Western Union 2013 Annual Report Download - page 51

33 | The Western Union Company – Proxy Statement
NOTICE OF 2014 ANNUAL MEETING OF STOCKHOLDERS AND PROXY STATEMENT
Compensation Discussion and Analysis PROXY STATEMENT
Executive Compensation Framework
The Compensation Committee reviews on an ongoing basis the Company’s executive compensation and benefits programs
to evaluate whether they support the Company’s compensation philosophy and objectives, as described in “-Establishing and
Evaluating Executive Compensation-Our Executive Compensation Philosophy and Objectives” below, and serve the interests
of our stockholders. The Company’s practices include the following, each of which reinforces our executive compensation
philosophy and objectives:
What We Do:
 Pay-for-performance. A significant percentage of targeted annual compensation is delivered in the form of
variable compensation that is connected to actual performance. For 2013, variable compensation comprised
approximately 88% of the targeted annual compensation for the Chief Executive Officer and, on average, 78% of
the targeted annual compensation for the other named executive officers.
 Linkage between performance measures and strategic objectives. Performance measures for incentive
compensation are linked to both strategic and operating objectives designed to create long-term stockholder value
and to hold executives accountable for their individual performance and the performance of the Company.
 Emphasis on future pay opportunity vs. current pay. In 2013, all of the long-term incentive awards delivered
to our named executive officers were in the form of equity-based compensation and the Annual Incentive Plan
included a restricted stock unit component to be delivered if the Company achieved 2013 strategic objectives.
 Outside compensation consultant. The Compensation Committee retains its own compensation consultant to
review the Company’s executive compensation program and practices.
 “Double trigger” in the event of a change-in-control. In the event of a change-in-control, severance benefits
are payable only upon a “double trigger.”
 Maximum payout caps for annual cash incentive compensation and performance-based restricted stock
unit awards.
 “Clawback” Policy. The Company may recover incentive compensation paid to an executive officer that was
calculated based upon any financial result or performance metric impacted by fraud or misconduct of the executive
officer.
 Robust stock ownership guidelines. Executives are required to hold stock equal to a multiple of five times salary
for our Chief Executive Officer and two times salary for each other named executive officer. Fifty percent of after-tax
shares received as equity compensation must be retained until an executive meets the stock ownership guideline.
What We Don’t Do:
 No change-in-control tax gross ups. We do not provide change-in-control tax gross ups to individuals promoted
or hired as executive officers after April 2009.
 No repricing or buyout of underwater stock options. None of our equity plans permit the repricing or buyout
of underwater stock options or stock appreciation rights, except in connection with certain corporate transactions
involving the Company.
 Prohibition against employee and director pledging and hedging of Company securities.
 No dividends or dividend equivalents accrued or paid on performance-based restricted stock
unit awards or time-based restricted stock unit awards.