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Finance Committee Charter
Effective 25 January 2007
Purpose and Areas of Focus
The Finance Committee (the “Committee”) shall assist the Board of Directors (the “Board”) in fulfilling its oversight responsibilities on an ongoing basis for matters relating to the financial practices and condition of the Company by reviewing Company financial policies and procedures; keeping informed of Company financial condition, requirements for funds, and access to liquidity; considering and advising the Board concerning Company sources and uses of funds, including payment of dividends to shareholders and repurchase of Company stock; and reviewing and recommending to the Board methods and terms of external financing and other financial transactions required to achieve the Company’s objectives. The Committee shall also have the authority of the Board with respect to oversight for the funding and management of assets of the Company’s and its controlled subsidiaries’ employee pension and savings plans worldwide.
Authority and Responsibilities
The Committee shall review and keep informed of, and, as appropriate, advise or make recommendations to the Board regarding such matters as:
- The Company’s finance plan which may address cash from internal sources (operations and asset sales), capital spending requirements (i.e., the capital plan), credit rating targets/rating agency relationships, capital structure, dividend policy, share repurchase policy, and external financing requirements;
- Company financing transactions;
- The Company’s programs and policies for financial risk management, including debt portfolio management (covering currency, fixed/floating rate, and maturity profiles); currency risk management; insurance and risk management (covering property, casualty, and directors and officers liability); and commodity price risk management;
- Employee pension and savings plan funding and investment management actions, policies, objectives, and performance; and
- Other matters, as directed by the Board.
The Committee shall appoint the members of management who shall serve on the Pension Investment Committee which serves as a named fiduciary of the Company’s employee benefit plans subject to the Employee Retirement Income Security Act of 1974, as amended from time to time (“ERISA”), and periodically review actions taken and business conducted by the Pension Investment Committee, the performance of the assets of the employee benefit plans of the Company and its affiliates, and the funding requirements of and contributions to such plans.
Committee Structure; Member Appointment and Removal
The Committee shall consist of at least three directors who, along with the chairperson of the Committee, are appointed by the Board, upon the recommendation of the Corporate Governance and Nominating Committee (the “Governance Committee”), and may be removed by the Board in its discretion.
Committee Operations: Meetings, Agendas, Reporting, and Delegation
The Committee may adopt the procedural rules for its meeting and the conduct of its business, not inconsistent with this Charter, the Company’s bylaws, or applicable law. The Committee is governed by the same rules regarding meetings (including meetings by conference telephone or similar communications equipment), action without meetings, notice, waiver of notice, and quorum, and voting requirements as are applicable to the Board. Adequate provision will be made for notice to members of all meetings. One-third of the members, but not less than two, shall constitute a quorum, and all matters will be determined by a majority vote of the members present. The Committee may delegate all or a portion of the authority granted to it by the Board to one or more of the Committee members, senior executives, or subcommittees, subject to applicable plans, laws, and regulations.
The Board approves the regular meeting schedule for the Committee each year. Additional meetings may occur, as the Committee or the Chairman deem advisable. The Chairman of the Board, the Corporate Secretary, and the Committee Chairman agree on the length of regular meetings and the need to schedule additional special meetings.
The annual Committee agenda and individual meeting agendas are developed by the Chairman of the Board and Corporate Secretary in consultation with the Committee Chairman, with input from appropriate members of management and staff.
When present, the Chairman will preside at Committee meetings. In his or her absence, Committee members present may appoint a chairman pro temp. The Committee Chairman reports to the Board on Committee meetings and actions, and the Committee Secretary (who is the Corporate Secretary or an Assistant Corporate Secretary) keeps minutes of all Committee meetings, which are distributed to Committee members for review and approval.
Resources
The Committee will have the resources and authority necessary to discharge its duties and responsibilities. The Committee has sole authority to retain and terminate outside counsel or other experts or consultants, as it deems appropriate including sole authority to approve the firms’ fees and other retention terms. The Company will provide the Committee with appropriate funding as the Committee determines, for the payment of compensation to outside counsel and other advisors as it deems appropriate, and administrative expenses of the Committee that are necessary or appropriate in carrying out its duties. In discharging its oversight role, the Committee is empowered to investigate any matter brought to its attention. The Committee will have access to the Company’s books, records, facilities, and personnel. Any communications between the Committee and legal counsel in the course of obtaining legal advice will be considered privileged communications of the Company, and the Committee will take all necessary steps to preserve the privileged nature of those communications.
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