2018 Guide to Effective Proxies

2.17.5 Elements of pay tables | 377 6 TH EDITION | GUIDE TO EFFECTIVE PROXIES COMPENSATION DISCUSSION AND ANALYSIS (continued) Overview of Pay Elements For 2017, guided by our compensation philosophy and objectives, the executive compensation program con- sisted of the elements listed below. The Compensation Committee believes that each compensation element, and all of these elements combined, are important to maintain an executive compensation program that is competitive, performance-based and shareholder-focused. ELEMENT DESCRIPTION LINK TO STRATEGY & BUSINESS MORE DETAIL • Market competitive fixed pay, reflective of individual performance, time in role, scope of responsibility, leadership skills and experience. • Reviewed on an annual basis against individual performance and compensation market data and adjusted, as appropriate, to maintain market alignment. • Competitive base salaries help attract and retain key executive talent. • Material adjustments are based on individual performance and market data and are not guaranteed. Pg. 54 • Rewards performance to achieve short- term business objectives that grow annual organic revenue, increase profitability and draw focus to the bottom line to create greater efficiencies, all of which we believe ultimately drive increased long- term shareholder value. • Also motivates executives to deliver individual performance against strategic objectives. Pg. 54 PSUs • These long-term equity and long-term cash incentive awards promote executive share ownership and alignment with shareholders’ interest in the Company’s long-term growth. • Plan design ensures that executives have compensation that is performance based for longer periods of time and mitigates excessive risk-taking over a long-term horizon. • Awards support retention objectives and are subject to forfeiture in the event that an executive terminates their employment. Pg. 59 RSUs • Health, welfare and retirement programs. • NEOs generally participate in the same benefit programs that are offered to other salaried employees. Pg. 62 • Limited perquisites. • Reasonable, limited perquisites are provided to executives to facilitate strong performance on the job and enhance their productivity. Base Salary Short-Term Annual Incentive Long- Term Incentives Long- Term Cash Awards • Performance-based cash compensation dependent on performance against annually established 30%- weighted individual and 70%-weighted Company financial targets (comprised of ICP Adjusted Revenue and ICP Adjusted EBITA targets). • Our NEOs are assigned a target incentive award with the actual award calculated as a percentage of this target. • The maximum incentive award payout is capped at 200% of the target award. • For most NEOs, PSUs represented 70% of the total long-term incentive grant value. • Based on three-year growth in ICP Adjusted EPS with maximum earnings potential capped at 200% of the target award. • Awards vest upon completion of the three-year performance period and the Compensation Committee's certification of performance. No dividends are paid on unearned PSUs. • For most NEOs, RSUs represented 30% of the total long-term incentive grant value. • Long-term annual equity-based incentives, whose ultimate value is tied to Company performance through stock price. • 2017 awards vest ratably on each of the three fiscal year-end dates following the grant of the award. No dividends are paid on unearned RSUs. • For Mr. Matturri, long-term cash represented 60% of the long-term incentive grant value, with the remaining 40% made up of a mix of 70% PSUs and 30% RSUs. • Based on three-year growth in division specific EBITA with a maximum payout capped at 200% of the target award. • Awards vest upon completion of the three-year performance period and the Compensation Committee's certification of performance. A N N U A L F I X E D V A R I A B L E / P E R F O R M A N C E � B A S E D L O N G � T E R M Other Pg. 62 42 2018 Proxy Statement ELEMENTDESCRIPTIONLINKTOSTRATEGY&BUSINESSMOREDETAILFixedAnnualLongiTermVariable/Performance-BasedBaseSalaryShort-TermAnnualIncentiveLong-TermIncentivesPSUsRSUsLong-TermCashAwardsOtherMarketcompetitivefixedpay,reflectiveofindividualperformance,timeinrole,scopeofresponsibility,leadershipskillsandexperience.Reviewedonanannualbasisagainstindividualperformanceandcompensationmarketdataandadjusted,asappropriate,tomaintainmarketalignment.Performance-basedcashcompensationdependentonperformanceagainstannuallyestablished30%-weightedindividualand70%-weightedCompanyfinancialtargets(comprisedofICPAdjustedRevenueandICPAdjustedEBITAtargets)OurNEOsareassignedatargetincentiveawardwiththeactualawardcalculatedasapercentageofthistarget.Themaximumincentiveawardpayoutiscappedat200%ofthetargetaward.FormostNEOs,PSUsrepresented70%ofthetotallong-termincentivegrantvalue.Basedonthree-yeargrowthinICPAdjustedEPSwithmax- imumearningspotentialcappedat200%ofthetargetaward.Awardsvestuponcompletionofthethree-yearperformanceperiodndteCompensationCommittee’scertificationofperformance.NodividendsarepidonunearnedPSUs.FormostNEOs,RSUsrpresented30%ofthttallong-ermicentivegrantvalue.Long-ermnnualequity-basedincentivs,whoseultimtevalueistiedtoCompanyperformancethroughstockrice.2017awardsvestratablyoneachofthethrefiscalyear-enddatesfollowingthgrantoftheaward.NodividendsarepaidonunearndRSUs.ForMr.Matturri,long-termcashrepresented60%ofthelong-termincentivegrantvalue,withthermaining40%madeupofamixof70%PSUsand30%RSUs.Basedonthree-yeargrowthindivisionspcfiEBITAwithamaximumpayoutcappedat200%ofthtargetaward.Awardsvestuponcopletionofthethree-yearperformanceperidandtheCompensationCommittee’scetificationofperfrmance.Health,welfareadretiementprogrms.Limitedprquisites.Competitivebasesalareshelp attractndretainkeyexeutivtlent.Materialadjustmentsarebasedonindividualperfrmanceandmarketdataandarenotguaned.Rewardsperforanctahiveshrt-ermbusinessobjectvsthatgownnualorgaicrvenue,increaseprofitabilityanddrawfocustotebottomlintocreatgreatrefficiencies,allofwhichwbeieveultimatlydriveincrasedlong-termshrholdervalue.Alsomotivatsexcutivestodeliverindividualperfomnceagainststrategicobjectives.Theselong-ermequityandlong-termcshincentiveawardspomoteexecutiveshaeowneshipandalignmentwithshareholders’interestntheCompany’slong-trmgrowth.Plandesignnsuresthatexecutiveshavcompensationthatisperformancebasedforlongerperiodoftimendmtgatesexcessiverisk-takingoveralong-termhorizon.Awardssupportretentionobjectivesandaresubjecttoforfeitueintheventthatanexecutiveterminestheiremploymen.NEOsgnerallypartiipateinthesamebenefitprogramsthatarefferedtoothesalariedemployees.Resonable,lim- itedprquisitesareprovidedtoexcutivestofacilitatestrongperformanceonthejbandenhncethirpoductivity. S&P GLOBAL, INC.