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What We Do
First public company in the U.S. to provide shareholders with
a say-on-pay vote (voluntary action starting in 2008, three years
before such votes were required)
Prioritize active engagement with our shareholders regarding our
compensation program
History of responding to our shareholders’ feedback
Adherence to a rigorous pay for performance philosophy in
establishing program design and targeted pay levels for its NEOs
Independent Compensation Committee oversees the program
Independent compensation consultant is hired by and reports to the
Compensation Committee
Annual report by the independent compensation consultant to the
full Board on CEO pay and performance alignment
Long-standing stock ownership guidelines for executive officers
and Directors
Long-standing clawback policy
Supplemental Executive Retirement Plan frozen to new participants
effective January 1, 2015
Double trigger change-in-control requirements in all employment
agreements
What We Don’t Do
No golden parachute
payments for CEO or
President following a
change in control
Officers and Directors may
not implement 10b5-1 plans
unless approved by the
Compensation Committee
Officers and Directors may
not hedge or engage in short
sales of Company stock
Executive officers and
Directors may not pledge
Company stock, and
“grandfathered” pledged
Company stock does not
count toward the stock
ownership guidelines
No repricing underwater
stock options
No change-in-control excise
tax gross-ups
Strong Compensation Governance Policies and Leader in
Best Practices
The Company has been a leader in corporate governance best practices. Our executive compensation programs
reflect the strong, long-standing governance principles outlined below.
Independent Compensation Consultant
The Compensation Committee has retained a nationally recognized compensation consultant, Mercer LLC,
to assist and advise the Compensation Committee in its deliberations. Mercer works with the Compensation
Committee to review executive compensation practices, including the competitiveness of pay levels, design issues,
market trends, and other technical considerations.
Mercer typically assists in the following areas:
●●
providing comparative company performance to determine CEO pay;
●●
evaluating the competitiveness of the Company’s executive compensation and benefit programs;
●●
reviewing plan design issues and recommending improvements;
●●
apprising the Compensation Committee of trends and developments in the marketplace;
●●
assessing the relationship between executive pay and performance;
●●
assessing proposed performance goals and ranges for incentive plans;
●●
providing comparative company data to determine NEO compensation;
●●
conducting training sessions for the Compensation Committee; and
●●
determining the compensation of Non-employee Directors.
Fees paid to Mercer for these services totaled $286,295 in 2016. Management retained certain Mercer affiliates to
provide additional services not pertaining to executive compensation during 2016, and approved payments totaling
$16,139,173—primarily for broker commissions for insurance sales—for those services. As reported by Mercer
to the Compensation Committee, these payments represented less than 0.15% of Mercer’s parent company’s
annual revenue. The Compensation Committee has assessed Mercer’s independence pursuant to SEC rules and
concluded that no conflict of interest exists with respect to the work Mercer performs for the Committee.
Compensation Discussion & Analysis
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Executive Summary
AFLAC INCORPORATED
2017 PROXY STATEMENT
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