Electronic Arts 2011 Annual Report Download - page 39

Proxy Statement
Management then formulated compensation recommendations for our executive officers (including all NEOs
other than Mr. Riccitiello), aided by the information provided by Compensia and each executive officer’s annual
performance review. The formal performance reviews for our NEOs were conducted by Mr. Riccitiello, with
assistance from our Executive Vice President of Human Resources and Facilities.
In February 2010, the Committee reviewed the equity compensation of our executive officers, including each of
our NEOs (other than for Mr. Riccitiello) and made equity award decisions for fiscal 2011. The Committee
approved these awards with a grant date of May 17, 2010. In May 2010, the Committee also reviewed the
non-equity compensation of our executive officers and made base salary and target cash bonus adjustments for
fiscal 2011, as well as the fiscal 2010 cash bonus decisions. These decisions were made after consideration of the
following factors, where applicable:
• the Company’s compensation philosophy and the three compensation principles discussed at the
beginning of this Compensation Discussion and Analysis;
• the financial, strategic and operational performance of the Company and the executive’s relevant business
unit (as applicable);
• the individual performance of each executive officer, as evaluated by management;
• the market data provided by Compensia; and
• the current unvested equity holdings and compensation of each executive officer.
Determining CEO Compensation
For Mr. Riccitiello, the compensation-setting process differed from our other NEOs as follows. A formal
performance review was conducted by the Nominating and Governance Committee of the Board, with the
assistance of the Executive Vice President of Human Resources and Facilities, taking into consideration
Mr. Riccitiello’s and the Company’s financial, strategic and operational performance. That review was provided
to the Committee, which then developed compensation recommendations for Mr. Riccitiello, with assistance
from Compensia. The compensation recommendations and performance review were then presented to the full
Board, which subsequently approved Mr. Riccitiello’s cash bonus payout, base salary, target cash bonus
opportunity and equity award.
INDIVIDUAL NEO COMPENSATION
This section describes how the base salary, annual cash bonus and equity awards were determined for each of our
NEOs for fiscal 2011. Cash bonus awards were funded under the Electronic Arts Inc. Executive Bonus Plan (the
“Executive Bonus Plan”) based on the attainment of a pre-set non-GAAP earnings per share performance
measure (as described below under “Executive Bonus Plan”). The amount of the actual cash bonus award for
each NEO was then determined based on an assessment of each NEO’s performance during fiscal 2011.
Individual business unit financial (as applicable), strategic and operational objectives for each NEO were set at
the beginning of the fiscal year and the objectives and achievements relevant to the fiscal 2011 bonus
determination are discussed below. There was no mathematical calibration of bonus payments based on the
financial objectives for each NEO. Rather, these objectives, like the other individual strategic and operational
objectives, were evaluated on a qualitative basis by the Committee, which considered all of the factors discussed
below in making their determination without assigning any specific weighting to the factors. For Mr. Riccitiello,
each financial, strategic and operational objective was assigned a percentage weighting of his overall bonus;
however, the final bonus award was determined based on an overall, qualitative assessment of his performance
against objectives rather than a mathematical formula.
The following tables show the year-over-year change in base salary, annual cash bonus, equity awards and total
direct compensation for our NEOs, but exclude other compensation elements which are discussed in the
Summary Compensation Table, such as life insurance and disability premiums, Company matching 401(k)
contributions and relocation related-costs, among others. In fiscal 2011, other compensation elements did not
constitute a material portion of any NEO’s compensation. The total direct compensation tables which follow are
provided as additional information; please refer to the Summary Compensation Table for information regarding
the total compensation paid to our NEOs in fiscal 2011.
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