Home: Investor Relations: Corporate Governance
Harsco Corporation believes that high standards of integrity are an essential foundation of the Company’s business conduct. To succeed, we must have public confidence and support. To continue to deserve such public trust, the conduct of Harsco and its employees must exceed the minimum. Every officer and employee of Harsco is expected to be guided by the values of integrity and honesty in every aspect of their duties.
The basic principles of Harsco’s ethical standards are documented in the Company’s Code of Conduct, which all employees are required to observe. The Code is issued in multiple languages to all Harsco employees throughout the world and supported by regular training programs. An online Intranet training program facilitates new employee orientations and individual refresher training.
The Harsco Internal Control Framework provides a common understanding of the internal control responsibilities of all Harsco employees. Harsco believes that an effective internal control system is a basic standard for both the operational and financial integrity of results, and is an integral component of a well-managed, quality operation. Harsco’s internal control system is built on a foundation of practices and procedures that promote fraud prevention, fraud detection, and timely and accurate financial reporting. The Internal Control Framework is distributed in multiple languages to all employees with management or administrative responsibilities.
The following principles govern the organization and activities of the Harsco Corporation Board of Directors.
The number of directors should be established with a view toward balancing the need for diversity of experience and talent against the risk of diluting responsibility and participation of members. A ten member Board is viewed as the optimal size for the Company with variations between eight and twelve being appropriate from time to time depending upon circumstances.
The Board will determine whether the offices of Chief Executive Officer and Chairman of the Board should be combined or separate, based on an analysis of then-existing facts and what is in the best interests of the Company at any particular time.
A Lead Director position shall be established when there is an executive Chairman of the Board. The Lead Director will be an independent director and will be selected annually by the independent directors in consultation with the Chairman of the Board. When there is a non-executive Chairman of the Board, such person shall serve in the capacity as the Lead Director in addition to the other responsibilities he may have as Chairman. The Lead Director shall be responsible for establishing the agenda for the sessions of the independent directors, chairing such sessions and communicating the result of such meetings to the Chairman and other members of management, as appropriate.
The Board will work together in seeking and nominating candidates for Board membership. The Board has delegated the screening process for new directors to the Nominating and Corporate Governance Committee in consultation with the Chairman of the Board. Consistent with its charter, the Nominating and Corporate Governance Committee is responsible for screening candidates, for establishing criteria for nominees and for recommending to the Board a slate of nominees for election to the Board of Directors at the Annual Meeting of Shareholders, and nominees for election by the Board to fill vacancies on the Board.
At least two-thirds of the Board should be “independent” directors as defined by the New York Stock Exchange and other applicable regulatory requirements. The Board shall undertake an annual review of the independence of all non-employee directors, which shall be administered by the Nominating and Corporate Governance Committee. At or prior to the meeting in which this review is to occur, the Nominating and Corporate Governance Committee shall provide the Board with sufficient information about each non-employee director’s business relationships with the Company and its management to enable it to evaluate the director’s independence.
The Nominating and Corporate Governance Committee works with the full Board to determine the appropriate characteristics, skills and experiences for the Board as a whole and its individual members. In evaluating the suitability of individual Board members, the Board takes into account many factors, including strength of character, mature judgment, business experience, availability, attendance, career specialization and relevant technical skills and such other characteristics as the Board may deem necessary in the make-up of the Board to adequately address the circumstances facing the Company.
It is the Board's policy that all directors shall retire from the Board no later than their 70th birthday. In addition, the Nominating and Corporate Governance Committee will make a serious evaluation of each director prior to any re-nomination regardless of age.
The discretion of the Nominating and Corporate Governance Committee and Board in carefully reviewing directors for re-nomination and the stockholders in reelecting directors provides appropriate protection against directors remaining on the Board despite declining performance. Therefore, the more arbitrary measure of director term limits is unnecessary.
The Board believes that its members should not be prohibited from serving on boards and/or committees of other organizations. However, the Nominating and Corporate Governance Committee will take into consideration the extent to which a director’s ability to adequately fulfill his or her responsibility to the Company and the Board may be impaired by service on other boards and committees. The Board shall also, as part of its annual review of the Chairman and/or Chief Executive Officer, look particularly at the impact any outside Board service may have on the performance of his responsibilities for the Company. No member of the Audit Committee should serve on the Audit Committee of more than three public companies, including the Corporation, without the approval of the Board.
When there is a change in a director's professional circumstances from those that pertained at the time of their election to the Board, the director will offer in writing to resign from the Board. A director who retires or changes position or responsibility after being elected to the Board will not necessarily be required to leave the Board. The Nominating and Corporate Governance Committee will review the continued appropriateness of Board membership and make recommendations for action by the Board.
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Presently, a schedule of seven regular Board Meetings annually is appropriate. The Chairman has the discretion to call additional meetings as required.
The Board will annually assess the performance of the Board as a group and implement any actions deemed necessary for improvement. The Nominating and Corporate Governance Committee shall oversee this process.
Directors shall have free access to management and management information. Members of management will make regular presentations at Board meetings in order to provide particular insights into various aspects of the Company’s business and to provide management with exposure to the Board for purposes of management development.
The Board and all Committees of the Board shall be entitled, at the expense of the Company, to engage such independent legal, financial and other advisors as they deem appropriate, without consulting or obtaining the approval of any officer of the Company, with respect to any matters subject to their respective authorities.
The Board believes that management speaks for the Company. Directors may, from time to time, be contacted by institutional investors, other shareholders, sellers of businesses or merger partners, government or community officials, analysts or the press to comment on or discuss the business of the Company. Directors are expected to refrain from communicating with any of the foregoing without prior consultation with the Chairman and/or Chief Executive Officer.
New Directors shall participate in an orientation program, which will be conducted as soon as possible after their election or appointment to the Board. The content of the orientation program will be determined by the Chairman in consultation with other senior management of the Company. As part of the Company’s continuing education program, Board members will participate in the Company’s unique mentoring program and will take advantage of such other opportunities as may be made available throughout their terms.
The primary responsibility of the Board is to oversee and provide direction and counsel to the senior management of the Company. Specifically, this includes, but is not limited to:
Directors will discharge the above responsibilities by exercising their business judgment in a manner that they believe in good faith is in the best interest of the Company and its shareholders.
The Chairman and the Chief Executive Officer have responsibility for formulating the agenda for Board Meetings, with input from other members of the Board. Directors will have access to all of the information that they believe is necessary or useful in fulfilling their duties. The Company’s mentoring program provides directors direct contact with the operating units and assists in conveying information to the Board.
Non-management directors will meet, without management present, on such occasions as they deem appropriate in connection with the regularly scheduled Board meetings. Specifically, non-management directors shall meet annually to review the performance of the Chief Executive Officer of the Company. The Board will designate two or more independent directors, including the Lead Director, to review the conclusions of the performance evaluation with the Chief Executive Officer.
The Chief Executive Officer and the Chief Financial Officer, the officers responsible for certifying the Company’s financial statements and SEC reports, will present financial performance reports to the Board at each Board Meeting. The Chief Executive Officer will report, or will arrange for other Company management to report to the Board at least annually on succession planning for the Chief Executive Officer and other key management positions, management development and training and the strategic direction of the Company and each of its divisions.
The Chairman and Secretary shall annually formulate and present to the Management Development and Compensation Committee for its consideration a recommendation on director compensation based upon industry surveys and other relevant information. The Committee will then make its recommendation to the Board. Directors will not be compensated for services to the Company beyond normal director fees. The Company will not pay fees for professional services (as distinguished from standard per diem director’s fees established by the Board for services rendered in the capacity as directors, e.g. mentoring) to a director or a director’s firm, including law firms, accounting firms, investment banks and the like.
While the Board encourages directors to be investors in the Corporation, the Board believes it is not appropriate to prescribe a minimum level of stock ownership. The Board believes that the quality of a director’s contribution is not directly correlated to his personal share ownership.
Currently there are four standing committees of the Board: Executive, Audit, Management Development and Compensation, and Nominating and Corporate Governance. The Board may establish other committees from time to time as circumstances dictate.
The Nominating and Corporate Governance Committee in consultation with the Chairman will propose Committee assignments and changes thereof from time to time for Board approval, with the aim of matching talents to perceived needs. The Board recognizes the value of director expertise that provides continuity and develops through longevity in Committee service, but also recognizes that periodic rotation may be appropriate to give directors broad exposure to Committee issues.
The members of the Audit, Management Development and Compensation, and Nominating and Corporate Governance Committee shall be composed of only members who qualify as "independent" directors and at all times meet any other requirements of applicable law and listing standards.
Each standing Committee shall have a written charter which shall be approved by the full Board and state the purpose of such Committee. Committee charters shall be reviewed on a regular basis to reflect the activities of each of the respective Committees, changes in applicable law or regulations, and other relevant considerations. Proposed revisions to the charter shall be approved by the full Board.
The calling of committee meetings and setting of agendas is within the prerogative of the Committee Chairman, with the assistance of the Board Secretary.
The Audit, Management Development and Compensation, and Nominating and Governance Committees will each conduct an annual performance evaluation of its Committee.
The Harsco Board of Directors support and encourage stockholders to contact the Board with questions and comments they may have by any of the following methods:
Writing the Chairman of the Board at the Corporate Headquarters (P.O. Box 8888, Camp Hill, PA 17001-8888).
Writing to any individual Board member in care of the Corporate Secretary (P.O. Box 8888, Camp Hill, PA 17001-8888). The Corporate Secretary will forward any such correspondence to the appropriate Board member.
E-mailing the Board at boardofdirectors@harsco.com
If appropriate, concerns relating to accounting, internal controls or auditing matters will be referred to the Audit Committee; compensation related matters will be referred to the Management Development and Compensation Committee; and inquiries relating to the director nominating process or the governance of the Company will be forwarded to the Nominating and Corporate Governance Committee. Other matters will be referred to the Board of Directors to determine the appropriate handling of the matter.
Your inquiries will be handled in confidence and you may contact the Board anonymously. Your contact will be acknowledged unless you choose to contact the Board anonymously.
Vice President - Investor Relations & Credit 717 975 5677 Phone etruett@harsco.com
