(i) serves as chairman of executive sessions of the
non-management
directors and (ii) consults with the Chairman on the establishment of the
agenda for each meeting of the Board, taking into account the suggestions of other directors. Interested parties who wish to communicate with the Board, its committees, the Chairman, the Lead Director or any other individual director should follow
the procedures described below under Stockholder Communications.
To facilitate candid discussion among the Companys
directors, the
non-management
directors meet in executive session in conjunction with each regular board meeting and as otherwise determined by the Lead Director. In addition, at least once a year, the
non-management
directors who are independent under NYSE listing standards meet in executive session in conjunction with a regular board meeting.
Adoption of Proxy Access
In January 2018, the Board approved amending and restating the Companys bylaws (as so amended and restated, the Fourth Amended and Restated
Bylaws, or Bylaws) to adopt proxy access. Pursuant to the proxy access provision, a stockholder, or group of up to 20 stockholders, owning at least 3% of the Companys outstanding shares that are entitled to vote generally in
the election of directors continuously for at least three years, may nominate and include in the Companys proxy materials director nominees not to exceed the greater of two directors or 20% of the Board, provided that the stockholder(s) and
the nominee(s) satisfy the requirements in the Bylaws.
Majority Voting for Directors
The Bylaws provide for the election of directors by a majority of the votes cast, however, the Companys Corporate Governance Guidelines
require any director who fails to receive the required number of votes to tender his or her resignation. In such event, the Nominating & Governance Committee would determine whether to accept such directors resignation, subject to the
Boards final approval. The Company believes that this majority vote standard ensures accountability and the opportunity for a positive mandate from the Companys stockholders.
The Role of the Board in Risk Oversight
In the normal course of its business, the Company is exposed to a variety of risks, including market risks relating to changes in commodity prices
and interest rates, technical risks affecting the Companys resource base, cybersecurity risks, political risks and credit and investment risk. The Companys executive officers attend regularly scheduled meetings of the Board, where they
conduct presentations to the Board on various strategic matters involving the Companys operations and are available to address any questions or concerns raised by the Board on risk management or any other matters. The Board, as a whole and
also at the committee level, oversees the strategic direction of the Company, and in doing so considers the potential rewards and risks of the Companys business opportunities and challenges, and monitors the development and management of risks
that impact the Companys strategic goals.
The Audit Committee assists the Board in fulfilling its oversight responsibilities by
monitoring the effectiveness of the Companys systems of financial reporting, auditing, internal controls and legal and regulatory compliance. In 2011, the Board established a Reserves Committee to assist the Board in its oversight of the risks
related to the Companys estimates of proved reserves of oil and natural gas. Additionally, to address risks related to the Companys hedging program, a group consisting of the Companys Chief Executive Officer, Chief Financial
Officer and Chief Operating Officer, Mr. Easter, an independent director, and other members of management regularly review the Companys hedging strategy and positions and make reports to the full Board.
The Nominating & Governance Committee advises the Board with respect to appropriate corporate governance practices and assists the Board in
implementing those practices as well as considers any other corporate governance issues that arise from time to time. Additionally, the Nominating & Governance Committee reviews the Companys Corporate Governance Guidelines at least
annually and recommends any proposed changes to the Board for approval. The Compensation Committee considers the risks associated with the Companys compensation policies and practices, with respect to both executive compensation and
compensation generally. The Compensation Committee also reviews, approves and administers the agreements, plans, policies and programs of the Company to compensate the Companys corporate officers and directors and reviews and approves the
plans, policies and programs of the Company to compensate the Companys
non-executive
employees.
Attendance at Annual Meetings
The Board encourages all directors to attend the annual
meetings of stockholders, if practicable. All of the Companys directors attended last years annual meeting.
Stockholder Communications
The Companys stockholders and other interested persons may communicate with the Board, any
committee of the Board, the Chairman of the Board, the Lead Director or any other individual director by sending communications to: Concho Resources Inc., One Concho Center, 600 West Illinois Avenue, Midland, Texas 79701, Attention: Senior Vice
President, General Counsel and Corporate Secretary.
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2018 PROXY STATEMENT
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15
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