The Xerox Board of Directors represents our shareholders’ interest in the company’s successful operation. This active responsibility includes optimizing long-term financial returns and delivering value to our customers, employees, suppliers, communities and other key stakeholders. The Board is accountable for the company executing its responsibilities in a legal and ethical manner in any business environment.
The Board also provides oversight of the company’s role as a corporate citizen; it ensures that our actions align with our core values and priorities for citizenship. To that end, members of the Board have reviewed a detailed outline of this report and support its disclosures. Each director stands for re-election every year at the company’s annual shareholder meeting.
Xerox’s corporate governance guidelines are available at www.xerox.com/governance.
Independence of the Board
Based on standards for independence developed by the New York Stock Exchange, the Xerox Board is currently 88% independent. It includes one non-independent director: Xerox Chairman and CEO Ursula M. Burns.
More information on the Board’s independence is available at www.xerox.com/governance.
Criteria for Membership
The Corporate Governance Committee of the Xerox Board considers candidates for Board membership recommended by Board members, management, shareholders and others. The Corporate Governance Guidelines require that a substantial majority of the Board should consist of independent directors. Any management representation should be limited to top company management. There are no specific minimum qualifications that the Corporate Governance Committee believes must be met by candidates; however, the Corporate Governance Committee applies criteria set forth in our Corporate Governance Guidelines which include, among other things, the candidate’s broad perspective, integrity, independence of judgment, experience, expertise, diversity, ability to make independent analytical inquiries, understanding of the company’s business environment and willingness to devote adequate time and effort to Board responsibilities. Nominees should bring a variety of business backgrounds, experiences and perspectives to the Board. The Corporate Governance Committee does not assign specific weights to particular criteria and no particular criterion is necessarily applicable to all prospective nominees.
In an uncontested election, each director is elected by the affirmative vote of a majority of the total votes cast for the director. Any nominee who receives a greater number of votes “against” than “for” his or her election is required to submit his or her resignation promptly. The remaining independent directors then evaluate relevant facts and circumstances and determine whether to accept or reject the resignation. Following the official results of the election, the Board is required to promptly disclose, in a filing with the Securities and Exchange Commission, its decision and the reasons for it.
Requirement for Ownership of Shares
All non-employee directors are expected to establish a meaningful equity ownership interest in the company. This requirement is achieved by paying directors at least one-half of their Board membership fees in deferred stock units, which are required to be held until one year after termination of Board service.
Access to Management, Employees and Advisors
Board members have complete access to the Company's senior management and other employees and, at the company’s expense, are authorized to obtain advice and assistance from outside professional advisors of their choosing.
Interaction with Stakeholders
Board members are expected to attend the company’s annual meeting of shareholders and be available to speak with Xerox stakeholders. To communicate with the non-management directors, you may directly contact the Chairman of the Xerox Corporate Governance Committee at the address as it appears on the company’s website at: www.xerox.com/about-xerox/citizenship/corporate-governance/guidelines.
Executive Sessions of Outside Directors
Each regularly scheduled Board meeting includes an executive session of only the independent directors. The Board annually appoints the Chairman of either the Corporate Governance Committee or the Compensation Committee as the lead independent director, whose responsibility is to preside over the non-management executive sessions and provide appropriate feedback to the Chairman and CEO.
Xerox has four standing committees: Audit, Compensation, Corporate Governance and Finance. Each is composed entirely of independent directors.
The purpose of the Audit Committee is to assist in Board oversight of the: (1) integrity of the company’s financial statements; (2) compliance with legal and regulatory requirements; (3) independent auditors’ qualifications and independence; (4) performance of our independent auditors and internal audit function; (5) Code of Business Conduct and ethics; and (6) preparation of the Audit Committee report to be included in our annual proxy statement
The purpose of the Compensation Committee is to: (1) discharge the responsibilities of the Board relating to compensation of the company’s officers; (2) oversee the evaluation of the Chief Executive Officer and other members of management who are senior officers; (3) oversee the administration of the company’s executive compensation plans; (4) prepare a Compensation Committee report required by the applicable SEC rules and; (5) consult with the Chief Executive Officer and advise the Board with respect to senior management succession planning.
The purpose of the Corporate Governance Committee is to: (1) identify individuals qualified to become Board members; (2) recommend to the Board individuals to serve as directors of the company and on committees of the Board; (3) advise the Board with respect to Board composition, procedures and committees; (4) develop, recommend to the Board and annually review a set of corporate governance principles applicable to the company; (5) evaluate and make recommendations to the Board with respect to the compensation of directors; (6) oversee the evaluation of the Board; and (7) administer the Company’s Related Person Transactions Policy.
The purpose of the Finance Committee is to: (1) review the company’s cash position, capital structure and strategies, financing strategies and insurance coverage; and (2) review and make recommendations on the company’s dividend policy.
The purpose and responsibilities for each of these committees is outlined in committee charters adopted by the Board, which are available at www.xerox.com/about-xerox/citizenship/corporate-governance/charters/enus.html.