ADT 2009 Annual Report Download - page 42

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 organizational development and succession
plans are maintained for these executive positions;
• determining the Chief Executive Officer’s compensation, and approving the compensation of
senior officers;
• 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;
• designing and assessing the effectiveness of its own governance practices and procedures as well
as Board and committee performance; and
• periodically monitoring and reviewing shareholder communication.
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 currently be
held by the same person. The Company has adopted a counterbalancing governance structure,
including:
• a designated lead Director;
• a Board entirely composed of independent members, with the exception of the Chairman and
Chief Executive Officer;
• 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 and ethics guidelines.
The lead Director acts as an intermediary between the Board and senior management. Among
other things, the lead director is responsible for setting the agenda for Board meetings with Board and
22 2010 Proxy Statement