Big Lots 2011 Annual Report Download - page 21

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GOVERNANCE
Board Leadership and Presiding Director
The Board is currently comprised of the individuals identified in Proposal One other than Mr. Chambers. Aside
from Mr. Fishman, each of the other nominees and Mr. Kollat are independent as defined by the applicable NYSE
and SEC rules), non-employee directors (“outside directors”). Mr. Fishman is our Chief Executive Officer (“CEO”)
and serves as Chairman of the Board. The Board also has a presiding director whose primary responsibility is to
lead executive sessions of the Board in which our CEO and other members of management are not present. The
role of presiding director is rotated quarterly among the outside directors. The presiding director is responsible
for establishing an agenda for the session over which he or she presides and, upon the conclusion of an executive
session of the Board, meeting with our CEO to address the matters discussed during the executive session.
We believe that the current structure of the Board provides both independent leadership and the benefits afforded
by having our CEO also serve as Chairman of the Board. As the individual with primary responsibility for
managing our day-to-day operations, our CEO is best positioned to chair regular Board meetings as we discuss key
business and strategic issues. Coupled with an independent presiding director, this structure provides independent
oversight while avoiding unnecessary confusion regarding the Board’s oversight responsibilities and the day-to-day
management of our business operations. The Board also believes that Mr. Fishman’s leadership, integrity and vision
have been instrumental in our success and that he has the ability to execute both the short-term and long-term
strategies necessary in the competitive marketplace in which we operate. Additionally, we have implemented
mechanisms that we believe will ensure that we continue to maintain high standards of corporate governance and
the continued accountability of our CEO to the Board, including a super-majority of independent outside directors
on the Board, the use of a presiding director, and the appointment of only independent outside directors to chair
and serve on each of our standing Board committees.
Board Meetings in Fiscal 2011
Five meetings of the Board were held during fiscal 2011. During fiscal 2011, each director attended at least 75% of
the aggregate of meetings of the Board and all meetings held by the committees on which he or she served (in each
case, held during the periods that he or she served). It is our policy that each director nominee standing for election
be present at the annual meeting of shareholders. Other than Mr. Chambers, each director named in Proposal One
and Mr. Kollat attended the most recent annual meeting of shareholders held in May 2011. Under our Corporate
Governance Guidelines, each director is expected to dedicate sufficient time and attention to ensure the diligent
performance of his or her duties, including attending meetings of the shareholders, the Board and the committees
of which he or she is a member.
Role of the Board’s Committees
The Board has standing Audit, Compensation, and Nominating / Corporate Governance Committees. The Board
also has a Strategic Planning Committee. Each committee reports on its activities to the Board.
Audit Committee
The primary function of the Audit Committee is to assist the Board in fulfilling its oversight responsibility
with respect to: (1) the integrity of the financial reports and other financial information provided by us to our
shareholders and others; (2) our compliance with legal and regulatory requirements; (3) the engagement of our
independent registered public accounting firm and the evaluation of the firm’s qualifications, independence
and performance; (4) the performance of our system of internal controls; (5) our audit, accounting and financial
reporting processes generally; and (6) the evaluation of enterprise risk issues. The Audit Committee was
established in accordance with the Securities Exchange Act of 1934, as amended (“Exchange Act”), and each of
its members is independent as required by the Audit Committee’s charter and by the applicable NYSE and SEC
rules. The Board has determined that each member of the Audit Committee satisfies the standards for an “audit
committee financial expert,” as defined by applicable SEC rules, and is “financially literate,” as required by
NYSE rules.