Human Capital Committee Charter
I. Purpose of Committee
The Human Capital Committee (the “Committee”) is a committee of the American Cancer Society, Inc. Board of Directors (the “Board”). The purpose of the Committee is to (1) oversee the Corporation’s compensation philosophy and its employee compensation and benefits programs; (2) manage the performance evaluation process for the Corporation’s Chief Executive Officer (the “CEO” ), and make recommendations to the Board regarding the CEO’s compensation, benefits, and incentive programs; (3) review and make determinations regarding the compensation, benefits, and incentive programs for other officers and executives who are determined to be “Disqualified Persons” as defined in Section 4958 of the Internal Revenue Code; (4) review succession planning for the CEO, the Disqualified Persons, and other key positions or functions as determined by the Committee or the CEO; and (5) assist the Board with oversight of the Corporation’s culture and strategies related to human capital management.
The provisions of this charter shall apply to the American Cancer Society, Inc. and the American Cancer Society Cancer Action Network and any future affiliate of the Corporation in which the Corporation has a controlling interest, which shall be referred to collectively throughout this document as the Corporation.
II. Committee Membership
The Committee shall have at least three (3) members at all times. All members of the Committee shall be members of the Board and shall meet independence standards in accordance with the Corporation’s Bylaws. Members of the Committee and the Committee Chair are appointed by the Board and may be subject to removal by the Board in accordance with the Corporation’s Bylaws. The Committee may elect a Vice Chair from among its members to have such authority and responsibility as the Committee shall determine.
III. Committee Authority and Responsibilities
The Committee shall have the authority and responsibilities set forth below.
A. Compensation Philosophy and Compensation and Benefit Programs
1. Determine whether the Corporation’s compensation structure and benefit programs are appropriate compared to market and make recommendations, as needed, to the Board regarding significant changes in the Corporation’s overall compensation structure and benefit programs.
2. Annually review and approve the Corporation’s Compensation Philosophy to ensure the Corporation’s practices with respect to compensation and benefits are consistent, fair, transparent, and aligned with the Corporation’s mission and core values.
3. Monitor and approve in advance any payouts to Disqualified Persons or other executives, as required by the Corporation’s Compensation Philosophy.
B. CEO and Other Disqualified Persons Performance and Compensation
1. Determine whether there shall be an annual incentive plan or long-term incentive plan and approve the design of any such plans as well as plan eligibility for the CEO, the other Disqualified Persons, or other executives as required by the Corporation’s Compensation Philosophy.
2. Review and recommend Board approval of annual goals for the CEO, as established under any incentive plans, or otherwise.
3. Manage the CEO’s annual performance evaluation on behalf of the Board by reviewing the CEO’s performance, including assessing performance against approved goals, and making recommendations to the Board for the CEO’s base salary, benefits, performance thresholds, targets or maximums under any incentive plan, incentive plan payments, or other compensation actions based on (i) any approved incentive plan(s), (ii) evaluation of performance, and (iii) comparable market data, ensuring the reasonableness and appropriateness of the CEO’s compensation and benefits in relation to the marketplace.
4. On an annual basis review and approve a list of Disqualified Persons, in accordance with Internal Revenue Code Section 4958, as amended.
5. Review and approve the terms of employment and total compensation for Disqualified Persons, as follows:
i. Review and approve base salary; eligibility for incentive plan participation; performance thresholds, targets or maximums under any incentive plan; goals established under any incentive plan; performance against approved goals and related incentive plan payments; and the terms of any employment agreements, severance, and/or retention agreements.
ii. To assist the Committee in fulfilling its duties, the CEO shall comply with such requirements as may be specified in the Compensation Philosophy and provide the Committee with an annual evaluation of the performance of each of the Disqualified Persons and make recommendations to the Committee regarding any salary adjustments, payouts under any incentive plans, or other payments or benefits. These recommendations must include comparable market data, ensuring the reasonableness and appropriateness of compensation and benefits in relation to the marketplace.
C. Succession Planning
1. Annually review succession plans for the CEO position and submit plans to the Board for approval, as needed.
2. Annually review succession plans for the other Disqualified Persons and other key positions and functions as identified by the Committee or the CEO, as needed.
D. Human Capital Management
1. Review the results of employee engagement surveys and similar data and information.
2. Review the Corporation’s key human capital management strategies and programs, including those related to culture; diversity, equity, and inclusion; and workforce demographics.
E. Other Authority and Responsibilities
1. Retain such outside counsel, experts, or other advisors, including compensation consultants, as the Committee may deem advisable in its sole discretion to provide advice or other support to the Committee. The Committee shall have sole authority to approve related fees and retention terms.
2. Oversee enterprise risk management related to executive compensation and benefits and report any risks to the Audit and Risk Committee as appropriate.
3. Have such other authority and responsibilities as may be provided in the Corporation’s Bylaws and applicable law, or as may otherwise be delegated to the Committee by the Board.
IV. Committee Meetings
The Committee will meet at least annually and as often as it deems necessary or appropriate in accordance with this charter and the Bylaws.
If Committee meetings include external experts, the Committee will ensure that only independent directors and Committee members participate in any Committee voting.
As necessary, the Committee will meet in a joint session with other committees regarding items of concern to both committees.
V. Committee Minutes
The Committee will keep minutes of its meetings and shall report its actions to the Board at the next meeting of the Board.
VI. Committee Evaluation
As directed by the Governance and Nominating Committee, at least every two years, the Committee will conduct a performance evaluation to review the performance of the Committee in relation to the requirements of this Charter and shall report the results of such review to the Board.
