2014 Policies, Pr act ices and M er it Repor t I nclu des ... 2014... · The Digital Marketing / Marketing survey targets large Fortune 500 and multinational companies who have larger

2014 Policies, Practices and Merit ReportIncludes 2015 Merit Forecasts

July 2014

©2014 Empsight International, LLC - Confidential Page 2

Table of Contents

Overview ......................................................................................................................................................................................................................................................... 3

About Empsight ....................................................................................................................................................................................................................................................... 3 Empsight’s 2014 Compensation Surveys ................................................................................................................................................................................................................ 4

Survey Participants .......................................................................................................................................................................................................................................... 5

Competitive Pay Philosophies ....................................................................................................................................................................................................................... 10

Competitive Pay Philosophy – Base Pay ................................................................................................................................................................................................................ 10 Competitive Pay Philosophy – Total Cash Compensation ..................................................................................................................................................................................... 11 Actual Practice versus Philosophy – Base Salary ................................................................................................................................................................................................... 12 Salary Structure Design: What is the primary basis for salary structure differentiation ...................................................................................................................................... 13

Salary Structure Increase Budget for 2014 ..................................................................................................................................................................................................... 14

Merit Increase Budget 2014 .......................................................................................................................................................................................................................... 15

Merit Increase Budget for 2014 by Industry ......................................................................................................................................................................................................... 16 Merit Increase Budget for 2014 by Revenue Category ......................................................................................................................................................................................... 17 Promotional Increase Budget ................................................................................................................................................................................................................................ 18 Special Competitive Adjustment Budget .............................................................................................................................................................................................................. 19 Total Increase Budget ........................................................................................................................................................................................................................................... 20 US Salary Budget Increase Commentary ............................................................................................................................................................................................................... 21

Forecasted Salary Structure Increase Budget for 2015 ................................................................................................................................................................................... 22

Forecasted Merit Increase Budget for 2015 ................................................................................................................................................................................................... 23

Forecasted Promotional Increase Budget for 2015 .............................................................................................................................................................................................. 24 Forecasted Merit Increase Budgets for 2015 by Industry ..................................................................................................................................................................................... 25 Forecasted Merit Increase Budget for 2015 by Revenue ...................................................................................................................................................................................... 26 Forecasted Special Competitive Adjustment Budget for 2015 ............................................................................................................................................................................. 27 Forecasted Total Increase Budget for 2015 .......................................................................................................................................................................................................... 28

Short Term Incentives ................................................................................................................................................................................................................................... 29

Bonuses Paid in 2014 for 2013 Performance ........................................................................................................................................................................................................ 29

Long Term Incentive Targets.......................................................................................................................................................................................................................... 30

2014 Stock Awards Commentary .......................................................................................................................................................................................................................... 33

2015 Staffing Expectations ............................................................................................................................................................................................................................ 34

College / MBA Hire Practices ......................................................................................................................................................................................................................... 38


Overview

This report is derived from our On-line Survey of Policies, Practices and Merit conducted between April and July 2014. The analyses are based on the answers provided, in whole or in part, by 272 companies and covering the following topics:

Compensation Philosophy Analysis

Salary Structure Analysis for 2014

Merit, Promotional, and Special Competitive Adjustments Increases for 2014

Salary Structure and Merit Forecasts for 2015

Comments on Salary Modifications

Short Term Incentive Awards

Long Term Incentive Targets by Level and Department

Departmental Staffing

Analysis of Issues of Concern

Analysis of College /MBA Hiring Rates and Sign-On Bonuses

About Empsight Empsight International, LLC is a human resource consulting firm which helps employers make better decisions about their investment in people. Our primary focus is on conducting compensation surveys in niche markets, domestically and internationally. Our surveys are seen as definitive data reference sources in markets where such information is critical to maintaining competitiveness. Our clients are, predominantly, leading multinational corporations that have a high repeat participation rate in our surveys. Our Principals and staff have significant experience in consulting on compensation, organizational and human resource issues across multiple industry sectors.


Empsight’s 2014 Compensation Surveys U.S. Law Department Compensation Survey With more than 450 participating companies, Empsight's portfolio of in-house law department compensation surveys is the largest of its kind in the U.S. In 2013, the Large Company Edition included 170 Participants with an average participant revenue size in excess of $32 Billion. The Survey targets larger Fortune 500 and Multinational companies with revenues of $3 Billion and Above. The survey reports data on base salary, annual bonus, long term incentives, and multiple sub cuts. The survey also provides useful legal spending and staffing analyses. Finance & Compliance Compensation Survey The Finance & Compliance Compensation Survey incorporates and expands on Empsight’s prior Compliance, Audit & Risk Compensation Survey which has become the leading source of information of its kind and reports on large multi-billion dollar organizations. The expanded survey now includes Finance and Accounting positions to round out this collection of functions more comprehensively. Positions in all these functions have been the subject of recent significant market momentum in the largest, most complex organizations. The Survey covers key benchmark positions at the Executive, Middle Management, Professional and Support Levels in the Finance, Accounting, Compliance, Audit, Risk sub-functions. Reported compensation elements include Base Salary, Annual Incentives, and Long Term Incentives. Digital Marketing / Marketing Compensation Survey The Digital Marketing / Marketing survey targets large Fortune 500 and multinational companies who have larger marketing organizations and a business to consumer focus. The survey has a focus on newer marketing areas such as digital marketing, big data (data analytics), social media, as well as including some of the more traditional areas of marketing / communications. Government Relations & Corporate Communications Compensation Survey The Government Relations Compensation & Corporate Communications Compensation Survey is the leading source of information of its kind and reports on large multi-billion dollar organizations with larger departments, many facing challenging regulatory, legislative, or taxation environments. The report provides a comprehensive summary of cash based compensation and selected other practices for benchmark positions in these functions. Information Technology & Security Compensation Survey The Information Technology & Security Compensation reports on large multi-billion dollar organizations with larger information technology and IT security departments. The Survey covers key benchmark positions at the Executive, Middle Management, Professional and Support Levels. Benefits of the Empsight IT compensation survey include: Genuinely large company peers - no mixing of large and small participants, Contemporary, full, benchmark descriptions providing clear differentiation between levels, Coverage of new and emerging roles such as Cloud Computing, and 123 Benchmark Positions, including IT and IT Security - covering Executive, Middle Management, Professional and Support levels. Human Resources Compensation Survey - This report is free to participants in 2014 The Human Resources Compensation survey reports on Generalist and Specialist HR positions in large multi-billion dollar organizations. This report provides a comprehensive summary of compensation and selected other practices for benchmark positions in the Human Resources function. Executive Administrative Support Compensation Survey This survey covers high level executive administrative support positions in the U.S. in Fortune 500 companies and other large multi-nationals. These positions are unique in the organizational structure and the Survey provides compensation data from genuine peer type companies. The Survey covers a comprehensive array of compensation elements for these positions and will include coverage of long term compensation, where available.

http://www.empsight.com/s.nl/sc.7/category.97/.f


Survey Participants

1st Financial Bank USA

3M Company

AAA Mid-Atlantic Inc.

Abbott Laboratories

AbbVie Inc.

Accenture

Acuity Brands

Aetna, Inc

Aflac

AIG

Alliance Data

Allstate Insurance

American Airlines

American Cancer Society, Inc.

American Century Investments

AmerisourceBergen Corporation

Amica Mutual Ins Co

Anheuser-Busch InBev

Apollo Education Group, Inc.

Aramark

Argos USA Corp.

Ascena Retail Group

AstraZeneca Pharmaceuticals

AT&T

Automobile Club of Southern California

AutoNation

AutoZone

Aveda Corporation

AXA

Bank of America

Barclaycard US

Baxter

BB&T

Belk, Inc.

BG US Services, Inc.

Big Heart Pet Brands

Black & McDonald

Bloomin' Brands, Inc.

BNSF Railway Company

Booz Allen Hamilton

Boyd Gaming Corporation

BP

Broadcom

Buck Consultants

C. R. Bard, Inc.

Cablevision

Calpine Corporation

Capital One Financial

Cargill

CarMax

Carter's

Cash America International

Caterpillar

CBRE, Inc.

Centene Corporation

CenterPoint Energy

CenturyLink

CF Industries

Charles Schwab & Co., Inc.

ChevronPhillips Chemical

Chipotle Mexican Grill

CHS Inc.

Chubb

Cigna

City National Bank

Cliffs Natural Resources

Comcast Cable

ConAgra Foods, Inc.

Con-way Inc.

Coriant (Formerly Tellabs)

Crowe Horwath LLP

CST Brands, Inc.

CVS Caremark

Cypress Equities

Deere & Company

Delhaize America

Deloitte & Touche L.L.P.

Devon Energy

DIRECTV

Discover Financial Services

Dollar General Corporation

Dominion Resources, Inc.

Domtar Corporation

DST Systems, Inc.

DTE Energy

Dupont

Dynegy

eBay, Inc.

Ecolab

Eli Lilly and Company

EndoChoice, Inc.

Enterprise Products, L.P.

EP Energy

Equity Residential

Erie Insurance

Estee Lauder

Express LLC

Farmers Insurance

Federal Reserve Bank of St. Louis

FedEx Corporation

Fifth Third Bank

First National Bank of Omaha


Fiserv

Fox Networks Group

Freddie Mac

Freeport-McMoRan Inc.

GAF

Gannett Co., Inc.

Gap Inc.

GATX

General Mills, Inc.

Genpact, LLC

Genuine Parts Company

Great American Insurance

Great-West Financial

Gruma corp.

Halliburton Company

HD Vest Financial Services

Health Net

Hewlett-Packard Co.

Hilton Worldwide

Hormel Foods

Hughes Network Systems - an Echostar Company

Huntington National Bank

Huntsman

IGT

ING

Intellectual Ventures

International Paper

Iron Mountain

J.B. Hunt Transport Services, Inc.

Jackson National Life Insurance Company

JetBlue Airways

JM Family Enterprises

Johnson & Johnson

Joy Global

Kate Spade & Company

KB Home

Kimberly-Clark

Kinder Morgan

KPMG

Kroger Co.

Liberty Mutual Insurance

L'Oreal USA

LyondellBasell

Macy's, Inc.

Magellan Midstream Partners

Marriott International (on behalf of)

Marsh & McLennan Companies, Inc.

Mary Kay Inc.

MassMutual

MasterCard

Mattel, Inc.

McKesson

Merck & Co., Inc.

MetLife

Micron Technology

Minacs

Mohawk Industries, Inc.

Moody's

Mutual of Omaha

National Basketball Association

Nationwide Insurance

Navient

Neustar

New Mexico State Personnel Office

New York Life

Newell Rubbermaid

NewMarket Corporation

NewPage Corportation

NextEra Energy Resources, LLC

Nike, Inc

Nordstrom

Norfolk Southern

Novozymes North America

NuStar

Pacific Life Insurance

Patriot Coal

Penske Truck Leasing

Pepeco Holdings, Inc.

PepsiCo

Pfizer

Plains All American

PNM Resources, Inc.

Polaris

Principal Financial Group

Progressive Corporation

Publix Super Markets

PVH Corp.

PwC

QVC

Radian Group

Regal Beloit Corporation

Roundy's Supermarkets, Inc.

Royal Bank of Canada

Ryder System, Inc.

Ryerson

Sallie Mae

SAP AG

SCANA

Sears Holdings

Semiconductor Components Industries, LLC

Sentry Insurance

Simon Property Group

Sodexo

Sony Pictures Entertainment

Southern California Edison

Southern Company

SPX Corporation

Staples Inc.


Starkey Hearing Technologies

Starwood Hotels & Resorts

Steelcase Inc.

SunGard

SUPERVALU

Swiss Re

Target Corporation

Tesoro Corporation

The Allstate Corporation

The Chubb Corporation

The Clorox Company

The Coca Cola Company

The E. W. Scripps Company

The Estee Lauder Companies

The Hanover Insurance Group

The Hartford

The Hershey Company

The Home Depot

The Kroger Co.

The Manitowoc Company

The TJX Companies, Inc

The Travelers Companies, Inc.

The Walt Disney Company

Thrivent Financial

Tiffany & Co.

Time Inc.

Time Warner Cable

Time Warner Inc.

Total System Services

Toyota Motor Sales

Tribune Company

Twentieth Century Fox

Tyson Foods, inc.

U.S. Bank

Unilever United States

Union Pacific

United Rentals

United Stationers

UnitedHealth Group

Universal Health Services, Inc.

Unum Group

URS Energy & Construction

Valero

Vectren Corporation

Verizon Communications

Viacom Inc.

Visa

Vornado Realty Trust

Walgreens

Wal-Mart Stores, Inc

Washington University School of Medicine

Waste Management

We Energies

WellCare Health Plans, Inc

Wellmark Blue Cross & Blue Shield

WellPoint, INC

Whirlpool Corporation

Williams

WPX Energy

Xerox Corporation

Yum! Brands, Inc.

Zurich


Participant Profile - Industry The following column chart summarizes the 272 survey participants by industry.

3.3% 3.3% 3.3% 3.7%4.8% 4.8% 4.8% 5.1%

6.3%

8.1%

10.7%

12.5%

14.0%

15.4%

0.0%

2.0%

4.0%

6.0%

8.0%

10.0%

12.0%

14.0%

16.0%

18.0%


Participant Profile - Revenue The pie chart below summarizes participation by revenue size. 45% of the 272 participants have revenues greater than US $10 Billion.

$30 Billion and Above19%

$15-$30 Billion16%

$10-$15 Billion10%$5-$10 Billion

22%

$3-$5 Billion12%

$1-$3 Billion15%

Less than $1 Billion6%


Competitive Pay Philosophies We asked participants to discuss their pay philosophies and we developed a series of questions focused on this topic.

Competitive Pay Philosophy – Base Pay Companies were asked to describe their compensation philosophy relative to market for base salary. 222 participants responded to this question. Clearly the

distribution of responses in the graph below shows that Market Median is the desired Base Salary competitive position for 83.7% of the participants

responding to this question. A Market Average targeted position was reported by 5.3% of the companies.

1.0%2.9% 3.3%

5.3%

83.7%

2.4% 1.4%

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

50%

55%

60%

65%

70%

75%

80%

85%

90%

Above P75 P75 P65 Average Median Below Median No Philosophy

Base Salary Philosophy / Market PositionFrequency of Responses


Competitive Pay Philosophy – Total Cash Compensation In addition to Base Salary competitive positioning, companies were also asked to indicate their desired competitive posture relative to Total Cash

Compensation. 219 companies provided responses to this particular question and the answers are summarized in the graph below. Median is again the

dominant competitive posture for Total Cash Compensation as it was for Base Salary at 77.7% of the responses

1.5%

5.8% 6.3%4.4%

77.7%

0.0%

4.4%

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

50%

55%

60%

65%

70%

75%

80%

85%

Above P75 P75 P65 Average Median Below Median No Philosophy

Total Cash Compensation Philosophy / Market PositionFrequency of Responses


Actual Practice versus Philosophy – Base Salary Since, philosophy, as represented by a company’s salary structure, is a desired or theoretical position, we wanted to know how closely actual salary practices

aligned with the stated philosophical competitive positioning. We asked companies to indicate if their practice on Base Salary was At, Above, or Below the

targeted market position. The answers from 216 companies are summarized below:

The majority of companies (75.6%) indicated that their Base Salary practices closely aligned with their desired competitive position as reflected in their

philosophy.

Above Position , 7.3%

At Desired Position, 75.6%

Below Position, 17.1%

Base Salary Practice -vs- Philosophy


Salary Structure Design: What is the primary basis for salary structure differentiation The majority of companies (41.1%) indicated that geography was their primary basis for salary structure differentiation. A combination of geography and

industry (19.4%) was also widely observed as primary basis. The answers from 187 companies are summarized below:

Geography, 41.1%

Industry Segment, 5.7%

Business Unit, 10.3%

Combination of Geography & Industry, 19.4%

Other, 23.4%

Primary Basis for Salary Structure Differentiation


Number of Salary Structures

Participants were asked to report the number of salary structures used in their organization. Responses were obtained from 190 companies and are

summarized in the table below:

Number Companies Average P 25 Median P 75

190 7.3 1.8 3.0 8.0

Salary Structure Increase Budget for 2014 Participants were asked to report their Salary Structure Increase Budget for 2014. 44 Companies Reported No Salary Structure Increase. Responses were

obtained from 170 companies and are summarized in the table below:

Survey Element # of Cos. Mean P25 Median P75

Salary Structure Increase for 2014 Incl Zeros 170 1.78% 0.00% 2.00% 2.50%

Salary Structure Increase for 2014 Excl Zeros 126 2.40% 2.00% 2.00% 3.00%


Merit Increase Budget 2014 Merit Increase Budget for 2014 (Includes Zeros) Participating companies were asked to provide the percentage increase in merit budget planned for 2014 and to indicate if this value varied by level. The survey responses from 242 companies are summarized below. Executive / Management increases were slightly lower at average than professionals and support, partially due to more zero increases for that level.


Overall Merit Budget Increase for 2014 242 2.74% 2.50% 3.00% 3.00%

Executive 196 2.64% 2.50% 3.00% 3.00%

Management 210 2.74% 2.50% 3.00% 3.00%

Professionals 210 2.74% 2.50% 3.00% 3.00%

Support / Non-Exempt 206 2.76% 2.50% 3.00% 3.00%

Merit Increase Budget for 2014 (No Zeros) The following table summarizes merit increase budgets overall and by level without zero increases. In this table mean increases for executives are slightly higher than other levels.


Overall Merit Budget Increase for 2014 235 2.82% 2.50% 3.00% 3.00%

Executive 178 2.91% 2.50% 3.00% 3.00%

Management 204 2.82% 2.50% 3.00% 3.00%

Professionals 204 2.82% 2.50% 3.00% 3.00%



Merit Increase Budget for 2014 by Industry The following table summarizes planned Merit Increase budgets for 2014 by Industry for 14 reportable industry classifications. As can be seen below, the Oil / Gas / Services, Chemical and Professional Services industries reported above par Merit Increases, while Consumer Products, Technology, and Pharmaceutical reported lower than average Merit Increase budgets for 2014.

Industry No. Cos. Avg Median

Excludes Zeros

Oil / Gas / Services 14 3.39% 3.32%

Chemical 9 3.23% 3.00%

Professional Services 6 3.00% 2.75%

Telecom / Cable / Satellite 8 2.94% 3.00%

Manufacturing 14 2.93% 3.00%

Electric & Gas Util 11 2.85% 3.00%

Financial Services 25 2.84% 3.00%

Media 9 2.78% 3.00%

Transportation / Trans Services 11 2.77% 3.00%

Retail / Wholesale 32 2.70% 3.00%

Insurance 35 2.67% 3.00%

Consumer Products 22 2.63% 3.00%

Pharmaceutical 9 2.39% 3.00%

Technology 9 2.37% 3.00%


Merit Increase Budget for 2014 by Revenue Category The following table summarizes planned Merit Increase budgets for 2014 by revenue for 7 reportable categories. At Median, the reported Merit Increase value at 3.00% was undifferentiated by revenue category.

Revenue Category No. Cos. Avg Median

Excludes Zeros

A. 30 Billion and Above 46 2.71% 3.00%

B. 15-30 Billion 41 2.61% 3.00%

C. 10-15 Billion 24 2.83% 3.00%

D. 5-10 Billion 54 2.73% 3.00%

E. 3-5 Billion 30 2.78% 3.00%

F. 1-3 Billion 35 2.81% 3.00%

G. Less than 1 Billion 12 2.85% 3.00%


Promotional Increase Budget Promotional Increase Budget for 2014 (Includes Zeros) Participating companies were asked to provide the percentage increase set aside for Promotional Increases in the 2014 budget. The survey responses from 110 companies are summarized below. The Median overall value was 0.50%.


Overall Promotional Budget Increase for 2014 110 0.38% 0.00% 0.50% 0.55%

Executive 90 0.35% 0.00% 0.23% 0.50%

Management 95 0.41% 0.00% 0.50% 0.58%

Professionals 95 0.44% 0.00% 0.50% 0.63%


Promotional Increase Budget for 2014 (No Zeros) The following table summarizes promotional increase budgets overall and by level without zero increases. In this case, Median Values were 0.50% across all career levels.



Executive 47 0.68% 0.50% 0.50% 1.00%

Management 58 0.68% 0.50% 0.50% 1.00%

Professionals 58 0.72% 0.50% 0.50% 1.00%



Special Competitive Adjustment Budget Special Competitive Adjustment Budget for 2014 (Includes Zeros) Participating companies were asked to provide the percentage increase set aside for Special Adjustments in the 2014 budget. The survey responses from 114 companies are summarized below. The Median value across all levels was 0.00%.



Executive 98 0.18% 0.00% 0.00% 0.24%

Management 100 0.32% 0.00% 0.00% 0.39%

Professionals 100 0.21% 0.00% 0.00% 0.39%


Special Competitive Adjustment Budget for 2014 (No Zeros) The following table summarizes special competitive adjustment budgets overall and by level without zero increases. In this case, Median Values across all levels was 0.50%.



Executive 31 0.56% 0.38% 0.50% 0.50%

Management 35 0.91% 0.34% 0.50% 0.50%

Professionals 34 0.62% 0.39% 0.50% 0.50%



Total Increase Budget Total Salary Increase Budget for 2014 (Includes Zeros) Participating companies were asked to provide the Total Percentage Salary Increase Budget (Merit plus Promotional plus Special) for 2014. The survey responses from 195 companies are summarized below. The Median value across all levels was 3.00%with an overall Mean was 3.04%


Overall Total Salary Budget Increase for 2014 208 3.04% 2.74% 3.00% 3.50%

Executive 167 2.90% 2.50% 3.00% 3.50%

Management 180 3.01% 2.75% 3.00% 3.50%

Professionals 180 3.03% 2.75% 3.00% 3.50%


Total Salary Increase Budget for 2014 (No Zeros) The following table summarizes the Total Salary Increase Budget for 2014, overall and by level without zero increases. In this case, Median Values across all levels was 3.00%, with an overall Mean was 3.10%


Overall Total Increase Budget for 2014 No Zeros 204 3.10% 2.75% 3.00% 3.50%

Executive 157 3.08% 2.75% 3.00% 3.50%

Management 176 3.08% 2.79% 3.00% 3.50%

Professionals 176 3.10% 2.75% 3.00% 3.50%



US Salary Budget Increase Commentary Participants were invited to comment on their US Salary Budgets for 2014. Responses were obtained from 74 companies. Narrative comments were aggregated and classified. 51.3% of those answering this question indicated that Promotional and Special Increases were not in fact budgeted at all. In these cases such increases were dealt with ad hoc, outside of the planning cycle, and were charged back to the department or function involved, post facto. In the remaining cases, a single percentage amount was set aside to cover both Promotional and Special Increases, but discretion was allowed as to the allocation of weights between those two elements. These findings are consistent with similar responses in prior years.


Forecasted Salary Structure Increase Budget for 2015 Participants were asked to forecast their Salary Structure Increase Budget for 2015.Responses were obtained from 120 companies and are summarized in the

table below:


Forecasted Salary Structure Increase for 2015 Incl Zeros 120 1.99% 1.50% 2.00% 3.00%

Forecasted Salary Structure Increase for 2015 Excl Zeros 97 2.47% 2.00% 2.00% 3.00%


Forecasted Merit Increase Budget for 2015 Forecasted Merit Increase Budget for 2015 (Includes Zeros) Participating companies were asked to indicate the forecasted merit increase budget for 2015, if known. Responses were obtained from 188 companies and are summarized in the table below (which includes forecasted zero increases):


Overall Forecasted Merit Increase Budget for 2015 188 2.88% 2.80% 3.00% 3.00%

Executive 149 2.82% 2.80% 3.00% 3.00%

Management 161 2.86% 2.90% 3.00% 3.00%

Professionals 161 2.87% 2.90% 3.00% 3.00%


Forecasted Merit Increase Budget for 2015 (Excludes Zeros) The following table summarizes forecasted merit increase budgets for 2015 (excluding zero increases).


Overall Forecasted Merit Increase Budget for 2015 186 2.91% 2.83% 3.00% 3.00%

Executive 142 2.96% 3.00% 3.00% 3.00%

Management 159 2.90% 3.00% 3.00% 3.00%

Professionals 159 2.90% 3.00% 3.00% 3.00%



Forecasted Promotional Increase Budget for 2015 Forecasted Promotional Increase Budget for 2015 (Includes Zeros) Participating companies were asked to forecast the Promotional Increase budget for 2015. The survey responses from 86 companies are summarized below. The Median overall value was 0.50%.


Overall Forecasted Promotional Budget Increase for 2015 86 0.39% 0.00% 0.50% 0.50%

Executive 66 0.37% 0.00% 0.35% 0.50%

Management 70 0.38% 0.00% 0.39% 0.50%

Professionals 70 0.38% 0.00% 0.39% 0.50%


Forecasted Promotional Increase Budget for 2015 (No Zeros) The following table summarizes the promotional increase forecast overall and by level without zero increases. In this case, Median Values were 0.50% across all career levels.


Overall Forecasted Promotional Budget Increase for 2015 54 0.63% 0.50% 0.50% 1.00%

Executive 35 0.70% 0.50% 0.50% 1.00%

Management 40 0.66% 0.50% 0.50% 1.00%

Professionals 40 0.66% 0.50% 0.50% 1.00%



Forecasted Merit Increase Budgets for 2015 by Industry The following table summarizes forecasted Merit Increase budgets for 2015 by Industry for 14 reportable industry classifications. Chemical, Oil / Gas / Services and Telecom / Cable / Satellite had the highest average forecasted Merit Increase Budgets for 2015.


Excludes Zeros

Chemical 9 3.33% 3.10%

Oil / Gas / Services 11 3.32% 3.00%

Telecom / Cable / Satellite 7 3.07% 3.00%

Manufacturing 13 3.00% 3.00%

Transportation / Trans Services 7 2.93% 3.00%

Consumer Products 16 2.90% 3.00%

Retail / Wholesale 24 2.88% 3.00%

Technology 6 2.83% 3.00%

Financial Services 22 2.82% 3.00%

Insurance 26 2.77% 3.00%

Media 9 2.72% 3.00%

Pharmaceutical 6 2.67% 3.00%

Electric & Gas Util 10 2.66% 3.00%


Forecasted Merit Increase Budget for 2015 by Revenue The following table summarizes forecasted Merit Increase budgets for 2015 by Revenue Category for 7 reportable classifications.


A. 30 Billion and Above 38 2.84% 3.00%

B. 15-30 Billion 30 2.65% 3.00%

C. 10-15 Billion 11 2.86% 3.00%

D. 5-10 Billion 43 2.93% 3.00%

E. 3-5 Billion 27 2.99% 3.00%

F. 1-3 Billion 31 2.99% 3.00%

G. Less than 1 Billion 9 2.94% 3.00%


Forecasted Special Competitive Adjustment Budget for 2015 Forecasted Special Competitive Adjustment Budget for 2015 (Includes Zeros) Participating companies were asked to provide the percentage increase forecasted for Special Adjustments for 2015. The survey responses from 73 companies are summarized below. The Median value across all levels for non-zero awards was 0.50%.


Overall Forecasted Special Adjustment Budget 73 0.22% 0.00% 0.00% 0.50%

Executive 59 0.22% 0.00% 0.00% 0.50%

Management 60 0.21% 0.00% 0.00% 0.50%

Professionals 60 0.21% 0.00% 0.00% 0.50%


Forecasted Special Competitive Adjustment Budget for 2015 (No Zeros) The following table summarizes forecasted special competitive adjustment budgets overall and by level without zero increases. In this case, Median Values across all levels was 0.50%.


Overall Forecasted Special Adjustment Budget 33 0.48% 0.25% 0.50% 0.50%

Executive 22 0.58% 0.31% 0.50% 0.50%

Management 24 0.52% 0.25% 0.50% 0.50%

Professionals 24 0.52% 0.25% 0.50% 0.50%



Forecasted Total Increase Budget for 2015 Forecasted Total Salary Increase Budget for 2015 (Includes Zeros) Participating companies were asked to provide the Forecasted Total Percentage Salary Increase Budget (Merit plus Promotional plus Special) for 2015. The survey responses from 164 companies are summarized below. The Median value across all levels was 3.00%.


Forecasted Total Salary Budget Increase for 2015 164 3.11% 3.00% 3.00% 3.50%

Executive 131 3.28% 3.00% 3.00% 3.50%

Management 143 3.09% 3.00% 3.00% 3.50%

Professionals 143 3.07% 3.00% 3.00% 3.50%


Forecasted Total Salary Increase Budget for 2015 (No Zeros) The following table summarizes the Forecasted Total Salary Increase Budget for 2015, overall and by level without zero increases. In this case, Median Values across all levels was 3.00%.


Forecasted Total Increase Budget for 2015 No Zeros 161 3.17% 3.00% 3.00% 3.50%

Executive 126 3.41% 3.00% 3.00% 3.50%

Management 141 3.13% 3.00% 3.00% 3.50%

Professionals 140 3.14% 3.00% 3.00% 3.50%



Short Term Incentives Bonuses Paid in 2014 for 2013 Performance Participants were asked to indicate if bonuses paid in 2014 for 2013 performance, were Higher, Lower or About the Same, relative to bonuses paid in 2013 for 2012 performance. 205 Companies responded to this question. Over 74% indicated that bonus payouts were either the same or higher relative to payments in 2013. The Pie chart below summarizes the distribution of answers provided.

Responses # Responses % of Total

About The Same 87 42.4%

Higher 65 31.7%

Lower 53 25.9%

Total 205 100.0%

About The Same42.4%

Higher31.7%

Lower25.9%

Bonus Payout Variance 2014 vs 2013


Long Term Incentive Targets Companies were asked to provide their Long Term Incentive Targets Overall / All Departments Combined, by Level and by functional area, if different. Responses were obtained from 78 companies and are summarized in the following tables: LTI Targets - Executives

Department # of Cos. Mean P25 Median P75

All Departments Combined 78 63.30% 35.00% 50.00% 75.00%

Law Department 24 62.21% 38.75% 61.00% 77.25%

Finance 21 53.26% 30.00% 50.00% 65.00%

Compliance Department 17 46.38% 30.00% 40.00% 55.00%

Accounting Department 21 50.45% 30.00% 50.00% 65.00%

Audit Department 21 48.18% 30.00% 50.00% 60.00%

Government Relations 16 52.85% 33.75% 48.00% 61.25%

Corporate Communications 20 46.04% 30.00% 41.00% 56.25%

Human Resources 24 54.73% 31.50% 49.00% 64.25%

Information Technology 23 47.71% 30.00% 43.00% 57.50%


LTI Targets - Management


All Departments Combined 70 22.84% 15.00% 21.15% 29.25%

Law Department 20 20.97% 14.50% 18.15% 25.00%

Finance 17 21.69% 15.00% 18.00% 25.00%






Human Resources 20 20.71% 13.00% 19.50% 25.00%



LTI Targets - Professionals


All Departments 29 14.48% 10.00% 15.00% 19.00%

Law Department 5 15.92% 10.00% 11.00% 18.00%

Finance 4 14.46% 9.06% 10.50% 15.90%






Human Resources 4 15.40% 10.00% 10.50% 15.90%



2014 Stock Awards Commentary Participants were invited to comment on actions taken in relation to stock awards for 2014. Responses were obtained from 102 companies. Narrative comments were aggregated and classified. The majority of comments (33%) indicated that no major changes were planned for 2014. 4% of companies indicated that they plan to increase stock option award amounts. 5% of companies indicated that they plan to expand stock award eligibility. 5% indicated that they planned to reduce eligibility. 3% of companies indicated they plan to increase use of restricted shares.


2014 Staffing Expectations Participants were asked to indicate whether they expected their company's workforce in 2014 will stay the same, increase, or decrease relative to 2013. 202 Companies responded to this question, over 90% indicated that they expected their workforce to the same or increase (up 5% from 85% last year). The Pie chart below summarizes the distribution of answers provided.


Stay the same 113 55.9%

Increase 68 33.7%

Decrease 21 10.4%

Total 202 100.0%

Stay the same55.9%

Increase33.7%

Decrease10.4%

2014 Staffing Expectations vs 2013


Departmental Staffing Levels – US

Participants were asked to enter their US headcount for various identified departments. Responses were provided by 193 companies and are summarized

below:

Departmental Staffing – US


All Departments 193 22456.3 3571.0 7421.0 19886.0

Law Department 169 100.9 22.0 44.0 103.0

Finance 152 361.9 59.3 142.5 405.3

Compliance 102 70.0 10.0 30.0 65.8

Accounting 108 152.9 43.0 87.5 148.3

Audit 109 30.3 10.0 18.0 35.0

Government Relations 91 26.9 3.5 7.0 17.0

Corporate Communications 126 37.3 6.0 16.0 40.0

Human Resources 159 192.6 50.0 102.0 221.0

Information Technology 158 840.5 154.5 400.5 815.0

Marketing 141 240.9 38.0 84.0 252.0

Social Media 34 5.8 2.0 4.0 8.8


Law Department Staffing – US Participants were asked, in addition, to provide information on the staffing of the Law Department in the US, by defined levels. Information was collected

from 173 participants and this information is summarized below:

Law Department Staffing – US:

Level # of Cos. Mean P25 Median P75

Legal Executives 172 7.9 2.0 4.0 8.0

Attorneys 173 47.3 8.0 19.0 42.0

Paralegals 164 18.9 3.0 7.0 15.3

Administrative Support 163 27.1 4.0 7.0 15.5


Issues of Concern Participants were asked to rank order (from 1 to 6) which issues of concern were of most concern to their organization from a compensation perspective.

Compensation Competitiveness and Employee Retention were the most highly ranked concerns (as they were last year). Responses from 189 companies are

summarized below.

Item Total Score * Overall Rank

Compensation Competitiveness 813 1

Employee Retention 805 2

Skills Shortages 696 3

Cost of Benefits 695 4

Employee Morale 567 5

Falling Unemployment 265 6

* Score is a weighted calculation. Items ranked first are valued higher than the following ranks, the score is the sum of all weighted rank counts.


College / MBA Hire Practices Participants were asked to indicate their New College Hire Practices with respect to Average Hiring Rates and Average Sign-On Bonuses. Responses from 67

companies are summarized in the two tables below:

Average Hire Rate

Degree Classification # of Cos. Mean P25 Median P75

Bachelors – Non-Technical 67 $51,757 $45,000 $51,500 $55,500

Bachelors – Technical 64 $61,619 $55,000 $60,000 $65,000

Bachelors – Top Tier 34 $64,379 $55,000 $63,126 $70,000

MBA 46 $88,257 $75,000 $90,445 $102,750

Masters – Non MBA 42 $73,899 $65,000 $71,000 $83,750

Sign On Bonus Practices – for those paying Bonuses

Degree Classification # of Cos. Mean P25 Median P75

Bachelors – Non-Technical 20 $3,809 $2,875 $3,594 $5,000

Bachelors - Technical 27 $6,993 $2,750 $5,000 $5,000

Bachelors – Top Tier 16 $6,294 $4,750 $5,000 $5,425

MBA 26 $16,092 $8,917 $16,250 $24,250

Masters – Non MBA 18 $9,022 $5,000 $8,250 $10,000


2014 College Hire Rates vs. 2013 Participants were asked to compare the hiring rates offered in 2014 versus the rates for the same period in 2013, using a scale of Higher, Lower or About the

Same. 143 companies provided responses to this question and the answers are summarized below:


About the same 110 76.9%

Higher 29 20.3%

Lower 4 2.8%

Total 143 100.0%

The average increase in new college hires was 5.4%.

Higher20.3%

About the Same76.9%

Lower2.8%

Hire Rates

Documents

2014 Policies, Pr act ices and M er it Repor t I nclu des ... 2014... · The Digital Marketing / Marketing survey targets large Fortune 500 and multinational companies who have larger