This excerpt taken from the HPQ DEF 14A filed Feb 11, 2005.
Executive Compensation Practices
Each year, we survey the executive compensation practices of our technology and general industry peer groups, as well as our "blended peer" group,1 which combines our technology and general industry peers. Our practice is to target our Total Rewards program for executive compensation at approximately the median percentile of total rewards provided by our blended peer group. Based upon review of the compensation arrangements discussed below, blended peer group compensation levels and our assessments of individual and corporate performance, we believe that the value and design of our executive compensation program is appropriate.