SHORT-TERM INCENTIVES AROUND THE WORLD

2018

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TABL

E O

F C

ON

TEN

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1 MERCER INSIGHTS' GLOBAL PUBLICATIONS

5 INTRODUCTION 7 Report Structure

8 Reading the Report

13 SUMMARY OF KEY FINDINGS15 Incentives by Career Level

19 Incentives by Job Family

27 AMERICAS

28 Regional Summary

32 Executive

34 Management — Manager

36 Management — Supervisor

38 Professional — Senior

40 Professional — Experienced

42 Para-Professional

44 Administration

46 Contact Centre

48 Corporate Affairs

50 Engineering

52 Finance and Accounting

54 Human Resources

56 Information Technology

58 Legal

60 Manufacturing

62 Marketing

64 Quality Assurance

66 Research and Development

68 Sales

448 ABOUT THIS REPORT449 Methodology

460 Glossary

473 About Mercer

70 Sales and Marketing

72 Supply and Logistics

74 Top Management

75 Career Level Trends

81 Long-Term Incentives Trends

83 ASIA PACIFIC

84 Regional Summary

92 Executive

97 Management — Manager

102 Management — Supervisor

107 Professional — Senior

112 Professional — Experienced

117 Para-Professional

122 Administration

128 Contact Centre

134 Corporate Affairs

140 Engineering

146 Finance and Accounting

152 Human Resources

158 Information Technology

164 Legal

168 Manufacturing

174 Marketing

180 Quality Assurance

186 Research and Development

192 Sales

198 Sales and Marketing

204 Supply and Logistics

210 Top Management

213 Career Level Trends

231 Long-Term Incentives Trends

241 EUROPE, MIDDLE EAST, AND AFRICA

242 Regional Summary

250 Executive

257 Management — Manager

264 Management — Supervisor

271 Professional — Senior

278 Professional — Experienced

285 Para-Professional

292 Administration

300 Contact Centre

308 Corporate Affairs

316 Engineering

324 Finance and Accounting

332 Human Resources

340 Information Technology

348 Legal

356 Manufacturing

364 Marketing

372 Quality Assurance

380 Research and Development

388 Sales

396 Sales and Marketing

404 Supply and Logistics

412 Top Management

416 Career Level Trends

434 Long-Term Incentives Trends

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GLO

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PUBL

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HEALTH & BENEFITS

WORKFORCE & CAREERS

HANDBOOKS & GUIDES

Car Benefit Policies Around the World

Global Parental Leave Global Parental Leave Industry Scorecard

LGBT Benefits Around The World

Global Compensation Planning Report

Global Compensation Planning Report

20 Year Look Back

Short-Term Incentives Around the World

HR Guide to Doing Business

HR Atlas Asia Pacific HR Atlas Latin America

Worldwide Benefit & Employment Guidelines

Global Pay Summary International Geographic Salary Differentials

Total Employment Costs Around the World

Workforce Turnover Around the World

Compensation Handbook

Global Mobility Handbook

HR Management Terms

Vacation and Other Leave Around the World

Severance Pay Policies Around the World

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© 2018 Mercer LLC. SHORT-TERM INCENTIVES AROUND THE WORLD — SAMPLE 4

GRADIENT PAY

While trend lines indicate that more and more employees are eligible for STIs, there is still a hierarchy to these compensation schemes. Notably, employers are more likely to offer STIs to individuals at senior career levels (such as professional or management positions) than other employees. Moreover, individuals in some career tracks — notably, those with a direct impact on corporate or office performance — are more likely to be eligible for STIs than others. In practice, this means that sales and production employees are more likely to derive a high proportion of their total compensation from STIs than those serving in administrative or customer service roles.

WHAT’S IN A STI?There are many forms of short-term incentives, but, generally, they are any payment over a 12-month period that is associated with individual, team, and/or corporate performance. Popular types of STI include bonuses, individual incentive plans, and team/unit performance incentives. They are frequently linked to profitability or revenue growth, and achievement of overall company goals determines the size of the company bonus pool. STIs are often capped at a fixed amount or percentage of annual base salary (ABS). By capping these payments, HR and business managers can prevent runaway expenses while achieving higher performance.

INTRODUCTIONMultinational corporations, small firms, and organizations around the world all face the same problem: motivating their employees to contribute to the group’s success. Although base salary serves as compensation for an individual’s time and efforts, many employees may regard this transaction as a given and neglect to make their employer’s objectives their own. In an effort to more closely align individual goals with the organization’s, many employers offer short-term incentives (STIs) that reward employees for performance that is above or beyond their expectations. Although these incentive programs once were reserved for sales personnel and other employees that have a high impact on company success, STIs increasingly are available to all types of employees.

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SHORT-TERM INCENTIVES AROUND THE WORLD — SAMPLE 5

INTRODUCTIONShort-term incentives also are responsive to market conditions. For instance, companies in highly competitive markets are more likely offer generous STIs in order to drive employee and company performance, while those in stable or saturated markets may be less concerned with aggressive growth strategies.

CONSIDERATIONSHR and business managers should consider the following questions when creating a short-term incentive program:

► What types of employees would benefit most from STIs?

► Should I restrict the total value of STIs available to a single employee in one year?

► How should I discern between high-performing and low-performing employees when distributing STIs?

► What factors should I use when determining the impact an individual has on company success?

© 2018 Mercer LLC. SAMPLE

© 2018 Mercer LLC. SHORT-TERM INCENTIVES AROUND THE WORLD — SAMPLE 6

REPORT STRUCTUREINTRODUCTION

The 2018 Short-Term Incentives Around the World publication provides human resource (HR) and business managers with up-to-date information on short-term incentive figures and strategies. This publication offers market-level data on the provision of short-term incentives for six distinct career levels across 16 job families, as well as the target and actual payout for this type of compensation. It also provides regional comparisons and three-year trends to help decision makers understand what the future may hold and anticipate market changes.

The report collates data from 102 markets in 83 countries and offers a unique insight critical to any business looking to devise a sound and competitive compensation program.

The report includes the following sections:

SUMMARY OF KEY FINDINGSThe section serves as an executive summary for those looking for Mercer’s insights and observations; it provides high level trends, market comparisons and other analysis. The following topics are included:

► Incentives by career level

► Incentives by job family

► Historical trends

► Long-term incentives

REGIONAL RESULTSThis section includes a regional summary and market-specific data for those HR professionals looking for more targeted data on an individual topic. It provides market-level data, including the percentage of employees receiving STI and the actual and target STI as a percentage of base salary. This section also offers the following insights for each market:

► Job families that receive highest and lowest STI payout for each career level.

► Detailed STI payout figures by job family and career level.

► Career-level trends over the last three years.

► High level information on long-term incentives can be found at the back of each region section.

ABOUT THIS REPORTThis section delineates the methods used in the report and lists key definitions.

► Methodology includes data sources used to compile this report, currency conversion rates, and other details on calculations and assumptions.

► Glossary provides definitions for many of the terms used throughout this report, as well as other HR related terms.SAMPLE

PERCENTAGE RECEIVING, ACTUAL, AND TARGET, BY CAREER LEVELPROFESSIONAL — SENIOR PROFESSIONAL — EXPERIENCED PARA–PROFESSIONAL

63 13.9 15.4

63 12.7 13.7

38 8.3 9.4

33 6.9 7.7

63 13.3 13.9

37 7.4 8.5

52 9.2 10.5

64 13.3 14.2

50 9.5 10.6

SHORT-TERM INCENTIVES AROUND THE WORLD — GLOBAL© 2018 Mercer LLC.

SUMMARY OF KEY FINDINGS

7

Percentage receiving(% of employees)

Actual (median % ofbase salary)

Target (median % ofbase salary)

AMERICAS

APAC

EMEA

AMERICAS

APAC

EMEA

AMERICAS

APAC

EMEA

INTRODUCTION

READING THIS REPORTThe following pages include tips and guidelines to help navigate the report content. The Summary of Key Findings

includes analysis by career level as well as job family.

Actual and target figures are presented as a percentage of base salary.

This figure indicates the percentage of Professional - Senior level employees in the Americas region who received an incentive

This figure indicates the target actual incentive for a Professional - Senior level employee in the Asia Pacific region

This figure indicates the median actual incentive for a Professional - Senior level employee in the Europe, Middle East, and Africa region

The legend for the graphic can be found in the green shaded area.

SAMPLE DATA

SAMPLE

8SHORT-TERM INCENTIVES AROUND THE WORLD — GLOBAL© 2018 Mercer LLC.

METHODOLOGYThis table presents the percentage of all employees receiving payouts, the actual STI (as a percentage of base salary) received, and target STI (as a percentage of base salary), by career level for each market. Figures in blue represent the highest value and figures in red represent the lowest.

AMERICAS

PERCENTAGE RECEIVING, ACTUAL, AND TARGET, BY CAREER LEVEL

MARKETEXECUTIVE

MANAGEMENT

MANAGER SUPERVISOR/TEAM LEADER

RECEIVING ACTUAL TARGET RECEIVING ACTUAL TARGET RECEIVING ACTUAL TARGET

REGION AVERAGE 68% 23.2% 23.3% 60% 12.9% 13.7% 51% 8.9% 9.6%

ARGENTINA 65% 24.9% 22.3% 59% 13.3% 15.8% 70% 10.1% 11.1%

BRAZIL 78% 23.0% 25.3% 63% 14.3% 14.8% 43% 6.1% 7.6%

CANADA 60% 23.5% 23.4% 54% 12.0% 12.8% 45% 6.2% 7.5%

CHILE 82% 20.7% 22.0% 73% 14.4% 16.3% 72% 10.8% 12.3%

COLOMBIA 62% 30.2% 26.2% 58% 14.9% 16.4% 50% 10.1% 10.7%

COSTA RICA 73% 20.7% 19.9% 66% 14.0% 15.9% 67% 12.3% 10.9%

DOMINICAN REPUBLIC 61% 18.7% 18.3% 63% 11.2% 11.7% 41% 7.5% 7.8%

ECUADOR 62% 17.6% 21.7% 51% 14.3% 14.9% 56% 11.4% 10.4%

GUATEMALA 76% 17.3% 18.0% 64% 12.1% 12.5% 69% 10.2% 13.3%

MEXICO 62% 14.5% 16.2% 55% 9.0% 10.6% 42% 5.7% 6.0%

PANAMA 76% 22.2% 22.8% 68% 11.5% 11.7% 38% 7.8% 8.4%

PERU 83% 30.4% 27.7% 69% 14.4% 14.9% 62% 8.5% 9.3%

PUERTO RICO 46% 18.3% 29.4% 47% 16.6% 19.3% 50% 10.0% 12.8%

UNITED STATES 59% 23.1% 23.2% 54% 15.8% 15.7% 42% 9.3% 9.8%

URUGUAY 73% 21.4% 21.6% 63% 12.2% 14.1% 57% 8.4% 9.6%

VENEZUELA 66% 23.4% 21.9% 59% 13.7% 14.5% 50% 9.3% 8.9%

Notes: The "percentage receiving" represents the amount of employees in that career level who received a short-term incentive. "Actual" and "target" represent the median percentage of base salary.

INTRODUCTION

The first page of each region section provides a quick reference summary table.

Notes on the methodology used for each table or graphic can be found in the gray shaded areas at the bottom of the page. Additional information on Methodology can be found in the About This Report section.

Throughout the report, data relating to the percentage of employees receiving a STI are colored purple. “Actual” data are orange and “Target” data are blue.

SAMPLE DATA

SAMPLE

METHODOLOGYThis table presents the job family with the highest and lowest percentage of all employees receiving payouts, actual STI (as a percentage of base salary) received, and target STI (as a percentage of base salary) for each career level. The actual and target STI amounts represent a percentage of base salary.

SHORT-TERM INCENTIVES AROUND THE WORLD — GLOBAL 9© 2018 Mercer LLC. 9

SUMMARY OF PERCENTAGE RECEIVING, ACTUAL, AND TARGET, BY CAREER LEVEL AND JOB FAMILY

EXECUTIVE

MARKET HIGHEST AND LOWEST PERCENTAGE RECEIVING

HIGHEST AND LOWEST ACTUAL STI PERCENTAGE

HIGHEST AND LOWEST TARGET STI PERCENTAGE

ARGENTINAHuman Resources 84% Finance and Accounting 11.2% Finance and Accounting 12.7%

Quality Assurance 31% Quality Assurance 8.0% Contact Center 8.3%

BRAZILAdministration 41% Contact Center 7.1% Supply and Logistics 7.4%

Supply and Logistics 24% Human Resources 2.4% Human Resources 3.3%

CANADAAdministration 36% Finance and Accounting 5.1% Legal 6.5%

Supply and Logistics 3% Quality Assurance 2.6% Quality Assurance 3.0%

CHILEEngineering 83% Supply and Logistics 13.1% Contact Center 12.5%

Sales 45% Human Resources 6.6% Legal 5.0%

COLOMBIAContact Center 53% Supply and Logistics 9.8% Manufacturing 10.0%

Sales 16% Sales 6.3% Sales 7.9%

COSTA RICAQuality Assurance 72% Manufacturing 11.2% Sales 14.7%

Human Resources 18% Human Resources 6.0% Finance and Accounting 9.6%

DOMINICAN REPUBLICSupply and Logistics 53% Human Resources 7.1% Sales 6.6%

Human Resources 15% Finance and Accounting 3.2% Manufacturing 3.7%

INTRODUCTION

AMERICAS

The top row within each market indicates the job family with the highest percentage and the bottom row indicates the lowest.

Definitions for each career level and job family can be found in the Glossary which is part of the About This Report section.

SAMPLE DATA

This table provides a summary of the job families with the highest and lowest percentages for each type of data.

SAMPLE

10SHORT-TERM INCENTIVES AROUND THE WORLD — GLOBAL© 2018 Mercer LLC.

METHODOLOGYThis table presents the percentage of all employees receiving payouts, the actual STI (as a percentage of base salary) received, and target STI (as a percentage of base salary), by career level for each market. Figures in blue represent the highest value and figures in red represent the lowest.

PERCENTAGE RECEIVING, ACTUAL, AND TARGET, BY CAREER LEVEL

MARKETEXECUTIVE

MANAGEMENT

MANAGER SUPERVISOR/TEAM LEADER

RECEIVING ACTUAL TARGET RECEIVING ACTUAL TARGET RECEIVING ACTUAL TARGET

ARGENTINA 61% 20.6% 23.6% 100% 12.2% 14.1% 51% 10.5% 11.5%

BRAZIL 68% 18.3% 20.3% 81% 12.9% 13.2% 94% 12.3% 14.2%

CANADA 67% 13.6% 18.0% 65% 13.5% 14.2% – – –

CHILE 80% 24.9% 24.7% 82% 17.6% 18.1% 82% 16.2% 16.2%

COLOMBIA – – – – – – – – –

COSTA RICA – – – 78% 15.1% 15.9% 92% 17.1% 16.0%

DOMINICAN REPUBLIC – – – 67% 18.9% 15.3% – – 16.2%

ECUADOR – – – 93% 30.9% 25.1% 100% 34.4% 41.0%

GUATEMALA – – – 89% 17.3% 13.8% 81% 5.6% 8.5%MEXICO 85% 26.5% 22.6% 79% 18.4% 17.2% – – –

PANAMA 100% 29.4% 26.1% 88% 18.6% 18.3% 95% 26.4% 26.8%

PERU – – – 100% 24.2% 20.5% – – –

PUERTO RICO 85% 23.7% 22.0% 88% 23.7% 22.4% 95% 17.0% 16.7%

UNITED STATES 80% 15.3% 21.7% 76% 16.3% 15.4% – – –

URUGUAY 85% 20.0% 20.0% 88% 16.3% 17.0% 81% 14.6% 15.2%

VENEZUELA – – – 13% 11.2% 17.5% – – –

Notes: The "percentage receiving" represents the amount of employees in that career level who received a short-term incentive. "Actual" and "target" represent the median percentage of base salary.

ADMINISTRATION

INTRODUCTION

AMERICAS This section provides detailed data by job family and career level.

A dash indicates that insufficient data are available to report the statistic.

SAMPLE DATA

The figures in the "Actual" and "Target" columns represent a percentage of base salary.

The number in blue is the highest in the column.

The number in red is the lowest in the column.

The figure in this column is indicating the prevalence of STI for each market and career level; i.e., the percentage of employees receiving an incentive.

SAMPLE

11SHORT-TERM INCENTIVES AROUND THE WORLD — GLOBAL© 2018 Mercer LLC.

METHODOLOGYThis table presents the year-over-year trends for STI information by career level. The first three columns for each career level provide the percentage of employees receiving STI for each of the listed years. Each year refers to the year that data were published. The % change column indicates the difference in the receiving percentage of STI from 2015 to 2017.

MARKETEXECUTIVE

MANAGEMENT

MANAGER SUPERVISOR/TEAM LEADER

2015 2016 2017 % CHANGE 2015 2016 2017 % CHANGE 2015 2016 2017 % CHANGE

ARGENTINA 62 70 60 -2% 54 54 44 -10% 51 54 33 -18%

BRAZIL 60 54 71 11% 49 50 74 25% 63 53 7 7 14%

CANADA – – 54 – – – 49 – – – 38 –

CHILE 83 84 81 -2% 76 74 75 -1% 87 84 82 -5%

COLOMBIA – – – – – – 71 – – – 100 –

COSTA RICA – – 70 – – – 72 – – – 75 –

DOMINICAN REPUBLIC 89 80 100 11% 75 65 61 -14% 82 42 45 -37%

ECUADOR – – 80 – – – 92 – – – 96 –

GUATEMALA – 100 – – 90 91 80 -10% 92 88 83 -9%

MEXICO 80 82 84 4% 7 7 70 69 -8% 74 7 7 75 1%

PANAMA 95 93 93 -2% 85 86 84 -1% 95 91 86 -9%

PERU – – 73 – 93 93 85 -8% 100 99 96 -4%

PUERTO RICO 95 93 92 -3% 84 86 83 -1% 88 86 80 -8%

UNITED STATES 100 67 79 -21% 7 7 81 75 -2% 93 86 87 -6%

URUGUAY 84 87 85 1% 83 80 80 -3% 85 84 82 -3%

VENEZUELA 78 94 92 14% 7 7 85 88 11% 88 90 93 5%

PERCENTAGE OF EMPLOYEES RECEIVING SHORT-TERM INCENTIVES, 2015–2017

CAREER LEVEL TRENDS

INTRODUCTION

AMERICAS

SAMPLE DATAThree year's of data are provided for each market and career level as an indication of recent changes or stability.

The shaded columns on this page are purple, which indicates the amounts relate to the percentage of employees receiving STI.

The % change column provides the difference between 2015 and 2017 figures.

SAMPLE

REG

ION

SAMPLE

© 2018 Mercer LLC. SHORT-TERM INCENTIVES AROUND THE WORLD — SAMPLE 13

REGION

REGIONAL SUMMARY

The analysis and results in this report are based on the data from the companies surveyed. In some cases, data do not cover full three years, or is sparse for some positions or career levels.

The following tables and charts provide data on eligibility (represented by percentage of employees receiving incentives) and incentive award levels (incentive as a percentage of base salary) for employees in different career levels in the Americas.

Eligibility to receive STIs varies with career level; a higher percentage of employees in the executive level (50%) are eligible to receive incentives as compared to those at the management level. In most American markets, the actual (median % of base salary) incentives received by executives is more than five times higher than para-professionals.

The following chart presents the combined data of the overall prevalence of incentives and incentives as a percentage of annual base salary for employees in the Americas.

STI PERCENTAGE RECEIVING, ACTUAL, AND TARGET, BY CAREER LEVEL

Percentage receiving (% of employees)

Actual(median % of base salary)

Target(median % of base salary)

EXECUTIVE MANAGEMENT — MANAGER

MANAGEMENT — SUPERVISOR

PROFESSIONAL — SENIOR

PROFESSIONAL — EXPERIENCED

PARA-PROFESSIONAL

50 50 50 50 50 5050 50 50 50 50 5050 50 50 50 50 50

SAMPLE

SHORT-TERM INCENTIVES AROUND THE WORLD — SAMPLE 14

REGIONIncentive eligibility and incentive payouts vary across countries.This section presents the information on annual incentives for each market further refined by career levels and job family.

KEY FINDINGS ► Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam.

► Sed ut perspiciatis unde omnis iste natus error sit voluptatem accusantium doloremque laudantium, totam rem aperiam, eaque ipsa quae ab illo inventore veritatis.

► Sed quia consequuntur magni dolores eos qui ratione voluptatem sequi nesciunt. Neque porro quisquam est, qui dolorem ipsum quia dolor sit amet, consectetur.

© 2018 Mercer LLC. SAMPLE

15SHORT-TERM INCENTIVES AROUND THE WORLD — GLOBAL© 2018 Mercer LLC.

METHODOLOGYThis table presents the percentage of all employees receiving payouts, the actual STI (as a percentage of base salary) received, and target STI (as a percentage of base salary), by career level for each market. Figures in blue represent the highest value and figures in red represent the lowest.

REGIONPERCENTAGE RECEIVING, ACTUAL, AND TARGET, BY CAREER LEVEL

MARKETEXECUTIVE

MANAGEMENT

MANAGER SUPERVISOR/TEAM LEADER

RECEIVING ACTUAL TARGET RECEIVING ACTUAL TARGET RECEIVING ACTUAL TARGET

REGION AVERAGE 50% 40.0% 30.0% 50% 40.0% 30.0% 50% 40.0% 30.0%

ARGENTINA 50% 40.0% 30.0% 50% 40.0% 30.0% 50% 40.0% 30.0%

BRAZIL 50% 40.0% 30.0% 50% 40.0% 30.0% 50% 40.0% 30.0%

CANADA 50% 40.0% 30.0% 50% 40.0% 30.0% 50% 40.0% 30.0%

CHILE 50% 40.0% 30.0% 50% 40.0% 30.0% 50% 40.0% 30.0%

COLOMBIA 40% 40.0% 30.0% 50% 40.0% 30.0% 50% 40.0% 30.0%

COSTA RICA 50% 40.0% 30.0% 50% 40.0% 30.0% 50% 40.0% 30.0%

DOMINICAN REPUBLIC 50% 40.0% 30.0% 50% 40.0% 30.0% 50% 40.0% 30.0%

ECUADOR 98% 40.0% 30.0% 50% 40.0% 30.0% 50% 40.0% 30.0%

GUATEMALA 50% 40.0% 30.0% 50% 40.0% 30.0% 50% 40.0% 30.0%

MEXICO 50% 40.0% 30.0% 50% 40.0% 30.0% 50% 40.0% 30.0%

PANAMA 50% 40.0% 30.0% 50% 40.0% 30.0% 50% 40.0% 30.0%

PERU 50% 40.0% 30.0% 50% 40.0% 30.0% 50% 40.0% 30.0%

PUERTO RICO 50% 40.0% 30.0% 50% 40.0% 30.0% 50% 40.0% 30.0%

UNITED STATES 50% 40.0% 30.0% 50% 40.0% 30.0% 50% 40.0% 30.0%

URUGUAY 50% 40.0% 30.0% 50% 40.0% 30.0% 50% 40.0% 30.0%

Notes: The "percentage receiving" represents the amount of employees in that career level who received a short-term incentive. "Actual" and "target" represent the median percentage of base salary.

SAMPLE

16SHORT-TERM INCENTIVES AROUND THE WORLD — GLOBAL© 2018 Mercer LLC.

METHODOLOGYThis table presents the percentage of all employees receiving payouts, the actual STI (as a percentage of base salary) received, and target STI (as a percentage of base salary), by career level for each market. Figures in blue represent the highest value and figures in red represent the lowest.

REGIONPERCENTAGE RECEIVING, ACTUAL, AND TARGET, BY CAREER LEVEL, CONTINUED

MARKET

PROFESSIONALPARA-PROFESSIONAL

SENIOR EXPERIENCED

RECEIVING ACTUAL TARGET RECEIVING ACTUAL TARGET RECEIVING ACTUAL TARGET

REGION AVERAGE 50% 40.0% 30.0% 50% 40.0% 30.0% 50% 40.0% 30.0%

ARGENTINA 50% 40.0% 30.0% 50% 40.0% 30.0% 50% 40.0% 30.0%

BRAZIL 50% 40.0% 30.0% 50% 40.0% 30.0% 50% 40.0% 30.0%

CANADA 50% 40.0% 30.0% 50% 40.0% 30.0% 50% 40.0% 30.0%

CHILE 50% 40.0% 30.0% 50% 40.0% 30.0% 50% 40.0% 30.0%

COLOMBIA 40% 40.0% 30.0% 50% 40.0% 30.0% 50% 40.0% 30.0%

COSTA RICA 50% 40.0% 30.0% 50% 40.0% 30.0% 50% 40.0% 30.0%

DOMINICAN REPUBLIC 50% 40.0% 30.0% 50% 40.0% 30.0% 50% 40.0% 30.0%

ECUADOR 98% 40.0% 30.0% 50% 40.0% 30.0% 50% 40.0% 30.0%

GUATEMALA 50% 40.0% 30.0% 50% 40.0% 30.0% 50% 40.0% 30.0%

MEXICO 50% 40.0% 30.0% 50% 40.0% 30.0% 50% 40.0% 30.0%

PANAMA 50% 40.0% 30.0% 50% 40.0% 30.0% 50% 40.0% 30.0%

PERU 50% 40.0% 30.0% 50% 40.0% 30.0% 50% 40.0% 30.0%

PUERTO RICO 50% 40.0% 30.0% 50% 40.0% 30.0% 50% 40.0% 30.0%

UNITED STATES 50% 40.0% 30.0% 50% 40.0% 30.0% 50% 40.0% 30.0%

URUGUAY 50% 40.0% 30.0% 50% 40.0% 30.0% 50% 40.0% 30.0%

Notes: The "percentage receiving" represents the amount of employees in that career level who received a short-term incentive. "Actual" and "target" represent the median percentage of base salary.

SAMPLE

METHODOLOGYThis table presents the job family with the highest and lowest percentage of all employees receiving payouts, actual STI (as a percentage of base salary) received, and target STI (as a percentage of base salary) for each career level. The actual and target STI amounts represent a percentage of base salary.

SHORT-TERM INCENTIVES AROUND THE WORLD — GLOBAL 17© 2018 Mercer LLC. 17

SUMMARY OF PERCENTAGE RECEIVING, ACTUAL, AND TARGET, BY CAREER LEVEL AND JOB FAMILY

CAREER LEVEL

MARKET HIGHEST AND LOWEST PERCENTAGE RECEIVING

HIGHEST AND LOWEST ACTUAL STI PERCENTAGE

HIGHEST AND LOWEST TARGET STI PERCENTAGE

ARGENTINAManufacturing 50% Top Management 50.0% Top Management 50.4%

Corporate Affairs 40% Sales and Marketing 40.0% Supply and Logistics 30.9%

BRAZILManufacturing 50% Top Management 50.0% Top Management 50.4%

Corporate Affairs 40% Sales and Marketing 40.0% Supply and Logistics 30.9%

CANADAManufacturing 50% Top Management 50.0% Top Management 50.4%

Corporate Affairs 40% Sales and Marketing 40.0% Supply and Logistics 30.9%

CHILEManufacturing 50% Top Management 50.0% Top Management 50.4%

Corporate Affairs 40% Sales and Marketing 40.0% Supply and Logistics 30.9%

COLOMBIAManufacturing 50% Top Management 50.0% Top Management 50.4%

Corporate Affairs 40% Sales and Marketing 40.0% Supply and Logistics 30.9%

COSTA RICA– – – – Top Management 50.4%

– – – – Supply and Logistics 30.9%

DOMINICAN REPUBLIC– – Top Management 50.0% – –

– – Sales and Marketing 40.0% – –

ECUADORManufacturing 50% – – – –

Corporate Affairs 40% – – – –

REGION

SAMPLE

18SHORT-TERM INCENTIVES AROUND THE WORLD — GLOBAL© 2018 Mercer LLC.

METHODOLOGYThis table presents the percentage of all employees receiving payouts, the actual STI (as a percentage of base salary) received, and target STI (as a percentage of base salary), by career level for each market. Figures in blue represent the highest value and figures in red represent the lowest.

PERCENTAGE RECEIVING, ACTUAL, AND TARGET, BY CAREER LEVEL

MARKETEXECUTIVE

MANAGEMENT

MANAGER SUPERVISOR/TEAM LEADER

RECEIVING ACTUAL TARGET RECEIVING ACTUAL TARGET RECEIVING ACTUAL TARGET

ARGENTINA – 40.0% 30.0% 51% 40.0% 30.0% – – –

BRAZIL – 40.0% 30.0% 50% 40.0% 30.0% 50% – 30.0%

CANADA – 40.0% 30.0% 50% 40.0% 30.0% 50% – 30.0%

CHILE – 40.0% 30.0% 50% 40.1% 30.0% 50% – 30.0%

COLOMBIA 50% 40.0% 30.0% 50% 40.0% 30.0% 50% 40.0% 30.0%

COSTA RICA 50% 40.0% 30.0% 50% 40.0% 30.0% 50% 40.0% 30.0%

DOMINICAN REPUBLIC 50% 40.0% 30.0% 50% 40.0% 30.0% 50% 40.0% 30.0%

ECUADOR 50% 40.0% 30.0% 50% 40.0% 30.0% 50% 40.0% 30.0%

GUATEMALA 50% 40.0% 30.0% 50% 40.0% 30.0% 50% 40.0% 30.0%

MEXICO – 40.0% 30.0% 50% 40.0% 30.0% 50% 40.0% 30.0%

PANAMA – 40.0% 30.0% 50% 40.0% 30.0% 50% 40.0% 30.0%

PERU – – 30.0% 50% 40.0% 30.0% 50% 40.0% 30.0%

PUERTO RICO – – 30.0% 50% 40.0% 30.0% 50% 40.0% 30.0%

UNITED STATES – – 30.0% 50% 40.0% 30.0% 50% 40.0% 30.0%

URUGUAY – – – 50% 40.0% 30.0% 50% 40.0% 30.0%

VENEZUELA – – – 49% 40.0% 30.0% – – –

Notes: The "percentage receiving" represents the amount of employees in that career level who received a short-term incentive. "Actual" and "target" represent the median percentage of base salary.

JOB FAMILYREGION

SAMPLE

19SHORT-TERM INCENTIVES AROUND THE WORLD — GLOBAL© 2018 Mercer LLC.

METHODOLOGYThis table presents the percentage of all employees receiving payouts, the actual STI (as a percentage of base salary) received, and target STI (as a percentage of base salary), by career level for each market. Figures in blue represent the highest value and figures in red represent the lowest.

PERCENTAGE RECEIVING, ACTUAL, AND TARGET, BY CAREER LEVEL AND JOB FAMILY, CONTINUED

MARKET

PROFESSIONALPARA-PROFESSIONAL

SENIOR EXPERIENCED

RECEIVING ACTUAL TARGET RECEIVING ACTUAL TARGET RECEIVING ACTUAL TARGET

ARGENTINA – 40.0% 30.0% 51% 40.0% 30.0% – – –

BRAZIL – 40.0% 30.0% 50% 40.0% 30.0% 50% – 30.0%

CANADA – 40.0% 30.0% 50% 40.0% 30.0% 50% – 30.0%

CHILE – 40.0% 30.0% 50% 40.1% 30.0% 50% – 30.0%

COLOMBIA 50% 40.0% 30.0% 50% 40.0% 30.0% 50% 40.0% 30.0%

COSTA RICA 50% 40.0% 30.0% 50% 40.0% 30.0% 50% 40.0% 30.0%

DOMINICAN REPUBLIC 50% 40.0% 30.0% 50% 40.0% 30.0% 50% 40.0% 30.0%

ECUADOR 50% 40.0% 30.0% 50% 40.0% 30.0% 50% 40.0% 30.0%

GUATEMALA 50% 40.0% 30.0% 50% 40.0% 30.0% 50% 40.0% 30.0%

MEXICO – 40.0% 30.0% 50% 40.0% 30.0% 50% 40.0% 30.0%

PANAMA – 40.0% 30.0% 50% 40.0% 30.0% 50% 40.0% 30.0%

PERU – – 30.0% 50% 40.0% 30.0% 50% 40.0% 30.0%

PUERTO RICO – – 30.0% 50% 40.0% 30.0% 50% 40.0% 30.0%

UNITED STATES – – 30.0% 50% 40.0% 30.0% 50% 40.0% 30.0%

URUGUAY – – – 50% 40.0% 30.0% 50% 40.0% 30.0%

VENEZUELA – – – 49% 40.0% 30.0% – – –

REGION

JOB FAMILY

Notes: The "percentage receiving" represents the amount of employees in that career level who received a short-term incentive. "Actual" and "target" represent the median percentage of base salary. SAMPLE

20SHORT-TERM INCENTIVES AROUND THE WORLD — GLOBAL© 2018 Mercer LLC.

METHODOLOGYThis table presents the year-over-year trends for STI information by career level. The first three columns for each career level provide the percentage of employees receiving STI for each of the listed years. Each year refers to the year that data were published. The % change column indicates the difference in the receiving percentage of STI from 2015 to 2017.

MARKETEXECUTIVE

MANAGEMENT

MANAGER SUPERVISOR/TEAM LEADER

2015 2016 2017 % CHANGE 2015 2016 2017 % CHANGE 2015 2016 2017 % CHANGE

ARGENTINA 48 50 50 4% 40 40 40 0% 30 30 30 0%

BRAZIL – 50 50 – 40 40 40 0% 30 30 30 0%

CANADA 50 50 50 0% 40 40 40 0% 30 30 30 0%

CHILE 50 50 50 0% 40 40 40 0% 30 30 30 0%

COLOMBIA 50 50 50 0% – 40 40 – 30 30 30 0%

COSTA RICA 50 50 50 0% 40 40 40 0% 30 30 30 0%

DOMINICAN REPUBLIC 50 50 50 0% 40 40 40 0% 30 30 30 0%

ECUADOR 50 50 50 0% 40 40 40 0% – 30 30 –

GUATEMALA 50 50 50 0% 40 40 40 0% 30 30 30 0%

MEXICO 50 50 50 0% 40 40 40 0% 30 30 30 0%

PANAMA 50 50 50 0% 40 40 40 0% 30 30 30 0%

PERU 50 50 50 0% 40 40 40 0% 30 30 30 0%

PUERTO RICO 50 50 50 0% 40 40 40 0% 30 30 30 0%

UNITED STATES – 50 50 – – 40 40 – – 30 30 –

URUGUAY 50 50 50 0% 40 40 40 0% 30 30 30 0%

VENEZUELA 50 50 50 0% 40 40 40 0% 30 30 30 0%

REGION

PERCENTAGE OF EMPLOYEES RECEIVING SHORT-TERM INCENTIVES, 2015–2017

CAREER LEVEL TRENDS

SAMPLE

21SHORT-TERM INCENTIVES AROUND THE WORLD — GLOBAL© 2018 Mercer LLC.

METHODOLOGYThis table presents the year-over-year trends for STI information by career level. The first three columns for each career level provide the percentage of employees receiving STI for each of the listed years. Each year refers to the year that data were published. The % change column indicates the difference in the receiving percentage of STI from 2015 to 2017.

REGION

MARKET

PROFESSIONALPARA-PROFESSIONAL

SENIOR EXPERIENCED

2015 2016 2017 % CHANGE 2015 2016 2017 % CHANGE 2015 2016 2017 % CHANGE

ARGENTINA 48 50 50 4% 40 40 40 0% 30 30 30 0%

BRAZIL – 50 50 – 40 40 40 0% 30 30 30 0%

CANADA 50 50 50 0% 40 40 40 0% 30 30 30 0%

CHILE 50 50 50 0% 40 40 40 0% 30 30 30 0%

COLOMBIA 50 50 50 0% – 40 40 – 30 30 30 0%

COSTA RICA 50 50 50 0% 40 40 40 0% 30 30 30 0%

DOMINICAN REPUBLIC 50 50 50 0% 40 40 40 0% 30 30 30 0%

ECUADOR 50 50 50 0% 40 40 40 0% – 30 30 –

GUATEMALA 50 50 50 0% 40 40 40 0% 30 30 30 0%

MEXICO 50 50 50 0% 40 40 40 0% 30 30 30 0%

PANAMA 50 50 50 0% 40 40 40 0% 30 30 30 0%

PERU 50 50 50 0% 40 40 40 0% 30 30 30 0%

PUERTO RICO 50 50 50 0% 40 40 40 0% 30 30 30 0%

UNITED STATES – 50 50 – – 40 40 – – 30 30 –

URUGUAY 50 50 50 0% 40 40 40 0% 30 30 30 0%

VENEZUELA 50 50 50 0% 40 40 40 0% 30 30 30 0%

CAREER LEVEL TRENDSPERCENTAGE OF EMPLOYEES RECEIVING SHORT-TERM INCENTIVES, 2015–2017, CONTINUED

SAMPLE

22SHORT-TERM INCENTIVES AROUND THE WORLD — GLOBAL© 2018 Mercer LLC.

METHODOLOGYThis table presents the year-over-year trends for STI information by career level. The first three columns for each career level provide the actual STI (as a percentage of base salary) for each of the listed years. Each year refers to the year that data were published; actual STI may relate to the previous year's performance period. The % change column indicates the difference in the actual percentage of STI from 2015 to 2017.

MARKETEXECUTIVE

MANAGEMENT

MANAGER SUPERVISOR/TEAM LEADER

2015 2016 2017 % CHANGE 2015 2016 2017 % CHANGE 2015 2016 2017 % CHANGE

ARGENTINA 48.0 50.0 50.0 4% 40.0 40.0 40.0 0% 40.0 40.0 40.0 0%

BRAZIL 50.0 50.0 50.0 0% 40.0 40.0 40.0 0% 40.0 40.0 40.0 0%

CANADA 50.0 50.0 50.0 0% 40.0 40.0 40.0 0% 40.0 40.0 40.0 0%

CHILE 50.0 50.0 50.0 0% 40.0 40.0 40.0 0% 40.0 40.0 40.0 0%

COLOMBIA 50.0 50.0 50.0 0% 40.0 40.0 40.0 0% 40.0 40.0 40.0 0%

COSTA RICA 50.0 50.0 50.0 0% 40.0 40.0 40.0 0% 40.0 40.0 40.0 0%

DOMINICAN REPUBLIC 50.0 50.0 50.0 0% 40.0 40.0 40.0 0% 40.0 40.0 40.0 0%

ECUADOR 50.0 50.0 50.0 0% 40.0 40.0 40.0 0% 40.0 40.0 40.0 0%

GUATEMALA 50.0 50.0 50.0 0% 40.0 40.0 40.0 0% 40.0 40.0 40.0 0%

MEXICO 50.0 50.0 50.0 0% 40.0 40.0 40.0 0% 40.0 40.0 40.0 0%

PANAMA 50.0 50.0 50.0 0% 40.0 40.0 40.0 0% 40.0 40.0 40.0 0%

PERU 50.0 50.0 50.0 0% 40.0 40.0 40.0 0% 40.0 40.0 40.0 0%

PUERTO RICO 50.0 50.0 50.0 0% 40.0 40.0 40.0 0% 40.0 40.0 40.0 0%

UNITED STATES 50.0 50.0 50.0 0% 40.0 40.0 40.0 0% 40.0 40.0 40.0 0%

URUGUAY 50.0 50.0 50.0 0% 40.0 40.0 40.0 0% 40.0 40.0 40.0 0%

VENEZUELA 50.0 50.0 50.0 0% 40.0 40.0 40.0 0% 40.0 40.0 40.0 0%

REGION

PERCENTAGE OF EMPLOYEES ACTUAL SHORT-TERM INCENTIVES, 2015–2017

CAREER LEVEL TRENDS

SAMPLE

23SHORT-TERM INCENTIVES AROUND THE WORLD — GLOBAL© 2018 Mercer LLC.

METHODOLOGYThis table presents the year-over-year trends for STI information by career level. The first three columns for each career level provide the actual STI (as a percentage of base salary) for each of the listed years. Each year refers to the year that data were published; actual STI may relate to the previous year's performance period. The % change column indicates the difference in the actual percentage of STI from 2015 to 2017.

MARKET

PROFESSIONALPARA-PROFESSIONAL

SENIOR EXPERIENCED

2015 2016 2017 % CHANGE 2015 2016 2017 % CHANGE 2015 2016 2017 % CHANGE

ARGENTINA 48.0 50.0 50.0 4% 40.0 40.0 40.0 0% 40.0 40.0 40.0 0%

BRAZIL 50.0 50.0 50.0 0% 40.0 40.0 40.0 0% 40.0 40.0 40.0 0%

CANADA 50.0 50.0 50.0 0% 40.0 40.0 40.0 0% 40.0 40.0 40.0 0%

CHILE 50.0 50.0 50.0 0% 40.0 40.0 40.0 0% 40.0 40.0 40.0 0%

COLOMBIA 50.0 50.0 50.0 0% 40.0 40.0 40.0 0% 40.0 40.0 40.0 0%

COSTA RICA 50.0 50.0 50.0 0% 40.0 40.0 40.0 0% 40.0 40.0 40.0 0%

DOMINICAN REPUBLIC 50.0 50.0 50.0 0% 40.0 40.0 40.0 0% 40.0 40.0 40.0 0%

ECUADOR 50.0 50.0 50.0 0% 40.0 40.0 40.0 0% 40.0 40.0 40.0 0%

GUATEMALA 50.0 50.0 50.0 0% 40.0 40.0 40.0 0% 40.0 40.0 40.0 0%

MEXICO 50.0 50.0 50.0 0% 40.0 40.0 40.0 0% 40.0 40.0 40.0 0%

PANAMA 50.0 50.0 50.0 0% 40.0 40.0 40.0 0% 40.0 40.0 40.0 0%

PERU 50.0 50.0 50.0 0% 40.0 40.0 40.0 0% 40.0 40.0 40.0 0%

PUERTO RICO 50.0 50.0 50.0 0% 40.0 40.0 40.0 0% 40.0 40.0 40.0 0%

UNITED STATES 50.0 50.0 50.0 0% 40.0 40.0 40.0 0% 40.0 40.0 40.0 0%

URUGUAY 50.0 50.0 50.0 0% 40.0 40.0 40.0 0% 40.0 40.0 40.0 0%

VENEZUELA 50.0 50.0 50.0 0% 40.0 40.0 40.0 0% 40.0 40.0 40.0 0%

PERCENTAGE OF EMPLOYEES ACTUAL SHORT-TERM INCENTIVES, 2015–2017, CONTINUED

REGION

CAREER LEVEL TRENDS

SAMPLE

24SHORT-TERM INCENTIVES AROUND THE WORLD — GLOBAL© 2018 Mercer LLC.

METHODOLOGYThis table presents the year-over-year trends for STI information by career level. The first three columns for each career level provide the target STI (as a percentage of base salary) for each of the listed years. Each year refers to the year that data were published. The % change column indicates the difference in the target percentage of STI from 2015 to 2017.

MARKETEXECUTIVE

MANAGEMENT

MANAGER SUPERVISOR/TEAM LEADER

2015 2016 2017 % CHANGE 2015 2016 2017 % CHANGE 2015 2016 2017 % CHANGE

ARGENTINA 48.0 50.0 50.0 4% 40.0 40.0 40.0 0% 30.0 30.0 30.0 0%

BRAZIL 50.0 50.0 50.0 0% 40.0 40.0 40.0 0% 30.0 30.0 30.0 0%

CANADA 50.0 50.0 50.0 0% 40.0 40.0 40.0 0% 30.0 30.0 30.0 0%

CHILE 50.0 50.0 50.0 0% 40.0 40.0 40.0 0% 30.0 30.0 30.0 0%

COLOMBIA 50.0 50.0 50.0 0% 40.0 40.0 40.0 0% 30.0 30.0 30.0 0%

COSTA RICA 50.0 50.0 50.0 0% 40.0 40.0 40.0 0% 30.0 30.0 30.0 0%

DOMINICAN REPUBLIC 50.0 50.0 50.0 0% 40.0 40.0 40.0 0% 30.0 30.0 30.0 0%

ECUADOR 50.0 50.0 50.0 0% 40.0 40.0 40.0 0% 30.0 30.0 30.0 0%

GUATEMALA 50.0 50.0 50.0 0% 40.0 40.0 40.0 0% 30.0 30.0 30.0 0%

MEXICO 50.0 50.0 50.0 0% 40.0 40.0 40.0 0% 30.0 30.0 30.0 0%

PANAMA 50.0 50.0 50.0 0% 40.0 40.0 40.0 0% 30.0 30.0 30.0 0%

PERU 50.0 50.0 50.0 0% 40.0 40.0 40.0 0% 30.0 30.0 30.0 0%

PUERTO RICO 50.0 50.0 50.0 0% 40.0 40.0 40.0 0% 30.0 30.0 30.0 0%

UNITED STATES 50.0 50.0 50.0 0% 40.0 40.0 40.0 0% 30.0 30.0 30.0 0%

URUGUAY 50.0 50.0 50.0 0% 40.0 40.0 40.0 0% 30.0 30.0 30.0 0%

VENEZUELA 50.0 50.0 50.0 0% 40.0 40.0 40.0 0% 30.0 30.0 30.0 0%

PERCENTAGE OF EMPLOYEES TARGET SHORT-TERM INCENTIVES, 2015–2017

REGION

CAREER LEVEL TRENDS

SAMPLE

25SHORT-TERM INCENTIVES AROUND THE WORLD — GLOBAL© 2018 Mercer LLC.

METHODOLOGYThis table presents the year-over-year trends for STI information by career level. The first three columns for each career level provide the target STI (as a percentage of base salary) for each of the listed years. Each year refers to the year that data were published. The % change column indicates the difference in the target percentage of STI from 2015 to 2017.

MARKET

PROFESSIONALPARA-PROFESSIONAL

SENIOR EXPERIENCED

2015 2016 2017 % CHANGE 2015 2016 2017 % CHANGE 2015 2016 2017 % CHANGE

ARGENTINA 48.0 50.0 50.0 4% 40.0 40.0 40.0 0% 30.0 30.0 30.0 0%

BRAZIL 50.0 50.0 50.0 0% 40.0 40.0 40.0 0% 30.0 30.0 30.0 0%

CANADA 50.0 50.0 50.0 0% 40.0 40.0 40.0 0% 30.0 30.0 30.0 0%

CHILE 50.0 50.0 50.0 0% 40.0 40.0 40.0 0% 30.0 30.0 30.0 0%

COLOMBIA 50.0 50.0 50.0 0% 40.0 40.0 40.0 0% 30.0 30.0 30.0 0%

COSTA RICA 50.0 50.0 50.0 0% 40.0 40.0 40.0 0% 30.0 30.0 30.0 0%

DOMINICAN REPUBLIC 50.0 50.0 50.0 0% 40.0 40.0 40.0 0% 30.0 30.0 30.0 0%

ECUADOR 50.0 50.0 50.0 0% 40.0 40.0 40.0 0% 30.0 30.0 30.0 0%

GUATEMALA 50.0 50.0 50.0 0% 40.0 40.0 40.0 0% 30.0 30.0 30.0 0%

MEXICO 50.0 50.0 50.0 0% 40.0 40.0 40.0 0% 30.0 30.0 30.0 0%

PANAMA 50.0 50.0 50.0 0% 40.0 40.0 40.0 0% 30.0 30.0 30.0 0%

PERU 50.0 50.0 50.0 0% 40.0 40.0 40.0 0% 30.0 30.0 30.0 0%

PUERTO RICO 50.0 50.0 50.0 0% 40.0 40.0 40.0 0% 30.0 30.0 30.0 0%

UNITED STATES 50.0 50.0 50.0 0% 40.0 40.0 40.0 0% 30.0 30.0 30.0 0%

URUGUAY 50.0 50.0 50.0 0% 40.0 40.0 40.0 0% 30.0 30.0 30.0 0%

VENEZUELA 50.0 50.0 50.0 0% 40.0 40.0 40.0 0% 30.0 30.0 30.0 0%

PERCENTAGE OF EMPLOYEES TARGET SHORT-TERM INCENTIVES, 2015–2017, CONTINUED

REGION

CAREER LEVEL TRENDS

SAMPLE

SHORT-TERM INCENTIVES AROUND THE WORLD — SAMPLE 26© 2018 Mercer LLC.

LONG-TERM INCENTIVES TRENDSThe developed markets of North America have a relatively higher prevalence of LTIs, whereas Latin American organizations are only aligning executive compensation with stock performance. This trend is most clear in the prevalence rates of LTI plans in these countries. However, in the years after the economic crisis, there seems to be a shift toward introducing LTI-based remuneration.

Foreign investors, who are used to stronger alignments between compensation and business results, are increasingly demanding similar standards in emerging markets.

KEY FINDINGS ► Adipisci velit, sed quia non numquam eius modi tempora incidunt ut labore et dolore magnam aliquam quaerat voluptatem.

► Ut enim ad minima veniam, quis nostrum exercitationem ullam corporis suscipit laboriosam, nisi ut aliquid ex ea commodi consequatur.

REGION

SAMPLE

© 2018 Mercer LLC. SHORT-TERM INCENTIVES AROUND THE WORLD — SAMPLE 27

PREVALENCE OF LTI PRACTICES

MARKET PERCENTAGE OF COMPANIES PROVIDING LTI

INCENTIVE TYPE

STOCK OPTIONS RESTRICTED STOCK LONG-TERM CASH OTHER

ARGENTINA 30% 50% 50% 50% 50%

BRAZIL 40% 40% 40% 40% 40%

CANADA 30% 30% 30% 30% 30%

CHILE 40% 40% 40% 40% 40%

COLOMBIA 30% 30% 30% 30% 30%

COSTA RICA 40% 40% 40% 40% 40%

DOMINICAN REPUBLIC 30% 30% 30% 30% 30%

ECUADOR 40% 40% 40% 40% 40%

GUATEMALA 30% 30% 30% 30% 30%

MEXICO 40% 40% 40% 40% 40%

PANAMA 30% 30% 30% 30% 30%

PERU 40% 40% 40% 40% 40%

PUERTO RICO 30% 30% 30% 30% 30%

UNITED STATES 40% 40% 40% 40% 40%

URUGUAY 30% 30% 30% 30% 30%

VENEZUELA 40% 40% 40% 40% 40%

REGION

Notes: Some organizations offer more than one type of Long-Term Incentives so the incentives by type total exceeds 100%.

SAMPLE

© 2018 Mercer LLC. SHORT-TERM INCENTIVES AROUND THE WORLD — SAMPLE 28

REGIONPERCENTAGE OF COMPANIES PROVIDING LTI

RANK COUNTRY PERCENTAGE OF COMPANIES PROVIDING LTI

1 ARGENTINA 50%

2 BRAZIL 50%

3 CANADA 50%

4 CHILE 50%

5 COLOMBIA 50%

6 COSTA RICA 50%

7 DOMINICAN REPUBLIC 50%

8 ECUADOR 50%

9 GUATEMALA 50%

10 MEXICO 50%

SAMPLE

© 2018 Mercer LLC. SHORT-TERM INCENTIVES AROUND THE WORLD — SAMPLE 29

PREVALENCE OF LTI PRACTICES

MARKETPERCENTAGE OF

EMPLOYEES ELIGIBLE FOR LTI

EXECUTIVE

LONG-TERM INCENTIVE TYPE

STOCK OPTIONSSHARE

APPRECIATION RIGHTS

RESTRICTED SHARE/SHARE

UNIT

PERFORMANCE SHARES

PERFORMANCE CASH UNITS LONG TERM CASH

ARGENTINA 30% 50% 50% 50% 50% 50% 50%

BRAZIL 40% 40% 40% 40% 40% 40% 40%

CANADA 30% 30% 30% 30% 30% 30% 30%

CHILE 40% 40% 40% 40% 40% 40% 40%

COLOMBIA 30% 30% 30% 30% 30% 30% 30%

COSTA RICA 40% 40% 40% 40% 40% 40% 40%

DOMINICAN REPUBLIC 30% 30% 30% 30% 30% 30% 30%

ECUADOR 40% 40% 40% 40% 40% 40% 40%

GUATEMALA 30% 30% 30% 30% 30% 30% 30%

MEXICO 40% 40% 40% 40% 40% 40% 40%

PANAMA 30% 30% 30% 30% 30% 30% 30%

PERU 40% 40% 40% 40% 40% 40% 40%

PUERTO RICO 30% 30% 30% 30% 30% 30% 30%

UNITED STATES 40% 40% 40% 40% 40% 40% 40%

URUGUAY 30% 30% 30% 30% 30% 30% 30%

VENEZUELA 40% 40% 40% 40% 40% 40% 40%

REGION

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SHORT-TERM INCENTIVES AROUND THE WORLD — SAMPLE 31© 2018 Mercer LLC. 31 MET

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ABOUT THIS REPORTThis section provides information on the methods of collecting, collating, and analysing data for this publication. Below are notes on exceptions and exclusions in the data and a list of data sources, relevant equations, and currency conversions rates. Readers will also find a glossary of key terms.

METHODOLOGY

The following statistics are presented in this publication:

► Median: The data point that is higher than 50% of all other data in the sample when ranked from low to high. Also known as the 50th percentile.

► Average: The sum of all data reported divided by the number of data observations in the sample. Also known as the mean.

► Prevalence: The percentage of companies that provided a response to a question with a defined number of options to choose from. For example, a single response question or a multiple response (select all that apply) style question.

► In single response questions, the sum of all responses may not equal 100% due to rounding.

► In multiple response questions, the sum of all responses will be greater than 100%.

► N: The number of companies that reported data for the statistic.

► Endash or “–”: The sample is too small to provide the statistic.

STATISTICS

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ABOUT THIS REPORT

SHORT-TERM INCENTIVES AROUND THE WORLD — SAMPLE 32© 2018 Mercer LLC. 32 MET

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DATA MASKING To ensure the confidentiality of all companies that provide data to Mercer’s surveys, statistics have been “masked” by displaying an endash or “–” when minimum sample sizes are not met.

► A minimum of three data points are required to report the average and prevalence percentages.

► A minimum of four data points are required to report the median.

DATA ANALYSIS

This publication uses job-level STI data sourced from Mercer’s Total Remuneration Surveys (TRS) to calculate STI prevalence rates, STI actual incentives (as a percentage of base salary), and STI target incentive (as a percentage of base salary).

► Organisation-weighted average data are used to calculate the STI prevalence rates and STI actual and target incentives as a percentage of base salary.

► The averages are calculated using the number of observations of annual base salary with a threshold value greater than or equal to eight organisations.

► Throughout the report, the “target” is the expected STI percentage for the current performance year, while “actual” is the STI amount paid for the most recently completed performance year.

► The “percentage receiving” indicates the percentage of all employees that received a short-term incentive.

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© 2018 MERCER LLC. 33SHORT-TERM INCENTIVES AROUND THE WORLD — SAMPLE

Mercer Select IntelligenceSM is a global membership platform, offering HR and business professionals digital and in-person access to cutting-edge research, analysis, productivity tools, best practices, on-demand expertise, and peer networks. When it’s time to shape policy and make critical people-strategy decisions, Mercer Select Intelligence will keep you ahead of the curve with actionable insights into the latest HR news and key issues, including legislative and regulatory initiatives, local and global economic indicators, and emerging trends. As your trusted resource in a rapidly changing business environment, the Mercer Select Intelligence membership will continually evolve to deliver the human capital insights that you need to succeed. Visit select.mercer.com to learn more.

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34© 2018 Mercer LLC. SHORT-TERM INCENTIVES AROUND THE WORLD — SAMPLE

ABOUT MERCER At Mercer, we make a difference in the lives of more than 110 million people every day by advancing their health, wealth, and careers. We’re in the business of creating more secure and rewarding futures for our clients and their employees — whether we’re designing affordable health plans, assuring income for retirement, or aligning workers with workforce needs. Using analysis and insights as catalysts for change, we anticipate and understand the individual impact of business decisions, now and in the future. We see people’s current and future needs through a lens of innovation, and our holistic view, specialized expertise, and deep analytical rigor underpin each and every idea and solution we offer. For more than 70 years, we’ve turned our insights into actions, enabling people around the globe to live, work, and retire well. At Mercer, we say we Make Tomorrow, Today.

Mercer LLC and its separately incorporated operating entities around the world are part of Marsh & McLennan Companies, a publicly held company (ticker symbol: MMC) listed on the New York, Chicago, and London stock exchanges.

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Copyright 2018 Mercer LLC. All rights reserved.

For further information, please contact your local Mercer office or visit our website at www.imercer.com

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