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VZ » Topics » Linkage between Pay and Performance

This excerpt taken from the VZ DEFA14A filed Apr 7, 2009.

Linkage between Pay and Performance

Verizon’s executive compensation is directly linked to the Company’s performance. Verizon’s compensation programs are designed so that total compensation is heavily weighted toward incentive pay using a mix of performance measures that discourages executives from taking undue risks to achieve short-term goals at the expense of the Company’s long-term sustainability. Only approximately 10% of Verizon’s senior executives’ total compensation opportunity is made up of base salary. Approximately

 

 

* Revenue and EPS data are derived on the same basis used to establish Verizon’s performance targets, which include non-GAAP adjustments. For 2008, (i) consolidated adjusted total revenue differs from consolidated total revenue due to reclassifications made to reported revenues to reflect comparable operating results for the spin-off of the wireline segment’s non-strategic local exchange and related business assets in Maine, New Hampshire and Vermont, and (ii) adjusted EPS excludes merger integration costs, access line spin-off related charges, investment-related charges and severance, pension and benefit charges.

90% of their total compensation opportunity is made up of incentive pay with approximately:

 

  •  

70% based on three-year total shareholder return in order to evaluate long-term strategies and the effect on value for shareholders; and

 

  •  

20% based on achievement of challenging annual performance metrics.

Verizon had strong operational and financial performance in 2008. However, the Committee approved payouts under the Short-Term Incentive Plan at 5% below their targeted value. Verizon’s Long-Term Incentive Plan is based on performance over a three-year period. For the three-year period from 2006-2008, Verizon’s total shareholder return ranked above the 60th percentile when compared to its market benchmarks. As a result, the Committee approved award payouts for the 2006-2008 long-term award cycle at 23% above the targeted grant levels.

This excerpt taken from the VZ DEFA14A filed Mar 30, 2009.

Linkage between Pay and Performance

Verizon’s executive compensation is directly linked to the Company’s performance. Verizon’s compensation programs are designed so that total compensation is heavily weighted toward incentive pay using a mix of performance measures that discourages executives from taking undue risks to achieve short-term goals at the expense of the Company’s long-term sustainability. Only 10% of Verizon’s senior

 

 

* Revenue and EPS data are derived on the same basis used to establish Verizon’s performance targets, which include non-GAAP adjustments. For 2008, (i) consolidated adjusted total revenue differs from consolidated total revenue due to reclassifications made to reported revenues to reflect comparable operating results for the spin-off of the wireline segment’s non-strategic local exchange and related business assets in Maine, New Hampshire and Vermont, and (ii) adjusted EPS excludes merger integration costs, access line spin-off related charges, investment-related charges and severance, pension and benefit charges.

LOGO   3   March 30, 2009

 

executives’ total compensation opportunity is made up of base salary. Approximately 90% of their total compensation opportunity is made up of incentive pay with approximately:

 

  •  

70% based on three-year total shareholder return in order to evaluate long-term strategies and the effect on value for shareholders; and

 

  •  

20% based on achievement of challenging annual performance metrics.

Verizon had strong operational and financial performance in 2008. However, the Committee approved payouts under the Short-Term Incentive Plan at 5% below their targeted value. Verizon’s Long-Term Incentive Plan is based on performance over a three-year period. For the three-year period from 2006-2008, Verizon’s total shareholder return ranked above the 60th percentile when compared to its market benchmarks. As a result, the Committee approved award payouts for the 2006-2008 long-term award cycle at 23% above the targeted grant levels.

EXCERPTS ON THIS PAGE:

DEFA14A
Apr 7, 2009
DEFA14A
Mar 30, 2009

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