Edgar Filing: BECTON DICKINSON & CO

Definitive Proxy Statement

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 14A

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Exchange Act of 1934 (Amendment No. )

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LOGO

Becton, Dickinson and Company

1 Becton Drive

Franklin Lakes, New Jersey 07417-1880

www.bd.com

December 22, 2011

Dear Fellow Shareholders:

You are cordially invited to attend the 2012 Annual Meeting of Shareholders of Becton, Dickinson and Company (“BD”) to be held at 1:00 p.m. EST on Tuesday, January 31, 2012 at the Hilton Short Hills, 41 John F. Kennedy Parkway, Short Hills, New Jersey. You will find directions to the meeting on the back cover of the accompanying proxy statement.

The notice of meeting and proxy statement describe the matters to be acted upon at the meeting. We also will report on matters of interest to BD shareholders.

Your vote is important. Whether or not you plan to attend the Annual Meeting in person, we encourage you to vote so that your shares will be represented and voted at the meeting. You may vote by proxy on the Internet or by telephone, or by completing and mailing the enclosed proxy card in the return envelope provided. You may also vote in person at the Annual Meeting.

Thank you for your continued support of BD.

Sincerely,

EDWARD J. LUDWIG

Chairman

NOTICE OF ANNUAL MEETING OF SHAREHOLDERS

Becton, Dickinson and Company

1 Becton Drive

Franklin Lakes, New Jersey 07417-1880

December 22, 2011

The 2012 Annual Meeting of Shareholders of Becton, Dickinson and Company (“BD”) will be held as follows:


DATE:		Tuesday, January 31, 2012
TIME:		1:00 p.m. EST
LOCATION:		Hilton Short Hills 41 John F. Kennedy Parkway Short Hills, New Jersey
PURPOSE:		To consider and act upon the following proposals:
		1. The election as directors of the fourteen nominees named in the attached proxy statement for a one-year term;
		2. The ratification of the selection of the independent registered public accounting firm;
		3. An advisory vote on executive compensation;
		4. A shareholder proposal relating to cumulative voting; and
		5. Such other business as may properly come before the meeting.

Shares represented by properly executed proxies will be voted in accordance with the instructions specified therein. Shares represented by properly executed proxies that do not provide specific voting instructions will be voted in accordance with the recommendations of the Board of Directors set forth in this proxy statement.

Important Notice Regarding the Availability of Proxy Materials for the 2012 Annual Meeting of Shareholders to be held on January 31, 2012. BD’s proxy statement and 2011 Annual Report, which includes BD’s consolidated financial statements, are available at www.bd.com/investors/.

Shareholders of record at the close of business on December 12, 2011 will be entitled to attend and vote at the meeting.

By order of the Board of Directors,

GARY DEFAZIO

Vice President and Corporate Secretary

It is important that your shares be represented and voted,

whether or not you plan to attend the meeting.

YOU CAN VOTE BY PROXY OR SUBMIT VOTING INSTRUCTIONS IN

ONE OF THREE WAYS:

VIA THE INTERNET:

Visit the website noted on your proxy/voting instruction card.

BY TELEPHONE:

Use the toll-free telephone number noted on your proxy/voting instruction card.

BY MAIL:

Promptly return your signed and dated proxy/voting instruction card in the enclosed envelope.

Table of Contents


GENERAL INFORMATION			1
Proxy Solicitation			1
Shareholders Entitled to Vote; Attendance at the Meeting			1
Quorum; Required Vote			1
How to Vote			2
Revocation of Proxies or Change of Instructions			2
Other Matters			3
OWNERSHIP OF BD COMMON STOCK			3
Securities Owned by Certain Beneficial Owners			3
Securities Owned by Directors and Management			3
BD Common Stock			4
Equity Compensation Plan Information			5
Section 16(a) Beneficial Ownership Reporting Compliance			6
PROPOSAL 1. ELECTION OF DIRECTORS			7
Nominees for Director			7
BOARD OF DIRECTORS			12
The Board and Committees of the Board			12
Committee Membership and Function			12
Board, Committee and Annual Meeting Attendance			15
Non-Management Directors’ Compensation			16
Communication With Directors			18
CORPORATE GOVERNANCE			19
Corporate Governance Principles			19
Board Leadership Structure			19
Board’s Oversight of Risk			19
Director Nomination Process			20
Significant Governance Practices			21
Director Independence; Policy Regarding Related Person Transactions			22
REPORT OF THE COMPENSATION AND BENEFITS COMMITTEE			25
COMPENSATION DISCUSSION AND ANALYSIS			27
COMPENSATION OF NAMED EXECUTIVE OFFICERS			41
Summary Compensation Table			41
Information Regarding Plan Awards in Fiscal Year 2011			44
Outstanding Equity Awards			46
Stock Option Exercises and Vesting of Stock Units			48
Other Compensation			48
Retirement Plan			49
Deferred Compensation			51
Payments Upon Termination of Employment or Change of Control			52
PROPOSAL 2. RATIFICATION OF SELECTION OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM			56
Report of the Audit Committee			57
PROPOSAL 3. ADVISORY VOTE ON EXECUTIVE COMPENSATION			58
PROPOSAL 4. SHAREHOLDER PROPOSAL ON CUMULATIVE VOTING			58
SHAREHOLDER PROPOSALS OR DIRECTOR NOMINATIONS FOR 2013 ANNUAL MEETING			59
DIRECTIONS TO THE HILTON SHORT HILLS			Back Cover

PROXY STATEMENT

2012 ANNUAL MEETING OF SHAREHOLDERS

Tuesday, January 31, 2012

BECTON, DICKINSON AND COMPANY

1 Becton Drive

Franklin Lakes, New Jersey 07417-1880

GENERAL INFORMATION

Proxy Solicitation

These proxy materials are being mailed or otherwise sent to shareholders of Becton, Dickinson and Company (“BD”) on or about December 22, 2011 in connection with the solicitation of proxies by the Board of Directors for BD’s Annual Meeting of Shareholders (the “2012 Annual Meeting”) to be held at 1:00 p.m. EST on Tuesday, January 31, 2012 at the Hilton Short Hills, 41 John F. Kennedy Parkway, Short Hills, New Jersey. Important Notice Regarding the Availability of Proxy Materials for the 2012 Annual Meeting of Shareholders to be held on January 31, 2012. This proxy statement and BD’s 2011 Annual Report are also available at www.bd.com/investors/.

Directors, officers and other BD associates also may solicit proxies by telephone or otherwise. Brokers and other nominees will be requested to solicit proxies or authorizations from beneficial owners and will be reimbursed for their reasonable expenses. BD has retained MacKenzie Partners, Inc. to assist in soliciting proxies for a fee not to exceed $25,000 plus expenses. The cost of soliciting proxies will be borne by BD.

Shareholders Entitled to Vote; Attendance at the Meeting

Shareholders of record at the close of business on December 12, 2011 are entitled to notice of, and to vote at, the meeting. As of such date, there were 213,604,337 shares of BD common stock outstanding, each entitled to one vote.

If your shares are held in the name of a bank, broker or other nominee (also known as “street name”) and you wish to attend the meeting, you must present proof of ownership as of the record date, such as a current bank or brokerage account statement, to be admitted. BD also may request appropriate identification as a condition of admission.

Quorum; Required Vote

The holders of a majority of the shares entitled to vote at the meeting must be present in person or represented by proxy to constitute a quorum. Directors are elected by a majority of the votes cast at the meeting (Proposal 1). This means that a director nominee will be elected to the Board only if the number of votes cast for the nominee exceeds the number of votes cast against that nominee. Approval of Proposals 2, 3 and 4 requires the affirmative vote of a majority of the votes cast at the meeting. Under New Jersey law, abstentions and shares that brokers do not have the authority to vote in the absence of timely instructions from the beneficial owners will not be counted as votes cast, and, accordingly, will have no effect on the outcome of the vote for any of the Proposals. Proposal 2 is a “discretionary item”, and New York Stock Exchange (“NYSE”) member brokers that do not receive instructions on how to vote from beneficial owners may cast those votes in their discretion.

How to Vote

Shareholders of record may cast their votes at the meeting. In addition, shareholders of record may cast their vote by proxy, and participants in the BD plans described below may submit their voting instructions, by:

(1) using the Internet and voting at the website listed on the enclosed proxy/voting instruction card (the “proxy card”);

(2) using the toll-free telephone number listed on the enclosed proxy card; or

(3) signing, completing and returning the enclosed proxy card in the enclosed postage-paid envelope.

Votes cast through the Internet and telephone votes are authenticated by use of a personal identification number. This procedure allows shareholders to appoint a proxy, and the various plan participants to provide voting instructions, and to confirm that their actions have been properly recorded. Specific instructions to be followed are set forth on the enclosed proxy card. If you vote through the Internet or by telephone, you do not need to return your proxy card. In order to be timely processed, voting instructions submitted by participants in BD’s Global Share Investment Program (“GSIP”) must be received by 12:00 p.m. EST on January 25, 2012, and voting instructions submitted by participants in all other BD plans must be received by 12:00 p.m. EST on January 27, 2012. All proxies submitted by record holders through the Internet or by telephone must be received by 11:00 a.m. EST on January 31, 2012.

If you are the beneficial owner of shares held in “street name,” you have the right to direct your bank, broker or other nominee on how to vote your shares by using the voting instruction form provided to you by them, or by following their instructions for voting through the Internet or by telephone. In the alternative, you may vote in person at the meeting if you obtain a valid proxy from your bank, broker or other nominee and present it at the meeting.

Shares represented by properly executed proxies will be voted in accordance with the instructions specified therein. Shares represented by properly executed proxies that do not specify voting instructions will be voted in accordance with the recommendations of the Board of Directors set forth in this proxy statement.

Savings Incentive Plan (SIP)

Participants in SIP, BD’s 401(k) plan, may instruct the SIP trustee how to vote all shares of BD common stock allocated to their SIP accounts. The SIP trustee will vote the SIP shares for which it has not received instructions in the same proportion as the SIP shares for which it has received instructions.

Participants in Other Plans

Participants in BD’s Deferred Compensation and Retirement Benefit Restoration Plan (“DCP”), the 1996 Directors’ Deferral Plan (“DDP”), and GSIP (if so provided under the terms of the local country GSIP plan) may provide voting instructions for all shares of BD common stock allocated to their plan accounts. The trustees of these plans will vote the plan shares for which they have not received instructions in the same proportion as the plan shares for which they have received instructions.

Proxies representing shares of BD common stock held of record also will serve as proxies for shares held under the Direct Stock Purchase Plan sponsored and administered by Computershare Trust Company, N.A. and any shares of BD common stock allocated to participants’ accounts under the plans mentioned above, if the registrations are the same. Separate mailings will be made for shares not held under the same registrations.

Revocation of Proxies or Change of Instructions

A proxy given by a shareholder of record may be revoked at any time before it is voted by sending written notice of revocation to the Corporate Secretary of BD at the address set forth above, by delivering a proxy (by

one of the methods described above under the heading “How to Vote”) bearing a later date, or by voting in person at the meeting. Participants in the plans described above may change their voting instructions by delivering new voting instructions by one of the methods described above under the heading “How to Vote.”

If you are the beneficial owner of shares held in “street name,” you may submit new voting instructions in the manner provided by your bank or broker or other nominee, or you may vote in person at the meeting in the manner described above under the heading “How to Vote.”

Other Matters

The Board of Directors is not aware of any matters to be presented at the meeting other than those set forth in the accompanying notice. If any other matters properly come before the meeting, the persons named in the proxy card will vote on such matters in accordance with their best judgment.

OWNERSHIP OF BD COMMON STOCK

Securities Owned by Certain Beneficial Owners

The following table sets forth as of September 30, 2011, information concerning those persons known to BD to be the beneficial owner of more than 5% of BD’s outstanding common stock. This information is as reported by such persons in their Schedule 13G filings with the Securities and Exchange Commission (“SEC”).


Name and Address of Beneficial Owner	Amount and Nature of Beneficial Ownership			Percent of Class
State Street Corporation State Street Bank and Trust Company, Trustee State Street Financial Center One Lincoln Street Boston, MA 02111		12,911,425	(1)		5.9	%

(1)	The owner has shared investment power and shared voting power with respect to all of these shares.

Securities Owned by Directors and Management

The following table sets forth as of December 1, 2011 information concerning the beneficial ownership of BD common stock by (i) each director, (ii) the executive officers named in the Summary Compensation Table on page 41, and (iii) all BD directors and executive officers as a group. In general, “beneficial ownership” includes those shares that a director or executive officer has the power to vote or transfer, including shares that may be acquired under outstanding equity compensation awards or otherwise within 60 days.

No individual director or executive officer owns more than 1% of the outstanding BD common stock. Together, the directors and executive officers, as a group, owned approximately 1.3% of the outstanding BD common stock as of December 1, 2011. Except as indicated in the footnotes to the table, each person has the sole power to vote and transfer the shares he or she beneficially owns.

BD COMMON STOCK


	Amount and Nature of Beneficial Ownership
Name	Shares Owned Directly and Indirectly (1)		Shares That May Be Acquired Within 60 days (2)		Total Shares Beneficially Owned		Percentage of Class
Basil L. Anderson		5,977		14,901		20,878		*
Henry P. Becton, Jr. (3)		247,535		23,640		271,175		*
Gary M. Cohen		78,927		150,109		229,036		*
Edward F. DeGraan		10,120		18,532		28,652		*
David V. Elkins		3,687		29,380		33,067		*
Vincent A. Forlenza		79,019		413,581		492,600		*
Claire M. Fraser-Liggett		0		9,347		9,347		*
Christopher Jones		1,185		2,996		4,181		*
William A. Kozy		65,010		240,829		305,839		*
Marshall O. Larsen		1,712		7,652		9,364		*
Edward J. Ludwig		268,510		727,308		995,818		*
Adel A.F. Mahmoud		114		9,347		9,461		*
Gary A. Mecklenburg		3,972		14,901		18,873		*
Cathy E. Minehan		4,000		7,652		11,652		*
James F. Orr		11,863		18,532		30,395		*
Willard J. Overlock, Jr.		34,553		23,640		58,193		*
Bertram L. Scott		9,491		21,313		30,804		*
Alfred Sommer		12,914		18,532		31,446		*
Directors and executive officers as a group (22 persons)		876,856		1,992,188		2,869,044		1.3	%

*	Represents less than 1% of the outstanding BD common stock.

(1)

Includes shares held directly, and, with respect to executive officers, indirect interests in BD common stock held under the SIP and the DCP, and, with respect to the non-management directors, indirect interests in BD common stock held under the DDP. Additional information on certain of these plans appears on pages 5-6. None of the shares listed in this column have been pledged as security.

(2)

Includes shares under outstanding stock options or stock appreciation rights that are exercisable or become exercisable within 60 days. Also includes, with respect to those executive officers who are retirement-eligible (including Messrs. Ludwig, Forlenza and Kozy) (i) unvested stock options or stock appreciation rights that become vested upon retirement, and (ii) shares issuable under restricted stock units upon retirement. Also includes, with respect to each non-management director, shares issuable under restricted stock units upon the director’s termination of service on the Board, as more fully described in “Non-Management Directors’ Compensation—Equity Compensation” on page 16.

(3)

Includes 217,290 shares held by trusts of which Mr. Becton is a co-trustee with shared investment and voting power or held by a limited liability company owned by one of such trusts. Does not include 37,166 shares owned by Mr. Becton’s spouse, or 108,712 shares held in trusts for the benefit of his children, and as to each of which he disclaims beneficial ownership.

Equity Compensation Plan Information

The following table provides certain information as of September 30, 2011 regarding BD’s equity compensation plans.


Plan Category	(a) Number of securities to be issued upon exercise of outstanding options, warrants and rights			(b) Weighted-average exercise price of outstanding options, warrants and rights(1)		(c) Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a))
Equity compensation plans approved by security holders		15,857,696	(2)	$	63.46		7,929,828	(3)
Equity compensation plans not approved by security holders		2,070,156	(4)	$	34.02		0	(5)

Total		17,927,852		$	63.41		7,929,828

(1)

Shares issuable pursuant to outstanding awards of Performance Units and other restricted stock units under the BD 2004 Employee and Director Equity-Based Compensation Plan (the “2004 Plan”) and the BD Stock Award Plan, as well as shares issuable under BD’s 1996 Directors’ Deferral Plan, Deferred Compensation and Retirement Benefit Restoration Plan and Global Share Investment Program (“GSIP”), are not included in the calculation of weighted-average exercise price, as there is no exercise price for these shares.

(2)

Includes (i) 12,461,175 shares issuable under outstanding stock options and stock appreciation rights and (ii) 3,396,521 shares distributable under Performance Unit awards and other restricted stock unit awards granted under the 2004 Plan and Stock Award Plan (with Performance Unit awards listed at target payout amounts).

(3)	Includes 7,717,344 shares available for issuance under the 2004 Plan, and 212,484 shares available for issuance under the 1994 Restricted Stock Plan for Non-Employee Directors.

(4)

Includes 23,213 shares issuable pursuant to outstanding stock options granted under BD’s Non-Employee Directors 2000 Stock Option Plan. Also includes 97,628 shares issuable under BD’s 1996 Directors’ Deferral Plan, 508,144 shares issuable under BD’s Deferred Compensation and Retirement Benefit Restoration Plan, and 1,441,171 shares issuable under the GSIP, based on participant account balances as of September 30, 2011.

(5)

Does not include shares issuable under the 1996 Directors’ Deferral Plan, the Deferred Compensation and Retirement Benefit Restoration Plan or the GSIP. There are no limits on the number of shares issuable under these plans, and the number of shares that may become issuable will depend on future elections made by plan participants.

Deferred Compensation and Retirement Benefit Restoration Plan. Information regarding the Deferred Compensation and Retirement Benefit Restoration Plan can be found beginning on page 50 of this proxy statement. The shares held in the plan as of September 30, 2011 include 141,075 shares acquired by participants through cash deferrals and 367,069 shares deferred under participants’ equity compensation awards. In the event a participant elects to have cash compensation deferred in a BD common stock account, the participant’s account is credited with a number of shares based on the prevailing market price of the BD common stock. The cash deferred by the participant is used to purchase the shares of BD common stock on the open market, which are then held in a trust.

Global Share Investment Program. BD maintains a Global Share Investment Program (“GSIP”) for its non-U.S. associates in certain jurisdictions outside of the U.S. The purpose of the GSIP is to provide non-U.S. associates with a means of saving on a regular and long-term basis and acquiring a beneficial interest in BD common stock. Participants may contribute a portion of their base pay, through payroll deductions, to the

GSIP for their account. BD provides matching funds of up to 3% of a participant’s base pay through contributions to the participant’s plan account. Contributions to the GSIP are used to purchase shares of BD common stock on the open market, which are then held in a trust.

A participant may withdraw the vested portion of the participant’s account, although such withdrawals must be in the form of a cash payment if the participant is employed by BD at the time of withdrawal. Following termination of service, withdrawals will be paid in either cash or shares, at the election of the participant.

Non-Employee Directors 2000 Stock Option Plan. Non-management directors formerly received grants of nonqualified stock options under the Non-Employee Directors 2000 Stock Option Plan (the “Directors Stock Option Plan”), which provided for the granting of nonqualified stock options at each Annual Meeting of Shareholders to each non-management director elected at or continuing to serve after such meeting. Options are no longer granted under the Directors Stock Option Plan. The exercise price of stock options granted under the Directors Stock Option Plan was the fair market value of the BD common stock on the date of grant. Each option granted under the Directors Stock Option Plan has a term of 10 years from its date of grant. The options granted under the Directors Stock Option Plan have vesting periods of three to four years, depending on the year of grant.

1996 Directors’ Deferral Plan. The 1996 Directors’ Deferral Plan (the “Directors’ Deferral Plan”) allows non-management directors to defer receipt, in an unfunded cash account or a BD common stock account, of all or part of their annual retainer and other cash fees. In the event a director elects to have fees deferred in a BD common stock account, the director’s account is credited with a number of shares based on the market price of the BD common stock on the due date of such payment. The cash fees deferred by the director are used to purchase the shares of BD common stock on the open market, which are then held in a trust. Directors may also defer receipt of restricted stock units under the plan. The number of shares credited to the BD common stock accounts of participants is adjusted periodically to reflect the payment and reinvestment of dividends on the common stock. Participants may elect to have amounts held in a cash account converted into a BD common stock account. The Directors’ Deferral Plan is not qualified, and participants have an unsecured contractual commitment of BD to pay the amounts due under the Directors’ Deferral Plan. When such payments are due, the cash and/or common stock will be distributed from BD’s general assets.

Section 16(a) Beneficial Ownership Reporting Compliance

Section 16(a) of the Securities Exchange Act of 1934 requires BD’s directors and executive officers to file initial reports of their ownership of BD’s equity securities and reports of changes in such ownership with the SEC and the NYSE. Directors and executive officers are required by SEC regulations to furnish BD with copies of all Section 16(a) forms they file with respect to BD securities. Based solely on a review of copies of such forms and written representations from BD’s directors and executive officers, BD believes that, for the period from October 1, 2010 through September 30, 2011, all of its directors and executive officers were in compliance with the reporting requirements of Section 16(a), except that one report for three transactions by David T. Durack and one report for one transaction by Willard J. Overlock, Jr. were inadvertently filed late.

Proposal 1. ELECTION OF DIRECTORS

All members of our Board are elected to serve a term of one year and until their successors have been elected and qualified. Cathy Minehan has chosen to retire from the Board and will not stand for re-election. All of the nominees for election have consented to being named in this proxy statement and to serve if elected. Edward J. Ludwig has previously announced his plans to retire from BD in June 2012, at which time he would retire from the Board. Presented below is biographical information for each of the nominees.

BD directors have a variety of backgrounds, which reflects the Board’s continuing objective to achieve a diversity of viewpoint, experience, knowledge, ethnicity and gender. As more fully discussed below, director nominees are considered on the basis of a range of criteria, including their business knowledge and background, prominence and reputation in their primary fields of endeavor, global business perspective and commitment to strong corporate citizenship. They must also have demonstrated experience and ability that is relevant to the Board’s oversight role with respect to BD’s business and affairs. Each director’s biography includes the particular experience and qualifications that led the Board to conclude that the director should serve on the Board.

NOMINEES FOR DIRECTOR


		Basil L. Anderson, 66, has been a director since 2004. From 2001 until his retirement in 2006, he served as Vice Chairman of Staples, Inc., a supplier of office products. Prior thereto, he was Executive Vice President – Finance and Chief Financial Officer of Campbell Soup Company. Mr. Anderson also is a director of Hasbro, Inc., Moody’s Corporation and Staples, Inc. Mr. Anderson has an extensive business and financial background as both an operating executive and as a chief financial officer of major multinational public companies. His experience includes strategic, business and financial planning and operations, international operations, and service as a director for numerous public companies in different industries.


		Henry P. Becton, Jr., 68, has been a director since 1987. Since 2007, he has served as Vice Chairman of the Board of Trustees of WGBH Educational Foundation, a producer and broadcaster of public television, radio and Internet programs, and books and other educational materials. He served as President of WGBH Educational Foundation from 1984 to October 2007. Mr. Becton also serves as Lead Director of Belo Corporation, is a director of Public Radio International and the PBS Foundation, and is a director/trustee of various DWS mutual funds. Mr. Becton possesses a broad range of operational, financial and corporate governance experience developed through his professional and board-related activities in a variety of contexts. This broad background is coupled with Mr. Becton’s extensive knowledge of BD, which provides him with a unique perspective on BD.


		Edward F. DeGraan, 68, has been a director since 2003. In 2006, he retired as Vice Chairman – Gillette of the Procter & Gamble Company, a manufacturer of consumer products. Prior thereto, he was Vice Chairman of The Gillette Company, and served as its President and Chief Operating Officer from July 2000 until November 2003. He also served as Acting Chief Executive Officer of Gillette from October 2000 to February 2001. Mr. DeGraan also is a director of Amica Mutual Insurance Company and a Senior Advisor of Centerview Partners, L.P. Mr. DeGraan brings extensive operational, manufacturing and executive experience in a consumer industry with a strong manufacturing base. He possesses a broad background in strategic, business and financial planning and operations, deepened by his global perspective developed through his long tenure with a multinational company.


		Vincent A. Forlenza, 58, joined the Board on October 1, 2011. On that date, he was also elected BD’s Chief Executive Officer. Mr. Forlenza has served as BD’s President since January 2009. Mr. Forlenza also served as Chief Operating Officer from July 2010 until his election as Chief Executive Officer. From June 2006 to January 2009, Mr. Forlenza served as Executive Vice President. Mr. Forlenza has been with BD for over thirty years in a number of different capacities, including strategic planning, marketing, general management in all three of BD’s segments, and overseas roles. Mr. Forlenza brings to the Board extensive business and industry experience, and provides the Board with unique perspective on BD’s strategy and operations, particularly in the area of new product development.


		Claire M. Fraser-Liggett, Ph.D, 56, has been a director since 2006. Since 2007, she has been Director of the Institute for Genome Sciences and a Professor of Medicine at the University of Maryland School of Medicine in Baltimore, Maryland. From 1998 to 2007, she served as President and Director of The Institute for Genomic Research, a not-for-profit center dedicated to deciphering and analyzing genomes. Dr. Fraser-Liggett is a prominent scientist with a strong background in infectious diseases and molecular diagnostics, including the development of novel diagnostics and vaccines. She also brings considerable managerial experience in her field.


		Christopher Jones, 56, has been a director since 2010. Mr. Jones retired in 2001 as Chief Executive Officer of JWT Worldwide (previously known as J. Walter Thompson), an international marketing firm. Since 2002, Mr. Jones has been Operating Partner and director at Cognetas LLP, a pan-European private equity firm. He has been the non-executive Chairman of Results International Group since 2002. He also is a member of the European Advisory Board of Nardello & Co., chair of the board of The Pavilion Clinic, and a member of the Health Advisory Board of The Johns Hopkins University Bloomberg School of Public Health. Mr. Jones contributes an important international perspective based on his distinguished career as a marketing leader and head of a global marketing firm. He offers substantial marketing, strategic and managerial expertise derived from his broad range of activities in the field.


		Marshall O. Larsen, 63, has been a director since 2007. He is Chairman, President and Chief Executive Officer of Goodrich Corporation, a supplier of systems and services to the aerospace and defense industry. Mr. Larsen also is a director of Lowe’s Companies, Inc., and is a member of The Business Council. As a veteran chief executive officer of a public company, Mr. Larsen offers the valuable perspective of an individual with highly-developed executive leadership and financial and strategic management skills in a global manufacturing company. These qualities reflect considerable domestic and international business and financial experience.


		Edward J. Ludwig, 60, has been Chairman of BD since 2002, and was BD’s Chief Executive Officer and President from 2000 through September 2011. Mr. Ludwig also is a director of Aetna Inc. and Xylem Inc. He is a member of the Board of Trustees of the College of the Holy Cross, Chairman of the Hackensack (NJ) University Medical Center Advisory Board, and a member of the Board of Directors of Project HOPE. He also is a former member of the Board of Directors and former Chairman of the Advanced Medical Technology Association (AdvaMed), an international medical technology trade association. Mr. Ludwig brings to the Board significant executive-level leadership and business and industry expertise. His extensive experience and sustained leadership in the field of medical technology in a variety of senior executive, strategic, financial and operational roles, all with BD, give Mr. Ludwig a unique perspective on BD’s strategy and operations and on the medical technology industry. This is supplemented by his extensive involvement with the industry, where he has been a leading voice for many years.


		Adel A.F. Mahmoud, M.D., Ph.D, 70, has been a director since 2006. In 2006, Dr. Mahmoud retired as Chief Medical Advisor, Vaccines and Infectious Diseases and member of the Management Committee of Merck & Co., Inc., a pharmaceutical company. From 1999 to 2005, he served as President, Merck Vaccines. In 2007, he joined Princeton University as Professor, Department of Molecular Biology and the Woodrow Wilson School of Public and International Affairs. Dr. Mahmoud also is a director of Sanaria, Inc., a malaria vaccine development organization, and GenVec, Inc., a developer of gene-based therapeutic drugs and vaccines. Dr. Mahmoud is a distinguished scientist, physician and business leader with broad and deep knowledge of infectious diseases and vaccines. He brings strong technical, strategic and operational experience as a former senior executive with a major global pharmaceutical company, as well as an extensive academic background.


		Gary A. Mecklenburg, 65, has been a director since 2004. In 2006, he retired as President and Chief Executive Officer of Northwestern Memorial HealthCare, the parent corporation of Northwestern Memorial Hospital, a position he had held since 1986. He also served as President of Northwestern Memorial Hospital from 1985 to 2002. He is currently an Executive Partner of Waud Capital Partners, L.L.C., a private equity investment firm. Mr. Mecklenburg is also a director of Acadia Healthcare Company, Inc. Mr. Mecklenburg’s long tenure in hospital administration affords him a broad perspective on the many facets of the delivery of healthcare and a deep knowledge of healthcare financing and administration. As the former leader of a major teaching hospital, Mr. Mecklenburg possesses strong executive management, financial, strategic and operational knowledge as applied in a healthcare setting.


		James F. Orr, 66, has been a director since 2000. In 2007, he retired as Chairman of the Board of Convergys Corporation, a provider of customer management, employee care and outsourced billing services, a position he had held since 2000. He also served as Convergys’ Chief Executive Officer from 1998 until his retirement in 2007, and also as its President from 1998 to 2005. Mr. Orr also is a director of Ohio National Financial Services, Inc. Mr. Orr contributes the important insights of a former chief executive officer of a public company. His background reflects extensive managerial, strategic, operational and financial experience from the perspective of a service industry. He also possesses a depth of understanding of corporate governance and enterprise risk management.


		Willard J. Overlock, Jr., 65, has been a director since 1999. He retired in 1996 as a partner in Goldman, Sachs & Co., where he served as a member of its Management Committee, and retains the title of Senior Director to The Goldman Sachs Group, Inc. Mr. Overlock also is a special partner with Cue Ball Group, a trustee of Rockefeller University and a member of the Board of Directors of The Albert and Mary Lasker Foundation. Mr. Overlock has broad financial and investment banking experience based on his senior leadership roles in these areas. He contributes financial and transactional expertise and acumen in mergers and acquisitions and complex financial transactions.


		Bertram L. Scott, 60, has been a director since 2002. Mr. Scott will continue in his role as President, U.S. Commercial of CIGNA Corporation, a position he has held since joining that organization in June 2010, until December 31, 2011. Prior thereto, he served as Executive Vice President of TIAA-CREF from 2000 to June 2010, and as President and Chief Executive Officer of TIAA-CREF Life Insurance Company from 2000 to 2007. Mr. Scott possesses strong strategic, operational and financial experience from the variety of executive roles in which he has served during his career. He brings experience in corporate governance and business expertise in the insurance and healthcare fields.

Alfred Sommer, M.D., M.H.S., 69, has been a director since 1998. He is Professor of International Health, Epidemiology, and Ophthalmology at The Johns Hopkins University (“JHU”) Bloomberg School of Public Health (the “Bloomberg School”) and the JHU School of Medicine, positions he has held since 1986. He is Dean Emeritus of the Bloomberg School, having served as Dean from 1990 to 2005. He is a member of the National Academy of Sciences and the Institute of Medicine. He is a recipient of the Albert Lasker Award for Medical Research. Dr. Sommer also is a director of T. Rowe Price Group, Inc., and Chairman of the Board of Directors of The Albert and Mary Lasker Foundation.

Dr. Sommer is a renowned clinician, researcher and academic administrator with substantial and broad experience in medicine and the public health field, coupled with valuable board experience in the for-profit and nonprofit realms. These attributes enable him to offer deep insights into global healthcare issues and medical technology.

THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR EACH OF THE NOMINEES FOR DIRECTOR.

BOARD OF DIRECTORS

The Board and Committees of the Board

BD is governed by a Board of Directors that currently consists of 15 members, 13 of whom have been determined by the Board to be independent. The Board has established four operating Committees: the Audit Committee; the Compensation and Benefits Committee; the Corporate Governance and Nominating Committee and the Science, Innovation and Technology Committee. These Committees meet regularly. The Board has also established an Executive Committee that meets only as needed. Committee meetings may be called by the Committee chair, the Chairman of the Board or a majority of Committee members. The Board has adopted written charters for each of the Committees that are posted on BD’s website at www.bd.com/investors/corporate_governance/. Printed copies of these charters, BD’s 2011 Annual Report on Form 10-K, and BD’s reports and statements filed with or furnished to the SEC, may be obtained, without charge, by contacting the Corporate Secretary, BD, 1 Becton Drive, Franklin Lakes, New Jersey 07417-1880, telephone 201-847-6800.

Committee Membership and Function

Set forth below is a summary description of each of the Board’s operating Committees.

AUDIT COMMITTEE

Function

•

Retains and reviews the qualifications, independence and performance of BD’s registered public accounting firm (the “independent auditors”).

•

Reviews BD’s public financial disclosures and financial statements, and its accounting principles, policies and practices; the scope and results of the annual audit by the independent auditors; BD’s internal audit process; and the effectiveness of BD’s internal control over financial reporting.

•

Reviews BD’s guidelines and policies relating to enterprise risk assessment and risk management, and management’s plan for risk mitigation or remediation.

•

Oversees BD’s ethics and enterprise compliance practices.

•

Reviews financial strategies regarding currency, interest rates and use of derivatives, and reviews BD’s insurance program.

•

Functions as a qualified legal compliance committee, if necessary.

Members

Basil L. Anderson—Chair

Christopher Jones

Marshall O. Larsen

Gary A. Mecklenburg

James F. Orr

Bertram L. Scott

The Board has determined that the members of the Audit Committee meet the independence and financial literacy and expertise requirements of the NYSE for audit committee members. The Board also has determined that each of Messrs. Anderson, Larsen, Orr and Scott qualifies as an “audit committee financial expert” under the rules of the SEC. Mr. Anderson currently serves on the audit committees of three other public companies. The Board has reviewed Mr. Anderson’s obligations as a member of the other audit committees and determined that his simultaneous service on those other audit committees does not impair his ability to effectively serve on BD’s Audit Committee. The Audit Committee regularly meets separately with the internal and external auditors to ensure full and frank communications with the Audit Committee.

COMPENSATION AND BENEFITS COMMITTEE

Function

•

Reviews BD’s compensation and benefits policies, recommends the compensation of the Chief Executive Officer to the independent members of the Board for their approval, and approves the compensation of BD’s other executive officers.

•

Approves all employment, severance and change of control agreements of BD with executive officers.

•

Serves as the granting and administrative committee for BD’s equity compensation plans.

•

Oversees certain BD benefit plans.

Members

Edward F. DeGraan—Chair

Basil L. Anderson

Marshall O. Larsen

James F. Orr

Willard J. Overlock, Jr.

Bertram L. Scott

The Board has determined that each member of the Compensation and Benefits Committee meets the independence requirements of the NYSE.

Procedure for Determining Executive Compensation

The Compensation and Benefits Committee oversees the compensation program for the named executive officers listed in the Summary Compensation Table on page 41 and for BD’s other executive officers. The Compensation and Benefits Committee recommends compensation actions regarding the Chief Executive Officer to the full Board and is delegated the authority to take compensation actions with respect to BD’s other executive officers. The Compensation and Benefits Committee may not delegate these responsibilities to another Committee, individual director or member of management.

Role of Management

The Compensation and Benefits Committee’s meetings are typically attended by BD’s Chief Executive Officer, Senior Vice President—Human Resources and others, who support the Compensation and Benefits Committee in fulfilling its responsibilities. The Compensation and Benefits Committee considers management’s views relating to compensation matters, including the performance metrics and targets for BD’s performance-based compensation. Management also provides information (which is reviewed by our Internal Audit Department) to assist the Committee in determining the extent to which performance targets have been achieved. This includes any recommended adjustments to BD’s operating results when assessing BD’s performance. The Chief Executive Officer and Senior Vice President—Human Resources also work with the Compensation and Benefits Committee chair in establishing meeting agendas.

The Compensation and Benefits Committee meets in executive session with no members of management present for part of each of its regular meetings. The Compensation and Benefits Committee also meets in executive session when considering compensation decisions regarding our executive officers.

Role of the Independent Consultant

The Compensation and Benefits Committee is also assisted in fulfilling its responsibilities by its independent consultant, Pay Governance LLC (“Pay Governance”). Pay Governance is engaged by, and reports directly to, the Compensation and Benefits Committee. Pay Governance reviews all materials prepared for the Compensation and Benefits Committee by management, prepares additional materials as may be requested by the Compensation and Benefits Committee, and attends Compensation and Benefits Committee meetings. In its

advisory role, among other things, Pay Governance assists the Compensation and Benefits Committee in the design and implementation of BD’s compensation program. This includes assisting the Compensation and Benefits Committee in selecting the key elements to include in the program, the targeted payments for each element, and the establishment of performance targets. Pay Governance also provides market comparison data, which is one of the factors considered by the Compensation and Benefits Committee in making compensation decisions, and makes recommendations to the Compensation and Benefits Committee regarding the compensation of BD’s Chief Executive Officer. Pay Governance also provided market comparison data in connection with compensation decisions relating to the transition of the Chief Executive Officer role from Mr. Ludwig to Mr. Forlenza.

Pay Governance also conducts an annual review of the compensation practices of select peer companies. Based on this review, Pay Governance advises the Compensation and Benefits Committee with respect to the competitiveness of BD’s compensation program in comparison to industry practices, and identifies any trends in executive compensation. During fiscal year 2011, Pay Governance was not engaged to perform any services for BD’s management. The Compensation and Benefits Committee has adopted a policy prohibiting Pay Governance from providing any services to BD’s management without the Compensation and Benefits Committee’s prior approval, and has expressed its intention that such approval will be given only in exceptional cases.

Setting Compensation

At the end of each fiscal year, the Board conducts a review of the Chief Executive Officer’s performance. At the following Board meeting, the Board sets the compensation of the Chief Executive Officer after considering the review of the Chief Executive Officer’s performance, market comparison data and the recommendations of the Compensation and Benefits Committee. Neither the Chief Executive Officer nor any other members of management are present during this session. The Chief Executive Officer does not play a role in determining his own compensation.

The Compensation and Benefits Committee is responsible for determining the compensation of BD’s other executive officers. The Chief Executive Officer, in consultation with the Senior Vice President—Human Resources, reviews the performance of the other executive officers with the Compensation and Benefits Committee and makes compensation recommendations for its consideration. The Compensation and Benefits Committee determines the compensation for these executives, in consultation with Pay Governance, after considering the Chief Executive Officer’s recommendations, market comparison data regarding compensation levels among peer companies and the views of Pay Governance. All decisions regarding the compensation of BD’s other executive officers are made in executive session.

The Board has delegated responsibility for formulating recommendations regarding non-management director compensation to the Corporate Governance and Nominating Committee, which is discussed below.

SCIENCE, INNOVATION AND TECHNOLOGY COMMITTEE

Function

•

Oversees BD’s research and development activities.

•

Oversees BD’s policies, practices and procedures relating to regulatory compliance and product quality and safety.

Members

Alfred Sommer—Chair

Henry P. Becton, Jr.

Claire M. Fraser-Liggett

Christopher Jones

Adel A.F. Mahmoud

Gary A. Mecklenburg

Cathy E. Minehan

CORPORATE GOVERNANCE AND NOMINATING COMMITTEE

Function

•

Identifies and recommends candidates for election to the Board.

•

Reviews the composition, structure and function of the Board and its Committees, as well as the performance and compensation of non-management directors.

•

Monitors BD’s corporate governance and Board practices, and oversees the Board’s self-evaluation process.

•

Oversees BD’s policies, practices and procedures impacting BD’s image and reputation and its standing as a responsible corporate citizen, including, without limitation, issues relating to communications with BD’s key stakeholders, community relations, and public policy and government relations activities.

Members

Henry P. Becton, Jr.—Chair

Edward F. DeGraan

Claire M. Fraser-Liggett

Adel A.F. Mahmoud

Willard J. Overlock, Jr.

Alfred Sommer

The Board has determined that each member of the Corporate Governance and Nominating Committee meets the independence requirements of the NYSE. As stated above, the Corporate Governance and Nominating Committee reviews the compensation program for the non-management directors and makes recommendations to the Board regarding their compensation, and may not delegate these responsibilities to another Committee, individual director or member of management. The Corporate Governance and Nominating Committee has retained Pay Governance as an independent consultant for this purpose. Pay Governance’s responsibilities include providing market comparison data on non-management director compensation at peer companies; tracking trends in non-management director compensation practices; and advising the Corporate Governance and Nominating Committee regarding the components and levels of non-management director compensation. Executive officers do not play any role in either determining or recommending non-management director compensation.

Board, Committee and Annual Meeting Attendance

The Board and its Committees held the following number of meetings during fiscal year 2011:


Board			6
Audit Committee			11
Compensation and Benefits Committee			7
Corporate Governance and Nominating Committee			5
Science, Innovation and Technology Committee			5

The Executive Committee did not meet during fiscal year 2011.

Each director attended 75% or more of the total number of the meetings of the Board and the Committees on which he or she served during fiscal year 2011. BD’s non-management directors met in executive session at each of the Board’s meetings held during fiscal year 2011.

The Board has adopted a policy pursuant to which directors are expected to attend the Annual Meeting of Shareholders in the absence of a scheduling conflict or other valid reason. Due to severe weather conditions, only one of the directors then in office was able to attend BD’s 2011 Annual Meeting.

Non-Management Directors’ Compensation

The Board believes that providing competitive compensation is necessary to attract and retain qualified non-management directors. The key elements of BD’s non-management director compensation are a cash retainer, equity compensation, Committee chair fees and a Lead Director fee. Of the base compensation paid to the non-management directors (not including Committee chair fees), approximately two-thirds currently is equity compensation that directors are required to retain until they complete their service on the Board. See “Corporate Governance—Significant Governance Practices—Equity Ownership by Directors” on page 22. This retention feature serves to better align the interests of the directors and BD shareholders and ensure compliance with the director share ownership guidelines. Messrs. Ludwig and Forlenza do not receive compensation related to their service as directors.

Cash Retainer

Each non-management director currently receives an annual cash retainer of $75,000 for services as a director. Directors do not receive meeting attendance fees.

Equity Compensation

Each non-management director elected at an Annual Meeting of Shareholders is granted restricted stock units then valued at $150,000 (using the same methodology used to value awards made to executive officers). Directors newly elected by the Board receive a grant pro-rated from the effective date of their election to the next Annual Meeting. The shares of BD common stock underlying the restricted stock units are not issuable until a director’s separation from the Board.

Committee Chair/Lead Director Fees

An annual fee of $10,000 is paid to each Committee chair, except that the fee for the Audit Committee chair is $15,000 in recognition of the Audit Committee’s responsibilities. No fee is paid to the Chair of the Executive Committee. An annual fee of $25,000 is paid to the Lead Director.

Other Arrangements

BD reimburses non-management directors for travel and other business expenses incurred in the performance of their services for BD. Directors may travel on BD aircraft in connection with such activities, and, on limited occasions, spouses of directors have joined them on such flights. No compensation is attributed to the director for these flights in the table below, since the aggregate incremental costs of spouse travel are minimal. In the event directors utilize other private aircraft, they are reimbursed for the incremental cost thereof. Directors are also reimbursed for attending director education courses. BD occasionally invites spouses of directors to Board-related business events, for which they are reimbursed their travel expenses.

Directors are eligible, on the same basis as BD associates, to participate in BD’s Matching Gift Program, pursuant to which BD matches contributions made to qualifying nonprofit organizations. The aggregate annual limit per participant is $5,000.

The following table sets forth the compensation received by the non-management directors during fiscal year 2011.

Fiscal Year 2011 Non-Management Directors’ Compensation


Name	Fees Earned or Paid in Cash		Stock Awards(1)		Change in Pension Value and Nonqualified Deferred Compensation Earnings(2)		All Other Compensation(3)		Total
Basil L. Anderson	$	90,000	$	150,708		—		—	$	240,708
Henry P. Becton, Jr.		110,000		150,708	$	32		—		260,740
Edward F. DeGraan		85,000		150,708		—		—		235,708
Claire M. Fraser-Liggett		75,000		150,708		—		—		225,708
Christopher Jones		75,000		150,708		—		—		225,708
Marshall O. Larsen		75,000		150,708		33		—		225,741
Adel A.F. Mahmoud		75,000		150,708		—		—		225,708
Gary A. Mecklenburg		75,000		150,708		—		—		225,708
Cathy E. Minehan		75,000		150,708		—	$	5,000		230,708
James F. Orr		75,000		150,708		—		—		225,708
Willard J. Overlock, Jr.		75,000		150,708		—	$	5,000		230,708
Bertram L. Scott		75,000		150,708		27		—		225,735
Alfred Sommer		85,000		150,708		—	$	2,000		237,708

(1)

The amounts shown in the “Stock Awards” column reflect the grant date fair value under FASB ASC Topic 718 of restricted stock units awarded to non-management directors during the fiscal year. The amounts shown are slightly different than the $150,000 target value, since a moving average of BD’s stock price is used to value the units granted rather than the grant date price. For a discussion of the assumptions made by us in arriving at the grant date fair value of these awards, see Note 7 to the consolidated financial statements that are included in our Annual Report on Form 10-K for the fiscal year ended September 30, 2011.

Listed below are the aggregate outstanding restricted stock unit awards and option awards held by each non-management director at the end of fiscal year 2011. Stock options have not been issued to non-management directors since the 2005 Annual Meeting.


Name	Stock Awards Outstanding at September 30, 2011		Option Awards Outstanding at September 30, 2011
Basil L. Anderson		12,741		2,160
Henry P. Becton, Jr.		14,096		9,544
Edward F. DeGraan		14,096		4,436
Claire M. Fraser-Liggett		9,347		0
Christopher Jones		2,996		0
Marshall O. Larsen		7,652		0
Adel A.F. Mahmoud		9,347		0
Gary A. Mecklenburg		12,741		2,160
Cathy E. Minehan		7,652		0
James F. Orr		14,096		4,436
Willard J. Overlock, Jr.		14,096		9,544
Bertram L. Scott		14,096		7,217
Alfred Sommer		14,096		4,436

(2)	Represents interest on deferred directors’ fees in excess of 120% of the federal long-term rate.

(3)	Amounts shown represent matching gifts under BD’s Matching Gift Program, which is more fully discussed on the previous page.

Changes to Non-Management Directors’ Compensation

During fiscal year 2011, the Board undertook a review of the compensation of its non-management directors. This review included an analysis of the director compensation practices of certain peer companies, including the forms of equity compensation used, the mix of cash and equity compensation, and total compensation.

The peer group included the following companies: Agilent Technologies, Inc.; Allergan, Inc.; C.R. Bard, Inc.; Baxter International Inc.; Beckman Coulter, Inc.; Boston Scientific Corporation; Covidien plc; Hospira, Inc.; Medtronic, Inc.; PerkinElmer, Inc.; St. Jude Medical, Inc.; Stryker Corporation; Thermo Fisher Scientific Inc.; and Zimmer Holdings, Inc.

As a result of its review, the Board approved the following changes to the compensation of BD’s non-management directors, effective at the conclusion of the 2012 Annual Meeting, so as to better align its compensation with the non-management director compensation being paid by the peer group companies.

•

The annual cash retainer will be increased by $6,000 to $81,000.

•

The value of the annual grant of restricted stock units will be increased by $12,000 to $162,000.

Directors’ Deferral Plan

Directors may defer receipt of all or part of their annual cash retainer and other cash fees pursuant to the provisions of the 1996 Directors’ Deferral Plan. Directors may also defer receipt of shares issuable to them under their restricted stock units upon leaving the Board. A general description of the 1996 Directors’ Deferral Plan appears on page 6.

Communication with Directors

Shareholders or other interested parties wishing to communicate with the Board, the non-management directors or any individual director (including complaints or concerns regarding accounting, internal accounting controls or audit matters) may do so by contacting the Lead Director either:

•

by mail, addressed to BD Lead Director, P.O. Box 264, Franklin Lakes, New Jersey 07417-0264;

•

by calling the BD Ethics Help Line, an independent toll-free service, at 1-800-821-5452 (callers from outside North America should use “AT&T Direct” to reach AT&T in the U.S. and then dial the above toll-free number); or

•

by email to ethics_office@bd.com.

All communications will be kept confidential and promptly forwarded to the Lead Director, who shall, in turn, forward them promptly to the appropriate director(s). Such items that are unrelated to a director’s duties and responsibilities as a Board member may be excluded by our corporate security department, including, without limitation, solicitations and advertisements, junk mail, product-related communications, job referral materials and resumes, surveys, and material that is determined to be illegal or otherwise inappropriate.

CORPORATE GOVERNANCE

Corporate Governance Principles

BD’s commitment to good corporate governance is embodied in our Corporate Governance Principles (the “Principles”). The Principles set forth the Board’s views and practices regarding a number of governance topics, and the Corporate Governance and Nominating Committee assesses the Principles on an ongoing basis in light of current practices. The Principles cover a wide range of topics, including voting for directors; board leadership structure; the selection of director nominees; director independence; annual self-evaluations of the Board and its Committees; conflicts of interest; and charitable contributions to entities with which BD’s executive officers and directors are affiliated, each of which is discussed below, along with other significant governance practices. The Principles are available on BD’s website at www.bd.com/investors/corporate_governance/. Printed copies of the Principles may be obtained, without charge, by contacting the Corporate Secretary, BD, 1 Becton Drive, Franklin Lakes, New Jersey 07417-1880, phone 1-201-847-6800.

Board Leadership Structure

The Board’s goal is to achieve the best board leadership structure for effective oversight of BD’s management. The Board believes that there is no single, generally accepted approach to providing Board leadership, and that each of the possible leadership structures for a board must be considered in the context of the individuals involved and the specific circumstances facing a company. Accordingly, the right board leadership structure may vary as circumstances warrant.

In connection with Vincent A. Forlenza succeeding Edward J. Ludwig as BD’s Chief Executive Officer, the Board determined that Mr. Ludwig should continue to serve as the Chairman of the Board during the transition of the CEO role to Mr. Forlenza. The Board believes that this structure is the best for BD at this time, since it allows Mr. Forlenza, as a new CEO, to dedicate himself to operational matters during this transition phase, while allowing Mr. Ludwig to focus on Board-related matters. In addition, the role of Lead Director, currently being served by Henry P. Becton, Jr., allows the non-management directors to provide independent Board leadership and oversight of management.

The Principles provide for the appointment of a Lead Director from among the independent directors whenever the Chairman is not independent. The responsibilities of the Lead Director include:

•

Presiding over executive sessions of the non-management directors and over Board meetings in the absence of the Chairman;

•

Consulting on and approving Board agendas and meeting schedules;

•

Ensuring the adequacy of the flow of information to the non-management directors;

•

Together with the Chair of the Compensation and Benefits Committee, coordinating the evaluation of the Chief Executive Officer by the non-management directors;

•

Acting as a liaison between the non-management directors and the Chief Executive Officer; and

•

Serving as a contact person to facilitate communications between BD’s associates, shareholders and other constituents and the non-management directors.

Board’s Oversight of Risk

BD’s management engages in a process referred to as enterprise risk management (“ERM”) to identify, assess, manage and mitigate a broad range of risks across BD’s businesses, regions and functions and to ensure alignment of our risk assessment and mitigation efforts with BD’s corporate strategy. The Audit Committee, through the authority delegated to it by the Board of Directors, is primarily responsible for overseeing BD’s ERM activities to determine whether the process is functioning effectively and is consistent with BD’s business

strategy. At least twice a year, senior management reviews the results of its ERM activities with the Audit Committee, including the process used within the organization to identify risks, management’s assessment of the significant categories of risk faced by BD (including any changes in such assessment since the last review), and management’s plans to mitigate the potential exposures. On at least an annual basis, the significant risks identified through BD’s ERM activities and the related mitigation plans are reviewed with the full Board. Often, particular risks are reviewed in-depth with the Audit Committee or the full Board at subsequent meetings.

In addition, the full Board reviews the risks associated with BD’s strategic plan and discusses the appropriate levels of risk in light of BD’s objectives. This is done through an annual strategic planning process, periodically throughout the year as part of its ongoing review of corporate strategy, and otherwise as necessary. The full Board also regularly oversees other areas of potential risk, including BD’s capital structure, acquisitions and divestitures, and succession planning for BD’s Chief Executive Officer and other members of senior management.

The various Committees of BD’s Board are also responsible for monitoring and reporting on risks associated with their respective areas of oversight. The Audit Committee oversees BD’s accounting and financial reporting processes and the integrity of BD’s financial statements, BD’s processes to ensure compliance with laws, its hedging activities and insurance coverages. The Compensation and Benefits Committee oversees risks associated with BD’s compensation practices and programs, and the Corporate Governance and Nominating Committee oversees risks relating to BD’s corporate governance practices, including director independence, related person transactions and conflicts of interest. In connection with its oversight responsibilities, each Committee often meets with members of management who are primarily responsible for the management of risk in their respective areas, including BD’s Chief Financial Officer, Senior Vice President–Human Resources, General Counsel, Senior Vice President–Regulatory Affairs, Chief Ethics and Compliance Officer and other members of senior management.

Risk Assessment of Compensation Programs

With respect to our compensation policies and practices, BD’s management reviewed our policies and practices to determine whether they create risks that are reasonably likely to have a material adverse effect on BD. In connection with this risk assessment, we reviewed the design of BD’s compensation and benefits programs (in particular our performance-based compensation programs) and related policies, potential risks that could be created by the programs, and features of our programs and corporate governance generally that help to mitigate risk. Among the factors we considered were the mix of cash and equity compensation, and of fixed and variable compensation, paid to our associates, the balance between short- and long-term objectives of our incentive compensation, the performance metrics, performance targets, vesting periods, threshold performance requirements and funding formulas related to our incentive compensation, the degree to which programs are formulaic or provide discretion to determine payout amounts, caps on payouts, our clawback and share ownership policies, and our general governance structure. Management reviewed and discussed the results of this assessment with the Compensation and Benefits Committee. Based on this review, we believe that our compensation policies and practices do not create risks that are reasonably likely to have a material adverse effect on the BD.

Director Nomination Process

The Corporate Governance and Nominating Committee reviews potential director candidates and recommends nominees for director to the full Board for approval. In making its recommendations, the Committee assesses the overall composition of the Board, including diversity, age, skills, international background, and experience and prominence in areas of importance to BD. The Board seeks to achieve among directors a diversity of viewpoint, experience, knowledge, ethnicity and gender that fits the needs of the Board at that particular time.

When considering individual director candidates, the Corporate Governance and Nominating Committee will seek individuals with backgrounds and qualities that, when combined with those of BD’s other directors, provide a blend of skills and experience that will further enhance the Board’s effectiveness. From time-to-time, the Corporate Governance and Nominating Committee has retained an executive search firm to assist it in its efforts to identify and evaluate potential director candidates.

The Corporate Governance and Nominating Committee believes that any nominee for director must meet the following minimum qualifications:

•

Candidates should be persons of high integrity who possess independence, forthrightness, inquisitiveness, good judgment and strong analytical skills.

•

Candidates should demonstrate a commitment to devote the time required for Board duties, including, but not limited to, attendance at meetings.

•

Candidates should be team-oriented and be committed to the interests of all shareholders as opposed to those of any particular constituency.

The Corporate Governance and Nominating Committee assesses the characteristics and performance of incumbent director nominees against the above criteria as well, and, to the extent applicable, considers the impact of any change in the principal occupations of such directors during the last year. Upon completion of the individual director evaluation process, the Corporate Governance and Nominating Committee reports its conclusions and recommendations for nominations to the full Board.

It is the Corporate Governance and Nominating Committee’s policy to consider referrals of prospective nominees for the Board from other Board members and management, as well as shareholders and other external sources, such as retained executive search firms. The Corporate Governance and Nominating Committee utilizes the same criteria for evaluating candidates irrespective of their source.

To recommend a candidate for consideration, a shareholder should submit a written statement of the qualifications of the proposed nominee, including full name and address, to the Corporate Secretary, BD, 1 Becton Drive, Franklin Lakes, New Jersey 07417-1880.

Significant Governance Practices

Described below are some of the significant corporate governance practices that have been instituted by the BD Board.

Annual Election of Directors

In 2009, in response to changing shareholder views and evolving corporate governance practices, BD’s Restated Certificate of Incorporation was amended to provide for the annual election of directors. The Board believes that annual elections of directors reflect a corporate governance best practice, as it provides shareholders the opportunity to express their views on the performance of the entire Board each year.

Voting for Directors

Under our By-Laws, in uncontested elections (where the number of nominees does not exceed the number of directors to be elected), nominees for director must receive the affirmative vote of a majority of the votes cast in order to be elected to the Board of Directors. Any incumbent director who fails to receive the requisite affirmative vote is required to offer to submit his or her resignation to the Board following the shareholder vote. The Corporate Governance and Nominating Committee will consider and recommend to the Board whether to accept the resignation offer. The Board will act on such recommendation and publicly disclose its decision within 90 days following the shareholder vote. This structure allows the Board the opportunity to identify and assess the reasons for the vote, including whether the vote is attributable to dissatisfaction with a director’s overall performance or is the result of shareholder views on a particular issue, and enables it to avoid undesirable and disruptive governance consequences.

Board Self-Evaluation

Each year the Board conducts a self-evaluation of its performance and effectiveness. As part of this process, each director completes an evaluation form on specific aspects of the Board’s role, organization and meetings. The collective comments are then presented by the Chair of the Corporate Governance and Nominating Committee to the full Board. As part of the evaluation, the Board assesses the progress in the areas targeted for improvement a year earlier, and develops actions to be taken to enhance the Board’s effectiveness over the next year. The Board’s evaluation covers many areas (a complete list is available on BD’s website at www.bd.com/investors/corporate_governance). Additionally, each Board Committee conducts an annual self-evaluation of its performance through a similar process.

Equity Ownership by Directors

The Board believes that directors should hold meaningful equity ownership positions in BD. To that end, a significant portion of non-management director compensation is in the form of restricted stock units that are not distributable until a director completes his or her service on the Board. The Board believes these equity interests help to better align the interests of the non-management directors with shareholders. Under the Board’s share ownership guidelines, each non-management director is required to own shares of common stock (which includes restricted stock units) valued at 50% of the amount obtained by multiplying the annual cash retainer by the number of years the director has served. Each non-management director currently owns sufficient shares to comply with these guidelines. Effective following the 2012 Annual Meeting, the ownership guidelines will be amended to require each non-management director to own stock equal in value to five times the annual retainer.

Annual Report of Charitable Contributions

In furtherance of BD’s commitment to good governance and disclosure practices, the Principles require that BD’s charitable contributions or pledges in an aggregate amount of $50,000 or more (not including contributions under BD’s Matching Gift Program) to entities with which BD’s directors and executive officers, and their families, are affiliated must be approved by the Corporate Governance and Nominating Committee. In addition, BD is required by the Principles to post on its website, at www.bd.com/investors/corporate_governance/, an Annual Report of Charitable Contributions (the “Contributions Report”) listing all such contributions and pledges made by BD during the preceding fiscal year in an amount of $10,000 or more. The Contributions Report, which BD has voluntarily issued since 2002, includes a discussion of BD’s contributions philosophy and the alignment of BD’s philanthropic activities with its philosophy, together with additional information about each contribution or pledge.

Enterprise Compliance

Under the oversight of the Audit Committee, BD’s enterprise compliance function is aimed at ensuring that BD has policies and procedures designed to prevent and detect violations of the many laws, regulations and policies affecting its business, and that BD continuously encourages lawful and ethical conduct. Launched in 2005, BD’s enterprise compliance function supplements the various compliance and ethics functions that were already in place at BD, and seeks to ensure better coordination and effectiveness through program design, prevention, and promotion of an organizational culture of compliance. A Compliance Committee comprised of members of senior management oversees the activities of the Chief Ethics and Compliance Officer. Another key element of this program is training. Courses offered include a global on-line compliance training program focused on BD’s Code of Conduct, as well as other courses covering various compliance topics such as antitrust, anti-bribery, conflicts of interest, financial integrity, industry marketing codes and information security.

Director Independence; Policy Regarding Related Person Transactions

Under the NYSE rules and our Principles, a director is deemed not to be independent if the director has a direct or indirect material relationship with BD (other than his or her relationship as a director). The Corporate Governance and Nominating Committee annually reviews the independence of all directors and reports its

findings to the full Board. To assist in this review, the Board has adopted director independence guidelines (“Independence Guidelines”) that are contained in the Principles. The Independence Guidelines set forth certain categories of relationships (and related dollar thresholds) between BD and directors and their immediate family members, or entities with which they are affiliated, that the Board, in its judgment, has deemed to be either material or immaterial for purposes of assessing a director’s independence. In the event a director has any relationship with BD that is not addressed in the Independence Guidelines, the independent members of the Board review the facts and circumstances to determine whether such relationship is material.

The Board has determined that the following directors are independent under the Independence Guidelines: Basil L. Anderson, Henry P. Becton, Jr., Edward F. DeGraan, Claire M. Fraser-Liggett, Christopher Jones, Marshall O. Larsen, Adel A.F. Mahmoud, Gary A. Mecklenburg, Cathy E. Minehan, James F. Orr, Willard J. Overlock, Jr., Bertram L. Scott and Alfred Sommer. Edward J. Ludwig and Vincent A. Forlenza are employees of BD and, therefore, are not independent under the NYSE rules and the Principles.

In determining that each of the non-management directors is independent, the Board reviewed BD’s transactions or other dealings with organizations with which a director may be affiliated. Such affiliations included service by the director or an immediate family member as an officer, employee, or member of a governing or advisory board. In conducting its review, the Board determined that, in each instance, the nature of the relationship, the degree of the director’s involvement with the organization and the amount involved would not impair the director’s independence under the Independence Guidelines. In addition, in most instances, the director played no active role in the organization’s relationship with BD, and, in some instances, the relationship involved a unit of such organization other than the one with which the director is involved. Accordingly, the Board determined that none of these relationships was material or conflicted with BD’s interests, or impaired the relevant director’s independence or judgment.

The types of transactions with director-affiliated organizations considered by the Board consisted of payments related to the purchase or sale of products and/or services (in the cases of Anderson, Becton, Fraser-Liggett, Jones, Larsen, Mecklenburg, Minehan, Orr, Overlock, Scott, and Sommer), the licensing of intellectual property rights (in the cases of Fraser-Liggett, Mahmoud and Sommer) and charitable contributions (in the cases of Jones, Overlock and Sommer). With respect to Mr. Scott, these included transactions between BD and CIGNA Corporation, pursuant to a relationship that pre-dated Mr. Scott becoming an executive officer of CIGNA. CIGNA is one of BD’s medical claims administrators under BD’s self-insured medical plan, which involves the administration and processing of medical claims for BD associates. BD pays CIGNA an administrative fee for the use of CIGNA’s networks, claims processing and customer service inquiries. CIGNA also acts as the insurer for BD’s Basic and Voluntary Accident Programs and Business Travel Accident insurance program for BD associates, for which BD pays to CIGNA the premiums for BD associates’ basic insurance coverage. BD paid approximately $381,000 for these services in fiscal year 2011. With respect to Ms. Minehan, the Board reviewed transactions with Goldman Sachs, of which Ms. Minehan’s husband is a Managing Director. Goldman Sachs provided investment banking and certain financial services to BD during the year, for which BD paid approximately $5 million. In both cases, the amounts paid were well below the dollar thresholds set under the Principles to determine that a business relationship is material. Accordingly, the Board concluded that these were not material relationships that would impede the exercise of independent judgment by Ms. Minehan or Mr. Scott.

The Board has also established a written policy (the “Policy”) requiring Board approval or ratification of transactions involving more than $120,000 per year in which a director, executive officer or shareholder owning more than 5% of BD’s stock (excluding certain passive investors) or their immediate family members has, or will have, a material interest. The Policy is available on BD’s website at www.bd.com/investors/corporate_governance/. The Policy excludes certain specified transactions, including certain charitable contributions, transactions available to associates generally, and indemnification and advancement of certain expenses. The Corporate Governance and Nominating Committee is responsible for the review and approval or ratification of transactions subject to the Policy. The Corporate Governance and Nominating Committee will

approve or ratify only those transactions that it determines in its business judgment are fair and reasonable to BD and in (or not inconsistent with) the best interests of BD and its stockholders, and that do not impact the director’s independence.

During fiscal year 2011, BD paid State Street Bank and Trust Company (“State Street”) (and its affiliated operating units), a holder of more than 5% of BD common stock, $763,500 for banking services and investment management of various 401(k) funds. These transactions are not required to be approved under the Policy, since State Street is considered a passive investor in BD.

Code of Conduct

BD maintains a Code of Conduct (the “Code”) that is applicable to all directors, officers and associates of BD, including its Chief Executive Officer and its Chief Financial Officer, principal accounting officer and other senior financial officers. It sets forth BD’s policies and expectations on a number of topics, including conflicts of interest, confidentiality, compliance with laws (including insider trading laws), preservation and use of BD’s assets, and business ethics. The Code also sets forth procedures for the communicating and handling of any potential conflict of interest (or the appearance of any conflict of interest) involving directors or executive officers, and for the confidential communication and handling of issues regarding accounting, internal controls and auditing matters.

BD also maintains an Ethics Help Line telephone number (the “Help Line”) for BD associates as a means of raising concerns or seeking advice. The Help Line is serviced by an independent contractor and is available to all associates worldwide. Associates using the Help Line may choose to remain anonymous and all inquiries are kept confidential to the extent practicable in connection with investigation of an inquiry. All Help Line inquiries are forwarded to BD’s Chief Ethics and Compliance Officer for investigation. The Audit Committee is informed of any matters reported to the Chief Ethics and Compliance Officer, whether through the Help Line or otherwise, involving accounting, internal control or audit matters, or any fraud involving management or persons who have a significant role in BD’s internal controls.

The Chief Ethics and Compliance Officer leads the BD Ethics Office, which administers BD’s ethics program. In addition to the Help Line, the ethics program provides for broad communication of BD’s Core Values, associate education regarding the Code and its requirements, and ethics training sessions.

Any waivers from any provisions of the Code for executive officers and directors will be promptly disclosed to shareholders. In addition, certain amendments to the Code, as well as any waivers from certain provisions of the Code relating to BD’s Chief Executive Officer, Chief Financial Officer or principal accounting officer, will be posted at the website address set forth below.

The Code is available on BD’s website at www.bd.com/investors/corporate_governance/. Printed copies of the Code may be obtained, without charge, by contacting the Corporate Secretary, BD, 1 Becton Drive, Franklin Lakes, New Jersey 07417-1880, phone 1-201-847-6800.

REPORT OF THE COMPENSATION AND BENEFITS COMMITTEE

The primary objective of the BD compensation program is to fully support the strategic business goal of delivering superior long-term shareholder returns through sustained revenue growth, EPS growth and return on capital. As such, we intend to ensure a high degree of alignment between pay and the long-term value and financial soundness of BD. The Compensation and Benefits Committee of the Board of Directors (the “Committee”) has established the following compensation principles to meet this objective:

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Aligning the interests of executives and shareholders

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Through equity compensation and equity ownership guidelines for executives, we seek to align the interests of executives with those of the company’s shareholders. This represents the largest portion of our compensation structure.

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Linking rewards to performance

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We maintain a pay-for-performance philosophy based on actual performance as against clear, measurable company performance targets, particularly those metrics which support the creation of long-term shareholder value.

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Delivering superior business and financial results

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Performance targets are set to reward executives for achieving outstanding short- and long-term results in line with our objective of enhancing long-term shareholder value. In setting short-term goals and in rewarding performance, we will take care to ensure that we do not create incentives to take inappropriate risks.

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Offering a competitive compensation structure

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We have established and intend to maintain a competitive structure that supports the recruitment and retention of high-performance executives essential to driving the business results required to execute our strategy and create long-term value for shareholders. This structure is determined by evaluating peer group data which is provided and analyzed by the Committee’s independent consultant, Pay Governance LLC.

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Maintaining a transparent compensation structure

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The Committee strives to provide absolute transparency to executives, employees and shareholders of all aspects of BD’s compensation and benefits structure. This includes disclosure of performance targets, payout formulas and details of other earned benefits.

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Maintaining Committee independence

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The Committee is made up exclusively of independent directors and utilizes an independent compensation consultant, Pay Governance LLC, which, by Committee policy, is prohibited from performing any services for BD or its management without the Committee’s prior approval.

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Retaining prerogative to adjust programs

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The Committee retains the prerogative to change or modify compensation and benefit programs to reflect prevailing economic, market or company financial conditions.

The Committee has reviewed and discussed the Compensation Discussion and Analysis with management, and, based on such review and discussions, has recommended to the Board of Directors that the Compensation Discussion and Analysis be included in BD’s Annual Report on Form 10-K for the year ended September 30, 2011 and in this proxy statement.

COMPENSATION AND BENEFITS COMMITTEE

Edward F. DeGraan—Chair

Basil L. Anderson

Marshall O. Larsen

James F. Orr

Willard J. Overlock, Jr.

Bertram L. Scott

COMPENSATION DISCUSSION AND ANALYSIS

This section discusses our executive compensation program and the compensation actions taken with respect to the executive officers named in the Summary Compensation Table on page 41. We sometimes refer to these individuals as the “named executive officers” or “NEOs.” All references in this section to years are references to our fiscal year, which ends on September 30, unless otherwise noted.

This section includes a discussion of performance targets in the limited context of our executive compensation program. These targets are not statements of management’s expectations of our future results or other guidance. Investors should not use or evaluate these targets in any other context or for any other purpose.

Executive Summary

Overview of our compensation program

Our goal is to provide an executive compensation program that best serves the long-term interests of our shareholders. We believe that attracting and retaining superior talent is a key to delivering superior shareholder returns, and that a competitive compensation plan is critical to that end. Therefore, we intend to provide a competitive compensation package to our executives, tie a significant portion of pay to performance and utilize components that best align the interests of our executives with those of BD’s shareholders.

The following is a summary of important aspects of our executive compensation program discussed later in this section.

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The key elements of our program are salary, annual cash incentives under our Performance Incentive Plan (“PIP”) and long-term equity compensation consisting of stock-settled stock appreciation rights (“SARs”) and Performance Units.

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We emphasize pay-for-performance to align executive compensation with our business strategy and the creation of long-term shareholder value.

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While we emphasize “at risk” pay tied to performance, we believe our program does not encourage excessive risk taking by management.

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Our executives are subject to share ownership guidelines and are prohibited from hedging against the economic risk of such ownership.

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We offer our executives very limited perquisites, and none of them have employment agreements.

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We have a compensation recovery policy that gives the Board discretion to recover incentive compensation paid to senior management in the event of a restatement of our financial statements due to misconduct.

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We have “double-trigger” change of control agreements with our executives to provide continuity of management in the event of a change of control of BD.

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The independent consultant to the Compensation and Benefits Committee (the “Compensation Committee”) did not provide any other services to BD in 2011.

Overview of 2011 operating performance and executive compensation

BD delivered solid results in 2011, with all three segments contributing to our growth. During the year, BD experienced strong growth in safety sales and in emerging markets. Similar to recent years, however, BD and the

medical device industry continued to face a challenging business environment. Various macroeconomic conditions adversely affected our underlying growth and profitability during the year. We continued to see downward pressure on healthcare utilization in Western Europe and in the U.S., which led to weakened overall customer demand and increased pricing pressure for certain products in our Medical segment. In addition, BD faced rising raw material costs, in particular resins, throughout the year.

Despite these ongoing challenges, BD’s management delivered solid results for the year. Highlights of our performance include:

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Reported revenues grew about 6%, which included an approximate 3% benefit from currency translation. Our revenue growth rate was negatively affected by about 2% due to certain sales relating to pandemic flu and governmental stimulus and supplemental spending in 2010 that did not repeat in 2011.

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Reported earnings per share from continuing operations grew approximately 14% (including an approximate 6% benefit from currency translation).

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BD used its strong financial condition to take steps to position BD for long-term growth, including increased investments in high-growth areas in emerging markets, and increased research and development spending.

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Significant progress was made on BD’s growth and operating efficiency initiatives.

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BD successfully completed the acquisitions of Accuri Cytometers and Carmel Pharma.

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BD returned more than $1.8 billion to shareholders through dividends and share repurchases. BD has now increased its dividend for 39 consecutive years.

BD’s performance for the year resulted in available funding for annual awards under the PIP at 110% of target. As discussed below, the Compensation Committee, upon management’s recommendation, used its discretion to reduce the available funding for awards to target levels, and, as a result, awards to our named executive officers were generally in-line with their award targets. The year-over-year increase in PIP awards to BD’s Chief Executive Officer and other named executive officers reflects the decision by the Compensation Committee to significantly reduce 2010 PIP awards as part of BD’s cost-cutting measures. In addition, the relatively lower revenue growth BD experienced in 2011 compared to Performance Unit targets contributed to a payout of 20% of target for the Performance Units covering the 2009-2011 performance cycle, continuing a trend over the last three performance cycles of below-target payouts for these awards. Consistent with our past practice, performance-based equity compensation represented a significant component of compensation in 2011. Equity compensation award values for our executives increased compared to 2010, based on performance and adjustments made to align award values with those of peer companies.

Objectives of Our Executive Compensation Program

The objectives of our executive compensation program include:

Offering competitive compensation. We seek to offer a competitive compensation package that helps us attract and retain our executives.

Linking compensation to performance. We seek to implement a pay-for-performance philosophy by tying a significant portion of pay to financial and other goals that support long-term shareholder value.

Aligning executives with our shareholders. We seek to align the interests of our executives with those of our shareholders through equity compensation and share ownership guidelines.

The Process for Setting Executive Compensation

The role of the Compensation Committee, its consultant and management

The Compensation Committee oversees the compensation program for the named executive officers and our other executive officers. The Compensation Committee is assisted in fulfilling its responsibilities by its independent consultant, Pay Governance LLC (“Pay Governance”), and BD’s senior management. Additional information about our process for setting executive compensation, including the role of Pay Governance and management, may be found on pages 13-14. In order to maintain the independence of its outside consultant, the Compensation Committee has established a policy that prohibits its consultant from performing any services for BD’s management without the Compensation Committee’s prior approval. In accordance with this policy, BD did not engage Pay Governance to perform services in 2011.

At last year’s Annual Meeting of Shareholders, approximately 96% of the shares voted were cast in support of BD’s executive compensation and related disclosures for 2010 in connection with the shareholder advisory vote on executive compensation. The Compensation Committee viewed the results of this vote as general broad shareholder support for our executive compensation program. Accordingly, no changes were made to our program as a result of the vote.

The use of market comparison data

The Compensation Committee considers a number of factors in structuring our program and making compensation decisions. This includes the compensation practices of select peer companies in the healthcare industry, which we refer to as the “Comparison Group.” These companies were chosen by the Compensation Committee after considering the recommendations of Pay Governance and management, and were selected because they have significant lines of business that are similar to BD’s. The Compensation Committee believes that reference to the Comparison Group is appropriate when reviewing BD’s compensation program because it believes we compete with these companies for executive talent. The Compensation Committee reviews the composition of the Comparison Group at least annually. The companies in the Comparison Group for 2011 were:

Abbott Laboratories

Agilent Technologies, Inc.

Alcon, Inc.

Allergan, Inc.

C.R. Bard, Inc.

Baxter International Inc.

Beckman Coulter, Inc.

Boston Scientific Corporation

Covidien plc

Hospira, Inc.

Johnson & Johnson

Medtronic, Inc.

PerkinElmer, Inc.

Roche Diagnostics

St. Jude Medical, Inc.

Stryker Corporation

Thermo Fisher Scientific Inc.

Zimmer Holdings, Inc.

Abbott Laboratories, Johnson & Johnson and Roche Diagnostics are included in the Comparison Group in order to increase the number of comparable positions for which compensation data is gathered when reviewing the compensation of Messrs. Forlenza, Kozy and Cohen. Compensation data from these three companies was not considered by the Compensation Committee when reviewing the compensation of Messrs. Ludwig and Elkins.

The Compensation Committee attempts to set the compensation of our executive officers at levels that are competitive with the companies listed above, and uses market comparison data regarding these companies as a guide. The Compensation Committee estimates the median salary, annual cash incentive and long-term equity compensation, and the combined total of these elements, of persons holding the same or similar positions at the companies listed above, based on the most recent market data available. The Compensation Committee then generally seeks to set the compensation of our executive officers for each of these elements within a competitive range of the median, assuming payout of performance-based compensation at target. An executive’s actual compensation may vary from the target amount set by the Compensation Committee based on the individual’s

and BD’s performance and changes in our stock price. The use of market comparison data, however, is just one of the tools the Compensation Committee uses to determine executive compensation, and the Compensation Committee retains the flexibility to set target compensation at levels it deems appropriate for an individual or for a specific element of compensation. The Compensation Committee believes that the target compensation paid to the named executive officers in 2011 was competitive with median levels, except that Mr. Forlenza’s salary and equity compensation was higher in recognition of the duties he had as Chief Operating Officer during the year in addition to his duties as President.

Because the Compensation Committee reviews each compensation element individually, compensation decisions made with respect to one element of compensation generally do not affect decisions made with respect to other elements. It is also for this reason that no specific formula is used to determine the allocation between cash and equity compensation, although it is the Compensation Committee’s intent that equity compensation represent the largest percentage of total target compensation. In addition, because an executive’s compensation target is set by reference to persons with similar duties at the Comparison Group companies, the Compensation Committee does not establish any fixed relationship between the compensation of our Chief Executive Officer (sometimes referred to as the “CEO”) and that of the other named executive officers.

The use of tally sheets

The Compensation Committee is annually provided a “tally sheet” report prepared by management for each named executive officer. The tally sheet includes, among other things, total annual compensation, the value of unexercised or unvested equity compensation awards, and amounts payable upon termination of employment under various circumstances, including retirement or following a change of control. The Compensation Committee uses tally sheets to provide perspective on the wealth the executives have accumulated from prior equity awards and plan accruals and their retentive value, consider any changes to our program that may be appropriate (including the mix of compensation elements), and provide additional context for their compensation decisions.

Our emphasis on pay-for-performance

Performance-based compensation

While we do not use a specific formula to determine the mix of performance-based and fixed compensation, PIP awards and long-term incentive compensation represent a significant portion of the compensation paid to our named executive officers. In 2011, 88% of Mr. Ludwig’s target compensation and an average 80% of the target compensation of the other named executive officers was performance-based and not guaranteed. We view PIP awards and long-term incentive compensation (Performance Units and SARs) as performance-based pay for this purpose.

2011 Total Target Compensation

The above charts are based on the target values of performance-based compensation. Actual amounts received (and the percentage of total compensation coming from performance-based compensation) may differ based on performance and BD’s stock price.

How BD measures performance

The goal of our compensation program is to provide incentives for management to deliver superior near-term and long-term performance. The vehicle for rewarding near-term performance is the PIP. The Compensation Committee evaluates near-term performance under this plan based primarily on BD’s diluted earnings per share from continuing operations (“EPS”) for the year. The Compensation Committee uses EPS because it is the primary basis on which BD sets performance expectations for the year and it is a widely used measure of overall company performance. However, because the Compensation Committee believes sustained revenue growth is necessary to create long-term shareholder value, it also sets a revenue target for the year, although not weighted as heavily as EPS.

The vehicle for rewarding long-term performance is equity compensation, consisting of SARs and Performance Units. The Compensation Committee evaluates long-term performance based on how well BD is executing on its strategy for profitable growth. The Compensation Committee measures this through long-term revenue growth and return on invested capital (which measures profitability and how effectively company assets are being used). These are the two performance metrics BD uses for its Performance Units. These two metrics require the named executive officers to effectively manage a number of different aspects of the business, including new product introductions, productivity improvements, and expansion into geographic markets.

The other way equity compensation is tied to our long-term performance is its linkage to the BD stock price. We believe that sustained performance with respect to revenue growth and return on invested capital should, over time, result in the creation of long-term shareholder value and be reflected in our stock price. If the named executive officers are not successful in creating this shareholder value, this will reduce the value they realize from their equity compensation.

When setting performance targets for the PIP and Performance Units, the Compensation Committee considers the environment in which BD is operating. As discussed before, the global economy generally, and the healthcare industry specifically, is facing very challenging conditions. The Compensation Committee seeks to reward what it deems to be superior performance by management in light of the then current market conditions and growth trends in the market segments BD serves, and what it believes are reasonably achievable performance targets for BD at the time of grant. The Compensation Committee also structures these plans so that payouts are aligned with BD’s performance against these targets. For instance, as discussed further below, a 1% shortfall in performance against a PIP performance measure would result in a 2.5% decrease in funding with respect to that measure. Likewise, a 1% shortfall in performance against the revenue growth target set under the Performance Units we issued in 2011 would reduce the payout of the awards by 12%.

Our risk analysis of performance-based compensation

While a significant portion of executive compensation is performance-based, we do not believe that our program encourages excessive or unnecessary risk-taking. While risk-taking is a necessary part of operating and growing a business, the Compensation Committee focuses on aligning BD’s compensation policies with our long-term strategy and attempts to avoid short-term rewards for management decisions that could pose long-term risks to BD. This includes:

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Limits on PIP awards. We do not overweight short-term incentives as a proportion of total pay. PIP awards are also capped at 200% of an executive’s target award to protect against disproportionately large short-term incentives, and the Compensation Committee has discretion to lower PIP awards based on such factors it deems appropriate, including whether management has taken unnecessary or excessive risk.

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Share Ownership Guidelines. Our share ownership guidelines ensure that our executives have a significant amount of their personal wealth tied to long-term holdings in BD stock.

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Use of Long-Term Equity Compensation. The largest portion of total target compensation is long-term equity compensation that vests over a period of years, which encourages our executives to focus on sustaining BD’s long-term performance.

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Use of Performance Units. About half of each executive’s equity compensation consists of Performance Units that have a three-year performance cycle, which focuses management on sustaining BD’s long-term performance. We also cap the payout of these awards at 200% of target.

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Retention requirement for SARs. The value of SARs is based on BD’s stock price over time. While this could encourage executives to take risks intended to result in short-term increases in our stock price, we mitigate this risk by requiring that all executive officers hold 75% of the net, after-tax shares received upon exercise for one year (even if they are already in compliance with our share ownership guidelines). This risk is further mitigated by including Performance Units as a part of equity compensation and by our share ownership requirements.

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Performance Metrics. We use a variety of performance metrics (earnings per share, revenue growth and return on invested capital) that we believe correlate to long-term shareholder value and that are affected by management decisions.

The Key Elements of Our Compensation Program

The key elements of our executive compensation program are summarized in the table below.


Component	Description		Purpose

Base salary	Fixed cash compensation that is based on performance, scope of responsibilities, experience, and competitive pay practices.		Provide a fixed, baseline level of compensation.

Performance Incentive Plan	Cash payment tied to performance during the fiscal year.		Reward BD’s performance against annual performance objectives and individual contributions to BD’s performance.

Long-term equity compensation:

Ÿ Stock appreciation rights	Right to receive shares equal in value to the difference between exercise price and current BD stock price.	) ) ) ) ) ) ) )	Increase executive ownership, promote executive retention, align compensation with the achievement of long-term performance objectives and reward the creation of shareholder value.
Ÿ Performance Units	Performance-based restricted stock units tied to BD’s performance over three-year performance period.	) ) )

The Compensation Committee believes this combination of cash and equity compensation furthers the objectives of our executive compensation program. Based on prevailing market practices, the Compensation Committee provides a mix of salary, annual cash incentive and equity compensation awards to offer a competitive compensation package. This structure also promotes our pay-for-performance philosophy by linking pay levels to both our near-term performance (through PIP awards) and long-term performance (through equity compensation). A significant portion of compensation is also provided through equity compensation awards, which align the interests of the executives with our shareholders, promote executive retention and reward the creation of shareholder value.

How PIP and Equity Compensation Are Awarded

PIP

The PIP provides our executives an opportunity to receive a cash award for BD’s performance for the fiscal year and their contribution to that performance, as part of our pay-for-performance philosophy.

Target awards. Target PIP awards for the named executive officers are expressed as a percentage of base salary earned during the year. The “Grants of Plan-Based Awards in Fiscal Year 2011” table on page 44 shows the range of possible awards under the PIP.

The factors the Compensation Committee considers when setting PIP awards include BD’s overall performance for the year and the level of available funding (discussed below), as well as the executive’s target award and performance. CEO performance is measured against the performance goals for the year established by the Board. For the other named executive officers, the CEO provides an assessment to the Compensation Committee of how those executive officers performed against the performance objectives set for the businesses or functions they oversee. In each case, the performance objectives for a named executive officer involve a combination of quantitative and qualitative goals. However, no specific formula or weighting of individual performance objectives is used to determine a named executive officer’s PIP award, nor is the achievement of any particular individual performance objective a condition to receiving an award. Instead, the Compensation Committee uses its business judgment to determine the appropriate PIP award to recognize BD’s performance and the executive’s contribution.

Performance Targets. Available funding for PIP awards is determined by a formula tied to how BD performs during the year against the performance targets set by the Compensation Committee. For 2011, these included EPS and revenue targets, with EPS performance weighted 75% and revenue performance weighted 25%. The EPS and revenue targets were based on BD’s business plan for the fiscal year. Revenues for the year are measured after eliminating the estimated effects of foreign currency translation so that only BD’s underlying performance is considered.

As previously discussed, we use EPS as a performance target because it is the primary basis on which we set our performance expectations for the year and EPS is a widely used measure of overall company performance. For this reason, EPS is more heavily weighted than revenue growth. The revenue target was added to increase management’s focus on achieving strong “top-line” growth, consistent with our business strategy. We believe that consistent EPS and revenue growth will result in the creation of long-term shareholder value. We also use these targets because they are clear, measurable and easy for our associates to understand.

Funding for PIP awards is determined by a formula. For both EPS and revenues, the Compensation Committee measures how BD performed against the target goal. For every 1% of performance above target, funding is increased 5%, and for every 1% below target, funding is decreased 2.5%. Performance below 90% of target results in no funding for that particular performance measure. The performance factors for both measures are then weighted, as described above, to arrive at a final funding amount. In the Compensation Committee’s discretion, actual awards, as a percentage of a named executive officer’s target, may be more or less than the overall performance factor.

When comparing BD’s operating results against the performance targets, the Compensation Committee has the discretion to adjust BD’s results to account for acquisitions and divestitures, and items that are not considered part of our ordinary operations. This ensures that management makes decisions based on the best interests of BD, rather than the possible effects on compensation. This discretion is also used to make sure our executives are not unfairly penalized or benefitted by these types of events.

Long-Term Equity Compensation

The equity compensation awards made to the named executive officers in 2011 consisted of SARs and Performance Units. A description of each type of award is on page 45. The Compensation Committee uses this mix of equity vehicles to promote the objectives of our program. SARs are intended to reward the executives for the creation of shareholder value over the term of the award, while Performance Units are intended to reward the named executive officers for sustained long-term performance of the Company, regardless of movements in our stock price.

How equity awards are determined. The Compensation Committee determines the grant date dollar value of the award to be made to each named executive officer, based on market compensation comparison data and individual performance, and awards approximately half of such value in Performance Units and the other half in SARs. Performance Units are valued at grant based on a 20-day moving average stock price, while SARs are valued using an option valuation model that uses certain assumptions, such as stock volatility, dividend yield and the expected life of the SARs. The values given to equity compensation awards by the Compensation Committee are only estimates and are not intended to be predictive of the actual value that will be realized from the awards.

Performance Unit targets. The performance measures used for the Performance Units are average annual revenue growth and average annual return on invested capital (“ROIC”). For the awards made in 2011, revenue growth is weighted 60% and ROIC is weighted 40%. In setting revenue growth and ROIC targets, the Compensation Committee considers BD’s business plan at the time of the grant and what the Compensation Committee believes is a reasonable range of performance over the performance period, as well as economic trends in the segments in which we operate. The Compensation Committee’s goal is to set challenging but achievable targets. As we discussed earlier, we use revenue growth and ROIC as performance metrics because they are directly tied to our long-term growth strategy. As with the PIP, revenue growth is measured after eliminating the estimated effect of foreign currency translation so that only underlying performance is counted. The Compensation Committee believes that sustained performance in revenue growth and ROIC will lead to increased long-term value for our shareholders.

Performance Unit awards are given a share target. The actual number of shares issued is determined by a grid, and can range anywhere from zero (if BD fails to meet the minimum performance threshold for both revenue growth and ROIC) to 200% of the share target (if BD meets or exceeds the maximum performance threshold for both revenue growth and ROIC). In determining payouts, the Compensation Committee has the discretion to adjust BD’s operating results to account for events that occur during the performance period, similar to its discretion under the PIP.

Compensation Actions

Below is a discussion of compensation actions taken with respect to the named executive officers.

Salary adjustments

The base salaries of the named executive officers are reviewed each November, and any adjustments go into effect on January 1 of the following calendar year. The increases in salary for Mr. Elkins and Mr. Forlenza in calendar year 2011 were made to recognize their 2010 performance and make market adjustments based on the compensation paid at the Comparison Group companies.

PIP awards

Our performance for 2011 (adjusted as described below) compared to the performance targets was as follows:


	Target		Performance		Percentage Achieved
EPS (75% weighting)	$	5.50	$	5.66		103%
Currency-neutral revenues (25% weighting)*	$	7,682	$	7,570		99%

Amounts in millions.

The revenue target represented 4.2% growth over 2010, while the EPS target represented 12% growth (11% if 2010 EPS is adjusted for a one-time charge). In reviewing BD’s performance against the performance targets, the Compensation Committee used its discretion to eliminate the effects of our Acurri Cytometers and Carmel Pharma acquisitions during the year. No adjustment was made for the non-cash charge BD reported taking during the year relating to the termination of a research program in our Diagnostics Systems unit.

Under the PIP funding formula, this performance resulted in funding for awards at 110% of target. However, based on management’s recommendation and after considering a number of factors, the Compensation Committee used its discretion to only fund PIP awards at target levels. This is the second year in a row the Compensation Committee set actual funding lower than was available under the PIP formula, which we believe demonstrates BD’s commitment to pay-for-performance and aligning executive compensation with the interests of our shareholders.

The following table shows the PIP awards granted for 2011. These awards are also set forth in the Summary Compensation Table on page 41 under the heading “Non-Equity Incentive Plan Compensation.”


Name	Target Incentive Award		Actual Incentive Award
Edward J. Ludwig	$	1,311,000	$	1,310,308
Vincent A. Forlenza		725,000		723,077
David V. Elkins		460,000		550,000
William A. Kozy		470,800		500,000
Gary M. Cohen		466,800		470,000

The awards to the named executive officers were generally in-line with the target funding approved by the Compensation Committee, and reflect what the Compensation Committee believes was superior performance during the year by BD’s management team. While economic conditions adversely impacted BD’s revenue growth, BD still achieved its earnings goal for the year. Significant progress was also made during the year on BD’s growth initiatives, including launching several new products, achieving milestones for a number of new products in development, and further developing BD’s innovation strategy, including improvements in BD’s portfolio assessment capabilities. In addition, BD continued its successful expansion in emerging markets and continued to deliver strong performance in these markets. Management also met its objectives on BD’s most significant efficiency initiatives, including meeting 2011 milestones for BD’s enterprise resource planning upgrade and achieving targeted savings from our ReLoCo program, which is aimed at reducing production costs.

The PIP award granted to Mr. Ludwig reflects a significant increase over his 2010 bonus of $850,000. This is attributable to the fact that the Compensation Committee purposely reduced the 2010 PIP awards to our named executive officers as part of cost-cutting efforts at BD. As a result, Mr. Ludwig received an award equal to only 66% of his target award for 2010, despite the fact that BD exceeded target performance for the year and the PIP

performance factor was 110% of target. Mr. Ludwig’s target award for 2010 was $1,284,000, and had Mr. Ludwig received a 2010 award at 110% of target, his award would have been $1,412,400, as shown below.

Comparison of CEO PIP Awards


2011 Award	Actual 2010 Award		2010 Target Award		2010 Award at 110% of Target
$1,310,308	$	850,000	$	1,284,000	$	1,412,400

Equity compensation awards

The Compensation Committee made the SAR and Performance Unit awards to the named executive officers shown on page 44. The increases in value from the prior year’s awards represent adjustments made in target award values after considering individual performance and compensation data relating to the Comparison Group. In particular, the Compensation Committee had set Mr. Elkins’ prior year’s award below what the Compensation Committee would consider a competitive level, since he was new to his role when the grant was made. The increase in the 2011 award to Mr. Elkins represents an adjustment to bring his target award into a competitive range for chief financial officers.

The Performance Units included in these awards cover the 2011-2013 performance period. The minimum and maximum performance thresholds are 1% and 11%, respectively, for revenue growth, and 26% and 34%, respectively, for ROIC. Target performance for each measure is set at the mid-point of the range. The revenue growth target for these awards is higher than the revenue growth target set for 2011 under the PIP because the Performance Units measure a three-year performance period rather than a one-year period. The Compensation Committee believes the revenue growth target for these awards represents a challenging goal for management given the current economic climate and its expected effect on BD’s near-term results.

Payout of prior Performance Unit awards

2008-2010 performance period

In November 2010, Performance Units covering the 2008-2010 performance period vested. These awards had performance targets of 8.5% currency-neutral revenue growth and 31% ROIC. Our adjusted revenue growth and ROIC over the performance period were 5.8% and 30.8%, respectively. This resulted in a payout of these awards at 44% of the share target. In determining the payout, the Compensation Committee used its discretion to eliminate the effects of acquisitions and divestitures, and a charge relating to the pending settlement of certain antitrust cases, since this settlement did not relate to BD’s underlying performance. These adjustments reduced the payout from 45% to 44%.

2009-2011 performance period

In November 2011, Performance Units covering the 2009-2011 performance period vested. These awards also had performance targets of 8.5% currency-neutral revenue growth and 31% ROIC. Our revenue growth and ROIC over the performance period were 4.5% and 29%, respectively, resulting in a payout of 20% of the share target. In determining the payout, the Committee used its discretion to eliminate the effects of acquisitions during the performance period and the litigation charge discussed above. These adjustments increased the payout from 15% to 20%.

Three-year Performance Unit payout trend

As was stated earlier, BD has been operating in a challenging economic environment the last few years. The impact of the global economic conditions on BD’s revenue growth and ROIC has also been reflected in Performance Unit payouts over this period, with the last three payouts being 77%, 44% and 20% of target,

respectively. We believe BD’s revenue growth over this time reflects slower growth in the medical technology industry generally as a result of these macroeconomic conditions, rather than weaker growth of BD relative to industry trends. However, we believe these payouts demonstrate a high degree of alignment between pay and BD’s performance against the preset targets, as shown in the table below.


Performance Period	Revenue Growth			ROIC			Performance Unit Payout
2007-2009		6.1	%		31.7	%		77	%
2008-2010		5.8	%		30.8	%		44	%
2009-2011		4.5	%		29.0	%		20	%

These reduced Performance Unit payouts have resulted in significant differences between the original grant date value of these awards and the amounts actually realized by the named executive officers, as shown below.


	2007-2009 Grant				2008-2010 Grant				2009- 2011 Grant
Name	Grant Date Value		Realized Value		Grant Date Value		Realized Value		Grant Date Value		Realized Value
Edward J. Ludwig	$	1,748,462	$	1,447,837	$	1,951,396	$	835,223	$	1,952,125	$	471,317
Vincent A. Forlenza		402,134		333,050		472,248		202,150		679,000		163,980
William A. Kozy		402,134		333,050		472,248		202,150		470,188		113,563
Gary M. Cohen		402,134		333,050		472,248		202,150		470,188		113,563

Note: Realized values are determined based on the closing BD stock price on the vesting date and include dividend reinvestment shares. Mr. Elkins is not included in this table since his first Performance Unit award was in 2010.

By contrast, while the named executive officers are not compensated based on relative shareholder returns, during the 2007-2011 period covered by these awards, BD provided an annualized total shareholder return of approximately 2.5% compared to a median return of approximately 1.2% for the Comparison Group.

Compensation arrangements following CEO succession

Mr. Forlenza was elected as BD’s Chief Executive Officer, effective October 1, 2011, the start of our 2012 fiscal year, succeeding Mr. Ludwig in that role. Mr. Ludwig will continue to serve as BD’s Chairman of the Board and an executive officer of BD through June 2012, at which time he plans to retire and also leave the Board. In connection with Mr. Forlenza’s election as Chief Executive Officer, his salary was increased from $750,000 to $900,000, effective October 1, 2011, and his target award under the PIP for fiscal year 2012 was increased to 120%. Mr. Ludwig will continue to receive his current salary for his service as executive Chairman. Mr. Ludwig’s PIP target for 2012 will remain at 120%, but he will receive a pro-rated award based on the portion of the year he is with BD. Mr. Ludwig will not receive any long-term incentive compensation in fiscal year 2012.

Other Benefits Under Our Executive Compensation Program

Company transportation

The Compensation Committee encourages Mr. Ludwig to use BD aircraft for his personal and business travel, in order to make more efficient use of his travel time, for personal security and to reduce business continuity risk. BD and Mr. Ludwig have entered into a time-sharing arrangement under which Mr. Ludwig makes payments to BD for his personal use of BD aircraft. For 2011, Mr. Ludwig’s time-share payments covered all but $3,314 of the incremental costs relating to Mr. Ludwig’s personal flights. Additional information on the time-sharing arrangement is set forth in the notes to the Summary Compensation Table on page 42.

Deferred compensation

Our Deferred Compensation and Retirement Benefit Restoration Plan is an unfunded, nonqualified plan that, among other things, allows eligible associates to defer receipt of cash compensation and shares issuable under certain equity compensation awards. The plan is offered to our eligible associates as part of a competitive compensation program. It gives eligible associates the opportunity to defer compensation on a pre-tax basis in addition to what is allowed under our tax-qualified 401(k) plan. We do not provide any guaranteed earnings on amounts deferred by the named executive officers. Earnings on these accounts are based on their individual investment elections. BD provides matching contributions on cash amounts deferred under the plan, subject to certain limits. A more complete description of the deferred compensation provisions of the plan begins on page 50.

Pension benefits

We offer retirement benefits for all of our U.S. associates. Because the Internal Revenue Code limits the maximum annual benefit that may be paid to an individual under our qualified Retirement Plan, we provide additional retirement benefits through our nonqualified Deferred Compensation and Retirement Benefit Restoration Plan. Together, these plans are designed to provide a market-competitive level of income replacement for our retirement-eligible associates, reduce associate turnover and contribute towards providing a competitive compensation package. The named executive officers participate in these plans on the same basis as all eligible associates. We do not include the value of equity compensation in calculating pension benefits. A more complete description of our pension benefits begins on page 48.

Change of control agreements

We have an agreement with each named executive officer relating to his employment following a change of control. This agreement provides the executive with continued employment for a period of two years following a change of control of BD, and provides certain benefits to the executive in the event his employment is terminated, or he leaves his employment for “good reason” (also known as a constructive termination), during this period. Generally, these benefits include a severance payment equal to a multiple of the executive’s salary and PIP award, and certain other benefits. A more complete description of the terms and potential payouts of our change of control agreements begins on page 53.

General purpose. Our change of control agreements are intended to retain the executives and provide continuity of management in the event of an actual or threatened change of control of BD. These change of control benefits are reviewed from time-to-time by the Compensation Committee to ensure that they are consistent with our compensation objectives and market practices. Based on information provided by Pay Governance, change of control arrangements are used by a substantial majority of the companies in the Comparison Group, and the terms of our agreements, including the severance multiple, are consistent with the prevailing practices at those companies. The Compensation Committee believes the benefits provided under these agreements are appropriate and are consistent with our objective of attracting and retaining highly qualified executives.

In setting the potential payments under these agreements, the Compensation Committee does not consider the wealth accumulated by the named executive officers under prior compensation awards or our benefit plans, because the Compensation Committee believes these agreements are important in protecting shareholder interests in the event of an actual or threatened change of control. In addition, while salary and PIP decisions affect the potential payouts under these agreements, this did not affect the Compensation Committee’s decision making. The Compensation Committee does not believe it is appropriate to base salary and PIP decisions on the potential effect they may have under change of control agreements that may never be triggered.

Triggering events. Our agreements contain a “double trigger”—that is, there must be a change of control of BD and a termination of the executive’s employment in order for any payments to be made. We opted for a

double-trigger, rather than a “single trigger” that provides for severance payments solely on the basis of a change of control, since a double trigger is consistent with the purpose of encouraging the continued employment of the executive following a change of control.

Tax reimbursement payments. In certain instances, payments made to a named executive officer on account of his termination may be subject to a 20% excise tax. To offset the effect of the excise tax, we will reimburse the named executive officer for the excise tax. We provide for these payments because they allow an executive to recognize the full intended economic benefit of his agreement and eliminate unintended disparities between executives that the excise tax can arbitrarily impose, owing to the particular structure of this tax provision. However, while we believe these tax reimbursement provisions serve a valid purpose, in light of trends in executive compensation practices, any new change of control agreements that we enter into with our executive officers will not contain these provisions.

Other change of control provisions

Upon a change of control, all outstanding equity compensation awards granted to our associates, including the named executive officers, immediately vest. Unlike the “double trigger” discussed above, no termination of employment is required for the accelerated vesting of the awards. This “single-trigger” vesting provides our associates with the same opportunity as our shareholders to realize the value created by the transaction.

Significant Policies and Additional Information Regarding Executive Compensation

Recovery of prior compensation

The Board of Directors has adopted a policy that gives the Board the discretion to require a member of the BD Leadership Team to reimburse BD for any PIP award or Performance Unit payout that was based on financial results that were subsequently restated as a result of such member’s misconduct. The Board also has the discretion to cancel any equity compensation awards (or recover payouts under such awards) that were granted to such person with respect to the restated period, and require the person to reimburse BD for any profits realized on any sale of BD stock occurring after the public issuance of the financial statements that were subsequently restated. The BD Leadership Team consists of 50 members of senior management, and includes the named executive officers.

The policy also gives the Board the authority to require those members of the BD Leadership Team who were not involved in the misconduct to reimburse BD for the amount by which their PIP award or Performance Unit payouts exceeded the amount they would have received based on the restated results.

Share retention and ownership guidelines

In order to increase executive share ownership and promote a long-term perspective when managing our business, our share retention and ownership guidelines require the named executive officers and other members of the BD Leadership Team to retain in BD stock 75% of the net after-tax proceeds from any equity compensation awards until the person achieves the required ownership level. The required ownership levels are as follows:


Chairman			5 times salary
Chief Executive Officer and President			5 times salary
Other Executive Officers (7 persons)			3 times salary
Other BD Leadership Team Members			1 times salary

Shares held directly, shares held indirectly through our 401(k) plan and deferred compensation plan, and time-vested restricted stock units are included in determining a person’s share ownership. Each of the named executive officers has holdings in excess of his ownership requirement, other than Mr. Elkins, who joined BD in December 2008. We have a policy that prohibits our associates from engaging in options, puts, calls or other transactions that are intended to hedge against the economic risk of owning BD shares.

Timing of equity awards

The Compensation Committee has adopted a policy that prohibits the backdating of any equity grant and requires our annual equity compensation awards and any “off-cycle” awards approved by our CEO to be made on fixed dates. The policy also prohibits manipulating the timing of either the public release of information or the grant of an award in order to increase the value of the award. Under the policy, the exercise price of any stock option or SAR award will be the closing price of BD stock on the grant date.

Tax considerations

Section 162(m) of the Internal Revenue Code precludes BD from taking a federal income tax deduction for compensation paid in excess of $1 million to a named executive officer. This limitation does not apply, however, to “performance-based” compensation, which includes SARs, stock options, Performance Units and PIP awards. Salary does not constitute “performance-based” compensation and is subject to the limitations of Section 162(m). While the Compensation Committee generally attempts to preserve the deductibility of compensation paid to the named executive officers, the Compensation Committee believes the primary purpose of our compensation program is to support BD’s business strategy and the long-term interests of our shareholders. Therefore, the Compensation Committee maintains the flexibility to award compensation that may be subject to the limits of Section 162(m) if doing so furthers the objectives of our executive compensation program.

COMPENSATION OF NAMED EXECUTIVE OFFICERS

The following table shows the compensation provided by BD to each of the named executive officers.

2011 SUMMARY COMPENSATION TABLE


Name and Principal Position	Year		Salary(1)		Bonus			Stock Awards(2)		Option Awards(2)		Non-Equity Incentive Plan Compensation(3)		Change in Pension Value and Nonqualified Deferred Compensation Earnings(4)		All Other Compensation(5)		Total
Edward J. Ludwig		2011	$	1,092,500		0		$	3,135,649	$	3,227,045	$	1,310,308	$	1,287,970	$	37,801	$	10,091,273
Chairman and Chief		2010		1,070,000		0			2,926,049		2,965,638		850,000		2,158,930		34,405		10,005,022
Executive Officer		2009		1,070,000		0			2,928,188		1,599,932		1,500,000		2,918,894		33,055		10,050,069
Vincent A. Forlenza		2011		725,000		0			1,393,622		1,434,250		723,077		709,038		33,867		5,018,854
President and Chief		2010		650,000		0			1,064,038		1,078,417		510,000		1,019,476		36,352		4,358,283
Operating Officer		2009		622,538		0			1,018,500		556,504		625,000		1,108,180		36,202		3,966,924
David V. Elkins		2011		575,000		0			846,106		870,794		550,000		42,863		70,693		2,955,456
Executive Vice President and Chief Financial Officer		2010 2009		500,000 413,462	$	250,000 220,000	(6) (7)		638,393 327,829		647,047 0		325,000 350,000		36,394 13,697		52,145 78,381		2,448,979 1,403,369
William A. Kozy		2011		588,500		0			846,106		870,794		500,000		575,624		33,701		3,414,725
Executive Vice		2010		575,000		0			782,014		792,630		372,000		993,335		41,657		3,556,636
President		2009		567,154		0			705,313		385,383		470,000		1,213,906		35,446		3,377,202
Gary M. Cohen		2011		583,500		0			846,106		870,794		470,000		356,996		33,696		3,161,092
Executive Vice		2010		570,000		0			782,014		792,630		319,000		586,216		34,022		3,083,882
President		2009		564,769		0			705,313		385,383		450,000		734,407		31,982		2,871,854

(1)	Salary. BD’s fiscal year ends September 30. The amounts shown in the “Salary” column reflect three months of salary at one calendar year rate and nine months at the following calendar year rate.

(2)

Stock Awards and Option Awards. The amounts shown in the “Stock Awards” column (which includes performance-based and time-vested restricted stock units) and “Option Awards” column (which includes stock appreciation rights) reflect the grant date fair value of the awards under FASB ASC Topic 718 (disregarding estimated forfeitures). For a description of the methodology and assumptions used to determine the amounts reflected in these columns, see the notes to the consolidated financial statements contained in our Annual Reports on Form 10-K for the fiscal years ended September 30, 2011, 2010 and 2009, respectively.

Amounts included in the “Stock Awards” column for 2011 represent awards of Performance Units, which are performance-based restricted stock units. The amounts shown represent the grant date fair value of these awards at target payout. Below are the grant date fair values of these awards, assuming maximum payout (200% of target):


Name	Value at maximum payout
Edward J. Ludwig	$	6,271,298
Vincent A. Forlenza		2,787,244
David V. Elkins		1,692,212
William A. Kozy		1,692,212
Gary M. Cohen		1,692,212

(3)	Non-Equity Incentive Plan Compensation. Includes amounts earned under BD’s Performance Incentive Plan. These amounts are paid in January following the fiscal year in which they are earned, unless deferred at the election of the named executive officer.

(4)	Change in Pension Value and Nonqualified Deferred Compensation Earnings.

Pension—Amounts shown are the aggregate changes in the actuarial present value of accumulated benefits under our defined benefit pension plans (including our restoration plan). These amounts represent the difference between the present value of accumulated pension benefits at normal retirement age at the beginning and end of the fiscal year. Information regarding our pension plans begins on page 48. BD’s plans allow for early retirement without any reduction in benefits if a participant’s combined age and years of service reach a certain amount. The aggregate changes in the actuarial present value of accumulated pension benefits for the named executive officers in 2011 using the earliest date they can retire without any reduction in pension benefits rather than the normal retirement date are follows (Messrs. Ludwig, Forlenza and Kozy are currently eligible to retire without any reduction in benefits): Edward J. Ludwig — $20,946; Vincent A. Forlenza — $313,210; David V. Elkins —$42,863; William A. Kozy — $31,566; and Gary M. Cohen — $372,625.

Deferred Compensation—Earnings on nonqualified deferred compensation are not included in this column, since no named executive officer earned above-market or preferential earnings on nonqualified deferred compensation during the fiscal years shown. Information on the named executive officers’ nonqualified deferred compensation accounts is on page 51.

(5)	All Other Compensation. Amounts shown for fiscal year 2011 include the following:


	Edward J. Ludwig		Vincent A. Forlenza		David V. Elkins		William A. Kozy		Gary M. Cohen
Matching contributions under plans	$	33,075	$	33,075	$	33,075	$	33,075	$	33,075
Use of corporate transportation		3,564		—		—		—		—
Relocation benefits		—		—		37,618		—		—
Term life insurance		1,162		792		—		626		621

Total	$	37,801	$	33,867	$	70,693	$	33,701	$	33,696

The following is a description of these benefits:

•

Matching Contributions Under Plans—The amounts shown reflect matching contributions made by BD pursuant to our 401(k) plan and deferred compensation plan.

•

Use of Corporate Transportation—Pursuant to a policy adopted by the Board of Directors, Mr. Ludwig is encouraged to use BD aircraft for his personal and business travel. The value of Mr. Ludwig’s personal use of BD aircraft is measured by the incremental variable costs incurred by BD in connection with these personal flights that are not reimbursed by Mr. Ludwig. These variable costs include fuel, trip-related maintenance, crew travel expenses, on-board catering, and landing and parking fees. If the aircraft flies empty before or after picking up or dropping off Mr. Ludwig at a destination, the costs of the empty flight are included in the incremental cost. Since BD aircraft are used predominantly for business purposes, we do not include fixed costs that do not change in amount based on usage, such as depreciation and pilot salaries.

BD and Mr. Ludwig have entered into a time-sharing arrangement under which Mr. Ludwig makes time-share payments to BD for his personal use of BD aircraft. The payments are for the maximum amount permitted by Federal Aviation Administration regulations without subjecting BD to regulation as a charter carrier. Mr. Ludwig’s payments under this arrangement for personal flights taken in fiscal year 2011 covered all but $3,314 of the variable costs incurred by BD in connection with these flights.

BD also makes available a driver and BD-leased car to Mr. Ludwig on occasion for commuting to and from work. The incremental costs incurred by BD in connection with this transportation are fuel charges and any other variable costs related to such use. Since BD-leased cars are used predominantly for business purposes, we have not included fixed costs, such as driver salaries, which do not change based on usage.

Mr. Ludwig is responsible for the payment of any tax on any income imputed to him as a result of his personal use of corporate transportation.

•

Relocation Benefits—In connection with his joining BD, we extended certain relocation benefits to Mr. Elkins. These include a monthly housing allowance and reimbursement for travel and other costs. BD also pays any related taxes that may be payable by Mr. Elkins on his relocation benefits. For fiscal year 2011, tax reimbursements paid to Mr. Elkins in connection with these relocation benefits were $16,168. These relocation benefits ended during fiscal year 2011.

•

Term Life Insurance—BD provides incremental term life insurance benefits to certain named executive officers beyond those provided to BD associates generally. The amounts shown reflect the dollar value of the insurance premiums paid by BD for this incremental insurance.

(6)	Represents amount paid pursuant to Mr. Elkins’ sign-on agreement to compensate him for the forfeiture of equity awards he had received from his former employer.

(7)	Represents amount paid as a sign-on bonus at the commencement of Mr. Elkins’ employment in December 2008.

INFORMATION REGARDING PLAN AWARDS IN FISCAL YEAR 2011

Set forth below is information regarding awards provided to the named executive officers in fiscal year 2011. The non-equity incentive awards were made under the BD Performance Incentive Plan. The equity awards were made under BD’s 2004 Employee and Director Equity-Based Compensation Plan.

Grants of Plan-Based Awards in Fiscal Year 2011


					Estimated Possible Payouts Under Non-Equity Incentive Plan Awards(2)						Estimated Future Payouts Under Equity Incentive Plan Awards(3)						All Other Option Awards: Number of Securities Underlying Options		Exercise or Base Price of Option Awards ($/Sh)(4)		Grant Date Fair Value of Stock and Option Awards(5)
Name	Award Type(1)		Grant Date		Threshold ($)		Target ($)		Maximum ($)		Threshold (#)		Target (#)		Maximum (#)				Exercise or Base Price of Option Awards ($/Sh)(4)		Grant Date Fair Value of Stock and Option Awards(5)
Edward J. Ludwig		PIP		N/A	$	983,250	$	1,311,000	$	2,622,000
		PU		11/23/2010								409		40,914		81,828					$	3,135,649
		SAR		11/23/2010														192,086	$	76.64		3,227,045
Vincent A. Forlenza		PIP		N/A		543,750		725,000		1,450,000
		PU		11/23/2010								182		18,184		36,368						1,393,622
		SAR		11/23/2010														85,372	$	76.64		1,434,250
David V. Elkins		PIP		N/A		345,000		460,000		920,000
		PU		11/23/2010								110		11,040		22,080						846,106
		SAR		11/23/2010														51,833	$	76.64		870,794
William A. Kozy		PIP		N/A		353,100		470,800		941,600
		PU		11/23/2010								110		11,040		22,080						846,106
		SAR		11/23/2010														51,833	$	76.64		870,794
Gary M. Cohen		PIP		N/A		350,100		466,800		933,600
		PU		11/23/2010								110		11,040		22,080						846,106
		SAR		11/23/2010														51,833	$	76.64		870,794

(1)	Award Type:

PIP = Performance Incentive Plan

PU = Performance Unit

SAR = Stock Appreciation Right

(2)

The amounts shown represent the range of possible dollar payouts that could have been earned under the BD Performance Incentive Plan for fiscal year 2011. Actual payments under the Performance Incentive Plan for fiscal year 2011 are reflected in the “Non-Equity Incentive Plan Compensation” column of the Summary Compensation Table on page 41. The amount in the “Threshold” column assumes BD achieved the minimum performance level, which results in available funding for awards at 75% of target, and that the named executive officer received a payment equal to 75% of his award target.

(3)

The amounts shown represent the range of potential share payouts under Performance Unit awards. The amount in the “Threshold” column shows the number of shares that will be paid out, assuming BD achieves the minimum performance levels required for the payment of shares. The payout amounts shown in the above table do not reflect shares that may be issued pursuant to dividend equivalent rights.

(4)	The exercise price is the closing price of BD common stock on the date of grant, as reported on the New York Stock Exchange.

(5)

The amounts shown in this column reflect the grant date fair value of the awards under FASB ASC Topic 718 used by BD for financial statement reporting purposes (disregarding estimated forfeitures). For a discussion of the assumptions made to determine the grant date fair value of these awards, see Note 7 to the consolidated financial statements that are included in our Annual Report on Form 10-K for the fiscal year ended September 30, 2011.

Description of Awards

Performance Incentive Plan

The BD Performance Incentive Plan (“PIP”) provides an opportunity for annual cash incentive payments to eligible associates. A more detailed discussion of the PIP and the performance targets established under the PIP for fiscal year 2011 appears in the Compensation Discussion and Analysis section of this proxy statement. Total awards to BD’s executive officers may not, in the absence of special circumstances, exceed 3% of our reported after-tax net income for the fiscal year.

Equity Compensation Awards

Performance Units. Performance Units are performance-based restricted stock units that vest three years after grant. The potential payouts under these awards range from zero to 200% of the award’s share target. The actual payout will be based on BD’s performance against the performance targets over the three-year performance period covering fiscal years 2011-2013. The performance goals are established at the beginning of the performance period and include an average annual revenue growth target (after excluding the effects of foreign currency translation) and an average return on invested capital target. Performance Units accrue dividend equivalents each time BD pays a dividend on its common stock, which are deemed to be reinvested in BD shares on the date the dividend is paid. Dividend equivalents accrue at the same rate as dividends are paid on BD common stock and are paid, in the form of shares, only if and when the underlying award vests. The value of the dividend equivalent rights is included in the amount shown in the above table and the “Stock Awards” column of the Summary Compensation Table. Performance Units are not transferable, and holders may not vote shares underlying the award until the shares have been distributed.

Stock-Settled Stock Appreciation Rights. A stock appreciation right (“SAR”) represents the right to receive, upon exercise, shares of BD common stock equal in value to the difference between the market price of BD common stock at the time of exercise and the exercise price. SARs have a ten-year term, and become exercisable in four equal annual installments, beginning one year following the grant date. Executive officers are required to hold 75% of the net, after-tax shares received upon exercise of the SARs for a period of one year following exercise.

Change of Control. Performance Units and SARs fully vest upon a change of control (see “Accelerated Vesting of Equity Compensation Awards Upon a Change of Control” on page 54).

OUTSTANDING EQUITY AWARDS

The following table sets forth the outstanding equity awards held by the named executive officers at the end of fiscal year 2011.

Outstanding Equity Awards at 2011 Fiscal Year-End


	Option Awards										Stock Awards
Name	Grant Date		Number of Securities Underlying Unexercised Options Exercisable(1)		Number of Securities Underlying Unexercised Options Unexercisable(1)		Option Exercise Price ($/Sh)		Option Expiration Date		Number of Shares or Units of Stock That Have Not Vested(2)		Market Value of Shares or Units of Stock That Have Not Vested(3)		Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested(4)		Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested(3)
Edward J. Ludwig		11/24/2003		98,961		0	$	38.78		11/24/2013
		11/23/2004		76,409		0	$	54.41		11/23/2014
		11/21/2005		86,819		0	$	59.16		11/21/2015
		11/21/2006		78,580		0	$	71.72		11/21/2016
		11/20/2007		56,271		18,758	$	84.33		11/20/2017
		11/25/2008		49,656		49,657	$	62.50		11/25/2018
		11/24/2009		37,635		112,905	$	75.63		11/24/2019
		11/23/2010		0		192,086	$	76.64		11/23/2020
		Various										120,914	$	8,865,414		82,026	$	6,014,146
Vincent A. Forlenza		11/24/2003		26,000		0	$	38.78		11/24/2013
		11/23/2004		22,923		0	$	54.41		11/23/2014
		11/21/2005		21,118		0	$	59.16		11/21/2015
		11/21/2006		18,073		0	$	71.72		11/21/2016
		11/20/2007		13,617		4,540	$	84.33		11/20/2017
		11/25/2008		17,272		17,272	$	62.50		11/25/2018
		11/24/2009		13,685		41,057	$	75.63		11/24/2019
		11/23/2010		0		85,372	$	76.64		11/23/2020
		Various										35,466		2,600,367		33,202		2,434,371
David V. Elkins		11/24/2009		8,211		24,634	$	75.63		11/24/2019
		11/23/2010		0		51,833	$	76.64		11/23/2020
		Various										5,607		411,105		20,054		1,470,359
William A. Kozy		11/23/2004		22,923		0	$	54.41		11/23/2014
		11/21/2005		21,118		0	$	59.16		11/21/2015
		11/21/2006		18,073		0	$	71.72		11/21/2016
		11/20/2007		13,617		4,540	$	84.33		11/20/2017
		11/25/2008		11,960		11,962	$	62.50		11/25/2018
		11/24/2009		10,058		30,177	$	75.63		11/24/2019
		11/23/2010		0		51,833	$	76.64		11/23/2020
		Various										37,441		2,745,174		22,031		1,615,313
Gary M. Cohen		11/23/2004		23,177		0	$	54.41		11/23/2014
		11/21/2005		21,353		0	$	59.16		11/21/2015
		11/21/2006		18,073		0	$	71.72		11/21/2016
		11/20/2007		13,617		4,540	$	84.33		11/20/2017
		11/25/2008		11,960		11,962	$	62.50		11/25/2018
		11/24/2009		10,058		30,177	$	75.63		11/24/2019
		11/23/2010		0		51,833	$	76.64		11/23/2020
		Various										29,038		2,129,066		22,031		1,615,313

(1)	Stock options and SARs are included in these columns. Stock options and SARs become exercisable in four equal annual installments, beginning one year following the date of grant.

Set forth below is the value of the exercisable options and SARs held by named executive officers at the end of fiscal year 2011. The value represents the difference between $73.32, the closing price of BD common stock on September 30, 2011, and the exercise price of each exercisable option or SAR held by the named executive officer. These values may not reflect the value actually realized by the named executive officers.


Name	Value of Vested Options and SARs
Edward J. Ludwig	$	6,756,299
Vincent A. Forlenza		1,846,580
David V. Elkins		0
William A. Kozy		890,934
Gary M. Cohen		899,066

(2)

The amounts shown in this column include grants of restricted stock unit awards that are not performance-based. These include time-vested units granted in fiscal year 2009 that fully vested on November 25, 2011, except the award to Mr. Elkins, which vested December 1, 2011. The amounts shown for the named executive officers (other than Mr. Elkins) also include awards that vest at, or one year following, the retirement of the named executive officer. Also includes shares under Performance Units that covered the fiscal year 2009-2011 performance period and vested on November 25, 2011.

(3)	Market value has been calculated by multiplying the number of unvested units by $73.32, the closing price of BD common stock on September 30, 2011. These values may not reflect the value actually realized by the named executive officers.

(4)

The amounts in this column represent the Performance Unit awards shown below. The amounts shown reflect the target shares issuable under the awards plus accrued dividend shares. The actual number of shares issued under these awards will be based on BD’s performance over the applicable performance period.


For Mr. Ludwig:

Grant Date	Number of Shares Issuable		Performance Period	Vesting Date
11/24/2009		40,273	Fiscal years 2010-2012	11/24/2012
11/23/2010		41,753	Fiscal years 2011-2013	11/23/2013

For Mr. Forlenza:

Grant Date	Number of Shares Issuable		Performance Period	Vesting Date
11/24/2009		14,645	Fiscal years 2010-2012	11/24/2012
11/23/2010		18,557	Fiscal years 2011-2013	11/23/2013

For Mr. Elkins:

Grant Date	Number of Shares Issuable		Performance Period	Vesting Date
11/24/2009		8,787	Fiscal years 2010-2012	11/24/2012
11/23/2010		11,267	Fiscal years 2011-2013	11/23/2013

For Messrs. Kozy and Cohen:

Grant Date	Number of Shares Issuable		Performance Period	Vesting Date
11/24/2009		10,764	Fiscal years 2010-2012	11/24/2012
11/23/2010		11,267	Fiscal years 2011-2013	11/23/2013

STOCK OPTION EXERCISES AND VESTING OF STOCK UNITS

The following table contains information relating to the exercise of stock options and the vesting of Performance Units during fiscal year 2011.

Option Exercises and Stock Vested in Fiscal Year 2011


	Option Awards				Stock Awards
Name	Number of Shares Acquired on Exercise		Value Realized on Exercise(1)		Number of Shares Acquired on Vesting(2)		Value Realized on Vesting(3)
Edward J. Ludwig		220,000	$	11,410,006		10,730	$	835,223
Vincent A. Forlenza		45,692		2,516,650		2,597		202,150
William A. Kozy		26,000		1,226,583		2,597		202,150
Gary M. Cohen		30,000		1,269,414		2,597		202,150

(1)	Represents the difference between the exercise price of the stock options and the fair market value of BD common stock at exercise.

(2)	Shows the shares (including dividend reinvestment shares) vesting in November 2010 under Performance Units that covered the fiscal year 2008-2010 performance period.

(3)	Based on the closing price of BD stock of $77.84 on the vesting date.

OTHER COMPENSATION

Retirement Plan

General. BD’s Retirement Plan is a non-contributory defined benefit plan that provides for normal retirement at age 65 and permits earlier retirement in certain cases. The Retirement Plan is generally available to all active full-time and part-time BD associates.

The Retirement Plan provides benefits on either a “final average pay” basis or on a “cash balance” basis. Under the final average pay provisions, benefits are based upon an associate’s years of service and compensation for the five consecutive calendar years that produce the highest average annual compensation. The covered compensation includes salary, commissions and PIP awards. Under the cash balance provisions, an associate has an account that is increased by pay credits based on compensation, age and service, and interest credits based on the rate prescribed by the plan. The benefits for all associates joining BD after April 1, 2007 are calculated in accordance with the cash balance provisions of the Retirement Plan. Equity compensation is not included in calculating benefits under the plan. Messrs. Ludwig, Forlenza, Kozy and Cohen participate under the final average pay provisions of the plan, while Mr. Elkins participates under the cash balance provisions.

Under the final average pay provisions, the Retirement Plan is integrated with Social Security, which means that BD provides a higher pension benefit with respect to an associate’s compensation that exceeds the Social Security wage base than on compensation that is subject to the Social Security tax. This feature of the Retirement Plan accounts for the fact that Social Security benefits will not be paid to the associate with respect to compensation that exceeds the Social Security wage base.

Deferred Compensation and Retirement Benefit Restoration Plan. The Internal Revenue Code limits the maximum annual benefit that may be paid to an individual under the Retirement Plan and the amount of compensation that may be recognized in calculating these benefits. BD makes supplemental payments to its Deferred Compensation and Retirement Benefit Restoration Plan to offset any reductions in benefits that result

from these limitations. BD’s obligations to pay retirement benefits under the Deferred Compensation and Retirement Benefit Restoration Plan are funded through a trust. The trust is currently secured by a letter of credit. The trustee is required to draw on the letter of credit, up to specified limits, following a change of control of BD (as defined in the trust agreement).

Estimated Benefits. The following table shows the lump sum actuarial present value on September 30, 2011 of accumulated retirement benefits payable under our plans at the earliest date on which the named executive officer can retire without any reduction in retirement benefits, assuming benefits payable as a single life annuity (see discussion of early retirement benefits below). For a description of the other assumptions used in calculating the present value of these benefits, see Note 8 to the consolidated financial statements contained in our Annual Report on Form 10-K for the year ended September 30, 2011.

PENSION BENEFITS AT 2011 FISCAL YEAR-END


Name	Plan name	Number of years credited service	Present value of accumulated benefit
Edward J. Ludwig	Retirement Plan	32	$	1,361,310
	Restoration Plan	32		14,420,084
Vincent A. Forlenza	Retirement Plan	31		1,421,828
	Restoration Plan	31		5,705,014
David V. Elkins	Retirement Plan	3		32,460
	Restoration Plan	3		58,573
William A. Kozy	Retirement Plan	37		1,628,956
	Restoration Plan	37		5,393,557
Gary M. Cohen	Retirement Plan	28		1,183,922
	Restoration Plan	28		3,987,022

Amounts shown are not subject to any further deduction for Social Security benefits or other offsets. Associates may elect to receive a lifetime pension or the actuarial value of their retirement benefits in a lump sum, as described below.

Calculation of Benefits.

Final Average Pay Provisions. The monthly pension benefit payable in cases of retirement at normal retirement age under the final average pay provisions of the Retirement Plan is calculated using the following formula:

(1% of average final covered compensation, plus 1.5% of average final excess compensation)

multiplied by years and months of credited service

For purposes of the formula, “average final covered compensation” is generally the portion of an associate’s covered compensation subject to Social Security tax, and “average final excess compensation” is the portion that is not subject to such tax.

Cash Balance Provisions. Each month, an associate’s cash balance account is credited with an amount equal to a percentage of the associate’s total compensation for the month (generally, salary and other forms of regular compensation, including commissions and PIP awards). Such percentage is calculated as follows:


Age plus years of Credited Service as of the upcoming December 31		Credit Percentage
Less than 40		3%
40-49		4%
50-59		5%
60-69		6%
70 or more		7%

In addition, each month the associate’s account is credited with interest. The rate used during the year is determined based on the 30-year U.S. Treasury rates in effect during the prior September.

Early Retirement. Early retirement is available for an associate who has reached age 55 and has at least 10 years of vesting service. Messrs. Ludwig, Forlenza and Kozy are currently eligible for early retirement under the plans.

Under the final average pay provisions of the Retirement Plan, an associate’s pension benefit is reduced by 4/10 of 1% (0.004) for each month that the associate receives benefits before the earlier of (i) age 65 or (ii) the date the associate’s age plus years of credited service would have equaled 85 had his or her employment continued. For example, if an associate were to retire at age 63 with 22 years of service, the associate’s benefit would not be reduced, because the sum of the associate’s age and service equals 85.

Under the cash balance provisions, the amount of the associate’s benefit will be the associate’s account balance on the early retirement date. The associate may elect to begin payment of the account balance on the early retirement date or delay payment until the normal retirement date.

Form of Benefit. Participants may elect to receive their benefits in various forms. Participants may select a single life annuity, in which pension payments will be payable only during the associate’s lifetime. Associates may also elect to receive their benefits in a single lump sum payment. Under the final average pay provisions, this lump sum is actuarially equivalent to the benefit payable under the single life annuity option. Under the cash balance provisions, the lump sum is equal to the associate’s account balance.

Married participants may select a joint and survivor annuity option. Under this option, the associate receives a reduced benefit during his or her lifetime, and, upon death, the associate’s spouse will receive monthly payments for the remainder of the spouse’s lifetime. The associate can choose a continuation benefit of 50%, 75% or 100% of the amount that was paid to the associate. The degree to which the pension benefit is reduced depends upon the age difference of the associate and the spouse, and on the percentage of the continuation benefit that is selected.

Associates may also select a guaranteed payment option. The associate chooses a designated number of guaranteed monthly payments (either a 60-month minimum guarantee or a 120-month minimum guarantee). If the associate dies before receiving all of the minimum payments, the associate’s beneficiary will receive the balance of the payments. If this option is selected, the single life annuity otherwise payable is reduced to cover the cost of the guarantee. The amount of the reduction is 3% if the 60-month option is chosen, and 7% if the 120-month option is chosen.

Deferred Compensation

Cash Deferrals. The BD Deferred Compensation and Retirement Benefit Restoration Plan is a nonqualified plan that allows an eligible BD associate to defer receipt of up to 75% of salary and/or up to 100% of a PIP award until the date or dates elected by the associate. The amounts deferred are invested in shares of BD common stock or in cash accounts that mirror the gains and/or losses of several different publicly available investment funds, based on the investment selections of the participants. The investment risk is borne solely by the participant. Participants are entitled to change their investment elections at any time with respect to prior deferrals, future deferrals or both. The plan does not offer any above-market or preferential rates of return to the named executive officers. The investment options available to participants may be changed by BD at any time.

Deferral of Equity Awards. The plan also allows associates to defer receipt of up to 100% of the shares issuable under their restricted stock unit awards. These deferred shares are allocated to the participant’s BD stock account and must stay in such account until they are distributed.

Withdrawals and Distributions. Participants may elect to receive deferred amounts either while they are still employed at BD or following termination of employment. Participants may elect to receive distributions in installments or in a lump sum. Except in the case of an unforeseen emergency, participants may not withdraw deferred funds prior to their scheduled distribution date.

Matching Contributions. BD provides matching contributions on cash amounts deferred under the plan. These contributions are made in the first calendar quarter following the calendar year in which the compensation was deferred. BD matches 75% of the first 6% of salary and PIP award deferred by a participant under the plan and our 401(k) plan combined. Matching contributions are made to the extent the total cash compensation from which a participant makes contributions to these plans does not exceed three times the limit for qualified plans.

Unfunded Liability. BD is not required to make any contributions to the plan with respect to its obligations to pay deferred compensation. BD has unrestricted use of any amounts deferred by participants. Participants have an unsecured contractual commitment from BD to pay the amounts due under the plan. When such payments are due, the cash and/or stock will be distributed from BD’s general assets. BD has purchased corporate-owned life insurance that mirrors the returns on funds contributed to the plan to substantially offset this liability.

Account Information. The following table sets forth information regarding activity during fiscal year 2011 in the plan accounts maintained by the named executive officers.

NONQUALIFIED DEFERRED COMPENSATION IN FISCAL YEAR 2011


Name	Executive contributions in last fiscal year(1)		Registrant contributions in last fiscal year		Aggregate earnings in last fiscal year			Aggregate balance at last fiscal year-end
Edward J. Ludwig	$	116,515	$	22,050	$	135,415		$	11,075,925
Vincent A. Forlenza		81,215		22,050		(14,383	)		748,134
David V. Elkins		38,769		22,050		(7,654	)		76,024
William A. Kozy		81,135		22,050		(21,926	)		806,533
Gary M. Cohen		54,129		22,050		(13,225	)		3,232,874

(1) The following amounts are reported as compensation in the fiscal year 2011 “Salary” column of the Summary Compensation Table appearing on page 41: Mr. Ludwig—$65,515; Mr. Forlenza—$50,615; Mr. Elkins—$38,769; Mr. Kozy—$58,815; and Mr. Cohen—$34,989. The remaining executive contributions relate to the deferral of fiscal year 2010 PIP awards.

Additional Arrangements

All BD associates, including the named executive officers, are eligible to participate in BD’s Matching Gift Program, pursuant to which BD matches up to $5,000 of contributions that are made by a participant to qualifying nonprofit organizations in a calendar year.

PAYMENTS UPON TERMINATION OF EMPLOYMENT OR CHANGE OF CONTROL

Payments Upon Termination of Employment

The table below shows the estimated payments and benefits that would be paid by BD to each named executive officer as a result of his termination of employment under various scenarios. The amounts shown assume termination of employment on September 30, 2011. However, the actual amounts that would be paid to the named executive officers under each scenario can only be determined at the actual time of termination.


Name	Termination following a change of control(1)		Termination due to retirement(2)		Termination without cause(3)		Termination due to disability(4)		Termination due to death(5)
Edward J. Ludwig	$	26,938,372	$	28,824,227	$	29,755,553	$	30,659,867	$	31,411,245
Vincent A. Forlenza		13,529,567		11,371,945		12,193,601		12,010,415		12,002,268
David V. Elkins		4,496,612		—		1,322,632		1,034,325		1,634,325
William A. Kozy		11,829,316		11,049,179		11,880,712		11,482,550		10,937,962
Gary M. Cohen		8,532,251		—		3,580,558		3,405,953		4,581,953

(1)

Includes amounts under change of control employment agreements (which are described below). Does not include the accelerated vesting of equity compensation awards that occurs solely upon a change of control (see table below). Because Messrs. Ludwig, Forlenza and Kozy were retirement-eligible on September 30, 2011, also included for them are early retirement benefits, assuming payout as a lump sum, in the following amounts: Mr. Ludwig—$16,793,515; Mr. Forlenza—$7,559,827; and Mr. Kozy—$7,460,489.

(2)

Includes early retirement benefits, assuming payout as a lump sum. Also includes the accelerated vesting of equity compensation awards upon retirement. The amounts shown reflect the pro rata amount of Performance Units earned as of September 30, 2011, with awards that vested in November 2011 included at their actual payout and all other Performance Units at their target payout. Messrs. Elkins and Cohen are not currently eligible for retirement.

(3)

Includes the accelerated vesting of equity compensation awards. Also includes outplacement services (with an assumed maximum cost of $100,000), health and welfare benefits and severance benefits. BD’s severance policy for U.S. associates provides for severance payments equal to two weeks’ salary for each year of service (assuming the associate grants a general release to BD), subject to a maximum of $490,000, except for instances that do not involve a reduction in force, in which case the payment of severance is at BD’s discretion. The table assumes payment of severance to the named executive officers in the amount that would be paid in a reduction in force. Also includes early retirement benefits for Messrs. Ludwig, Forlenza and Kozy, assuming payout as a lump sum.

(4)	Includes the accelerated vesting of equity compensation awards. Also includes early retirement benefits for Messrs. Ludwig, Forlenza and Kozy, assuming payout as a lump sum.

(5)

Includes the accelerated vesting of equity compensation awards, life insurance benefits, and, for Messrs. Ludwig, Forlenza and Kozy, the lump sum payment of retirement benefits under the Deferred Compensation and Retirement Benefit Restoration Plan. Benefits for these persons under our Retirement Plan would be paid out as a joint and survivor annuity and are not included in the amounts shown.

The amounts shown in the above table do not include deferred compensation that the named executive officers would be paid upon termination, which is shown on page 51. The amounts shown also do not include the value of vested stock options and SARs held by the named executive officers as of September 30, 2011. The value of these vested options and SARs appears on page 47.

Payments Upon Termination Following a Change of Control

BD has an agreement with each of the named executive officers that provides for the continued employment of the executive for a period of two years following a change of control of BD. These agreements are designed to retain key executives and provide continuity of management in the event of an actual or threatened change of control of BD. The following is a summary of the key terms of the agreements.

The agreement provides that BD will continue to employ the executive for two years following a change of control, and that, during this period, the executive’s position and responsibilities at BD will be materially the same as those prior to the change of control. The agreement also provides for minimum salary, PIP award and other benefits during this two-year period. “Change of control” is defined under the agreement generally as:

•

the acquisition by any person or group of 25% or more of the outstanding BD common stock;

•

the incumbent members of the Board ceasing to constitute at least a majority of the Board;

•

certain business combinations; and

•

shareholder approval of the liquidation or dissolution of BD.

The agreement also provides that, in the event the executive is terminated without “cause” or the executive terminates his employment for “good reason” during the two years following a change of control, the executive would receive:

•

a pro rata PIP award for the year of termination based on the higher of (i) the executive’s average PIP award for the last three fiscal years prior to termination, and (ii) his target PIP award for the year in which the termination occurs (the greater of the two being referred to herein as the “Highest Incentive Payment”);

•

a lump sum severance payment equal to three times (two times in the case of Mr. Elkins) the sum of the executive’s annual salary and his Highest Incentive Payment;

•

a lump sum payment equal to the present value of the increased pension benefits the executive would have received had he remained employed for an additional three years (two years in the case of Mr. Elkins) following termination;

•

continuation of the executive’s health and welfare benefits (reduced to the extent provided by any subsequent employer) for a period of three years (two years in the case of Mr. Elkins); and

•

outplacement services, subject to a limit on the cost to BD of $100,000.

“Cause” is generally defined as the willful and continued failure of the executive to substantially perform his duties, or illegal conduct or gross misconduct that is materially injurious to BD. “Good reason” is generally defined to include (i) any significant adverse change in the executive’s position or responsibilities, (ii) the failure of BD to pay any compensation called for by the agreement, or (iii) certain relocations of the executive.

Under the agreement, if any payments or distributions made by BD to the executive as a result of a change of control would be subject to the excise tax imposed by the Internal Revenue Code, BD will make an additional tax reimbursement payment to the executive. As a result of this payment, the executive would retain the same amount, net of all taxes, that he would have retained had the excise tax not been triggered. This provision applies to any payments or distributions resulting from the change of control, including the accelerated vesting of equity awards discussed below. However, if such payments and distributions do not exceed 110% of the level that triggers the excise tax, the payments will be reduced to the extent necessary to avoid the excise tax.

The following table sets forth the estimated benefits each named executive officer would receive under his agreement in the event he was terminated without “cause” or terminated his employment for “good reason” following a change of control. The table assumes a termination date of September 30, 2011. These estimates are

based on salary rates in effect as of September 30, 2011, and use the 2011 target PIP awards of the named executive officers as the Highest Incentive Payment. No tax reimbursement payments would have been required under the agreements, except for Mr. Elkins, as shown below.


Name	Highest Incentive Payment		Severance Payment		Additional Retirement Benefits		Health and Welfare Benefits		Outplacement Services		Tax Reimbursement		Total
Edward J. Ludwig	$	1,311,000	$	7,233,000	$	1,464,857	$	36,000	$	100,000		—	$	10,144,857
Vincent A. Forlenza		725,000		4,425,000		683,740		36,000		100,000		—		5,969,740
David V. Elkins		460,000		2,120,000		153,073		24,000		100,000	$	1,639,539		4,496,612
William A. Kozy		470,800		3,191,400		570,627		36,000		100,000		—		4,368,827
Gary M. Cohen		466,800		3,164,400		4,765,051		36,000		100,000		—		8,532,251

Accelerated Vesting of Equity Compensation Awards Upon a Change of Control

Upon a change of control, as defined in our equity compensation plans, all unvested options and SARs become fully vested and exercisable, and all time-vested and performance-based restricted stock units become fully vested and payable (with Performance Units being payable at their target amount). This accelerated vesting occurs with respect to all equity compensation awards granted by BD, not just those granted to executive officers. No termination of employment is required to trigger this acceleration.

The following table sets forth the value to the named executive officers of the accelerated vesting of the unvested equity compensation awards they held at the end of fiscal year 2011, assuming a change of control of BD occurred on September 30, 2011. The BD common stock closing price of $73.32 on September 30, 2011 is used for purposes of these calculations.


Name	Time-vested restricted stock units		Performance Units		Options/SARs		Total
Edward J. Ludwig	$	8,379,523	$	8,443,605	$	537,289	$	17,360,417
Vincent A. Forlenza		2,431,365		3,279,457		186,883		5,897,705
David V. Elkins		411,105		1,470,359		0		1,881,464
William A. Kozy		2,628,155		2,200,480		129,429		4,958,064
Gary M. Cohen		2,012,047		2,200,480		129,429		4,341,956

The value of unvested restricted stock units is calculated by multiplying the shares distributable by $73.32. The value of unvested options and SARs is calculated using the difference between the exercise price of each option or SAR and $73.32.

Equity Compensation Upon Termination

Upon a named executive officer’s termination due to retirement:

•

all unvested options and SARs held by the named executive officer become fully exercisable for their remaining term;

•

all time-vested units held by the named executive officer vest at, or on the first anniversary of, retirement; and

•

all Performance Units held by the named executive officer vest pro rata based on the amount of the vesting period that had elapsed. The payments would be made after the end of the applicable performance periods and would be based on BD’s actual performance for those periods, rather than award targets.

Upon a named executive officer’s termination due to involuntary termination without cause:

•

the named executive officer is entitled to exercise his stock options and SARs for three months following termination, but only to the extent they were vested at the time of termination;

•

all time-vested units held by the named executive officer fully vest; and

•

Upon a named executive officer’s termination due to death or disability:

•

all unvested options and SARs held by the named executive officer become fully exercisable for their remaining term;

•

all time-vested units held by the named executive officer fully vest; and

•

all Performance Units held by the named executive officer vest pro rata based on the amount of the vesting period that had elapsed. The payment would be based on award targets.

Proposal 2.

RATIFICATION OF SELECTION OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

Ernst & Young LLP (“E&Y”) has been selected by the Audit Committee of the Board to audit the accounts of BD and its subsidiaries for the fiscal year ending September 30, 2012. A representative of E&Y is expected to attend the 2012 Annual Meeting to respond to appropriate questions and will have the opportunity to make a statement.

Listed below are the fees billed to BD by E&Y for services rendered during fiscal years 2011 and 2010:


	2011		2010
Audit Fees	$	7,287,000	$	7,680,000	“Audit Fees” include fees associated with the annual audit of BD’s consolidated financial statements, reviews of BD’s quarterly reports on Form 10-Q, registration statements filed with the SEC and statutory audits required internationally.

Audit Related Fees	$	488,500	$	119,000	“Audit Related Fees” consist of assurance and related services that are reasonably related to the performance of the audit or interim financial statement review and are not reported under Audit Fees. These services include benefit plan audits and other audit services requested by management, which are in addition to the scope of the financial statement audit.

Tax Fees	$	198,000	$	211,000	“Tax Fees” includes tax compliance, assistance with tax audits, tax advice and tax planning.

All Other Fees	$	18,000	$	38,000	“All Other Fees” includes various miscellaneous services.

Total	$	7,991,500	$	8,048,000

Pre-Approval of Audit and Non-Audit Services

The Audit Committee is responsible for appointing BD’s independent registered public accounting firm (the “independent auditors”) and approving the terms of the independent auditors’ services. The Audit Committee has established a policy for the pre-approval of all audit and permissible non-audit services to be provided by the independent auditors, as described below. All of the services listed in the above table were approved pursuant to this policy.

Audit Services. Under the policy, the Audit Committee will appoint BD’s independent auditors each fiscal year and pre-approve the engagement of the independent auditors for the audit services to be provided.

Non-Audit Services. In accordance with the policy, the Audit Committee has established detailed pre-approved categories of non-audit services that may be performed by the independent auditors during the fiscal year, subject to the dollar limitations set by the Audit Committee. The Audit Committee has also delegated to the Chair of the Audit Committee the authority to approve additional non-audit services to be performed by the independent auditors, subject to certain dollar limitations, and provided that the full Audit Committee is informed of each service. All other non-audit services are required to be pre-approved by the entire Audit Committee.

The Audit Committee believes that the provision of the non-audit services described above by E&Y is consistent with maintaining the independence of E&Y.

THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR PROPOSAL 2. IF RATIFICATION IS WITHHELD, THE AUDIT COMMITTEE WILL RECONSIDER ITS SELECTION.

REPORT OF THE AUDIT COMMITTEE

The Audit Committee reviews BD’s financial reporting process on behalf of the Board of Directors. Management has the primary responsibility for the financial statements and the reporting process, including the system of internal controls. The independent auditors are responsible for performing an independent audit of the Company’s consolidated financial statements in accordance with generally accepted auditing standards and to issue a report thereon. The Committee monitors these processes.

In this context, the Committee met and held discussions with management and the independent auditors. Management represented to the Committee that the Company’s consolidated financial statements were prepared in accordance with accounting principles generally accepted in the United States, and the Committee reviewed and discussed the consolidated financial statements with management and the independent auditors. The Committee also discussed with the independent auditors the matters required to be discussed by the statement on Auditing Standards No. 61 (Codification of Statements on Auditing Standards, AU 380), as amended, as adopted by the Public Company Accounting Oversight Board in Rule 3200T.

In addition, the Committee discussed with the independent auditors the auditors’ independence from BD and its management, and the independent auditors provided to the Committee the written disclosures and the letter pursuant to the applicable requirements of the Public Company Accounting Oversight Board regarding the independent auditor’s communications with the Committee concerning independence. The Committee discussed with BD’s internal and independent auditors the overall scope and plans for their respective audits. The Committee met with the internal and independent auditors, with and without management present, to discuss the results of their examinations, their evaluations of BD’s internal controls, and the overall quality of BD’s financial reporting. Management has also reviewed with the Audit Committee its report on the effectiveness of BD’s internal control over financial reporting. The Audit Committee also received the report from the independent auditors on BD’s internal control over financial reporting.

Based on the reviews and discussions referred to above, the Committee recommended to the Board of Directors, and the Board has approved, that the audited financial statements be included in the Company’s Annual Report on Form 10-K for the fiscal year ended September 30, 2011, for filing with the Securities and Exchange Commission.

AUDIT COMMITTEE

Basil L. Anderson, Chair

Christopher Jones

Marshall O. Larsen

Gary A. Mecklenburg

James F. Orr

Bertram L. Scott

Proposal 3.

ADVISORY VOTE ON EXECUTIVE COMPENSATION

The Compensation Discussion and Analysis beginning on page 27 of this proxy statement describes BD’s executive compensation program and the compensation decisions made by the Compensation and Benefits Committee and the Board of Directors in 2011 with respect to our Chief Executive Officer and the other officers named in the Summary Compensation Table on page 41 (who we refer to as the “named executive officers”). The Board of Directors is asking shareholders to cast a non-binding advisory vote on the following resolution:

“RESOLVED, that the shareholders of Becton, Dickinson and Company (“BD”) approve the compensation of the BD executive officers named in the Summary Compensation Table, as disclosed in this proxy statement pursuant to the compensation disclosure rules of the Securities and Exchange Commission (which disclosure includes the Compensation Discussion and Analysis, the executive compensation tables and the related footnotes and narrative accompanying the tables).”

As we describe in the Compensation Discussion and Analysis, our executive compensation program embodies a pay-for-performance philosophy that supports BD’s business strategy and aligns the interests of our executives with our shareholders. At the same time, our program does not encourage excessive risk-taking by management. We believe that the compensation actions taken for 2011 appropriately reflected the performance of our named executives and BD during the year under challenging economic conditions, and that payouts under our long-term incentive compensation demonstrate a high degree of alignment with BD’s performance against the targets set by our Compensation and Benefits Committee.

For these reasons, the Board is asking shareholders to support this proposal. While the advisory vote we are asking you to cast is non-binding, the Compensation and Benefits Committee and the Board value the views of our shareholders and will take into account the outcome of the vote when considering future compensation decisions for our named executive officers. BD holds an advisory vote on executive compensation on an annual basis.

THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR PROPOSAL 3.

Proposal 4.

SHAREHOLDER PROPOSAL ON CUMULATIVE VOTING

Mrs. Evelyn Y. Davis, Watergate Office Building, 2600 Virginia Avenue N.W., Suite 215, Washington, DC 20037, owner of 800 shares of BD common stock, has informed BD that she plans to introduce the following proposal at the meeting:

RESOLVED: “That the stockholders of Becton Dickinson, assembled in Annual Meeting in person and by proxy, hereby request the Board of Directors to take the necessary steps to provide for cumulative voting in the election of directors, which means each stockholder shall be entitled to as many votes as shall equal the number of shares he or she owns multiplied by the number of directors to be elected, and he or she may cast all of such votes for a single candidate, or any two or more of them as he or she may see fit.”

REASONS: “Many states have mandatory cumulative voting, so do National Banks.”

“In addition, many corporations have adopted cumulative voting.”

“Last year the owners of 59,339,952 shares, representing approximately 36.6% of shares voting voted FOR this proposal.”

“If you AGREE, please mark your proxy FOR this resolution.”

* * *

BOARD OF DIRECTORS’ RESPONSE

The Board of Directors recommends a vote AGAINST Proposal 4 for the following reasons:

The Board continues to believe that BD’s current system of electing directors, where each share is entitled to one vote for each nominee, is most likely to promote the election of a diverse board that represents the interests of all shareholders, not just those of particular groups. Cumulative voting could enable shareholders to pool their votes to elect directors concerned with advancing the positions of the group responsible for their election, rather than positions that are in the best interests of BD and all shareholders. Directors supporting the special interests of the constituencies that elected them could create partisanship and divisiveness among Board members and impair the Board’s ability to operate effectively as a governing body. Our voting system, which is followed by most S&P 500 companies, prevents the accumulation of votes for potentially partisan nominees. In addition, in the past few years, our Board has taken steps to further strengthen the accountability of directors to our shareholders, including adopting majority voting in uncontested elections and providing for the annual election of directors. We believe this proposal is contrary to the goal of holding directors accountable to all our shareholders. For these reasons, we believe this proposal is not in the best interests of BD or our shareholders.

ACCORDINGLY, THE BOARD OF DIRECTORS RECOMMENDS A VOTE AGAINST PROPOSAL 4.

SHAREHOLDER PROPOSALS OR DIRECTOR NOMINATIONS FOR 2013 ANNUAL MEETING

Any proposal that a shareholder wishes to submit for inclusion in BD’s proxy materials for the 2013 Annual Meeting pursuant to SEC Rule 14a-8 must be received by BD not later than August 24, 2012. Notice of any other proposal or director nomination that a shareholder wishes to submit for consideration at the 2013 Annual Meeting pursuant to BD’s By-Laws must be delivered to BD not earlier than October 3, 2012 and not later than November 2, 2012. Such other proposal or director nomination also must satisfy the information and other requirements specified in BD’s By-Laws, which are available on BD’s website at www.bd.com/investors/ corporate_governance/. Any shareholder proposal or director nomination submitted to BD in connection with the 2013 Annual Meeting should be addressed to: Corporate Secretary, BD, 1 Becton Drive, Franklin Lakes, New Jersey 07417-1880.

DIRECTIONS TO

THE HILTON SHORT HILLS

FROM MANHATTAN

Lincoln or Holland Tunnel to NJ Tpk to Exit 14. Continue on Rte. 78 West approx. 5 miles to

Exit 48, Rte. 24 West. Take Exit 7C…* *

FROM BROOKLYN

Take Rte. 278/Belt Pkwy West to Verrazano

Narrows Bridge. Continue to the Goethals Bridge

to the NJ Tpk. North. Take Exit 14. Continue on

Rte. 78 West approx. 5 miles to Exit 48, Rte. 24 West. Take Exit 7C…* *

FROM NEWARK AIRPORT

Take Rte. 78 West approx. 5 miles to Exit 48, Rte. 24 West. Take Exit 7C…* *

FROM THE NJ TURNPIKE

Take to Exit 14. Continue on Rte. 78 West approx. 5 miles to Exit 48, Rte. 24 West. Take Exit 7C…* *

FROM NORTH EASTERN

LONG ISLAND

Take Throgs Neck or Whitestone Bridge off the Cross Island Pkwy. After toll, take GW Bridge to Rte. 80 West to the Garden State Pkwy South, to Exit 142 to Rte. 78 West. OR Take GW Bridge to the NJ Tpk South to Exit 14. Continue on Rte. 78 West approx. 5 miles to Exit 48, Rte. 24 West. Take Exit 7C…* *

FROM TAPPAN ZEE BRIDGE

Follow signs to NY Thruway; continue to Garden State Pkwy South. Take Exit 142 to Rte. 78 West. Continue to Exit 48, Rte. 24 West. Take Exit 7C…* *

FROM THE GARDEN STATE PARKWAY SOUTHBOUND

Take Exit 142 to Rte. 78 West, Continue to Exit 48, Rte. 24 West. Take Exit 7C…* *

FROM THE GARDEN STATE PARKWAY NORTHBOUND

Take Exit 142 to Rte. 78 West. Take first Exit, marked “Hillside/Rte. 78 West”. Take Rte. 78 West and continue to Exit 48, Rte. 24 West. Take Exit 7C…* *

* * FROM EXIT 7C, JFK PARKWAY, LIVINGSTON/CALDWELL - THE MALL AT SHORT HILLS WILL BE ON YOUR RIGHT. MAKE A LEFT AT THE SECOND TRAFFIC LIGHT THEN MAKE AN IMMEDIATE LEFT INTO HOTEL DRIVEWAY.

FROM ROUTE 287 SOUTHBOUND

Take Exit 37, Rte. 24 East; continue to Exit 7, “Summit/Livingston” and follow signs for JFK Parkway and Mall at Short Hills; make a left at second traffic light, then make an immediate left into the Hotel driveway.

FROM ROUTE 280 WESTBOUND

Take Exit 5A, “Livingston Avenue/Roseland”. Continue on Livingston Avenue approx. 4 miles through Livingston; cross South Orange Avenue, name will change to JFK Parkway. Continue on JFK Parkway; Hotel is approx. 1.5 miles down on right, opposite Mall at Short Hills.

Electronic Voting Instructions

You can vote by Internet or telephone

Available 24 hours a day, 7 days a week

Instead of mailing your proxy, you may choose one of the two voting methods outlined below to vote your proxy.

Vote by Internet

LOGO

• Log on to the Internet and go to www.investorvote.com/BDX

• Follow the steps outlined on the secured website.

Vote by telephone

• Within the USA, US territories & Canada, call toll free

1-800-652-VOTE (8683) on a touch tone telephone.

There is NO CHARGE to you for the call.

• Outside the USA, US territories & Canada, call

1-781-575-2300 on a touch tone telephone. Standard rates will

apply.

• Follow the instructions provided by the recorded message.

VALIDATION DETAILS ARE LOCATED BELOW IN THE TITLE BAR.

Using a black ink pen, mark your votes with an X as shown in this example. Please do not write outside the designated areas.

Voting instructions submitted by GSIP participants must be received by 12:00 p.m., EST, on January 25, 2012. Voting instructions submitted by all other BD plan participants must be received by 12:00 p.m., EST, on January 27, 2012. All proxies submitted by record holders through the Internet or telephone must be received by 11:00 a.m., EST, on January 31, 2012.

q IF YOU DO NOT VOTE VIA THE INTERNET OR TELEPHONE, FOLD ALONG THE PERFORATION, DETACH AND RETURN THE BOTTOM PORTION IN THE ENCLOSED ENVELOPE. q


		A		Proposals — The Board of Directors recommends a vote FOR all the nominees listed; FOR Proposals 2 and 3; and AGAINST Proposal 4.

1. Election of Directors:

For

Against

Abstain

For

Against

Abstain

For

Against

Abstain

01 - Basil L. Anderson

06 - Christopher Jones

11 - James F. Orr

02 - Henry P. Becton, Jr.

07 - Marshall O. Larsen

12 - Willard J. Overlock, Jr.

03 - Edward F. DeGraan

08 - Edward J. Ludwig

13 - Bertram L. Scott

04 - Vincent A. Forlenza

09 - Adel A.F. Mahmoud

14 - Alfred Sommer

05 - Claire M. Fraser-Liggett

10 - Gary A. Mecklenburg

For

Against

Abstain

For

Against

Abstain

2. Ratification of selection of independent registered public accounting firm.

4. Cumulative Voting.

3. Advisory vote on executive compensation.


		B		Authorized Signatures — This section must be completed for your vote to be counted. — Date and Sign Below

Please sign exactly as name(s) appears hereon. Joint owners should each sign. When signing as attorney, executor, administrator, corporate officer, trustee, guardian, custodian, or other representative capacity, please give full title.

Date (mm/dd/yyyy) — Please print date below.

Signature 1 — Please keep signature within the box.

Signature 2 — Please keep signature within the box.

/ /

IF VOTING BY MAIL, COMPLETE SECTIONS A - C ON BOTH SIDES OF THIS CARD.

LOGO

Dear Shareholder/Plan Participant:

Becton, Dickinson and Company (BD) encourages you to take advantage of convenient ways by which you can vote or direct the voting of your shares. You can vote your shares 24 hours a day, 7 days a week, using either a touch-tone telephone or through the Internet. Your telephone or Internet vote authorizes the proxies named on the below proxy/voting instruction card in the same manner as if you marked, signed, dated and returned the proxy/voting instruction card. If you choose to vote your shares by telephone or through the Internet, there is no need to mail back your proxy/voting instruction card. To vote your shares electronically, please have this voting form in hand and follow the instructions outlined on the reverse side.

Your vote is important. Thank you for voting.

q IF YOU DO NOT VOTE VIA THE INTERNET OR TELEPHONE, FOLD ALONG THE PERFORATION, DETACH AND RETURN THE BOTTOM PORTION IN THE ENCLOSED ENVELOPE. q

Proxy / Voting Instruction Card — BECTON, DICKINSON AND COMPANY

Proxy Solicited on Behalf of the Board of Directors for the Annual Meeting on January 31, 2012

The undersigned hereby appoints Vincent A. Forlenza, David V. Elkins, Jeffrey S. Sherman and Gary DeFazio, and any of them, with full power of substitution, proxies to attend the Annual Meeting of Shareholders of the Company to be held at 1:00 p.m. EST on Tuesday, January 31, 2012 at the Hilton Short Hills, 41 John F. Kennedy Parkway, Short Hills, New Jersey, and any adjournment thereof, and to vote all shares of the common stock of the Company which the undersigned is entitled to vote upon each of the matters referred to in this proxy and, in their discretion, upon such other matters as may properly come before the meeting. This does not apply to shares held through the Company plans referred to below.

Where no choice is made on the reverse side of this form, the proxies will vote FOR all Director nominees, FOR Proposals 2 and 3, and AGAINST Proposal 4.

For plan participants. This card constitutes voting instructions to the respective trustees for any shares of common stock allocated to the undersigned under the Company’s 1996 Directors’ Deferral Plan (“DDP”), the Company’s Deferred Compensation and Retirement Benefit Restoration Plan (“DCP”) and, when so provided, the Global Share Investment Program (“GSIP”), and also constitutes voting instructions to the trustees for a proportionate number of shares of common stock in the DDP, DCP and GSIP for which voting instructions have not been received. This card also constitutes voting instructions to the trustee for any shares of common stock allocated to the undersigned under the Company’s Savings Incentive Plan (“SIP”). Shares for which no voting instructions have been received by the SIP trustee will be voted in the same proportion as those for which timely instructions have been received.

You are encouraged to specify your choices by marking the appropriate boxes, SEE REVERSE SIDE. If you do not vote by telephone or over the internet, please sign and return this card using the enclosed envelope.

(Items to be voted appear on reverse side.)


		C		Non-Voting Items

Change of Address — Please print your new address below.

Comments — Please print your comments below.

Meeting Attendance


								Mark the box to the right if you plan to attend the Annual Meeting (for record holders only).		¨


¢		IF VOTING BY MAIL, COMPLETE SECTIONS A - C ON BOTH SIDES OF THIS CARD.		+