Change in control arrangements. We have “double-trigger” change in control agreements with our named executive officers to provide continuity of management in the event of an actual or potential change in control of BD. We have adopted a policy of eliminating excise tax gross-ups from future change in control agreements. Equity compensation awards made after January 1, 2015 also have a double-trigger accelerated vesting provision.
Use of independent consultant. The Compensation Committee uses an independent consultant to assist it in designing our compensation program and making compensation decisions. The independent consultant did not provide any services to BD or BD management in 2018, per the policy of the Compensation Committee.
Last year’s say-on-pay vote
Approximately 96% of the shares voted at last year’s annual meeting were cast in support of BD’s advisory vote on named executive officer compensation. The Compensation Committee views the results of this vote as broad general shareholder support for our executive compensation program. Based on our say-on-pay vote and the Compensation Committee’s ongoing benchmarking of our compensation policies and practices, the Compensation Committee believes that our compensation program effectively aligns the interests of our named executive officers with those of our shareholders and the long-term goals of BD. Accordingly, the Compensation Committee did not make any significant changes to our program in 2018 as a result of last year’s say-on-pay vote.
Changes to our program in 2018
For 2018, the Compensation Committee revised the group of peer companies used to benchmark compensation practices to add two companies, Abbott Laboratories and Danaher Corporation, which are relatively larger than most of the other companies included in the peer group. This change was made to reflect the significantly increased size and complexity of BD’s business following our recent acquisitions of CareFusion Corporation (“CareFusion”) and Bard.
In addition, starting with Performance Unit grants made in 2018, the Compensation Committee changed the group of companies used to measure relative total shareholder return (“TSR”). Beginning with the 2018 grant, relative TSR performance will be measured by reference to those healthcare equipment and life companies included in the S&P 500 Healthcare Index. This change increases the number of companies against which BD’s TSR is measured, compared to the custom peer group used for previous grants, which reduces the potential volatility in relative TSR performance that can arise when comparing BD’s performance to a smaller group of companies.
2018 operating performance and executive compensation decisions
2018 was another transformational year for BD, as we completed the acquisition of Bard, a leader in the fields of vascular, urology, oncology and surgical specialty products. The Bard acquisition uniquely positions BD to improve both the process of care and the treatment of disease for patients and healthcare providers. While the acquisition and integration of Bard required significant management attention throughout the year, BD still delivered strong financial and operational performance in 2018, the highlights of which are described below:
Reported revenues increased 32.2% from the prior year, primarily due to the Bard acquisition. On a comparable, currency-neutral basis that includes the revenues of Bard in the current and prior year, our revenues grew 5.8%, which exceeded our expectations at the time we acquired Bard.
While reported diluted earnings per share decreased about 87%, primarily as a result of expenses relating to the Bard and other acquisitions, as well as additional tax expense resulting from U.S. tax reform, our adjusted diluted earnings per share grew 16.1%, or 12.3% on a currency-neutral basis, slightly above our expectations at the time of the Bard acquisition.
Substantial progress was made on the integration of Bard upon the completion of the acquisition, including creating a new "Interventional" segment and the recognition of cost synergies.
As part of our commitment to reduce our outstanding long-term debt, we retired $1.2 billion of debt since the completion of the Bard acquisition.