Pizza Hut 2013 Annual Report Download - page 31

YUM! BRANDS, INC.-2014Proxy Statement 9
Proxy Statement
GOVERNANCE OF THE COMPANY
• Advance Materials. Information and data important to
the directors’ understanding of the business or matters to
be considered at a Board or Board Committee meeting
are, to the extent practical, distributed to the directors
sufficiently in advance of the meeting to allow careful
review prior to the meeting.
•
Board and Committees’ Evaluations. The Board
has an annual self-evaluation process that is led by the
Nominating and Governance Committee. This assessment
focuses on the Board’s contribution to the Company and
emphasizes those areas in which the Board believes a
better contribution could be made. In addition, the Audit,
Management Planning and Development and Nominating
and Governance Committees also each conduct similar
annual self-evaluations.
•
Majority Voting Policy. Our Articles of Incorporation
require majority voting for the election of directors in
uncontested elections. This means that director nominees
in an uncontested election for directors must receive a
number of votes “for” his or her election in excess of the
number of votes “against.” The Company’s Corporate
Governance Principles further provide that any incumbent
director who does not receive a majority of “for” votes will
promptly tender to the Board his or her resignation from
the Board. The resignation will specify that it is effective
upon the Board’s acceptance of the resignation. The Board
will, through a process managed by the Nominating and
Governance Committee and excluding the nominee in
question, accept or reject the resignation within 90 days
after the Board receives the resignation. If the Board rejects
the resignation, the reason for the Board’s decision will
be publicly disclosed.
What access do the Board and Board committees have to management
and to outside advisors?
• Access to Management and Employees. Directors
have full and unrestricted access to the management and
employees of the Company. Additionally, key members of
management attend Board meetings to present information
about the results, plans and operations of the business
within their areas of responsibility.
• Access to Outside Advisors. The Board and its
committees may retain counsel or consultants without
obtaining the approval of any officer of the Company
in advance or otherwise. The Audit Committee has the
sole authority to retain and terminate the independent
auditor. The Nominating and Governance Committee
has the sole authority to retain search firms to be used to
identify director candidates. The Management Planning
and Development Committee has the sole authority to
retain compensation consultants for advice on executive
compensation matters.
What is the Board’s role in risk oversight?
The Board maintains overall responsibility for overseeing
the Company’s risk management. In furtherance of its
responsibility, the Board has delegated specific risk-
related responsibilities to the Audit Committee and to the
Management Planning and Development Committee. The
Audit Committee engages in substantive discussions of
risk management at its regular committee meetings held
during the year. At these meetings, it receives functional
risk review reports covering significant areas of risk from
senior managers responsible for these functional areas,
as well as receiving reports from the Company’s Chief
Auditor. Our Chief Auditor reports directly to the Chair of the
Audit Committee and our Chief Financial Officer. The Audit
Committee also receives reports at each meeting regarding
legal and regulatory risks from management. The Audit
Committee provides a summary to the full Board at each
regular Board meeting of the risk area reviewed together
with any other risk related subjects discussed at the Audit
Committee meeting. In addition, our Management Planning
and Development Committee considers the risks that may
be implicated by our compensation programs through a
risk assessment conducted by management and reports
its conclusions to the full Board.