ADT 2007 Annual Report Download - page 40

Compensation and Human Resources Committee. The Compensation Committee reviews and
approves compensation and benefits policies and objectives, determines whether Tyco’s officers,
Directors and employees are compensated according to these objectives, and carries out certain of the
Board’s responsibilities relating to the compensation of Tyco’s executives. The Compensation
Committee operates under a charter approved by the Board. The charter is posted on Tyco’s website at
www.tyco.com and we will provide a copy of the charter to shareholders upon request. The
Compensation Committee held nine meetings during fiscal 2007. The members of the Compensation
Committee are Admiral Blair and Messrs. Duperreault and Gupta. Mr. Gupta is the chair of the
Compensation Committee. The Board of Directors has determined that each of the members of the
Compensation Committee is independent under NYSE listing standards. In addition, each member is a
‘‘Non-Employee’’ Director as defined in the Securities Exchange Act of 1934 and is an ‘‘outside
director’’ as defined in section 162(m) of the Internal Revenue Code. For more information regarding
the Compensation Committee’s roles and responsibilities, see the discussion under the heading ‘‘Role
of the Compensation Committee’’ in the Compensation Discussion and Analysis.
Compensation Committee Interlocks and Insider Participation
None of the members of the Compensation Committee during fiscal 2007 or as of the date of this
proxy statement is or has been an officer or employee of the Company and no executive officer of the
Company served on the compensation committee or board of any company that employed any member
of the Company’s Compensation Committee or Board of Directors.
Nomination of Directors
The Nominating and Governance Committee, in accordance with the Board’s governance
principles, seeks to create a Board that as a whole is strong in its collective knowledge and has a
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 vigorous standard of independence. 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 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 Director can serve to no more than two for Directors who are
employed as chief executive officer of a publicly traded company, no more than three for Directors
who are otherwise fully employed and no more than five for Directors who are not fully employed. A
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