Corporate Responsibility Overview
The commitment of Colliers International Group Inc. ("Colliers" or the "Company") to acting in a responsible manner stems from our firm belief that good governance is good business. It is the integrity of our dealings with our partners that has been the foundation for the success of Colliers and in that spirit, we continue to review and evaluate the Company's business operations and practices so that we may continue to make decisions that are beneficial to our clients, shareholders and employees.
The board of directors (the "Board") of the Company considers good corporate governance practices to be an important factor in the overall success of the Company. Under National Instrument 58-101 - Disclosure of Corporate Governance Practices and National Policy 58-201 - Corporate Governance Guidelines Practices (collectively, the "Corporate Governance Rules"), the Company is required to disclose information relating to its corporate governance practices. The Company is committed to adopting and adhering to corporate governance practices that either meet or exceed applicable corporate governance standards. The Company believes that its corporate governance practices should be compared to the highest standards currently in force and applicable to it as well as to best market practices.
In addition, the Company believes that director, officer and employee honesty and integrity are important factors in ensuring good corporate governance, which in turn improves corporate performance and benefits all shareholders. To that end, the Board has adopted a Code of Ethics and Conduct, which code applies to all directors, officers and employees of the Company and its subsidiaries, and a Financial Management Code of Ethics and Conduct, which code applies to senior management and senior financial and accounting personnel of the Company and its subsidiaries. Any deviations from the Code of Ethics and Conduct are required to be reported to an employee's supervisor and, if appropriate, the Chief Financial Officer of the Company and the Board. Any deviations from the Financial Management Code of Ethics and Conduct are required to be reported to internal audit staff, the Chief Executive Officer (the "CEO"), and the Chair of the Audit Committee of the Board.
The Board currently is comprised of seven members. A majority of the Board is comprised of independent directors. Mr. Hennick is not an independent director within the meaning of the Corporate Governance Rules because he is a member of management of the Company. In deciding whether a particular director is or is not an independent director, the Board examined the factual circumstances of each director and considered them in the context of many factors. The Board has adopted a majority voting policy for the election of directors.
The Board has a written mandate ("Mandate") which provides that the Board is responsible for the stewardship of the Company, which requires the Board to oversee the conduct of the business and affairs of the Company and supervise management. The Board Mandate provides that each member of the Board must act honestly and in good faith with a view to the best interests of the Company, and must exercise the care, diligence and skill that a reasonably prudent person would exercise in comparable circumstances. The Board mandate further provides that all members of the Board shall have suitable experience and skills given the nature of the Company and its businesses, have a proven record of sound judgment and possess characteristics and traits that: (i) reflect high ethical standards and integrity in their personal and professional dealings; (ii) the ability to provide thoughtful and experienced counsel on a broad range of issues; (iii) the ability to monitor and evaluate the financial performance of the Company; (iv) an appreciation of the value of Board and team performance over individual performance and a respect for others; and (v) an openness for the opinions of others and the willingness to listen, as well as the ability to communicate effectively and to raise tough questions in a manner that encourages open and frank discussion.
The Board adopted a policy relating to a director's tenure and priorities. Under this policy, upon a director reaching the age of 75, and on each anniversary thereafter for so long as such individual continues to serve as a director, such director must tender his or her written resignation from the Board to the Nominating & Corporate Governance Committee (the "Governance Committee"). The Governance Committee will, within 30 days, consider the resignation offer and will recommend to the Board whether or not to accept it. The Board will thereafter act on the Governance Committee's recommendation within 30 days. If a resignation is accepted, it will be effective either: (i) prior to the commencement of the next annual meeting of Collier's shareholders at which directors are to be elected; or (ii) upon acceptance of such offer of resignation by the Board, as determined by the Board. In addition, this policy provides that upon initially becoming a director of Colliers, and at each annual Board meeting occurring immediately prior to the annual meeting of Colliers's shareholders at which directors are to be elected, each director will represent to the Board that membership on the Board and the carrying out of such director's Board and committee duties is one of such director's "top three" priorities and that such director's personal or professional circumstances do not adversely affect such director's ability to effectively serve as a director of Colliers.
Mr. Hennick, who is not an independent director, has been appointed Chairman of the Board and Mr. Cohen, an independent director, has been appointed as Vice Chairman of the Board and has been given the responsibilities of a "lead director", thereby ensuring appropriate independence among the roles of Chairman and Chief Executive Officer (who is Mr. Hennick) and Vice Chairman (who is Mr. Cohen).
As Chairman, Mr. Hennick provides leadership to directors in discharging their mandate, including by leading, managing and organizing the Board consistent with the approach to corporate governance adopted by the Board from time to time, promoting cohesiveness among the directors and being satisfied that the responsibilities of the Board and its committees are well understood by the directors. The Chairman is responsible for taking all reasonable measures to ensure that the Board fully executes its responsibilities. The Board has a adopted a formal position description for the Chairman, which provides, among other things, that the Chairman will: (i) ensure that all business required to come before the Board is brought before the Board such that the Board is able to carry out all of its duties to manage or supervise the management of the business and affairs of the Company; (ii) ensure the Board has the opportunity, at each regularly scheduled meeting, to meet separately without non-independent directors and management personnel present; and (iii) in conjunction with the relevant committee of the Board (and its Chair), review and assess the directors' meeting attendance records and the effectiveness and performance of the Board, its committees (and their Chairs) and individual directors.
As Vice Chairman, Mr. Cohen facilitates the functioning of the Board independently of management and provides independent leadership to the Board. The Board has a adopted a formal position description for the Vice Chairman, which provides that the Vice Chairman will have, among other things, the following responsibilities: (i) provide leadership to ensure that the Board functions independently of management and other non-independent directors; (ii) in the absence of the Chairman, act as chair of meetings of the Board; (iii) review with the Chairman and Chief Executive Officer items of importance for consideration by the Board; (iv) as may be required from time to time, consult and meet with any or all of the independent directors, at the discretion of either party and with or without the attendance of the Chairman, and represent such directors in discussions with management on corporate governance issues and other matters; (v) promote best practices and high standards of corporate governance; and (vi) assist in the process of conducting director evaluations.
Board and Committee Process
In addition to having a Board comprised of a majority of independent directors, Colliers has adopted a variety of structures to allow for the independence of the Board from management. Those structures include the appointment of Mr. Cohen, an independent director, as Vice Chairman with "lead director" responsibilities with a mandate to assist the Board in fulfilling its duties independent of management, the practice of having the independent members of the Board or its committees meet as a group (with no members of management present) regularly at Board and committee meetings, and members of the Board and its committees having the opportunity to initiate discussions with senior management without the CEO present so that they may freely discuss any concerns they may have, and the ongoing monitoring of the relationship between the Board and its committees and management by the Governance Committee, which is composed entirely of independent directors. The Board believes that it and its committees have functioned, and continue to function, independently of management.
The Company's CEO reports formally to the Board, and, where appropriate, to its committees, as well as less formally through discussions with members of the Board and its committees, to advise the Board and its committees on a timely basis of courses of action that are being considered by management and are being followed. The Board exercises its responsibility for oversight through the approval of all significant decisions and initiatives affecting the Company. The Board has developed a formal position description for the CEO. The position description for the CEO provides that the CEO has the primary responsibility for the management of the business and affairs of the Company. As such, the CEO establishes the strategic and operational orientation of the Company and, in so doing, provides leadership and vision for the effective overall management, profitability, increase in shareholder value and growth of the Company and for conformity with policies agreed upon by the Board. The CEO is directly accountable to the Board for all activities of the Company.
Management, working with the Board and the Governance Committee, provides an orientation program for new directors and a continuing education program for all directors to familiarize and update them with respect to the Company and its businesses. Prior to agreeing to join the Board, new directors are given a clear indication of the workload and time commitment required. The Chairman ensures the orientation program is carried out as directed by the Governance Committee. New directors to the Company have generally been executives with extensive business experience. Orientation for these individuals is provided through a review of past Board materials and other private and public documents concerning the Company and visits to certain of the Company's businesses and offices. On a continuing basis, management provides periodic presentations for the Board to ensure that directors are aware of Company operations, major business trends and industry practices, and directors are free to contact the CEO, the Chief Financial Officer and other members of management at any time to discuss any aspect of the Company's businesses.
The Board, either directly or through Board committees, is responsible for overseeing the business and affairs of the Company and for approving the overall direction of the Company, in a manner which is in the best interests of the Company and its shareholders. At least four regular meetings of the Board are scheduled each year at which the directors review in detail the financial statements, operating reports, forecasts, budgets and reports from the committees of the Board and from management. The frequency of meetings as well as the nature of agenda items changes depending upon the state of the Company's affairs and in light of opportunities or issues that the Company may face.
The Board has three standing committees: the Audit & Risk Committee, the Executive Compensation Committee and the Governance Committee. The roles of these committees are outlined on the Board Mandates and Codes of Ethics page. Each committee has a written mandate establishing the responsibilities of the committee, and each committee reviews and assesses its mandate at least annually and has the authority to retain special legal, accounting or other advisors. From time to time ad hoc committees of the Board may be appointed. As the Board has plenary power, any responsibility which is not delegated to management or a Board committee remains with the Board.