This is “Nominating Committees”, section 1.5 (from appendix 1) from the book Governing Corporations (v. 1.0). For details on it (including licensing), click here.

For more information on the source of this book, or why it is available for free, please see the project's home page. You can browse or download additional books there. To download a .zip file containing this book to use offline, simply click here.

Has this book helped you? Consider passing it on:
Help Creative Commons
Creative Commons supports free culture from music to education. Their licenses helped make this book available to you.
Help a Public School
DonorsChoose.org helps people like you help teachers fund their classroom projects, from art supplies to books to calculators.

12.5 Nominating Committees

New NYSE and SEC rules stipulate that

  • a listed company must have a nominating and corporate governance committee composed entirely of independent directors;
  • the nominating and corporate governance committee must have a charter that addresses the committee’s purpose and sets forth the goals and responsibilities of the committee.

Nominating new board members is one of the board’s most important functions. It is the responsibility of the nominating committee to nominate individuals to serve on the company’s board of directors. Placing this responsibility in the hands of an independent nominating committee increases the likelihood that chosen individuals will be more willing to act as advocates for the shareholders and other stakeholders and be less beholden to management.