Pottery Barn 2008 Annual Report Download - page 114

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OPPOSITION STATEMENT OF THE BOARD OF DIRECTORS
What is this proposal?
This proposal recommends that the Board adopt a policy to appoint an independent director who has not
previously served as one of our executive officers to serve as Chairman.
How does the Board recommend shareholders vote on this proposal and for what reasons?
The Board recommends you vote AGAINST this proposal for the following reasons:
• We believe that the composition of the Board and its committees and our corporate governance structure
provide effective independent oversight of management;
• Adopting a policy requiring the Board to select an independent director as Chairman would force the
Board to make a change, which we believe would not be in the best interests of the company or its
shareholders at this time. In the future, selecting an independent director to serve as Chairman may or
may not be in the best interests of the company and its shareholders. We believe the Board will be in the
best position to make that determination; and
• The Board has appointed a Lead Independent Director to ensure that independent directors continue to
take a leadership role in carrying out the Board’s duties.
It is the opinion of the Board that our corporate governance structure, with its strong emphasis on Board
independence, makes a requirement to appoint an independent director as Chairman unnecessary. Seven of the
Board’s nine directors are independent under New York Stock Exchange rules and our own director
independence standards. In addition, every member of each of the Board’s three committees is independent.
Board members have complete access to management and outside advisors; the Chairman is not the sole source
of information for the Board. The Board and each Board committee also meet regularly in executive session
without management. As a result, the Board does not believe that mandating an independent Chairman is
necessary to achieve effective independent oversight of management and the company.
The chairman of our Nominations and Corporate Governance Committee will continue to advise the Chairman as
to the quality, quantity and timeliness of the information provided by the Company’s management in order for
independent directors to effectively and responsibly perform their duties. The Lead Independent Director will
preside over the regular executive sessions of the independent directors and will ensure that independent
directors continue to communicate at critical times by calling meetings of the independent directors when
necessary.
The Board values its flexibility to select the Chairman it considers to be best able to meet the needs of the
company and its shareholders, based on the qualifications of the directors then serving on the Board. Mandating
an independent Chairman would limit the Board’s ability to select the director best suited to serve as Chairman
based on our circumstances at that time, and would impose an unnecessary restriction on the Board that may not
be in the best interests of our company or its shareholders.
What vote is required to approve this proposal?
To approve this proposal, a majority of the shares represented and voting at the Annual Meeting and a majority
of the quorum required to transact business at the Annual Meeting must vote “FOR” this proposal.
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