AI interpretation based on checked source excerpts. Issuer assertions and evidence limitations remain explicit.
Policy quality-scores-2: six equally weighted categories. The overall score requires full coverage. Missing inputs are not zero. Qualitative grades are sourced interpretations, not probabilities. 5/6 · 18/10/2026
Moat50
Equal-weight average of four evidence-backed rubric grades (0–4), scaled to 100.
structural advantage · 2/4 · Proprietary tools, specialized analytics and market relationships support differentiation, corroborated by renewal and underlying growth. Relative superiority and exclusivity remain unmeasured.
durability · 2/4 · Established capabilities and continued demand support persistence, but employee-linked relationships and clients' ability to terminate engagements constrain protection.
customer dependency · 2/4 · Renewal growth demonstrates repeat business and specialized advice supports ongoing relevance. Insourcing and penalty-free termination limit dependency; no quantified lock-in is established.
erosion resilience · 2/4 · Marsh Risk and Consulting continued underlying growth in first-half 2026, but Guy Carpenter was flat for the half and declined in the second quarter. AI competition and talent mobility remain prospective erosion channels.
Pricing power—
Insufficient evidence for every rubric criterion; no category score is inferred.
realized pricing · — · Growth despite declining insurance premium rates demonstrates demand resilience, but does not isolate Marsh's own fee or commission-rate outcomes. The supplied evidence cannot establish realized service pricing.
retention · 2/4 · Higher renewal revenue establishes repeat demand, supported indirectly by continued underlying growth. Revenue growth is not a retention rate, and employee mobility and termination rights limit stronger conclusions.
margin resilience · 2/4 · The issuer reports 18 consecutive years of adjusted margin expansion, but first-half 2026 operating income fell as revenue increased, while second-quarter operating income grew more slowly than revenue. The $425 million first-quarter litigation charge materially affects the comparison. Adjusted methodology also changed in 2025; margins do not independently prove pricing power.
contractual freedom · 1/4 · Disclosed penalty-free client termination limits contractual protection. Mercer Health compensation depends partly on insurer commissions and volume, growth and account retention. These terms indicate fragile control, although group-wide repricing rights are not supplied.
Predictability100
Five consecutive annual periods. Equal weights: nondeclining revenue frequency; revenue-growth volatility (5–40pp); positive FCF frequency; FCF-margin volatility (3–20pp). Stability indicator, not a growth forecast.
- Nondeclining revenue years (%)
- 100.00
- Revenue growth volatility (pp)
- 2.26
- Positive FCF years (%)
- 100.00
- FCF margin volatility (pp)
- 1.35
Financial strength45
Equal-weight grades: debt/FCF (1–8x), net debt/earnings before interest and tax (0–5x), interest service (1–12x), current ratio (0.75–2x). Earnings use reported operating income, or reported pretax profit plus reported interest expense when operating income is unavailable. Interest service uses earnings/interest expense; if unavailable, it uses reported operating cash flow/cash interest paid, without relabeling cash paid as accrued expense. Nonpositive cash flow/earnings score 0 for their service component; reported zero interest with a positive numerator scores 100. Net cash scores 100 for net leverage. Missing disclosures remain unavailable. General nonfinancial-company rubric, not a credit rating; exceptional and nonoperating gains are not normalized out. IFRS finance-cost and cash-flow classifications retain their reported scope.
- debtFcfGrade
- 58.33
- netDebtEbitGrade
- 45.69
- interestCoverageGrade
- 49.84
- currentRatioGrade
- 28.13
- Debt / FCF (x)
- 3.92
- Net debt / operating income (x)
- 2.72
- Interest coverage (x)
- 6.48
- Current ratio (x)
- 1.10
Capital allocation97
Three-year equal-weight indicators: pretax return on average invested capital (0–25%; equity + debt − cash, each year and its prior year), share-count growth (0–5%, lower better), share-based cost/revenue (2–20%, lower better), consolidated FCF/net income (0–1x). Return uses reported operating income or, if unavailable, EBIT calculated from reported pretax profit plus reported interest expense; exceptional/nonoperating gains are not normalized out. Share-based cost uses the reported cash-flow add-back or, if absent, separately reported recognized compensation expense; the latter never becomes an FCF adjustment. Nonpositive net income scores 0 for cash conversion; absent income/FCF stays unavailable. Nonpositive invested capital has no defined return and remains unavailable. Does not establish acquisition quality or buyback timing.
- 3-year pre-tax operating return (%)
- 21.93
- 3-year average dilution (%)
- -0.54
- 3-year average SBC / revenue (%)
- 1.52
- cashConversionGrade
- 100.00
Management63
Equal-weight average of four evidence-backed rubric grades (0–4), scaled to 100.
capital discipline · 2/4 · Disclosed cash generation, completed repurchases exceeding employee-plan issuance, and acquisition revenue contributions support an assessable record. The large McGriff purchase and continuing acquisition obligations require returns that the passages do not establish. Revenue contribution alone does not demonstrate attractive acquisition economics.
incentive alignment · 3/4 · Actual PSU arrangements use three-year financial and relative-return objectives, with multiyear vesting, forfeiture and ownership-related sale restrictions. Adopted clawbacks add protection. Above-target bonuses despite tempered performance show discretion, and actual ownership compliance is not established.
execution · 2/4 · Underlying growth and disclosed acquisition contributions demonstrate execution through operating evidence rather than reputation. Flat first-half reinsurance growth, a second-quarter decline and the realized Greensill charge make the record mixed. Thrive savings remain a forecast.
governance · 3/4 · An independent board except for the CEO, an independent chair, shareholder special-meeting rights and adopted clawbacks provide strong disclosed safeguards. Management reports effective disclosure controls. The litigation charge warrants caution but does not itself establish governance misconduct; exceptional effectiveness is unproven.
Evidence
Through Marsh's patented electronic platform, MarketConnect, and sophisticated data analysis, ICG provides insurers with individualized preference setting and risk identification capabilities, as well as detailed performance data and metrics.
Business — Insurer Consulting Group, patented MarketConnect platform · Filed 10/02/2025
•Career: advising on employee engagement, skill assessment, executive remuneration, HR effectiveness and M&A strategy utilizing proprietary data and tools.
Business — Mercer Career, proprietary data and tools · Filed 09/02/2026
Guy Carpenter creates and executes reinsurance and risk management solutions globally through risk assessment analytics, actuarial services and trading relationships with reinsurance markets.
Business — Guy Carpenter analytics, actuarial services and trading relationships · Filed 09/02/2026
In Risk and Insurance Services, underlying revenue growth in 2025 was driven by higher new business and renewal revenue at Marsh Risk and Guy Carpenter, partially offset by declining insurance and reinsurance premium rates.
MD&A — 2025 new-business and renewal growth despite declining premium rates · Filed 09/02/2026
This reflects an increase of 4% on an underlying basis and 10% from acquisitions.
MD&A — Marsh Risk 2025 underlying and acquired revenue growth · Filed 09/02/2026
For the six months ended June 30, 2026, Marsh Risk's revenue was $7.8 billion, an increase of 7%, or 4% on an underlying basis.
MD&A — Marsh Risk first-half 2026 underlying revenue growth · Filed 21/07/2026
For the six months ended June 30, 2026, Consulting revenue was $5.2 billion, an increase of 10%, or 7% on an underlying basis.
MD&A — Consulting first-half 2026 underlying revenue growth · Filed 21/07/2026
If a key employee were to join an existing competitor or form a competing company, some of our clients could choose to use the services of a competitor instead of our services.
Risk Factors — potential client movement following employee departures · Filed 09/02/2026
Many of our clients, including financial institutions, corporations, government entities and pension plans, have reduced expenses, including amounts spent on consulting services, and used internal resources instead of consultants during difficult economic periods.
Risk Factors — clients' historical consulting expense reductions and insourcing · Filed 09/02/2026
•fluctuations in capacity and utilization rates and clients' ability to terminate engagements without penalty;
Risk Factors — clients' ability to terminate engagements without penalty · Filed 09/02/2026
The consulting business faces competition from global, regional and local firms, including independent consulting, broking and outsourcing firms affiliated with accounting, technology and financial services and new entrants utilizing generative AI.
Business — consulting competition, including generative AI entrants · Filed 09/02/2026
Guy Carpenter's revenue for the three months ended June 30, 2026 was $664 million, a decrease of 2% on a reported and underlying basis.
MD&A — Guy Carpenter second-quarter 2026 underlying revenue decline · Filed 21/07/2026
Consolidated operating expenses for the three months ended March 31, 2026 reflect the recording of an estimated liability and legal expenses of $425 million related to the Greensill litigation.
MD&A — first-quarter 2026 Greensill estimated liability and legal expenses · Filed 16/04/2026
In the majority of cases, Mercer's Health business is compensated through commissions for the placement of insurance contracts and supplemental compensation from insurers based on various factors as volume, growth of accounts, and total retention of accounts placed by Mercer.
Business — Mercer Health commission and supplemental compensation arrangements · Filed 09/02/2026
MARSH & McLENNAN COMPANIES, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF INCOME (Unaudited) Three Months Ended June 30, Six Months Ended June 30, (In millions, except per share data) 2026 2025 2026 2025 Revenue $ 7,404 $ 6,974 $ 15,001 $ 14,035 Expense: Compensation and benefits 4,141 3,895 8,271 7,745 Other operating expenses 1,364 1,250 3,077 2,456 Operating expenses 5,505 5,145 11,348 10,201 Operating income 1,899 1,829 3,653 3,834 Other net benefit credits 50 48 100 91 Interest income 8 5 19 24 Interest expense (250) (243) (490) (488) Investment (loss) income (5) 7 1 12 Income before income taxes 1,702 1,646 3,283 3,473 Income tax expense 411 415 806 830 Net income before non-controlling interests 1,291 1,231 2,477 2,643 Less: Net income attributable to non-controlling interests 25 20 65 51 Net income attributable to the Company $ 1,266 $ 1,211 $ 2,412 $ 2,592 Net income per share attributable to the Company: – Basic $ 2.64 $ 2.46 $ 5.00 $ 5.27 – Diluted $ 2.63 $ 2.45 $ 4.99 $ 5.23 Average number of shares outstanding: – Basic 480 492 482 492 – Diluted 482 495 484 495 Shares outstanding at June 30, 478 492 478 492 The accompanying notes are an integral part of these unaudited consolidated statements.
Consolidated Statements of Income — second-quarter and first-half 2026 results · Filed 21/07/2026
We grew our adjusted operating income* by 11% and expanded adjusted margin for our 18th consecutive year*.
Proxy — issuer-reported adjusted operating income growth and margin expansion history · Filed 31/03/2026
In the first quarter of 2025, the Company changed its methodology to report adjusted operating income (loss), adjusted income, net of tax and adjusted EPS to exclude the impact of intangible amortization and other net benefit credits.
Proxy Exhibit A — 2025 change in adjusted earnings methodology · Filed 31/03/2026
The outflow of funds in 2024 related primarily to the acquisition of McGriff, where the Company paid $7.0 billion in cash consideration.
MD&A — $7 billion cash consideration for McGriff · Filed 09/02/2026
◾ We deployed approximately $850 million of capital over 20 acquisitions and investments, which contributed $255 million in revenue.
Proxy — 2025 acquisition and investment spending and contributed revenue · Filed 31/03/2026
For the six months ended June 30, 2026, the Company repurchased 8.7 million shares of its common stock for $1.5 billion.
Note 16 — first-half 2026 completed share repurchases · Filed 21/07/2026
The Company issued approximately 1.8 million and 2.9 million shares related to stock compensation and employee stock purchase plans for the six months ended June 30, 2026 and 2025, respectively.
Note 16 — first-half 2026 equity compensation and employee purchase plan issuance · Filed 21/07/2026
The following amounts are included in the consolidated statements of cash flows as operating and financing activities: For the Six Months Ended June 30, (In millions) 2026 2025 Operating: Contingent consideration payments for prior year acquisitions $ (54) $ (19) Acquisition/disposition related net charges for adjustments 21 30 Adjustments and payments related to contingent consideration $ (33) $ 11 Financing: Contingent consideration for prior year acquisitions $ (42) $ (7) Deferred consideration for prior year acquisitions (19) (36) Payments of deferred and contingent consideration for acquisitions $ (61) $ (43) Receipt of deferred and contingent consideration for dispositions $ 12 $ — For acquisitions completed during the first six months of 2026 and in prior years, remaining estimated future contingent payments of $216 million and deferred consideration payments of $165 million, are recorded in accounts payable and accrued liabilities or other liabilities in the consolidated balance sheets at June 30, 2026.
MD&A — acquisition-related payments and remaining deferred and contingent obligations · Filed 21/07/2026
• Delivered 10% revenue growth, achieved 4% underlying revenue growth; double-digit NOI growth of 11% on a GAAP basis; adjusted EPS growth of 9%, extending a fifteen-year track record of over 7% adjusted EPS growth, the longest among S&P 500 companies; and free cash flow growth of 25%, surpassing $5 billion for the first time.
Proxy — management performance assessment including reported free cash flow growth · Filed 31/03/2026
PSU awards are earned based on our achievement against financial performance objectives and the Company’s TSR versus S&P 500 constituents over a three-year performance period, both as determined by the Compensation Committee.
Executive Compensation — three-year PSU performance objectives and relative TSR · Filed 31/03/2026
All equity-based awards are subject to multi-year vesting requirements or performance periods with complete forfeiture of unvested awards upon a voluntary termination of employment by a senior executive (other than by reason of retirement) or termination of employment for cause.
Executive Compensation — multiyear vesting and forfeiture provisions · Filed 31/03/2026
Our senior executives may not sell shares acquired in connection with the distribution of stock units or exercise of stock options until and unless the specified multiple of base salary is reached and maintained (other than to meet tax withholding obligations or to pay the exercise price of stock options).
Executive Compensation — share-sale restrictions linked to ownership requirements · Filed 31/03/2026
As a result, the Compensation Committee determined that bonuses for our named executive officers would be above target for 2025, but down as compared to the prior-year bonus awards.
Executive Compensation — above-target 2025 bonuses, lower than prior-year awards · Filed 31/03/2026
All of the Company’s directors are independent, with the exception of our CEO, who is the only member of management serving on the Board.
Corporate Governance — board independence · Filed 31/03/2026
An independent director acts as Board chair.
Corporate Governance — independent board chair · Filed 31/03/2026
ü Our bylaws allow holders of at least 20% of the voting power of the Company’s outstanding common stock to call a special meeting.
Corporate Governance — shareholder right to call special meetings · Filed 31/03/2026
The Compensation Committee adopted an additional clawback policy for senior executives that provides recoupment of certain incentive compensation in the event a senior executive engages in specified detrimental conduct.
Executive Compensation — adopted detrimental-conduct clawback policy · Filed 31/03/2026
Item 4. Controls & Procedures. a. Evaluation of Disclosure Controls and Procedures Based on their evaluation, as of the end of the period covered by this report, the Company’s Chief Executive Officer and Chief Financial Officer have concluded that the Company’s disclosure controls and procedures (as defined in Rules 13a-15(e) or 15d-15(e) under the Securities Exchange Act of 1934) are effective.
Controls and Procedures — management conclusion on disclosure control effectiveness · Filed 21/07/2026
Total annualized savings are expected to be approximately $400 million.
MD&A — expected Thrive annualized savings · Filed 16/04/2026
| Notice of Annual Meeting and 2026 Proxy Statement Table of Contents Additional Information (Continued) Exhibit B As discussed more fully in our “Compensation Discussion and Analysis—Financial Services and General Industry Surveys” on page 50, the Compensation Committee reviewed competitive market data for executive compensation, effective April 1, 2025, compiled from two subsets of S&P 500 companies (as listed below) that participated in an executive compensation survey conducted by an independent compensation consulting firm.
Proxy Exhibit B — purpose of executive compensation survey company lists · Filed 31/03/2026
For the six months ended June 30, 2026, Guy Carpenter's revenue was $1.9 billion, an increase of 1%, or flat on an underlying basis.
MD&A — Guy Carpenter flat first-half 2026 underlying revenue · Filed 21/07/2026
