Sallie Mae 2011 Annual Report Download - page 88

Chairman. Key risk functions include working with management to establish and present to our Board of
Directors acceptable risk tolerances and parameters for the Company; periodic review and allocation of oversight
of particular risks to the committees of the Board for oversight and reporting to the Board of Directors; and
advance review with the Audit Committee of all our earnings releases, periodic reports and management’s
opinions on business outlook and financial guidance.
Finance and Operations Committee — assists the Board of Directors through its oversight and reporting
on capital management, funding/liquidity strategy, acquisitions, and business operation matters. Key risk
functions include monitoring our management’s performance within agreed risk parameters and tolerances with
respect to all aspects of our operational and financial risk profile, including our Private Education Loan programs
and new product initiatives; credit, interest rate and currency risks; investment, asset, and liability management
policies and contingency funding plan.
Audit Committee — assists the Board of Directors through its oversight and reporting on the integrity of
our financial statements and internal controls processes. Key risk functions include periodically reviewing our
financial statements and public disclosures and financial and disclosure policies and underlying assumptions; the
qualifications, performance and independence of our independent auditors and Internal Audit group;
management’s efforts and effectiveness in managing legal and regulatory compliance and litigation risks; the risk
assessment, audit plans and conduct of the Internal Audit group; our information security practices and
procedures; and compliance with material aspects of the our Code of Business Conduct and related policies
regarding independence and transactions with affiliates.
Compensation and Personnel Committee — assists the Board of Directors through its oversight and
reporting matters of executive compensation and personnel. Key risk functions include the approval of
compensation, benefits and employment arrangements for our CEO, other senior executive officers and the
independent members of the Board; approval of all equity-based plans; general oversight of all benefit,
compensation and incentive plans applicable to executive management; consideration of the risk management
review of compensation practices conducted at least annually by our Chief Credit and Chief Compliance
Officers; advising on various human resources matters, including succession planning and talent management.
Nominating and Governance Committee — assists the Board of Directors through its oversight and
reporting of appropriate standards for governance, board operations and qualifications and recommendations of
directors. Key risk functions include establishing appropriate standards for corporate governance and guidelines,
conducting our Board of Directors’ annual self-assessment survey and taking actions regarding its results as
relates to improving the operations of the Board of Directors, the qualifications of its directors and succession
planning at the Board of Directors and CEO levels.
Strategy Committee — This committee engages the CEO and senior management from time to time to
develop and prepare for the Board of Directors’ annual strategic planning process and facilitate the exchange of
information and ideas with our management team in their development of proposals to be considered and
approved by the Board of Directors regarding our long-term strategic agenda and initiatives. The committee has
no separate or delegated authority from that of our Board of Directors.
Risk Assessment
Our Internal Audit Department monitors our various risk management and compliance efforts, identifies
areas that may require increased focus and resources, and reports significant control issues and recommendations
to executive management and the Audit Committee of our Board of Directors. At least annually, Internal Audit
performs a risk assessment to identify our top risks and to help develop the annual internal audit plan. Risks are
rated on significance and likelihood of occurrence and communicated to our management team members who
allocate appropriate attention and resources. The risk assessment focuses on those risks most relevant to us and
our subsidiaries (including the Bank). The assessment process includes completion of an anonymous survey by
our officers followed by interviews with and reports to senior leadership.
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