Governance and Reporting Awards in 2008
We received several awards and recognitions for governance practices and corporate reporting in 2008:
- Board Chair Dallas J. Howe received a 2009 Fellowship Award Honoring Excellence in Corporate Governance from the Institute of Corporate Directors.
- PotashCorp tied for first place in The Globe & Mail's annual Board Games rating of governance practices for Canadian companies.
- The Canadian Coalition for Good Governance gave the company the 2008 Governance Gavel Award to honor the quality of director disclosure practices.
- IR magazine named ours the Best Annual Report in Canada.
- The Canadian Institute of Chartered Accountants honored PotashCorp with an Award of Excellence in the Mining Category for our 2007 Annual Report, the Award of Excellence in Electronic Disclosure and the Award of Excellence in Sustainability Reporting.
Sustainability Investor Indexes
In 2008, we became the first fertilizer manufacturer to be selected for the Dow Jones Sustainability Index for North America. The Dow Jones Sustainability Indexes are one of the most prestigious measures of publicly traded companies’ sustainability performance. The annual review of companies is based on analysis of corporate economic, environmental and social performance, assessing issues such as corporate governance, risk management, branding, climate change mitigation, supply chain standards and labor practices.
We are also on England’s FTSE4Good Index and Canada’s Jantzi Research Index.
Board Sustainability Initiatives and Activities in 2008/2009
The board formally reviews the company’s sustainability performance once each year.
2008/2009 board sustainability activities and initiatives also included:
- Demonstrating its responsiveness to shareholder sentiment by announcing in March 2009 that PotashCorp will introduce a non-binding advisory shareholder vote related to executive compensation (commonly referred to as “say-on-pay”) at the annual meeting in 2010. Listening to our stakeholders is one of our Core Values, and it is clear that executive compensation is an increasingly important issue.
- Comprehensively reviewing climate change initiatives.
- Reviewing 2008 SHE performance targets and performance.
- Discussing sustainability topics, including governance, ethics and philanthropy.
- Maintaining continuity of the board’s expertise in the domestic and international fertilizer industry by replacing retiring board member Fred Blesi with Steven Hoffman.
- Reinforcing our pay-for-performance philosophy, the compensation committee reviewed and adopted a new Medium-Term Incentive Plan for the three-year performance period ending December 31, 2011 and began using the DAXglobal Agribusiness Index as a benchmark.
- Approving a recoupment policy, on recommendation from the compensation committee, that enables the board to recover or cancel incentive compensation if the executive’s conduct results in the company having to restate its financial statements.
- Implementing a new double-trigger change of control provision in the 2009 Performance Option Plan as recommended by the compensation committee. The double-trigger consists of a change in control, such as new ownership of the company, and the failure of the new management in control to provide those holding options with equivalent options in the new company.
Board Composition
The 12 members of PotashCorp’s board are residents of Canada, the United States and the Dominican Republic. In 2008, three board members were women. All board members are picked for their expertise and experience in areas identified as a need for the board.
