Dollar General 2014 Annual Report Download - page 37

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• In approving compensation arrangements, we take into consideration the recent
compensation history of the named executive officer, including special or unusual
compensation payments, and maintain an appropriate balance between base salary and
annual and long-term incentive compensation.
We utilize employment agreements with the named executive officers which, among other
things, set forth minimum levels of certain compensation components. We believe such arrangements
are a common protection offered to named executive officers at other companies and help to ensure
continuity and aid in retention. The employment agreements also provide for standard protections to
both the named executive officer and Dollar General should such officer’s employment terminate.
Named Executive Officer Compensation Process
Oversight. Our Board of Directors has delegated responsibility for executive compensation to
its Compensation Committee. The Compensation Committee, consisting entirely of independent
directors, approves the compensation of our named executive officers.
Use of Outside Advisors. The Compensation Committee has selected Meridian Compensation
Partners (‘‘Meridian’’) to serve as its independent compensation consultant. Meridian (or its
predecessor) has served as the Committee’s consultant since 2007. The written agreement with
Meridian details the terms and conditions under which Meridian will provide independent advice to the
Committee in connection with matters pertaining to executive and director compensation. The
Committee (or its chairman) shall determine the scope of Meridian’s services. The approved scope
generally includes availability for attendance at select Committee meetings and associated preparation
work, risk assessment assistance, assisting with the Committee’s decision making with respect to
executive and director compensation matters, providing advice on our executive pay philosophy,
compensation market comparator group and incentive plan design, providing competitive market
studies, and apprising the Committee about emerging best practices and changes in the regulatory and
corporate governance environment.
A Meridian representative attends or is on call to join such Committee meetings and private
sessions as the Committee requests. The Committee’s members are authorized to consult directly with
the consultant as desired. Meridian, along with management, prepares market comparator group data
for consideration by the Committee in making decisions on items such as base salary, the Teamshare
bonus program, and the long-term incentive program.
After evaluating all of the factors required to be considered by the NYSE listing standards, the
Committee has determined that Meridian is independent from Dollar General and that no conflicts of
interest exist related to Meridian’s services provided to the Committee.
Management’s Role. Mr. Bob Ravener, our Executive Vice President and Chief People Officer,
and non-executive members of the human resources group have assisted Meridian in gathering and
analyzing relevant competitive data and, with the input of Mr. Dreiling, identifying and evaluating
various alternatives for named executive officer compensation (including Mr. Ravener’s). The
Committee’s Chairman periodically consults directly with Messrs. Dreiling and Ravener, and other
non-executive members of our human resources group, in connection with executive compensation, and
consulted with Mr. Ravener, Ms. Rhonda M. Taylor, our Executive Vice President and General
Counsel, and other non-executive members of our human resources group, in connection with
Mr. Dreiling’s employment transition compensation. Messrs. Dreiling and Ravener discuss with the
Committee their recommendations regarding named executive officer pay components, typically based
on benchmarking data; however, Mr. Dreiling does not participate in the Committee’s deliberations of
his own compensation. For the role of management in named executive officers’ performance
evaluations, see ‘‘Use of Performance Evaluations’’ below.
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