ryder system, inc.

compensation committee charter


Purposes

The purposes of the Compensation Committee of the Board of Directors of Ryder System, Inc. are to (a) assist the Board of Directors in fulfilling its overall responsibilities with respect to (i) the evaluation and compensation of the Company’s Chief Executive Officer (“CEO”); (ii) the appointment of officers, (iii) the establishment of salaries, incentives and other forms of compensation for executive officers, directors and exempt employees and (iv) the establishment and administration of incentive compensation, benefit and stock-related plans provided to employees of the Company; and (b) prepare the Committee’s report, made pursuant to the Securities Exchange Act of 1934, to be included in the Company’s annual proxy statement. 

Composition of the Committee

Number.  The Board of Directors shall determine the size of the Committee, but it must consist of no fewer than three members.

Qualifications.  Each Committee member shall meet the independence criteria of the rules of the New York Stock Exchange, Inc., as such requirements are interpreted by the Board of Directors in its business judgment and shall be free of any relationship that, in the opinion of the Board of Directors, may interfere with his or her exercise of independent judgment as a Committee member.  Desirable qualifications for Committee members include experience in business management, executive compensation, employee benefits, and human resources.

Appointment.  The Board of Directors will appoint the members and the Chairman of the Committee based on recommendations made by the Company’s Committee on Directors and Public Responsibility.  Committee members shall serve at the pleasure of the Board of Directors and for such term or terms as the Board of Directors may determine.

Duties and Responsibilities of the Committee

The Committee is responsible for overseeing the planning, design and implementation of the Company’s overall compensation and benefits strategies, including with respect to salaries, benefit plans, incentive compensation plans, stock-related plans and director compensation, in each case taking into account appropriate industry benchmarks and the compensation policies followed by companies similarly situated to the Company. 

The Committee shall have the following specific responsibilities:

Responsibilities Relating to Benefit, Incentive Compensation and Stock-Related Plans

1)       1)                   Periodically review and discuss the Company’s existing benefit plans, and based on such review and discussion, approve significant changes to such benefit plans and take such actions in respect to such benefit plans as the Committee deems appropriate.  Evaluate, and make recommendations to the Board of Directors with respect to the approval and adoption of, new significant benefit plans.  Significant new plans and significant changes to existing benefit plans are defined as those with an incremental cost to the Company of at least $1 million annually.   Review, discuss and approve the appointment of the members of the Company’s various benefit plan administration committees.

2)       2)                   Periodically review and discuss the Company’s existing executive compensation plans and unless otherwise specified herein, based on such review and discussion, approve changes to such executive compensation plans and take such actions in respect to such executive compensation plans as the Committee deems appropriate.  Evaluate, and make recommendations to the Board of Directors with respect to the approval and adoption of, new executive compensation plans.

3)       3)                   Periodically review and discuss the Company’s existing incentive compensation plans, and based on such review and discussion, approve changes to such incentive compensation plans and take such actions in respect to such incentive compensation plans as the Committee deems appropriate.  Evaluate, and make recommendations to the Board of Directors with respect to the approval and adoption of, new incentive compensation plans. Such new incentive compensation plans or changes to existing incentive compensation plans shall be designed to reinforce the Company’s key business objectives and “pay for performance” philosophy.

4)       4)                   Review and approve total amounts paid out under executive incentive plans to ensure that the integrity of each plan is maintained and that bonuses are awarded on a systematic and equitable basis.  Approve bonus payouts for officers of the Company and make recommendations to the Board of Directors with respect to bonus payouts for any Company employee that serves on the Board of Directors (a “Management Director”).

5)       5)                   Periodically review and discuss the Company’s existing stock-related plans, and based on such review and discussion, approve changes to such stock-related plans (other than changes that would require shareholder approval) and take such actions in respect to such stock-related plans as the Committee deems appropriate, all as permitted by the terms of the stock-related plan.  Evaluate, and make recommendations to the Board of Directors with respect to the approval and adoption of, new stock-related plans as well as changes to existing stock-related plans that would require shareholder approval.

6)       6)                   Review and approve the administration of the Company’s stock-related plans and other plans adopted by the Board of Directors that contemplate administration by the Committee.  With respect to any such stock-related plans, the Committee shall interpret the terms and provisions of the stock-related plans and render decisions on any material matter relating thereto, and shall exercise all rights, powers and authority reserved to, and perform all duties placed upon, the Committee under the provisions of the stock-related plans.

7)       7)                   Review and approve equity awards to executives of the Company and make recommendations to the Board of Directors with respect to equity awards to Management Directors.  Review and discuss all other equity awards to ensure that the integrity of the plan is maintained and that the awards are equitable and consistent.  If permitted by the terms of a stock-related plan, the Committee may delegate its responsibility to approve equity awards (other than  equity awards to any Management Director) provided that the Committee receives, at least annually, a report from management detailing any such equity award grants.

Responsibilities Relating to CEO Evaluation and Compensation

8)       8)                   Review and approve corporate goals and objectives relevant to the compensation of the CEO.

9)       9)                   Evaluate the CEO’s performance in light of the goals and objectives set by the Committee.

10)   10)                Based on the Committee’s evaluation of the CEO’s performance, recommend to the independent directors of the Board of Directors, the compensation of the CEO.

Responsibilities Relating to Salaries and Other Compensation

11)   11)                Review, discuss and approve annual salary range and merit increase policy recommendations for exempt employees.

12)   12)                Review, discuss and approve salary and other compensation actions for direct reports to the CEO and other positions as designated by the Committee from time to time.  Recommend to the independent directors of the Board of Directors salary and other compensation actions  for Management Directors.

13)   13)                Periodically review and discuss the compensation and benefits of non-Management Directors and make recommendations to the Board of Directors with respect thereto.

Responsibilities Relating to the Appointment of Officer

14)14)             Approve the appointment of all new officers of the Company and recommend to the Board of Directors the appointment of all officers of the Company at the executive vice president level and above.

Other Responsibilities

15)15)             Review and discuss all new and amended employment and severance agreements and, with respect to executive officers whose salary and other compensation actions would require approval of the Board of Directors, make recommendations to the Board of Directors with respect thereto.

16)16)             Periodically review management reports which identify major compensation and benefit objectives and assess the Company’s posture relative to these objectives.

17)      Oversee, in consultation with appropriate officers of the Company, regulatory compliance with respect to compensation matters, including overseeing any compensation programs intended to preserve tax deductibility.

18)      Review and discuss other matters that relate to the Company’s compensation and benefits strategies as the Committee may, in its own discretion, deem desirable in connection with the functions described above. 

19)      Review (in conjunction with the Company’s Corporate Governance and Nominating Committee), on an annual basis, the slate of persons to be appointed to the Company’s Retirement Committee.

20)      Approve the appointment of new members to the Company’s Retirement Committee during the year. 

21)      Periodically review actions taken by the Retirement Committee to ensure equitable and consistent administration of compensation and benefits programs.

22)      Report its activities regularly to the Board of Directors in such manner and at such times as the Committee and/or the Board of Directors deem appropriate. 

Meetings of the Committee

The Committee shall meet at least four times per year.  The Chair of the Committee shall, in consultation with the other members of the Committee and appropriate officers of the Company, be responsible for calling meetings of the Committee, establishing the agenda therefor and supervising the conduct thereof.  The Committee may also take any action permitted hereunder by unanimous written consent.

The Committee may request any officer or employee of the Company or the Company’s outside legal counsel, to attend a meeting of the Committee or to meet with any members of, or consultants to, the Committee.  Any individual whose compensation is to be discussed at a Committee meeting should not attend that part of such meeting where his or her compensation is to be discussed unless specifically invited by the Committee.  Any Committee member may be excused from a meeting to permit the remaining members of the Committee to act on any matter in which such member's participation is not appropriate, and such member's absence shall not destroy the quorum for the meeting.

Resources and Authority of the Committee

The Committee shall have the resources and authority appropriate to discharge its responsibilities, including the authority to retain compensation consultants, outside legal counsel and other advisors as the Committee deems necessary to carry out its duties.

The Company will provide for appropriate funding, as determined by the Committee, for payment of compensation to compensation consultants, outside legal counsel and any other advisors retained by the Committee.

Compensation Committee Report

The Committee will prepare, with the assistance of management and legal counsel, a report for inclusion in the Company’s proxy statement relating to the Company’s annual meeting of shareholders.

Periodic Review of Charter

The Committee will conduct and review with the Board of Directors periodically an evaluation of this Charter and recommend any changes to the Board of Directors.  The Committee may conduct this Charter evaluation in such manner as the Committee, in its business judgment, deems appropriate.

Periodic Performance Evaluation

            On an annual basis, the Committee will conduct and review with the Board of Directors an evaluation of the Committee’s performance with respect to the requirements of this Charter.  The Committee may conduct this performance evaluation in such manner as the Committee, in its business judgment, deems appropriate. 

 

Adopted:  February 12, 2004

Amended: February 9, 2006