Waste Management 2015 Annual Report Download - page 30

• the Company generated a return on invested capital, for purposes of performance goals associated with
half of our performance share units (“PSUs”) granted in 2013, of 17.5%, significantly exceeding the
target of 16.0% and approaching the maximum of 17.6% for the three-year performance period ended
December 31, 2015. This performance resulted in a 196.15% payout on these PSUs in shares of Common
Stock; and
• with respect to the remaining half of the PSUs granted in 2013 with a performance period ended
December 31, 2015 that was subject to total shareholder return relative to the S&P 500, the performance
of the Company’s Common Stock on this measure exceeded the target of the 50th percentile, resulting in a
132.88% payout on these PSUs in shares of Common Stock. This performance directly benefited our
stockholders, delivering total shareholder return of 73.47% over the three-year performance period,
placing the Company in the 66th percentile.
The 2015 results continue to reinforce our emphasis on performance-based compensation, as we believe the
performance criteria underlying our incentive compensation successfully drove the results we were seeking and
correlated with total shareholder return. The MD&C Committee strives to establish performance goals that are
challenging, but attainable, and the MD&C Committee remains dedicated to the principle that executive
compensation should be substantially linked to Company performance. Accordingly, the compensation of the
Company’s executive officers set forth in the Summary Compensation Table of this Proxy Statement evidences
our commitment to pay for performance.
Consideration of Stockholder Advisory Vote
When establishing 2015 compensation for the named executives, the MD&C Committee noted the results of
the advisory stockholder votes on executive compensation in May 2014, 2013, 2012 and 2011, with 97%, 97%,
96% and 97%, respectively, of shares present and entitled to vote at the annual meeting voting in favor of the
Company’s executive compensation. The MD&C Committee has also since noted the results of the May 2015
advisory stockholder vote, with 97% of shares present and entitled to vote at the annual meeting voting in favor
of the Company’s executive compensation. Accordingly, the results of the stockholder advisory vote have not
caused the MD&C Committee to recommend any changes to our compensation practices.
2016 Compensation Program Preview
The MD&C Committee continually reviews our compensation program to ensure that it is clearly aligned
with the business strategy and best supports the accomplishment of our goals. The MD&C Committee is pleased
with the results that were delivered under the 2014 and 2015 compensation program design, which recognized
the need to improve the Company’s financial results while continuing our focus on pricing, capital allocation and
cost control. As a result, the MD&C Committee has approved keeping the 2016 annual cash and long-term
incentive compensation program design consistent with the 2014 and 2015 compensation program design, with
an adjustment only to equally weight the respective annual cash incentive performance metrics. This consistency
reinforces the MD&C Committee’s efforts to maintain a compensation program that is straightforward and easy
to communicate and understand.
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