Purpose
The Committee is appointed by the Board of Directors to (i) identify individuals qualified to become Board members and to recommend to the Board the director nominees for the next annual meeting of shareholders, (ii) recommend to the Board corporate governance principles applicable to the Company, including those related to environmental, social responsibility and sustainability matters, (iii) oversee and approve the process and guidelines for the annual evaluation of the performance and effectiveness of the Independent Lead Director, the Board and its committees, and (iv) exercise and perform the authority, duties and responsibilities of the Committee set forth in this charter.
Membership
The Committee shall be comprised of at least three Board members appointed by the Board after considering the recommendation of the Committee. Committee members shall serve at the pleasure of the Board and for such term as the Board determines. The Board shall designate one Committee member as the Committee’s chair (the “Chair”).
Each Committee member shall have no material relationship with the Company and shall otherwise satisfy the independence requirements of the Company and the New York Stock Exchange.
Operations
The Committee shall hold regular meetings at least four times per year and report to the Board on a regular basis. Meetings shall include any participants the Committee deems appropriate and shall be of sufficient duration and scheduled at such times as the Committee deems appropriate to discharge properly its responsibilities.
The Committee shall meet, as deemed necessary and appropriate, with management, including the Chief Executive Officer, in executive session.
The Committee shall receive information and participate in informal meetings and briefings with management, including the Chief Executive Officer, as necessary and appropriate between formal meetings of the Committee. Such briefings and informal meetings may be through the Chair or individual Committee members, as appropriate.
The Committee may form and delegate to one or more subcommittees all or any portion of the Committee’s authority, duties and responsibilities, and may establish such rules as it determines necessary or appropriate to conduct the Committee’s business.
The Committee shall have direct access to, and complete and open communication with, the Company’s management and may obtain advice and assistance from internal legal or other advisors to assist it. The Committee may also retain legal or other advisors. The Committee shall have the sole authority to retain and terminate any search firm to be used to identify director candidates and to approve the search firm’s fees and retention terms.
The Company shall provide for appropriate funding, as determined by the Committee, for the payment of (i) ordinary administrative expenses of the Committee that are necessary or appropriate in carrying out its duties and responsibilities and (ii) compensation to legal and other advisors retained by the Committee.
The Committee shall review and assess its performance annually and report the results to the Board.
The Committee shall review and assess the adequacy of this charter annually and, if appropriate, recommend changes to the charter to the Board.
Authority, Duties and Responsibilities
The Committee shall:
Board Succession Planning
Oversee succession planning for the Board and Board leadership appointments, including the Independent Lead Director and committee chairs, in accordance with the Board’s Corporate Governance Policies.
Review the overall size and composition of the Board, taking into consideration the skills, attributes, experience and tenure of each Board member in accordance with the Board’s Corporate Governance Policies.
Review the term limit and retirement policies set forth in the Board’s Corporate Governance Policies and, if appropriate, recommend changes to the Board.
Actively seek and identify individuals qualified to become Board members for recommendation to the Board consistent with the Board membership criteria set forth in the Board’s Corporate Governance Policies. The Committee may consider director candidates proposed by shareholders or management and shall evaluate such candidates using the same criteria as other candidates considered by the Committee. Consistent with the retirement policy set forth in the Board’s Corporate Governance Policies, no director candidate should be nominated for election if he or she would be age 75 or older at the time of the election.
Recommend to the Board the director nominees for the Company’s next annual meeting of shareholders. In the case of a vacancy on the Board (including a vacancy created by an increase in the size of the Board), the Committee shall recommend to the Board an individual to fill such vacancy, as needed.
Retain and terminate, in its sole discretion, any search firm used to identify director candidates and any compensation consultant used to assist in the evaluation of director compensation, and to approve the fees and other retention terms for such firms and consultants.
Oversee the orientation program for newly elected or appointed directors.
Board Committees
Recommend to the Board director nominees for each Board committee, taking into consideration the skills, attributes, experience and tenure of each committee member, including committee members to fill vacancies as needed. In nominating a director for a committee membership, the Committee shall take into consideration the factors set forth in that committee’s charter, if any, and the rotation of committee assignments as set forth in the Board’s Corporate Governance Policies, and other factors it deems appropriate, including without limitation the interplay of the candidate’s experience with the experience of other committee members.
Recommend to the Board changes that the Committee believes desirable to the size of any committee of the Board or to the Board’s committee structure.
Board Performance
Oversee and approve the process and guidelines for the annual evaluation of the performance and effectiveness of the Independent Lead Director, the Board and its committees, including the communication of the results of such evaluations to the full Board.
Director Compensation and Insurance
;Review the director compensation program, as necessary and appropriate, and recommend changes to the Board.
Review the Company’s directors and officers insurance.
Corporate Governance Policies and Governance Documents
Annually review and assess the adequacy of the Board’s Corporate Governance Policies, including the director independence standards, and, if appropriate, recommend changes to the Board.
Periodically review the Company’s organizational documents, and, if appropriate, recommend changes to the Board.
Review and approve related person transactions in accordance with the Company’s Related Person Transactions Policy and associated disclosure. Report approved related person transactions to the Board.
Review shareholder proposals relating to environmental, social and governance (“ESG”) matters and management’s proposed response to such proposals.
Review and recommend to the Board whether to seek and accept a director’s offer to tender his or her resignation in the event such director’s principal occupation or employer changes.
Review and approve directors’ service on other public or private company boards and committees, and changes in directors’ circumstances in accordance with the Board’s Corporate Governance Policies.
Monitor and review evolving corporate governance trends and best practices, and as it determines appropriate, consider other matters of corporate governance and make recommendations to the Board regarding, or take action with respect to, such matters.
Philanthropic Programs
Review the strategy, policies and practices with respect to the philanthropic programs of the Company and foundations significantly supported by the Company.
Environmental, Social Responsibility and Other Governance Matters
As it determines appropriate, consider ESG matters, and make recommendations to the Board regarding, or take action with respect to, such matters.
Receive periodic reports from the Company’s management-level ESG Committee, as necessary and appropriate.
- As it determines appropriate, review and approve the Company’s ESG policies, including its Corporate Political Activities Policy Statement and the Environmental and Social Policy Statement.
Oversee, and receive reports at least annually on, the Company’s compliance with the Company’s prohibition on U.S. corporate political contributions; political contribution activities of the Morgan Stanley Political Action Committee; the Company’s significant lobbying priorities and expenditures attributable to lobbying in the U.S.; and the Company’s membership in, and expenditures relating to, its principal U.S. trade associations as set forth in the Company’s Corporate Political Activities Policy Statement.
Receive reports, as necessary and appropriate, from management on the Company’s community reinvestment activities.
Coordination with Management and Other Board Committees
Coordinate with management and other committees of the Board (which coordination may be through the committee chairs) to help ensure that the committees have received the information necessary to permit them to fulfill their duties and responsibilities with respect to oversight of risk management and risk assessment guidelines and policies.
Other Authority
Make such recommendations with respect to any of the above matters and any other matters as the Committee deems necessary or appropriate.
Have such other authority, duties and responsibilities as may be delegated to the Committee by the Board.