As reflected in our
Vision and
Guiding Principles, Kimball is committed to the highest standards of
ethical conduct
(view ethics policy) in its business dealings. Kimball
believes that our Company, through its Board of Directors, Executive
Management, and Employees, reflect these Guiding Principles in the structure of
the governance of our Company. We are aligned, engaged, and operating in an
environment of mutual trust and respect. While ethics cannot be legislated or
mandated, they are the foundation of the Corporate Governance Principles which
follow:
A. General Authority
The Board is elected by the stockholders to protect their interests through
counsel and direction to the management of the Company with a long term view
toward the Company's success and prosperity.
B. Delegation
The Board has delegated certain functions to committees of the Board, and
primarily delegates the Chief Executive Officer, working in conjunction with
all the other officers and employees of the Company, the authority and
responsibility for the day-to-day management of the business of the Company
consistent with our
Guiding Principles. Major matters affecting the Company require Board
of Director approval, and in some instances, approval of the shareholders.
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A. Separate Roles of the Chairman of the Board and Chief Executive Officer
The Chairman of the Board and Chief Executive Officer have separate functions.
The Chairman is responsible for the leadership of the Board of Directors and
presides at all its meetings. The Chief Executive Officer is responsible for
the day-to-day management of the Company's business.
B. Size of Board
The Company's Articles of Incorporation require that the Board consist of
between 7 and 15 members, the exact number being set by the Board of Directors
as authorized under the By-laws.
C. Director Independence
The exercise of independent judgment by the directors is critical to effective
corporate governance. The majority of the directors on the Company's Board are
classified as "Independent" in accordance with our stock exchange (NASDAQ)
listing requirements, as well as an evaluation of the Board of any
circumstances which may affect a director's ability to exercise independent
judgment.
D. Board Membership Criteria
The rapidly changing business conditions and markets, in which the Company
operates, require a high-performance and committed Board. Expectations of our
Board members include:
-
Personal integrity.
-
Commitment to the Company's
Vision, and
Guiding Principles.
-
Practical judgment.
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Broad and complementary experience and expertise in various areas such as
finance and accounting, education, government, etc., such that the members can
bring a diverse set of skills and backgrounds to bear on the complicated issues
which come before it.
-
Prepare for, attend and participate in all Board and applicable committee
meetings.
-
Commitment to serve over a period of time sufficient to understand the
Company's history, markets, and business operations.
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Willingness to think independently and present reasoned points of view.
E. Shareholder Board Member Recommendations
The Governance and Nominating Committee will consider candidates recommended by
shareholders. A shareholder who wishes to recommend a director candidate for
consideration by the Governance and Nominating Committee should send such
recommendation to the Secretary of the Company at 1600 Royal Street, Jasper, IN
47549, who will forward it to the Committee. Any such recommendation should
include a description of the candidate's qualifications for Board service; the
candidate's written consent to be considered for nomination and to serve if
nominated and elected, and addresses and telephone numbers for contacting the
shareholder and the candidate for more information. A shareholder who wishes to
nominate an individual as a director candidate at the annual meeting of
shareholders, rather than recommend the individual to the Governance and
Nominating Committee as a nominee, must comply with the advance notice
requirements mandated by the Company's By-laws and further explained in the
"Share Owner Proposals" section of its Proxy Statement.
F. Conflicts of Interest
A relationship by a Board member, or a member of his or her family, with a
customer, supplier, or other relationship which may impair a director's ability
to exercise independent judgment is prohibited.
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A. Scheduling Meetings
Board meetings are scheduled in advance. There are four
regularly-scheduled meetings per year. The Board can also meet at other
times or act by unanimous written consent, as appropriate in the circumstances.
B. Agenda
The Chairman, in common consultation with the Chief Executive Officer and
Secretary, drafts the agenda of each meeting and distributes it in advance for
input by the Board. There is an annual cycle of agenda items which include
regular operational reviews and finance reports by the Chief Financial Officer
and/or operating unit executives.
C. Attendance
It is expected that directors attend all Board meetings, as well as the annual
meeting of shareholders.
D. Preparation
Relevant materials are sent in advance of the Board meeting for review and
adequate preparation by Board members.
E. Board Access to Management
The Board has complete and open access to any member of the Company's
management. Senior Executive Management is often present at Board meetings
which allows access directly to the Board members.
F. Access to Independent Advisors
The Board of Directors and its Committees have the authority to the extent
necessary to carry out their duties, the right to retain legal, financial, or
other advisors.
G. Executive Sessions of Independent Directors
Independent Board members have the opportunity to meet without management
present at least twice annually at regularly scheduled meetings.
H. Board Communications with Shareholders
Shareholders may communicate with Board members by sending comments in care of
the Company's Corporate Secretary at 1600 Royal Street, Jasper, IN 47549. The
Corporate Secretary has the discretion to forward the correspondence to the
director, or if circumstances dictate, to other departments within the Company
to which such communication is more appropriately addressed. A log of
correspondence received and copies are available to any director who wishes to
review it.
I. Annual Board Self-Evaluation
The Board will conduct an annual review of its operation and its members with a
focus on determining the effectiveness of the Board in operating as a coherent
and effective governing body.
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Committees are established by the Board from time-to-time to assist in the
execution of the Board's responsibilities. There are standing committees, as
well as the opportunity if necessary to appoint ad hoc committees for a
specified purpose. There are currently no ad hoc committees of the Board, and
there exist two standing committees:
-
Audit Committee
-
Compensation and Governance Committee
These committees meet on a less frequent basis than the Board, normally at
least once per year, but sometimes more. Each committee carries out its
responsibilities in accordance with the authority delegated in its Charter from
the Board of Directors. Each committee has the authority to engage outside
advisors and reports its findings and recommendations for action.
A brief description for each of the standing committees is as follows:
Audit Committee - The primary function of the Audit Committee is to provide
independent, objective oversight of the Company's accounting functions,
internal controls, and financial reporting. Its primary duties and
responsibilities are to monitor and oversee the accounting functions, internal
controls, serve as an independent and objective party to review and appraise
the audit efforts of the Company's outside auditor and internal audit group,
and provide an open avenue of communication among the outside auditor,
financial and senior management, the internal audit group and the Board of
Directors.
Audit Committee Members
Geoffrey L. Stringer (Chairperson)
Thomas J. Tischhauser
(view
charter)
Compensation and Governance Committee – The Committee's primary functions are to
assist the Board of Directors discharge of its obligations relating to the
grant of stock compensation, the fair and competitive compensation of the Chief
and other Executive Officers of the Company, identification of individuals
qualified to be Board members, Board committee nominations, corporate
governance practices, Board member evaluations, orientation, and succession
planning.
Compensation and Governance Committee Members
Jack R. Wentworth
Geoffrey L. Stringer
Christine M. Vujovich (Chairperson)
(view
charter)
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The Board has adopted stock ownership guidelines requiring the holding of
certain levels of equity interest in the Company by not only executives, but
directors as well. Guidelines require that each director ultimately have an
equity interest in the Company of a value of at least three times his or her
total Board compensation.
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