Starwood 2010 Annual Report Download - page 31

Download and view the complete annual report

Please find page 31 of the 2010 Starwood annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 170

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111
  • 112
  • 113
  • 114
  • 115
  • 116
  • 117
  • 118
  • 119
  • 120
  • 121
  • 122
  • 123
  • 124
  • 125
  • 126
  • 127
  • 128
  • 129
  • 130
  • 131
  • 132
  • 133
  • 134
  • 135
  • 136
  • 137
  • 138
  • 139
  • 140
  • 141
  • 142
  • 143
  • 144
  • 145
  • 146
  • 147
  • 148
  • 149
  • 150
  • 151
  • 152
  • 153
  • 154
  • 155
  • 156
  • 157
  • 158
  • 159
  • 160
  • 161
  • 162
  • 163
  • 164
  • 165
  • 166
  • 167
  • 168
  • 169
  • 170

General Counsel and Corporate Secretary of IMS Health Incorporated, an information services company, and its
predecessors from February 1997 to December 1999. Prior to that time, Mr. Siegel was a Partner in the law firm of
Baker & Botts, LLP. Mr. Siegel is also a Trustee of Cancer Hope Network, a non-profit entity, a Trustee of Minority
Corporate Counsel Association, and a Trustee of the American Hotel & Lodging Educational Foundation.
Simon M. Turner. Mr. Turner, 49, has been President, Global Development since May 2008. From June
1996 to April 2008, he was a principal of Hotel Capital Advisers, Inc., a hotel investment advisory firm. During this
period, Mr. Turner served on the board of directors of Four Season Hotels, Inc., serving as a member of the Human
Resources Committee and the Audit Committee. He was also a member of the board of directors of Fairmont
Raffles Hotels International and was chairman of the Audit Committee. From July 1987 to May 1996, Mr. Turner
was a member of the Investment Banking Department of Salomon Brothers, based in both New York and London.
II. COMPENSATION DISCUSSION AND ANALYSIS
Introduction
The Company’s compensation programs are designed to align compensation with its business objectives and
performance, enabling the Company to attract, retain, and reward executive officers and other key employees who
contribute to the Company’s long-term success and motivate executive officers and key employees to enhance long-
term stockholder value. The Compensation Committee reviews and sets the Company’s overall compensation
strategy for all employees on an annual basis. In the course of this review, the Compensation Committee considers
the Company’s current compensation programs and whether to modify them or introduce new programs or elements
of compensation in order to better meet the Company’s overall compensation objectives. We provide information
below with regard to the specific compensation of our Chief Executive Officer, Chief Financial Officer and our
three other most highly compensated executive officers, as determined for 2010 (our “Named Executive Officers”).
A. Overview of Starwood’s Executive Compensation Program
1. Program Objectives and Other Considerations
Objectives. As a consumer lifestyle company with a branded hotel portfolio at its core, the Company
operates in a competitive, dynamic and challenging business environment. In step with this mission and environ-
ment, the Company’s compensation program for our principal executive officer, principal financial officer and other
executive officers has the following key objectives:
•Attract and Retain: We seek to attract and retain talented executives from within and outside the
hospitality industry who understand the importance of innovation, brand enhancement and consumer
experience. We are working to reinvent the hospitality industry, and one element of this endeavor is to bring
in key talent from other industries. Therefore, overall program competitiveness must take these other
markets into account.
•Motivate: We seek to motivate our executives to sustain high performance and achieve Company financial
and strategic/operational goals over the course of business cycles and in various market conditions.
•Align Interests: We endeavor to align the interests of stockholders and our executives by tying executive
compensation to the Company’s business results and stock performance. Moreover, we strive to keep the
executive compensation program transparent, easily understood, in line with market practices and consistent
with high standards of good corporate governance.
In its review of the overall compensation strategy and program in 2008, the Compensation Committee made
several key changes, most of which became effective for the 2009 performance year and have carried forward for
2010. The Compensation Committee changed its philosophy on tax gross-ups in change in control agreements and
eliminated gross-ups for arrangements put in place in 2008 and thereafter. The Compensation Committee also
revised the structure of determining annual incentive compensation under the Company’s Executive Plan: with
respect to the goal based upon the Company’s financial performance, the Compensation Committee eliminated a
floor below which compensation could not fall; and with respect to bonus pool funding, the Compensation
Committee made structural changes to fund the pool entirely based upon the Company’s financial performance
19