Best Buy 2009 Annual Report Download - page 27

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• Encourage and recognize experimentation, The Compensation Committee established and reviews
entrepreneurship and innovation; and our Total Rewards philosophy and our compensation
objectives, and oversees the design, competitiveness and
• Reward employee contributions for achieving effectiveness of compensation programs for our
desired financial and non-financial results. executive officers. During the first quarter of each fiscal
Our compensation philosophy drives both what we do year, our Human Resources leadership team (‘‘HR’’)
and do not offer to our employees. provides the Compensation Committee with
compensation recommendations for the executive
We implement the Total Rewards philosophy by
officers. HR’s presentation includes an analysis prepared
employing broad-based programs that are designed to
in support of the recommendations. The analysis
align employee interests with company goals and create
includes a summary of the results of our application of
a common vision of success.
our ‘‘Executive Compensation Framework’’ to each of
Compensation Objectives. Our compensation program our executive officers. Our ‘‘Executive Compensation
and policies serve the following objectives: Framework’’ includes a variety of internal and external
factors, and is described in greater detail below. The
• Reward employees for creating shareholder value
internal factors are generally applied and analyzed by
and for achieving key strategic objectives;
HR. HR has engaged a third-party compensation
• Align long-term employee and shareholder consultant, Towers Perrin, a global professional services
interests; firm, to assist in the development of compensation data
that is used to facilitate the application and analysis of
• Motivate employees to achieve short-term
the external factors. The Compensation Committee
financial, operational, customer and employee
reviews the recommendations with The Delves Group,
outcomes that materially contribute to the
an independent compensation consulting firm retained
sustainable, long-term health of Best Buy;
by the Compensation Committee, and discusses them
• Attract talent necessary to develop new with HR. The Compensation Committee’s review is
capabilities and enhance existing competencies; comprehensive and considers factors such as: (i) the
and alignment of the proposed compensation with our Total
• Maintain a flexible compensation structure that Rewards philosophy; (ii) the alignment of the proposed
allows employees to share in our success. compensation with our compensation objectives; (iii) the
overall value of the compensation package, relative to
How We Determine Compensation. The Compensation internal factors and external benchmarks; and (iv) our
Committee is responsible for determining and approving decision not to offer supplemental compensation,
executive compensation. In addition, the Compensation benefits, perquisites and protections commonly extended
Committee oversees the development, evaluation and to executive officers of other large companies. The
approval of incentive compensation, equity-based pay process for evaluating the named executive officers’
and other employee benefit plans for all employees, compensation packages based on internal factors,
including our named executive officers. The external benchmarks and the lack of supplemental
Compensation Committee is authorized to delegate to compensation is described in greater detail below.
management certain responsibilities regarding our
employee compensation and benefit plans, as specified Executive Compensation Framework. For fiscal 2009,
in the Compensation Committee’s charter, which is each element of compensation and the level of total
posted on our Web site at www.BestBuy.com — select direct compensation for our named executive officers
the ‘‘For Our Investors’’ link and then the ‘‘Corporate (other than pursuant to our Voluntary Separation
Governance’’ link. Program) was determined by referring to our Executive
Compensation Framework to each individual. Our
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