2018 Guide to Effective Proxies

6 TH EDITION | GUIDE TO EFFECTIVE PROXIES 254 Notice of 2018 Annual Meeting of Stockholders and Proxy Statement 54 Compensation Discussion and Analysis This Compensation Discussion and Analysis provides a summary of our executive compensation philosophy and programs and describes the compensation decisions we have made under these programs and the factors considered in making those decisions. This Compensation Discussion and Analysis and the Executive Compensation Tables focus on the compensation of our NEOs for 2017. Business Performance Highlights 55 Decision-Making Framework Key Governance Features of Executive Compensation Program Total Rewards Philosophy Say on Pay Results Compensation Determinations Competitive Positioning Peer Group President and CEO's Role in the Executive Compensation Process Role of Compensation Consultants Tally Sheets 55 56 58 58 58 59 60 60 60 What We Pay and Why: Elements of Executive Compensation Pay for Performance Base Salary Annual Incentive Compensation Long-Term Incentive Compensation Benefits Severance Other 62 62 63 68 72 72 73 Risk Mitigation and Other Pay Practices Risk Assessment of Compensation Program Stock Ownership Guidelines Stock Holding Guidelines Trading Controls and Hedging and Pledging Policies Incentive Recoupment Policy Tax and Accounting Implications of Executive Compensation 73 73 74 74 75 75 NASDAQ, INC.