Nominating/Corporate Governance Committee
Together with the audit and compensation committees, the nominating/corporate governance committee rounds out the three standing committees of a public company’s board of directors. It plays a critical role in overseeing matters of corporate governance for the board, including formulating and recommending governance principles and policies. As its name implies, this committee is charged with enhancing the quality of nominees to the board and ensuring the integrity of the nominating process. Given the recent focus on board composition and diversity, director elections, and proxy access, the role of nominating/corporate governance committee is in the spotlight.
Role of Nominating/Corporate Governance Committee
The role of the committee may include the following:
- Director recruitment
- CEO succession planning
- Monitor governance processes
- Oversee board and committee evaluations/assessments
- Take the lead on information about director orientation and ongoing education
- Respond to investors on proxy issues/maintain knowledge of investor viewpoints
- Familiarity with company governance ratings
Do You Know?
The NYSE corporate governance listing standards require listed companies to establish a separate nominating committee or delegate the responsibilities to another separate committee composed entirely of independent directors, while the NASDAQ listing standards permits a majority of the company’s independent directors to carry out the responsibilities of the nominating committee. The SEC requires a company to disclose in its proxy statement whether each member of the nominating committee is independent.