ADT 2005 Annual Report Download - page 35

corporate governance. In addition, the Nominating and Governance Committee also oversees our
environmental, health and safety management system. The Nominating and Governance Committee
operates under a charter approved by the Board. The charter is posted on Tyco’s website at
www.tyco.com, and we will also provide a copy of the charter to shareholders upon request. The
Nominating and Governance Committee held seven meetings during fiscal 2005. The members of the
Nominating and Governance Committee are Ms. Wijnberg and Messrs. Krol and McCall, each of
whom is independent under NYSE listing standards. Mr. Krol is the Chair of the Committee.
Nomination of Directors
As provided in its charter, the Nominating and Governance Committee will consider nominations
submitted by shareholders. The Nominating and Governance Committee, in accordance with the
Board’s governance principles, seeks to create a Board that is as a whole strong in its collective
knowledge of and diversity of skills and experience with respect to accounting and finance, management
and leadership, vision and strategy, business operations, business judgment, crisis management, risk
assessment, industry knowledge, corporate governance and global markets. When the Committee
reviews a potential new candidate, the Committee looks specifically at the candidate’s qualifications in
light of the needs of the Board and the Company at that time, given the then-current mix of director
attributes.
General criteria for the nomination of director candidates include:
• The highest ethical standards and integrity;
• A willingness to act on and be accountable for Board decisions;
• An ability to provide wise, informed and thoughtful counsel to top management on a range of
issues;
• A history of achievement that reflects superior standards for themselves and others;
• Loyalty and commitment to driving the success of the Company;
• An ability to take tough positions while at the same time working as a team player; and
• Individual backgrounds that provide a portfolio of experience and knowledge commensurate with
the Company’s needs.
The Company also strives to have all directors, other than the Chief Executive Officer, be
independent. In addition to having such directors meet the NYSE definition of independence, the
Board has set its own more stringent standards of independence, as described under ‘‘Corporate
Governance—Independence of Nominees for Director’’ above. The Committee must also ensure that
the members of the Board as a group maintain the requisite qualifications under NYSE listing
standards for populating the Audit, Compensation and Human Resources and Nominating and
Governance Committees. In November 2005, the Board governance principles were amended to limit
the number of other public company boards of directors on which a non-executive director can serve to
two for directors who are employed as CEO of a publicly traded company, three for directors who are
otherwise fully employed and five for directors who are not fully employed. A director currently serving
on boards in excess of these limits may continue to do so, unless the Board determines that doing so
would impair the director’s service on the Company’s Board. With respect to Mr. McDonald, the Board
has determined that his service on other public company boards does not impair his service on the Tyco
Board. Directors must also resign from the Board at the annual general meeting of shareholders
following their 72nd birthday.
2006 Proxy Statement 17