Good Governance

Good Governance

Board Leadership and Oversight

Strong leadership and effective oversight have remained of critical importance as companies navigate ongoing uncertainty and volatility, greater external scrutiny and heightened expectations of their role in addressing many of society’s most significant challenges. Our commitment to and guiding principles for strong governance continue to provide an important foundation for our Company as we navigate these challenges and respond to new opportunities.

The key principles and practices we follow include:

  • Fully independent Board Committees
  • Annual assessment and determination of the Board’s leadership structure
  • Election of a Lead Director, with significant governance responsibilities if the Chairman/CEO roles are combined
  • Annual review of the Company’s key legal and compliance risks, including mitigation strategies and compliance priorities, and review of the conclusions and recommendations generated by the Company’s Enterprise Risk Management (ERM) process
  • Significant Director interaction with senior business leaders, both in business and operations reviews and in oversight of succession planning
  • Board review of and engagement in key aspects of ESG, including our Environmental sustainability strategy and progress, efforts to promote Equality & Inclusion within the Company and in society broadly, and work to make a positive Community Impact through providing COVID-19 relief and other critical humanitarian support

We describe these and other practices in our Corporate Governance Guidelines and in each Committee’s charter, which we continually assess and update as appropriate based on feedback from our investors and stakeholders and our own review of external best practices. For example, we are a signatory to the Commonsense Corporate Governance Principles 2.0, reflecting our commitment to a foundation of effective governance. Further, we assess our practices against external benchmarks like the Investor Stewardship Group’s Corporate Governance Principles, generally finding that our practices closely align with these ideals. Overall, we believe our approach to governance strengthens the Board’s ability to provide meaningful oversight, review and counsel to the Company, as it acts on behalf of all our shareholders.

As a key component of its oversight, the Board and its committees devote substantial time, not only to strategy but to the review of significant subjects, such as ethics and compliance, cybersecurity, environmental sustainability and human capital management. The full Board provides strategic oversight and monitors emerging priorities and risks in these and other areas, while each committee devotes further attention to particular matters within its scope.

Audit Committee

Oversees the Company’s overall risk management process, including financial controls and integrity and meets regularly with the chief ethics and compliance officer, reviewing key enterprise risks and cybersecurity programs.

For example, this past year, the Audit Committee received routine updates from the Company’s Chief Information Officer on the Company’s information security program, including the outcomes of the annual, independent third-party assessment of our program’s progress and maturity based on the NIST Cyber Security Framework.

Governance & Public Responsibility Committee

Oversees matters related to the Company’s corporate governance practices and policies, including Board composition, Director succession planning and independence and oversees the Company’s geo-political risks and community and environmental impact, assessing our practices and progress against key benchmarks.

For example, the G&PR Committee reviewed the Company’s final outcomes on our 2020 sustainability goals, progress and challenges on our Ambition 2030 goals and strategies for closing gaps and accelerating progress. The G&PR Committee further engaged on the Company’s intention to publish a climate transition action plan.

Compensation & Leadership Development Committee

Oversees the development and succession planning of the Company’s CEO and other executive officers, monitors gender pay equity, reviews organizational equality and inclusion programs and progress and ensures our executive compensation practices are balanced in rewarding holistic, long-term growth.

For example, the Compensation & Leadership Development (C&LD) Committee continues to review and discuss the Company’s equality and inclusion strategies, including efforts to inspire and reward courageous and inclusive leadership, and the Company’s progress against its representation goals.

Innovation & Technology Committee

Oversees the Company’s innovation and technology programs, including the responsible integration of new technology into our innovation strategy, while also considering how these programs incorporate the Company’s sustainability and ingredient safety priorities.

For example, the I&T Committee recently reviewed the Company’s efforts to continue to deliver irresistible superiority, while providing more environmentally conscious and socially responsible products, discussing with senior R&D executives how the Company’s innovation portfolio can increasingly address these key consumer priorities.

This broad scope of Board and Committee oversight and the resulting active engagement of our Directors help ensure that our Company’s values, our leadership’s behaviors and our employees’ efforts are ultimately linked to our Company strategy in a meaningful and effective way.

Board Composition

As a global, diverse consumer products company, we strive to reflect the diversity of our workforce in our boardroom. Not only do our Directors bring to the Board significant and varied leadership skills and experiences, they represent a mix of background, age, gender, race and life experience that informs their leadership and strengthens their oversight.

On Our 12-Member Board:

Six (50%) members are women.
Four (33%) members are ethnically diverse.
Seven (58%) members have served fewer than five years, with average tenure of less than six years.
Eight (67%) members are current or former public company CEOs.

The Board’s overall diversity is a key priority and significant consideration in our Director nomination process.