Waste Management 2015 Annual Report Download - page 58

A DVISORY V OTE O N E XECUTIVE C OMPENSATION
(I TEM 3 ON THE P ROXY C ARD )
Pursuant to Section 14A of the Exchange Act, stockholders are entitled to an advisory (non-binding) vote on
compensation programs for our named executive officers (sometimes referred to as “say on pay”). The Board of
Directors has determined that it will include say on pay votes in the Company’s proxy materials annually until
the next stockholder vote on the frequency of the say on pay vote.
We encourage stockholders to review the Compensation Discussion and Analysis on pages 24 to 40 of this
Proxy Statement. The Company has designed its executive compensation program to be supportive of, and align
with, the strategy of the Company and the creation of stockholder value, while discouraging excessive risk-
taking. The following key structural elements and policies, discussed in more detail in the Compensation
Discussion and Analysis, further the objective of our executive compensation program and evidence our
dedication to competitive and reasonable compensation practices that are in the best interests of stockholders:
• a substantial portion of executive compensation is linked to Company performance, through annual cash
incentive performance criteria and long-term equity-based incentive awards. As a result, our executive
compensation program provides for a significant difference in total compensation in periods of above-
target Company performance as compared to periods of below-target Company performance. In 2015, our
performance-based annual cash incentive and long-term equity-based incentive awards comprised
approximately 87% of total target compensation for our President and Chief Executive Officer and
approximately 77% of total target compensation for our other named executives;
• at target, approximately 58% of total compensation of our named executives (and approximately 70% in
the case of our President and Chief Executive Officer) results from long-term equity awards, which aligns
executives’ interests with those of stockholders;
• our total direct compensation opportunities for named executive officers are targeted to fall in a range
around the competitive median;
• performance-based awards include threshold, target and maximum payouts correlating to a range of
performance goals and are based on a variety of indicators of performance, which limits risk-taking
behavior;
• performance stock units with a three-year performance period, as well as stock options that vest over a
three-year period, link executives’ interests with long-term performance and reduce incentives to
maximize performance in any one year;
• all of our named executive officers are subject to stock ownership requirements, which we believe
demonstrates a commitment to, and confidence in, the Company’s long-term prospects;
• the Company has clawback provisions in its equity award agreements and recent employment
agreements, and has adopted a clawback policy applicable to annual incentive compensation, designed to
recoup compensation when cause and/or misconduct are found;
• our executive officer severance policy implemented a limitation on the amount of benefits the Company
may provide to its executive officers under severance agreements entered into after the date of such
policy; and
• the Company has adopted a policy that prohibits it from entering into new agreements with executive
officers that provide for certain death benefits or tax gross-up payments.
The Board strongly endorses the Company’s executive compensation program and recommends that the
stockholders vote in favor of the following resolution:
RESOLVED, that the compensation of the Company’s named executive officers as described in this Proxy
Statement under “Executive Compensation,” including the Compensation Discussion and Analysis and the
tabular and narrative disclosure contained in this Proxy Statement, is hereby APPROVED.
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