Corporate Governance Overview
The Board of Directors has formally adopted the EDS Corporate Governance Guidelines which set forth many of the established corporate governance practices and policies under which the Board has operated since its inception as well as additional policies adopted as a result of the Sarbanes-Oxley Act (“Act”) and the governance rules of the New York Stock Exchange (“NYSE”). The Guidelines include the Board's recently adopted Shareholder Meeting Attendance policy that each director should attend each annual shareholders meeting in its entirety and in person.
The Board's Governance Committee has formally adopted standards and processes for Director Nominations which detail how the Governance Committee identifies, evaluates and recommends candidates for membership on EDS Board of Directors and how eligible shareholders can submit recommendations to the Governance Committee.
All of the non-management members of the EDS Board of Directors, including all members of the Audit, Governance, and Compensation and Benefits Committees, have been determined by the Board to be independent under the Board's policies regarding Director Independence.
All of the non-management members of the EDS Board of Directors and all members of the Audit, Governance, and Compensation and Benefits committees who will remain in office following the 2004 Annual Meeting have been determined by the Board to be independent under the Board's policies regarding Director Independence.
As required by the Act and related SEC rules, the Audit Committee has adopted procedures and guidelines concerning the receipt, retention and treatment of accounting, internal accounting controls, and auditing matters. These procedures are intended to complement the procedures set forth in EDS' Financial Integrity Policy for the confidential, anonymous submission by Company employees of concerns regarding questionable accounting or auditing matters. Non-employees may submit concerns regarding these matters as provided in the policy for Director Communications.
EDS' Corporate Governance Guidelines require our non-management directors to meet in executive session without management present from time to time and at least twice per year. The executive sessions are chaired on a rotating basis by the Chairpersons of the Board's three standing Committees. Individuals may communicate with this Presiding Director or the non-management directors as a group as outlined in the Board's policy regarding Director Communications.
EDS has a long established and recently updated Code of Business Conduct available to employees in multiple languages on the company intranet. Every year, employees are required to acknowledge awareness of the code, that they have access to it, have read it and understood it, and are aware of how to seek guidance or report violations. The EDS Code of Business Conduct, which complies with SEC and NYSE rules, is applicable to all employees of EDS and its family of companies, including the Chief Executive Officer, the Chief Financial Officer, and other senior executives and officers, as well as the Board of Directors.
In addition to requirements contained in EDS' Corporate Governance Guidelines requiring pre-approval of contributions by EDS to not-for-profit organizations with which directors are associated, the EDS Foundation has adopted a policy prohibiting any such contributions by that foundation.
EDS currently posts its SEC filings on its Web site, including all filings regarding transactions by officers and directors in EDS equity securities required by SEC rules.