60 • Promote effective risk management ‒ Compensation promotes risk management and discourages imprudent or excessive risk-taking . • Attract and retain talent ‒ People are one of our competitive advantages; therefore, compensation helps attract, motivate, and retain people with the skills, talent, and experience to drive superior long-term company performance . To confirm that our pay is competitive in the marketplace, jobs are assessed against our competitors at least annually . We look across industries because our competition for talent extends beyond the financial services sector . We invest significantly in salary increases and promotions for all roles at all levels across the company . For example, in addition to merit increases that result from annual performance reviews, each year we have averaged approximately 42,500 employee promotions with salary increases . We aim to provide fair, competitive, and equitable compensation . In March 2020, we announced an increase in our U .S . minimum hourly base pay in the majority of our markets . Our minimum hourly pay range in the U .S . is $15 to $20, based on the cost of labor in each Wells Fargo market . We also reviewed and adjusted the hourly pay for those whose pay was already at or close to the new minimum hourly wage . Incentive Compensation Risk Management Our compensation principles are supported by our Incentive Compensation Risk Management (ICRM) program, which establishes the expectations and requirements related to the design and oversight of the incentive plans for employees . The program seeks to provide eligible employees with incentives that appropriately balance risk and reward by establishing the governance framework, policies, risk management standards, and processes under which we manage incentive compensation risk . The program supports Wells Fargo’s Risk Management Framework and accounts for the company’s financial and non-financial risks and regulatory requirements . As part of the enterprise incentive compensation design process, the Incentive Compensation Center of Excellence design team or business- aligned compensation and performance management teams are expected to: • Conduct an annual incentive compensation risk assessment for each existing incentive compensation arrangement, and an incentive compensation risk assessment for each new incentive compensation arrangement or off-cycle revision of an existing arrangement, prior to implementing the incentive compensation arrangement . • Partner with appropriate enterprise functions to model plan measures for any new or materially revised formulaic incentive compensation arrangements before arrangements are finalized . • Obtain appropriate stakeholder review and approval of the plan and verify that plan documents are distributed prior to the plan effective date .