ADT 2007 Annual Report Download - page 28

Board Responsibilities
The Board is responsible for:
• reviewing and approving management’s strategic and business plans;
• reviewing and approving financial plans, objectives and actions, including significant capital
allocations and expenditures;
• monitoring management’s execution of corporate plans and objectives;
• advising management on significant decisions and reviewing and approving major transactions;
• identifying and recommending Director candidates for election by shareholders;
• appraising the Company’s major risks and overseeing that appropriate risk management and
control procedures are in place;
• selecting, monitoring, evaluating, compensating and, if necessary, replacing the Chief Executive
Officer and other senior executives, and seeing that management development and succession
plans are maintained for these executive positions;
• determining the Chief Executive Officer’s compensation, and approving senior executives’
compensation;
• overseeing that procedures are in place designed to promote compliance with laws and
regulations;
• overseeing that procedures are in place designed to promote integrity and candor in the audit of
the Company’s financial statements and operations, and in all financial reporting and disclosure;
and
• designing and assessing the effectiveness of its own governance practices and procedures as well
as Board and committee performance.
Board Leadership
The business of the Company is managed under the direction of the Company’s Board, in the
interest of the shareholders. The Board delegates its authority to senior management for managing the
everyday affairs of the Company. The Board requires that senior management review major actions and
initiatives with the Board prior to implementation.
The Company believes the positions of Chairman and Chief Executive Officer should be held by
the same person, unless circumstances dictate otherwise. The Company has adopted a counterbalancing
governance structure, including:
• a designated lead Director;
• a substantial majority of independent Directors;
• annual election of Directors by a majority of votes cast at the annual general meeting of
shareholders;
• committees entirely composed of independent Directors; and
• established governance guidelines.
The lead Director, among other things, sets the agenda for Board meetings with Board and
management input, facilitates communication among Directors, works with the Chief Executive Officer
to provide an appropriate information flow to the Board, and chairs an executive session of the
independent Directors at each formal Board meeting.
8 2008 Proxy Statement