TripAdvisor 2014 Annual Report Download - page 133

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The committees of the Board execute their oversight responsibility for risk management as follows:
x The Audit Committee has primary responsibility for discussing with management TripAdvisor’s major financial risks and
the steps management has taken to monitor and control such risks. In fulfilling its responsibilities, the Audit Committee
receives regular reports from, among others, the Chief Financial Officer, General Counsel, the Vice President of Tax and
the Corporate Controller as well as from representatives of internal audit, the company’s compliance committee and our
auditors. The Audit Committee makes regular reports to the Board of Directors. In addition, TripAdvisor has, under the
supervision of the Audit Committee, established procedures available to all employees for the anonymous and confidential
submission of complaints relating to any matter to encourage employees to report questionable activities directly to our
senior management and the Audit Committee.
x The Compensation Committee considers and evaluates risks related to our cash and equity-based compensation programs,
policies and practices and evaluates whether our compensation programs encourage participants to take excessive risks that
are reasonably likely to have a material adverse effect on TripAdvisor or our business. Consistent with SEC disclosure
requirements, the Compensation Committee working with management has assessed the compensation policies and
practices for our employees, including our executive officers, and has concluded that such policies and practices do not
create risks that are reasonably likely to have a material adverse effect on TripAdvisor.
Ultimately, though, management is responsible for the day-to-day risk management process, including identification of key risks
and implementation of policies and procedures to manage, mitigate and monitor risks. In fulfilling these duties, management
conducted an enterprise and internal audit risk assessment and will use the results of that assessment in its risk management efforts. In
addition, management has formed a Compliance Committee in connection with the implementation, management and oversight of a
corporate compliance program to promote operational excellence throughout the entire organization in adherence with all legal and
regulatory requirements and with the highest ethical standards
Director Nominations
Given the ownership structure of TripAdvisor and our status as a “controlled company,” the Board of Directors does not have a
nominating committee or other committee performing similar functions or any formal policy on director nominations. The Board of
Directors does not have specific requirements for eligibility to serve as a director of TripAdvisor, nor does it have a specific policy on
diversity; however, the Board of Directors does consider, among other things, diversity when considering nominees to serve on our
Board of Directors. We broadly construe diversity to mean diversity of opinions, perspectives, and personal and professional
experiences and backgrounds, such as gender, race and ethnicity, as well as other differentiating characteristics. In evaluating
candidates, regardless of how recommended, the Board of Directors considers whether the professional and personal ethics and values
of the candidate are consistent with those of TripAdvisor, whether the candidate’s experience and expertise would be beneficial to the
Board in rendering service to TripAdvisor, including in providing a mix of Board members that represent a diversity of backgrounds,
perspectives and opinions, whether the candidate is willing and able to devote the necessary time and energy to the work of the Board
of Directors, and whether the candidate is prepared and qualified to represent the best interests of TripAdvisor’s stockholders.
Pursuant to the Governance Agreement, LTRIP has the right to nominate a number of directors equal to 20% of the total number
of the directors on the Board of Directors (rounded up to the next whole number if the number of directors on the Board is not an even
multiple of five) for election to the Board of Directors so long as certain stock ownership requirements are satisfied. LTRIP has
nominated Messrs. Maffei and Shean as nominees for 2015. The other nominees to the Board of Directors were recommended by the
Chairman and then were considered and recommended by the entire Board of Directors.
The Board of Directors does not have a formal policy regarding the consideration of director candidates recommended by
stockholders, as historically TripAdvisor has not received such recommendations. However, the Board of Directors would consider
such recommendations if made in the future. Stockholders who wish to make such a recommendation should send the
recommendation to TripAdvisor, Inc., 141 Needham Street, Newton, Massachusetts 02464, Attention: Secretary. The envelope must
contain a clear notation that the enclosed letter is a “Director Nominee Recommendation.” The letter must identify the author as a
stockholder, provide a brief summary of the candidate’s qualifications and history and be accompanied by evidence of the sender’s
stock ownership, as well as consent by the candidate to serve as a director if elected. Any director candidate recommendations will be
reviewed by the Secretary and, if deemed appropriate, forwarded to the Chairman for further review. If the Chairman believes that the
candidate fits the profile of a director nominee as described above, the recommendation will be shared with the entire Board of
Directors.