Alignment with Stockholders and Compensation Best Practices

Pay-for-Performance Corporate Governance
  • The majority of target total direct compensation for executives is performance-based as well as equity-based to align executives’ rewards with stockholder value
  • We do not utilize executive employment contracts for senior officers
  • Total direct compensation is targeted at or near the market median
  • We devote significant time to management succession planning and leadership development efforts
  • Actual realized total direct compensation and pay positioning are designed to fluctuate with, and be commensurate with, actual annual and long-term performance recognizing company-wide, business, and individual results
  • We maintain a market-aligned severance policy for executives and a conservative change in control policy which requires a double trigger for execution
  • Incentive awards are heavily dependent upon our stock performance, and are measured against objective financial metrics that we believe link either directly or indirectly to the creation of value for our stockholders. In addition, 25% of our target annual incentives are contingent upon the achievement of qualitative objectives that we believe will contribute to our long-term success
  
  • The HRC Committee utilizes an independent compensation consultant
  • Our compensation programs are designed to mitigate compensation-related risk to the organization from both financial and reputational perspectives
  • We maintain strong stock ownership guidelines for executive officers and non-employee directors
  • We balance growth, cash flow, revenue and profit objectives, as well as short- and long-term objectives to reward for overall performance that does not over-emphasize a singular focus
  • We prohibit executive officers and directors from engaging in any form of hedging transaction, holding HP securities in margin accounts and pledging stock as collateral for loans in a manner that could create compensation-related risk for the Company
  • A significant portion of our long-term incentives are delivered in the form of performance-adjusted restricted stock units, referred to as “PARSUs,” which vest only upon the achievement of relative TSR and EPS objectives
  • We conduct a robust stockholder outreach program throughout the year
  • We validate our pay-for-performance relationship on an annual basis
  • We disclose our corporate performance goals and achievements relative to these goals