Harris Teeter 2012 Annual Report Download - page 81

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CORPORATE GOVERNANCE MATTERS
Corporate Governance Guidelines and Committee Charters
In furtherance of its longstanding goal of providing effective governance of the Company’s business and affairs
for the benefit of shareholders, the Board of Directors of the Company has approved Corporate Governance
Guidelines. The Corporate Governance Guidelines contain general principles regarding the functions of the
Company’s Board of Directors. The Corporate Governance Guidelines are available on the Company’s website at
www.harristeeter.com under “Investor Relations” (the “Company’s Website”). In addition, committee charters for
the Company’s Audit Committee, Compensation Committee and Corporate Governance & Nominating Committee
are also included on the Company’s Website.
Director Independence
For a director to be considered independent under the listing standards of the New York Stock Exchange, the
Board of Directors must affirmatively determine that the director has no direct or indirect “material relationship”
with the Company, other than as a director. The Board of Directors has adopted categorical standards to assist it
in making independence determinations. The categorical standards set forth below and available on the Company’s
Website, specify certain relationships that may exist between the Company and a director, each of which is deemed
not to be a “material relationship” and therefore will not, alone, prevent a director from being considered
“independent”.
•Prior Employment. The director was an employee of the Company or one of its operating subsidiaries,
or his or her immediate family member was an executive officer of the Company, and over five years
have passed since such employment ended.
•Prior Relationship with the Company’s Auditors. A director or immediate family member was an
employee or partner of the Company’s independent auditor, and over three years have passed since such
employment, partner or auditing relationship ended.
•Current Employment. An immediate family member of a director is employed by the Company, one
of its operating subsidiaries or another entity in a non-officer position, or by the Company’s independent
auditor not as a partner and not participating in the firm’s audit, assurance or tax compliance practice.
•Interlocking Directorships. A director was employed, or his or her immediate family member was
employed, as an executive officer of another company, during a time in which any of the Company’s
executive officers served on that other company’s compensation committee, and over three years have
passed since such service or employment relationship ended.
•Business Relationships. A director was an executive officer or an employee, or his or her immediate
family member was an executive officer, of another company that made payments to, or received
payments from, the Company or its operating subsidiaries for property or services in an amount which,
in each of the preceding three fiscal years, was less than the greater of $1 million, or 2% of such other
company’s consolidated gross revenues.
•Charitable Contributions. A director was an executive officer of a charitable organization that received
contributions from the Company or its operating subsidiaries in an amount which, in each of the preceding
three fiscal years, was less than the greater of $1 million, or 2% of such charitable organization’s
consolidated gross revenues.
After considering these categorical standards, the listing standards of the New York Stock Exchange and all
other relevant facts and circumstances, including commercial or charitable relationships between the directors and
the Company, the Board of Directors has determined that all nominees for director meet the Company’s categorical
independence standards, meet the independence requirements of the New York Stock Exchange and are independent
except for Thomas W. Dickson. In connection with its independence evaluation, the Board of Directors considered
the transactions involving the Company and Mr. Spilman. Mr. Spilman is the President and Chief Executive Officer
of Bassett Furniture Industries, Incorporated, which was a customer of the Company’s American & Efird business
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