Big Lots 2013 Annual Report Download - page 64

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other companies, including non-retailers, with whom we believe we also compete for talent and whose revenues
or operations are similar to ours. We believe it was prudent to consult both sets of information, because the
compensation surveys for the broader group include compensation information on more executives, including
executives who are not included in publicly-available documents. The broader comparator group also provides
a more extensive basis on which to compare the compensation of the Leadership Team members, particularly
Leadership Team members whose responsibilities, experience and other factors are not directly comparable to
those executives included in the publicly-available reports of the retailer-only group. These comparator groups vary
from year to year based on the Committee’s assessment of which companies it believes compete with us for talent
and are similar to us in terms of operations or revenues and the continued availability of compensation information
from companies previously included in either comparator group.
The Committee and our human resources department reviewed each Leadership Team member’s responsibilities
and compared, where possible, the compensation of each executive to the compensation awarded to similarly-
situated executives at comparator group companies. The Committee compared the total direct compensation levels
for our Leadership Team members to the total direct compensation of similarly situated executives within the
comparator groups. For purposes of this evaluation, no specific weight was given to one comparator group over
the other and total direct compensation was comprised of salary, annual incentive award at the targeted level and
equity awards.
While we evaluate total target direct compensation awarded to Leadership Team members against the total target
direct compensation paid by the comparator groups, this evaluation merely provides a point of reference and
market check and is not a determinative factor for setting our executives’ compensation. As discussed in this
CD&A, compensation is subjectively determined based on numerous factors. We do not benchmark or target our
compensation at any particular level in relation to the compensation of the comparator groups. We believe this
approach to the use of compensation data enables us to retain the flexibility necessary to make adjustments for
performance and experience, to attract, retain and motivate top talent, and to reward executives who we believe
excel or take on greater responsibility than executives at peer comparator companies.
Tally Sheets and Wealth Accumulation
The Committee reviewed tally sheets that set forth the total and each element of compensation awarded to each
Executive Officer for the immediately preceding two fiscal years, as well as estimated post-employment and
change in control compensation that may be payable to such executives. The tally sheets consolidate all elements
of actual and projected compensation of our executives to enable the Committee to analyze the individual elements
of compensation, the mix of compensation and the total amount of actual and projected compensation. With
this information, the Committee determined that the compensation awarded to our executives is reasonable and
consistent with our executive compensation philosophy and objectives.
The tally sheets also included an estimate of the amount of total value accumulated, and total value that will be
accumulated, by each Executive Officer through prior equity awards (assuming employment continues, awards
vest and the market price of our common shares fluctuates through the life of the awards). While the Committee
considered the accumulated total value as a factor in setting fiscal 2013 compensation, this information was not
a primary consideration. The Committee believes that the objectives of our executive compensation program
would not be adequately served if the accumulated total value of an Executive Officer’s equity awards was a
determinative factor in awarding future compensation.
Internal Pay Equity
In the process of reviewing each element of executive compensation separately and in the aggregate, the Committee
considered information comparing the relative compensation of our CEO to the other Leadership Team members.
This information was considered to ensure that our executive compensation program is internally equitable, which
we believe promotes executive retention and motivation. The comparison included all elements of compensation.
The relative difference between the compensation of our new CEO Mr. Campisi and the compensation of our
other named executive officers significantly decreased in fiscal 2013, as the compensation package awarded to
Mr. Campisi in fiscal 2013 was materially smaller than the compensation package awarded to Mr. Fishman in
fiscal 2012. The Committee believes that the disparity between Mr. Campisi’s compensation and the compensation
for the other Leadership Team members is appropriate in light of their experience, responsibilities, duties
and contributions.