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Operating earnings per diluted share excluding foreign currency effect rose 7.5% in 2015, presenting a challenging
comparison for 2016. Aflac Japan earnings are impacted by the low rate environment and an expected
premium decline from the Company’s tactical decision to de-emphasize first sector savings products. For Aflac
U.S., expense ratios were expected to increase modestly in 2016 as a result of investment in overall IT, group
product administration and everwell platforms. This combination of natural sales patterns in Japan, the low rate
environment’s impact on net investment income, and increased investment in the business led to modestly
lowered consolidated profitability targets for 2016.
TARGET BONUS OPPORTUNITY
Target bonuses for 2016 for the NEOs, which were determined to be competitive relative to comparable positions
within our peer group, were as follows:
The MIP opportunities for all NEOs are capped at 200% of their target opportunities.
WEIGHTINGS OF EACH PERFORMANCE OBJECTIVE FOR 2016
The performance measures are weighted differently for each NEO and for all other officer levels in the Company.
We vary the weightings to reflect how each position can and should influence the outcome of particular metrics.
Weightings of Annual Incentive Metrics as a Percent of Target
Daniel P. Amos Frederick J. Crawford Kriss Cloninger III
Paul S. Amos II
Eric M. Kirsch
Corporate Objectives:
Operating earnings per diluted share on
a consolidated basis for the Company
(excluding foreign currency effect)
22.73%
24.00%
22.67%
24.00%
30.00%
OROE (excluding foreign currency effect)
11.36%
8.80%
9.33%
8.00%
15.00%
SMR
11.36%
8.80%
9.33%
8.00%
15.00%
Net Investment Income excluding hedge costs
(Consolidated)
9.10%
8.00%
8.67%
8.00%
30.00%
Subtotal Aflac Incorporated
54.55%
49.60%
50.00%
48.00%
90.00%
U.S. Segment:
New Annualized Premium
6.81%
5.20%
5.33%
–
–
Direct Premiums
4.55%
5.20%
5.33%
–
–
Pretax Operating Earnings
4.55%
5.60%
6.01%
8.00%
–
Subtotal
15.91%
16.00%
16.67%
8.00%
–
Japan Segment:
New Annualized Premium (third sector sales)
11.36%
10.40%
10.00%
16.00%
–
Direct Premiums
9.09%
10.40%
10.00%
8.00%
–
Pretax Operating Earnings
9.09%
13.60%
13.33%
20.00%
–
Subtotal
29.54%
34.40%
33.33%
44.00%
–
Global Investments:
Credit Losses/Impairments
–
–
–
–
10.00%
Subtotal
–
–
–
–
10.00%
GRAND TOTAL
100.00%
100.00% 100.00% 100.00% 100.00%
Named Executive Officer
Target MIP
(as percent of base salary)
Daniel P. Amos
220%
Frederick J. Crawford
125%
Kriss Cloninger III
150%
Paul S. Amos II
125%
Eric M. Kirsch
200%
Compensation Discussion & Analysis
|
Elements of Our Executive Compensation Program
AFLAC INCORPORATED
2017 PROXY STATEMENT
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