Magna Adopts Further Corporate Governance Enhancements
AURORA, Ontario, January 25, 2012 /PRNewswire/ --
Builds Upon Prior Initiatives to Evolve its Corporate Governance Practices
Magna International Inc. (TSX: MG, NYSE: MGA) today announced that its Board has adopted a number of further corporate governance enhancements as part of the evolution of its corporate governance practices.
"The changes adopted today underscore that the Board continues to be responsive to, and is fully aligned with, shareholder interests," said Magna Chairman Michael Harris. "Since the completion of the plan of arrangement in August 2010, the Board has implemented a number of enhancements to its corporate governance practices while continuing to emphasize the key operating principles and Corporate Constitution that have been the cornerstone of Magna's historical success. During this same time, the Board has also approved several increases to Magna's dividend, bought back shares under a share buy-back program and overseen a number of acquisitions, while continuing to emphasize the strong financial discipline that has enabled Magna to have one of the strongest balance sheets in the industry. We believe that the Board's record demonstrates its continued commitment to building long-term shareholder value."
The shareholder-friendly enhancements adopted by the Board today include:
- Say on Pay: Commencing with Magna's 2012
annual meeting, shareholders
will vote on an advisory
resolution relating to the
company's approach to executive
compensation.
- Full Majority Voting: Magna's existing majority
voting policy has been amended
to clarify that a resignation
delivered by a director who
receives more "Withhold" votes
than "For" votes, will be
accepted unless there are
extraordinary circumstances
that would justify rejecting
the resignation. After
receiving the recommendation of
the Nominating Committee, the
independent directors of the
Board who secure a majority of
"For" votes will accept or
reject a resignation no more
than 90 days after the meeting
at which the director election
occurred. The decision made by
the independent directors will
be publicly disclosed by press
release and reasons will be
provided if a resignation under
the policy is rejected.
- Director Stock Options Eliminated: Compensation for Magna's
independent directors will not
include any new grants of stock
options. No stock options have
been granted to independent
directors since May 2010.
- Disclosure of Detailed Voting Results: While Magna previously
announced that disclosure will
be made of detailed voting
results relating to each
shareholder meeting beginning
with our 2012 annual meeting,
the Board approved a formal
policy confirming that Magna
will publicly disclose the
number and percentage of votes
cast on every matter at each
shareholders' meeting.
- Board Renewal: In connection with the ongoing
process of Board renewal,
Russell Reynolds Associates has
been engaged to assist in the
search for additional
independent directors who will
be nominated for election at
Magna's 2012 annual meeting.
The current search prioritizes
candidates with strong
financial, automotive, global
business and/or corporate
governance expertise. Through
the current search, the Board
seeks to build upon the process
of orderly board renewal
following the retirement from
the Board of three directors in
2010/2011 and the election of
two new independent directors
in May 2011. Additionally, for
2012, the independent directors
(collectively) will oversee the
director search and nominating
functions.
- Director Education: The Board adopted a formal
director education policy to
help ensure that Magna's
directors are provided with
ongoing education relating to
the company's business and
industry, as well as various
other topics such as corporate
governance, risk management and
executive compensation.
- Board Evaluation: In order to enhance the
effectiveness of the Board's
self-evaluation, recognized
corporate governance expert
Carol Hansell of Davies Ward
Phillips & Vineberg will
facilitate the evaluation
process of the Board and
directors in respect of 2011.
The enhancements described above are reflected in a revised Board Charter, which can be found on Magna's website under "Corporate Governance".
ABOUT MAGNA
We are the most diversified automotive supplier in the world. We design, develop and manufacture automotive systems, assemblies, modules and components, and engineer and assemble complete vehicles, primarily for sale to original equipment manufacturers of cars and light trucks. Our capabilities include the design, engineering, testing and manufacture of automotive interior systems; seating systems; closure systems; body and chassis systems; vision systems; electronic systems; exterior systems; powertrain systems; roof systems; hybrid and electric vehicles/systems; as well as complete vehicle engineering and assembly.
Magna has over 107,000 employees in 286 manufacturing operations and 88 product development, engineering and sales centres in 25 countries.
FORWARD LOOKING STATEMENTS
This release may contain statements which constitute "forward-looking statements" under applicable securities legislation and are subject to, and expressly qualified by, the cautionary disclaimers that are set out in Magna's regulatory filings. Please refer to Magna's most current management's discussion and analysis of results of operations and financial position, annual information form and annual report on form 40-f, as replaced or updated by any of Magna's subsequent regulatory filings, which set out the cautionary disclaimers, including the risk factors that could cause actual events to differ materially from those indicated by such forward-looking statements. These documents are available for review on Magna's website at http://www.magna.com.
For further information: Vince Galifi, Executive Vice-President and Chief Financial Officer at +1-905-726-7100
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