributiongenerallypayableupon thelaterofseparationfromserviceandage55,unlessatimelyelectionismadeformonthlypaymentsoverthelifetimeof theparticipantand,ifapplicable,adesignatedbeneficiary.

2023NONQUALIFIEDDEFERREDCOMPENSATION

ThetablebelowprovidesinformationregardingexecutiveandcompanycontributionstoourExecutiveVariable DeferredRetirementPlan(EVDRP)byourU.S.NEOs.UndertheEVDRP,participantsmaychooseamongpublicly availablefundsrangingfrommoneymarketandbondfundstoindexandotherequity/mutualfunds.Theirrateofreturn dependsonthefundstheyselect.Mr.Meloisexcludedfromthetablebecause,asanon-U.S.NEO,heisnoteligibleto participateintheEVDRP.

(1) CompanycontributionstotheEVDRPareincludedintheAllOtherCompensationcolumnofthe 2023SummaryCompensationTable

(2)

above-marketearnings,theyarenotreportedinthe 2023SummaryCompensationTable.TheamountsshownbelowwerereportedintheAllOther Compensationcolumnof

ExecutiveVariableDeferredRetirementPlan

UndertheEVDRP,eligibleU.S.employeescandeferupto75%oftheirsalaryand90%oftheirAIPaward.Deferrals areimmediatelyvested.Earningsarebasedonafixedrateand/ortheperformanceofvariablebondandequityfunds selectedbytheparticipantfromtheavailableoptions. TheEVDRPdoesnotofferinvestmentoptionsthatprovide above-marketinterestrates.

Eligibleemployeesareabletodefertaxesuntiltheirdeferralsarewithdrawn,providingthemanopportunityto accumulatesavingsonapre-taxbasis.Wealsobenefitfromthisarrangementbecausewecanusethiscashforother purposesuntiladeferredcompensationaccountispaidtoaparticipantbasedonhisorherelectiontoreceive withdrawalseitherin-serviceorafterterminationofemployment. Alldeferredcompensationaccountsareunfunded obligationsofourcompanyandsubjecttothesamerisksasanyofourgeneraldebtsandobligations.Asaresult, theseaccountshelpmitigaterisk-seekingbehaviorbymanagementthatcouldbedetrimentaltothelong-termhealth ofourcompany.

Asofthefirstbusinessdayofour2023fiscalyear,wemadeacontributiontothedeferredcompensationaccountsof eligibleparticipants,includingallU.S.NEOs,basedon401(k)eligiblepayinexcessofthefederalcompensationlimitand deferredcompensationin2022.Thisannualcontribution,whichisdesignatedtosupplement401(k)contributionsthat arelimitedundertheCode,providesanautomaticcontributionof3%ofdeferredandeligiblepayplusamatching contributionofupto50%onthefirst7%ofdeferrableandeligiblepaynotcoveredbycompanycontributionstoour 401(k)Plan.

Contributionstodeferredcompensationaccountsarerequiredtobedistributedfollowinganeligibleemployee’s separationfromservice.SubjecttoSection409AoftheCode,eligibleemployeesmayelecttoreceiveseparationfrom servicewithdrawalsintheformofalump-sumpaymentormonthlyinstallmentsovertwoto20years.Eligibleemployees maychangethemethodinwhichpaymentsaredistributedprovidedthattheydosoatleast12monthsbeforethedateof distribution;however,anychangeresultsinthedistributionoccurringorbeginningfiveyearslaterthanitwouldhave otherwise.AllNEOsare“specifiedemployees”underSection409A;asaresult,theirdistributionscannotbemadeuntil sevenmonthsafterseparationfromservice,exceptintheeventofdeath.

PAYMENTSUPONTERMINATIONASOFDECEMBER30,2023

ThetablebelowshowsthepotentialbenefitsthatwouldhavebeenpayabletoourNEOshadtheybeenterminated onDecember30,2023,thelastdayofourfiscalyear.

– $2,688,930

FranciscoMelo

DeenaBaker-Nel

NicholasR.Colisto

– $6,332,258

EliminationofExciseTaxLiability ––––$(1,682,566)

SeverancePayment–––$762,683$762,683

UnvestedRSUs(1) ––––$ 665,511

UnvestedPUs(1)

UnvestedMSUs(1)

$437,676$437,676– – $830,271

$389,982$389,982– – $774,395

Outplacement – – –$25,000$25,000

Total $827,658$827,658–$787,683$3,057,860

ForfeitedEquity(1) $(1,442,518)$(1,442,518)$(2,270,177)$(2,270,177)–

SeverancePayment–––$710,486$710,486

UnvestedRSUs(1) ––––$ 221,770

UnvestedPUs(1)

$376,961$376,961– – $744,960

UnvestedMSUs(1) $350,675$350,675– – $711,814

Outplacement – – –$25,000$25,000

Total $727,636$727,636–$735,486$2,414,030

ForfeitedEquity(1) $(950,907)$(950,907)$(1,678,543)$(1,768,543) –

(1) Valuesforequityawardsweredeterminedasfollows:(i)forstockoptions,thenumberofsharesthatwouldhavebeenexercisablemultipliedbythedifference betweenthefairmarketvalueofourcommonstockof$202.16onDecember29,2023,thelasttradingdayofour2023fiscalyear,andtheapplicableexercise price;and(ii)forRSUs,PUsandMSUs,thenumberofsharesthatwouldhavebeenacquiredorforfeitedonvestingmultipliedby$202.16.

(2) OnlyMr.Standerqualifiedasretirementeligibleattheendoffiscalyear2023becausehehadreachedtheageof55andhadover10yearsofservicewithour company.Asaresult,ineveryterminationscenario,allofhisunvestedequityawardswouldvest,withPUsandMSUsvestingonaproratedbasisaftertheend oftheirrespectiveperformanceperiodbasedonactualperformance.

Intheeventoftermination,oureligibleNEOswouldbeentitledtoreceivetheiraccruedbalanceundertheEVDRP. Theseamountswouldbedistributedinaccordancewiththeparticipant’sdistributionelectionandthetermsand conditionsoftheplan,andarenotincludedinthetable.See 2023NonqualifiedDeferredCompensation formore information.

Theotherpotentialpaymentsuponterminationaredescribedbelow.

ExecutiveSeverancePlan

AllNEOs(excludingMr.Butier,whoceasedbeingeligiblewhenhebecameExecutiveChairmaninSeptember2023) areeligibleparticipantsundertheSeverancePlan.Uponinvoluntaryterminationnotforcause,theywouldbeentitledto thebenefitsshownbelow.

Lump-sumpaymentequaltoannual basesalary+targetAIPawardforyear oftermination+cashvalueof12months ofemployerandemployeemedicaland dentalinsurancepremiums

2 ForCEO

Outplacementservicesofupto $25,000foruptooneyear ×+

1 ForothereligibleNEOs

BenefitsNotSubjecttoGross-up. Benefitsaresubjecttowithholdingforallapplicabletaxesandnotgrossed-upfor taxes.

TriggerforBenefits. Involuntarytermination,whichexcludesterminationforcauseorduetodisability,death, voluntaryresignation,oranexecutivedecliningsimultaneousorcontinuingemploymentinacomparableposition.

DefinitionofCause. Causeisdefinedas(i)commissionofacrimeorotheractthatcouldmateriallydamagethe reputationofourcompanyoritssubsidiaries;(ii)theft,misappropriation,orembezzlementofcompanyorsubsidiary property;(iii)falsificationofcompanyorsubsidiaryrecords;(iv)substantialfailuretocomplywithwrittenpoliciesand procedures;(v)misconduct;or(vi)substantialfailuretoperformmaterialjobdutiesnotcuredwithin30daysafterwritten notice.

KeyExecutiveChangeofControlSeverancePlan

TheCOCSeverancePlanprovidesenhancedseverancebenefitsforkeyexecutivestoincenttheirretentionduringa periodinwhichachangeofcontroltransactionisbeingnegotiatedorahostiletakeoverisbeingattempted.Messrs. Stander,LovinsandMeloareouronlyNEOseligibletoparticipateintheCOCSeverancePlan, whichentitlesthemto benefitsonlyiftheyareterminatednotfor“cause”orterminateemploymentfor“goodreason”within24monthsof thechangeofcontrol(a“doubletrigger”).Inthesecircumstances,theseNEOswouldbeentitledtothebenefitsshown below.Intheeventofterminationfollowingachangeofcontrol,ourLevel3NEOswouldbeentitledtoreceivebenefits undertheSeverancePlandescribedabove.Mr.ButierceasedbeingeligibletoparticipateintheCOCSeverancePlan whenhebecameExecutiveChairmaninSeptember2023.

Lump-sumpaymentequaltoannual basesalary+targetAIPawardforyear oftermination+cashvalueof 12monthsofemployerandemployee medicalanddentalinsurancepremiums

× 3 ForCEO + ProratedtargetAIP awardforyearin whichtermination occurs

+ Outplacement servicesofupto $25,000forupto oneyear 2 ForLevel2NEOs

BenefitsNotSubjecttoGross-up. Benefitsaresubjecttowithholdingforallapplicabletaxesandnotgrossed-up forexciseorothertaxes. However,ifthepaymentwouldtriggeranexcisetax,theparticipatingNEOcanelecttoreceive (i)fullbenefits,retainingresponsibilityforpayinganyapplicableexcisetaxes,or(ii)reducedbenefitstoanamount sufficienttoeliminateanyexcisetaxliability.Inthe2023terminationpaymentstable,COCpaymentswouldonlyhave triggeredanexcisetaxforMessrs.StanderandMelo.

DefinitionofChangeofControl. Changeofcontrolisdefinedas(i)replacementofamajorityofourBoardduringany 12-monthperiodbydirectorswhoseappointmentorelectionwasnotendorsedbyamajorityofthemembersofour Board;or(ii)acquisitionbyanyperson,grouporcorporationthathasenteredintoamerger,acquisition,consolidation, purchase,stockacquisition,assetacquisitionorsimilarbusinesstransactionwithourcompany,of(A)togetherwithany ofourcompany’sstockpreviouslyheld,morethan50%ofthetotalfairmarketvalueorthetotalvotingpowerofour company’sstock;(B)30%ormoreofthetotalvotingpowerofourcompany’sstockduringany12-monthperiod;or (C)assetsofourcompanyhavingatotalgrossfairmarketvalueof40%ormoreofthetotalgrossfairmarketvalueofall ofourcompany’sassetsduringany12-monthperiod.

DefinitionofCause. CauseisdefinedasitisundertheSeverancePlan.

DefinitionofGoodReason. Goodreasonisdefinedas(i)materialdiminutioninbasecompensation;(ii)material diminutioninauthority,dutiesorresponsibilitiesorsupervisor’sauthority,dutiesorresponsibilities;(iii)materialchangein geographicjoblocation;or(iv)anyotheractionorinactionthatconstitutesamaterialbreachbyourcompany.

EquityIncentivePlans

Underour2017IncentiveAwardPlan,unvestedequityawardsheldbyourNEOsonthedateofterminationwould vestasshowninthetablebelow,subjecttotheplan’sone-yearminimumvestingrequirement.Mr.Standerwastheonly NEOwhoqualifiedasretirementeligibleatyear-end2023.

VESTINGOFEQUITYAWARDSONTERMINATIONEVENTS

Resignationor

InvoluntaryTermination, WhetherorNotforCause CancelledCancelledCancelledCancelled

Death

QualifyingDisability

Vestattimeofevent onproratedbasis basedontarget performance

Vestattimeofevent onproratedbasis basedontarget performance

QualifyingRetirement

ChangeofControl

Vestafterendof performanceperiodon proratedbasisbased onactualperformance

Vestbasedonactual, ifdeterminable,and otherwisetarget performanceonlyin eventoftermination withoutcauseorfor goodreasonwithin 24monthsafter changeofcontrol

Vestattimeofevent onproratedbasis basedontarget performance

Vestattimeofevent onproratedbasis basedontarget performance

Vestafterendof performanceperiodon proratedbasisbased onactualperformance

Vestbasedonactual, ifdeterminable,and otherwisetarget performanceonlyin eventoftermination withoutcauseorfor goodreasonwithin 24monthsofchange ofcontrol

VestCancelled

VestCancelled

Vest Vestandexercisable fortermofoption

Vestonlyineventof terminationwithout causeorforgood reasonwithin 24monthsafter changeofcontrol

Vestonlyineventof terminationwithout causeorforgood reasonwithin 24monthsafter changeofcontrol

EQUITYCOMPENSATIONPLANINFORMATIONASOFDECEMBER30,2023

NumberofSecurities toBeIssuedUpon Exerciseof Outstanding Options,Warrants andRights(A)

Weighted-Average ExercisePriceof OutstandingOptions, WarrantsandRights(B)

NumberofSecurities RemainingAvailablefor FutureIssuanceUnder EquityCompensationPlans (ExcludingSecurities ReflectedinColumn(A))(C)

(1) OurAmendedandRestatedStockOptionandIncentivePlanwaslastapprovedbystockholdersinApril2012.WeceasedissuingawardsunderthisplaninMarch 2017.Underthisplan,sharesissuableunderoutstandingequityawardsonlyincludestockoptionsforofficers.Amountincolumn(A)reflects141,108stock options.

(2) Our2017IncentiveAwardPlanwasapprovedbyourstockholdersinApril2017.WebeganissuingawardsunderthisplaninMay2017.Sharesissuableunder outstandingequityawardsgrantedunderthisplaninclude(i)RSUsandDSUsfornon-employeedirectorsand(ii)RSUs,PUsandMSUsforofficersandother eligibleemployees.Amountincolumn(A)includes66,540RSUs,109,702DSUs,238,882MSUs(includingaccrueddividendequivalentsandreflectingthe tranchesgrantedin2021,2022and2023),405,539PUs(reflectingthetranchesgrantedin2021,2022and2023)and62,955stockoptions.Forawardssubject tovestingasofDecember30,2023,payoutswerebasedonactualperformance.ForunvestedawardsasofDecember30,2023,awardswithprojected performanceatorbelowtargetwerecalculatedatthetargetlevelofperformanceandawardswithprojectedperformanceabovetargetwerecalculatedatthe maximumlevelofperformance.Amountincolumn(C)representstheaggregatenumberofsharesavailableforfutureissuance,witheachfull-valueaward decreasingthenumberofsharesavailableforfutureissuanceby1.5shares.

PAYVS.PERFORMANCEDISCLOSURE

ThetablebelowreflectsinformationregardingthecompensationofourNEOsforthelastfourfiscalyears,aswellas ourfinancialperformanceforthosefiscalyears,inaccordancewithSECrules.

Summary

Year

TableTotal forStander ($)(1)

Compensation ActuallyPaid to Stander($)(2)

Summary Compensation TableTotal for Butier($)(1)

Compensation ActuallyPaid toButier($)(2)

Average Summary Compensation TableTotal forNon-CEO NEOs($)(1)

Average Compensation ActuallyPaidto Non-CEO NEOs($)(2)

ValueofInitialFixed$100 InvestmentsBasedon:

Total Stockholder Return($)

PeerGroup Total Stockholder Return($)(3)

FormerPeer GroupTotal Stockholder Return($)(3)

NetIncome($) Adjusted EPS($)(4)

(1) Foreachfiscalyear,representsamountreportedforourCEO(s)andaverageamountreportedforournon-CEONEOs,ineachcaseintheTotalcolumnofthe SummaryCompensationTable.OurNEOsforeachofthesefiscalyearsareshownbelow.

Year CEO(s)

Non-CEONEOs

2023DeonStander/MitchellButierGregoryLovins,FranciscoMelo,DeenaBaker-NelandNicholasColisto

2022MitchellButier DeonStander,GregoryLovins,DeenaBaker-NelandIgnacioWalker

2021MitchellButier DeonStander,GregoryLovins,DeenaBaker-NelandIgnacioWalker

2020MitchellButier DeonStander,GregoryLovins,AnneHillandSusanMiller

(2) AmountsrepresentCompensationActuallyPaidtoourCEO(s)andtheaverageCompensationActuallyPaidtoournon-CEONEOsfortherelevantfiscalyear. CompensationActuallyPaidrepresentstheamountreportedintheTotalcolumnoftheSummaryCompensationTablefortheapplicablefiscalyear.For2023, amountswereadjustedasshownbelow.Fairvalueorchangeinfairvalue,asapplicable,ofequityawardsintheCompensationActuallyPaidcolumnswas determinedasfollows:(i)forRSUs,theclosingpriceofourcommonstockonthefiscalyear-enddate,or,inthecaseofvestingRSUs,theclosingpriceofour commonstockontheapplicablevestingdate;(ii)fortheperformanceconditioncomponentofPUs,thesamevaluationmethodologyasRSUsexceptthatyear-end valuesweremultipliedbyafactorreflectingachievementoftheprobableoutcomeoftherespectivecumulativeEVAperformanceobjectiveasoftheapplicable measurementdate;and(iii)forthemarketconditioncomponentofPUsandforMSUs,usingtheMonte-Carlosimulationmethod,whichutilizesmultipleinput variables,includingexpectedvolatilityofourstockpriceandotherassumptionsappropriatefordeterminingfairvaluetoestimatetheprobabilityofachievingthe respectiveperformanceobjectiveasoftheapplicablemeasurementdate.ForinformationontheinputstoourMonte-Carlosimulations,seethefootnotesofour 2023SummaryCompensationTable.Forthesepurposes,awardsforretirement-eligibleNEOsareconsideredvestedonlyatthetimeofretirement.

IncreasebasedonASC718fairvalueofawardsgrantedduringfiscalyear2023thatremainedunvestedasof fiscalyear-end2023,determinedasoffiscalyear-end2023

IncreasebasedonASC718fairvalueofawardsgrantedduringfiscalyear2023thatvestedduringfiscalyear, determinedasofvestingdate

Increase/Decreaseforawardsgrantedduringpriorfiscalyearsthatwereoutstandingandunvestedasoffiscal year-end2023,determinedbasedonchangeinASC718fairvaluefrompriorfiscalyear-endtofiscalyear-end 2023 (354,708)(1,784,812)(2,025,711)

Increase/Decreaseforawardsgrantedduringpriorfiscalyearsthatvestedduringfiscalyear2023,determined basedonchangeinASC718fairvaluefrompriorfiscalyear-endtovestingdate

DecreaseforchangeintheactuarialpresentvaluesreportedunderChangeinPensionValueandNQDCEarnings columnof2023SummaryCompensationTable –(5,812)(205)

Increaseforservicecostand,ifapplicable,priorservicecost,forpensionplans–––

(3) In2023,wemodifiedourpeergrouptoshowourrelativeperformancemoreconsistentwiththemethodologyusedbypeercompanies.Fortherelevantfiscalyear, representsthecumulativeTSRoftheDowJonesU.S.Containers&PackagingIndex(the“PeerGroup”),ofwhichweareamember.Ourformerpeergroup(the “FormerPeerGroup”),whichrepresentsthecumulativeTSRoftheaveragereturn(weightedbymarketcapitalization)oftheS&P500IndustrialsandMaterials subsets,isalsopresentedinaccordancewithSECguidance.

(4) AdjustedEPSisanon-GAAPfinancialmeasurereconciledfromGAAPinAppendixAofthisproxystatement.

RelationshipBetweenFinancialPerformanceMeasures

ThegraphsbelowcomparetheCompensationActuallyPaidtoourCEO(s)andtheaverageoftheCompensation ActuallyPaidtoournon-CEONEOswithour(i)TSR,PeerGroupTSRandFormerPeerGroupTSR,(ii)netincomeand (iii)adjustedEPS,ineachcaseforour2020,2021,2022and2023fiscalyears.TSRamountsassume$100investedon December31,2020andreinvestmentofdividends.

ReflectingtheCompensationCommittee’sphilosophyofpayingforperformanceandincentingourexecutives usinglong-termequityawardsprimarilytiedtoourstockpriceandTSR,theCompensationActuallyPaidtoour NEOswasgenerallyalignedwithourTSRperformance. In2020and2021,asourTSRsignificantlygrew,the CompensationActuallyPaidtoourCEOandnon-CEONEOsalsoincreased.In2022,whenourTSRdecreased,the CompensationActuallyPaidalsodecreased.WhileourTSRmodestlyincreasedin2023andtheCompensationActually PaidtoMr.Butierincreasedaswell,theaverageCompensationActuallyPaidtoournon-CEONEOssubstantially decreasedduetotheimpactoftheadjustmentsshowninfootnote(2)above.Webelievethattheinclusionofboth absoluteandrelativeTSRasperformanceobjectivesinourannualLTIawardstoNEOs,whichcomprisesthemajorityof theircompensation,ensuresongoingalignmentofCompensationActuallyPaidtoourTSRperformance.

Thegrowthinournetincomefrom2020through2022didnotdirectlyalignwithCompensationActuallyPaid.In eachofthosethreeyears,ournetincomegrew;however,ourCompensationActuallyPaidvariedovertheperiod.Net incomedeclinedin2023,whileCompensationActuallyPaidtoMr.ButierincreasedandCompensationActuallyPaidto ournon-CEONEOssubstantiallydecreasedduetotheimpactoftheadjustmentsshowninfootnote(2)above. CompensationActuallyPaidislesssensitivetonetincomebecauseourexecutivecompensationprogramprioritizes longer-termequitycompensationprimarilytiedtoourstockpriceandTSRandsecondarilytocumulativeEVA,eachof whichweexpectwillcontinuetohaveamuchgreaterimpactthannetincomeonCompensationActuallyPaid.

OutsideofourTSRperformance,webelievethatadjustedEPSisthemostimportantfinancialmeasurethattiesthe compensationofNEOstoourperformance.AdjustedEPSistheprimarydriverofstockholdervaluecreation;itisalsothe measureweusetoprovideguidancetoourinvestorsonouranticipatedannualperformance.Despitetheimportanceof adjustedEPSasaperformanceobjectiveunderourannualincentivecompensationprogram,theimpactofadjustedEPS onCompensationActuallyPaidismoderatedbythemuchstrongercorrelationCompensationActuallyPaidhaswithour stockpriceandTSRperformanceasaresultoftheemphasisinourexecutivecompensationprogramonlonger-term equityawards.

Payvs.PerformanceFinancialPerformanceMeasures

Webelievethefinancialperformancemeasuresshownbelow,allofwhichareperformanceobjectivesusedinour executivecompensationprogram,werethemostimportantinlinkingCompensationActuallyPaidtoourNEOsfor2023. Foradditionalinformationregardingthesemeasures,includingreconciliationsofnon-GAAPfinancialmeasuresfrom GAAP,seethe CompensationandDiscussionAnalysis andAppendixAsectionsofthisproxystatement.

•AbsoluteTSRandRelativeTSR

•AdjustedEPS

•CumulativeEVA

•AdjustedSalesGrowth

•AdjustedFreeCashFlow

CEOPAYRATIO

With~69%ofour2023revenuesoriginatingoutsidetheU.S.and~40%ofourrevenuesoriginatinginemerging markets(AsiaPacific,LatinAmerica,EasternEuropeandMiddleEast/NorthernAfrica),ouremployeesarelocatedinmore than50countriestobestserveourcustomers.Atyear-end2023,~83%ofouremployeeswerelocatedoutsidetheU.S. and~66%werelocatedinemergingmarkets,wheremediancompensationissubstantiallylowerthanitisintheU.S.

Thechartsbelowshowthedemographicsofourglobalworkforcebyregionandfunction.Atyear-end2023,~20,000 ofouremployeeswereinAsiaPacific,servingourcustomersintheregion.Inaddition,~22,500employeesatthattime workedintheoperationsofourmanufacturingfacilitiesorinpositionsdirectlysupportingthemfromotherlocations.

by Region

Workforce by Function

Weoffermarket-based,competitivewagesandbenefitsinthemarketswherewecompetefortalent.Allofour employeeswerepaidatleasttheapplicablelegalminimumwage,andover98%ofouremployeeswerepaid above the applicablelegalminimumwageatyear-end2023.

EffectiveSeptember2023,Mr.StanderwasappointedasournewCEO.InaccordancewithSECrules,wehave annualizedMr.Stander’scompensationforpurposesofcalculatingourCEOpayratio.

2023PAYRATIO

•The2023totalcompensationofourmedianemployee(amongallemployeesexceptouryear-endCEO)was $15,679.

•Thecompensationofouryear-endCEOof$6,070,962,asreportedintheTotalcolumnofthe2023 Summary CompensationTable,wasadjustedtoannualizehisbasesalaryto$1.1million,resultingintotalcompensationof $6,323,731.

•Basedonthisinformation,areasonableestimateofthe2023ratiooftheannualtotalcompensationofourCEO totheannualtotalcompensationofourmedianemployeewasapproximately403to1.

WecalculatedthisratiobasedonSECrulesandguidance,whichallowforcompaniestousevaryingmethodologies toidentifytheirmedianemployee.Othercompaniesmayhavedifferentworkforcedemographicsandemploymentand compensationpracticesandmayutilizedifferentmethodologies,exclusions,estimatesandassumptions.Asaresult,their CEOpayratiosmaynotmeaningfullycomparetoours.

IDENTIFICATIONOFMEDIANEMPLOYEE

Duetochangesinourglobalworkforcefromprioryear,wedeterminedanewmedianemployeeforpurposesof calculatingour2023CEOpayratio.Consistentwithourpriorpractice,toidentifyourmedianemployee,weconsidered annualbasecompensation,whichistheprincipalcompensationelementforthevastmajorityofouremployees globally.Wemeasuredcompensationforpurposesofdeterminingthemedianemployeeusingthe12-monthperiod endedDecember31,2023,makingnocost-of-livingadjustments.

WeselectedDecember19,2023asthedateonwhichtodetermineourmedianemployee.Asofthatdate,wehad 34,472employees,28,743ofwhichwerelocatedoutsidetheU.S.and22,751ofwhichwerelocatedinemerging markets.Weutilizedthedeminimisexemptiontoexcludethefollowingcountriesrepresentingnomorethan5%ofour 92 2024ProxyStatement | AveryDennisonCorporation

globalpopulationintheaggregate:Kenya(15employees),Mauritius(18employees),Pakistan(345employees), Indonesia(473employees)andSriLanka(523employees),representingapproximately0.04%,0.05%,1.0%,1.37%and 1.52%,respectively,ofourglobalworkforceatthattime.

Todetermineourmedianablegroup,weusedastatisticalsamplingapproachknownasstratifiedsamplingto concentrateonmedianableemployees,whichwerethosewithinanarrowrangeoftheestimatedmedianannualsalaryof $13,017,becausetheseemployeeswereallreasonablylikelytobeourmedianemployee.Weidentified405employees withanannualsalarywithin$500ofthisamount.BecauseemployeesfromChinarepresentedapproximately46%ofthe medianablegroup,wenarrowedthemedianablegrouptothose185employees.Finally,weidentifiedthesixemployees whohadthepotentialtobeourmedianemployeebyanalyzingadditionalqualitativeandquantitativecharacteristics, includingpayvolatility.

MEDIANEMPLOYEECOMPENSATION

Ourmedianemployeewasafull-time,salariedemployeeworkingatamanufacturingfacilityinChina,withannual basecompensationof$12,960.Forpurposesofthisdisclosure,weconvertedtheemployee’sannualbasecompensation fromChineseYuantoU.S.dollarsusingtheaveragemonthlyexchangerateduring2023of0.14128373.

Indeterminingtheannualtotalcompensationof$15,679forourmedianemployee,wecalculatedtheemployee’s compensationconsistentwithhowwedeterminedourCEO’stotalcompensationforthe 2023SummaryCompensation Table

ITEM3–APPROVALOFCERTIFICATEOFAMENDMENTTOOUR AMENDEDANDRESTATEDCERTIFICATEOFINCORPORATION

AftercarefulconsiderationandupontherecommendationoftheGovernanceCommittee,ourBoardhasdeterminedit tobeadvisableandhasapproved,andrecommendsthatourstockholdersapproveattheAnnualMeeting,aCertificateof Amendment(the“CharterAmendment”)toourAmendedandRestatedCertificateofIncorporation(“Charter”)toprovide stockholdersofrecordholding,intheaggregate,atleast25%ofthevotingpowerofouroutstandingcommonstockthe righttorequestthatourCorporateSecretarycallspecialmeetingsofstockholders.IfstockholdersapprovetheCharter Amendment,whichisdescribedbelowandincludedinitsentiretyinAppendixBofthisproxystatement,ourBoardwill amendourBylawstospecifythenotice,informationandotherrequirementsforstockholderstorequestthatour CorporateSecretarycallaspecialmeetingofstockholdersthatwillbecomeeffectiveupontheeffectivenessofthe CharterAmendment.

PursuanttoourCharter,stockholderscurrentlydonothavetherighttorequestthatwecallspecialmeetingsof stockholders. Basedonitsongoingreviewofourgovernanceprogramandthefeedbackreceivedduringour2023 engagementswithinvestors,theGovernanceCommitteeandourBoardhaverecognizedthatprovidingstockholders withtheabilitytorequestthatspecialmeetingsbecalledisconsideredbyvariousstakeholderstobeanimportant elementofastronggovernanceprogram. OurBoardconsidersspecialmeetingstobeextraordinaryeventsthatshould beheldonlywhensignificantstrategicconcernsorothersimilarconsiderationsrequirethatthematterstobeaddressed notbedelayeduntilournextAnnualMeeting.Ourinvestorrelationsandstockholderengagementprogramsprovide forumsinwhichstockholdersmaycommunicatedirectlywithourBoardandmembersofmanagementthroughoutthe yearontopicsofinteresttothem.

Becausespecialmeetingswouldbeexpensiveandtime-consumingforourcompanyandpotentiallydisruptour normalbusinessoperations,ourBoardbelievesthatasmallpercentageofstockholdersshouldnotbeentitledtorequest thatspecialmeetingsbecalledfortheirowninterests,whichmaynotbesharedbythemajorityofourstockholders.To betterinformourBoard’srecommendation, weconsideredfeedbackfromourinvestors,andwhiletheyexpresseda varietyofpreferencesandthresholdseitherduringengagementorintheirpublishedpolicies,wefoundbroad supportfora25%minimumownershipthresholdforstockholderstobeabletorequestthatspecialmeetingsbe called.OurBoardbelievesthatthisthresholdisappropriateasitwouldprovidestockholderswithameaningfulrightto requestthataspecialmeetingbecalledwhilemitigatingtheriskthatcompanyresourcesareexpendedtoservethe narrowself-interestsofafewminoritystockholders.

TheCharterAmendmentmakesonlyoneadditionalchange,whichistoremoveout-of-datereferencestothe declassificationofourBoardthathadbeenfullyimplementedbyApril2014,providingthatdirectorsshallbeelected annuallyforone-yearterms,consistentwithexistingCharterprovisionsandbestpractices.

Inlightoftheseconsiderations, ourBoardbelievesthattheadoptionofarightforstockholderstorequestthata specialmeetingbecalledassetforthintheCharterAmendmentestablishestheappropriatebalancebetween enhancingstockholderrightsandprotectingstockholderinterests.

BoardRecommendation

OurBoardrecommendsthatyouvoteFORaCertificateofAmendmenttoour AmendedandRestatedCertificateofIncorporationtoprovidethatstockholdersholdingatleast25% ofourcommonstockhavetherighttorequestthatwecallspecialmeetingsofstockholders.

Properlydatedandsignedproxieswillbesovotedunlessyouspecifyotherwise.

CompleteTextofProposedCharterAmendment

Theforegoingdescriptionisqualifiedinitsentiretybyreferenceto,andshouldbereadinconjunctionwith,thefull textoftheproposedCharterAmendmentattachedtothisproxystatementasAppendixB.

ConformingChangestotheBylaws

IftheCharterAmendmentisapprovedbystockholdersattheAnnualMeeting,ourBoardwillamendourBylawsto specifytheproceduralandrelatedrequirementsforstockholder-requestedspecialmeetings.Theseprocedural amendmentsareintendedtoensurethatourcompanyandstockholdersreceiveappropriateinformationaboutthespecial meetingandthatthespecialmeetingisnotduplicativeofmattersthatwere,orintheneartermcouldbe,coveredatan AnnualMeeting.AsummaryoftheplannedamendmentstoourBylawsissetforthbelow.

• OwnershipProvisions.Wewillberequiredtocallaspecialmeetingofstockholdersuponthewrittenrequestof oneormorestockholdersofrecordwho“own”(asdefinedinourBylaws)sharesrepresentingatleast25%of thevotingpowerofouroutstandingcommonstock.Multiplespecialmeetingrequestswillbeconsidered togetherforpurposesofthe25%ownershipthresholdiftheyidentifysubstantiallythesamepurposeandare datedanddeliveredtoourCorporateSecretarywithin60daysofthefirstdateonwhichaspecialmeeting requestwasproperlydeliveredtoourcompany.

• InformationProvisions.Thespecialmeetingrequestmustinclude,amongotherthings,certaininformation, statements,representations,agreementsandotherdocumentsassetforthinourBylaws,includingsuchitems aswouldberequirediftheproponentwereseekingtonominatedirectorsorproposeotherbusinessatan AnnualMeetingundertheadvancenoticeprovisionsofourBylaws.Thisisintendedtoprovideourcompanyand stockholderswiththesameinformationaboutmattersthatastockholderseekstopresentforstockholdervote, whetherthestockholderisusingtheadvancenoticeprocessorrequestingthataspecialmeetingbecalled.

• AdditionalProvisions. Aspecialmeetingwouldberequiredtobeheldnotmorethan90daysafterwereceivea validspecialmeetingrequestatsuchtime,dateandplace,ifany,asdeterminedbyourBoard.Theamendments toourBylawswillsetforthcertainproceduralrequirementsthatourBoardbelievesareappropriatetoavoid duplicativeorunnecessaryspecialmeetings.Undertheseprovisions,aspecialmeetingrequestwouldnotbe validif:

O ItdoesnotcomplywiththerequirementspertainingtospecialmeetingrequestssetforthinourBylaws

O Itrelatestoanitemofbusinessthatisnotthepropersubjectofstockholderactionunderapplicablelaws

O Itisdeliveredduringtheperiodcommencing90dayspriortothefirstanniversaryofthedateofthe immediatelyprecedingAnnualMeetingandendingonthedateofthenextAnnualMeeting

O Anidenticalorsubstantiallysimilaritem(a“SimilarItem”),otherthantheelectionofdirectors,was presentedatanannualorspecialmeetingofstockholdersheldnotmorethan12monthsbeforethespecial meetingrequestisdelivered

O ASimilarItemwaspresentedatanannualorspecialmeetingofstockholdersheldnotmorethan90days beforethespecialmeetingrequestisdelivered

O ASimilarItemisincludedinourcompany’snoticeofmeetingasanitemofbusinesstobebroughtbeforean annualorspecialmeetingofstockholdersthathasbeencalledbutnotyetheldorthatiscalledforadate within90daysofthereceiptbyourcompanyofthespecialmeetingrequest

O ThespecialmeetingrequestwasmadeinamannerthatviolatedRegulation14AundertheSecurities ExchangeActof1934(asamended,the“ExchangeAct”)(asdefinedinSection12)orotherapplicablelaws

TheamendmentstoourBylawswillspecifythatthebusinesstobetransactedatastockholder-requestedspecial meetingwillbelimitedtothebusinessstatedinavalidspecialmeetingrequestandanyadditionalbusinessthatour Boarddeterminestoincludeinthenoticeforthespecialmeeting.

ITEM4–RATIFICATIONOFAPPOINTMENTOF INDEPENDENTREGISTEREDPUBLICACCOUNTINGFIRM

TheAuditCommittee–whichisdirectlyresponsiblefortheappointment,compensation(includingapprovalofaudit andnon-auditfees)andevaluationoftheindependentregisteredpublicaccountingfirmthatauditsourfinancial statementsandinternalcontroloverfinancialreporting–hasappointedPricewaterhouseCoopersLLP(PwC)asour independentregisteredpublicaccountingfirmforfiscalyear2024andourBoardisseekingstockholderratificationofthe appointment.

StockholderratificationisnotrequiredbyourBylawsorapplicablelawsandregulations.However,ourBoard annuallysubmitstheappointmentforstockholderratificationaspartofourstronggovernanceprogram.Ifstockholders werenottoratifytheappointment,theAuditCommitteewouldreconsiderwhetherornottoretainPwC,butcould determinetodosoinitsdiscretion.Inaddition,eveniftheappointmentisratified,theAuditCommitteecould subsequentlyappointadifferentindependentregisteredpublicaccountingfirmwithoutstockholderratificationatthat timeifthecommitteeweretodeterminethatdoingsowasinthebestinterestsofourcompanyandstockholders.

RepresentativesofPwCwillbeavailableduringtheAnnualMeetingtoanswerquestionsfromstockholders.

AuditCommitteeEvaluation

IndeterminingwhethertoreappointPwC,theAuditCommitteeconsideredthefirm’squalifications,performance, independenceandtenure,aswellastheperformanceoftheauditengagementteamservingourcompany;thequalityof itsdiscussionswithPwC;andthefeeschargedbyPwCforthequalityandscopeofservicesprovided.Inconnectionwith the2024appointment,theAuditCommitteeconsidered,amongotherthings,thefactorsdescribedbelow.

• AuditQuality –ThequalityofPwC’sauditandnon-auditworkbasedonitsoversightofitsworkproduct, consideringthefirm’s(i)compliancewithaccounting,auditingandregulatoryrequirements;(ii)understandingof ourbusinessesandthefinancialenvironmentsinwhichweoperate;(iii)identificationandresolutionofissuesina timelymanner;and(iv)integrity,objectivityandprofessionalskepticisminperformingouraudits,aswellasits 2023AuditQualityReportpresentedtotheAuditCommitteeinFebruary2024

• Performance –PwC’seffectivenessduringitsprior-yearaudits,notingthefirm’sagilityandstrongperformance in2023,aswellasitsengagementofsubjectmatterexpertsfromthefirmtodeliveradditionalvalue

• QualitativeReview –TheresultsofoursurveyofmembersofmanagementandtheAuditCommitteeevaluating PwC’s(i)expertiseandresources;(ii)qualityandtimelinessofauditplanning;(iii)communicationandinteraction; (iv)independence,objectivityandprofessionalskepticism;and(v)valuefromfees,notingidentifiedstrengthsand accomplishedimprovements,aswellassuggestionsforfurtherimprovementacrossthesurveyedcategories

• Self-Assessment –PwC’sself-assessmentofitsperformanceanditssatisfactionoftheserviceneedsand expectationsoftheAuditCommitteeandmanagementduringthe2023audit

• RegulatoryReviews –ExternaldataonPwC’sauditqualityandperformance,includingthemostrecentPublic CompanyAccountingOversightBoard(PCAOB)reportonthefirmprovidedtotheAuditCommitteeinJanuary 2024

• Fees –ThereasonablenessofPwC’sfeesforauditandnon-auditservices,bothonanabsolutebasisandrelative topeerfirms,includingmanagement’sbenchmarkingofourauditfeesrelativetothoseofpeercompanies,the keydriversofvariancesandthefirm’stargetedareasofincreasedproductivity

• Independence –PwC’sprocessestoensureitmaintainsindependence,includingrequiredindependencetraining forallpartnersandstaffandglobaldeploymentofanindependencemonitoringsystemfortheirpersonal affiliations;writtendisclosuresfromthefirm;andtheindependenceletterrequiredbythePCAOB

• Tenure –PwC’stenureasourindependentauditor,reflectingonthefeedbackfromcertainofourinvestors counterbalancedagainstthebenefitsofhavingalonger-tenuredauditor,aswellasthecontrolstheAudit CommitteeandPwChaveinplacetomitigatepotentialindependencerisk. In2022,theAuditCommittee deliberatedonconductingaformalprocesstoconsidertheselectionofanewindependentauditor, determiningnottodosogivenitscontinuedoverallsatisfactionwithPwC’seffectivenessandperformance; ourmultipleengagementsofotherregisteredpublicaccountingfirmstoperformvariousnon-auditservices forourcompany,whichcouldimpairtheirindependenceandlimittheirabilitytoserveasourindependent registeredpublicaccountingfirm;theCommittee’sadherencetoregularrotationofPwC’sleadengagement 96 2024ProxyStatement | AveryDennisonCorporation

partnerandleadrelationshippartner;andpotentialriskstoauditqualityandtimeliness.In2023,itnoted thatanewleadrelationshippartnerbeganworkingwiththeAuditCommitteein2022andanewlead engagementpartnerwouldbeginoverseeingtheauditin2024,ineachcasebringingfreshperspective.

TheAuditCommitteehasdeterminedthattheappointmentofPwCisinthebestinterestofourcompanyand stockholders.TheAuditCommitteehasappointedPwCasourindependentregisteredpublicaccountingfirmfor fiscalyear2024andourBoardrecommendsthatstockholdersratifytheappointment.

BoardRecommendation

OurBoardrecommendsthatyouvoteFORratificationoftheappointmentofPwC asourindependentregisteredpublicaccountingfirmforfiscalyear2024.

Properlydatedandsignedproxieswillbesovotedunlessyouspecifyotherwise.

AUDITMATTERS

AUDITORTENURE

PwChasbeenourindependentregisteredpublicaccountingfirmsince1998andservedinthatcapacityduringfiscal year2023.Throughitspredecessorentities,thefirmhasservedasourindependentauditorsinceatleast1954basedon recordswehavebeenabletolocate;wehavebeenunabletodeterminetheexactyearPwCbeganservingasour independentauditor.PwCiswell-qualifiedtocontinueservingasourindependentregisteredpublicaccountingfirm, understandsouroperationsandaccountingpractices,andmaintainsrigorousprocedurestoensureauditor independence,whicharediscussedwithandevaluatedbytheAuditCommittee.Afewofourinvestorshavesuggested that,becauselongertenureposesarisktoauditorindependence,theAuditCommitteeshouldconsiderappointinga differentfirm.Aftergivingtheseviewsdueconsideration,theAuditCommitteemostrecentlydeterminednotto undertakeaformalprocesstopotentiallyselectanewfirmin2022.ThecommitteedeterminedtoreappointPwCfor 2024becauseitcontinuestobelievethatPwCprovides,high-qualityauditservicesonthescaleandwiththe effectivenessandindependencethecommitteerequires,givingconsiderationtothefactorsshownbelow.

• AuditQualityandPerformance –PwChasdeepinstitutionalknowledgeregardingouroperations,businesses, andaccountingpoliciesandpractices,andoptimizesitspeopleandtechnologytodeliverqualityassurance servicesandconsistentlyimproveitsperformance

• Scale –PwChasaglobalpresencewithresourcesinvirtuallyallofthecountriesinwhichwedobusiness, enablingthefirmtoperformstatutoryauditworkonoursubsidiaryaccounts

• Capability –PwC’scapabilityandexperienceunderstandingthebreadthandcomplexityofourglobaloperations

• FreshPerspective –Theappointmentsofanewleadengagementpartnerforthe2024auditandanewlead relationshippartnerin2022,eachofwhombringsfreshperspective

• Efficiency –PwCbringscustomizedknowledgeusingjudgmenttailoredtoouraudits,allowingforsignificant timesavings

• Cost-Effectiveness –PwC’sabilitytocost-effectivelyperformaudit,audit-related,taxcompliance,taxplanning andotherservices

Inconductingitsregularreviewofwhethertoappointanewindependentregisteredpublicaccountingfirm,among otherthings,theAuditCommitteeconsidersthefactthatonboardinganewfirmwouldrequireasignificanttime commitmentonthepartofmanagement,potentiallydistractingfromtheparamountfocusonfinancialreportingand internalcontrols,withoutnecessarilyincreasingauditquality.

TheAuditCommitteerecognizedPwC’suseofdigitaltoolstoimproveefficienciesintheareasofbusiness performanceanalyticsandauditingoftheconsolidationprocess,aswellastheexpandeduseofitstoolforgathering andmanagingauditrequests.Inaddition,PwChascontinuedtoimproveutilizationofitsglobaldeliverablemodelto manageservicedeliverycost,drivestandardizationandexecuteaqualityaudit.

PwCcontinuouslyprovidestheAuditCommitteeandmanagementwithaccounting/financialreportinginsights andbestpracticesrelevanttoourbusiness,aswellasadvancenoticeoflegislativeandregulatorydevelopmentsthat couldhaveasignificantimpactonourcompany.

TheAuditCommitteehasseveralcontrolsinplacetomitigateanypotentialindependenceriskrelatedtoauditor tenure,includingthosedescribedbelow.

• AnnualReviewofPerformanceandIndependence –Inadditiontoitsongoingassessmentandfeedback providedtoPwC,theAuditCommitteeevaluatesthefirm’sperformanceandindependence,aswellasother factorssuchasauditortenure,indeterminingwhetherornottoreappointthefirmforthefollowingyear

• LimitsonNon-AuditServices –TheAuditCommitteeassessestheimpactprovidingnon-auditservicesmay haveonPwC’sindependenceeachtimeitapprovesthefirm’sprovisionoftheseservices,aswellasduringits annualassessmentofthefirm’sindependence;ourcompanyregularlyusesotherindependentregisteredpublic accountingfirmstoprovidenon-auditservices,engagingPwConlyifpermissibleandwheredoingsoconfers significantbenefitsgivenitsroleasourindependentauditor

• RegularConsiderationofAuditorRotation –TheAuditCommitteeregularlyconsiderswhethertochangethe independentregisteredpublicaccountingfirmbasedonitsassessmentofPwC’sauditquality,performance, compensation,independenceandtenure,havingmostrecentlydonesoin2022

• ExecutiveSessions –TheAuditCommitteemeetsregularlybothwithPwCwithoutmanagementpresentand withmanagementwithoutPwCpresent

• LeadEngagementPartnerRotationandSelection –Anewleadengagementpartnerisdesignatedatleast everyfiveyears,withthecurrentpartnerhavingbeendesignatedinadvanceofthe2019audit. TheAudit Committeebegandiscussionswiththefirmregardingthenextleadengagementpartnerinmid-2022and hasselectedtheindividualwhowillbeginleadingtheauditin2024. Inbothcases,theAuditCommittee interviewedthepartnerpriortohisdesignation,andtheAuditCommitteewasdirectlyresponsibleformaking theselection,inconsultationwithmanagementandrepresentativesfromPwC.

• OversightbyLeadRelationshipPartner –PwCdesignatesaseparateleadrelationshippartnertoprovide additionalassuranceandobjectiveoversight;thispartnermeetsatleastannuallywiththeAuditCommitteeand isavailableasneededtoresolveanyissuesthatmayarise.Anewleadrelationshippartnerwasdesignatedin 2022,havingbeenselectedbytheAuditCommitteeinconsultationwithPwCleadership. Thisadditional oversightandescalationpointtoaddressissuesthatmayarisestrengthenstheindependenceoftheaudit engagementteamandhelpsensurecontinuousimprovementinservicequality.

AUDITORINDEPENDENCE

PwChasadvisedusthatneitherthefirmnoranymemberthereofhasanyfinancialinterest,directorindirect,inour companyoroursubsidiaries,confirmingtotheAuditCommitteethatitisincompliancewiththerules,standardsand policiesofthePCAOBandtheregulationsoftheSECgoverningauditorindependence.InFebruary2024,theAudit Committeereviewedthenon-auditservicesprovidedbyPwCduring2023,includingtherelatedfeesassociatedwith previouslypre-approvedservices,inassessingwhetherthefirm’sprovisionoftheseservicesimpairedPwC’s independence.

TheAuditCommitteediscussedwithPwCitsindependencefromourcompany,Boardandmanagementand concludedthatPwCwasindependentduring2023.

AUDITORCOMPENSATION

InapprovingPwC’sservicesandfees,theAuditCommitteeconsiderswhetherPwCisbestpositionedtoprovidethe serviceseffectivelyandefficientlyduetoitsfamiliaritywithouroperations,businesses,accountingpoliciesandpractices, internalcontrols,andfinancialandinformationtechnologysystems,aswellaswhethertheservicesenhanceourabilityto managecontrolrisksandmaintainauditquality.TheAuditCommitteeregularlyreceivesupdatesontheservicesprovided by,andfeespaidto,PwCtoensurethattheyarewithintheparametersapprovedbytheAuditCommittee;intheevent thatfeesareexpectedtoexceedwhatwaspre-approvedbytheAuditCommitteeatthebeginningoftheaudit,additional committeeapprovalisrequired.

COMMITTEEAPPROVALOFSERVICESANDFEES

TheAuditCommitteehasadoptedproceduresforthepre-approvalofallauditandnon-auditservicesandfees providedbytheindependentregisteredpublicaccountingfirm.Inthefourthquarterof2022,theAuditCommittee approvedthe(i)audit,audit-relatedandotherservicesPwCcouldperformin2023and(ii)permissibletaxservicesthe firmcouldprovideduringtheyear.TheAuditCommitteepre-approvedPwC’sfeesforaudit,audit-related,tax compliance,taxplanningandotherservicesinApril2023(havingapprovedinterimfeesforservicesthroughthattime), receivedupdatesonyear-to-datefeesincurredinJulyandNovember,andassessedthefinalfeesinconnectionwithits reviewofauditresultsinFebruary2024.Theseproceduresincludereviewingandapprovingaplanforauditand permittednon-auditservices,whichincludesadescriptionof,andestimatedfeesfor,eachcategoryofauditand non-auditservices.AdditionalAuditCommitteeapprovalisrequiredforservicesnotincludedintheinitialplanorforfees exceedingthebudgetedamountforaparticularcategoryofservices.TheAuditCommitteehasdelegatedinterim pre-approvalauthoritytoitsChairforadditionalservicesthatmaybecomenecessary;theseservicesarepresentedfor approvalbytheentireAuditCommitteeatasubsequentmeeting.

AUDITFEES

Infiscalyears2023and2022,PwCprovidedtheservicesshownbelowforourcompany–allofwhichwere approvedbytheAuditCommitteeinaccordancewiththeproceduresdescribedabove–forwhichwepaidthefirmthe feesindicated.

20232022

AuditFees(1)

$9,623,000$9,158,000

Audit-RelatedFees(2) 207,000203,000

TaxFees:

TaxCompliance(3)

2,940,0002,212,000

TaxPlanning(4) 900,0002,062,000

AllOtherFees(5) 16,00015,000

Total $13,686,000$13,650,000

(1) IncludesfeesforservicesperformedtocomplywiththestandardsestablishedbythePCAOB,includingtheauditsof ourfinancialstatementsandinternalcontroloverfinancialreporting;auditsinconnectionwithstatutoryfilings;and otherservicesthattheprincipalindependentregisteredpublicaccountingfirmcanmosteffectivelyandefficiently provide,suchasproceduresrelatedtocomfortletters,consentsandreviewsofourSECfilings.

(2) Includesfeesassociatedwithassuranceandrelatedservicestraditionallyperformedbytheindependentregistered publicaccountingfirmandreasonablyrelatedtotheperformanceoftheauditorreviewofourfinancialstatements, includingassistanceinfinancialduediligencerelatedtoacquisitionsanddivestituresandtheauditorcompliance servicesnotrequiredbyapplicablestatutesorregulations.Thiscategoryalsoincludesauditsofpensionandother employeebenefitplans,aswellastheauditorreviewofinformationtechnologysystemsandinternalcontrols unrelatedtotheauditofthefinancialstatements.

(3) Includesfeesassociatedwithtaxcompliancesuchaspreparationoftaxreturnsinforeignjurisdictions,taxauditsand transferpricingdocumentation.

(4) IncludesfeesforU.S.andnon-U.S.taxplanning,aswellastaxplanningrelatedtorestructuringactions,acquisitions anddivestitures.

(5) Includesfeesforanyservicesotherthanthosedescribedintheabovecategories.Inbothyears,includedsubscriptions andlicensestoaccountingandtaxresourcesandotherpermissibleservices.

AUDITCOMMITTEEREPORT

COMPOSITIONANDQUALIFICATIONS

TheAuditCommittee(referredtointhisreportasthe“Committee”)ofourBoardofDirectors(our“Board”)is composedofthedirectorsnamedattheendofthisreport,eachofwhommeetstheenhancedindependenceand experiencestandardsforauditcommitteemembersrequiredbySECrulesandNYSElistingstandards.OurBoardhas determinedallmemberstobefinanciallyliterateanddesignatedPatrickSiewertasan“auditcommitteefinancialexpert” underapplicableSECregulations.MembersoftheCommitteeareprohibitedfromsittingontheauditcommitteeofmore thantwootherpubliccompanies,andallmembersareincompliancewiththisrestriction.

PRIMARYRESPONSIBILITIES

TheCommitteehasawrittencharterapprovedbyourBoard,whichisavailableunderCorporateGovernanceinthe investorssectionofourwebsite.TheCommitteeannuallyreviewsitscharterandrecommendschangestotheBoardfor approval.ThecharterwasmostrecentlyamendedinDecember2023.

Duringfiscalyear2023,theCommitteeprimarilyperformedtheactivitiesdescribedbelowonbehalfofourBoard.

•Reviewedanddiscussedwithmanagementandtheindependentregisteredpublicaccountingfirmourquarterly andannualfinancialresults,earningsreleasedocumentationandtherelatedreportswefilewiththeSEC

•Reviewedanddiscussedwithmanagement,ourInternalAuditleaderandtheindependentregisteredpublic accountingfirmourinternalcontrolsreportandtheindependentregisteredpublicaccountingfirm’sattestation thereof

•Evaluatedthequalifications,performanceandindependenceoftheindependentregisteredpublicaccounting firmandmetwithrepresentativesofthefirmtodiscussthescope,budget,staffingandprogressofitsaudit

•Maintainedresponsibilityforthecompensationandoversightoftheworkoftheindependentauditorforthe purposeofpreparingorissuingitsauditreportorrelatedwork,aswellasforapprovingthecompensationofand engagementofanyotherregisteredpublicaccountingfirmpreparingorissuinganauditreportorrelatedworkor performingotherauditorattestservices

•SupervisedourInternalAuditleaderwithrespecttothescope,budget,staffingandprogressoftheinternalaudit andevaluatedhisindividualperformance,aswellastheperformanceofhisfunction

•Discussedsignificantfinancialriskexposures,includingourcybersecurityriskmanagementprogramandrisks relatedtoourcompany’sinformationtechnologycontrolsandsecurity,andthestepstakenbymanagementto monitorandcontroltheseexposures

OVERSIGHTOFCONSOLIDATEDFINANCIALSTATEMENTS

Managementisresponsibleforourconsolidatedfinancialstatements,accountingandfinancialreportingpolicies, internalcontroloverfinancialreporting,anddisclosurecontrolsandprocedures.TheCommitteeappointedthe independentregisteredpublicaccountingfirmofPricewaterhouseCoopersLLP(PwC)toprovideaudit,audit-relatedand taxcomplianceservices,withlimitedtaxplanningandotherservicestotheextentapprovedbytheCommittee.PwC performedindependentauditsofour2023consolidatedfinancialstatementsandinternalcontroloverfinancialreporting inaccordancewiththestandardsofthePublicCompanyAccountingOversightBoard(PCAOB),issuinganopiniononthe conformityofthosefinancialstatementswithaccountingprinciplesgenerallyacceptedintheUnitedStatesofAmerica (GAAP).TheCommittee’sresponsibilityistomonitorandoverseeouraccountingandfinancialreportingprocessesand theauditsofourconsolidatedfinancialstatementsandinternalcontroloverfinancialreporting.Themembersofthe Committeearenotprofessionallyengagedinthepracticeofauditingoraccountingandrelywithoutindependent verificationontheinformationprovidedtothemandtherepresentationsmadebymanagementandPwC.

TheCommitteereviewedanddiscussedourconsolidatedfinancialstatementsandrelatedfootnotesforthefiscalyear endedDecember30,2023–includingourcriticalaccountingpoliciesandmanagement’ssignificantestimatesand judgments–withmanagementandPwC,aswellasPwC’sreportandunqualifiedopiniononitsaudits.Management representedtotheCommitteeandPwCthatourconsolidatedfinancialstatementswerepreparedinaccordancewith GAAP.PwCpresentedthemattersrequiredtobediscussedbyAuditingStandardNo.1301, CommunicationswithAudit Committees.TheCommitteereceivedthesewrittendisclosuresandthelettersfromPwCrequiredbytheapplicable requirementsofthePCAOBregardingcommunicationsconcerningindependence–includingRule3524, Audit CommitteePre-approvalofCertainTaxServices,andRule3526, CommunicationwithAuditCommitteesConcerning Independence– anddiscussedwithPwCitsindependencefromourcompany,Boardandmanagement.

BasedontheCommittee’sreviewanddiscussionswithmanagementandPwC,aswellastheCommittee’sreviewof therepresentationsofmanagementandtheauditreportandunqualifiedopinionofPwC,theCommitteerecommended thatourBoardapproveourAnnualReportonForm10-KforthefiscalyearendedDecember30,2023.

OVERSIGHTOFINDEPENDENTREGISTEREDPUBLICACCOUNTINGFIRM

TheCommitteeisresponsibleforappointingtheindependentregisteredpublicaccountingfirmandmonitoringand overseeingthefirm’squalifications,compensation,performanceandindependence.Inthiscapacity,theCommittee reviewedwithPwCtheoverallscopeofservicesandfeesforitsauditandmonitoredtheprogressofPwC’sauditin assessingourcompliancewithSection404oftheSarbanes-OxleyActof2002,includingthefirm’sfindingsandrequired resources.

PwCprovidedtotheCommitteethewrittendisclosuresandindependenceletterrequiredbythePCAOB.The CommitteediscussedwithPwCitsindependencefromourcompanyandmanagementandconcludedthatPwCwas independentduringfiscalyear2023.TheCommitteehasapolicyrequiringpre-approvaloffeesforaudit,audit-related, taxcompliance,taxplanningandotherservicesandhasconcludedthatPwC’sprovisionoflimitednon-auditservicesto ourcompanyin2023didnotimpairitsindependence.

Underitscharter,theCommitteeisrequiredtoregularlyconsiderwhetheritisappropriatetochangetheindependent registeredpublicaccountingfirm,havingmostrecentlyformallyevaluatedwhetheritmaybeappropriatetodosoin 2022,withaviewtoensuringthatauditqualitywouldcontinuetobeparamount. Recognizingthat–aidedbythe regularrotationofboththeleadengagementpartnerandtheleadrelationshippartner–PwChascontinuedto exerciseindependenceinchallengingmanagement,theCommitteedeterminedtoretainPwC,notingthefirm’saudit effectivenessandconsistentlyimprovingservicedelivery

TheCommitteehasdeterminedthattheappointmentofPwCasourindependentregisteredpublicaccountingfirm forfiscalyear2024isinthebestinterestofourcompanyandstockholders.TheCommitteehasappointedPwCinthis capacityandourBoardhasrecommendedthatstockholdersratifytheappointment.

OVERSIGHTOFINTERNALAUDIT

TheCommittee’sresponsibilityistomonitorandoverseeourinternalauditfunction,reviewingthesignificantaudit resultsreportedtomanagementandmanagement’sresponsesthereto.Inthiscapacity,theCommitteereviewswithour InternalAuditleadertheoverallscopeandbudgetfortheinternalaudit,andregularlymonitorstheprogressofthe internalauditinassessingourcompliancewithSection404oftheSarbanes-OxleyActof2002,includingkeyfindings andrequiredresources.TheCommitteesupervisesourInternalAuditleaderintheconductofhisoperational responsibilitiesandevaluateshisindividualperformanceaswellasthatoftheentireinternalauditfunction.

EXECUTIVESESSIONS

TheCommitteeregularlymeetsseparatelyinexecutivesessionwithoutmanagementpresentwitheachofour InternalAuditleaderandPwCtoreviewanddiscusstheirevaluationsoftheoverallqualityofouraccountingandfinancial reportingandinternalcontrol.TheCommitteealsoregularlymeets,withoutPwCorourInternalAuditleaderpresent, withmanagement,ourCFOandourController,andmeetsasneededwithothermembersofmanagementsuchasour CEOandCLO,todiscuss,amongotherthings,significantriskexposuresimpactingourfinancialstatementsand accountingpolicies.

STOCKHOLDERFEEDBACK

TheAuditCommitteehasestablishedproceduresforthereceipt,retentionandtreatment,onaconfidentialbasis,of complaintsregardingouraccounting,internalcontrolsandauditingmatters.See ComplaintProceduresforAccounting andAuditingMatters inthe Governance sectionofthisproxystatement.TheCommitteewelcomesfeedbackregardingits oversightofourauditprogram.StockholdersmaycommunicatewiththeCommitteebywritingtotheAuditCommittee Chair,c/oCorporateSecretary,8080NortonParkway,Mentor,Ohio44060.

FormerdirectorAnthonyAndersonservedontheAuditCommitteethroughJuly2023andnewdirectorMaria FernandaMejiawasappointedtotheAuditCommitteeinFebruary2024.NeitherMr.AndersonnorMs.Mejia participatedinthereview,discussionsandrecommendationsreflectedinthisAuditCommitteeReport.

MarthaN.Sullivan,ChairAndresA.LopezPatrickT.SiewertWilliamR.Wagner

SECURITYOWNERSHIPINFORMATION

SECURITYOWNERSHIPOFMANAGEMENTANDSIGNIFICANTSTOCKHOLDERS

Thetablebelowshowsthenumberofsharesofourcommonstockbeneficiallyownedbyour(i)currentdirectors; (ii)NEOs;(iii)currentdirectorsandexecutiveofficersasagroup;and(iv)greater-than-five-percent,or“significant,” stockholders,ineachcaseasoftheFebruary26,2024recorddatefortheAnnualMeeting.

NameofBeneficialOwnerCommonStock(1) NumberofRightsExercisableandVesting within60Days(2)

CurrentDirectors

BradleyA.Alford24,08522,39846,483*

MitchellR.Butier308,262202,673510,935*

KenC.Hicks29,93215,33045,262*

AndresA.Lopez2,2451,6493,894*

MariaFernandaMejia *

FrancescaReverberi108 – 108*

PatrickT.Siewert 17,255 – 17,255*

JuliaA.Stewart10,69843,30354,001*

DeonM.Stander46,47813,73060,208*

MarthaN.Sullivan17,59013,86431,454*

WilliamR.Wagner510–510*

Non-DirectorNEOs

GregoryS.Lovins64,22813,91478,142*

FranciscoMelo16,9053,42920,334*

DeenaBaker-Nel3,1214,1627,283*

NicholasR.Colisto7,9783,76611,744*

Allcurrentdirectorsandexecutive officersasagroup(17persons)

(1) Eachcurrentdirector,non-directorNEOandcurrentexecutiveofficerhassolevotingandinvestmentpowerwithrespecttotheirrespectivesharesandno shareshavebeenpledgedassecuritybyanysuchperson.IncludesthefollowingsharesheldinouremployeesavingsplanasofFebruary26,2024:Butier –4,148,Lovins–2,157,Baker-Nel–1,423,andallcurrentdirectorsandexecutiveofficersasagroup–8,654.Theirbusinessaddressis8080Norton Parkway,Mentor,Ohio44060.

(2) NumbersreportedinthiscolumnarenotentitledtovoteduringtheAnnualMeeting.IncludesthefollowingnumberofDSUsdeferredthroughtheDDECP bythefollowingdirectorsasofFebruary26,2024,astowhichtheyhavenovotingorinvestmentpower:Alford–22,398;Hicks–15,330;Lopez–1,649; Stewart–43,303;andSullivan–13,864.DSUsareincludedasbeneficiallyownedbecause,ifthedirectorweretoleaveourBoard,hisorherDDECP accountwouldbevaluedasofthedateofseparationandtheequivalentnumberofsharesofourcommonstock,lessfractionalshares,wouldbeissuedto theseparatingdirector.ForMessrs.ButierandStanderandallnon-directorNEOsandexecutiveofficers,includesPUsandMSUsvestingwithin60days ofFebruary26,2024.

(3) Percentofclassbasedon80,520,396sharesofourcommonstockoutstandingasofFebruary26,2024.Individualswithan(*)beneficiallyownlessthan 1%ofouroutstandingcommonstock.

(4) NumberofsharesbeneficiallyownedbasedoninformationasofDecember31,2023containedinAmendmentNo.13toSchedule13GfiledwiththeSEC onFebruary13,2024.TheVanguardGrouphassolevotingpowerwithrespecttonoshares;sharedvotingpowerwithrespectto102,691shares;sole dispositivepowerwithrespectto9,281,495shares;andshareddispositivepowerwithrespectto342,116shares.TheVanguardGroupisaninvestment adviser,inaccordancewithRule13d-1(b)(1)(ii)(E)oftheExchangeAct,withabusinessaddressof100VanguardBoulevard,Malvern,Pennsylvania 19355.

(5) NumberofsharesbeneficiallyownedbasedoninformationasofDecember31,2023containedinAmendmentNo.15toSchedule13GfiledwiththeSEC onJanuary24,2024.BlackRock,Inc.hassolevotingpowerwithrespectto6,640,110shares;sharedvotingpowerwithrespecttonoshares;sole dispositivepowerwithrespecttoall7,381,914shares;andshareddispositivepowerwithrespecttonoshares.BlackRock,Inc.isaparentholding companyorcontrolperson,inaccordancewithRule13d-1(b)(1)(ii)(G)oftheExchangeAct,withabusinessaddressof50HudsonYards,NewYork,New York10001.

(6) NumberofsharesbeneficiallyownedbasedoninformationasofDecember31,2023containedinSchedule13GfiledwiththeSEConFebruary14,2024. T.RowePriceInvestmentManagement,Inc.hassolevotingpowerwithrespectto1,881,941shares;sharedvotingpowerwithrespecttonoshares;sole dispositivepowerwithrespecttoall4,276,716shares;andshareddispositivepowerwithrespecttonoshares.T.RowePriceInvestmentManagement, Inc.isaninvestmentadviserregisteredunderSection203oftheInvestmentAdvisersActof1940,withabusinessaddressof101E.PrattStreet, Baltimore,Maryland21201.

RELATEDPERSONTRANSACTIONS

UnderourGovernanceGuidelines,BoardmembersareexpectedtocomplywithourCodeofConductandavoidany action,positionorinterestthatconflictsormayappeartoconflictwiththoseofourcompany.TheGovernanceCommittee overseesourconflictofinterestpolicy,whichprohibitsourofficers(includingallexecutiveofficers)andemployees–or anyoftheirimmediatefamilymembers–fromdirectlyorindirectlydoingbusiness,seekingtodobusinessorowningan interestinanentitythatdoesbusinessorseekstodobusinesswithourcompanywithouthavingreceivedpriorwritten approval.Anyofficeroremployeewhohasaquestionastotheinterpretationofthepolicyoritsapplicationtoaspecific activity,transactionorsituationmaysubmitthequestioninwritingtoourlawdepartmentforanyfurtherreview necessarybytheGovernanceCommittee.

Allemployeesatthelevelofmanagerandaboveandallnon-supervisoryprofessionalsareregularlyrequiredto completeacompliancecertificationinwhichtheymust(i)disclose,amongotherthings,whethertheyoranyoftheir immediatefamilymembershaveajob,contractorotherpositionwithanentitythathascommercialdealingswithour companyand(ii)certifythattheyhavecompliedwithourCodeofConductandkeycompanypolicies.Disclosuresare reviewedbyourcomplianceandlawdepartmentsinconsultationwithseniormanagementtodeterminewhetherthe activityhasthepotentialtosignificantlyinfluenceourbusiness.TheGovernanceCommitteereceivedareportfromour ChiefComplianceOfficeronthedisclosureselicitedinthe2022compliancecertificationinearly2023.Weplanto conductthecompliancecertificationprocesslaterthisyear,afterwhichresultswillbediscussedwiththeGovernance Committee.Intheeventthatanunresolveddisclosurepotentiallygivesrisetoasignificantconflictofinterest,the committeedetermineswhetheraconflictofinterestexistsorwhetherthereisareasonablelikelihoodthattheactivity, transactionorsituationwouldinfluencetheindividual’sjudgmentoractionsinperforminghisorherduties.

Inaddition,eachofourdirectorsandexecutiveofficersannuallycompletesaquestionnairedesignedtosolicit informationaboutanypotentialrelatedpersontransactions.Transactionsinvolvingdirectorsarereviewedwiththe GovernanceCommitteebyourCorporateSecretaryinconnectionwithitsannualassessmentofdirectorindependence. ResponsesfromexecutiveofficersarereviewedbyourCorporateSecretarywithoversightbytheGovernanceCommittee intheeventanysuchtransactionsareidentified.

Wereviewinternalfinancialrecordstoidentifytransactionswithsecurityholdersknownbyusfrominformation containedinSchedules13Dor13GfiledwiththeSECtobebeneficialownersofmorethan5%ofourcommonstockto determinewhetherwehaveanyrelationshipswiththesecurityholdersthatmightconstituterelatedpersontransactions underItem404(a)ofRegulationS-K.OurCorporateSecretarydiscussesanyrelationshipsconstitutingrelatedperson transactionswiththeGovernanceCommittee.

Duringfiscalyear2023,therewerenorelatedpersontransactionsrequiringdisclosureunderSECrulesand regulationsandallrelatedpersontransactionswerereviewedinaccordancewiththepoliciesandprocedures describedabove.

VOTINGANDMEETINGQ&A

ANNUALREPORTANDPROXYMATERIALS

HOWDOIACCESSTHE2023ANNUALREPORTAND2024PROXYMATERIALS?

Wehaveelectedtoprovideaccesstoourproxymaterialsontheinternet.Accordingly,wearesendingtheNoticeof InternetAvailabilityofProxyMaterials(the“Notice”)toourstockholdersofrecord.Brokers,banksandothernominees (collectively,“nominees”)whoholdsharesonbehalfofbeneficialowners(alsocalled“streetname”holders)willsenda similarnotice.YouwillhavetheabilitytoaccessourproxymaterialsonthewebsitereferredtointheNotice.Instructions onhowtorequestprintedproxymaterialsbymail,includinganoptiontoreceivepapercopiesinthefuture,maybefound intheNoticeandonthewebsitereferredtointheNotice.

OnoraboutMarch11,2024,wewillmakethisproxystatementand2023AnnualReportavailableonlineand beginmailingtheNoticetoallstockholdersentitledtovote. Onoraboutthesamedate,wewillbeginmailingour2023 IntegratedReport,whichincludesour2023AnnualReportand2024noticeandproxystatement,togetherwithaproxy card,tostockholdersentitledtovoteduringtheAnnualMeetingwhohavepreviouslyrequestedpapercopies.Inaddition, ifyourequestpapercopiesofthesematerialsforthefirsttime,theywillbemailedwithinthreebusinessdaysofrequest. Ifyouholdyoursharesinstreetname,youmayrequestpapercopiesoftheproxystatementandproxycardfromyour nomineebyfollowingtheinstructionsonthenoticeyournomineeprovidestoyou.

StockholdersofrecordmayobtainacopyofthisproxystatementwithoutchargebywritingtoourCorporate Secretaryat8080NortonParkway,Mentor,Ohio44060.

WHATISHOUSEHOLDING?

Wewilldeliveronecopyofour2023IntegratedReporttostockholderssharingthesameaddress.Householding allowsusreduceourprintingandpostagecostsandpreventsmultipleproxymaterialsfrombeingreceivedatyour household;itdoesnotimpactthedeliveryofdividendchecks.

Forholderswhoshareanaddress,wearesendingonlyone2023IntegratedReporttothataddressunlesswehave receivedinstructionstothecontraryfromanystockholderatthataddress.Ifyouwishtoreceiveanadditionalcopyofour 2023IntegratedReport,orifyoureceivemultiplecopiesandwishtoreceiveasinglecopyinthefuture,youmaymake yourrequestbywritingtoourCorporateSecretaryat8080NortonParkway,Mentor,Ohio44060.

Ifyouwishtorevokeyourconsenttohouseholdingandreceiveseparatecopiesofourproxystatementandannual reportinfutureyears,youmaycallBroadridgeInvestorCommunicationsServicestoll-freeat866.540.7095intheU.S. andCanadaorwritethemc/oHouseholdingDepartment,51MercedesWay,Edgewood,NewYork11717.

HOWCANIACCESSTHEANNUALREPORTANDPROXYMATERIALSELECTRONICALLY?

Insteadofreceivingpapercopiesofannualreportsandproxymaterialsbymailinthefuture,youcanelecttoreceive anemailwithalinktothesedocumentsontheinternet,whichallowsyoutoaccessthemmorequickly,saveusthecost ofprintingandmailingthemtoyou,reducetheamountofmailyoureceivefromusandhelpuspreserveenvironmental resources.

YoumayenrolltoaccessproxymaterialsandannualreportselectronicallyforfutureAnnualMeetingsbyregistering onlineatthefollowingwebsite:https://enroll.icsdelivery.com/avy.Ifyouarevotingonline,youcanfollowthelinksonthe votingwebsitetoreachtheelectronicenrollmentwebsite.

VOTING

WHOISSOLICITINGMYVOTE?

OurBoardissolicitingyourvoteinconnectionwiththeAnnualMeeting.

WHOISENTITLEDTOVOTE?

StockholdersofrecordasofthecloseofbusinessonFebruary26,2024areentitledtonoticeof,andtovoteat, theAnnualMeeting.Ourcommonstockistheonlyclassofsharesoutstanding,andtherewere80,520,396sharesof commonstockoutstandingonFebruary26,2024. Thelistofstockholdersentitledtovotewillbeavailableforinspection duringtheAnnualMeeting,aswellasstarting10daysbeforetheAnnualMeetingduringregularbusinesshoursatour companyheadquarterslocatedat8080NortonParkway,Mentor,Ohio44060.Youareentitledtoonevoteforeachshare ofcommonstockyouheldontherecorddate.

HOWDOIVOTE?

YoumayvotebysubmittingaproxyorvotingduringtheAnnualMeetingatwww.virtualshareholdermeeting.com/ AVY2024.Ifyouareabeneficialholder,youmayonlyvoteduringthemeetingifyouproperlyrequestandreceivealegal proxyinyournamefromthenomineethatholdsyourshares.

Themethodofvotingbyproxydiffersdependingonwhetheryouareviewingthisproxystatementonlineor reviewingapapercopy.

•Ifyouareviewingthisproxystatementonline,youmayvoteyoursharesby(i)submittingaproxybytelephone oronlinebyfollowingtheinstructionsonthewebsiteor(ii)requestingapapercopyoftheproxymaterialsand followingoneofthemethodsdescribedbelow.

•Ifyouarereviewingapapercopyofthisproxystatement,youmayvoteyoursharesby(i)submittingaproxyby telephoneoronlinebyfollowingtheinstructionsontheproxycardor(ii)completing,datingandsigningthe proxycardincludedwiththeproxystatementandreturningitinthepreaddressed,postage-paidenvelope provided.

WhetherornotyouplantoattendtheAnnualMeeting,weurgeyoutovotepromptlyusingoneofthemethods describedabove.Weencourageyoutovotebytelephoneoronlinesincethesemethodsimmediatelyrecordyourvote andallowyoutoconfirmthatyourvoteshavebeenproperlyrecorded.Telephoneandonlinevotesmustbereceivedby 11:59p.m.EasternTimeonApril24,2024.

WHATIFMYSHARESWEREACQUIREDTHROUGHTHEDIRECTSHAREPURCHASEANDSALEPROGRAM?

SharesacquiredthroughourDirectSharePurchaseandSaleProgrammaybevotedbyfollowingtheprocedures describedabove.

WHATIFMYSHARESAREHELDINTHEEMPLOYEESAVINGSPLAN?

IfyouholdsharesasaparticipantinourEmployeeSavings(401(k))Plan,yourvoteservesasavotinginstructionto FidelityManagementTrustCompany,thetrusteeoftheplan,onhowtovoteyourshares.Yourvotinginstructionmustbe receivedbythetrusteeby11:59p.m.EasternTimeonApril22,2024.

Ifthetrusteedoesnotreceiveyourinstructioninatimelymanner,yourshareswillbevotedinthesameproportionas thesharesvotedbyplanparticipantswhotimelyfurnishinstructions.Sharesofourcommonstockthathavenotbeen allocatedtoparticipantaccountswillalsobevotedbythetrusteeinthesameproportionasthesharesvotedbyplan participantswhotimelyfurnishinstructions.

HOWDOIREVOKEMYPROXYORCHANGEMYVOTEAFTERIHAVEVOTED?

Ifyougiveaproxypursuanttothissolicitation,youmayrevokeitatanytimebeforeitisacteduponduringthe AnnualMeetingby(i)submittinganotherproxybytelephoneoronline(onlyyourlastinstructionswillbecounted); (ii)sendingalaterdatedpaperproxy;or(iii)ifyouareentitledtodoso,votingduringtheAnnualMeeting.Simply attendingtheAnnualMeetingwillnotrevokeyourproxy.

Ifyoursharesareheldinstreetname,youmayonlychangeyourvotebysubmittingnewvotinginstructionstoyour nominee.Youmustcontactyournomineetofindouthowtochangeyourvote.SharesheldinourEmployeeSavingsPlan cannotbechangedorrevokedafter11:59p.m.EasternTimeonApril22,2024,norcantheybevotedduringtheAnnual Meeting.

ISMYVOTECONFIDENTIAL?

Exceptincontestedproxysolicitations,whenrequiredbylaworasauthorizedbyyou(suchasbymakingawritten commentonyourproxycard,inwhichcasethecomment,butnotyourvote,maybesharedwithourcompany),yourvote orvotinginstructionisconfidentialandwillnotbedisclosedotherthantothebroker,trustee,agentorinspectorof electiontabulatingyourvote.

HOWWILLVOTESBECOUNTED?

VotescastbyproxyorduringtheAnnualMeetingwillbetabulatedbyarepresentativefromBroadridgeFinancial Solutions,Inc.,theindependentinspectorofelectionappointedbyourBoard.Theinspectorofelectionwillalsodetermine whetheraquorumispresent.DuringtheAnnualMeeting,sharesrepresentedbyproxiesthatreflectabstentionsorbroker non-votes(whicharesharesheldbyanomineethatarerepresented,butwithrespecttowhichthenomineeneitherhas discretionaryauthoritytovotenorhasbeengivenactualauthoritytovoteonaparticularitem)willbecountedasshares thatarepresentandentitledtovoteforpurposesofdeterminingthepresenceofaquorum.Items1,2and3are non-routineundertherulesoftheNYSEandItem4isroutine.Nomineesareprohibitedfromvotingonnon-routineitems intheabsenceofinstructionsfromthebeneficialownersoftheshares;asaresult, ifyouholdyoursharesinstreetname anddonottimelysubmitvotinginstructionstoyournominee,yourshareswillnotbevotedonItem1,electionof directors;Item2,approval,onanadvisorybasis,ofourexecutivecompensation;orItem3,approvalofaCertificateof AmendmenttoourAmendedandRestatedCertificateofIncorporationtoprovidethatstockholdersholding25%of ouroutstandingcommonstockhavetherighttorequestthatwecallspecialmeetingsofstockholders. Weurgeyou topromptlyprovidevotinginstructionstoyournomineesothatyourvoteiscounted.

ThevoterequiredtoapproveeachoftheAnnualMeetingbusinessitems,aswellastheimpactofabstentionsand brokernon-votes,isshowninthechartbelow.

3

Majorityofshares

outstanding

RatificationofappointmentofPwCasour

Asofthedateofthisproxystatement,weknowofnootherbusinesstobepresentedforconsiderationduringthe meeting.Ifanyotherbusinessproperlycomesbeforethemeeting,yourvotewillbecastonanysuchotherbusinessby theindividualsactingpursuanttoyourproxyintheirbestjudgment.

HOWDOIFINDVOTERESULTS?

WeexpecttoannouncepreliminaryvotingresultsduringtheAnnualMeetingandreportfinalvotingresultsina CurrentReportonForm8-KfiledwiththeSEConorbeforeMay1,2024.

2024ProxyStatement | AveryDennisonCorporation

ANNUALMEETINGINFORMATION

WHATISTHETIME,DATEANDFORMATOFTHEANNUALMEETING?

TheAnnualMeetingwilltakeplaceat2:30p.m.EasternTimeonApril25,2024.Toallowstockholderstoattend withoutthetimeandexpenseofdoingsoinperson,themeetingwillbeheldvirtually,withattendanceviatheinternet.

HOWCANIATTENDTHEVIRTUALMEETING?

ToattendthevirtualAnnualMeeting,youwillneedtologintothevirtualmeetingwebsiteat www.virtualshareholdermeeting.com/AVY2024usingthe16-digitcontrolnumberonyourNotice,proxycardorvoting instructionform.OnlineaccesstotheliveaudiowebcastoftheAnnualMeetingwillopenat2:15p.m.EasternTimeto allowtimeforyoutologinandtestyourdevice’saudiosystem.Weencourageyoutoaccessthemeetinginadvanceof itsstarttimeasweplantobeginconductingthemeetingpromptly.

HOWDOIASKQUESTIONSDURINGTHEMEETING?

WehavedesignedthevirtualAnnualMeetingtoensurethatyouhavethesamerightsandopportunitiesto participateasyouwouldatanin-personmeeting,usingeasy-to-useonlinetoolsthatallowyoutoattend,voteand askquestions. Onlystockholdersasoftherecorddateortheirproperlyappointedproxiesmayaskquestionsduringthe meeting,andourExecutiveChairmanmaylimitthelengthofdiscussiononanyparticularmatter.DuringtheAnnual Meeting,youcanviewourGroundRulesforConductofMeetingandsubmitquestionsonthemeetingwebsite.

AfterthebusinessportionoftheAnnualMeetingconcludesandthemeetingisadjourned, wewillholdaQ&A sessionduringwhichweintendtoanswerallquestions submittedtimelythatarepertinenttoourcompanyandthe itemsbeingbroughtbeforestockholdervote,astimepermitsandinaccordancewithourGroundRulesforConductof Meeting.Questionsandanswerswillbegroupedbytopicandsubstantiallysimilarquestionswillbeansweredonlyonce. Toensureallquestionsareabletobeaddressed,wewillrespondtonomorethanthreequestionsfromanysingle stockholder. Answerstoquestionsnotaddressedduringthemeeting,ifany,willbepostedpromptlyafterthe meetingontheinvestorssectionofourwebsite.

Asaresultoftimeconstraintsandotherconsiderations,wecannotassureyouthateverystockholderwishingto addressthemeetingwillhavetheopportunitytodoso.However,stockholdersareinvitedtodirectinquiriesorcomments regardingbusinessmatterstoourInvestorRelationsdepartmentbyemailtoinvestorcom@averydennison.comorbymail to8080NortonParkway,Mentor,Ohio44060.Inaddition,stockholderswishingtoaddressmatterstoourBoardorany ofitsmembersmaydosoasdescribedunderContactingOurBoardinthe OurBoardofDirectors sectionofthisproxy statement.

WHATDOIDOIFIAMHAVINGTECHNICALISSUESACCESSINGORPARTICIPATINGINTHEMEETING?

Beginning15minutespriorto,andduring,theAnnualMeeting,wewillhavesupportavailabletoassiststockholders withanytechnicaldifficultiestheymayhaveaccessingorhearingthevirtualmeeting.Ifyouencounteranydifficulty accessing,orduring,thevirtualmeeting,pleasecallthesupportteamat1.844.986.0822(toll-freeintheU.S.and Canada)or+1.303.562.9302(forallotherattendees).

HOWAREPROXIESBEINGSOLICITED?

WehaveretainedMorrowSodaliLLCtoassistinsolicitingproxiesforafeeof$12,000,plusreimbursementof out-of-pocketexpensesincidenttopreparingandmailingourproxymaterials.Certainofouremployeesmaysolicit proxiesbytelephoneoremail;theseemployeeswillnotreceiveanyadditionalcompensationfortheirproxysolicitation efforts.Wewillpaythecostsrelatedtooursolicitationofproxiesandreimbursebanks,brokersandothercustodians, nomineesandfiduciariesforreasonableout-of-pocketexpensestheyincurinforwardingourproxymaterialstobeneficial stockholders.Youcanhelpreducethesecostsinthefuturebyconsentingtoaccessourproxymaterialselectronically.

MATTERSRELATEDTO2025ANNUALMEETING

HOWDOISUBMITITEMSFORPOTENTIALCONSIDERATIONATTHE2025ANNUALMEETING?

ToproposebusinesssatisfyingtheeligibilityrequirementsofSECRule14a-8tobeconsideredforinclusioninour proxystatementforthe2025AnnualMeeting,youmustprovidenoticeofproposeditemssotheyarereceivedatour principalexecutiveofficesonorbeforeNovember11,2024.IfyouwishtonominatepersonsforelectiontoourBoardor bringanyotherbusinessbeforeanannualmeetingundertheadvancenoticeprovisionsorourBylaws,youmustnotify ourCorporateSecretaryatourprincipalexecutiveofficesinwriting90to120dayspriortothefirstanniversaryofthe precedingyear’sannualmeeting(withrespecttothe2025AnnualMeeting,noearlierthanDecember26,2024andno laterthanJanuary25,2025)andcomplywiththeotherrequirementssetforthinourBylaws.

Yournoticemustinclude,amongotherthings,theinformationdescribedbelowandingreaterdetailinArticleII, Section14ofourBylaws,whichareavailableunderCorporateGovernanceintheinvestorssectionofourwebsite.

•Astoeachpersonwhoyouproposetonominateforelectionorreelectionasadirector:

•Allinformationrelatingtothepersonthatisrequiredtobedisclosedinsolicitationsofproxiesforelectionof directorsinanelectioncontestorisotherwiserequiredpursuanttoRegulation14undertheExchangeAct

•Theperson’swrittenconsenttobenamedinourproxystatementandaccompanyingproxycardasanominee andserveasadirectorifelectedforafulltermuntilthenextmeetingatwhichsuchnomineewouldface reelection

•Allinformationwithrespecttosuchpersonthatwouldberequiredtobesetforthinastockholder’snotice pursuanttoourBylawsifsuchpersonwereastockholder

•Adescriptionofalldirectandindirectmaterialinterestinanymaterialcontractoragreementbetweenor amonganystockholder,ontheonehand,andthenominee(andhisorheraffiliates),ontheotherhand,as moreparticularlysetforthinourBylaws

•Astoanyotheritemofbusinessyouproposetobringbeforethemeeting,abriefdescriptionofthebusiness;the reasonsforconductingthebusinessduringthemeeting;areasonablydetaileddescriptionofallagreements, arrangementsandunderstandingsbetweenoramonganystockholdersandbetweenoramonganystockholder andotherpersonorentityinconnectionwiththeproposalofsuchbusinessbysuchstockholder;andanyother informationrelatingtosuchitemofbusinessthatwouldberequiredtobedisclosedinaproxystatementorother filingrequiredtobemadeinconnectionwithsolicitationsofproxiesinsupportofthebusinessproposedtobe broughtbeforethemeetingpursuanttoSection14(a)oftheExchangeAct

•Yournameandaddress,andtheclassandnumberofsharesyouownbeneficiallyandasofrecord,aswellas informationrelatingtoyoursecurityownershipinourcompany

Stockholderitemsofbusinessthatdonotfullycomplywiththeadvancenoticeandotherrequirementscontainedin ourBylawswillnotbepermittedtobebroughtbeforethe2025AnnualMeeting.Inadditiontosatisfyingthe requirementsunderourBylaws,tocomplywiththeSEC’suniversalproxyrules,stockholderswhointendtosolicitproxies insupportofdirectornomineesotherthanourBoard’snomineesmustprovidewrittennoticetoourCorporateSecretary atourprincipalexecutiveofficesthatincludestheinformationrequiredbyRule14a-19undertheExchangeActnolater thanFebruary24,2025.

WeintendtofileaproxystatementandawhiteproxycardwiththeSECinconnectionwithoursolicitationofproxies forthe2025AnnualMeeting.

HOWDOINOMINATEDIRECTORSFORINCLUSIONINTHE2025PROXYSTATEMENT?

OurBylawspermitastockholder,oragroupofnomorethan20stockholders,owningatleast3%ofourcompany’s outstandingsharesofcommonstockcontinuouslyforatleastthreeyearstonominateandincludeinourannualmeeting proxymaterialsdirectornomineesconstitutinguptothegreateroftwonomineesor20%ofourBoard,subjecttothe requirementscontainedinArticleII,Section17ofourBylaws,whichareavailableunderCorporateGovernanceinthe investorssectionofourwebsite.Noticeofproxyaccessdirectornomineesforthe2025AnnualMeetingmustbe deliveredtoourCorporateSecretaryatourprincipalexecutiveofficesnoearlierthanOctober12,2024andnolaterthan November11,2024andmustotherwisecomplywiththerequirementssetforthinourBylaws.

APPENDIXA–RECONCILIATIONOFNON-GAAPFINANCIALMEASURES FROMGAAP

WereportourfinancialresultsinconformitywithaccountingprinciplesgenerallyacceptedintheUnitedStatesof America,orGAAP,andalsocommunicatewithinvestorsusingcertainnon-GAAPfinancialmeasures.Thesenon-GAAP financialmeasuresarenotinaccordancewith,noraretheyasubstitutefororsuperiorto,thecomparableGAAPfinancial measures.Thesenon-GAAPfinancialmeasuresareintendedtosupplementthepresentationofourfinancialresults preparedinaccordancewithGAAP.Weusethesenon-GAAPfinancialmeasuresinternallytoevaluatetrendsinour underlyingperformance,aswellastofacilitatecomparisontotheresultsofcompetitorsforquartersandyear-to-date periods,asapplicable.Basedonfeedbackfrominvestorsandfinancialanalysts,webelievethatthesupplemental non-GAAPfinancialmeasuresweprovidearealsousefultotheirassessmentsofourperformanceandoperatingtrends, aswellasliquidity.

Ournon-GAAPfinancialmeasuresexcludetheimpactofcertainevents,activitiesorstrategicdecisions.The accountingeffectsoftheseevents,activitiesordecisions,whichareincludedintheGAAPfinancialmeasures,maymake itmoredifficulttoassessourunderlyingperformanceinasingleperiod.Byexcludingtheaccountingeffects,positiveor negative,ofcertainitems(e.g.,restructuringcharges,outcomesofcertainlegalproceedings,certaineffectsofstrategic transactionsandrelatedcosts,lossesfromdebtextinguishments,gainsorlossesfromcurtailmentorsettlementof pensionobligations,gainsorlossesonsalesofcertainassets,gainsorlossesonventureinvestments,currency adjustmentsduetohighlyinflationaryeconomies,andotheritems),webelievethatweareprovidingmeaningful supplementalinformationthatfacilitatesanunderstandingofourcoreoperatingresultsandliquiditymeasures.While someoftheitemsweexcludefromGAAPfinancialmeasuresrecur,theytendtobedisparateinamount,frequencyor timing.

Weusethefollowingnon-GAAPfinancialmeasuresinthisproxystatement,whicharereconciledfromGAAPonthe followingpages:

• Saleschangeex.currency referstotheincreaseordecreaseinnetsales,excludingtheestimatedimpactof foreigncurrencytranslation;thereclassificationofsalesbetweensegments;whereapplicable,anextraweekin ourfiscalyearandthecalendarshiftresultingfromtheextraweekinthepriorfiscalyear;andcurrency adjustmentsfortransitionalreportingofhighlyinflationaryeconomies.Theestimatedimpactofforeigncurrency translationiscalculatedonaconstantcurrencybasis,withprior-periodresultstranslatedatcurrentperiod averageexchangeratestoexcludetheeffectofforeigncurrencyfluctuations.

• Organicsaleschange referstosaleschangeex.currency,excludingtheestimatedimpactofacquisitionsand productlinedivestitures.

Webelievethatsaleschangeex.currencyandorganicsaleschangeassistinvestorsinevaluatingthesales changefromtheongoingactivitiesofourbusinessesandenhancetheirabilitytoevaluateourresultsfromperiod toperiod.

• AdjustedEBITDA referstoadjustedoperatingincomebeforedepreciationandamortization.Adjustedoperating incomeisincomebeforetaxes;interestexpense;othernon-operatingexpense(income),net;andotherexpense (income),net.

• AdjustedEBITDAmargin referstoadjustedEBITDAasapercentageofnetsales.

Adjustednetincomepercommonshare,assumingdilution(adjustedEPS),referstoadjustednetincomedivided bytheweightedaveragenumberofcommonsharesoutstanding,assumingdilution.Adjustednetincomeis incomebeforetaxes,tax-effectedattheadjustedtaxrate,andadjustedfortax-effectedrestructuringcharges andotheritems.Adjustedtaxrateisthefull-yearGAAPtaxrate,adjustedtoexcludecertainunusualor infrequenteventsthatareexpectedtosignificantlyimpactthatrate,suchaseffectsofcertaindiscretetax planningactions,impactsrelatedtoenactmentsofcomprehensivetaxlawchanges,andotheritems.

WebelievethatadjustedEBITDA,adjustedEBITDAmarginandadjustedEPSassistinvestorsinunderstanding ourcoreoperatingtrendsandcomparingourresultswiththoseofourcompetitors.

• Adjustedfreecashflow referstocashflowprovidedbyoperatingactivities,lesspaymentsforproperty,plant andequipment,softwareandotherdeferredcharges,plusproceedsfromcompany-ownedlifeinsurancepolicies, plusproceedsfromsalesofproperty,plantandequipment,plus(minus)netproceedsfrominsuranceandsales (purchases)ofinvestments.Whereapplicable,adjustedfreecashflowisalsoadjustedforcertainacquisitionrelatedtransactioncosts.Webelievethatadjustedfreecashflowassistsinvestorsbyshowingtheamountof cashwehaveavailablefordebtreductions,dividends,sharerepurchases,andacquisitions.

• Returnontotalcapital (ROTC)referstonetincomeexcludinginterestexpenseandamortizationofintangible assetsfromacquisitions,netoftaxbenefit,dividedbytheaverageofbeginningandendinginvestedcapital.We believethatROTCassistsinvestorsinunderstandingourabilitytogeneratereturnsfromourcapital.

• Adjustedearningsbeforeinterestandtaxes (EBIT)referstoearningsbeforeinterestexpense,other non-operatingexpense(income),taxesandequitymethodinvestmentlosses,excludingnon-cashrestructuring costs,andotheritems.WebelievethatadjustedEBITassistsinvestorsinunderstandingourcoreoperating trendsandcomparingourresultswiththoseofourcompetitors.WeuseadjustedEBITtocalculateeconomic valueadded(EVA),oneoftheperformanceobjectivesusedinourlong-termincentivecompensationprogram.

SALESCHANGEEX.CURRENCYANDORGANICSALESCHANGE

Foreigncurrencytranslation(3.4)%5.6%0.6% Extraweekimpact1.4%––

(1) Reflectsthree-yearcompoundannualgrowthrates,with2020asthebaseperiod.

(2) Totalsmaynotsumduetorounding.

ADJUSTEDEBITDAANDADJUSTEDEBITDAMARGIN

202120222023

2021-2023

2021-2023 3-YRCAGR(1)

Operatingincomebeforeinterestexpense,othernon-operatingexpense (income),taxes,andequitymethodinvestmentlosses,asreported$1,058.7$1,074.0$782.9(1.1)%

Operatingmargins,asreported12.6%11.9%9.4%

Non-GAAPadjustments:

Restructuringcharges:

Severanceandrelatedcosts,netofreversals$10.5$7.6$70.8

Assetimpairmentandleasecancellationcharges3.10.18.6

Otheritems(2) (8.0)(8.3)101.5

Adjustedoperatingincome(non-GAAP)$1,064.3$1,073.4$963.8

Adjustedoperatingmargins(non-GAAP)12.7%11.9%11.5%

Depreciationandamortization$244.1$290.7$298.4

AdjustedEBITDA(non-GAAP)$1,308.4$1,364.1$1,262.25.7%

AdjustedEBITDAmargins(non-GAAP)15.6%15.1%15.1%

(1) Reflectsthree-yearcompoundannualgrowthrates,with2020asthebaseperiod.

(2) Includespre-tax(gain)/lossonventureinvestments,gainonsaleofproductline,(gain)/lossonsalesofassets,outcomesoflegalproceedings,transactionand relatedcosts,andArgentinepesoremeasurementloss.TheArgentinepesoremeasurementlossonlyincludesthethirdandfourthquartersof2023asprior amountswerenotmaterial.

ADJUSTEDEPS

($inmillions,exceptpershareamounts)

Asreportednetincome

Asreportednetincomepercommonshare,assumingdilution

Non-GAAPadjustmentspercommonshare,netoftax:

Restructuringchargesandotheritems(2)

202120222023

2021-2023 3-YRCAGR(1)

0.05(0.06)1.85

Argentineinterestincome––(0.15)

Pensionplansettlementandcurtailmentlosses0.03––

Adjustednetincomepercommonshare,assumingdilution(non-GAAP)$8.91$9.15$7.903.6%

Adjustedtaxrateswere25%,24.7%and25.8%for2021,2022and2023,respectively.

(1) Reflectsthree-yearcompoundannualgrowthrates,with2020asthebaseperiod.

(2) Otheritemsinclude(gain)/lossonventureinvestments,gainonsaleofproductline,(gain)/lossonsalesofassets,outcomesoflegalproceedings,transactionand relatedcosts,andArgentinepesoremeasurementloss.TheArgentinepesoremeasurementlossonlyincludesthethirdandfourthquartersof2023asprior amountswerenotmaterial.

ADJUSTEDFREECASHFLOW

($inmillions)

202120222023

Netcashprovidedbyoperatingactivities$1,046.8$961.0$826.0

Purchasesofproperty,plantandequipment(255.0)(278.1)(265.3)

Purchasesofsoftwareandotherdeferredcharges(17.1)(20.4)(19.8)

Proceedsfromcompany-ownedlifeinsurancepolicies––48.1

Proceedsfromsalesofproperty,plantandequipment1.12.31.0

Proceedsfrominsuranceandsales(purchases)ofinvestments,net3.11.91.9

Paymentsforcertainacquisition-relatedtransactioncosts18.80.6–

RETURNONTOTALCAPITAL(ROTC)

ADJUSTEDEARNINGSBEFOREINTERESTANDTAXES(EBIT)

($inmillions)

Asreportednetincome

Adjustments:

202120222023

Othernon-operatingexpense(income),net(4.1)(9.4)(30.8)

Equitymethodinvestmentlosses3.9––

Operatingincomebeforeinterestexpense,othernon-operatingexpense(income),taxes,andequity methodinvestmentlosses

Reconcilingitems:

Non-cashrestructuringcosts

Otheritems(1)

Adjustedearningsbeforeinterestexpense,othernon-operatingexpense(income),taxes,equity methodinvestmentlosses,non-cashrestructuringcosts,andotheritems(non-GAAP)$1,044.3$1,008.0$824.1

(1) IncludesimpactofacquisitionscompletedaftertargetsweresetandtheRussia-Ukrainewar,(gain)/lossonventureinvestments,gainonsaleofproductline, (gain)/lossonsalesofassets,outcomesoflegalproceedings,transactionandrelatedcosts,andArgentinepesoremeasurementloss.TheArgentinepeso remeasurementlossonlyincludesthethirdandfourthquartersof2023asprioramountswerenotmaterial.

APPENDIXB–TEXTOFCERTIFICATEOFAMENDMENTTOAMENDED ANDRESTATEDCERTIFICATEOFINCORPORATION

CERTIFICATEOFAMENDMENT OF AMENDEDANDRESTATEDCERTIFICATEOFINCORPORATION OF AVERYDENNISONCORPORATION

(PursuanttoSection242oftheGeneralCorporationLawoftheStateofDelaware)

AveryDennisonCorporation,aDelawarecorporationdulyorganizedandexistingundertheGeneralCorporationLaw oftheStateofDelaware(the“Corporation”),doesherebycertifythat:

1.ArticleVIIoftheAmendedandRestatedCertificateofIncorporationoftheCorporation(the“Charter”)ishereby amendedinitsentiretytoreadasfollows:

“Directorsshallbeelectedannuallyfortermsofoneyearandshallholdofficeuntilthenextsucceedingannual meetinganduntilhisorhersuccessorshallbeelectedandshallqualify,butsubjecttopriordeath,resignation, retirement,disqualificationorremovalfromoffice.Shouldavacancyoccurorbecreated,includingfroman increaseinthenumberofdirectors,theremainingdirectors(eventhoughlessthanaquorum)mayfillthe vacancyfortheremainderoftheterminwhichthevacancyoccursoriscreated.Anydirectorelectedor appointedtofillavacancynotresultingfromanincreaseinthenumberofdirectorsshallhavethesame remainingtermasthatofhisorherpredecessor.”

2.ArticleXoftheCharterisherebyamendedinitsentiretytoreadasfollows:

“SpecialmeetingsofthestockholdersoftheCorporationforanypurposeorpurposes(i)maybecalledatany timebytheBoardofDirectors,orbyamajorityofthemembersoftheBoardofDirectors,orbyacommitteeof theBoardofDirectorswhichhasbeendulydesignatedbytheBoardofDirectorsandwhosepowersand authority,asprovidedinaresolutionoftheBoardofDirectorsorintheBylawsoftheCorporation,includethe powertocallsuchmeetingsor(ii)shallbecalledbytheSecretaryoftheCorporationuponawrittenrequestof theholdersofrecordwho“own”(assuchtermisdefinedintheBylawsoftheCorporation(astheymaybe amendedand/orrestatedfromtimetotime,the“Bylaws”)atleasttwenty-fivepercent(25%)oftheoutstanding sharesofCommonStockandwhohavecompliedinfullwiththerequirementssetforthintheBylaws,butsuch specialmeetingsmaynotbecalledbyanyotherpersonorpersons;provided,however,thatifandtotheextent thatanyspecialmeetingofstockholdersmaybecalledbyanyotherpersonorpersonsspecifiedinanyprovision oftheCertificateofIncorporationoranyamendmenttheretooranycertificatefiledunderSection151(g)ofthe DelawareGeneralCorporationLaw,thensuchspecialmeetingmayalsobecalledbythepersonorpersons,in themanner,atthetimesandforthepurposesospecified.”

3.TheforegoingamendmentstotheCharterweredulyadoptedinaccordancewiththeprovisionsofSection242of theGeneralCorporationLawoftheStateofDelaware.

INWITNESSWHEREOF,theCorporationhascausedthisCertificateofAmendmenttobeexecutedbyitsduly authorizedofficeronthisdayof2024.

AVERYDENNISONCORPORATION

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