Fannie Mae 2014 Annual Report Download - page 184

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Goals and Related Metrics Performance Against Goal/Metric
Goal 5: Improve the company’s capabilities, infrastructure and
efficiency.
Investment plan. Make substantial progress on the following high priority
projects in accordance with the 2014 Investment Plan as reviewed and
modified from time to time by the Strategic Initiatives Committee:
• Undertaking critical projects to change the company’s systems and
operations to integrate with the CSP; and
• Preparing our multifamily business and infrastructure for the future.
Human Capital. Develop Integrated Human Capital Plan that aligns to
key enterprise priorities and enables an inclusive culture. Deliver plan to
the Board’s Compensation Committee in July, and deliver all 2014
milestones by year-end.
Achieved this goal. Fannie Mae made significant progress in
its efforts to make required changes to its systems and
operations to integrate with the CSP. The company made
significant progress in preparing its multifamily business and
infrastructure for the future. The company also developed an
Integrated Human Capital Plan, which is an integrated
Human Resources approach that supports Fannie Mae’s
business and financial priorities from a human capital
perspective and focuses on risk mitigation, workforce and
talent planning, compensation and benefits, and employee
engagement.
Assessment of 2014 Individual Performance
Overview. For each named executive other than the Chief Executive officer, half of the executive’s 2014 at-risk deferred
salary was subject to reduction based on individual performance in 2014.
The Board of Directors assessed the Chief Executive Officer’s performance with input from the Compensation Committee
and from the Chief Executive Officer regarding his accomplishments. In approving compensation for each named executive,
the Compensation Committee and the Board considered the Chief Executive Officer’s recommendation and assessment of
each executive’s performance and contribution to the company’s achievement of the 2014 conservatorship goals and the 2014
Board of Directors’ goals. The amount of individual performance-based at-risk deferred salary for 2014 for each named
executive is presented in the table above in “Summary of 2014 Compensation Actions.”
Timothy Mayopoulos, President and Chief Executive Officer. In evaluating Mr. Mayopoulos’ performance, the Board
acknowledged Mr. Mayopoulos’ strong leadership in 2014 and his significant contributions to the company’s numerous
accomplishments. For example, the company met all of its 2014 conservatorship scorecard objectives within its control and
all of the 2014 Board of Directors’ goals in all material respects in a complicated and evolving operating environment, at a
time when management was continuing to implement major organizational changes, designing and implementing changes to
the company’s systems and operations to integrate with the common securitization platform and running the company’s
business at a high level. The company was profitable in 2014, with net income of $14.2 billion, while continuing to acquire
loans with a strong credit profile and providing access to affordable mortgage credit. The company undertook initiatives to
help prepare its business and infrastructure for changes in the U.S. housing finance system and to help ensure its safety and
soundness during conservatorship. The company also redesigned its approach to succession planning to feature an enterprise-
wide view of senior talent, enhancing management’s ability to effectively address a variety of succession issues. In addition,
in 2014 the company focused on strengthening customer relationships and improving its business efficiency, including
launching an initiative to improve the company’s front-end business capabilities to make customers’ interactions with the
company simpler and more efficient. Because Mr. Mayopoulos’ total target direct compensation consists solely of base salary,
with no additional performance-based component, the Board of Directors’ assessment of his performance in 2014 did not
affect his compensation.
David Benson, Executive Vice President and Chief Financial Officer. In recommending and determining Mr. Benson’s
individual performance-based at-risk deferred salary, the Chief Executive Officer, the Compensation Committee and the
Board of Directors considered Mr. Benson’s many achievements in 2014. As Chief Financial Officer, Mr. Benson made
significant improvements to our forecasting, stress testing and internal reporting capabilities while continuing to provide
strong intellectual contributions on our business and strategic direction to the company as a whole. Mr. Benson supported the
company’s achievement of the 2014 Board of Directors’ goals by managing the risk of the retained portfolio within risk limits
established by the Board of Directors and ensuring managed expenses remained within plan. Mr. Benson also successfully
led our efforts to meet the 2014 conservatorship scorecard objective by managing and successfully executing a plan for the
reduction of our retained portfolio. In addition, Mr. Benson provided leadership in the company’s interactions with FHFA,
Treasury and the industry.
Andrew Bon Salle, Executive Vice President-Single-Family Business. In recommending and determining Mr. Bon Salle’s
individual performance-based at-risk deferred salary, the Chief Executive Officer, the Compensation Committee and the
Board of Directors considered Mr. Bon Salle’s many achievements in 2014 as he led significant initiatives related to the
conservatorship scorecard and the 2014 Board of Directors’ Goals. Mr. Bon Salle’s accomplishments include managing the
company’s single-family business within risk limits, improving the representation and warranty framework, leading the
development and execution of credit risk transfer transactions, and developing plans for integrating Fannie Mae’s systems
with the common securitization platform and improving the company’s front-end business capabilities. Mr. Bon Salle met or
exceeded goals while successfully managing these responsibilities amidst increasing competition and risk.