Matrikon's Board believes in the importance of maintaining sound corporate
governance practices, and has therefore established the Compensation and
Governance Committee to periodically review, evaluate and modify governance
processes as necessary.
The following table summarizes Matrikon's governance procedures according to
National Instrument 58-101.
| CSA Corporate Governance Guideline |
Comments |
|
|
| (a)
|
Disclose the identity of directors who
are independent.
|
| The independent directors are:
Hugh J. Bolton
C. Kent Jespersen
Robert Moore
Michael B. Percy
Janice G. Rennie
Eric Rosenfeld
The Board evaluates individual director independence based on Multilateral
Instrument 52-110 Section 1.4
|
| (b)
|
Disclose the identity of directors who
are not independent, and describe the basis for that determination.
|
|
Nizar J. Somji, founder, president and CEO of Matrikon is the only director
who is not considered independent under Multilateral Instrument 52-110 Section 1.4
|
| (c)
|
Disclose whether or not a majority of
directors are independent.
|
|
Six of Matrikon’s seven current directors (86%) are independent.
|
| (d)
|
If a director is presently a director of
any other issuer that is a reporting issuer (or the equivalent) in a
jurisdiction or a foreign jurisdiction, identify both the director and the
other issuer.
|
|
All directorships with other public entities for each director are disclosed in
the 2007 annual report (pages 16-17) and information circular (pages 8-10)
|
| (e)
|
Disclose whether or not the independent
directors hold regularly scheduled meetings at which non-independent directors
and members of management are not in attendance.
|
| The independent directors
regularly hold in camera sessions at in person board and committee
meetings. The Audit Committee also holds in camera sessions with the external
auditors and with management.
FY2007 In Camera Sessions
Board:................................................... 4
Audit Committee:................................... 4
Compensation & Governance Committee:.. 2
|
| (f)
|
Disclose whether or not the chair of the
board is an independent director. If the board has a chair or lead director who
is an independent director, disclose the identity of the independent chair or
lead director, and describe his or her role and responsibilities.
|
|
The board chairman, Hugh J. Bolton, is an independent director
|
| (g)
|
Disclose the attendance record of each
director for all board meetings held since the beginning of the issuer’s most
recently completed financial year.
|
|
| Director |
Committee
Meetings |
Board
Meetings |
% |
| Hugh Bolton |
4/4 |
10/10 |
100% |
| Kent Jespersen |
4/4 |
9/10 |
93% |
| David Kramer |
5/5 |
10/10 |
100% |
| Robert Moore |
4/5 |
10/10 |
93% |
| Michael Percy |
4/4 |
10/10 |
100% |
| Amin Rawji |
n/a |
6/6 |
100% |
| Janice Rennie |
5/5 |
10/10 |
100% |
| Eric Rosenfeld |
1/1 |
2/2 |
100% |
| Nizar J. Somji |
n/a |
10/10 |
100% |
The Board has established a minimum meeting attendance policy of 80%. Attendance
of less than this amount without extenuating circumstances would be a cause for
concern. Mr. Jesperson and Mr. Moore were both absent from conference call meetings
which were called on short notice.
|
|
|
| |
Disclose the text of the board’s written
mandate.
|
|
Matrikon's Charter of Expectations for the
Board and Individual Directors
is available on our website and was included as Appendix 2 to our information
circular for our December 9, 2005 annual and special meeting (the "2005 Circular"),
filed on SEDAR at www.sedar.com and such
appendix is incorporated by reference herewith.
The Board Charter discusses the responsibilities of the board and individual
directors and the Board's involvement in Matrikon's strategic planning process.
|
|
|
| (a)
|
Disclose whether or not the board has
developed written position descriptions for the chair and the chair of each
board committee.
|
| Click here
for Position descriptions.
|
| (b)
|
Disclose whether or not the board and CEO
have developed a written position description for the CEO.
|
| Click
here for a position description for the CEO.
|
| 4. |
Orientation & Continuing Education
|
|
| (a)
|
Briefly describe what measures the board
takes to orient new directors regarding
|
|
|
|
|
(i) the role of the board, its
committees and its directors, and
|
| The Board Charter of
Expectations outlines Matrikon’s expectations with respect to director
behaviour, roles and responsibilities. Each committee has a Terms of Reference
that outline the specific responsibilities of the committee.
|
|
(ii) the nature and operation of the
issuer’s business.
|
| Arrangements are made for
specific briefing sessions from appropriate senior personnel to help new
directors better understand Matrikon’s strategies and operations.
Senior managers and other Matrikon employees make frequent presentations at
board meetings on a variety of business issues and strategies. In addition,
external resources occasionally present at board meetings, including: insurance
agents, health, safety and environmental consultants.
Directors are invited to attend various Matrikon events, including the sales
conference, employee appreciation dinner and annual user conference (MVP).
Through these events, they have an opportunity to meet with employees and
clients and learn more about our business and our technology.
Directors may also attend industry conferences at Matrikon’s expense.
|
| (b)
|
Briefly describe what measures the board
takes to provide continuing education for its directors.
|
| Subject to board approval,
directors may enrol in professional development courses at Matrikon’s expense.
No directors were enrolled in professional development courses at Matrikon’s
expense in 2007.
|
| 5. |
Ethical Business Conduct
|
|
| (a)
|
Disclose whether or not the board has
adopted a written code for the directors, officers and employees. If the board
has adopted a written code:
|
| Matrikon has a
Business Code of Conduct that is applicable to all directors,
officers and employees.
|
|
|
(i) disclose how a person or company
may obtain a copy of the code.
|
| Our Business Code of Conduct is
available by clicking here and on
SEDAR at www.sedar.com.
It will be mailed to anyone requesting it by contacting Matrikon’s investor
relations department at 1-877-MATRIKON extension 4010.
|
|
(ii) describe how the board monitors
compliance with its code.
|
| All new employees are required
to read and sign off on the Code as part of the orientation process.
Employees are reminded annually about Matrikon’s policies, including the
Business Code of Conduct, as part of the annual performance review process.
|
|
|
(iii)provide a cross-reference to any
material change report filed since the beginning of the issuer’s most recently
completed financial year that pertains to any conduct of a director or
executive officer that constitutes a departure from the code.
|
| The Board has not granted any
waiver of the Code of Conduct nor has a material change report been required or
filed.
|
| (b)
|
Describe any steps the board takes to
ensure directors exercise independent judgement in considering transactions and
agreements in respect of which a director or executive officer has a material
interest.
|
| Matrikon’s Business Code of
Conduct outlines our conflict of interest guidelines.
If a director has a material interest in a specific topic, they are not
permitted to be present when the matter is discussed or voted upon. Care is
taken to ensure all director conflicts are documented in the meeting minutes.
|
| (c)
|
Describe any other steps the board takes
to encourage and promote a culture of ethical business conduct.
|
| Ethical business conduct is a
constant focus of the Board. Board members are encouraged to interact with
employees and members of the management team.
|
| 6. |
Nomination of Directors
|
|
| (a)
|
Describe the process by which the board
identifies new candidates for board nomination.
|
| The Compensation and Governance
Committee is responsible for identifying new candidates for recommendation to
the board. The committee considers the composition of the Board annually and
prepares recommendations for director nominees. In this process, the views and
recommendations of the Board Chairman, the Chief Executive Officer and all
directors are sought and considered.
See the Compensation & Governance Committee Terms of Reference
(appendix 2) Section E: Responsibilities and Authority – Nominations for additional information.
|
| (b)
|
Disclose whether or not the board has a
nominating committee composed entirely of independent directors.
|
| The Compensation
& Governance Committee is responsible for director
nominations and is composed entirely of independent directors.
|
| (c)
|
If the board has a nominating committee,
describe the responsibilities, powers and operation of the nominating
committee.
|
|
The Compensation and Governance Committee is responsible for nominations. Please
refer to the Compensation & Governance Committee Terms of Reference (appendix 2)
Section E: Responsibilities and Authority – Nominations for information regarding
the responsibilities, powers and operations of the committee.
|
|
|
| (a)
|
Describe the process by which the board
determines the compensation for the issuer’s directors and officers.
|
|
The Compensation and Governance Committee is responsible for reviewing and
approving the compensation of all senior officers of Matrikon, including the
general salary structure and short and long term incentive programs and bonuses.
The Committee regularly discusses personnel and human resource matters, including
recruitment and development, management succession and benefit plans.
The Committee reviews the adequacy of director compensation and ensures that it
realistically reflects the responsibilities and risks involved in being an effective director.
See the report on executive
compensation (page 24) and director compensation (page 11) contained in the
2007 Information Circular for additional information.
|
| (b)
|
Disclose whether or not the board has a
compensation committee composed entirely of independent directors.
|
| The Compensation
& Governance Committee is composed entirely of independent
directors.
|
| (c)
|
If the board has a compensation
committee, describe the responsibilities, powers and operation of the
compensation committee.
|
|
The Compensation and Governance Committee focuses on ensuring that human
resource strategies support Matrikon’s objectives and sustain shareholder
value, and on measuring Board performance with respect to governance standards.
The Compensation and Governance Committee is responsible for reviewing
compensation levels of senior management, for succession planning for the
Chief Executive Officer and for providing advice to the board concerning the
general oversight of compensation and governance matters.
The committee also acts as the Nominating Committee and assists the Board in
identifying individuals qualified to become Board members and recommending
director nominees.
See the
Compensation & Governance Committee Terms of Reference (appendix 2)
for additional information.
|
| (d)
|
If a compensation consultant or advisor
has, at any time since the beginning of the issuer’s most recently completed
financial year, been retained to assist in determining compensation for any of
the issuer’s directors and officers, disclose the identity of the consultant or
advisor and briefly summarize the mandate for which they have been retained.
|
| No compensation consultants or
advisors were retained in fiscal year 2006.
|
| 8. |
Other Board Committees
|
|
|
|
If the board has standing committees
other than the audit, compensation and nominating committees, identify the
committees and describe their function.
|
| None
|
|
|
|
|
Disclose whether or not the board, its
committees and individual directors are regularly assessed with respect to
their effectiveness and contribution. If assessments are regularly conducted,
describe the process used for the assessments. If assessments are not regularly
conducted, describe how the board satisfies itself that the board, its
committees, and its individual directors are performing effectively.
|
| The Compensation and Governance
Committee has the responsibility for assessing the board’s effectiveness as a
whole, as well as the effectiveness of the individual directors and the
committee’s of the board. A board performance review is conducted annually with
the findings reported to the board. The assessment process examines the
effectiveness of the board as a whole and specifically reviews areas that board
members believe could be improved to ensure the continued effectiveness of the
board in the execution of its responsibilities. A questionnaire addressing
board responsibility, organization, operations, communications and
effectiveness is completed by each director. The chairman of the board compiles
the results of the questionnaire. A separate evaluation of the board Chairman
is conducted by the chair of the Compensation and Governance Committee.
|