The Board of Directors is responsible for the overall corporate governance of Wescast. The mandate of the Board is to oversee the Company’s business and affairs and the day-to-day conduct of business by management. The Board together with management strives to ensure the long-term creation of shareholder value and the preservation and protection of Company assets. The Board seeks to discharge this responsibility by reviewing, guiding and approving the Company’s strategic direction, evaluating the performance of the Company’s executives, monitoring the Company’s financial results, principal risks, integrity of internal controls and communication and corporate governance practices.
Although directors may be elected by the shareholders to bring special expertise or point of view to Board deliberations, they are not chosen to represent a particular constituency exclusively and must act honestly, in good faith, and in the best interests of shareholders.
Duties and Responsibilities
While the Board is called upon to supervise the management of the business, the Chairman & CEO is charged with the day-to-day leadership and management of the Company. The Board discharges its responsibilities both directly and through its committees, the Audit Committee, the Nominating & Corporate Governance Committee, and the Human Resources Committee. In addition to these regular committees, the Board may appoint ad hoc committees periodically to address issues of a more short-term nature. In addition to the Board’s legal obligations under the Business Corporations Act (Ontario) and any requirements specified in the Company’s by-laws, the Board bears principal responsibility for the following:
- Satisfying itself as to the Integrity of Management
- Take such actions as it deems necessary to satisfy itself as to the integrity of the Company’s chief executive officer (the “CEO”) and other members of the Executive Leadership Team (the “ELT”) and the creation by the CEO and members of the ELT of a culture of integrity throughout the Company.
- Adoption of a Strategic Planning Process
- Review and approve in respect of each fiscal year, strategic, business and capital plans for the Company including any joint ventures and monitor the Company’s human, technology and capital resources, the constraints on implementing such plans and management’s execution of such plans
- The Board believes that management is responsible for the development of long-term corporate strategy, while the role of the Board is to review, question and validate, and ultimately to approve the strategies proposed by management. Each year, the Board and ELT meet regarding the strategic planning for the Company in which future trends, analysis of competitors, opportunities and risks over a three to five year horizon are jointly identified and consider a strategic plan which addresses such trends, opportunities and risks.
- Review at every meeting recent developments that may impact the Company’s growth strategy and provide input to management on emerging trends, issues, strategic plans, objectives and goals that management develops.
- Identification and Management of Principal Risks
- Review with the ELT the principal risks of the Company’s business and monitor the implementation by management of appropriate systems to manage such risks. The Board may delegate one or more Committees of the Board to receive management’s assessment and responses and make recommendations and reports to the Board (ex. environmental, safety, treasury issues).
- Succession Planning, Appointment, Training and Monitoring Executive Leadership Team
- Approve the appointment of the Chair and CEO and the other officers of the Company. In reviewing and appointing ELT members, the Board will satisfy itself that candidates possess the necessary levels of integrity, skill and experience. The independent members of the Board are responsible for approving the compensation of the Chairman and CEO.
- Oversee that succession planning programs are in place, including programs to train and develop Executive Leadership Team members.
- The Board has delegated to the Human Resources Committee the review of succession plans for the ELT and delegated to the ELT the review of succession plans for the Company’s various operating groups.
- There should also be available, on a continuing basis, the Chairman and CEO’s recommendation for a successor in the event of an unexpected disability.
- External Communications
- Ensure that the Company maintains a program to effectively communicate with its stakeholders, including shareholders, employees and the general public.
- Review, approve and amend as required, on the recommendation of the Nominating & Corporate Governance Committee, the Corporate Disclosure Policy to address communications with shareholders, employees, financial analysts, governments and regulatory authorities, the media and the communities in which the business of the Company is conducted.
- Take steps to enhance the timely disclosure of any developments that have a significant and material impact on the Company.
- Report annually to shareholders on its stewardship for the preceding year through the annual report and proxy circular
- Integrity of Internal Control and Management Information Systems
- Ensure that effective systems are in place to monitor the integrity of the Corporation’s internal control and management information systems. The Board may delegate to the audit committee responsibility to review the effectiveness of the systems to monitor the Corporation’s internal control and management information systems.
- Approach to Corporate Governance Guidelines
- Review and approve corporate governance guidelines applicable to the Company and in accordance with statutory and regulatory requirements on the recommendation of the Nominating & Corporate Governance Committee. These Guidelines are more fully described in the Company’s Corporate Governance Guidelines.
- Examples include but are not limited to the size and composition of the Board, the compensation of directors, the assessment of the performance of the Board, its committees and Directors and approval of appropriate policies and procedures
Policies and Procedures
- Ensure that clear policies are in place relating to the conduct of the directors, officers and all employees and to ensure compliance with all applicable standards, laws and regulations.
- Adopt procedures to ensure reporting through management of any significant or material breaches of these policies and of improper or questionable conduct.
Matters reserved for the Board
An effective Board controls the business but delegates day to day responsibility to management. That said, there are a number of matters which are required to be or, in the interests of the Corporation, should only be decided by the board of directors as a whole. Matters reserved for the Board are detailed in the company’s Corporate Governance Guidelines.
The Board shall review annually the adequacy of this Charter and make changes as it deems advisable.
Approved by the Nominating & Corporate Governance Committee: August 2, 2005
Adopted by the Board: October 25, 2005
