Nominating and Corporate Governance Committee Charter
Nu Skin Enterprises, Inc. Nominating and Corporate Governance Committee Charter
(Last Modified April 29, 2019)
The Nominating and Corporate Governance Committee (the "Committee") of the Board of Directors (the "Board") of Nu Skin Enterprises, Inc. ("NSE") is appointed by the Board to:
- Identify individuals qualified to become board members consistent with criteria approved by the Board;
- Recommend to the Board the director nominees to be presented for stockholder approval at the annual meetings of stockholders;
- Develop and recommend to the Board a set of corporate governance guidelines applicable to NSE;
- Recommend to the Board any proposed changes in Board member compensation and oversee the evaluation of the Board and management;
- Oversee NSE's risk assessment and risk management programs and plans for NSE’s corporate governance risks, operational risks not assigned to the Audit Committee, compliance and regulatory risks and reputational risks; and
- Oversee NSE’s regulatory, legal and compliance obligations in the foreign countries in which it operates, as well as individual compliance programs developed to address specific legal and regulatory issues in the United States and foreign countries.
II. STRUCTURE AND OPERATIONS
Composition and Qualifications
The Committee will be composed of three or more members of the Board, as determined by the Board from time to time; provided, however, that the Committee may operate with fewer than three members as long as such composition complies with applicable laws, rules, regulations, and securities exchange listing standards. Management directors are ineligible to serve as members of the Committee. Each member shall meet the applicable independence requirements of the New York Stock Exchange ("NYSE") and of the Securities Exchange Commission ("SEC") as they may be amended from time to time.
One member of the Committee should be an independent director who is either an attorney or a person with expertise in international regulatory enforcement or compliance.
Appointment and Removal
The Committee members will be appointed by the Board and may be removed, with or without cause, by a majority vote of the Board.
Delegation of Authority
The Committee shall have the authority to delegate any of its responsibilities to a subcommittee or subcommittees as the Committee may deem appropriate.
Unless a Committee Chair (the "Chair") is elected by the full Board, the members of the Committee shall designate the Chair by the majority vote of the full Committee membership. In the event of a tie on any issue, the Chair’s vote shall decide the issue.
The Committee shall meet as often as its members deem necessary to perform the Committee’s responsibilities. Any member of the Committee may call meetings of the Committee. All meetings of the Committee may be held by conference telephone or other communications equipment by means of which all persons participating in the meeting can hear each other. Participation in a meeting in this manner shall constitute presence in person at the meeting. Any action required or permitted to be taken at any meeting of the Committee may be taken without a meeting if all of the Committee members consent to the action in writing or by electronic transmission. The writing or writings or electronic transmission or transmissions shall be filed with the minutes of the proceedings of the Committee. All other conduct of Committee meetings shall be governed as provided in the Bylaws of NSE, as amended from time to time. The Committee shall maintain minutes or other records of meetings and activities of the Committee.
All non-management directors that are not members of the Committee may attend meetings of the Committee. Additionally, the Committee may invite to its meetings any other persons it deems appropriate in order to carry out its responsibilities including management personnel and other directors. The Committee may also meet in executive session, and it may exclude from its meetings or any part of its meetings any persons it deems appropriate.
An independent director who is either an attorney or a person with expertise in international regulatory enforcement or compliance shall be consulted in setting the agendas for meetings of the Committee with respect to international compliance issues.
IV. RESPONSIBILITIES AND DUTIES
Director Qualification, Nomination and Compensation
- Identify individuals qualified to become members of the Board consistent with criteria developed by the Committee and approved by the Board.
- Recommend to the Board director nominees to be presented for stockholder approval at the annual meetings of stockholders.
- Recommend to the Board director nominees to fill vacancies on the Board as necessary.
- Make recommendations to the Board regarding the size and composition of the Board and develop and recommend to the Board criteria (such as independence, experience relevant to the needs of NSE, leadership qualities, diversity and ability to represent the stockholders) for the selection of individuals to be considered as candidates for election to the Board.
- Make recommendations to the Board regarding changes in the compensation of non-employee directors.
- Assess, and make recommendations to the Board regarding, the independence of directors and director nominees under applicable standards.
Other Board Committees
- Evaluate the Board’s committee structure and make recommendations to the Board as the Committee deems necessary.
- Evaluate and make recommendations to the Board concerning the selection of Board committees and their respective chairs.
- The Committee shall review on an annual basis chief executive officer ("CEO") succession planning as well as succession planning and management development for other executive officer and key management positions.
- In the event it is necessary to select a new CEO, the Committee shall lead the process and may initiate evaluation, consideration and screening of potential candidates. However, the full Board has the final responsibility to select the new CEO.
Executive Chairman and CEO Performance Evaluations
The Committee, in consultation with the Board and the chair of the Executive Compensation Committee, shall be responsible for leading the process of evaluating the performance of NSE’s CEO and NSE’s executive chairman of the Board. The Committee may invite members of the Executive Compensation Committee to participate in this evaluation. The Chair shall report to the Board and the Executive Compensation Committee regarding the results of the performance evaluations.
Corporate Governance Principles
Develop and recommend to the Board for approval a set of corporate governance guidelines applicable to NSE and review such guidelines at least annually and recommend changes as necessary.
Review all stockholder proposals submitted to NSE (including any proposal relating to the nomination of a member of the Board) and the timeliness of submission thereof and recommend to the Board appropriate action, if any, on each such proposal.
Board and Management Evaluation
Oversee the annual evaluation of the Board and its committees and management.
Risk Assessment and Management
Oversee NSE’s risk assessment and risk management programs and plans for NSE’s corporate governance risks, operational risks not assigned to the Audit Committee, compliance and regulatory risks and reputational risks. The Committee shall discuss with management, and the Chair shall report to the Audit Committee, regarding such risk assessment and risk management and NSE’s related guidelines and policies.
The Committee shall have oversight and responsibility with respect to:
- NSE’s substantive regulatory, legal and/or compliance obligations in the foreign countries in which it operates, as well as compliance with U.S. laws that address operations outside the U.S. (such as the Foreign Corrupt Practices Act);
- Individual compliance programs developed to address specific legal and regulatory issues in the United States and foreign countries
- NSE’s education programs meant to ensure compliance with foreign legal and regulatory schemes;
- NSE’s review and evaluation of external complaints alleging lapses in NSE’s regulatory and compliance behavior; and
- Review and coordination between NSE and any non-U.S. regulatory agency.
The Committee is authorized to take the following actions with respect to its oversight and responsibility for compliance matters:
- The Committee can require management to conduct audits on compliance, regulatory, legal and/or ethical concerns;
- The Committee can direct whether it should be the direct recipient of the results of such an audit or whether the results shall initially be provided to management;
- The Committee can commission an external audit of compliance, regulatory, legal and/or ethical concerns;
- The Committee can retain outside counsel with appropriate expertise, and, in the sole discretion of the Committee, based on factors such as an actual or potential conflict of interest, the Committee can retain counsel that is not counsel to the company or senior management, and, at its discretion, can retain experts and consultants in the discharge of its responsibilities;
- The Committee may meet privately with any member of the NSE senior management team or any other NSE employee and may request such a meeting; and
- On a quarterly basis, the Committee will receive updates on (i) legal and regulatory changes in foreign markets where the Company does business or to foreign markets where the Company is contemplating expansion and (ii) the Company’s programs designed to promote compliance with the regulatory and legal requirements in the foreign markets.
The Committee should meet at least quarterly and should provide a report to the full Board at least quarterly, with the fourth quarterly meeting each fiscal year including a "year in review" presentation or discussion including any actual or potential compliance issues and NSE’s response thereto, as well as actions the Committee has taken with respect to such issues during that fiscal year.
- The Committee will have the sole authority, to the extent it deems necessary or appropriate, to retain, terminate, and approve the fees and other retention terms of a search firm to be used to identify director candidates. The Committee shall also have authority, to the extent it deems necessary or appropriate, to retain other outside advisors. NSE will provide for appropriate funding, as determined by the Committee, for payment of compensation to any search firm or other advisors retained by the Committee.
- The Committee will periodically review and make recommendations to the Board regarding director and officer liability insurance.
- The Committee will make regular reports to the Board and will propose any necessary action to the Board.
- The Committee will review and reassess the adequacy of this charter annually and recommend any proposed changes to the Board for approval.
- The Committee will perform a review and evaluation, at least annually, of the performance of the Committee, including by reviewing the compliance of the Committee with this Charter, and will report to the Board thereon.
- Financial Expert
- Independent Director