Wells Fargo

Wells Fargo

Wells Fargo & Company is an American multinational financial services company headquartered in San Francisco, California,  with central offices throughout the United States. It is the world's fourth-largest bank by market capitalization and the fourth largest bank in the US  by total assets.   Wells Fargo is ranked number 26 on the 2018 Fortune 500 rankings of the largest US corporations by total revenue.

Performance Management of Wells Fargo:

The overall objectives of PM&R are to align with Wells Fargo Vision and Values, reinforce our Culture of Caring, and support important business objectives including building engaging work environments, delivering exceptional customer experiences, growing and deepening lifelong customer relationships, all while effectively managing oversight and accountability, and maintaining the highest level of integrity and ethics.

 1. No product sales goals.

 2. Performance will be based on customer service, branch primary customer growth (i.e. the growth of checking account customers that use Wells Fargo as their main financial institution) and not simply opening new accounts. Earning incentives will NOT depend on reaching sales goals. 

3. Focus on the team, not just individuals. More metrics will be weighted towards team (branch) goals rather than individual goals.

 4. Additional Oversight. There will be controls in place to monitor bad behavior, including more proactive monitoring and additional oversight at the regional and corporate level. 

5. There will be periodic reviews and checkpoints to monitor any unintended outcomes or behavior prompted by the new compensation plan

Compensation Management of Wells Fargo:

Compensation program reflects our compensation principles: Pay for Performance; Attract and Retain Top Executive Talent; Foster Risk Management Culture; and Encourage Long-Term Shareholder Value Creation. Pay Element 2018 Form Key Metrics Purpose Base Salary Cash Fixed • Fixed compensation reflecting experience and responsibility Annual Cash • Based on performance objective framework that • Rewards Company performance, Incentive focuses on pre-established objectives that include business line performance, risk Award expectations for both “what” is achieved and “how” it is management, effective achieved (see next slide for more detail on framework) management, leadership, and risk accountability • May be earned from zero to 150% of annual base salary (except for the CEO, who does not have a target amount) Long-Term Performance • Performance Shares establish direct link to Company • Aligns management and At Compensation Shares and share-price performance shareholder interests o Based on 3-year RORCE relative to Financial • Emphasizes performance-based Risk Performance Peer Group, subject to absolute culture performance levels • Creates strong long-term o May vest from zero to 150% of target, but payout performance incentive, ownership, capped at 125% if relative TSR is not in top and retention tool quartile o Amount reduced if net operating loss during any year of performance o Subject to forfeiture conditions giving the HRC discretion to forfeit all or a portion of unpaid awards upon the occurrence of specified conditions

2018 Compensation Decisions 

 CEO compensation continues to be substantially in the form of long-term, performance-based equity that vests following a 3­ year performance period 

• Awards are contingent on longer-term financial performance (absolute and relative RORCE), risk assessments, and forfeiture conditions, and have substantial holding requirements 

• 2018 Performance Share Award $1 million less than 2017 

• The HRC and the Board evaluated Mr. Sloan’s performance under the annual incentive performance objective framework , which included their consideration of:

1. of the Company’s strong financial results and steady progress against key goals, including risk management; 
2.  his continued leadership on the Company’s top priority of rebuilding trust; and 
3.  the additional progress required to achieve fully our risk management objectives and the significance of those objectives.
4.  • First annual incentive award since becoming CEO in Oct. 2016