Independence of the Board. A majority of the Board shall be independent based on the independence standards of the New York Stock Exchange. The Board should not include professionals who provide material services to the Company (e.g. lawyers, commercial bankers) or any person who has a conflict of interest or a material relationship with the Company.
Size of Board. The by-laws provide that there shall be no less than 9 and no more than 15 members on the Board. The Board sets the exact number from time to time.
Board Membership Criteria and Selection. The Committee on Nominations and Corporate Governance is responsible for recommending Board candidates, based on criteria established by the Board and a periodic review of the needs of the Company and the current Board members' skills and expertise. The Board selects new candidates for election to the Board.
Appointment of Presiding Non-Management Director. The Board shall appoint one of the independent directors to lead the Board in the absence of the Chairman and the Deputy Chairman and in sessions held without management directors. A description of the presiding non-management director's responsibilities is included as part of the Company's corporate governance principles.
Selection of Chairman and CEO; Separation of Chairman and CEO. The Board of Directors has complete discretion to select a person or persons appointed as the Chairman and the Chief Executive Officer. The Board has no firm policy on separation of the positions of Chairman and CEO.
Former CEO on Board. Employee directors must retire as a director effective as of the next Board meeting following termination of active employment.
Director Compensation and Review. The Committee on Nominations and Corporate Governance reviews director compensation periodically. Director compensation will include an equity component.
Director Tenure. The Board adopted a mandatory retirement policy of age 70. If a director has a material change in his or her regular employment, he or she shall immediately tender his or her resignation, which the Board, in its discretion, may accept or reject. There are no term limits for directors.
Number of Committees. The Board will have an audit committee, a compensation committee and a nominations and governance committee, each of which shall be comprised solely of independent directors. The Board may appoint other committees from time to time. The committee charters, which are adopted by the Board, set forth the committees' duties and responsibilities. The committee structure and each committee's authority are reviewed periodically, and committee charters are reviewed annually.
Assignment and Rotation of Committee Members. The Committee on Nominations and Corporate Governance reviews membership of the various Board committees at least annually and recommends the appointment of committee members including the committee chairs to the Board for approval. Except for the chair of the Executive Committee, the Board's policy is to rotate committee chairs every 5 years. The Chairman of the Board, or in his absence the Deputy Chairman, shall serve as chair of the Executive Committee. The Executive Committee may meet at intervals between Board meetings and only meets at the request of and pursuant to specific limited authority granted by the Board. Meetings of the Executive Committee are infrequent.
Board Evaluation. The Committee on Nominations and Corporate Governance has responsibility to evaluate at least annually the overall effectiveness of the Board and the incumbent members. Directors are expected to attend all Board and committee meetings, devote sufficient time for preparation of meetings by reviewing agenda materials prior to the meeting and actively participate in the discussions at meetings.
Limit on Number of Directorships. There is no fixed limit on the number of boards on which a director may serve, but this is a factor in considering candidates for the Board.
Frequency, Length and Agenda for Meetings. The Chairman sets the agenda for Board meetings, and any director may request that an item be placed on the agenda. A meeting schedule and agenda for routine items is established annually for committees.
Materials/Information given to Board Members. A preliminary agenda and related materials are distributed to Board members the week prior to the Board meeting. The Committee on Nominations and Corporate Governance has responsibility to review the appropriateness and adequacy of information furnished to the Board.
Attendance at Board Meeting by Non-Members. The executive staff attends portions of all Board meetings. Other management personnel attend as requested by the Board.
Executive Sessions of Outside Directors. An executive session (with CEO) is held at each Board meeting. An executive session without any management directors is also held at each Board meeting.
Stock Ownership Guidelines for Directors. The Board has established a stock ownership guideline of 3 times the annual retainer for each director.
Formal Evaluation of CEO. An evaluation of the CEO is done annually by the Management Development and Compensation Committee as part of the compensation review, and then reviewed by the full Board.
Management Development and Succession Planning. The Management Development and Compensation Committee annually reviews the Company's management development program. Succession planning is reviewed at least every two years.
Board Interaction with Investors, the Press, Customers and Others. Pursuant to the Company's Disclosure Policy, all communications with the public are handled by the CEO, CFO and Vice President - Investor and Public Affairs. Accordingly, Board members will not make public statements about the Company. All inquiries should be routinely directed to one of the authorized spokespersons.
Confidential Shareholder Voting. The Company has adopted confidential voting. 22.
Governance Review. The Committee on Nominations and Corporate Governance has oversight responsibility of corporate governance issues.
Director Orientation and Director Continuing Education. Each new director shall attend an orientation session to meet executive officers of the Company, review the Company's business strategy and major issues and initiatives, review director duties and responsibilities, and review Company policies applicable to directors. The Company will make available to all directors opportunities for continuing education through presentations to the full Board in conjunction with regularly scheduled meetings (e.g. Board dinner speakers), special presentations from time to time or arranging attendance at director programs presented by various outside organizations. Any new director who has not previously served on the Board of a public company shall attend a continuing education program presented by an outside organization.
Code of Ethics and Business Conduct. The Audit Committee is responsible for reviewing the Company's Code of Ethics and Business Conduct and the procedures for monitoring compliance with the Code. The Board of Directors must approve any waivers of the Code for directors or executive officers.
Access to Management and Independent Advisors. In discharging its oversight role, the Board shall have access to the Company's management and the Board is empowered to investigate any matter within the scope of its authority and may engage independent advisors to assist in its investigations, as it deems necessary.
