Meetings and Agendas
The lead independent director approves the agenda for each Board meeting in consultation with the Chairman and the CEO and with the understanding that certain items pertinent to the advisory and monitoring functions of the Board are brought to the Board periodically by the CEO for review and/or decision. Agenda items that fall within the scope of responsibilities of a Board committee are reviewed with the chairman of that committee. Directors are encouraged to suggest the inclusion of items on the agenda. Directors are also free to raise subjects at a Board meeting that are not on the agenda for that meeting.
Directors are also expected to attend Board meetings and meetings of the Board committees on which they serve and spend the time necessary to properly discharge their responsibilities.
Distribution and Review of Board Materials
Board materials related to agenda items are provided to directors sufficiently in advance of Board meetings to allow directors to review and prepare for discussion of the items at the meeting. In some cases, due to timing or the sensitive nature of an issue, materials are presented only at the Board meeting.
Director Access to Management, Employees and Advisors
At the invitation of the Board, members of senior management recommended by the CEO may attend Board meetings or portions of meetings for the purpose of participating in discussions. Generally, presentations of matters to be considered by the Board are made by the manager responsible for that area of the Company’s operations. Directors also have full and free access to other members of management and to employees of the Company.
The Board has the authority to engage outside counsel, accountants, experts and other advisors as it determines appropriate to assist it in the performance of its functions.
Executive Sessions of Independent Directors
The independent directors routinely meet in executive session at regularly scheduled Board meetings. The lead independent director establishes the agenda for and presides at these sessions and has the authority to call additional executive sessions as appropriate.
Strategic Planning and Risk Oversight
The Board reviews the Company’s long-term strategic plan at least annually. The Board periodically reviews the Company’s major risks and the Company’s risk management processes, including in connection with its review of the Company’s strategy.
With the assistance of the Audit Committee, the Board oversees the Company’s enterprise-wide approach to the major risks facing the Company, and the Company’s policies, procedures and practices for assessing and managing its exposure to risk. In addition, the Board delegates to the standing committees primary responsibility for overseeing risks within their areas of responsibility.
Director Compensation
The Compensation and Human Resources Committee annually reviews the compensation of directors and recommends any changes for approval by the Board, which has the authority to set director compensation. Non-management directors receive a combination of cash and equity compensation for service on the Board.
Stock Ownership Guidelines
The Board has established stock ownership guidelines for directors and executives of the Company, which are set forth in a separate policy and described in the Company’s proxy statement.
Succession Planning
The Board plans for succession to the position of CEO as well as certain other senior management positions. The Board, in conjunction with the Compensation and Human Resources Committee, annually reviews the Company’s succession plans regarding the selection of individuals to fill these positions. The Board’s review involves succession planning both in the context of a sudden and unplanned absence or inability of the CEO or of other senior executives to fill their positions and in the context of planned promotions or retirements.
Formal Evaluation of CEO and Other Executive Officers
The Compensation and Human Resources Committee is responsible for setting annual and longterm performance goals for the CEO and for evaluating, in consultation with the Chairman, the performance of the CEO against those goals. The Compensation and Human Resources Committee both sets the CEO’s goals and evaluates the CEO’s performance against those goals in executive session. The Chairman shares the results of the evaluation with the CEO, and the Compensation and Human Resources Committee uses the results in considering and approving the compensation of the CEO.
The Compensation and Human Resources Committee also is responsible for reviewing and approving annual and long-term performance goals for other executive officers of the Company. The Compensation and Human Resources Committee reviews with the CEO the performance of these executive officers against the goals and based upon that review, and considering recommendations from the CEO, sets the executive officers’ compensation.
Annual Meeting of Stockholders
Directors are expected to attend the annual meeting of stockholders.
Director Orientation and Continuing Education
The Company has an orientation process for Board members that includes extensive materials and meetings with key management designed to familiarize new directors with various aspects of the Company’s business, including the Company’s strategy, operations, finances, risk management processes, compliance program, and governance practices.
Continuing education for current directors may take a variety of forms, including in-house presentations and briefings on developments relevant to the Company and the Board, as well as participation in external programs. The Board encourages directors to participate in education programs to assist them in performing their responsibilities as directors, and associated expenses are reimbursed by the Company.
The Governance & Nominating Committee oversees the orientation program for new directors and continuing education for current directors.
Annual Performance Evaluation
The Board and each of the Audit Committee, the Governance & Nominating Committee, and the Compensation & Human Resources Committee conduct an annual self-evaluation to assess their performance. In addition, the Chairman of the Board conducts annual interviews with each non-management director to discuss individual board member performance. The Governance & Nominating Committee oversees the processes for conducting evaluations of the Board, its committees, and individual directors.
Conflicts of Interest
If a director has a personal interest in a matter before the Board, the director will disclose the interest to the full Board, recuse himself or herself from participation in discussion of the matter and will not vote on the matter.