The DirecTV Group (DTV)

What role does the Compensation Consultant have in determining executive compensation?

        To obtain access to independent compensation data, analysis and advice, the Committee retained the services of an independent compensation consultant that is hired by and reports to the Committee. The Consultant is Watson Wyatt Worldwide. The Committee retained the Consultant in 2004 and has maintained the relationship since then. Committee members can engage or initiate contact with the Consultant and have direct access to the Consultant without management involvement. Examples of reports and projects that the Committee assigns to the Consultant can be found in the section "What information does the Committee consider when making executive compensation decisions?" on page 32. The Consultant attends meetings as appropriate at the invitation of the Committee; representatives of the Consultant attended all Committee meetings in 2008.

        The Consultant meets with Company management, including the Chief Executive Officer, from time to time, particularly when changes are contemplated to the bonus or stock incentive plans. The Consultant provides information and insight as to relevant plan design trends in general industry or among the peer group. The Consultant obtains information from Company management with regard to such matters as the Company's performance and performance of individual named executive officers, business strategy and overall compensation plan design.

34

        Although the Committee receives information and recommendations regarding the design and level of compensation of our executive officers from both the Consultant and management, the Committee makes the final decisions as to the plan design and compensation levels for the named executive officers.

        The Consultant may have other relationships with the Company, so long as those relationships do not interfere with its ability to provide independent advice. To ensure independence of the Consultant, the Committee annually reviews all other services performed by the Consultant for the Company and we minimize such other work. In 2008, we purchased compensation survey reports from Watson Wyatt Worldwide on the same basis as its other clients; fees for the survey reports totaled less than $5,000. The Consultant was also engaged to perform one consulting assignment for the Company: the Company was preparing to engage an independent human resources consulting firm in Argentina for a research project estimated to cost $20,000, when the firm was acquired by the Consultant before the project was approved and funded. After discussion with the Chairman of the Committee, the consulting project was approved. In late 2008, the Committee reviewed all activities of the Consultant for the Company, concluded that the consulting project did not interfere with the Consultant's ability to provide objective and independent advice to the Committee and confirmed the Consultant's continued independence.