First Data 2009 Annual Report Download - page 199

PART III
ITEM 11. EXECUTIVE COMPENSATION
FIRST DATA CORPORATION
COMPENSATION DISCUSSION AND ANALYSIS
FISCAL YEAR 2009
INTRODUCTION
During 2009, First Data Corporation (“FDC” or the “Company”) made significant progress in several key
areas. Service quality as measured by customer surveys and internal operational metrics was much stronger in
2009 than the previous year. Additionally, technology platform, data center and call center consolidation efforts
continued on a fast track and will continue to generate cost savings in future years. Finally, FDC made key
executive hires in Financial Services, Finance and Marketing to strengthen and add world class industry expertise
to the executive team. FDC remains committed to a compensation philosophy, strategy, and process that incents
and rewards long-term company performance. Details of the compensation philosophy and programs are
addressed within the appropriate sections of the following discussion.
Effective September 21, 2009, the Compensation and Benefits Committee was reconstituted as the
Governance, Compensation and Nominations Committee. At that time, Scott C. Nuttall, Henry R. Kravis and Joe
W. Forehand were appointed as members of the Committee, with Mr. Nuttall serving as chairperson.
Effective September 8, 2009, Patrick W. Shannon was appointed Chief Financial Officer. Phillip Wall, the
previous CFO, was appointed to be CFO at Banc of America Merchant Services, LLC (“BAMS”), a merchant
acquiring alliance formed by FDC and Bank of America during 2009. On September 21, 2009, Kevin J. Schultz
was hired as Executive Vice President of FDC’s Financial Services segment.
ROLE OF THE GOVERNANCE, COMPENSATION AND NOMINATIONS COMMITTEE
The Governance, Compensation and Nominations Committee (the “Committee”) reviews and approves all
aspects of FDC’s compensation programs for its executive officers. Specifically, under its charter, the Committee
is tasked with:
• establishing FDC’s compensation philosophy;
• evaluating performance and setting compensation for FDC’s executive officers;
• overseeing regulatory compliance with respect to compensation matters; and
• delegating to and monitoring various subcommittees with responsibility for administrative and legal
compliance for retirement and benefit plans.
Prior to September 21, 2009, the Committee and Benefits Committee was comprised of Scott C. Nuttall,
Tagar C. Olson and James R. Fisher. In connection with the reconstitution of the Committee and election of
additional members of the Board of Directors on September 21, 2009, Mr. Nuttall, Henry R. Kravis and Joe W.
Forehand were named as the Committee members. All of the foregoing individuals are affiliated with Kohlberg
Kravis Roberts & Co. L.P. and, therefore, not deemed independent directors.
ROLE OF MANAGEMENT
FDC’s management provides information, data, analysis, updates and recommendations to the Committee.
Specifically, management provides recommendations on pay levels for executive officers other than the CEO as
well as the design of all compensation and benefit plans. Finally, management is responsible for the
administration of FDC’s executive compensation programs and policies.
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