Freddie Mac 2011 Annual Report Download - page 347

Table 84 — Named Executive Officer Individual Performance Summaries
Individual Performance Measures Assessment of Performance
Mr. Haldeman:
• Lead the execution of objectives included in the corporate
scorecard;
• Assist the Conservator’s consideration of alternatives for the
future of the U.S. housing and mortgage markets;
• Strengthen critical talent management processes, including
development of the senior leadership team and completion of
initiatives designed to increase employee engagement; and,
• Foster a risk management culture throughout the company,
including providing visible support for risk management
During 2011, Mr. Haldeman continued to build strong and collaborative relationships, both within the company and with our
Conservator. His leadership style has supported achievement of our business objectives as well as our Conservator’s efforts to
assess alternative future structures for the housing finance system. Under Mr. Haldeman’s leadership during 2011, the company
achieved most, but not all, of the corporate scorecard objectives. The company strengthened the talent management process by
initiating a best-in-class leadership development program for all mid- and senior-level leaders, focusing the company on developing
stronger leaders at multiple levels. Mr. Haldeman has continued to strengthen the risk management function by supporting a
strategy to elevate the risk management processes and by fostering a risk-aware culture where every employee is a risk manager.
Mr. Kari:
• Maintain effective internal controls over financial reporting
and complete the remediation of five separate significant
deficiencies;
• Improve the readability and quality of public disclosures and
earnings releases;
• Complete all finance-related business infrastructure
deliverables included in the 2011 corporate scorecard;
• Identify and implement process improvements to make
company processes more efficient and manage administrative
expenses to achieve G&A expense targets; and,
• Improve engagement of finance division employees, with a
specific focus on the division’s leadership team.
Mr. Kari was a stabilizing leadership presence for employees in his division as well as his fellow Management Committee
members during what was an especially challenging year at the company. He displays an openness for tackling difficult issues and
consistently strives to improve support and partnership with the business units. Under his leadership during 2011, business results
for the finance organization were above plan and included enhancements to the readability and quality of the company’s financial
disclosures, and completing all of the finance-related business infrastructure deliverables not dependent on projects cancelled or
delayed as part of implementing the new technology governance model. He also implemented improvements to internal processes,
and eliminated redundancies that reduced expenses. Accounting efficiency continues to improve and the close and reporting
processes have been streamlined. He demonstrated leadership capabilities by fostering an environment that values teamwork and
collaboration over individual accomplishment and by implementing initiatives designed to improve employee engagement. While
certain controls over financial reporting were strengthened during the year as a result of the remediation of several significant
deficiencies, the company identified one new material weakness as of December 31, 2011.
Mr. Renzi:
Mr. Renzi was promoted to lead the single-family business,
operations and technology functions in April 2011. Accordingly,
individual performance objectives for his new role were not
established for him prior to the beginning of the year. In addition to
his ongoing responsibilities associated with the sourcing and
servicing of our single-family loan portfolio and management of
our information technology operations and infrastructure, his areas
of focus during 2011 included:
• Making organizational changes to enable us to become an
industry-leading operation;
• Transforming our information technology organization,
including implementing a process to more effectively
manage maintenance of and enhancements to our technology
infrastructure;
• Improving servicer performance management and loss
mitigation activities;
• Effectively utilizing foreclosure alternatives to minimize
losses on delinquent mortgages;
• Reducing REO vendor concentration risk; and
• Establishing a clear operating business plan that guides the
business over the course of the next one to three years.
Mr. Renzi assumed a broadened role beginning in April 2011, which included being responsible for the single-family business,
operations and technology organization. He assumed this role just as the FHFA-directed Servicing Alignment Initiative began. His
leadership skill, mortgage finance industry expertise and focus on execution enabled him to drive the implementation of the policy
and process changes related to that FHFA initiative. He has established a positive and motivating leadership presence within his
new organization that has facilitated significant progress in the company’s production sourcing and loss mitigation efforts. Upon
assuming his current role, Mr. Renzi also identified critical changes needed to better support our mission. This led to, among other
things, a reorganization of our largest division that has resulted in the realignment of groups previously spread across multiple
organizations to improve business execution, better meet the needs of our customers and establish a clear operating business plan
to help guide our business through the next 12 to 36 months. Under Mr. Renzi’s leadership, a new servicing scorecard was
developed to monitor servicer performance and a new framework for managing servicer performance was developed and
implemented, both of which were instrumental in developing the Servicing Alignment Initiative. He also led the development of a
new technology governance model, under which information technology was centralized and a new structure was established to
identify, prioritize and develop critical information technology solutions to meet evolving business needs. He worked to reduce
vendor concentration risk by adding two new REO sales vendors to improve marketing efforts, enhance pricing precision, reduce
inventory cycle times and, in turn, loss severity levels.
Mr. Weiss:
• Develop a cohesive and efficient Chief Administrative
Officer team that serves as a resource to both internal and
external stakeholders on a variety of operational and policy
issues;
• Integrate the Models division and enhance model
governance;
• Oversee servicer compliance with the provisions of the
Administration’s Home Affordable Modification Program
(HAMP);
• Make human resources processes more efficient and reduce
costs where appropriate;
• Enhance talent development by launching a leadership
development program for mid- and senior-level leaders; and
• Serve as a key liaison to FHFA.
Mr. Weiss’s knowledge of the company, leadership skills and ability to manage multiple business initiatives led to a further
increase in the scope of his responsibilities in 2011. He added the financial modeling organization to the other functions he leads,
which now include MHA-C; human resources; external relations; government and industry relations; and corporate strategy and
mission. Under his leadership during 2011, the strategy, public policy, government relations and communications teams worked
together effectively to provide expertise, information and data to management, the Board and other parties on a variety of policy
and procedural issues. Under Mr. Weiss’ leadership, model governance, development, documentation, performance monitoring and
prioritization have become more robust. He also successfully led the team responsible for overseeing servicers’ compliance with
the requirements of HAMP, as a financial agent of the U.S. Treasury. With respect to human resources matters, the company
achieved significant business results, including implementing major changes to our employee benefits programs that will
significantly reduce the future cost of those programs while still providing market-competitive benefits to employees, accelerating
the compensation planning process to create efficiencies, and establishing a leadership development program for all mid- and
senior-level leaders. Throughout the year, Mr. Weiss successfully guided the company’s relationship with FHFA during a very
challenging period. He served as both a liaison on a variety of sensitive matters that pertain to our unique current operating
environment and a reliable resource on GSE policy and future state issues.
Ms. Wisdom:
• Strengthen the company’s risk management capabilities;
• Lead the rebuilding of the corporate model oversight process
and related model governance capabilities;
• Implement an enhanced new business initiative process; and,
• Improve engagement of enterprise risk management division
employees, with a specific focus on the division’s leadership
team.
During 2011, Ms. Wisdom successfully led the enterprise risk function during a period of great change and has taken steps to
significantly strengthen the function. She provides strong leadership and has proven capable at driving change across the
organization while establishing collaborative relationships with key stakeholders. During 2011, she strengthened our risk
management governance by simplifying and streamlining oversight and decision-making. As part of this effort, she integrated the
credit risk management function into the enterprise risk management organization, establishing a unified risk management
function. As a result, alignment with business units across the company was substantially improved, and the company’s credit risk
oversight was strengthened. Ms. Wisdom also successfully led an effort to rebuild the corporate model process and related
governance, a cross-divisional effort involving stakeholders throughout the company. She redesigned and implemented a new
governance structure associated with the execution of corporate new business initiatives that engages executive management earlier
in the process, provides consistent communication, delivers comprehensive enterprise-wide risk assessments, and provides
increased transparency. From an employee engagement perspective, she has provided numerous leadership and skills development
opportunities for all levels of staff in her division and has increased her visibility — and thus the visibility of the risk management
function — both internally and externally.
Written Agreements Relating to Employment of CEO and CFO
We have entered into: (a) a Memorandum Agreement; and (b) a recapture agreement with each of Messrs. Haldeman
and Kari in connection with their employment as our executive officers. Copies of the Memorandum Agreement and the
recapture agreement regarding Messrs. Haldeman and Kari were filed as Exhibits 10.1 and 10.2, respectively, to our
Current Reports on Form 8-K filed on July 21 and September 24, 2009 with respect to each executive’s employment with
us.
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