Transocean Proxy Statement and 2010 Annual Report

Peer Group and Competitive Positioning
Peer Group
We compete for executive talent across many different sectors around the world. Our primary
competitive market generally includes other companies in the energy industry (oil and gas companies,
offshore drilling companies and other energy services companies). In making compensation decisions for
the Named Executive Officers, each element of their total direct compensation is compared against
published compensation data.
For 2010, we used a group of peer companies to compare each component of our executive
compensation program to the competitive marketplace. This group (the ‘‘Peer Group’’) was comprised of
the following companies:
Anadarko Petroleum Corporation Hess Corporation
Apache Corporation Marathon Oil Corporation
Baker Hughes Incorporated National-Oilwell Varco Inc.
Devon Energy Corporation Noble Corporation
Diamond Offshore Drilling Inc. Pride International, Inc.
ENSCO plc Rowan Companies Inc.
EOG Resources, Inc. Schlumberger Limited
Halliburton Company Weatherford International Ltd.
The Peer Group or a smaller group may be used for performance comparisons as determined by the
Committee. In August 2010, the Committee removed Smith International, Inc. from the Peer Group due
to Smith International, Inc.’s merger with Schlumberger Limited.
Competitive Positioning
Generally, we set the target compensation for our executive officers, including the Named Executive
Officers, at the market median to remain competitive and avoid contributing to the ‘‘ratcheting-up’’ of
executive compensation that occurs when a large number of companies all target their executive
compensation at above-median levels. In 2010, we determined the market median based on data from the
Peer Group and market surveys analyzed by the compensation consultant, each weighted at 50%.
Our approach to setting executive compensation, which is periodically reviewed and updated by the
Committee, is as follows:
Element Targeted Position Comments
Base Salary Market median. Individual circumstances can allow for
certain positions to be above or below the
median.
Annual Bonus Opportunity to earn total Actual payout based on performance.
cash compensation Metrics include both financial and
competitive with market, operational results that drive long-term
with upside/downside value. Current award potential ranges from
based on performance 0% to 200% of target.
against financial and
operating metrics.
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