Glatfelter's Board of Directors (the "Board") is charged with providing effective governance over the Company’s business for the benefit of its shareholders, and has approved the following Governance Principles. The Governance Principles, which provide a framework for the Board’s responsibilities, are in addition to, and are not intended to change or interpret, any Federal or state law or regulation, the New York Stock Exchange ("NYSE") listing standards, the Articles of Incorporation, or the By-Laws of the Company. The principles and guidelines herein are subject to modification from time to time by the Board.
Glatfelter's business is conducted by its officers, managers and employees, under the direction of the Chief Executive Officer ("CEO") and the oversight of the Board, which is comprised of a majority of independent directors. The Board is elected by the Company’s shareholders and is responsible for the oversight of the business and affairs of the Company. The Board shall carry out its responsibility by establishing the strategic direction for the Company’s business and by selecting, evaluating, advising and monitoring executive management, and shall ensure that the long-term interests of the Company as a whole, and its shareholders, are served by the conduct of the business operations. The Board and management recognize that, in addition to the shareholders, other stakeholders in the business include employees, retirees, contractors, customers, suppliers, government and regulatory officials, as well as the communities in which the Company operates. The Board and management believe that recognizing the interests of these stakeholders is fundamental to being able to provide value to shareholders.
& Chief Executive Officer
Currently, the CEO is also the Chairman of the Board of Directors. The Chairman and CEO presides at all meetings of the shareholders and is responsible to the Board for the day-to-day management of the Company. The Chairman and CEO proposes, with the involvement of the Board, the schedule, agenda and materials for the meetings of the Board over which he presides. Each year, the Board elects one of its members to serve as Chairman. The Board reviews its governance structure and the qualifications of each director and determines which director is best qualified to chair the Board. The Board believes that the Company and its shareholders are best served by having a Chairman who has a wide-ranging, in-depth knowledge of the Company’s business operations and the competitive landscape and who can best execute the strategic plan, based on his or her extensive experience and knowledge of the Company’s operations, industry, competitive challenges and opportunities.
3. Lead Director
As the Chairman is currently also the CEO, the Nominating & Corporate Governance Committee (the “Governance Committee”) each year nominates and the independent directors elect one of the independent directors to be the Lead Director. The Lead Director presides over the executive sessions of the Board and coordinates and develops the agenda for such executive sessions. The Lead Director shall communicate to the Chairman and CEO regarding the discussions at executive sessions as appropriate. In addition, in the absence or disability of the Chairman, the Lead Director has the authority and performs the duties of the Chairman, as provided in Section 2.18 of the Company’s By-Laws, including presiding at any Board meeting at which the Chairman is not in attendance.
The Board annually appoints executive officers of the Company at its organizational meeting following the Annual Meeting of Shareholders and at such other times as it may deem appropriate. A listing of the Company’s current officers, as well as its directors, may be found at http://www.glatfelter.com/about_us/executive_leadership/default.aspx.
Board of Directors
The Board holds a minimum of five (5) regularly scheduled meetings a year at which it reviews and discusses reports by management on the performance of the Company, strategic options, and other significant issues faced by the Company. The Board approves the annual schedule of meetings, and the initial outline of core agenda items provided with such schedule, for regular meetings of the Board and the standing Board Committees. The Chairman or any director may also convene special meetings of the full Board or the non-management directors, as appropriate, and the Lead Director will act as a liaison between the Chairman and the non-management directors, following such a meeting when the Chairman is absent. The full Board considers all major decisions affecting the Company. Directors are expected to attend all scheduled Board meetings and meetings of committees of which they are members. In addition to its general oversight of management, the Board, either directly or through its committees, also performs a number of specific functions, including:
In executing these functions,
directors have regular interaction with management and consult with independent
advisors as necessary and appropriate.
Non-management directors meet in regularly scheduled executive sessions (without management) as part of the Board of Directors meetings.
The Board has established a method for interested parties to communicate directly with the entire Board, the Lead Director or any other independent director by calling the Company’s toll-free Helpline (800-346-1676).
The entire Board conducts an annual self-evaluation to determine the effectiveness of the Board and its committees.
2. Board Members
Independent directors, as defined by the NYSE listing standards and any applicable laws or regulations, shall constitute a majority of the Board. Generally, to meet the standard for "independence," a director must not be an employee of the Company nor have any material relationship with the Company, as affirmatively determined by the Board and disclosed in the proxy statement by the Board of Directors. The Board adopts the New York Stock Exchange definition of "independent director" as one who has no material relationship with the Company (either directly or as a partner, shareholder or officer of an organization that has a relationship with the Company). The Board will consider all relevant facts and circumstances in assessing the materiality of a director's relationship with the Company. The Board will consider the issue both from the standpoint of the director and from that of organizations with which the director has an affiliation. Material relationships can include commercial, industrial, banking, consulting, legal, accounting, charitable and familial relationships (among others).
The Board presently consists of nine (9) persons, comprising one class of directors, all with terms expiring at the Annual Meeting of Shareholders each year. The directors are elected annually to hold office for a term until the next Annual Meeting of Shareholders and until their successors have been duly elected and qualified. The Governance Committee determines the appropriate mix of skills and characteristics required to best fill the needs of the Board at a given point in time and periodically reviews and updates the criteria as deemed necessary. The Board believes that diversity in personal background, professional experience, qualifications, attributes and skills are important considerations in selecting candidates. In recommending a candidate for election as a director, the Governance Committee will consider, at a minimum, the candidate’s independence, professional experience, knowledge of the Company’s business or industry, skills, expertise, wisdom, integrity, business acumen and availability to devote the necessary time to serve on the Board.
Each year the Governance Committee considers the needs of the Board, reviews the performance of directors and information about the incumbents and other potential director candidates, and recommends a slate of director candidates to nominate for election at the Annual Meeting of Shareholders. When the Governance Committee considers candidates for election as directors, the Governance Committee will consider candidates who have been proposed by the Governance Committee or by shareholders and will use the same procedures and criteria to evaluate each director candidate without regard to whether the candidate was nominated by the Governance Committee or by a shareholder, but the Governance Committee has the sole discretion to recommend director candidates for election to the Board. Directors are usually elected by shareholder vote at the annual meeting of shareholders. Between annual meetings, on the recommendation of the Governance Committee, the Board may elect directors to fill vacancies. The Board may vote to decrease or increase its size and fill vacancies created by an increase in its size, upon the Governance Committee's recommendation. In the case of a vacancy on the Board, the Board itself may fill that vacancy by electing a director to serve until the next Annual Meeting of Shareholders and until his or her successor has been elected and qualified, or until his or her earlier death, resignation, or removal.
The Board has a mandatory retirement policy. When a term of a director extends beyond the date when the director reaches the age qualification set forth in Section 2.2 of Article II of the Company’s Bylaws (“Qualifying Age”), such director must resign from the Board effective at the next Annual Meeting of Shareholders following such birthday. Under the Company’s By-laws, the Board has the discretion, on a case-by-case basis, to not accept the resignation of a director who has reached the Qualifying Age if it determines, on the recommendation of the Governance Committee, that the director's continued service (on a year-to-year basis) is necessary to retain his or her skills, or to maintain diversity of the Board.
A director who retires from, or substantially changes, his or her principal position of employment must, promptly following such retirement or change in position, tender his or her resignation to the Chair of the Governance Committee. The tendered resignation must provide that, unless otherwise determined by the Board in its sole discretion, the tendered resignation will be effective immediately upon acceptance by the Board. The Governance Committee will, after consultation with the Chief Executive Officer, consider the tendered resignation and make a recommendation to the Board as to whether the Board should accept or reject the tendered resignation. The Board will decide, in its sole discretion, whether to accept or reject such resignation. The Company does not limit the number of boards of publicly traded companies on which a director may serve. However, a director who is considering serving on the Board of Directors of another publicly traded company should comply with the Board’s policy regarding approval of outside directorships and promptly advise the Chairperson of the Governance Committee. The Chairperson will consult with the CEO to determine if there are any competitive or other business issues which could arise from the director serving on the additional Board. The Chairperson, and if advisable the Governance Committee, will then consider the effect that these additional responsibilities could have on the director’s independence and performance of his/her duties as a director of the Company, and will take such action as he or it may deem appropriate and in the best interests of the Company. The Company expects all directors to devote sufficient time and effort to their duties as a Glatfelter Board member, and adhere to the Company’s Director Orientation and Continuing Education Policy in order to maintain the skill and knowledge necessary to meet their obligations as directors. These are factors that are considered in the annual Board self-evaluation process.
3. Board Committees
The Board shall at all times have a committee structure that is adequate for the conduct of the business of the Board of Directors and required for the operation of a publicly owned company. Currently, the Company has four standing committees, consisting of: (a) Audit, (b) Compensation, (c) Governance and (d) Finance. The Board may, from time to time, create additional committees or terminate existing ones, if required. Committees support the role of the Board on issues that benefit from consideration by a smaller, more focused group of directors. The committees, whose chairpersons are appointed by the Board, shall have regularly scheduled meetings, and call additional meetings as appropriate. A management representative is assigned to each committee for purposes of planning meeting agendas and coordinating communications between management and the committee.
The office of the Corporate
Secretary is responsible for providing notice of the committee meetings and
sending documents provided by the management representative(s) in advance of
the meeting, as well as taking minutes of the committee meetings. The committee
chairpersons routinely report on their committee activities to the Board at the
next regular Board meeting following a committee meeting.
The purposes of each committee are defined in the Company’s By-Laws and in their respective charters. The committee charters and information about the current composition of each committee are accessible by following the hyperlinks provided on the Corporate Governance page of the Company's public website at http://www.glatfelter.com/about_us/corporate_governance/default.aspx
The Company's annual proxy statement contains complete information about director compensation (which may vary based on factors such as committee service and number of meetings attended) and director benefits. To further align director’s interests with those of the shareholders, the Company has established share ownership guidelines for its non-employee directors. The Company's annual proxy statement contains a comprehensive description of the share ownership guidelines applicable to the Company’s non-employee directors.
In an election of directors, where the Board of Directors determines that the number of nominees exceeds the number of directors to be elected, the directors shall be elected by a plurality of the votes cast. If in an election of directors in which the number of nominees does not exceed the number of directors to be elected, any nominee who is not an incumbent director receives a plurality of the votes cast but does not receive a majority of the votes cast, the resignation of such nominee referred to below will be automatically accepted. If the nominee is an incumbent director who is standing for re-election and such nominee receives a plurality of the votes cast but does not receive a majority of the votes cast, the Governance Committee will make a recommendation to the Board of Directors on whether to accept the director’s resignation or whether other action should be taken. The independent members of the Board of Directors will consider the Committee’s recommendation and publicly disclose the Board of Directors’ decision and the basis for that decision within 90 days from the date of the certification of the final election results.
In making their determinations, the Governance Committee and the Board may consider any factors or other information that they consider appropriate or relevant. Any director who tenders his or her resignation pursuant to this provision shall not participate in the Governance Committee’s recommendation or Board action regarding whether or not to accept the resignation. If less than two members of the Governance Committee are elected at a meeting for the election of directors, the independent members of the Board of Directors who were elected shall consider and act upon the tendered resignation. If three or less directors are elected in the same election, all directors may participate in the action regarding whether to accept the resignations, provided, however, that each director’s resignation will be acted upon separately and no director may participate in the Board action regarding whether or not to accept his or her resignation. A director whose resignation is not accepted by the Board shall continue to serve until the next annual meeting at which he or she is up for election and until his or her successor is duly elected, or until his or her earlier resignation or removal. If a director’s resignation is accepted by the Board, or if a nominee for director who is not an incumbent director is deemed to have been elected and to have immediately resigned, then the Board, in its sole discretion, may fill any resulting vacancy pursuant to Section 2.5 of Article II of the Company’s By-Laws or may amend the Company’s By-Laws to decrease the size of the Board. The Governance Committee shall make a recommendation to the Board as to whether or not it should fill the vacancy or amend the Company’s By-Laws to reduce the size of Board. To be eligible to stand for election, each person who agrees to be nominated must also execute a written statement setting forth an irrevocable resignation and that such person agrees to be bound by this provision.
of Independent Auditors
The Board will submit the Audit Committee’s appointment of the independent registered public accounting firm to the Company’s shareholders for ratification at the Annual Meeting of Shareholders each year. If the shareholders fail to ratify the Audit Committee’s selection, the Audit Committee will reconsider its selection of the independent registered public accounting firm at such time and in such manner as the Audit Committee may determine in its sole discretion. The Audit Committee may in its discretion appoint a different independent registered public accounting firm at any time during the year if the Audit Committee determines that a change is in the best interests of the Company.
7. Conduct and
Ethics Standards for Directors
Directors are subject to the applicable provisions set forth in the Company's Code of Business Conduct (1.67 MB PDF). Directors fulfill their duties in a manner that avoids actual, potential or perceived conflicts of interest and that protects the Company’s reputation for honesty and integrity. Except as authorized by the Board, no non-management director shall have a direct economic relationship with the Company other than ownership of shares of the Company’s Common Stock or options to purchase such shares. Both Company loans to the directors or their family members, and guarantees of obligations of the directors or their family members are prohibited.
Directors owe a duty to advance the Company’s interests and are, therefore, prohibited from taking a business opportunity that is discovered through the use of Company property, information, or position, for their personal benefit. Directors shall meet at least annually with the Company’s General Counsel or Director of Compliance in order to review compliance standards in the Company’s Code of Business Conduct and any other policy governing conduct that applies to the Company generally and to themselves specifically as directors. Any reports of violations of the Company’s Code of Business Conduct may be reported through the Code of Conduct Helpline (800-346-1676), to the Vice President, General Counsel and Secretary, the Director of Compliance, or to the Audit Committee Chairperson. Retaliation is prohibited for complaints made or concerns raised through these channels.
The Company’s General Counsel or Director of Compliance provides an annual compliance report to the Board, as well as to the Audit Committee.
Approved by the Board of Directors
on December 17, 2003
Affirmed by the Board of Directors on December 15, 2004
Amended by the Board of Directors on December 14, 2005
Amended by the Board of Directors on March 8, 2006
Amended by the Board of Directors on March 5, 2008
Amended by the Board on February 18, 2009
Amended by the Board on December 15, 2010
Updated to conform with NCG Charter on February 22, 2011
Amended by the Board, September 20, 2011
Updated to conform with revised by-laws and Code of Conduct, March 2012
Reviewed by the NCG Committee and recommended for board approval on December 3, 2012
Approved by the Board of Directors on December 12, 2012
Approved by the Board of Directors on December 12, 2013