The Equifax Inc. Board of Directors serves shareholder interests in the management and growth of a successful business, including optimizing long-term financial returns. The Board is responsible for directing the Company in such a way to ensure this result. This is an active, not a passive, responsibility. The Board has the responsibility to ensure that in good times, as well as difficult ones, management is capably executing its responsibilities. The Board's responsibility is to regularly monitor the effectiveness of management policies and decisions including the execution of its strategies.
In addition to fulfilling its obligations for increased shareholder value, the Board has responsibility to Equifax's customers, employees, and suppliers and to the communities where it operates--all of whom are essential to a profitable business. All of these responsibilities, however, are founded upon the successful perpetuation of the business.
Selection and Composition of the Board
1. Board Membership Criteria
The Governance Committee is responsible for developing and recommending to the Board criteria for selection of qualified directors, including criteria for the evaluation of nominees submitted by the shareholders. More specifically, the criteria to be considered shall include: the highest degree of integrity and ethical standards; independence from management; the ability to provide sound and informed judgment; a history of achievement that reflects superior standards; a willingness to commit sufficient time; possess financial literacy; and other public board memberships should not exceed five at the time a candidate is considered for election.
The Governance Committee will review with the Board, on an annual basis, the appropriate skills and characteristics required of Board members in the context of the current circumstances of the Board at that point in time. This assessment should include consideration of those factors deemed relevant by the Governance Committee and the Board such as issues of geographic, gender, age and ethic diversity, educational and professional experience, skills (such as understanding of accounting, finance, markets, technologies, international operations, corporate governance, industry knowledge and other disciplines relevant to the success of a large publicly traded company in today's business environment) and other board commitments. An individual director's background should be complementary to the Company's needs.
Each director should have the capacity and desire to represent the balanced, best interests of the Company and the shareholders as a whole and not primarily a special interest group or constituent.
Each director should be free of any conflict or interest that would violate any applicable law or regulation or interfere with the proper performance of his or her responsibilities as a director.
2. Selection and Orientation of New Directors
Subject to the requirements of applicable law, the Governance Committee is responsible for recommending to the Board a slate of directors for submission to shareholders at the Company's annual meeting, and is also responsible for considering and making recommendations to the Board concerning any nominees for director submitted by the shareholders in accordance with the nomination procedures in the Bylaws and any other policies or procedures adopted by the Governance Committee or the Board in connection with shareholder nominations. Attached as Appendices A, B and C, respectively, are the Company's provisions for the annual election of directors; majority voting for directors in uncontested elections; and director resignation policy.
Subject the the requirements of applicable law, the Board shall be responsible for selecting director nominees and recommending them for election by the shareholders. Shareholders may submit nominees for consideration as set forth in the latest proxy statement and in accordance with Rule 14a-11 under the Securities Exchange Act of 1934, as amended. The Board delegates the screening process involved to the Governance Committee with direct input from the Chairman of the Board and the Chief Executive Officer.
The Governance Committee oversees the director orientation and continuing education activities of the Board. The Board and the Company have an orientation process for new directors that includes background materials and meetings with senior management. Continuing education opportunities for directors will be identified and directors are encouraged to participate in appropriate continuing education activities.
3. Extending the Invitation to a Potential Director to Join the Board
The invitation to join the Board should be extended by the Board itself through the Chair of the Governance Committee and the Chairman of the Board.
4. Selection of Chairman of the Board and CEO
The Board should be free to make this choice in the best interests of the Company.
Therefore, the Board does not have a policy, one way or the other, on whether or not the role of the Chief Executive Officer and Chairman of the Board should be separate and, if it is to be separate, whether the Chairman of the Board should be selected from among non employee directors.
5. Presiding Director
If the Chairman of the Board is the Chief Executive Officer of the Company, then one of the non-employee directors will be named as Presiding Director. In addition to presiding at executive sessions of the non-employee directors described in Section 15 below, the Presiding Director powers or duties shall include:
advising the Chairman of the Board and Chief Executive Officer of decisions reached, and suggestions made, at executive sessions;
calling meetings of the non-employee directors;
presiding at each Board meeting at which the Chairman is not present;
reviewing and approving the agenda, sehedule and materials;
facilitating communication between the non-employee directors and the Chairman and Chief Execuitve Officer;
meeting directly with management and non-management employees of the Company; and
if requested by major shareholders, being available for consultation and direct communication.
The Presiding Director will be elected annually by majority vote of the non-employee directors after consultation with the Governance Committee. The Presiding Director shall have no greater obligations (fiduciary or otherwise) or liabilities than those of other directors by reason of serving as Presiding Director.
For purposes of these Guidelines, "non-employee directors" shall mean only those directors who (1) are not current employees of the Company, or (2) have not been employees of the Company at any time within the past five years.
Board Composition and Performance
6. Size of the Board
The Board believes that the number of directors should not exceed a number that can function efficiently as a body. The Company's Articles of Incorporation and Bylaws provide that the number of directors shall range from nine to twenty, and shall be fixed from within such range by the Board.
7. Inside and Outside Directors
On matters of corporate governance, the Board intends that decisions will be made by non-employee directors.
8. Access to Independent Advisors
In the course of fulfilling its duties, the Board shall have the authority to access Company resources, seek advice and assistance from outside consultants, legal counsel or other independent advisors as the Board, in its sole discretion, determines to be necessary or appropriate in carrying out its duties.
It is the policy of the Board that a substantial majority of its members will be independent directors. For a director to be considered independent, the Board must determine that the director does not have any direct or indirect material relationship with the Company. Independent directors shall meet the independence requirements of the New York Stock Exchange listing requirements (NYSE rules) and such other independence standards applicable to independent Board members as may be in effect from time to time under applicable laws, rules or regulations.
The Board has established guidelines (attached as Appendix D hereto) to assist it in determining director independence, which conform to or are more exacting than the independence requirements of the current NYSE rules. In addition to applying these guidelines, the Board will consider all relevant facts and circumstances in making an independence determination, and not merely from the standpoint of the director, but also from that of persons or organizations with which the director has an affiliation.
The Governance Committee and Board will monitor and review director independence, and the Board will make and publicly disclose its independence determination for each director when the director is first elected to the Board and annually thereafter for all nominees for election as director. If the Board determines that a director who satisfies the NYSE rules is independent even though he or she does not satisfy all of the Company's independence guidelines, this determination will be disclosed and explained in the next proxy statement. Each director shall notify the Board of any change in circumstances that may put his or her independence at issue. If so notified, the Board will reevaluate, as promptly as practicable thereafter, such director's independence.
Members of the Audit Committee and the Compensation, Human Resources & Management Succession Committee shall additionally meet the independence criteria applicable to them under Rules 10A-3, Rule 10C-1 and Rule 14a-11 of the Securities Exchange Act of 1934. It is also the sense of the Board that each member of the Compensation, Human Resources & Management Succession Committee should meet the criteria for being a 'non-employee director' under Rule 16b-3 of the Securities Exchange Act of 1934 and be an 'outside director' within the meaning of Section 162(m) of the Internal Revenue Code.
10. Former Chief Executive Officer's Board Membership
The Board believes this is a matter to be decided on individual circumstances. It is assumed that when the Chief Executive Officer resigns from that position, he or she should submit his/her resignation from the Board at the same time. Whether the individual continues to serve on the Board is a matter for determination by the Board.
11. Directors Who Change Their Present Job Responsibility
The Board believes that individual directors who significantly change the responsibility they held when they were elected to the Board should submit a letter of resignation to the Board.
It is not the sense of the Board that the directors who retire, or change the position they held when they came on the Board, should leave the Board in every instance. There should, however, be an opportunity for the Board, through the Governance Committee, to review continued Board membership under these circumstances.
12. Term Limits
While term limits may help ensure that there are fresh ideas and viewpoints available to the Board, they hold the disadvantage of losing the contribution of directors who have been able to develop, over a period of time, increasing insight into the Company and its operations and, therefore, provide an increasing contribution to the Board as a whole. Accordingly, the Board has not established term limits for director service.
As an alternative to term limits, the Governance Committee, in conjunction with the Chief Executive Officer and the Chairman of the Board, will formally review each director's contribution to the Board annually. This will also allow each director the opportunity to conveniently confirm his/her desire to continue as a member of the Board.
The Board believes that the current retirement age of 72 (age 65 for employee-directors) is appropriate, as stipulated in Section 2.5 of the Bylaws. A director reaching normal retirement age, or a director who changes his/her employer or otherwise has a significant change in job responsibilities or other business or professional relationship, shall submit his/her resignation.
At the request of the Governance Committee, and if ratified by the Board, a director may continue to serve after the normal retirement age or after a change of employer or job responsibilities or other relationships, if he/she continues in a position or in business or professional activities, or possesses special qualifications, that the Governance Committee and Board determine would be of substantial benefit to the Company.
14. Board Compensation Review; Director Stock Ownership Guidelines
The Governance Committee will annually review the status of Board compensation in relation to comparable U.S. public companies based on such benchmarking data as they deem appropriate, and make recommendations to the Board for approval of any changes in Board compensation. To create a direct linkage with corporate performance, the Board believes that equity in the Company should constitute a meaningful portion of a director's overall compensation. Directors are expected to own Company stock, the value of which is at least five times the annual Board cash retainer, by the fifth anniversary of the date the director was first elected to the Board.
Changes in Board compensation, if any, will be made by approval by the Board, based upon the recommendation of the Governance Committee.
15. Executive Sessions of Outside Directors
The non-employee directors of the Board will meet without management present at each regularly scheduled meeting of the Board and such meetings will be convened and chaired by the Presiding Director. If one or more non-employee directors are not also independent directors, the independent directors shall meet in executive session at least annually in addition to any meetings of the non-employee directors. The format of these meetings will include, in part, a discussion with the Chief Executive Officer on each occasion.
16. Assessing the Board's Performance
The Governance Committee is responsible to report annually to the Board an assessment of the Board's performance. This should be done following the end of each fiscal year and at the same time as the report on Board membership criteria. This assessment should be of the Board's contribution as a whole and specifically review areas in which the Board and/or the management contribution may be improved. Its purpose is to increase the overall effectiveness of the Board and its Committees.
17. Board's Interaction with Investors, Press, Customers, etc.
The Chairman of the Board and Chief Executive Officer is responsible for establishing effective communications with the Company's stakeholder groups, i.e., shareholders, customers, Company associates, communities, suppliers, creditors, governments, and corporate partners. It is the policy of the Board that management generally speaks for the Company. This policy does not preclue non-employee directors, including the Presiding Director and Committee Chairs, from meeting or otherwise communicating with the Company's shareholders and other stakeholder groups as appropriate. Where comments from the Board are appropriate, they will normally come from the Chairman of the Board.
The Board believes that it is important for directors to make themselves available to the Company's stakeholders by attendance at each Annual Meeting of Shareholders.
Shareholders interested in communicating directly with Board members may do so by writing to them in care of the Corporate Secretary, Equifax Inc., 1550 Peachtree Street, N.W., Atlanta, Georgia 30309. Correspondence will be forwarded as directed by the shareholder. The Company may first review such communications and screen out solicitations for goods and services and similar inappropriate communications unrelated to the Company or its business. All concerns related to audit or accounting matters will be referred to the Audit Committee.
Board Relationship to Management
18. Regular Attendance of Non Directors at Board Meetings
With the advice and consent of the Chairman of the Board and the Chief Executive Officer, the Board welcomes attendance at Board meetings of non Board members who are members of management.
19. Board Access to Management
Board members have complete access to Company management and employees.
Board members will ensure, in their judgment, that contact is not distracting to the business operations of the Company.
Furthermore, the Board encourages management to, from time to time, bring managers into Board meetings who: (a) can provide additional insight into the items being discussed because of personal involvement in these areas, and/or (b) represent managers with future potential that the senior management believes should be given exposure to the Board.
20. Board Meetings - Scheduling and Attendance
The Chairman of the Board is responsible for scheduling meetings of the Board. Meetings may be scheduled as in-person or telephone meetings. The Board and Committees may also act by unanimous written consent. Directors are responsible for attendance, either in-person or telephonically, at all meetings of the Board and Committees on which they serve.
21. Selection of Agenda Items for Meetings
The Chairman of the Board and the Chief Executive Officer (if the Chairman is not the Chief Executive Officer) will establish the agenda for each Board meeting. The Presiding Director will review and approve the Board agenda. Each Board member may suggest the inclusion of item(s) on the agenda.
22. Board Materials Distributed in Advance
It is the sense of the Board that information and data that is important to the Board's understanding of the business be distributed in writing to the Board before the Board meets. As a general rule, presentations on specific subjects should be sent to the Board members in advance so that Board meeting time may be conserved and discussion time focused on questions that the Board has about the material.
23. Number, Structure and Independence of Committees
The Governance Committee has the responsibility to recommend to the Board which Board Committees to form, and the composition and responsibilities of such Committees. The current Committees are Audit; Executive; Compensation, Human Resources & Management Succession; Governance; and Technology. Committee membership, with the exception of the Executive and Technology Committees, must consist solely of independent, non-employee directors.
24. Assignment and Rotation of Committee Members
The Governance Committee is responsible, after consultation with the Chairman of the Board and the Chief Executive Officer, and with consideration of the skills and desires of individual Board members, for recommending to the Board the assignment of Board members to various Committees.
It is the sense of the Board that consideration should be given to rotating Committee members and Committee chairs periodically at five-year intervals, but the Board does not mandate a policy of such rotation since there may be reasons to maintain an individual director's committee membership or committee chair for a longer period.
25. Frequency and Length of Committee Meetings
Committee Chair, in consultation with Committee members, will determine the frequency, and the length, of Committee meetings.
26. Committee Agendas
Committee Chair, in consultation with Committee members and management, will develop and approve their respective Committee agendas.
27. Annual Evaluation of the Chief Executive Officer
The independent members of the Board are responsible for evaluating the performance of the Chief Executive Officer on an annual basis. This evaluation should be based on: (a) objective criteria including the Chief Executive Officer's performance against his or her annual objectives; (b) the performance of the business; and (c) other factors the independent directors may deem appropriate and relevant. The Presiding Director will lead the evaluation process and communicate the results to the Chief Executive Officer. The evaluation will be used by the Compensation, Human Resources & Management Succession Committee in the course of its consideration of the compensation of the Chief Executive Officer.
28. Succession Planning
The Chair of the Compensation, Human Resources & Management Succession Committee will report annually to the independent members of the Board on succession planning. There shall also be available to the Presiding Director, on a continuing basis, the Chief Executive Officer's recommendation as to a successor should he/she be unexpectedly rendered unable to perform the duties of such office, along with a review of any development plans recommended for such individual.
29. Management Development
The Chief Executive Officer will report annually to the Board concerning the Company's program for management development. This report should be given to the Board at the same time as the succession planning report noted above.
30. Code of Ethics and Compliance Programs; Confidentiality
The Board expects all directors, officers and employees to act with the highest standards of integrity and adhere to the Company's policies and applicable code of conduct, ethics and compliance program. Directors also are required to act at all times in accordance with the requirements of the Company's Code of Conduct and Ethics for Directors and compliance program, including its insider trading policy. The Audit Committee of the Board annually reviews and oversees compliance with the Company's ethics and compliance programs.
The proceedings and deliberations of the Board and its committees shall be confidential. Each director shall maintain the confidentiality of information received in connection with his or her service as a director.
31. Reliance on Management and Outside Advice
In performing its functions, the Board shall be entitled to rely on the advice, reports and opinions of management, counsel, accountants, auditors and other expert advisors. Except as otherwise provided in the charter of a Committee, the Board shall have the authority to select, retain, terminate and approve the fees and other retention terms of its outside advisors.
As revised September 11, 2012