Kodak 2006 Annual Report Download - page 166

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nBoard Structure and Corporate Governance
INTRODUCTION
Ethical business conduct and good corporate governance are not new practices at Kodak. The reputation of our Company and our brand has been
built by more than a century of ethical business conduct. The Company and the Board have long practiced good corporate governance and believe
it to be a prerequisite to providing sustained, long-term value to our shareholders. We continually monitor developments in the area of corporate
governance and lead in developing and implementing best practices. This is a fundamental goal of our Board.
CORPORATE GOVERNANCE GUIDELINES
Our Corporate Governance Guidelines refl ect the principles by which the Company operates. From time to time, the Board reviews and revises our
Corporate Governance Guidelines in response to regulatory requirements and evolving best practices. In February 2004, our Board restated our
Corporate Governance Guidelines to refl ect changes in the NYSE’s corporate governance listing standards. Early this year, the Board made several
changes to the guidelines to enhance its governance practices. The changes are described on page 30 of this Proxy Statement. A copy of the Corpo-
rate Governance Guidelines is published on our website at www.kodak.com/go/governance.
BUSINESS CONDUCT GUIDE AND DIRECTORS’ CODE OF CONDUCT
All of our employees, including the CEO, the CFO, the Controller, all other senior fi nancial offi cers and all other executive offi cers, are required to
comply with our long-standing code of conduct, the “Business Conduct Guide.” The Business Conduct Guide requires our employees to maintain the
highest ethical standards in the conduct of company business so that they and the Company are always above reproach. In 2004, our Board adopted
a Directors’ Code of Conduct. Both our Business Conduct Guide and our Directors’ Code of Conduct are published on our website at www.kodak.
com/go/governance. We will post on this website any amendments to, or waivers of, the Business Conduct Guide or Directors’ Code of Conduct. Our
directors have begun the annual practice of certifying in writing that they understand and are in compliance with the Directors’ Code of Conduct.
BOARD INDEPENDENCE
For a number of years, a substantial majority of our Board has been comprised of independent directors. In February 2004, the Board adopted
Director Independence Standards to aid it in determining whether a director is independent. These Director Independence Standards, which are in
compliance with the director independence requirements of the NYSE’s corporate governance listing standards, are attached as Exhibit I to this Proxy
Statement.
The Board has determined that each of the following directors has no material relationship with the Company (either directly or as a partner,
shareholder or offi cer of an organization that has a relationship with the Company) and is independent under the Company’s Director Independence
Standards and, therefore, is independent within the meaning of the NYSE’s corporate governance listing standards and the rules of the SEC: Richard
S. Braddock, Martha Layne Collins, Timothy M. Donahue, Michael J. Hawley, William H. Hernandez, Durk I. Jager, Debra L. Lee, Delano E. Lewis, Paul
H. O’Neill, Hector de J. Ruiz and Laura D’Andrea Tyson. The remaining director, Antonio M. Perez, Chairman of the Board and CEO, is an employee of
the Company and, therefore, is not independent.
In the course of the Board’s determination regarding the independence of each non-employee director, it considered any transactions, relationships
and arrangements as required by the Company’s Independence Standards. In particular, with respect to the most recent completed fi scal year, the
Board considered:
• the annual amount of sales to the Company by the company where Mr. Donahue served as an executive offi cer, and determined that the
amount of sales did not exceed the greater of $1,000,000 or 2% of the consolidated gross revenues of that company and, therefore, were
immaterial;
• the annual amount of purchases from the Company by the company where Mr. Hernandez serves as an executive offi cer, and determined that
the amount of sales did not exceed the greater of $1,000,000 or 2% of the consolidated gross revenues of that company and, therefore, were
immaterial; and
• the amount of the Company’s charitable contributions to a charitable organization where an immediate family member of Mr. Braddock’s
serves as an executive offi cer, and determined that the Company’s contributions were less than the greater of $1,000,000 or 2% of the chari-
table organization’s annual gross revenues and, therefore, were immaterial.