Allstate 2014 Annual Report Download - page 41

9MAR201204034531
Executive Compensation — Overview
Allstate’s Executive Compensation Practices
Allstate’s executive compensation program features many best practices.
WHAT WE DO WHAT WE DON’T DO
A significant percentage of
total target direct compensation is pay at-risk that Our executive officers are at-will
is connected to performance. employees with no employment contracts.
Performance measures for For the named executives, annual salary
incentive compensation are linked to operating increases are based on evaluations of individual
priorities designed to create long-term stockholder performance, while their annual cash incentives are
value. tied to corporate and individual performance.
The No tax gross ups are
committee retains an independent compensation provided beyond limited items which are generally
consultant to review the executive compensation available to all full time employees.
programs and practices.
The Our equity incentive plan does not permit
committee targets total direct compensation at the repricing or exchange of underwater stock options
50th percentile of peers. or stock appreciation rights without stockholder
approval, except in connection with certain
transactions involving Allstate or a change in
The committee benchmarks control.
our executive compensation program and reviews
the composition of the peer group annually with
the assistance of the independent compensation Based on the annual review, it was determined that
consultant. the company’s compensation practices are
appropriately structured and avoid incenting
employees to engage in unnecessary and excessive
Change-in-control severance benefits are three risk-taking.
times target cash compensation for the CEO and
two times target cash compensation for senior
executives. Officers, directors, and employees are prohibited
from hedging Allstate securities. Directors and
senior executives are prohibited from pledging
Beginning with grants made in 2012, Allstate securities as collateral or holding securities
equity incentive awards have a double trigger; that in a margin account, except when an exception is
is, they will not vest in the event of a change in granted by the chairman or lead director.
control unless also accompanied by a qualifying
termination of employment.
Dividend equivalents are accrued
but not paid on PSAs until the performance
We enhanced holding requirements conditions are satisfied and the PSAs vest after the
beginning with awards granted in 2014. performance measurement period.
We offer only certain limited
Certain awards made to benefits as required to remain competitive and to
executive officers are subject to clawback in attract and retain highly talented executives.
specified circumstances.
31
PROXY STATEMENT
Pay for Performance. No Employment Agreements for Executive
Officers.
Strong Link between Performance Measures and No Guaranteed Annual Salary Increases or
Strategic Objectives. Bonuses.
Independent Compensation Consultant. No Special Tax Gross Ups.
No Repricing or Exchange of Underwater Stock
Targeted Pay at 50th Percentile of Peers. Options.
Benchmark Peers of Similar Revenues and
Business Complexity.
No Plans that Encourage Excessive Risk Taking.
Moderate Change-in-Control Benefits.
No Hedging or Pledging of Allstate Securities.
Double Trigger in the Event of a Change in
Control.
No Inclusion of Equity Awards in Pension
Calculations.
Maximum Payout Caps for Annual Cash Incentive
Compensation and PSAs. No Dividends or Dividend Equivalents Paid on
Unvested PSAs.
Robust Equity Ownership and Retention
Requirements.
Clawback of Certain Compensation if Restatement No Excessive Perks.
or Covenant Breach.
The Allstate Corporation
⻬
⻬
⻬
⻬
⻬
⻬
⻬
⻬
⻬
⻬
X
X
X
X
X
X
X
X
X