Best Buy 2010 Annual Report Download - page 28

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The Compensation Committee recently adopted Principles of Executive Compensation (the ‘‘Principles’’) intended to
further assist the Compensation Committee in its review of HR’s compensation proposals. Working with The Delves
Group, HR and senior management, the Compensation Committee developed and approved the following principles
and criteria for defining and implementing each principle:
Principle Criteria
Purpose • Support the Company’s mission and vision
• Support the Company’s strategy and objectives
• Reflect the Company’s culture and values
Alignment • Ensure common financial interest with shareholders
• Ensure common financial interest throughout the company
• Provide a balance between short- and long-term objectives
Accountability • Ensure financial interests align with the employee’s area of impact
• Ensure the timing of performance periods align with the timing of the employee’s impact
• Articulate well defined metrics, goals, ranges, limits and results
• Metrics focused primarily on delivery of outcomes rather than inputs to business processes
• Maintain a consistent link between performance, rewards and consequences
Engagement • Attract and retain talent
• Create a sense of urgency
• Motivate dedication, hard work and results
• Inspire creativity and innovation
• Clearly communicate the link between pay and performance
Optimization • Promote highly differentiated positive results
• Reward exceptional performance with exceptional pay
On a going-forward basis, the Compensation evaluation of total compensation based on each
Committee plans to use the Principles as a means to individual’s personal attributes and talents, the internal
assess executive compensation programs and to provide ‘‘value’’ of their role, and objective external market
guidance to management on the Compensation data. The factors are not required to carry equal weight
Committee’s expectations for overall executive and not all of the factors are considered in determining
compensation structure. the compensation recommendation for each individual.
We believe that the diversity of the factors included in
Executive Compensation Framework. For fiscal 2010, our Executive Compensation Framework and our
each element of compensation and the level of total flexibility in their application enhances our ability to
direct compensation for each of our named executive develop compensation packages that (i) further our
officers was determined by referencing our Executive compensation objectives, (ii) further one or more of our
Compensation Framework. Our Executive Compensation strategic initiatives, and (iii) produce the highest return
Framework consists of a set of internal and external on our compensation investment.
factors that allow for a comprehensive, multi-faceted
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