Starwood 2007 Annual Report Download - page 36

terminated without cause or by him for good reason. The clarification formally documented Mr. Prabhu’s existing
severance arrangements as part of his employment by the Company as disclosed in the Company’s other filings with
the Securities & Exchange Commission.
C. Background Information on the Executive Compensation Program
1. Use of Peer Data
In determining competitive compensation levels, the Compensation Committee reviews data from several
major compensation consulting firms that reflects compensation practices for executives in comparable positions in
a peer group consisting of companies in the hotel and hospitality industries and companies with similar revenues in
other industries relevant to key talent recruitment needs. The executive team and Compensation Committee review
the peer group bi-annually to ensure it represents a relevant market perspective. The Compensation Committee
utilizes the peer group for a broad set of comparative purposes, including levels of total compensation, pay mix,
incentive plan and equity usage and other terms of employment. The Compensation Committee also reviews
Company performance against the performance of companies in this peer group. The Company believes that by
conducting the competitive analysis using a broad peer group, which includes companies outside the hospitality
industry, it is able to attract and retain talented executives from outside the hospitality industry. The Company’s
experience has proven that key executives with diversified experience prove to be major contributors to its
continued growth and success.
Accordingly, the Company was able to attract and retain:
• Frits Van Paasschen, the Company’s Chief Executive Officer, who has over 20 years of experience with
consumer-focused, global lifestyle brands, most recently serving with Coors Brewing Company, as Pres-
ident and Chief Executive Officer, and prior to that, Nike, Inc.
• Vasant M. Prabhu, the Company’s Executive Vice President and Chief Financial Officer, who prior to joining
the Company served as Executive Vice President and Chief Financial Officer of Safeway Inc., a food and
drug retailer; President of Information and Media Group for The McGraw Hill Companies, and Senior Vice
President of Finance and Chief Financial Officer for Pepsi Cola International.
• Kenneth S. Siegel, the Company’s Chief Administrative Officer, General Counsel and Secretary, who prior
to joining the Company served as Senior Vice President and General Counsel of Gartner, Inc., a provider of
research and analysis on information technology industries and was a partner in the law firms of Baker &
Botts LLP and O’Sullivan Graev & Karabell LLP.
• Matthew A. Ouimet, the Company’s President, Hotel Operations, who prior to joining the Company spent
17 years with The Walt Disney Company, most recently serving as President of the Disneyland Resort.
The peer group approved by the Compensation Committee for 2007 is set out below. We expect that it will be
necessary to update the list periodically.
American Express Co. McDonald’s Corp.
Anheuser-Busch Cos. Inc. MGM Mirage
Avon Products Nike Inc.
Carnival Corp. Nordstrom Inc.
Estee Lauder Cos. Inc. Simon Property Group Inc.
Harrah’s Entertainment Inc. Staples Inc.
Hilton Hotels Corp. Starbucks Corp.
Host Hotels & Resorts Inc. Vornado Realty Trust
Gap Inc. Williams-Sonoma Inc.
Limited Brands Inc. Wyndham Worldwide Corporation
Marriott International, Inc. Yum Brands Inc.
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