Symantec 2015 Annual Report Download - page 43

(1) Consistent with the presentation in our quarterly earnings releases and supplemental materials, under our
executive compensation programs, we define (i) non-GAAP operating income as gross profit less operating
expenses before interest and taxes, adjusted to exclude stock-based compensation expense, charges related to
the amortization of intangible assets, certain other income and expense items that management considers
unrelated to the Company’s core operations, and the associated income tax effects of the adjustments;
(ii) non-GAAP revenue as adjusted to exclude EDS & NDI settlement; and (iii) non-GAAP EPS as diluted
net income per share as adjusted to exclude the items described above, as well as non-cash interest expense,
value-added tax refunds a tax from the China tax bureau, certain other tax benefits, and the related tax impact
of these adjustments.
For purposes of calculating achievement of these metrics, consistent with the presentation of non-GAAP
operating income in our quarterly supplemental materials, foreign exchange movements were held constant
at plan rates, pursuant to the terms of the plans.
NEO Compensation
Our named executive officers were compensated in a manner consistent with our core pay-for-performance
compensation philosophy. The following are some important elements of our named executive officers’ compen-
sation for fiscal 2015:
‰Majority of pay mix at risk. For fiscal 2015, approximately 94% of our CEO’s target total direct
compensation was at risk and approximately 88% of the target total direct compensation for our other
named executive officers, on average, was at risk.
‰Short-term incentive compensation linked directly to Company financial results. Our executive
annual incentive compensation was structured to emphasize performance. Under the FY15 Executive
Annual Incentive Plans, the named executive officers were eligible to receive performance-based
incentive cash awards based on our company’s achievement of targeted non-GAAP operating income for
fiscal 2015 and targeted non-GAAP revenue during fiscal 2015.
‰Long-term incentive compensation is 100% equity-based. For fiscal 2015, the long-term compensa-
tion component of our named executive officers’ compensation packages consisted entirely of long-term
equity incentive awards.
‰Performance measures are non-duplicative. In fiscal 2015, the cash annual incentive plan metric were
non-GAAP operating income and non-GAAP revenue, which we believe our executives have a more
direct ability to affect.
“Say on Pay” Advisory Vote on Executive Compensation and Stockholder Engagement
We hold an advisory vote on executive compensation, commonly known as “Say-on-Pay,” on an annual
basis. While these votes are not binding, we believe that it is important for our stockholders to have an oppor-
tunity to express their views regarding our executive compensation programs and philosophy as disclosed in our
proxy statement on an annual basis. The Compensation Committee values our stockholders’ opinions and the
Board and the Compensation Committee consider the outcome of each vote when making future compensation
decisions for our named executive officers. In addition to the annual advisory vote on executive compensation,
we are committed to ongoing engagement with our stockholders on executive compensation matters generally.
These engagement efforts take place through telephone calls, in-person meetings and correspondence with our
stockholders.
Although historically we have received approximately 98%, 97% and 97% of the votes cast on the advisory
vote in favor of our executive compensation (in fiscal 2011, fiscal 2012 and fiscal 2013, respectively), we
received approximately 76% of the votes cast in fiscal 2014. Based on stockholder feedback, we believe this
lower vote was due to the acceleration of all of our former CEO’s performance-contingent stock units (“PCSUs”)
upon his termination in March 2014. In consideration of the results of the most recent advisory vote and direct
input from our stockholders, the Board and the Compensation Committee no longer award PCSUs and none of
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