FACTSET RESEARCH SYSTEMS INC
For the period ended Dec 19, 2024. Filed Oct 30, 2024.
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Dec 19, 2024 · Filed Oct 30, 2024
Contents
Core Elements of Total Direct Compensation
In making compensation decisions, the Compensation and Talent Committee has sought to reinforce the correlation between FactSet’s performance and executive compensation. The Compensation and Talent Committee has designed the executive compensation program to motivate, retain, engage and appropriately reward our executive officers. Compensation for our NEOs is based both on operating performance at FactSet's collective and strategic workflow levels as well as the NEO's individual performance toward executing FactSet’s strategy, accelerating growth, and contributing to company-wide results. By encouraging NEOs to strive for outstanding individual and team performances, they are expected in turn to drive the positive performance of FactSet as a whole.
The core elements of our NEOs’ compensation package consist of base salary, annual incentive and long-term incentive, which we collectively refer to as "Total Direct Compensation." Incentive awards are composed of a mix of annual incentives in the form of cash and long-term incentive equity grants, which may include stock options, performance share units ("PSUs"), and restricted share units ("RSUs"). Taken together, Total Direct Compensation is tied to performance and closely linked to long-term growth, achievement of financial objectives, and stock price appreciation.
The principal components of our current executive compensation program include the following:
| Total Compensation Element | Payment Form | Performance Measure/Determinant | Strategy & Performance Alignment |
|---|---|---|---|
| Base Salary | Cash | •A fixed element of compensation that recognizes an individual's role and expertise •Intended to be competitive to attract and retain key employees | •Reviewed on an annual basis and is periodically adjusted to be based on individual performance and contributions, market trends, and competitive position•There is no formula to review base salaries, and no one factor is weighted more heavily than another |
42 2024 Proxy Statement
| Annual Incentive | Cash | Company Performance (80%)•For corporate leadership, ASV plus Professional Services Growth and Adjusted Operating Margin on a company-wide level•For strategic workflow heads, ASV plus Professional Services Growth and Adjusted Operating Margin both on a company-wide level and on a strategic workflow level•Minimum level of performance required for financial component of annual incentiveIndividual Goals (20%)•Key goals established for each NEO | •Rewards and recognizes annual accomplishment of key financial objectives•Performance measures aligned with FactSet’s growth, both on a company-wide and strategic workflow basis•Specified performance achievements required to fund incentive payments. If one or more components of performance does not reach threshold level, some or all of the financial target portion of the annual incentive would not be paid to NEOs unless the Compensation and Talent Committee were to do so in its discretion•Key individual goals are within the NEO’s area of responsibility and assessed annually |
|---|---|---|---|
| Long-Term Incentives | Stock Options | •Stock price•Accounts for 50% of our NEO Long-Term Incentive awards | •Increases alignment with long-term stockholder interests•Promotes an ownership mindset, as the awards can greatly increase in value as long as there is stock price appreciation •NEOs only benefit if our stock price appreciates from the date of grant of the award•Five-year vesting period encourages retention and long-term horizon |
| Long-Term Incentives | Performance Share Units | •Stock price•Accounts for 50% of our NEO Long-Term Incentive awards | •Rewards and recognizes accomplishment of key financial objectives over a three-year period corresponding to FactSet's current three-year plan•Performance measures aligned with FactSet’s growth•Aligns with stockholder interests as the awards can greatly increase in value when there is stock price appreciation and exceptional performance |
2024 Proxy Statement 43
| Long-Term Incentives | Restricted Share Units | •Stock price | •Increases alignment with stockholder interests•Promotes an ownership mindset, as the awards can greatly increase in value when there is stock price appreciation •Three to five year vesting period encourages retention and long-term horizon |
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