Staples 2015 Annual Report Download - page 20

CORPORATE GOVERNANCE
16 STAPLES Notice of Annual Meeting of Stockholders
Executive Committee
Ronald L. Sargent
Chairperson
“The Executive Committee provides an opportunity to
leverage the strength and diversity of our Board for guidance
when urgency is needed to act in the best interests of
shareholders.”
Other Committee
Members
Basil L. Anderson
Rowland T. Moriarty
Robert E. Sulentic
Vijay Vishwanath
Meetings in 2015
1 in person, 1
telephonic
Introduction
The Executive Committee is authorized to exercise all of the powers of our Board in the management
and affairs of Staples, with certain exceptions. A quorum can only be established by the presence of
both a majority of the members of the Executive Committee and two non-management members of
the Executive Committee.
Key Objective
It is intended that the Executive Committee will take action only when reasonably necessary to
expedite our interests between regularly scheduled Board meetings.
2015 Highlights
The Executive Committee met twice during the year, with additional directors in attendance to
provide guidance on the discussions with the shareholder that proposed director candidates for our
2015 Annual Meeting.
RISK OVERSIGHT BY THE BOARD OF DIRECTORS
Our Board of Directors is ultimately responsible for reviewing
and approving our risk management strategy and framework
and key risk parameters. In terms of overseeing the broader
ERM program, the Audit Committee, under powers delegated
by the Board, is responsible for the review and approval of our
risk management framework and ensuring that appropriate
policies and practices are in place for risk assessment and
management, including that all risk areas are being monitored
by senior management, reported to the Board or appropriate
Board committee by senior management and addressed as
needed. The Audit Committee also provides oversight with
respect to risks relating to the Company’s accounting and
financial reporting processes, the integrity of the Company’s
financial statements, and technology and cybersecurity,
including our response to significant data security incidents. At
each quarterly Board meeting, the Audit Committee reports to
the Board on all of its specific activities.
Our most senior executives are responsible for collaborating
with the Audit Committee to provide oversight to the risk
management process and prioritize and validate key risks.
Management is then responsible for implementing the Board
and Board committee approved risk management strategy and
for developing policies, controls, processes and procedures to
identify and manage risks.
Senior members of management make up our Enterprise
Risk Committee, which meets at least quarterly to coordinate
information sharing and mitigation efforts for all types of risks,
sometimes working with outside advisors. The Audit Committee
stays apprised of significant actual and potential risks faced
by Staples and the effectiveness of its risk assessment and
management process in part through detailed presentations
at least twice a year from the Vice President of Internal Audit
as the representative of the Enterprise Risk Committee, and
detailed presentations from senior executives responsible to
address specific risks and implement mitigation strategies. In
2015, management presented to the Audit Committee the
results of its enterprise wide review of the major financial,
operational and legal risks facing the company. For the most
important risks, senior executives presented their mitigation
strategies, which had been reviewed by the Enterprise Risk
Committee. Management also reviewed with the Audit
Committee its ERM methodologies for identifying and
prioritizing financial, operational and legal risks and discussed
the top level risks and related risk management.
In 2015, as part of the ERM process, significant attention was
given to implementation of the Company’s information security
strategy. In addition, the Audit Committee was integrally
involved in overseeing the response to the data security
incident announced in 2015. The Audit Committee provides
oversight to management with respect to network security
enhancements and other projects underway by the Global
Technology team.
Independent of the enterprise risk management process, the
Audit Committee is made aware of risks as a result of being
briefed in person regularly by our Vice President of Internal
Audit, as well as an annual briefing and quarterly reports by
our Director of Global Ethics & Compliance on compliance
and ethics matters. These reports also are provided to the
Board. The Audit Committee also meets regularly with the
General Counsel and at least quarterly, in executive session,