AbbVie Inc
For the period ended May 3, 2024. Filed Mar 18, 2024.
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May 3, 2024 · Filed Mar 18, 2024
Contents
Components of our Compensation Program
| Components of our Executive Compensation ProgramThe compensation committee of the board oversees our executive compensation program, which includes several compensation elements that have each been tailored to incentivize and reward specific aspects of company performance the board believes are central to delivering long-term stockholder value. Key components of our annual compensation program are listed below. | ||||||
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| Base SalaryDesigned to be competitive with market and industry norms, and to reflect individual performance Individual salaries are established relative to market median based on each NEO’s individual performance, skills, and experience, and internal equity, as well as the company’s annual operating budget | | Short-TermIncentivesPerformance Incentive Plan (PIP)Based on non-GAAP performance measures such as:— Platform revenue — Income before taxes— Operating margin— Return on assets— Strategic and leadership goals | | Long-TermIncentives80% Performance shares and performance-vested restricted stock units20% Non-qualified stock options | | Our CompensationPhilosophy |
| Align executive interests with the drivers of stockholder returns and profitable growth | ||||||
| Support achievement of the company’s primary business goals to have a remarkable impact on patients’ lives | ||||||
| Attract and retain world-class executives whose talents and contributions sustain the growth in long-term stockholder value | ||||||
The compensation committee is dedicated to ensuring that a substantial portion of executive compensation is “at-risk” and variable. Generally, more than three-fourths of our NEOs’ total direct compensation is variable and directly affected by both the company’s and the NEO’s performance, as indicated below.
The committee believes the use of non-GAAP metrics to measure company performance for incentive plan purposes is appropriate. The use of certain non-GAAP metrics aligns NEOs to performance objectives that are commonly used to evaluate the performance of the company, provide accountability, and avoid inappropriate windfalls or penalties due to factors outside of their control. Importantly, both the goals and the financial performance are presented on a consistent non-GAAP basis.
40 * | 2024 Proxy Statement*
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| | EXECUTIVE COMPENSATION |
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