Baker Hughes 2009 Annual Report Download - page 61

2009 Proxy Statement 51
no more than one board of a publicly-held company or for
profit company. Members of Audit/Ethics Committee of the
Board may not simultaneously serve on the audit committees
of more than three public companies. If an independent direc-
tor serving on the Company’s Board is asked to join another
board of directors, prior notice shall be given to the Chairman
of the Governance Committee and the Corporate Secretary
of the Company. If an actual or potential conflict of interest
arises for a director or senior management, the individual shall
promptly inform the CEO or the Board. Any waivers of the
Company’s Business Code of Conduct for a director or senior
management will be determined by the Board or its designated
Committee and will be publicly disclosed.
Board Compensation and Evaluation Procedures
Compensation – The Governance Committee will annually
review compensation to determine director compensation and
recommend any changes to the Board.
Company Stock Ownership – Each independent director
is expected to own at least four times his or her annual retainer
in Company Common Stock. Such ownership level should be
obtained within a reasonable period of time following the
director’s election to the Board.
Evaluation – Any independent director may at any time
provide the Chairman of the Governance Committee an evalu-
ation of another independent director. Questions and observa-
tions regarding the evaluation of an independent director will
be referred, as necessary, to the Lead Director. The independent
directors will perform an annual evaluation on the performance
and effectiveness of the Audit/Ethics Committee in accordance
with the regulations of the Public Company Accounting Over-
sight Board.
Board Functions
Board Meetings – The Board will hold five regular meet-
ings per year to handle recurring business, with special meet-
ings called as appropriate. Directors are expected to attend all
scheduled Board and Committee meetings.
Special Meetings – The number of scheduled Board
meetings will vary with circumstances and special meetings
will be called as necessary.
Annual Meetings of Stockholders – The Company’s
Annual Meeting of Stockholders provides an opportunity each
year for stockholders to ask questions of or otherwise commu-
nicate directly with members of the Company’s Board on mat-
ters relevant to the Company. It is the Company’s policy to
request and encourage all of the Company’s directors and
nominees for election as directors to attend in person the
Annual Meeting of Stockholders.
Agenda Items – The Chairman will be responsible for
setting the agenda for and presiding over the Board meetings.
Individual directors are encouraged to contact the Chairman
with respect to any proposed agenda items that the director
believes should be on the agenda. The Corporate Secretary
will endeavor to timely provide to the directors all written
Board materials to be covered in regular meetings prior thereto.
Committees of the Board
The Board has constituted five standing Committees:
Governance Committee, Audit/Ethics Committee, Compensa-
tion Committee, Finance Committee and Executive Committee.
Each Committee is comprised solely of independent directors,
except for the Executive Committee. The Chairman of the
Board serves on the Executive Committee. Any independent
member of the Board may attend any Committee meeting
as an observer.
The Governance Committee annually proposes Committee
assignments and chairmanships to the Board. Each Committee
is elected by the Board, including the designation by the Board
of one person to serve as Chairman of each Committee. On
an annual basis, each Committee shall perform an evaluation
of the Committee and its activities.
Governance Committee
Purpose: The Committee’s purpose is to develop and rec-
ommend to the Board a set of corporate governance principles
applicable to the Company (“Corporate Governance Guide-
lines”) and to oversee compliance with, conduct reviews of
and recommend appropriate modifications to such Corporate
Governance Guidelines.
Principal Responsibilities: The Committee will have
the oversight responsibility for recruiting and recommending
candidates for election to the Board, with advice of the Com-
pany’s Chairman and CEO. The Committee will periodically
conduct a review of criteria for Board membership against
current needs of the Board to ensure timeliness of the criteria.
The Committee will also be responsible for monitoring compli-
ance with these Corporate Governance Guidelines adopted
by the Board, and updating such guidelines when appropriate.
The Committee will also review and recommend to the Board
the annual retainer for members of the Board and Committees
of the Board. The Committee’s Charter shall be posted on the
Company’s website.
Composition: The Committee will be comprised of not less
than three nor more than six of its independent directors. All
members of the Committee will be independent, as that term
is defined in the NYSE corporate governance listing standards.
Meetings: The Committee will meet at least two times
per year as determined by the Board with special meetings
called by the Board or the Committee as necessary.
Audit/Ethics Committee
Purpose: The Committee’s purpose is to assist the Board
with oversight of: (i) the integrity of the Company’s financial
statements and reporting system, (ii) the Company’s compli-
ance with legal and regulatory requirements, (iii) the indepen-
dent auditor’s qualifications and independence and (iv) the
performance of the Company’s internal audit function and
independent auditors. The Committee shall also prepare the
Audit/Ethics Committee Report to be included in the Compa-
ny’s proxy statement for the Annual Meeting of Stockholders,
conduct an annual self-evaluation and carry out the duties and
responsibilities set forth in its Charter.