The lead director is elected by the independent directors annually. The independent directors have elected
Mr. Kirk to serve as lead director. The duties of the lead director are to:
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Preside at all meetings of the board at which the chairman is not present, including executive sessions of the
independent directors;
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Serve as liaison between the chairman and the independent directors;
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Approve information sent to the board;
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Approve meeting agendas for the board;
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Approve meeting schedules to assure that there is sufficient time for discussion of all agenda items; and
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If requested by major shareholders, ensure that he or she is available for consultation and direct communication.
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In addition, the lead director has authority to call meetings of the independent directors.
The board, led by its GSR Committee, regularly reviews the boards leadership structure. The boards consideration is guided by two questions: would
stockholders be better served and would the board be more effective with a different structure. The boards views are informed by a review of the practices of other companies and insight into the preferences of top stockholders, as gathered
from face-to-face dialogue and review of published guidelines. The board also considers how board roles and interactions would change if its leadership structure
changed. The boards goal is for each director to have an equal stake in the boards actions and equal accountability to the corporation and its stockholders.
The board continues to believe that there is no uniform solution for a board leadership structure. Indeed, the company has had varying board leadership models
over its history, at times separating the positions of chairman and CEO and at times combining the two, and now utilizing a lead director.
Risk oversight by the board
It is managements responsibility to assess and manage the various risks TI faces. It is the boards
responsibility to oversee management in this effort. In exercising its oversight, the board has allocated some areas of focus to its committees and has retained areas of focus for itself, as more fully described below.
Management generally views the risks TI faces as falling into the following categories: strategic, operational, financial and compliance. The board as a whole
has oversight responsibility for the companys strategic and operational risks (e.g., major initiatives, competitive markets and products, sales and marketing, R&D and cybersecurity). Throughout the year the CEO discusses these risks with
the board. Additionally, at least once each year, the companys chief information officer provides information on the cybersecurity risks and the companys approach to protecting the companys data and systems infrastructure with the
board. In the event of a material cybersecurity event, management would notify the board and, in compliance with our procedures, determine the timing and extent of the response and public disclosure, and whether any future vulnerabilities are
expected.
TIs Audit Committee has oversight responsibility for financial risk (such as accounting, finance, internal controls and tax strategy).
Oversight responsibility for compliance risk is shared by the board committees. For example, the Audit Committee oversees compliance with the companys code of conduct and finance- and accounting-related laws and policies, as well as the
companys compliance program itself; the Compensation Committee oversees compliance with the companys executive compensation plans and related laws and policies; and the GSR Committee oversees compliance with governance-related laws and
policies, including the companys corporate governance guidelines.
The Audit Committee oversees the companys approach to risk management as a
whole. The companys CFO reviews the companys risk management process with the Audit Committee at least annually. In addition, the companys chief information officer reviews the companys information technology systems with the
Audit Committee periodically and includes a discussion of key cybersecurity risks as appropriate.
The boards leadership structure is
consistent with the board and committees roles in risk oversight. As discussed above, the board has found that its current structure and practices are effective in fully engaging the independent directors. Allocating various aspects of risk
oversight among the committees provides for similar engagement. Having the chairman and CEO review strategic and operational risks with the board ensures that the director most knowledgeable about the company, the industry in which it operates and
the competition and other challenges it faces shares those insights with the board, providing for a thorough and efficient process.
2021 PROXY STATEMENT
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