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VRSN » Topics » Benchmarking

This excerpt taken from the VRSN DEF 14A filed Jul 27, 2007.

Benchmarking

VeriSign uses a benchmarking process to help determine base salary, annual incentive bonus and long-term incentive compensation targets for our executive officers. The Compensation Committee engages a third party executive compensation consulting firm to undertake an annual study of competitive compensation practices for executive officers at certain high technology companies that we view as our peers or as competitors for talent. The Compensation Committee regularly reviews VeriSign’s financial performance against these peers to assess the degree to which executive performance aligns with the metrics set by our peers.

The Compensation Committee targets total cash compensation (base salary and annual incentive bonus) between the 50th and 75th percentile of the compensation peer group. Long-term incentive compensation is targeted at the 75th percentile of the compensation peer group. Total direct compensation (base salary plus annual incentive bonus plus long-term incentive compensation) is targeted at the 75th percentile of the compensation peer group. Adjustments to total compensation are made based on the executive’s individual performance in the prior year relative to his peers, the executive’s future potential with the Company, and the scope of the executive’s responsibilities and experience. The Compensation Committee believes that setting base salary, bonus and long-term incentive compensation targets at these levels is necessary in order to effectively attract, retain and motivate talented executives while enabling the Company to differentiate between executives, levels of performance and responsibility.

Other elements of compensation, including health and welfare benefits, perquisites, and severance and change-in-control payments and benefits are reviewed periodically by the Compensation Committee to ensure that our total compensation is competitive based on data obtained from various sources at the time of the review.

VeriSign’s compensation peer group is principally made up of publicly-traded companies in the high technology sector that are our direct business competitors and with which we compete for executive talent.

 

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The compensation peer group is comparable to VeriSign with regard to labor market competition, market capitalization, revenue and number of employees. The compensation peer group is reviewed annually and adjustments are made as necessary to ensure the group continues to appropriately reflect the competitive market for key talent and includes companies similar to VeriSign in scope and complexity.

For 2006, the compensation peer group consisted of the following companies:

 

Adobe Systems Inc.

    Hyperion Solutions Corp.

Akamai Technologies Inc

   

Intuit Inc.

Autodesk

    Juniper Networks Inc.

BEA Systems Inc.

    McAfee, Inc.

Cadence Design Systems Inc.

    Mercury Interactive Corp.

Citrix Systems Inc.

    Network Appliance Inc.

Convergys Corporation

    Symantec Corp.

Electronic Arts Inc.

   

On May 1, 2007, the Compensation Committee determined that the compensation peer group for 2007 and 2008 would consist of the following companies:

 

Adobe Systems Inc.   Convergys Corporation
Akamai Technologies Inc   Electronic Arts Inc.
Autodesk   Intuit Inc.
BEA Systems Inc.   Juniper Networks Inc.
BMC Software, Inc.   McAfee, Inc.
Business Objects S.A.   Network Appliance Inc.
Cadence Design Systems Inc.   Symantec Corp.
Citrix Systems Inc.  

The Compensation Committee also reviews annually the executive pay practices of other similarly situated companies as reported in industry surveys, reports from compensation consulting firms and other public data. These surveys are specific to the high technology sector and the Company utilizes customized reports of these surveys so that the compensation data reflect the practices of companies that are as similar in scope and complexity to VeriSign as possible. This information is also considered when making recommendations for each compensation element.

This excerpt taken from the VRSN 10-K filed Jul 12, 2007.

Benchmarking

 

VeriSign uses a benchmarking process to help determine base salary, annual incentive bonus and long-term incentive compensation targets for our executive officers. The Compensation Committee engages a third party executive compensation consulting firm to undertake an annual study of competitive compensation practices for executive officers at certain high technology companies that we view as our peers or as competitors for talent. The Compensation Committee regularly reviews VeriSign’s financial performance against these peers to assess the degree to which executive performance aligns with the metrics set by our peers.

 

The Compensation Committee targets total cash compensation (base salary and annual incentive bonus) between the 50th and 75th percentile of the compensation peer group. Long-term incentive compensation is targeted at the 75th percentile of the compensation peer group. Total direct compensation (base salary plus annual incentive bonus plus long-term incentive compensation) is targeted at the 75th percentile of the compensation peer group. Adjustments to total compensation are made based on the executive’s individual performance in the prior year relative to his peers, the executive’s future potential with the Company, and the scope of the executive’s responsibilities and experience. The Compensation Committee believes that setting base salary, bonus and long-term incentive compensation targets at these levels is necessary in order to effectively attract, retain and motivate talented executives while enabling the Company to differentiate between executives, levels of performance and responsibility.

 

Other elements of compensation, including health and welfare benefits, perquisites, and severance and change-in-control payments and benefits are reviewed periodically by the Compensation Committee to ensure that our total compensation is competitive based on data obtained from various sources at the time of the review.

 

VeriSign’s compensation peer group is principally made up of publicly-traded companies in the high technology sector that are our direct business competitors and with which we compete for executive talent.

 

The compensation peer group is comparable to VeriSign with regard to labor market competition, market capitalization, revenue and number of employees. The compensation peer group is reviewed annually and adjustments are made as necessary to ensure the group continues to appropriately reflect the competitive market for key talent and includes companies similar to VeriSign in scope and complexity.

1

Non-GAAP financial information does not include the following types of financial measures that are included in GAAP: amortization of purchased intangible assets, in-process research and development, stock-based compensation expense, litigation settlements, gain/loss from the Jamba joint venture, restructuring, impairment of assets and acquisition-related reserve costs, impairment charges for goodwill and purchased intangible assets, internal review costs, release of deferred tax asset valuation allowances, and the net gain/loss or impairment of investments.

 

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For 2006, the compensation peer group consisted of the following companies:

 

Adobe Systems Inc.    Hyperion Solutions Corp.
Akamai Technologies Inc    Intuit Inc.
Autodesk    Juniper Networks Inc.
BEA Systems Inc.    McAfee, Inc.
Cadence Design Systems Inc.    Mercury Interactive Corp.
Citrix Systems Inc.    Network Appliance Inc.
Convergys Corporation    Symantec Corp.
Electronic Arts Inc.   

 

On May 1, 2007, the Compensation Committee determined that the compensation peer group for 2007 and 2008 would consist of the following companies:

 

Adobe Systems Inc.    Convergys Corporation
Akamai Technologies Inc    Electronic Arts Inc.
Autodesk    Intuit Inc.
BEA Systems Inc.    Juniper Networks Inc.
BMC Software, Inc.    McAfee, Inc.
Business Objects S.A.    Network Appliance Inc.
Cadence Design Systems Inc.    Symantec Corp.
Citrix Systems Inc.   

 

The Compensation Committee also reviews annually the executive pay practices of other similarly situated companies as reported in industry surveys, reports from compensation consulting firms and other public data. These surveys are specific to the high technology sector and the Company utilizes customized reports of these surveys so that the compensation data reflect the practices of companies that are as similar in scope and complexity to VeriSign as possible. This information is also considered when making recommendations for each compensation element.

 

EXCERPTS ON THIS PAGE:

DEF 14A
Jul 27, 2007
10-K
Jul 12, 2007

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