Chipotle 2013 Annual Report Download - page 91
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Please find page 91 of the 2013 Chipotle annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.-
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Role of the Board of Directors in Risk Oversight
While our executive officers and various other members of management are responsible for the day-to-day
management of risk, the Board of Directors exercises an oversight role with respect to risk issues facing our
company, principally through considering risks associated with our company strategy as part of its oversight of
our overall strategic direction, as well as delegation to the Audit Committee of the responsibility for evaluating
enterprise risk issues. Under the terms of its charter, the Audit Committee discusses with management, our
internal auditors and our independent auditors our major risk exposures, whether financial, operating or
otherwise, as well as the adequacy and effectiveness of steps management has taken to monitor and control such
exposures (including, for instance, our internal control over financial reporting). The Audit Committee’s
oversight of risk management includes its review each year of an annual risk assessment conducted by our
internal audit department, which functionally reports to the Audit Committee. The Audit Committee also
recommends from time to time that key identified risk areas be considered by the full Board, and individual
Board members also periodically ask the full Board to consider an area of risk. In those cases the Board considers
the identified risk areas at its regularly-scheduled meetings, including receiving reports from and conducting
discussions with the appropriate management personnel.
The Board believes our current leadership structure facilitates its oversight of risk by combining
independent leadership through the Lead Director, independent Board committees, and majority independent
Board composition, with an experienced Chairman and Co-Chief Executive Officer and additional Co-Chief
Executive Officer with intimate knowledge of our business, industry and challenges. The Co-Chief Executive
Officers’ in-depth understanding of these matters and levels of involvement in the day-to-day management of
Chipotle allow them to promptly identify and raise key risks to the Board, call special meetings of the Board
when necessary to address critical issues, and focus the Board’s attention on areas of concern. This is effectively
balanced by the independent oversight of the Lead Director, independent Board committees, and independent
directors as a whole, who can objectively assess the risks identified by the Board or by management, as well as
management’s effectiveness in managing such risks.
19
Proxy Statement