Investor Relations

Charles River provides essential products and services to help pharmaceutical and biotechnology companies, government agencies and leading academic institutions around the globe accelerate their research and drug development efforts. Our dedicated employees are focused on providing clients with exactly what they need to improve and expedite the discovery, early-stage development and safe manufacture of new therapies for the patients who need them.

Committee

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Committee Members
Committee MemberJames C. Foster
Committee MemberGeorge M. Milne, Jr., Ph.D.
Committee MemberGeorge E. Massaro
Committee MemberC. Richard Reese
Committee MemberRobert J. Bertolini
ChairpersonGeorge E. Massaro
Committee MemberStephen D. Chubb
Committee MemberRobert J. Bertolini
Committee MemberJean-Paul Mangeolle
ChairpersonC. Richard Reese
Committee MemberDeborah T. Kochevar, D.V.M., Ph.D., D.A.C.V.C.P.
Committee MemberRichard F. Wallman
Committee MemberJean-Paul Mangeolle
Committee MemberDeborah T. Kochevar, D.V.M., Ph.D., D.A.C.V.C.P.
ChairpersonGeorge M. Milne, Jr., Ph.D.
Committee MemberMartin Mackay, Ph.D.
ChairpersonRobert J. Bertolini
Committee MemberJames C. Foster
Committee MemberC. Richard Reese
Committee MemberRichard F. Wallman
Committee MemberStephen D. Chubb
Committee MemberDeborah T. Kochevar, D.V.M., Ph.D., D.A.C.V.C.P.
Committee MemberGeorge M. Milne, Jr., Ph.D.
Committee MemberMartin Mackay, Ph.D.
ChairpersonRichard F. Wallman
Committee MemberGeorge M. Milne, Jr., Ph.D.

Audit Committee Charter
As of October 2018
Compensation Committee Charter
As of January 2013
Corporate Governance and Nominating Committee Charter
As of August 2006

Charles River Laboratories International, Inc.
Charles River Laboratories, Inc.

Audit Committee Charter

Amended October 2018

Audit Committee Charter Quicklinks
INTRODUCTION
PURPOSE
MISSION STATEMENT
GENERAL GUIDELINES
RESPONSIBILITIES
PROCEDURES
LIMITATIONS
AMENDMENT

INTRODUCTION

Executive management of Charles River Laboratories International, Inc. and Charles River Laboratories, Inc. (together, the “Corporation”) is responsible for the completeness and accuracy of its financial reporting and the adequacy of its internal financial and operating controls. Its Board of Directors has responsibility to oversee management’s discharge of these responsibilities. To assist the Board, the Corporation has established, through its Bylaws, an Audit Committee whose authority and responsibilities are described by this Charter.

PURPOSE

This Charter is created in order to define the Audit Committee's objectives, the range of its authority, the scope of its activities and its duties and responsibilities. It is intended to give Audit Committee members, management, external and internal auditors a clear understanding of their respective roles. The Audit Committee and the Board of Directors will review and assess the adequacy of this Charter periodically but at least annually.

MISSION STATEMENT

The Audit Committee is created by the Board of Directors of the Company to:

  • assist the Board in its oversight of
    • the integrity of the financial statements of the Company;
    • the qualifications, independence and performance of the Company's independent auditor;
    • the performance of the Company's internal audit function; and
    • compliance by the Company with legal and regulatory requirements with respect to financial reporting matters; and
  • prepare the Audit Committee report that Securities and Exchange Commission rules require to be included in the Company's annual proxy statement.


GENERAL GUIDELINES

Size, Composition and Term of Appointment

The Audit Committee is a committee of the Board of Directors and will consist of no fewer than three directors, each of whom will meet the independence and experience requirements of the New York Stock Exchange ("NYSE") and at least one of whom will have accounting or related financial management expertise to qualify as a "financial expert" as defined by the relevant rules promulgated by the NYSE, Financial Accounting Standards Board ("FASB"), Securities and Exchange Commission ("SEC"), National Association of Securities Dealers ("NASD") or other regulatory bodies. The Corporate Governance and Nominating Committee will recommend nominees for appointment to the Audit Committee annually and as vacancies or newly created positions occur. Audit Committee members will be appointed by the Board and may be removed by the Board at any time. The Corporate Governance and Nominating Committee will recommend to the Board, and the Board will designate, the Chair of the Audit Committee.

Meetings

The Audit Committee will meet as often as it determines is appropriate to carry out its responsibilities under this charter, but not less frequently than quarterly. The Chair of the Audit Committee, in consultation with the other committee members, will determine the frequency and length of the committee meetings and will set meeting agendas consistent with this charter.

Oversight by the Board of Directors

  1. 1. The Committee will report its activities to the full Board on a regular basis so that the Board is kept informed of its activities on a current basis. This report will include a review of any issues that arise with respect to the quality or integrity of the Company’s financial statements, the Company’s compliance with legal and regulatory requirements with respect to financial reporting matters, the qualifications, independence and performance of the Company’s independent auditor, the performance of the internal audit function, and any other matters that the Audit Committee deems appropriate or is requested to be included by the Board. The Committee will perform all duties determined by the Board.
  2. The Board will determine annually that the Committee's members are independent and that the Committee has fulfilled its duties and responsibilities.

Authority

The Committee derives its authority from the By-Laws of the Corporation and is hereby given all resources and authority necessary to properly discharge its duties and responsibilities. The Committee acts on the Board's behalf in matters outlined below.


RESPONSIBILITIES

In addition to any other responsibilities which may be assigned from time to time by the Board, the Audit Committee is responsible for the following matters:

Independent Auditor

  1. The Committee, as representatives of the shareholders, has the ultimate authority to select, evaluate and, where appropriate, replace the independent auditor to be proposed for shareholder approval in the proxy statement. The Committee will consider management's recommendation of the appointment of the independent auditor. The Committee will review with management the performance, appointment and/or termination of the independent public accountants.
  2. The Committee will evaluate the independent auditors’ qualifications, performance and independence and will present its conclusions and recommendations to the full Board on at least an annual basis. As part of such annual evaluation, the Committee will:
  3. The Committee will evaluate the independent auditors' qualifications, performance and independence and will present its conclusions and recommendations to the full Board on at least an annual basis. As part of such annual evaluation, the Committee will:
    • obtain and review a report(s) from the Company's independent auditors:
      • describing the independent auditors' internal quality-control procedures;
      • describing any material issues raised by (i) the most recent internal quality-control review or peer review of the auditing firm, or (ii) any inquiry or investigation by governmental or professional authorities within the preceding five years, regarding one or more independent audits carried out by the auditing firm; and any steps taken to deal with any such issues;
      • describing all relationships between the independent auditor and the Company; and
      • assuring that Section 10A of the Securities Exchange Act of 1934 has not been implicated;

    • review and evaluate the senior members of the independent auditor team(s), particularly the lead audit and reviewing partners;
    • consider whether the lead audit or reviewing partner should be rotated more frequently than is required by law, so as to assure continuing auditor independence;
    • consider whether the independent auditors should be rotated, so as to assure continuing auditor independence; and
    • obtain the opinion of management and the internal auditors of the independent auditor's performance.

  4. The Committee will review with management and the independent auditor the Company's compliance with laws and regulations having to do with accounting and financial matters.
  5. The Committee and the Board of Directors should consider whether the independent auditor should meet with the full Board to discuss any matters relative to the financial statements and/or any potentially relevant matters, and to answer any questions that other directors may have.
  6. The Committee will establish policies for the Company's hiring of current or former employees of the independent auditor.

Financial Statements, Disclosure and Other Risk Management and Compliance Matters

  1. The Committee will review with management, internal auditors and the independent auditor, as appropriate, and in separate meetings if the Committee deems it appropriate:
    • the annual audited financial statements, including the Company's disclosures under "Management's Discussion and Analysis of Financial Condition and Results of Operations", prior to the filing of the Company's Form 10-Ks;
    • the quarterly financial statements, including the Company's disclosures under "Management's Discussion and Analysis of Financial Condition and Results of Operations," prior to the filing of the Company's Form 10'Qs;
    • any analyses or other written communications prepared by management, the internal auditors and/or the independent auditor setting forth significant financial reporting issues and judgments made in connection with the preparation of the financial statements, including analyses of the effects of alternative methods consistent with generally accepted accounting principles (GAAP) on the financial statements;
    • the critical accounting policies and practices of the Company;
    • related-party transactions and off-balance sheet transactions and structures;
    • any major issues regarding accounting principles and financial statement presentations, including any significant changes in the Company's selection or application of accounting principles;
    • regulatory and accounting initiatives or actions applicable to the Company (including any SEC investigations or proceedings);
    • in conjunction with management, the Company's policies with respect to the Company's earnings press releases and all financial information, such as earnings guidance, provided to analysts and rating agencies, including the types of information to be disclosed and the types of presentation to be made and paying particular attention to the use of "pro forma" or "adjusted" non-GAAP information; and
    • the Company's policies and practices with respect to risk assessment and risk management, including discussing with management the Company's major financial risk exposures and the steps that have been taken to monitor and control such exposures.

  2. The Committee will request from financial management and the independent auditor, a briefing on any significant accounting and reporting issues, including any changes in accounting standards or rules promulgated by the FASB, SEC or other regulatory bodies, that have an effect on the financial statements.
  3. The Committee will inquire about the existence and substance of any significant accounting accruals, reserves, or estimates made by management that had a material impact on the financial statements.
  4. The Committee will, in conjunction with the Chief Executive Officer and Chief Financial Officer of the Company, review the Company’s internal controls and disclosure controls and procedures, including whether there are any significant deficiencies in the design or operation of such controls and procedures, material weaknesses in such controls and procedures, any corrective actions taken with regard to such deficiencies and weaknesses and any fraud involving management or other employees with a significant role in such controls and procedures.
  5. The Committee will review and discuss with the independent auditor any audit problems or difficulties and management’s response thereto, including those matters required to be discussed with the Audit Committee by the auditor pursuant to Public Company Accounting Oversight Board Statement on Auditing Standard No. 1301 (which has superseded Statement on Auditing Standards 61):
    • any restrictions on the scope of the independent auditor's activities or access to requested information;
    • any accounting adjustments that were noted or proposed by the auditor but were "passed" (as immaterial or otherwise);
    • any communications between the audit team and the audit firm's national office regarding auditing or accounting issues presented by the engagement;
    • any management or internal control letter issued, or proposed to be issued, by the auditor; and
    • any significant disagreements between the Company's management and the independent auditor.

  6. The Committee will establish procedures for:
    • the receipt, retention and treatment of complaints received by the Company regarding accounting, internal accounting controls or auditing matters, and
    • the confidential, anonymous submission by employees of the Company of concerns regarding questionable accounting or auditing matters.

  7. The Committee will review any significant complaints regarding accounting, internal accounting controls or auditing matters received pursuant to such procedures.
  8. The Committee will prepare the audit committee report that the SEC rules require to be included in the Company's annual proxy statement.

Private Discussions with Independent Auditor

The Committee will meet privately with the independent auditor to request their opinion on various matters including the quality of the Company's accounting principles as applied in its financial reporting, and the quality and performance of its financial and accounting personnel and the internal audit staff, if any.

Areas Requiring Special Attention

The Committee will instruct the independent auditor and Internal Audit, if any, that the Committee expects to be advised if there are any areas that require special attention.

Post-Audit Review

The Committee will review with management and the independent auditor the annual Management Letter comments and management's responses to each.

Litigation

The Committee will discuss/review with management, company counsel, and the independent auditor the substance of any significant issues raised by counsel concerning litigation, contingencies, claims or assessments. The Committee should understand how such matters are reflected in the Company's financial statements.

Internal Audit

  1. The Committee will ensure that the internal audit function is structured in a manner that achieves organizational independence, including full and unrestricted access to senior management, the Audit Committee and the Board of Directors.
  2. The Committee will review and approve the internal audit function's charter to ensure unrestricted access to records, personnel and physical properties relevant to perform engagements.
  3. At least annually, the Audit Committee will evaluate the performance, responsibilities, budget and staffing of the Company's internal audit function and review the internal audit plans and budgets to determine that the internal audit objectives and goals, staffing plans, appropriateness of resources, financial budgets and audit schedules provide adequate support of the Company's and Committee's goals and objectives. Such evaluation will include a review of the responsibilities, budget and staffing of the Company's internal audit function with the independent auditor.
  4. At least annually, the Committee will evaluate the performance of the senior employees responsible for the internal audit function of the Company, and make recommendations to the Board and management regarding the responsibilities, retention or termination of such employees. Decisions regarding the hiring or termination of the head of Internal Audit will require the endorsement of the Audit Committee chair.
  5. The Committee will regularly provide internal audit with the opportunity to confer privately with the Committee, without the presence of management.
  6. The Committee will ascertain that recommendations to management by internal audit have been adequately considered and, if accepted, properly implemented.

Reporting to the Board

  1. At least annually, the Committee will evaluate its own performance and report to the Corporate Governance and Nominating Committee on such evaluation.
  2. The Committee will periodically review and assess the adequacy of this charter and recommend any proposed changes to the Corporate Governance and Nominating Committee.
  3. The Committee will provide input to the Compensation Committee as to the compensation of the Corporation’s Chief Financial Officer.

PROCEDURES

The Committee will meet separately, periodically, with management, with internal auditors or other personnel responsible for the internal audit function and with the independent auditor.

The Committee is authorized (without seeking Board approval), and will have available from the Corporation appropriate funding,to retain special legal, accounting or other advisors and may request any officer or employee of the Company or the Company’s outside counsel or independent auditor to meet with any members of, or advisors to, the Audit Committee.

The Committee may delegate its authority to subcommittees or the Chair of the Audit Committee when it deems appropriate and in the best interests of the Company.

LIMITATIONS INHERENT IN THE AUDIT COMMITTEE'S ROLE

It is not the duty of the Audit Committee to plan or conduct audits or to determine that the Company's financial statements are complete and accurate and are in accordance with GAAP. This is the responsibility of management and the independent auditor. Furthermore, while the Audit Committee is responsible for reviewing the Company's policies and practices with respect to risk assessment and management, it is the responsibility of the CEO and senior management to determine the appropriate level of the Company's exposure to risk.

AMENDMENT

This charter may be amended by a majority of the independent members of the Board of Directors.

Charles River Laboratories, Inc.
Charles River Laboratories International, Inc.

Compensation Committee Charter

Amended June 2013

Compensation Committee Charter Quicklinks
Purpose
Membership
Authority and Responsibilities
Procedures
Amendment

Purpose

The Compensation Committee is created by the Board of Directors of the Company to:

  • Oversee the Company’s compensation and benefits structure, policies and programs generally;
  • Review the Company’s processes and procedures for the consideration and determination of executive compensation;
  • Review executive officer performance evaluations and the Company’s management succession plan;
  • Oversee and set compensation for the Company’s executive officers; and
  • Prepare the report for inclusion in the Company’s proxy statement relating to its annual meeting of stockholders or annual report on Form 10-K, in accordance with applicable rules and regulations.

The primary objective of the Compensation Committee is to develop and implement compensation policies and plans that are appropriate for the Company in light of all relevant circumstances and which provide incentives that further the Company’s long-term strategic plan and are consistent with the culture of the Company and the overall goal of enhancing stockholder value.

For the purposes of this Charter, the term “officer or “executive officer” means any officer who is a member of the Management Executive Committee and any other employee who is identified by the Compensation Committee by resolution.

Membership

The Compensation Committee shall consist of at least three members, comprised solely of independent directors meeting the independence requirements of Section 303A of the New York Stock Exchange Listed Company Manual. All members of the Compensation Committee shall also be “non-employee directors” as defined in Rule 16b-3 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and “outside directors” as defined in Section 162(m) of the Internal Revenue Code of 1986, as amended. The Corporate Governance and Nominating Committee shall recommend nominees for appointment to the Compensation Committee annually and as vacancies or newly created positions occur. Compensation Committee members shall be appointed by the Board and may be removed by the Board at any time, with or without cause. Resignation or removal of a Director from the Board, for whatever reason, shall automatically constitute resignation or removal, as applicable, from the Compensation Committee. The Corporate Governance and Nominating Committee shall recommend to the Board, and the Board shall designate, the Chairman of the Compensation Committee. The Chairman of the Board of the Company may attend meetings of the Compensation Committee as a nonvoting invitee.

Authority and Responsibilities

In addition to any other responsibilities which may be assigned from time to time by the Board, the Compensation Committee is responsible for the following matters.

Compensation Policies and Plans

  1. The Compensation Committee shall review and approve the Company’s compensation and benefits structure, policies and programs generally (subject, if applicable, to shareholder ratification), including reviewing and approving any incentive-compensation plans and equity-based plans of the Company. In reviewing such compensation and benefits structure, policies, and programs, the Compensation Committee may consider the recruitment, development, promotion, retention and compensation of executive officers and other employees of the Company and any other factors that it deems appropriate. The Compensation Committee shall review and discuss with management any description of such compensation and benefits structure, policies and programs to be included in the Company’s proxy statement.
  2. The Compensation Committee shall exercise all rights, authority and functions of the Board of Directors under all of the Company’s equity-based plans, including without limitation, the authority to interpret the terms thereof, to grant options thereunder and to make stock awards thereunder; provided, however, that except as otherwise expressly authorized to do so by a plan or resolution of the Board, the Committee shall not be authorized to amend any such plan. The Compensation Committee shall review and make such recommendations to the Board as the Compensation Committee deems advisable with regard to policies and procedures for the grant of equity-based awards by the Company.
  3. The Compensation Committee shall report the results of such review and any action it takes with respect to the Company’s compensation and benefits policies to the Board.
  4. The Compensation Committee may delegate to one or more officers of the Company the authority to make grants and awards to any non-Section 16 officer of the Company under such of the Company’s incentive-compensation or other equity-based plans as the Compensation Committee deems appropriate and in accordance with the terms of such plans.

CEO Compensation

  1. The Compensation Committee shall annually review and approve corporate goals and objectives relevant to the compensation of the Company’s Chief Executive Officer, evaluate the CEO’s performance in light of those goals and objectives, and determine and approve the CEO’s compensation level based on this evaluation. In determining the long-term incentive component of the CEO’s compensation, the Committee shall consider, among other factors, the Company’s performance and relative shareholder return, the value of similar incentive awards to chief executive officers at comparable companies, and the awards given to the CEO in the past years.
  2. In addition, the Compensation Committee shall review periodically the compensation being paid or potentially payable to the Company’s CEO through the use of tally sheets or such other method as the Compensation Committee may determine.

Executive Compensation

  1. The Compensation Committee shall review and approve for each of the Company’s executive officers the CEO’s recommendations for each officer’s (i) annual base salary level, (ii) annual incentive compensation, (iii) long-term incentive compensation, (iv) employment, severance and change-in-control agreements, if any, (v) any other material compensation plan, and (vi) ongoing perquisites or special benefit items.
  2. The Compensation Committee shall report the results of such review and any action it takes with respect to the compensation of the Company’s executive officers to the Board.
  3. In addition, the Compensation Committee shall review periodically the compensation being paid or potentially payable to the Company’s executive officers through the use of tally sheets or such other method as the Compensation Committee may determine.

Compensation Committee Report

  1. The Compensation Committee shall oversee the drafting of the Compensation Discussion and Analysis to be included in the Company’s proxy statement or annual report on Form 10-K (“CD&A”), and shall review and discuss with management the CD&A.
  2. Based on the Compensation Committee’s review and discussions with management of the CD&A, the Compensation Committee shall make a recommendation to the Board that the CD&A be included in the Company’s proxy statement or annual report on Form 10-K.
  3. The Compensation Committee shall prepare and sign the Compensation Committee Report to be included in the Company’s proxy statement or annual report on Form 10-K in accordance with the applicable rules and regulations of the Securities and Exchange Commission, any securities exchange on which the Company’s securities are traded, and any other rules and regulations applicable to the Company.

Reporting to the Board

  1. The Compensation Committee shall report to the Board regularly concerning areas of the Compensation Committee’s responsibility. This report shall include a review of any recommendations or issues that arise with respect to Company compensation and benefits structure, policies and programs, executive compensation, management succession planning and any other matters that the Compensation Committee deems appropriate or is requested to be included by the Board.
  2. At least annually, the Compensation Committee shall evaluate its own performance and report to the Corporate Governance and Nominating Committee on such evaluation.
  3. The Compensation Committee shall periodically review and assess the adequacy of this charter and recommend any proposed changes to the Board.

Procedures

  1. The Compensation Committee shall meet as often as it determines is appropriate to carry out its responsibilities under this charter but it is generally acknowledged that the Compensation Committee should meet no less than three times per year. The Chairman of the Compensation Committee, in consultation with the other committee members, shall determine the frequency and length of the committee meetings and shall set meeting agendas consistent with this charter. No executive officer should attend that portion of any meeting where such officer’s performance or compensation is discussed, unless specifically invited by the Compensation Committee.
  2. The Compensation Committee may delegate its authority to subcommittees or the Chairman of the Compensation Committee when it deems appropriate and in the best interests of the Company.
  3. The Compensation Committee has the sole authority and discretion to retain, oversee and terminate any compensation consultant, legal counsel or other advisor assisting the Compensation Committee in the performance of its duties and responsibilities (including in the evaluation of CEO or executive officer compensation), including sole authority to determine the nature and scope of their assignment, and the material elements of the instructions or directions to be given to such consultant or advisor, and sole authority to approve all such compensation consultant’s or advisor’s fees and other retention terms. The Compensation Committee is tasked with the duty and power to review the independence of the compensation consultants, legal counsel and advisors that it engages, and it may only engage such a compensation consultant, legal counsel or advisor, or receive advice from any compensation consultant, legal counsel or advisor, after taking into account the following factors:
    • The provision of other services to the Company by the employer of the consultant, counsel or advisor (the “Consultant’s Employer”);
    • The amount of fees received from the Company by the Consultant’s Employer, as a percentage of the total revenue of the Consultant’s Employer;
    • The policies and procedures of the Consultant’s Employer that are designed to prevent conflicts of interest;
    • Any business or personal relationship of the consultant, counsel or advisor with a member of the Compensation Committee;
    • Any Company stock owned by the advisor, counsel or consultant;
    • Any business or personal relationship of the adviser, counsel or consultant or the Consultant’s Employer with an executive officer of the Company; and
    • Any other factors the Compensation Committee determines to be relevant in determining whether such consultant, counsel or advisor is independent.

    At least annually, the Compensation Committee shall re-assess the independence of its compensation consultants, legal counsel or other advisors.

  4. In carrying out its responsibilities, the Compensation Committee shall be entitled to rely upon advice and information that it receives in its discussions and communications with management and such experts, advisors and professionals with whom the Compensation Committee may consult. The Compensation Committee shall have the authority to request that any officer or employee of the Company, the Company’s outside legal counsel, the Company’s independent auditor or any other professional retained by the Company to render advice to the Company attend a meeting of the Compensation Committee or meet with any members of or advisors to the Compensation Committee. The Compensation Committee shall also have the authority to engage legal, accounting or other advisors to provide it with advice and information in connection with carrying out its responsibilities and shall have sole authority to approve any such advisor’s reasonable fees and expenses and other retention terms. The Company will pay all such reasonable fees and expenses as directed by the Compensation Committee.

Amendment

This Charter may be amended by a majority of the independent members of the Board of Directors.

Charles River Laboratories, Inc.
Charles River Laboratories International, Inc.

Corporate Governance and Nominating Committee Charter

Amended August 2006

Corporate Governance and Nominating Committee Charter Quicklinks
INTRODUCTION
PURPOSE
MISSION STATEMENT
GENERAL GUIDELINES
RESPONSIBILITIES
CORPORATE GOVERNANCE MATTERS
AMENDMENT

INTRODUCTION

The Board of Directors of Charles River Laboratories International, Inc. consists of leaders in the industry meeting the qualifications required to serve on the Company’s Board. To assist the Company in all matters relating to the Board, the Company has established a Corporate Governance and Nominating Committee whose authority and responsibilities are described by this Charter.

PURPOSE

This Charter is created in order to define the objectives of the Corporate Governance and Nominating Committee, the range of its authority, the scope of its activities and its duties and responsibilities. It is intended to give the members of the Corporate Governance and Nominating Committee, management, and the Board of Directors a clear understanding of their respective roles. The Corporate Governance and Nominating Committee and the Board of Directors will review and assess the adequacy of this Charter periodically.

MISSION STATEMENT

  1. To evaluate and select qualified individuals as nominees for the Board of Directors of Charles River Laboratories International, Inc.
  2. To oversee and supervise the nominating process and ensure appropriate procedures are in place for the selection and presentation of qualified candidates.
  3. To advise the Board on all matters related to the Board and individual directors, including compensation of directors, and make recommendations to the Board regarding the duties of directors and other corporate governance matters.

GENERAL GUIDELINES

Size, Composition and Term of Appointment

The Corporate Governance and Nominating Committee is a committee of the Board of Directors and shall consist of no fewer than three directors, all of whom shall be independent directors meeting the independence requirements of the New York Stock Exchange. The independent members of the Board of Directors shall recommend nominees for appointment to the Committee annually and as vacancies or newly created positions occur. Committee members shall be appointed by the Board and may be removed by the Board at any time. The Committee shall recommend to the Board, and the Board shall appoint, the Chairperson of the Committee. The Chairman of the Board of the Company may attend meetings of the Corporate Governance and Nominating Committee as a nonvoting invitee.

Meetings

The Committee shall meet as often as it determines is appropriate to carry out its responsibilities under this charter but in no event fewer than two times a year. The Chair of the Committee, in consultation with the other Committee members, shall determine the frequency and length of the Committee meetings and shall set meeting agendas consistent with this charter.

Oversight by the Board of Directors

  1. The Committee will report either orally or in writing, its activities to the full Board on a regular basis so that the Board is kept informed of its activities on a current basis. This report shall include a review of any recommendations or issues that arise with respect to Board or committee nominees or membership, Board performance, corporate governance or any other matters that the Committee deems appropriate or is requested to be included by the Board.
  2. The Committee shall, at least annually, evaluate its own performance and report to the Board on such evaluation. The Committee will perform all duties determined by the Board.
  3. The Board will determine annually that the Committee’s members are independent. The Board also periodically will review and assess the adequacy of the Committee’s Charter.

Authority

The Committee derives its authority from the By-Laws of the Company and is hereby given all resources and authority necessary to properly discharge its duties and responsibilities. The Committee has the sole authority to retain and terminate any search firm assisting the Committee in identifying director candidates, including sole authority to approve all such search firm’s fees and other retention terms. In addition, the Committee has the sole authority to retain and terminate any compensation consultant assisting the Committee in the evaluation of director compensation, including sole authority to approve all such compensation consultant’s fees and other retention terms. The Committee acts on the Board’s behalf in matters outlined below. The Committee may delegate its authority to subcommittees or to the Chair of the Committee when it deems appropriate and in the best interest of the Company.

RESPONSIBILITIES

In addition to any other responsibilities which may be assigned from time to time by the Board, the Committee is responsible for the following matters:

Board and Committee Nominees

  1. The Committee shall oversee searches for and identify qualified individuals for membership on the Company’s Board of Directors. The Committee has the ultimate authority to evaluate and select nominees for directors of the Company to be proposed for shareholder approval in the proxy statement. The Committee will consider director nominees, including those submitted by Board members, shareholders and by other sources for appointment to the Board of Directors.
  2. The Committee will adopt and approve appropriate qualifications for nominees and will ensure that the nominees have the qualifications required to serve on the Company’s Board. The Committee will recommend to the Board criteria for Board and Committee membership, including as to director independence.
  3. The Committee will recommend to the Board (a) nominees for election at the next annual or special meeting of shareholders at which directors are to be elected or (b) nominees to fill any vacancies or newly created directorships that may occur between such meetings.
  4. The Committee will recommend directors for appointment to Board Committees.
  5. The Committee shall periodically review the composition of the Board and its committees in light of the current challenges and needs of the Board and each committee, and determine whether it may be appropriate to add or remove individuals after considering issues of judgment, diversity, age, skills, background and experience.

Director Compensation

The Committee shall review and approve compensation (including stock option grants and other equity-based compensation) for the Company’s directors. In so reviewing and approving director compensation, the Committee shall:

  1. evaluate the performance of the Board and set director compensation based on such evaluation and such other factors as the Committee deems appropriate and in the best interests of the Company (including the cost to the Company of such compensation and the director compensation practices of similar public companies);
  2. determine any long-term incentive component of director compensation based on the awards given to directors in past years, the Company’s performance, shareholder return and the value of similar incentive awards relative to such targets at comparable companies and such other factors as the Committee deems appropriate and in the best interests of the Company (including the cost to the Company of such compensation); and
  3. evaluate the possibility that directors’ independence may be compromised if director compensation exceeds customary levels, if the Company makes substantial charitable contributions to an organization with which a director is affiliated, or if the company enters into consulting contracts with (or provides other indirect forms of compensation to) a director or an organization with which a director is affiliated.

Director Orientation and Continuing Education

The Committee shall oversee the Company’s orientation program for new directors and the continuing education program for directors.

Procedures

As appropriate, the Committee shall:

  1. make recommendations to the Board regarding the number of meetings to be held by the Board of Directors, the performance of the Board and changes in the organization and procedures of the Board, including corporate governance.
  2. review the committee structure of the Board and make recommendations based on changes in organization, strategic direction and regulatory requirements.
  3. make recommendations to the Board on all matters relating to the Board, including the development of policies on composition, participation, the size of the Board, the tenure and retirement of directors, and training and orientation of new directors.

Evaluating the Board and its Committees

  1. The Committee shall, at least annually, lead the Board in a self-evaluation to determine whether it and its committees are functioning effectively. The Committee shall oversee the evaluation process and report on such process and the results of the evaluations, including any recommendations for proposed changes, to the Board.
  2. The Committee shall, at least annually, review the evaluations prepared by each Board committee of such committee’s performance and consider any recommendations for proposed changes to the Board.
  3. The Committee shall oversee the process for assessing individual director’s performance and recommend individual directors for re-election to the Board or any Board committee based on positive performance.

CORPORATE GOVERNANCE MATTERS

  1. The Committee is responsible for the development, and recommendation to the Board, of Corporate Governance Guidelines and a Code of Business Conduct and Ethics. The Committee shall review and reassess the adequacy of the Company’s Corporate Governance Guidelines and Code of Business Conduct and Ethics and recommend any proposed changes to the Board. The Committee shall be responsible for any tasks assigned to it in the Company’s Corporate Governance Guidelines and Code of Business Conduct and Ethics.
  2. The Committee shall oversee compliance with the Company’s Corporate Governance Guidelines and Code of Business Conduct and Ethics and report on such compliance to the Board. The Committee shall also review and consider any requests for waivers of the Company’s Corporate Governance Guidelines or Code of Business Conduct and Ethics for the Company’s directors, executive officers and other senior financial officers, and shall make a recommendation to the Board with respect to such request for a waiver.
  3. The Committee shall review potential conflicts of interest involving directors and shall determine whether such director(s) may vote on any issue as to which there may be a conflict
  4. The Committee shall consider any other factors that are set forth in the Company’s Corporate Governance Guidelines or are deemed appropriate by the Committee.

AMENDMENT

This Charter may be amended by a majority of the independent members of the Board of Directors.

 

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CRL (common)
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