Autodesk 2012 Annual Report Download - page 29

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Despite strong financial performance, as mentioned above, our stock price was extremely volatile during
fiscal 2012. Our total stockholder return during fiscal 2012 declined 15%, with our stock price depreciating
from $42.16 on the first trading day of fiscal 2012 to $36.00 on the last trading day of fiscal 2012, with the stock
price reaching a high of $45.99 and a low of $23.41 during that period.
Our revenue increased 14% during fiscal 2012 as compared to fiscal 2011, and our non-GAAP operating
margin (which excludes stock-based compensation, amortization of certain purchased intangible assets,
restructuring charges and impairment of goodwill) increased 27% during fiscal 2012 as compared to fiscal 2011.
These results exceeded our expectations and the financial targets set at the beginning of fiscal 2012. As a result
of our financial results for fiscal 2012, our Named Executive Officers’ compensation increased from fiscal 2011
levels. Specifically:
• AsadirectresultoftheCompanyexceedingitsfinancialtargets,ourshort-termcashincentiveplan
paid out above 100% of the target funding level set at the beginning of fiscal 2012.
• Long-termequityincentivesinfiscal2012continuedtoconstituteasignificantportionofeach
of our Named Executive Officers’ compensation. The cost to the Company of this compensation
is reported in the compensation tables beginning on page 41. The value to our executives of this
type of compensation is directly linked to the performance of our stock price over time, aligning
our executives’ interests with our stockholders’ interests. As described above in this section, our
stock price depreciated 15% during fiscal 2012, and as a result the intrinsic value of equity granted
to our Named Executive Officers prior to fiscal 2012 decreased. Further, if our stock price does
not appreciate above the exercise prices, the portion of the equity compensation that consists of
stock options will have no value to our executives, despite the fact that it appears in the Summary
Compensation Table.
Compensation Governance and Practices
We have implemented a number of compensation processes, policies and practices that are consistent with
good governance of compensation practices:
• Pay-For-Performance: We emphasize variable compensation balanced between annual and long-
term performance (89% of fiscal 2012 Named Executive Officer compensation was variable).
• Long-Term Performance Orientation: The majority of Named Executive Officer compensation
(78% in fiscal 2012) is based on the long term performance of the Company.
• Significant Stock Ownership: We have implemented mandatory stock holding requirements for our
Named Executive Officers as of fiscal 2013 and annually monitor ownership progress.
• Independent Compensation Practices: Our compensation policy for our Named Executive Officers
is determined by our independent Compensation Committee, which is informed by an independent
compensation advisory consultant.
• No Change in Control Gross-Ups: The change in control program for our Named Executive Officers
and other executive officers requires both a change in control of the Company and termination of
employment (“double trigger”) and does not provide any “gross-ups.”
• Effective Risk Management: We employ a strong risk management program with specific
responsibilities assigned to management, the Board, and the Board’s committees, in addition, we have
a “no-hedging” policy in our insider trading policy.
• Relevant Benchmarking: The companies used to benchmark competitive compensation practices
are reviewed each year, with adjustments made periodically to rebalance the group and improve its
appropriateness, and supplements the use of survey data.
• No Option Re-Pricing: Re-pricing of stock grants is prohibited without explicit stockholder approval.
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