Big Lots 2011 Annual Report Download - page 44

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- 30 -
The following graph illustrates the total at-risk incentive compensation for each of our named executive
officers as a percentage of the total executive compensation awarded for fiscal 2011:
Percentage of At-Risk Incentive Compensation
89.2% 81.4% 81.3% 83.5% 77.8% 85.7%
0.0%
10.0%
20.0%
30.0%
40.0%
50.0%
60.0%
70.0%
80.0%
90.0%
100.0%
Mr. Fishman Mr. Cooper Ms. Bachmann Mr. Haubiel Mr. Martin Average
As reflected in the above graph, a significant portion of total executive compensation awarded to our
named executive officers is at-risk incentive compensation which we believe exemplifies the emphasis
of our executive compensation program on “pay for performance.” In rewarding performance through
at-risk incentive compensation, we believe we align the interests of our executives with those of
our shareholders.
• Manage executive compensation costs.
As we discuss in greater detail in the “Comparative Compensation Data” section of this CD&A, we
compare the compensation paid to our executives with the compensation paid to similarly-situated
executives at companies within our peer groups. While this comparison is not a determinative factor for
setting compensation for our executives, we believe our review of the peer group data provides a market
check and supports our belief that we do not overpay our executives and we effectively manage our
executive compensation costs.
• Focus on corporate governance.
Although the compensation committees of some companies make all compensation decisions with
respect to their executives, we believe it is consistent with best practices in corporate governance to
reach a consensus among all outside directors when establishing executive compensation each year.
While the Committee takes the lead in formulating executive compensation, we seek the approval of
our five additional outside directors before finalizing annual executive compensation to provide an
additional check on the appropriateness of the amounts awarded.
Elements of In-Service Executive Compensation
The primary compensation elements for our named executive officers consist of salary, bonus opportunities under
the 2006 Bonus Plan and equity awards made under the 2005 LTIP. In addition, our named executive officers are
entitled to certain personal benefits and perquisites. We believe each of these elements and the mix of elements are
necessary to provide a competitive executive compensation program and, as discussed above in “Philosophy and
Objectives of our Executive Compensation Program” section of this CD&A, is consistent with our compensation
philosophy and furthers our compensation objectives.