Charter of the Management Development and Compensation Committee
The management development and compensation committee is a standing committee of the board of trustees of Puget Consumers Co-op, or PCC Community Markets. This charter specifies the scope of the responsibilities of this committee and the manner in which the committee is to perform those responsibilities.
The purpose of this committee is to discharge the responsibilities of the board relating to overseeing (1) PCC’s compensation philosophy, policies, plans and practices; (2) the compensation of members of the board and the executive officers of PCC; (3) the periodic review of the performance of PCC’s CEO relative to goals and objectives related to compensation; and (4) executive officer succession planning and PCC’s leadership development efforts.
PCC’s compensation policies with respect to the executive officers of PCC are based on principles designed to attract and retain qualified personnel through an overall level of compensation opportunity that is competitive within PCC’s industry and to encourage achievement of PCC’s goals by providing compensation programs that directly relate to the performance of the individual within the context of PCC’s values, operating principles, and strategic plans.
Committee Membership and Organization
Membership on the committee is to be determined by the board upon the recommendation of the governance and membership committee. The committee should be composed of three or more trustees, each of whom will serve until his or her successor is duly appointed by the board or his or her earlier resignation or removal. The board may remove a member of the committee at any time with or without cause and may appoint any non-employee trustee to fill any vacancy on the committee. Committee members shall have prior experience in management and oversight of compensation philosophies, compensation structures (including bonus plans) or benefit plan structure or performance (including health and wellness plans).
The board may designate a chairperson of the committee. If a chairperson has not been designated by the board, the members of the committee may designate a chairperson by majority vote of the full committee membership.
The committee may form and delegate authority to subcommittees when appropriate or to one or more members of the committee.
The committee may obtain advice or assistance from consultants, legal counsel, accounting or other advisors as appropriate to perform its duties and responsibilities. The fees and costs of any consultant or advisor engaged by the committee to assist the committee in performing its duties and responsibilities must be approved by the board chair and are to be borne by PCC.
The committee is to meet as often as it determines necessary or advisable to discharge its duties and responsibilities. The committee may establish its own rules and procedures for notice and conduct of its meetings so long as they are not inconsistent with the provisions of PCC’s bylaws applicable to committees of the board.
The committee may invite any person whose presence the committee believes to be desirable and appropriate to attend and observe meetings of the committee. Individuals who are invited to attend meetings of the committee may not participate in any discussion or deliberation of the committee unless invited to do so by the committee chairperson and may not vote on any matter brought before the committee.
The committee should maintain minutes or other records of its meetings and activities. The committee is to make regular reports to the board concerning the meetings and activities of the committee.
Committee Authority and Responsibilities
The committee has the following authority and responsibilities, subject to any modification or additional authority as the board may approve from time to time:
- The committee is to periodically review and advise the board concerning PCC’s overall compensation philosophy, policies, plans and practices, including a review of both regional and industry compensation practices and trends.
- The committee is to approve any modification of material importance to financial terms in PCC’s labor contracts prior to PCC’s “last and final” offer. Modifications of “material importance” to financial terms shall mean an increase of greater than 10% in any material financial provision of the labor contracts over the prior contracts.
- The committee is to approve the introduction of new employee benefit plans of material financial importance to PCC, and material modifications to the financial terms of existing employee benefit and pension plans, other than as prescribed by PCC’s labor contracts or changes in applicable laws.
- The committee is to review and recommend to the board corporate and individual performance goals and objectives relevant to the compensation of the CEO, consider the evaluation of the performance of the CEO in light of those goals and objectives, and recommend to the board the CEO’s compensation (including salary, bonus, incentive compensation, benefits and perquisites) based on this evaluation.
- The committee is to review and approve corporate and individual performance goals and objectives relevant to the compensation of senior management (as defined in the Delegation of Authority adopted by the board), and set all senior management compensation (including salary, bonus, incentive compensation and perquisites). The committee should consult with, and take into account the recommendations of, the CEO with respect to any matters concerning the performance and compensation of senior management. The committee should, from time to time as needed, make recommendations to the board regarding which employees are to be considered “senior management”.
- The committee is to review and make recommendations to the board with respect to the terms of any employment or severance agreement to be executed by PCC other than in the ordinary course of business with any member of senior management.
- The committee is to coordinate the succession planning of PCC’s senior management and provide reports to the board. The committee is to support leadership development programs for PCC’s leadership team.
- The committee is to review and make recommendations to the board with respect to the compensation of members of the board.
- The committee is to conduct a periodic review and evaluation of the scope of its responsibilities and its performance of its duties. The committee should report to the board the results of this performance evaluation and recommend any changes to this charter to the board.