Ingram Micro 2002 Annual Report Download - page 23

EXECUTIVE COMPENSATION
Report of the Human Resources Committee
The following Report of the Human Resources Committee and the performance graphs included elsewhere in this proxy statement do
not constitute soliciting material and should not be deemed filed or incorporated by reference into any other Ingram Micro filing under
the Securities Act of 1933 or the Securities Exchange Act of 1934, except to the extent Ingram Micro specifically incorporates this
Report or the stock performance graph by reference therein.
The Human Resources Committee of the Board of Directors has furnished the following report on executive compensation for fiscal
2001.
What is our philosophy of executive officer compensation?
Our compensation program for executives consists of the following key elements:
• base salary,
• performance-based annual bonus,
• periodic grants of equity-based awards, and
• beginning in 2002, cash-based long-term incentive awards.
We believe that this multi-component approach best serves the interest of our company and our shareowners. It enables us to meet the
requirements of the highly competitive environment in which we operate while ensuring that executive officers are compensated in a
way that advances both short- and long-term interests of shareowners.
We ensure that a high proportion of our executive officers’ current compensation is “at risk” through a performance-based annual
bonus tied to achievement of financial objectives by our company. Periodic equity-based awards further allow us to place a significant
portion of our executives’ long-term compensation “at risk” by relating it to stock price appreciation realized by all of our shareowners.
In addition, we have recently issued grants of cash-based long-term incentive awards keyed to satisfaction of pre-established
performance goals as an additional element of our compensation program, subject to approval of the Ingram Micro Inc. Executive
Incentive Plan at the 2002 Annual Meeting of Shareowners.
Subject to the needs of our company, we generally attempt to design all incentive and equity-based programs to be deductible under
the Internal Revenue Code of 1986, as amended.
We retained Hewitt Associates LLC to conduct a competitive compensation study.
We engaged Hewitt Associates LLC, an internationally recognized executive consulting firm, to conduct a total compensation
measurement study to reassess the competitiveness of our compensation programs (base pay, annual incentives and long-term incentives)
for our global executive management team for fiscal 2001. In doing so, the value of each of our pay elements was compared to
information available from Hewitt’s databases for a selected group of companies from the high tech/electronics, wholesale/distribution,
catalog/freight industries that we believe are our competitors in recruiting the best executives and who provide outstanding performance
in shareowner return. Based on the results of the Hewitt study, we implemented new base pay ranges and long-term incentive award
guidelines for each member of our global executive management team in December 2000 for fiscal 2001.
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