SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 6-K
REPORT OF FOREIGN PRIVATE ISSUER
Pursuant to Rule 13a-16 or 15d-16 under
the Securities Exchange Act of 1934
|
|
For the month of: March 2015 |
Commission File Number:
1-8481 |
BCE Inc.
(Translation of Registrants name into English)
1, carrefour Alexander-Graham-Bell, Building A , 8th
Floor, Verdun, Québec, Canada H3E 3B3, (514) 870-8777
(Address of principal executive offices)
Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.
Form 20-F [ ] |
Form 40-F [X] |
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): _____
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): _____
Indicate by check mark whether by furnishing the information contained in this Form, the registrant is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.
If Yes is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b): 82- _____.
Only the Notice of Annual General Shareholder Meeting and Management Proxy Circular furnished with this Form 6-K as Exhibit
99.1 is incorporated by reference in the registration statements filed by BCE Inc. with the Securities and Exchange Commission on Form F-3 (Registration Statement No. 333-12130), Form S-8 (Registration Statement No. 333-12780), Form S-8 (Registration Statement No. 333-12802) and Form F-10 (Registration Statement No. 333-199993). Except for the foregoing, no other document or portion of document furnished with this Form 6-K is incorporated by reference in BCE Inc.s registration statements. Notwithstanding any reference to BCE Inc.s Web site on the World Wide Web in the documents attached hereto, the information contained in BCE Inc.s site or any other site on the World Wide Web referred to in BCE Inc.s site is not a part of this Form 6-K and, therefore, is not furnished to the Securities and Exchange Commission.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
BCE Inc.
(signed) Michel Lalande |
Michel Lalande
Senior Vice-President General Counsel &
Corporate Secretary
Date: March 24, 2015 |
EXHIBIT INDEX
99.1 Notice of Annual General Shareholder Meeting and Management Proxy Circular.
99.2 Form of Proxy Form (Registered Shareholders).
Exhibit 99.1
1 |
Notice of 2015 Annual General Shareholder Meeting |
|
4 |
2 |
About Voting Your Shares |
|
5 |
3 |
What the Meeting Will Cover |
|
8 |
4 |
About the Nominated Directors |
|
11 |
5 |
Director Compensation |
|
18 |
6 |
Corporate Governance Practices |
|
22 |
7 |
Committee Reports |
|
35 |
|
EXECUTIVE COMPENSATION |
|
42 |
8 |
The Board of Directors Letter to Shareholders |
|
43 |
9 |
Compensation Discussion & Analysis |
|
45 |
10 |
President and CEO Compensation |
|
57 |
11 |
Compensation of Our Named Executive Officers |
|
60 |
|
12 |
Other Important Information |
|
76 |
13 |
Schedule A BCE Amended and Restated By-Law One |
|
78 |
14 |
Schedule B Shareholder Proposals |
|
83 |
Voting by proxy is the easiest way to vote |
Please refer to your proxy form or your voting instruction form included in this package or to section 2 entitled About Voting Your Shares for more information on the voting methods available to you.
If you elect to vote on the Internet or by telephone, you do not need to return your proxy form or voting instruction form.
On the Internet
By telephone
By fax
By mail
LETTER FROM THE CHAIR
OF THE BOARD AND
THE PRESIDENT AND CHIEF
EXECUTIVE OFFICER |
|
Dear fellow shareholders,
It is our pleasure to invite you to BCEs 2015 Annual General Shareholder Meeting to be held at 9:30 a.m. on Thursday, April 30, 2015 at the Design Exchange in Toronto.
If you are unable to attend in person, a live webcast of the meeting will be available on our website at BCE.ca.
As a shareholder, you have the right to vote your shares on all items that come before the meeting. Your vote is important and we encourage you to exercise your right in the manner that suits you best. We facilitate this process by enabling you to vote by proxy on the Internet, by phone, by fax or by mail. You can also vote in person at the meeting.
This circular provides details about all the items for consideration at the meeting, including information about nominated directors and their compensation, the auditors, our corporate governance practices, reports from the four standing committees of the Board, and shareholder proposals. It also contains detailed information about our philosophy, policies and programs for executive compensation and how your Board receives input from shareholders on these matters.
At the meeting, we will review our financial position, business operations and the value we are delivering to shareholders. We also look forward to responding to your questions.
Thank you for your support and continued confidence in BCE. We look forward to seeing you at this years meeting.
Sincerely, |
|
Thomas C. ONeill
Chair of the Board |
George A. Cope
President and CEO |
|
March 5, 2015 |
|
|
|
BCE Inc.
2015 PROXY CIRCULAR 1 |
Below are highlights of some of the important information you will find in this management proxy circular. These highlights do not contain all the information that you should consider. You should therefore read the circular in its entirety before voting.
Shareholder voting matters |
|
|
PAGE REFERENCE |
VOTING MATTER |
BOARD VOTE RECOMMENDATION |
FOR MORE INFORMATION |
Election of 13 Directors |
FOR each nominee |
8 and 11 |
Appointing Deloitte LLP as Auditors |
FOR |
8 |
Advisory Resolution on Executive Compensation |
FOR |
9 and 42 |
Amendments to BCEs By-Law One |
FOR |
9 and 78 |
SHAREHOLDER PROPOSALS |
|
|
Director Qualifications |
AGAINST |
10 and 83 |
Gender Equality |
AGAINST |
10 and 83 |
Business and Pricing Practices |
AGAINST |
10 and 84 |
|
|
|
|
|
|
BOARD AND |
|
|
|
|
|
|
|
|
COMMITTEE |
OTHER |
|
|
|
DIRECTOR |
|
INDE- |
COMMITTEE |
ATTENDANCE |
PUBLIC |
|
NAME |
AGE |
SINCE |
POSITION |
PENDENT |
MEMBERSHIPS |
2014 |
BOARDS |
TOP THREE COMPETENCIES |
B.K. Allen |
66 |
2009 |
Operating Partner
Providence Equity
Partners LLC |
Yes |
Compensation
Governance |
95% |
3 |
Risk Management, Technology and Telecommunications |
R.A. Brenneman |
68 |
2003 |
Corporate Director |
Yes |
Compensation (Chair)
Pension |
94% |
3 |
Investment Banking/Mergers & Acquisitions, CEO/Senior Management and Retail/Customer |
S. Brochu |
51 |
2010 |
President and CEO
Gaz Métro |
Yes |
Audit
Governance |
100% |
1 |
Government/Regulatory Affairs, CEO/Senior Management and Retail/Customer |
R.E. Brown |
70 |
2009 |
Corporate Director |
Yes |
Compensation
Governance (Chair) |
95% |
3 |
Investment Banking/Mergers & Acquisitions, CEO/Senior Management and Risk Management |
G.A. Cope |
53 |
2008 |
President and
CEO BCE Inc. and
Bell Canada |
No |
|
100% |
1 |
CEO/Senior Management, Media/Content
and Telecommunications |
D.F. Denison |
62 |
2012 |
Corporate Director |
Yes |
Audit
Pension (Chair) |
90% |
2 |
Accounting & Finance, CEO/Senior
Management and Risk Management |
R.P. Dexter |
63 |
2014 |
Chair and CEO
Maritime Travel Inc. |
Yes |
Audit
Pension |
100% |
4 |
Retail/Customer, Accounting & Finance
and Risk Management |
I. Greenberg |
72 |
2013 |
Corporate Director |
Yes |
Audit
Compensation |
89% |
1 |
CEO/Senior Management, Government/
Regulatory Affairs and Media/Content |
G.M. Nixon |
58 |
2014 |
Corporate Director |
Yes |
Compensation
Governance |
100% |
1 |
CEO/Senior Management, Investment
Banking/Mergers & Acquisitions and
Risk Management |
T.C. ONeill |
69 |
2003 |
Chair of the Board
BCE Inc. and
Bell Canada |
Yes |
(1) |
100% |
3 |
Accounting & Finance, CEO/Senior
Management and Risk Management |
R.C. Simmonds |
61 |
2011 |
Chair
Lenbrook Corporation |
Yes |
Audit
Governance |
100% |
|
Government/Regulatory Affairs,
Technology and Telecommunications |
C. Taylor |
69 |
2010 |
Corporate Director |
Yes |
Governance
Pension |
100% |
|
Government/Regulatory Affairs, Media/Content and Telecommunications |
P.R. Weiss |
67 |
2009 |
Corporate Director |
Yes |
Audit (Chair)
Pension |
100% |
2 |
Accounting & Finance, Investment Banking/Mergers & Acquisitions and Risk Management |
(1) |
As Chair of the Board, Mr. ONeill is not a member of any committee of the Board but attends as ex officio member on all committees. |
2
BCE Inc. 2015 PROXY CIRCULAR |
|
|
BCEs Board and management believe that strong corporate governance practices contribute to superior results in creating and maintaining shareholder value. That is why we continually seek to strengthen our leadership in corporate governance and ethical business conduct by adopting best practices and providing full transparency and accountability to our shareholders. The Board is responsible for the supervision of the business and affairs of the Corporation.
HIGHLIGHTS
-
Added an additional share ownership requirement for non-executive directors of 7x the annual fee
-
Appointed two new directors following the retirement of four directors, ensuring the appropriate mix of skills, expertise, experience and geographical representation is maintained at the Board level
- Adopted a Board diversity policy and a target that
women represent at least 25% of non-executive directors by the end of 2017
|
- Adopted amendments to BCEs By-law one that improve
our governance
- Conducted a comprehensive assessment of
the effectiveness and performance of the Board and its committees
- Approved our strategic plan, taking into account
the opportunities and risks of the business units for the upcoming year
|
|
Details on page 22 |
BCE is focused on a pay-for-performance approach for all team members, including our executives. In order to attract, motivate and retain top talent, the Corporation offers a competitive total compensation package, positioned at the 60th percentile of the comparator group.
- BASE SALARY: positioned at the median of our comparator group, rewards the scope and responsibilities of a position
- ANNUAL INCENTIVE:
positioned at the 75th percentile of our comparator group, encourages strong performance against yearly corporate and individual objectives
- LONG-TERM INCENTIVE:
brings total compensation to the 60th percentile of our comparator group, aligns with long-term interests of shareholders
The mix of vehicles awarded under the long-term incentive plan favours the execution of multiple objectives. For instance, the vesting of performance share units (PSUs) depends on the realization of our dividend growth policy, while stock options reflect our commitment to drive the share price for our stakeholders. Restricted share units (RSUs) provide a valuable retention tool in maintaining in place a world-class executive team.
2014 TARGET PAY AT RISK(1)
(1) |
Based on 2014 actual base salary. At-risk components are based on target levels. Excludes pension and other compensation elements. |
OVERVIEW OF EXECUTIVE COMPENSATION BEST PRACTICES ADOPTED BY BCE
-
Stringent share ownership requirements
-
Emphasis on pay at risk for executive compensation
-
Double trigger change-in-control policy
-
Anti-hedging policy on share ownership and incentive compensation
-
Clawbacks for the President & CEO and all EVPs as well as all option holders
|
-
Caps on all Supplemental Executive Retirement Plans (SERP) and annual bonus payouts, in addition to mid-term and long-term incentive grants
-
Vesting criteria fully aligned to shareholder interests
|
|
Details on page 55 |
|
|
BCE Inc.
2015 PROXY CIRCULAR
3 |
1 |
NOTICE OF 2015 ANNUAL
GENERAL SHAREHOLDER MEETING |
|
1 |
NOTICE OF 2015 ANNUAL GENERAL
SHAREHOLDER MEETING |
As a shareholder, it is very important that you read this material carefully and then vote your shares, either by proxy or in person at the meeting
In this document, you, your and shareholder refer to the common shareholders of BCE. We, us, our, Corporation and BCE refer to BCE Inc., unless otherwise indicated. The information in this document is at March 5, 2015, unless otherwise indicated. |
When
Thursday, April 30, 2015, 9:30 a.m. (Eastern time)
Where
Design Exchange, 234 Bay Street, Trading Floor, Toronto, Ontario
Webcast
A live webcast of the meeting will be available on our website at BCE.ca
What the meeting is about
1. receiving the financial statements for the year ended December 31, 2014, including the auditors reports
2. electing 13 directors who will serve until the end of the next annual shareholder meeting
3. appointing the auditors who will serve until the end of the next annual shareholder meeting
4. considering an advisory (non-binding) resolution on executive compensation
5. considering amendments to BCEs By-law one relating to advance notice of the nomination of directors, quorum and other matters, as set out in section 3.5 and in Schedule A
6. considering the three shareholder proposals described in Schedule B
The meeting may also consider other business that properly comes before it.
You have the right to vote
You are entitled to receive notice of and vote at our meeting, or any adjournment, if you are a holder of common shares of the Corporation on March 13, 2015.
You have the right to vote your shares on items 2 to 6 listed above and any other items that may properly come before the meeting or any adjournment.
Admission to the meeting
You will need to register with our transfer agent, CST Trust Company (CST), before entering the meeting.
Approval of this circular
The Board has approved the content of this circular and authorized it to be sent to each shareholder who is eligible to receive notice of and vote his or her shares at the meeting, and to each director and to the auditors.
By order of the Board,
Michel Lalande
Senior Vice-President General Counsel and Corporate Secretary
Montréal, Québec
March 5, 2015
4
BCE Inc. 2015 PROXY CIRCULAR |
|
|
|
ABOUT
VOTING YOUR SHARES |
2 |
2 |
ABOUT VOTING YOUR SHARES |
The record date for determining shareholders entitled to vote is March 13, 2015. You have one vote for each common share you hold on that date. As at March 5, 2015, 841,389,487 common shares were outstanding.
You are a registered shareholder when your name appears on your share certificate. Your proxy form tells you whether you are a registered shareholder.
OPTION 1 BY PROXY (PROXY FORM)
You may give your voting instructions in the following manner:
INTERNET: go to www.cstvotemyproxy.com and follow the instructions
TELEPHONE: call 1-888-489-7352 (Canada and the United States) or 1-800-1960-1968 (other countries)
If you vote by telephone, you cannot appoint anyone other than the directors named on your proxy form as your proxyholder
FAX: complete the proxy form and return it by fax at 1-866-781-3111 (Canada and the United States) or 416-368-2502 (other countries)
MAIL: return the completed proxy form in the prepaid envelope provided
Our transfer agent, CST, must receive your proxy form or you must have voted by Internet or telephone before 4:45 p.m. (Eastern time) on Wednesday, April 29, 2015.
OPTION 2 IN PERSON AT THE MEETING
You do not need to complete or return your proxy form. You have to see a representative of CST before entering the meeting to register your attendance. Voting in person at the meeting will automatically cancel any proxy you completed and submitted earlier.
Non-registered shareholders |
You are a non-registered shareholder when an intermediary (a bank, trust company, securities broker or other financial institution) holds your shares on your behalf. When you receive a voting instruction form, this tells you that you are a non-registered shareholder.
OPTION 1 BY PROXY (VOTING INSTRUCTION FORM)
You may give your voting instructions in the following manner:
INTERNET: go to www.ProxyVote.com and follow the instructions
TELEPHONE: call 1-800-474-7493 (English) or 1-800-474-7501 (French)
If you vote by telephone, you cannot appoint anyone other than the directors named on your voting instruction form as your proxyholder
FAX: complete the voting instruction form and return it by fax to 905-507-7793 or 514-281-8911
MAIL: return your voting instruction form in the prepaid envelope provided
Your intermediary must receive your voting instructions with sufficient time to allow your voting instruction form to be forwarded by your intermediary to CST before 4:45 p.m. (Eastern time) on Wednesday, April 29, 2015. If you vote by Internet or telephone, you must do so prior to 4:45 p.m. (Eastern time) on Wednesday, April 29, 2015.
Alternatively, you may be a non-registered shareholder who will receive from your intermediary a proxy form that has been pre-authorized by your intermediary indicating the number of shares to be voted, which is to be completed, dated, signed and returned to CST by mail or fax.
OPTION 2 IN PERSON AT THE MEETING
We do not have access to the names or holdings of our non-registered shareholders. That means you can only vote your shares in person at the meeting if you have previously appointed yourself as the proxyholder for your shares by printing your name in the space provided on the voting instruction form and submitting it as directed on the form. At the meeting, you should see a CST representative.
If you are unsure whether you are a registered or non-registered shareholder, please contact CST by email at bce@canstockta.com or by telephone: 1-800-561-0934 (in Canada and the United States) or 416-682-3861 (other countries) |
If you are an individual shareholder, you or your authorized attorney must sign the proxy or voting instruction form. If you are a corporation or other legal entity, an authorized officer or attorney must sign the proxy or voting instruction form.
|
|
BCE Inc.
2015 PROXY CIRCULAR
5 |
2 |
ABOUT VOTING
YOUR SHARES |
|
2.2 How your shares will be voted |
You can choose to vote For, Withhold or Against depending on the items to be voted on.
When you sign the proxy form or voting instruction form, you authorize S. Brochu, G.A. Cope, T.C. ONeill or C. Taylor, who are all directors, to vote your shares for you at the meeting according to your instructions.
If you return your proxy form or voting instruction form and do not tell us how you want to vote your shares, your vote will be counted:
-
FOR electing the 13 nominated directors listed in the circular
-
FOR appointing Deloitte LLP as auditors
-
FOR approving the advisory resolution on executive compensation
-
FOR approving the amendments to BCEs By-law one
-
AGAINST the three shareholder proposals.
You may appoint another person to go to the meeting and vote your shares for you. If you wish to do so, strike out the four names of the directors and write the name of the person voting for you in the space provided. This person does not have to be a shareholder. He or she must be present at the meeting to vote your shares. Your proxyholder will vote your shares as he or she sees fit on any amendments to the items to be voted on and on any other items that may properly come before the meeting or any adjournment.
You can change a vote you made by proxy by:
-
voting again on the Internet or by telephone before
4:45 p.m. (Eastern time) on Wednesday, April 29, 2015
-
if you are a registered shareholder, completing a proxy form that is dated later than the proxy form you are changing and mailing it as instructed on your proxy form so that it is received before
4:45 p.m. (Eastern time) on Wednesday, April 29, 2015
-
if you are a non-registered shareholder, contacting your intermediary to find out what to do.
If you are a registered shareholder, you can also revoke a vote you made by proxy by sending a notice in writing from you or your authorized attorney to our Corporate Secretary so that it is received before
4:45 p.m. (Eastern time) on Wednesday, April 29, 2015, or by giving a notice in writing from you or your authorized attorney to the Chair of the meeting, at the meeting or any adjournment thereof.
2.4 How the votes are counted |
The election of directors (subject to our majority voting guidelines see section 3.2 entitled Electing directors), appointment of the auditors, approval of the advisory resolution on executive compensation, approval of the amendments to BCEs By-law one and the vote on the shareholder proposals will each be determined by a majority of votes cast at the meeting by proxy or in person.
CST counts and tabulates the votes. It does this independently of us to make sure that the votes of individual shareholders are confidential. Proxy forms or voting instruction forms are referred to us only when it is clear that a shareholder wants to communicate with management, the validity of the form is in question or the law requires it.
6
BCE Inc. 2015 PROXY CIRCULAR |
|
|
|
ABOUT
VOTING YOUR SHARES |
2 |
2.6 Electronic voting at the meeting |
Voting on all proposals at the meeting will be done through the use of electronic ballot. This allows us to expedite the voting process and present the final votes on screen at the meeting.
On arrival at the meeting, all shareholders entitled to vote will be required to register with our transfer agent, CST, and given a hand-held device containing a personalized smart card with details of their shareholding to be used for the electronic vote. After each proposal is put to the meeting by the Chair, you will be asked to cast your vote by pressing a button on your keypad. All the votes represented by shareholders present at the meeting will be counted and added to those voted by proxy, and the final votes will be shown on screen at the meeting.
If you have already voted by proxy, you will not need a hand-held device as your vote will already have been registered. However, should you wish to change your vote and you are a registered shareholder, you will still be able to do so at the meeting using the hand-held device, and your vote on the day of the meeting will replace your vote by proxy.
To help you make an informed decision, please read this circular and our annual report for the year ended December 31, 2014, which you can access on our website at
BCE.ca, on SEDAR at sedar.com and on EDGAR at sec.gov. This circular tells you about the meeting, the nominated directors, the proposed auditors, the Boards committees, our corporate governance practices, compensation of directors and executives, amendments to BCEs By-law one and the shareholder proposals. The annual report gives you a review of our activities for the past year and includes a copy of our annual financial statements and the related managements discussion and analysis of financial condition and results of operations (MD&A).
Proxy materials are sent to our registered shareholders through our transfer agent, CST. We do not send proxy-related materials directly to non-registered shareholders, and instead use the services of Broadridge Investor Communication Solutions, Canada, who acts on behalf of intermediaries to send proxy materials. We intend to pay intermediaries to send proxy-related materials and voting instruction forms to objecting non-registered shareholders.
If you have any questions about the information contained in this document or require assistance in completing your proxy form or voting instruction form, please contact our proxy solicitation agent, D.F. King Canada, a division of CST Investor Services Inc. (D.F. King).
North American Toll Free Phone: 1-866-822-1244
Banks, Brokers and Collect Calls: 416-682-3825
Facsimile: 647-351-3176
or North American Toll Free Facsimile: 1-888-509-5907
Email: inquiries@dfking.com
Your proxy is solicited by management. In addition to solicitation by mail, our employees or agents may solicit proxies by telephone or other ways at a nominal cost. We have retained D.F. King to solicit proxies for us in Canada and the United States at an estimated cost of $40,000. We pay the costs of these solicitations.
|
|
BCE Inc.
2015 PROXY CIRCULAR
7 |
3 |
WHAT THE MEETING WILL COVER |
|
3 |
WHAT THE MEETING WILL COVER |
3.1 Receiving our financial statements |
BCEs annual audited financial statements are included in our 2014 annual report.
Please see section 4 entitled About the Nominated Directors for more information. Directors appointed at the meeting will serve until the end of the next annual shareholder meeting, or until their resignation, if earlier.
All of the individuals nominated for election as directors are currently members of the Board and each was elected at our 2014 annual shareholder meeting held on May 6, 2014, by at least a majority of the votes cast, with the exception of Mr. Robert P. Dexter and Mr. Gordon M. Nixon, who were respectively appointed to the Board on November 1 and November 4, 2014. The Board recommends that you vote
FOR the election of the 13 individuals nominated.
MAJORITY VOTING
Our guidelines with respect to the election of directors are that if any director nominee at an uncontested election does not receive a greater number of votes For his or her election than votes Withheld from such election, then such director nominee must immediately tender his or her resignation to the Board. The resignation will take effect only upon acceptance by the Board.
Within 90 days, the Board must determine either to accept or not the resignation and we will issue a press release announcing the Boards determination, including, in cases where the Board has determined not to accept the resignation, the reasons therefor. It is generally expected that the Governance Committee will recommend that the Board accept such resignation, except in exceptional circumstances.
You will be electing the 13 members of your Board |
If you do not specify how you want your shares voted, the directors named as proxyholders in the enclosed proxy form or voting instruction form intend to cast the votes represented by proxy at the meeting FOR the election as directors of the nominated directors in this circular.
3.3 Appointing the auditors |
The Board, on the advice of the Audit Committee, recommends that Deloitte LLP be reappointed as auditors. Deloitte LLP and its predecessors have been the auditors of the Corporation since it was created in 1983. The audit firm appointed at the meeting will serve until the end of the next annual shareholder meeting.
Every year, the Audit Committee performs an assessment of the quality of the services rendered and the performance by Deloitte LLP as auditors of the Corporation. This assessment is based, among other things, on the audit plan submitted, the risk areas identified, the nature of the audit findings and the reports presented to the Audit Committee. Given the satisfactory results of the assessment regarding the 2014 audit, the Board, on the advice of the Audit Committee, recommends that you vote
FOR the appointment of Deloitte LLP as auditors of the Corporation.
You will be appointing your auditors |
If you do not specify how you want your shares voted, the directors named as proxyholders in the enclosed proxy form or voting instruction form intend to cast the votes represented by proxy at the meeting FOR the appointment of Deloitte LLP as auditors.
EXTERNAL AUDITORS FEES
The table below shows the fees that BCEs external auditors, Deloitte LLP, billed to BCE and its subsidiaries for various services in each of the past two fiscal years.
|
2014 |
|
2013 |
|
(IN $ MILLIONS) |
|
(IN $ MILLIONS) |
Audit fees(1) |
9.4 |
|
9.9 |
Audit-related fees(2) |
1.7 |
|
1.7 |
Tax fees(3) |
0.6 |
|
0.6 |
All other fees(4) |
0.6 |
|
1.0 |
Total(5) |
12.3 |
|
13.2 |
(1) |
These fees include professional services provided by the external auditors for statutory audits of the annual financial statements, the audit of the effectiveness of internal control over financial reporting, the review of interim financial reports, the review of financial accounting and reporting matters, the review of securities offering documents, other regulatory audits and filings and translation services.
|
(2) |
These fees relate to non-statutory audits and due diligence procedures. |
(3) |
These fees include professional services for tax compliance, tax advice and assistance with tax audits and appeals. |
(4) |
These fees include any other fees for permitted services not included in any of the above-stated categories. In 2013 and 2014, the fees are for services related to compliance with the Payment Card Industry Data Security Standard. |
(5) |
The amounts of $12.3 million for 2014 and $13.2 million for 2013 reflect fees billed in those fiscal years without taking into account the year to which those services relate. Total fees for services provided for each fiscal year amounted to $10.2 million in 2014 and $10.5 million in 2013. |
8
BCE Inc. 2015 PROXY CIRCULAR |
|
|
|
WHAT THE
MEETING WILL COVER |
3 |
3.4 Considering an advisory resolution on executive compensation |
Our executive compensation philosophy, policies and programs are based on the fundamental principle of pay-for-performance to align the interests of our executives with those of our shareholders. This compensation approach allows us to attract and retain high-performing executives who will be strongly incented to create value for our shareholders on a sustainable basis. As a shareholder you are asked to consider the following resolution:
Resolved, on an advisory basis and not to diminish the role and responsibilities of the Board of Directors, that the shareholders accept the approach to executive compensation disclosed in this management proxy circular delivered in advance of the 2015 Annual Meeting of Shareholders of BCE.
The Board recommends that you vote FOR this resolution.
Because your vote is advisory, it will not be binding upon the Board. However, the Management Resources and Compensation Committee of the Board (Compensation Committee) will review and analyze the results of the vote and take into consideration such results when reviewing executive compensation philosophy, policies and programs. Please see section 6.2 entitled Shareholder engagement for more details on how you can ask questions and provide comments to the Board and the Compensation Committee on executive compensation. The Board believes that our current practices achieve substantially the same results as the Canadian Coalition for Good Governances (CCGG) Model Policy of the Board of Directors on Engagement with Shareholders on Governance Matters and Say on Pay Policy for Boards of Directors.
You will vote on an advisory resolution on executive compensation |
If you do not specify how you want your shares voted, the directors named as proxyholders in the enclosed proxy form or voting instruction form intend to cast the votes represented by proxy at the meeting FOR the adoption of the advisory resolution on executive compensation.
3.5 Considering amendments to BCEs By-law one |
You will be voting on the confirmation of certain amendments to By-law one of the Corporation that were adopted by the Board, on the recommendation of the Governance Committee, on February 5, 2015 (By-Law Amendments). The By-Law Amendments are summarized out below.
ADVANCE NOTICE REQUIREMENT
The By-Law Amendments incorporate an advance notice requirement for director nominations. The purpose of this requirement is to ensure that all shareholders receive adequate notice of director nominations and sufficient information with respect to all director nominees in connection with any annual or special meeting of shareholders. The Board believes that this requirement establishes a transparent and fair process for all shareholders to follow if they intend to nominate directors, and for all shareholders to have sufficient time and information before they vote for the election of directors.
The amendment requires that a shareholder seeking to nominate individuals for election as directors provide timely notice thereof in proper written form to the Corporate Secretary of the Corporation. To be timely, the notice must be given (i) in the case of an annual meeting of shareholders, no later than the close of business on the 30th day before the date of the annual meeting of shareholders (unless the annual meeting of shareholders is to be held on a date that is less than 50 days after the date on which the first public announcement of the date of the annual meeting was made, in which case the notice may be given not later than the close of business on the 10th day following the date of the public announcement), and (ii) in the case of a special meeting (which is not also an annual meeting) of shareholders called for the purpose of electing directors, no later than the close of business on the 15th day following the day on which the first public announcement of the date of the special meeting was made. The By-Law Amendments also set forth the information that a shareholder must include in the notice for it to be in proper written form.
The advance notice requirements included in the By-Law Amendments do not interfere with the ability of shareholders to requisition a meeting or nominate directors by way of shareholder proposal in accordance with the Canada Business Corporations Act.
INCREASED QUORUM REQUIREMENTS
The By-Law Amendments also update our quorum requirements for shareholder and director meetings. In particular, the amendments (i) increase the quorum requirement for shareholder meetings to at least two shareholders representing 25% of the outstanding shares (from 20%), (ii) increase the quorum requirement for director meetings to at least a majority of the directors (from three directors), and (iii) eliminate the casting vote of the Chair at meetings of shareholders and directors.
You will be voting on amendments to BCEs By-law one that improve our governance |
The foregoing is only a summary of the principal provisions of the By-Law Amendments. The full text of the By-Law Amendments, as integrated into an amended and restated By-law one of the Corporation, is set out in Schedule A, showing the changes made (additions are underlined, text removed is struck out). Shareholders are encouraged to review the By-Law Amendments in their entirety.
|
|
BCE Inc.
2015 PROXY CIRCULAR
9 |
3 |
WHAT THE MEETING WILL COVER |
|
The By-Law Amendments will come into effect upon their confirmation by shareholders at the meeting.
The resolution to confirm the By-Law Amendments is as follows:
Resolved, as an ordinary resolution, that the amendments to By-law one of the Corporation, in the form adopted by the Board of Directors of BCE Inc. on February 5, 2015 and reflected in the amended and restated By-law one of the Corporation attached as Schedule A to the management proxy circular of the Corporation dated March 5, 2015, be and are hereby confirmed.
We believe that these changes and updates are to the benefit of shareholders and demonstrate our continued commitment to adopt the highest possible standards of corporate governance. Accordingly, the Board recommends that you vote
FOR the resolution approving the By-Law Amendments. In order to be confirmed, the resolution requires the affirmative vote of a simple majority of the votes cast, in person or by proxy, at the meeting.
If you do not specify how you want your shares voted, the directors named as proxyholders in the enclosed proxy form or voting instruction form intend to cast the votes represented by proxy at the meeting FOR the resolution approving the By-Law Amendments.
3.6 Considering the shareholder proposals |
You will be voting on three shareholder proposals that have been submitted for consideration at the meeting. These proposals are set out in Schedule B. The Board recommends that you vote
AGAINST each proposal.
You will be voting on three shareholder proposals |
If you do not specify how you want your shares voted, the directors named as proxyholders in the enclosed proxy form or voting instruction form intend to cast the votes represented by proxy at the meeting AGAINST the three shareholder proposals in accordance with the Boards recommendations set out in Schedule B.
Following the conclusion of the formal business to be conducted at the meeting, we will:
-
provide an update on our business operations, and
-
invite questions and comments from shareholders.
If you are not a shareholder, you may be allowed into the meeting after speaking with a representative of CST and if the Chair of the meeting allows it.
As of the date of this circular, management is not aware of any changes to these items and does not expect any other items to be brought forward at the meeting. If there are changes or new items, your proxyholder can vote your shares on these items as he or she sees fit.
10
BCE Inc. 2015 PROXY CIRCULAR |
|
|
|
ABOUT THE
NOMINATED DIRECTORS |
4 |
4 |
ABOUT THE
NOMINATED DIRECTORS |
The following pages include a profile of each nominated director with an explanation of his or her experience, qualifications, top three areas of expertise, participation on the Board and its committees, ownership, value of equity securities of BCE and extent of fulfillment of the BCE share ownership requirements, as well as participation on the boards of other public companies. A more detailed description of our directors skills can be found under the heading Competency Requirements in section 6 entitled Corporate Governance Practices. For current committee memberships and current committee chairpersons, please refer to section 7 entitled Committee Reports. For more information on the compensation paid to non-management directors, please refer to section 5 entitled Director Compensation.
The following table discloses the total holdings of BCE common shares and deferred share units (DSUs) of the nominated directors as of March 6, 2014 and March 5, 2015. The total value of common shares/DSUs is determined by multiplying the number of common shares and DSUs of BCE held by each nominee as of March 6, 2014 and March 5, 2015 by the closing price of BCEs common shares on the Toronto Stock Exchange as of the close of business on March 6, 2014 and March 5, 2015, respectively, being $48.26 and $55.10.
TOTAL SHAREHOLDINGS OF NOMINATED DIRECTORS
MARCH 6, 2014 |
|
|
|
MARCH 5, 2015 |
|
BCE Common Shares |
349,364 |
|
|
BCE Common Shares |
406,444 |
BCE Deferred Share Units |
1,151,056 |
|
|
BCE Deferred Share Units |
1,264,393 |
Value ($) |
72,410,269 |
|
|
Value ($) |
92,063,118 |
Your directors own a significant shareholding interest in BCE, aligning their interests with yours |
|
|
|
OPERATING PARTNER
Providence
Equity Partners
Since September 2007
Age - 66
Status - Independent
Joined Board - May 2009
Areas of Expertise
Risk Management
Technology
Telecommunications
2014 Annual Meeting
Votes in favour: 98.93% |
|
Mr. Allen is an Operating Partner of Providence Equity Partners LLC (a private equity firm focused on media, entertainment, communications and information investments). Prior to joining Providence in 2007, he was Executive Vice-President of Operations of Qwest Communications International (a telecommunications company), responsible for the companys network and information technology operations and, prior to 2004, Executive Vice-President of Operations and Chief Human Resources Officer. In addition, since 2000, Mr. Allen has served as President of Allen Enterprises, LLC, a private equity investment and management company he founded. Mr. Allen holds a Bachelor of Arts degree from the University of Kentucky and an M.B.A. from Boston University. |
BOARD &
COMMITTEE ATTENDANCE DURING 2014 |
|
REGULAR |
SPECIAL |
TOTAL |
|
|
TOTAL BOARD & COMMITTEE ATTENDANCE |
|
Board |
6/6 |
4/5 |
10/11 |
|
|
|
|
Compensation Committee |
4/4 |
1/1 |
5/5 |
|
|
95% |
|
Governance Committee |
4/4 |
- |
4/4 |
|
|
|
|
OTHER PUBLIC BOARD DIRECTORSHIPS |
|
PRESENT BOARDS |
|
|
PAST BOARDS (LAST FIVE YEARS) |
|
CDW Corporation |
2008 present |
|
|
|
|
Fiduciary Management, Inc. |
1996 present |
|
|
N/A |
|
Harley-Davidson, Inc. |
1992 present |
|
|
|
|
OWNERSHIP AND TOTAL VALUE OF EQUITY |
|
MARCH 6, 2014 |
|
|
MARCH 5, 2015 |
|
BCE Common Shares |
22,500 |
|
|
BCE Common Shares |
22,500 |
BCE DSUs |
11,533 |
|
|
BCE DSUs |
14,160 |
Value ($) |
1,642,433 |
|
|
Value ($) |
2,019,966 |
SHARE OWNERSHIP REQUIREMENTS - TARGET DATE TO MEET |
Five-Year Target |
Met (354%) |
|
|
Ten-Year Target |
Met (152%) |
|
|
BCE Inc.
2015 PROXY CIRCULAR
11 |
4 |
ABOUT THE
NOMINATED DIRECTORS |
|
|
|
|
CORPORATE DIRECTOR
Since March 2010
Age - 68
Status - Independent
Joined Board -
November 2003
Areas of Expertise Investment Banking/Mergers & Acquisitions CEO/Senior
Management Retail/Customer
2014 Annual Meeting
Votes in favour: 98.99% |
|
Mr. Brenneman is a corporate director and was Executive Vice-Chairman, Suncor Energy Inc. (an integrated energy company) from August 2009 until February 2010 and was President and CEO of Petro-Canada (a petroleum company) from 2000 until August 2009. Before 2000, Mr. Brenneman spent more than 30 years with Imperial Oil Limited and its parent company, Exxon Mobil Corporation (both petroleum companies). He was a member of the board of the Canadian Council of Chief Executives until July 2009. Mr. Brenneman holds a B.Sc. in Chemical Engineering from the University of Toronto and a M.Sc. in Control Systems from the University of Manchester. |
BOARD & COMMITTEE ATTENDANCE DURING 2014 |
|
REGULAR |
SPECIAL |
TOTAL |
|
|
TOTAL BOARD & COMMITTEE ATTENDANCE |
|
Board |
6/6 |
4/5 |
10/11 |
|
|
94% |
|
Compensation Committee (Chair) |
4/4 |
1/1 |
5/5 |
|
|
|
Pension Committee |
1/1 |
- |
1/1 |
|
|
|
OTHER PUBLIC BOARD DIRECTORSHIPS |
|
PRESENT BOARDS |
|
|
PAST BOARDS (LAST FIVE YEARS) |
|
Ithaca Energy Inc. |
2010 present |
|
|
|
|
The Bank of Nova Scotia |
2000 present |
|
|
N/A |
|
WestJet Airlines Ltd. |
2009 present |
|
|
|
|
OWNERSHIP AND TOTAL VALUE OF EQUITY |
|
MARCH 6, 2014 |
|
|
MARCH 5, 2015 |
|
BCE Common Shares |
115,000 |
|
|
BCE Common Shares |
123,804 |
BCE DSUs |
49,094 |
|
|
BCE DSUs |
54,107 |
Value ($) |
7,919,176 |
|
|
Value ($) |
9,802,896 |
SHARE OWNERSHIP REQUIREMENTS - TARGET DATE TO MEET |
Five-Year Target |
Met (1,720%) |
|
|
Ten-Year Target |
Met (737%) |
|
|
|
PRESIDENT AND CEO
Gaz Métro
Since February 2007
Age - 51
Status - Independent
Joined Board - May 2010
Areas of Expertise
Government &
Regulatory Affairs
CEO/Senior
Management
Retail/Customer
2014 Annual Meeting
Votes in favour: 98.80% |
|
Ms. Brochu has been active in the energy industry for more than 25 years. She began her career in 1987 as a financial analyst for SOQUIP (Société québécoise dinitiatives pétrolières). In 1997, she joined Gaz Métro Inc. (a diversified energy company), as Vice-President, Business Development. In 2005, Ms. Brochu was appointed Executive Vice-President. Since 2007, she has held the position of President and CEO of Gaz Métro Inc. and is a member of its Board of Directors. Ms. Brochu graduated in Economics from Université Laval, in Québec City, where she specialized in the energy sector. Ms. Brochu is actively involved with Centraide of Greater Montreal. She is also a director of Fondation Chagnon. She is the Chair of Forces Avenir, which promotes students involvement in their communities. She co-founded 80, ruelle de lAvenir, a project aimed at encouraging students in the Centre-Sud and Hochelaga neighbourhoods of Montréal to stay in school. |
BOARD & COMMITTEE ATTENDANCE DURING 2014 |
|
REGULAR |
SPECIAL |
TOTAL |
|
|
TOTAL BOARD & COMMITTEE ATTENDANCE |
|
Board |
6/6 |
5/5 |
11/11 |
|
|
|
|
Audit Committee |
5/5 |
- |
5/5 |
|
|
100% |
|
Governance Committee |
4/4 |
- |
4/4 |
|
|
|
|
OTHER PUBLIC BOARD DIRECTORSHIPS |
|
PRESENT BOARDS |
|
|
PAST BOARDS (LAST FIVE YEARS) |
|
Bank of Montreal |
2011 present |
|
|
N/A |
|
OWNERSHIP AND TOTAL VALUE OF EQUITY |
|
MARCH 6, 2014 |
|
|
MARCH 5, 2015 |
|
BCE Common Shares |
1,250 |
|
|
BCE Common Shares |
1,250 |
BCE DSUs |
17,613 |
|
|
BCE DSUs |
22,589 |
Value ($) |
910,328 |
|
|
Value ($) |
1,313,529 |
SHARE OWNERSHIP REQUIREMENTS -
TARGET DATE TO MEET |
Five-Year Target |
Met (230%) |
|
|
Ten-Year Target |
April 1, 2024 (99%) |
12
BCE Inc. 2015 PROXY CIRCULAR |
|
|
|
ABOUT THE
NOMINATED DIRECTORS |
4 |
|
|
|
CORPORATE DIRECTOR
Since October 2009
Age - 70
Status - Independent
Joined Board - May 2009
Areas of Expertise
Investment Banking/Mergers & Acquisitions
CEO/Senior
Management
Risk Management
2014 Annual Meeting
Votes in favour: 98.72% |
|
Mr. Brown is a corporate director and Chair of Aimia Inc. (formerly Groupe Aeroplan Inc., a loyalty program management company). He was President and CEO of CAE Inc. (a provider of simulation and modelling technologies as well as integrated training services for both civil aviation and defence customers) from 2004 to September 2009. Prior to joining CAE, Mr. Brown was Chair of Air Canada (an airline) during its restructuring from May 2003 to October 2004. Mr. Brown joined Bombardier Inc. (an aerospace, transportation and recreational products company) in 1987 and was responsible for the Bombardier Aerospace sector from 1990 to 1999. He was President and CEO of Bombardier Inc. from 1999 to 2002. Mr. Brown also held various senior positions in federal ministries with economic vocations, including the position of Associate Deputy Minister of the Department of Regional Industrial Expansion. Mr. Brown holds a Bachelor of Science degree from the Royal Military College and attended the Advanced Management Program at the Harvard University Business School. |
BOARD & COMMITTEE ATTENDANCE DURING 2014 |
|
REGULAR |
SPECIAL |
TOTAL |
|
|
TOTAL BOARD & COMMITTEE ATTENDANCE |
|
Board |
6/6 |
4/5 |
10/11 |
|
|
|
|
Compensation Committee |
4/4 |
1/1 |
5/5 |
|
|
95% |
|
Governance Committee (Chair) |
4/4 |
- |
4/4 |
|
|
|
|
OTHER PUBLIC BOARD DIRECTORSHIPS |
|
PRESENT BOARDS |
|
|
PAST BOARDS (LAST FIVE YEARS) |
|
Aimia Inc. (Chair) |
2005 present |
|
|
|
|
Rio Tinto Limited |
2010 present |
|
|
N/A |
|
Rio Tinto plc |
2010 present |
|
|
|
|
OWNERSHIP AND TOTAL VALUE OF EQUITY |
|
MARCH 6, 2014 |
|
|
MARCH 5, 2015 |
|
BCE Common Shares |
30,000 |
|
|
BCE Common Shares |
31,889 |
BCE DSUs |
11,454 |
|
|
BCE DSUs |
14,298 |
Value ($) |
2,000,570 |
|
|
Value ($) |
2,544,904 |
SHARE OWNERSHIP REQUIREMENTS -
TARGET DATE TO MEET |
Five-Year Target |
Met (446%) |
|
|
Ten-Year Target |
Met (191%) |
|
|
|
PRESIDENT AND CEO
BCE and Bell Canada
Since July 2008
Age - 53
Status - Not Independent
Joined Board - July 2008
Areas of Expertise
CEO/Senior
Management
Media/Content
Telecommunications
2014 Annual Meeting
Votes in favour: 96.85% |
|
Mr. Cope has served as President and CEO of BCE and
Bell Canada since July 2008. He was previously President and COO of Bell
Canada. A seasoned Canadian communications executive. Mr. Cope had
served in public-company CEO roles in the industry for more than 15
years prior to joining Bell in 2005. Mr. Cope holds an Honors Business
Administration degree from Western University and serves on the Advisory
Board of the universitys Ivey Business School. Mr. Cope is a Member of
the Order of Canada. |
BOARD & COMMITTEE ATTENDANCE DURING
2014 |
|
REGULAR |
SPECIAL |
TOTAL |
|
|
TOTAL BOARD & COMMITTEE ATTENDANCE |
|
Board |
6/6 |
5/5 |
11/11 |
|
|
100% |
|
OTHER PUBLIC BOARD DIRECTORSHIPS |
|
PRESENT BOARDS |
|
|
PAST BOARDS (LAST FIVE YEARS) |
|
Bank of Montreal |
2006 present |
|
|
Bell Aliant Inc. (Chair) |
2011 2014 |
|
|
|
|
NII Holdings, Inc. |
2004 2010 |
OWNERSHIP AND TOTAL VALUE OF EQUITY |
|
MARCH 6, 2014 |
|
|
MARCH 5, 2015 |
|
BCE Common Shares |
49,869 |
|
|
BCE Common Shares |
58,592 |
BCE DSUs |
964,007 |
|
|
BCE DSUs |
1,012,932 |
Value ($) |
48,929,656 |
|
|
Value ($) |
59,040,972 |
SHARE OWNERSHIP REQUIREMENTS -
TARGET DATE TO MEET |
Please see the heading Share Ownership
Requirements on page 53 under section 9 entitled Compensation
Discussion & Analysis for more details on Mr. Copes specific share
ownership requirements, which are currently exceeded. |
|
|
BCE Inc.
2015 PROXY CIRCULAR
13 |
4 |
ABOUT THE
NOMINATED DIRECTORS |
|
|
|
|
CORPORATE DIRECTOR
Since June 2012
CHARTERED
PROFESSIONAL
ACCOUNTANT
Age - 62
Status - Independent
Joined Board -
October 2012
Areas of Expertise
Accounting & Finance
CEO/Senior
Management
Risk Management
2014 Annual Meeting
Votes in favour: 99.10% |
|
Mr. Denison is a corporate director with extensive
experience in the financial services industry. He served as President
and CEO of the Canada Pension Plan Investment Board (an investment
management organization) from 2005 to 2012. Prior to that, Mr. Denison
was President of Fidelity Investments Canada Limited (a financial
services provider). He has also held a number of senior positions in the
investment banking, asset management and consulting sectors in Canada,
the United States and Europe. Mr. Denison serves as Chair of Bentall
Kennedy Limited Partnership (a real estate investment advisor) and
Vice-Chair of Sinai Health Systems (a provider of healthcare services).
He is also a member of the Investment Board and International Advisory
Committee of the Government of Singapore Investment Corporation, the
China Investment Corporation International Advisory Council, the World
Bank Treasury Expert Advisory Committee and the University of Toronto
Investment Advisory Committee. Mr. Denison earned bachelors degrees in
Mathematics and Education from the University of Toronto and is a Fellow
of CPA Ontario. |
BOARD & COMMITTEE ATTENDANCE DURING 2014 |
|
REGULAR |
SPECIAL |
TOTAL |
|
|
TOTAL BOARD & COMMITTEE ATTENDANCE |
|
Board |
6/6 |
3/5 |
9/11 |
|
|
|
|
Audit Committee |
5/5 |
- |
5/5 |
|
|
90% |
|
Pension Committee (Chair) |
4/4 |
- |
4/4 |
|
|
|
|
OTHER PUBLIC BOARD DIRECTORSHIPS |
|
PRESENT BOARDS |
|
|
PAST BOARDS (LAST FIVE YEARS) |
|
Allison Transmission Holdings, Inc. |
2013 present |
|
|
N/A |
|
Royal Bank of Canada |
2012 present |
|
|
|
OWNERSHIP AND TOTAL VALUE OF EQUITY |
|
MARCH 6, 2014 |
|
|
MARCH 5, 2015 |
|
BCE Common Shares |
- |
|
|
BCE Common Shares |
- |
BCE DSUs |
4,910 |
|
|
BCE DSUs |
9,683 |
Value ($) |
236,957 |
|
|
Value ($) |
533,533 |
SHARE OWNERSHIP REQUIREMENTS -
TARGET DATE TO MEET |
Five-Year Target |
April 1, 2019 (94%) |
|
|
Ten-Year Target |
April 1, 2024 (40%) |
|
|
|
CHAIR AND CEO
Maritime Travel Inc.
Since July 1979
Age - 63
Status - Independent
Joined Board -
November 2014
Areas of Expertise
Retail/Customer
Accounting & Finance
Risk Management
2014 Annual Meeting
Votes in favour: N/A |
|
Mr. Dexter is Chair and CEO of Maritime Travel Inc.
(an integrated travel company). He holds both a bachelors degree in
Commerce and a bachelors degree in Law from Dalhousie University and
was appointed Queens Counsel in 1995. Mr. Dexter has over 15 years of
experience in the communications sector, having served as a director of
Maritime Tel & Tel Limited from 1997 to 1999 prior to joining the
Aliant, and later the Bell Aliant boards until October 2014. Mr. Dexter
is also a counsel to the law firm Stewart McKelvey. |
BOARD & COMMITTEE ATTENDANCE DURING 2014 |
|
REGULAR |
SPECIAL |
TOTAL |
|
|
TOTAL BOARD & COMMITTEE ATTENDANCE |
|
Board |
2/2 |
2/2 |
4/4 |
|
|
|
|
Audit Committee |
- |
- |
- |
|
|
100% |
|
Pension Committee |
- |
- |
- |
|
|
|
|
OTHER PUBLIC BOARD DIRECTORSHIPS |
|
PRESENT BOARDS |
|
|
PAST BOARDS (LAST FIVE YEARS) |
|
Empire Company Limited (Chair) |
1987 present |
|
|
Bell Aliant Inc. |
1999 2014 |
High Liner Foods Incorporated |
1992 present |
|
|
Sobeys Inc. (Chair) |
1998 present |
|
|
Wajax Corporation |
1988 present |
|
|
OWNERSHIP AND TOTAL VALUE OF EQUITY |
|
MARCH 6, 2014 |
|
|
MARCH 5, 2015 |
|
BCE Common Shares |
N/A |
|
|
BCE Common Shares |
7,526 |
BCE DSUs |
N/A |
|
|
BCE DSUs |
17,544 |
Value ($) |
N/A |
|
|
Value ($) |
1,381,357 |
SHARE OWNERSHIP REQUIREMENTS -
TARGET DATE TO MEET |
Five-Year Target |
Met (242%) |
|
|
Ten-Year Target |
Met (104%) |
14
BCE Inc. 2015 PROXY CIRCULAR |
|
|
|
ABOUT THE
NOMINATED DIRECTORS |
4 |
|
|
|
CORPORATE DIRECTOR
Since July 2013
Age - 72
Status - Independent
Joined Board - July 2013
Areas of Expertise
CEO/Senior
Management
Government &
Regulatory Affairs
Media/Content
2014 Annual Meeting
Votes in favour: 83.55% |
|
Mr. Greenberg is a corporate director and one of
four brothers who founded Astral Media Inc. (a media company), which,
over its 50-year history, grew from a photographic company into one of
Canadas leaders in pay- and specialty-TV, radio, out-of-home
advertising and digital media. He was President and CEO of Astral Media
Inc. from 1995 until July 2013, during which time the company achieved
16 consecutive years of profitable growth. Born in Montréal, he is a
member of the Broadcasting Hall of Fame and a recipient of the
prestigious Ted Rogers and Velma Rogers Graham Award for his unique
contribution to the Canadian broadcasting system. With his brothers, he
also received the Eleanor Roosevelt Humanities Award for their active
support of numerous industry and charitable organizations. Mr. Greenberg
was a member of the Canadian Council of Chief Executives and a governor
of Montréals Jewish General Hospital. |
BOARD & COMMITTEE ATTENDANCE DURING 2014 |
|
REGULAR |
SPECIAL |
TOTAL |
|
|
TOTAL BOARD & COMMITTEE ATTENDANCE |
|
Board |
6/6 |
4/5 |
10/11 |
|
|
|
|
Audit Committee |
4/5 |
- |
4/5 |
|
|
89% |
|
Governance Committee |
1/1 |
1/1 |
2/2 |
|
|
|
|
OTHER PUBLIC BOARD DIRECTORSHIPS |
|
PRESENT BOARDS |
|
|
PAST BOARDS (LAST FIVE YEARS) |
|
Cineplex Inc. |
2010 present |
|
|
Astral Media Inc. |
1973 2013 |
OWNERSHIP AND TOTAL VALUE OF EQUITY |
|
MARCH 6, 2014 |
|
|
MARCH 5, 2015 |
|
BCE Common Shares |
- |
|
|
BCE Common Shares |
10,000 |
BCE DSUs |
1,749 |
|
|
BCE DSUs |
5,727 |
Value ($) |
84,407 |
|
|
Value ($) |
866,558 |
SHARE OWNERSHIP REQUIREMENTS -
TARGET DATE TO MEET |
Five-Year Target |
Met (152%) |
|
|
Ten-Year Target |
April 1, 2024 (65%) |
|
|
|
CORPORATE DIRECTOR
Since September 2014
Age - 58
Status - Independent
Joined Board -
November 2014
Areas of Expertise
CEO/Senior
Management
Investment Banking/Mergers & Acquisitions
Risk Management
2014 Annual Meeting
Votes in favour: N/A |
|
Mr. Nixon is a corporate director and from August
2001 to August 2014 was President and CEO of Royal Bank of Canada (a
chartered bank). He first joined RBC Dominion Securities Inc. (an
investment banking firm) in 1979, where he held a number of operating
positions, serving as CEO from December 1999 to April 2001. Mr. Nixon is
Chair of MaRS, a Toronto-based network of partners that helps
entrepreneurs launch and grow innovative companies. He also chairs the
Queens University Capital Campaign. In 2012, he chaired the Ontario
Premiers Jobs and Prosperity Council. Mr. Nixon earned a Bachelor of
Commerce (Honours) degree from Queens University and holds Honorary
Doctorates of Laws from Queens University and Dalhousie University. He
is a member of the Order of Canada and the Order of Ontario. |
BOARD & COMMITTEE ATTENDANCE DURING 2014 |
|
REGULAR |
SPECIAL |
TOTAL |
|
|
TOTAL BOARD & COMMITTEE ATTENDANCE |
|
Board |
2/2 |
2/2 |
4/4 |
|
|
|
|
Compensation Committee |
- |
- |
- |
|
|
100% |
|
Governance Committee |
- |
- |
- |
|
|
|
|
OTHER PUBLIC BOARD DIRECTORSHIPS |
|
PRESENT BOARDS |
|
|
PAST BOARDS (LAST FIVE YEARS) |
|
George Weston Limited |
2014 present |
|
|
Royal Bank of Canada |
2001 2014 |
OWNERSHIP AND TOTAL VALUE OF EQUITY |
|
MARCH 6, 2014 |
|
|
MARCH 5, 2015 |
|
BCE Common Shares |
N/A |
|
|
BCE Common Shares |
20,000 |
BCE DSUs |
N/A |
|
|
BCE DSUs |
606 |
Value ($) |
N/A |
|
|
Value ($) |
1,135,391 |
SHARE OWNERSHIP REQUIREMENTS -
TARGET DATE TO MEET |
Five-Year Target |
Met (199%) |
|
|
Ten-Year Target |
November 4, 2024 (85%) |
|
|
BCE Inc.
2015 PROXY CIRCULAR
15 |
4 |
ABOUT THE
NOMINATED DIRECTORS |
|
|
|
|
CHAIR OF THE BOARD
BCE and Bell Canada
Since February 2009
CHARTERED
PROFESSIONAL
ACCOUNTANT
Age - 69
Status - Independent
Joined Board -
January 2003
Areas of Expertise
Accounting & Finance
CEO/Senior
Management
Risk Management
2014 Annual Meeting
Votes in favour: 98.29% |
|
Mr. ONeill has been Chair of BCE and Bell Canada
since February 2009. He held a number of positions at
PricewaterhouseCoopers (an accounting firm) and its related entities
until 2002, including CEO and Chair of PricewaterhouseCoopers
Consulting, COO of PricewaterhouseCoopers LLP, Global and CEO of
PricewaterhouseCoopers LLP, Canada. Mr. ONeill serves as Chair of St.
Michaels Hospital, where he has served on the Board since 2003. He is a
former Vice-Chair of the Board of Trustees of Queens University and is
a member of the Advisory Board of Queens University School of Business.
Mr. ONeill graduated from Queens University with a Bachelor of
Commerce and is a Chartered Professional Accountant and a Fellow of CPA
Ontario. He received an Honorary LLD from Queens University and is a
Fellow of the Institute of Corporate Directors. In September 2013, Mr.
ONeill received the ICAO Award of Outstanding Merit, the highest honour
from CPA Ontario. |
BOARD & COMMITTEE ATTENDANCE DURING 2014 |
|
REGULAR |
SPECIAL |
TOTAL |
|
|
TOTAL BOARD & COMMITTEE ATTENDANCE |
|
Board (Chair) |
6/6 |
5/5 |
11/11 |
|
|
100% |
|
OTHER PUBLIC BOARD DIRECTORSHIPS |
|
PRESENT BOARDS |
|
|
PAST BOARDS (LAST FIVE YEARS) |
|
Adecco S.A. |
2004 present |
|
|
|
|
Loblaw Companies Limited |
2003 present |
|
|
Nexen Inc. |
2002 2013 |
The Bank of Nova Scotia (Chair) |
2008 present |
|
|
|
|
OWNERSHIP AND TOTAL VALUE OF EQUITY |
|
MARCH 6, 2014 |
|
|
MARCH 5, 2015 |
|
BCE Common Shares |
2,745 |
|
|
BCE Common Shares |
2,883 |
BCE DSUs |
46,313 |
|
|
BCE DSUs |
57,466 |
Value ($) |
2,367,539 |
|
|
Value ($) |
3,325,230 |
SHARE OWNERSHIP REQUIREMENTS -
TARGET DATE TO MEET |
Five-Year Target |
Met (261%) |
|
|
Ten-Year Target |
Met (112%) |
|
|
|
CHAIR
Lenbrook Corporation
Since April 2002
Age - 61
Status - Independent
Joined Board - May 2011
Areas of Expertise
Government &
Regulatory Affairs
Technology
Telecommunications
2014 Annual Meeting
Votes in favour: 99.31% |
|
Mr. Simmonds has been Chair of Lenbrook Corporation
(a national distributor of electronics components and radio products)
since 2002, having been a founder and director of the company since
1977. He is a seasoned Canadian telecommunications executive who has
served in public company roles from 1994 to 2006. From 1985 until 2000,
he served as Chair of Clearnet Communications Inc., a Canadian wireless
competitor that launched two all-new digital mobile networks.
Internationally regarded as a leading wireless communications engineer
and mobile spectrum authority, Mr. Simmonds has played a key role in the
development of Canadas mobile spectrum policies for more than 30 years.
He is Chair of the Mobile and Personal Communications Committee of the
Radio Advisory Board of Canada, a body that provides unbiased and
technically expert advice to the federal Department of Industry, and is
a past Chair of the Canadian Wireless Telecommunications Association
(CWTA). A laureate and member of Canadas Telecommunications Hall of
Fame and recipient of the Engineering Medal for Entrepreneurship from
Professional Engineers Ontario, Mr. Simmonds earned his B.A.Sc. in
Engineering Science (Electrical) at the University of Toronto. In
October 2013, Mr. Simmonds became a Fellow of the Wireless World
Research Forum (an organization dedicated to long-term research in the
wireless industry) in recognition of his contribution to the industry. |
BOARD & COMMITTEE ATTENDANCE DURING 2014 |
|
REGULAR |
SPECIAL |
TOTAL |
|
|
TOTAL BOARD & COMMITTEE ATTENDANCE |
|
Board |
6/6 |
5/5 |
11/11 |
|
|
|
|
Audit Committee |
5/5 |
- |
5/5 |
|
|
100% |
|
Governance Committee |
4/4 |
- |
4/4 |
|
|
|
|
OTHER PUBLIC BOARD DIRECTORSHIPS |
|
PRESENT BOARDS |
|
|
PAST BOARDS (LAST FIVE YEARS) |
|
|
N/A |
|
|
N/A |
|
OWNERSHIP AND TOTAL VALUE OF EQUITY |
|
MARCH 6, 2014 |
|
|
MARCH 5, 2015 |
|
BCE Common Shares |
104,000 |
|
|
BCE Common Shares |
104,000 |
BCE DSUs |
11,554 |
|
|
BCE DSUs |
16,223 |
Value ($) |
5,576,636 |
|
|
Value ($) |
6,624,287 |
SHARE OWNERSHIP REQUIREMENTS -
TARGET DATE TO MEET |
Five-Year Target |
Met (1,162%) |
|
|
Ten-Year Target |
Met (498%) |
16
BCE Inc. 2015 PROXY CIRCULAR |
|
|
|
ABOUT THE
NOMINATED DIRECTORS |
4 |
|
|
|
CORPORATE DIRECTOR
Since September 2010
Age - 69
Status - Independent
Joined Board -
August 2010
Areas of Expertise
Government &
Regulatory Affairs
Media/Content
Telecommunications
2014 Annual Meeting
Votes in favour: 99.37% |
|
Ms. Taylor is a corporate director and a member of
the Trilateral Commission (a non-governmental international
organization). She served as Chair of the Federal Finance Ministers
Economic Advisory Council from December 2008 to January 2010 and
Minister of Finance for British Columbia from June 2005 to June 2008.
Ms. Taylor was also Senior Advisor for Borden Ladner Gervais LLP (a law
firm) until September 2010. Ms. Taylor is the former Chair of
CBC/Radio-Canada, former Chair of Canada Ports, a public affairs
broadcaster, Chancellor Emeritus of Simon Fraser University and Officer
of the Order of Canada. Ms. Taylor holds four honorary degrees and
earned her B.A. in English at University of Torontos Victoria College. |
BOARD & COMMITTEE ATTENDANCE DURING 2014 |
|
REGULAR |
SPECIAL |
TOTAL |
|
|
TOTAL BOARD & COMMITTEE ATTENDANCE |
|
Board |
6/6 |
5/5 |
11/11 |
|
|
|
|
Governance Committee |
4/4 |
- |
4/4 |
|
|
100% |
|
Pension Committee |
4/4 |
- |
4/4 |
|
|
|
|
OTHER PUBLIC BOARD DIRECTORSHIPS |
|
PRESENT BOARDS |
|
|
PAST BOARDS (LAST FIVE YEARS) |
|
|
N/A |
|
|
The Toronto Dominion Bank |
2009 2012 |
OWNERSHIP AND TOTAL VALUE OF EQUITY |
|
MARCH 6, 2014 |
|
|
MARCH 5, 2015 |
|
BCE Common Shares |
24,000 |
|
|
BCE Common Shares |
24,000 |
BCE DSUs |
8,000 |
|
|
BCE DSUs |
10,448 |
Value ($) |
1,544,320 |
|
|
Value ($) |
1,898,085 |
SHARE OWNERSHIP REQUIREMENTS -
TARGET DATE TO MEET |
Five-Year Target |
Met (333%) |
|
|
Ten-Year Target |
Met (143%) |
|
|
|
CORPORATE DIRECTOR
Since April 2008
CHARTERED
PROFESSIONAL
ACCOUNTANT
Age - 67
Status - Independent
Joined Board - May 2009
Areas of Expertise
Accounting & Finance
Investment Banking/Mergers & Acquisitions
Risk Management
2014 Annual Meeting
Votes in favour: 98.81% |
|
Mr. Weiss has been a corporate director since 2008.
He was a director and audit committee member of The Empire Life
Insurance Company until May 2014 and a director and audit committee
member of ING Bank of Canada until November 2012. He is a director and
past Chair of Soulpepper Theatre Company and past Chair of Toronto Rehab
Foundation. For over 40 years, until his retirement in 2008, Mr. Weiss
was with KPMG LLP (an accounting firm). He served as Managing Partner of
the Canadian Audit Practice, a member of KPMG Canadas Management
Committee, and a member of the International Global Audit Steering
Group. Mr. Weiss holds a Bachelor of Commerce degree from Carleton
University. He is a Chartered Professional Accountant and a Fellow of
CPA Ontario. |
BOARD & COMMITTEE ATTENDANCE DURING 2014 |
|
REGULAR |
SPECIAL |
TOTAL |
|
|
TOTAL BOARD & COMMITTEE ATTENDANCE |
|
Board |
6/6 |
5/5 |
11/11 |
|
|
|
|
Audit Committee (Chair) |
5/5 |
- |
5/5 |
|
|
100% |
|
Pension Committee |
4/4 |
- |
4/4 |
|
|
|
|
OTHER PUBLIC BOARD DIRECTORSHIPS |
|
PRESENT BOARDS |
|
|
PAST BOARDS (LAST FIVE YEARS) |
|
Choice Properties REIT |
2013 present |
|
|
N/A |
|
Torstar Corporation |
2009 present |
|
|
|
OWNERSHIP AND TOTAL VALUE OF EQUITY |
|
MARCH 6, 2014 |
|
|
MARCH 5, 2015 |
|
BCE Common Shares |
- |
|
|
BCE Common Shares |
- |
BCE DSUs |
24,829 |
|
|
BCE DSUs |
28,610 |
Value ($) |
1,198,248 |
|
|
Value ($) |
1,576,411 |
SHARE OWNERSHIP REQUIREMENTS -
TARGET DATE TO MEET |
Five-Year Target |
Met (277%) |
|
|
Ten-Year Target |
Met (119%) |
|
|
BCE Inc.
2015 PROXY CIRCULAR
17 |
5 |
DIRECTOR
COMPENSATION |
|
This section provides information pertaining to the
compensation, share ownership and share ownership requirements of our
non-management directors.
Our compensation program for non-management
directors has the following objectives:
-
to ensure that the Corporation attracts and retains
highly qualified, committed and talented members of the Board with an extensive
and relevant breadth of experience
-
to align the interests of directors with those of
our shareholders.
The Board sets the compensation of non-management
directors based on recommendations from the Governance Committee.
The Governance Committee regularly reviews the
compensation of non-management directors and recommends to the Board such
adjustments as it considers appropriate and necessary to recognize the workload,
time commitment and responsibility of the Board and committee members and to
remain competitive with director compensation trends in Canada. Any director who
is also an employee of the Corporation or any of its subsidiaries does not
receive any compensation as a director.
Consistent with the risks and responsibilities of being an effective
director, our aim is to ensure that our Board membership is of the
highest quality and has a sufficient range of skills, expertise and
experience |
The comparator group used to benchmark the
compensation of non-management directors and the share ownership requirements
for 2014 is as follows:
COMPANY NAME |
PRIMARY INDUSTRY |
Bank of Montreal |
Diversified Banks |
Barrick Gold Corporation |
Mining |
Brookfield Asset Management Inc. |
Asset Management and Custody Banks |
Canadian Imperial Bank of Commerce |
Diversified Banks |
Canadian National Railway Company |
Railroads |
Canadian Natural Resources Limited |
Oil and Gas Exploration and Production |
Cenovus Energy Inc. |
Integrated Oil and Gas |
Enbridge Inc. |
Oil and Gas Storage and Transportation |
Manulife Financial Corporation |
Life and Health Insurance |
Power Corporation of Canada |
Life and Health Insurance |
Rogers Communications Inc. |
Integrated Communications Services |
Royal Bank of Canada |
Diversified Banks |
Suncor Energy Inc. |
Integrated Oil and Gas |
Sun Life Financial Inc. |
Life and Health Insurance |
Telus Corporation |
Integrated Communications Services |
The Bank of Nova Scotia |
Diversified Banks |
The Toronto-Dominion Bank |
Diversified Banks |
TransCanada Corporation |
Oil and Gas Storage and Transportation |
18
BCE Inc. 2015 PROXY CIRCULAR |
|
|
|
DIRECTOR
COMPENSATION |
5 |
The comparator group is composed of Canadian
companies with a scope, complexity and size comparable to BCE, taking into
account certain criteria, including market capitalization and revenue. The
following table provides a breakdown of the comparator group by industry.
Of the companies in the non-management directors
compensation comparator group, approximately 56% are also included in the
executives compensation comparator group. Both comparator groups represent a
sample of large Canadian companies. In developing the executives compensation
comparator group, efforts were made to ensure that there was approximately equal
representation of industries in the group, which was not a selection criteria
when developing the non-management directors compensation comparator group.
Non-management directors receive an all-inclusive
annual flat fee (in lieu of retainers and attendance fees), in line with market
best practices.
The following table shows the compensation levels
for non-management directors:
COMPENSATION ($)(1) |
LEVEL |
190,000 |
Directors who serve on one committee of the Board |
205,000 |
Directors who serve on two or more committees of
the Board |
225,000 |
Chair of the Governance Committee and Chair of the
Pension Committee |
250,000 |
Chair of the Audit Committee and Chair of the
Compensation Committee |
425,000 |
Chair of the Board |
(1) |
Non-management directors do not receive additional retainers or
attendance fees in respect of their service as directors and as members
of any of the Boards standing committees. Directors are, however,
reimbursed for transportation and other expenses incurred for attendance
at Board and committee meetings. |
5.3 Share ownership
requirements |
The Board establishes guidelines for the share
ownership requirement of non-management directors. The following share ownership
requirements apply to non-management directors, to be held either in BCE common
shares and/or DSUs.
OWNERSHIP REQUIREMENT FOR DIRECTORS |
VALUE |
TIME TO MEET REQUIREMENT |
Initial requirement of three times the base annual
flat fee |
$570,000 |
Within five years of being appointed to the Board |
Additional requirement of seven times the base
annual flat fee |
$1,330,000 |
Within ten years of being appointed to the Board |
SPECIFIC OWNERSHIP REQUIREMENT FOR THE CHAIR OF THE
BOARD |
VALUE |
TIME TO MEET REQUIREMENT |
Initial requirement of three times the Chairs
annual flat fee |
$1,275,000 |
Within five years of being appointed Chair of
the Board |
Additional requirement of seven times the Chairs
annual flat fee |
$2,975,000 |
Within ten years of being appointed Chair of
the Board |
|
|
BCE Inc.
2015 PROXY CIRCULAR
19 |
5 |
DIRECTOR
COMPENSATION |
|
The following table lists the number of BCE common
shares and DSUs of BCE held by each current non-management director as of March
5, 2015, with the corresponding dollar value as of such date, and highlights
where each non-management director stands in terms of fulfillment of the share
ownership guidelines as of that date:
|
|
|
|
|
|
5-YEAR SHARE |
TARGET
DATE TO MEET
5-YEAR REQUIREMENT |
10-YEAR SHARE |
TARGET
DATE TO MEET
10-YEAR REQUIREMENT |
|
NUMBER OF |
|
TOTAL NUMBER |
|
|
OWNERSHIP |
OWNERSHIP |
|
COMMON |
NUMBER |
OF COMMON |
TOTAL VALUE |
(1) |
REQUIREMENT |
REQUIREMENT |
NAME |
SHARES |
OF DSUs |
SHARES & DSUs |
($) |
|
($) |
($) |
B.K. Allen |
22,500 |
14,160 |
36,660 |
2,019,966 |
|
570,000 |
Met (354%) |
1,330,000 |
Met (152%) |
R.A. Brenneman |
123,804 |
54,107 |
177,911 |
9,802,896 |
|
570,000 |
Met (1,720%) |
1,330,000 |
Met (737%) |
S. Brochu |
1,250 |
22,589 |
23,839 |
1,313,529 |
|
570,000 |
Met (230%) |
1,330,000 |
April 1, 2024 |
R.E. Brown |
31,889 |
14,298 |
46,187 |
2,544,904 |
|
570,000 |
Met (446%) |
1,330,000 |
Met (191%) |
D.F. Denison |
|
9,683 |
9,683 |
533,533 |
|
570,000 |
April 1, 2019 |
1,330,000 |
April 1, 2024 |
R.P. Dexter(2) |
7,526 |
17,544 |
25,070 |
1,381,357 |
|
570,000 |
Met (242%) |
1,330,000 |
Met (104%) |
I. Greenberg |
10,000 |
5,727 |
15,727 |
866,558 |
|
570,000 |
Met (152%) |
1,330,000 |
April 1, 2024 |
G.M. Nixon(3) |
20,000 |
606 |
20,606 |
1,135,391 |
|
570,000 |
Met (199%) |
1,330,000 |
November 4, 2024 |
T.C. ONeill |
2,883 |
57,466 |
60,349 |
3,325,230 |
|
1,275,000 |
Met (261%) |
2,975,000 |
Met (112%) |
R.C. Simmonds |
104,000 |
16,223 |
120,223 |
6,624,287 |
|
570,000 |
Met (1,162%) |
1,330,000 |
Met (498%) |
C. Taylor |
24,000 |
10,448 |
34,448 |
1,898,085 |
|
570,000 |
Met (333%) |
1,330,000 |
Met (143%) |
P.R. Weiss |
|
28,610 |
28,610 |
1,576,411 |
|
570,000 |
Met (277%) |
1,330,000 |
Met (119%) |
(1) |
The Total Value is determined by multiplying the number of common shares and
DSUs of BCE held by each director as of March 5, 2015, by the closing price of
BCEs common shares on the Toronto Stock Exchange as of the close of business on
such date, being $55.10. |
(2) |
Mr. Dexter was appointed to the Board on November 1, 2014 and to the Audit
and Pension Committees on November 6, 2014. |
(3) |
Mr. Nixon was appointed to the Board on November 4, 2014 and to the
Compensation and Governance Committees on November 6, 2014. |
In 2014, the share ownership requirements were increased
significantly, from three times to seven times the annual base fee,
placing BCE at the top of the comparator group |
Current directors who do not meet the increased
share ownership requirements that became effective on April 1, 2014 have five
years from that date to meet the initial requirement, and ten years from that
date to meet the additional requirement. Until the initial minimum share
ownership level is attained, 100% of the compensation is paid mandatorily in the
form of DSUs. Once a director attains the initial minimum share ownership level,
at least 50% of the compensation is paid mandatorily in DSUs, with the remaining
portion to be paid in cash or DSUs, at the discretion of the director.
5.4 Directors share unit
plan |
Under the share unit plan for non-employee directors
(1997) (Directors Share Unit Plan), each non-management director receives at
least 50% of his or her annual fees in DSUs and may elect to receive his or her
remaining annual fees in the form of DSUs. One DSU is equal in value to one BCE
common share.
Each director has an account where DSUs are credited
(at the end of each quarter) and held until the director leaves the Board. The
number of DSUs credited to each directors account is calculated by dividing the
amount of the quarterly fee payment by the common share price on the day the
credit is made. DSUs vest at the time of grant.
Holders of DSUs are credited additional units that
are equal to the dividends declared on the Corporations common shares.
Additional DSUs are credited to each non-management directors account on each
dividend payment date. The number of DSUs is calculated using the same rate as
the dividends paid on the common shares.
When a director leaves the Board, the Corporation
buys the same number of BCE common shares on the open market as the number of
DSUs the director holds in the Directors Share Unit Plan, after deducting
appropriate taxes. These shares are then delivered to the former director. All
administration costs as well as any brokerage fees associated with the purchase
and registration of common shares are paid by BCE.
Directors are required to be paid entirely in the form of DSUs until they
attain their initial share ownership requirement |
5.5 Compensation of
directors of subsidiary boards of directors |
The directors annual flat fee also compensates
non-management directors for their services as directors of subsidiaries whose
common shares or units are not publicly traded, including Bell Canada. The
directors of the Corporation who sit on boards of directors of subsidiaries
whose common shares or units are publicly traded may receive compensation from
such publicly-traded subsidiaries.
20
BCE Inc. 2015 PROXY CIRCULAR |
|
|
|
DIRECTOR
COMPENSATION |
5 |
The following table provides details of the
compensation provided to the non-management directors of the Corporation who
served as directors during the year ended on December 31, 2014.
|
|
|
|
|
|
|
|
|
ALLOCATION OF TOTAL
COMPENSATION |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ALL OTHER |
|
|
|
|
|
|
|
|
|
|
FEES EARNED |
|
COMPENSATION |
|
TOTAL |
|
IN CASH |
|
IN DSUs |
|
NAME |
|
CURRENT COMMITTEE MEMBERSHIPS |
($) |
(3) |
($) |
|
COMPENSATION |
|
($) |
|
($) |
|
B.K. Allen |
|
Compensation, Governance |
197,500 |
|
|
|
197,500 |
|
98,750 |
|
98,750 |
|
R.A. Brenneman |
|
Compensation (Chair), Pension |
243,750 |
|
|
|
243,750 |
|
121,875 |
|
121,875 |
|
S. Brochu |
|
Audit, Governance |
197,500 |
|
|
|
197,500 |
|
|
|
197,500 |
|
R.E. Brown |
|
Compensation, Governance (Chair) |
218,750 |
|
|
|
218,750 |
|
109,375 |
|
109,375 |
|
D.F. Denison |
|
Audit, Pension (Chair) |
218,750 |
|
|
|
218,750 |
|
|
|
218,750 |
|
R.P. Dexter(1) |
|
Audit, Pension |
33,981 |
|
|
|
33,981 |
|
|
|
33,981 |
|
I. Greenberg |
|
Audit, Compensation |
188,492 |
|
|
|
188,492 |
|
|
|
188,492 |
|
G.M. Nixon(2) |
|
Compensation, Governance |
32,310 |
|
|
|
32,310 |
|
|
|
32,310 |
|
T.C. ONeill |
|
Chair of the Board |
425,000 |
|
|
|
425,000 |
|
|
|
425,000 |
|
R.C. Simmonds |
|
Audit, Governance |
197,500 |
|
|
|
197,500 |
|
|
|
197,500 |
|
C. Taylor |
|
Governance, Pension |
197,500 |
|
|
|
197,500 |
|
98,750 |
|
98,750 |
|
P.R. Weiss |
|
Audit (Chair), Pension |
243,750 |
|
|
|
243,750 |
|
121,875 |
|
121,875 |
|
Retired Directors |
|
|
|
|
|
|
|
|
|
|
|
|
A. Bérard |
|
N/A |
96,277 |
|
|
|
96,277 |
|
|
|
96,277 |
|
A.S. Fell |
|
N/A |
58,791 |
|
|
|
58,791 |
|
|
|
58,791 |
|
E.C. Lumley |
|
N/A |
58,791 |
|
|
|
58,791 |
|
29,396 |
|
29,395 |
|
J. Prentice |
|
N/A |
66,099 |
|
|
|
66,099 |
|
|
|
66,099 |
|
(1) |
Mr. Dexter
was appointed to the Board on November 1, 2014 and to the Audit and
Pension Committees on November 6, 2014. |
(2) |
Mr. Nixon
was appointed to the Board on November 4, 2014 and to the Compensation
and Governance Committees on November 6, 2014. |
(3) |
The amount
of fees paid takes into account the changes in committee memberships
during the year 2014. |
The following table includes details of outstanding
DSUs for non-management directors of the Corporation who served on the Board
during the year ended on December 31, 2014, including DSUs granted during 2014.
|
SHARE-BASED AWARDS (DSUs) VALUE VESTED DURING THE
YEAR |
|
OUSTANDING |
|
|
|
|
|
|
|
|
|
OUSTANDING |
|
|
DSUs AS OF |
|
|
|
|
|
DIVIDEND-LIKE CREDIT IN THE FORM OF
DSUs AWARDED IN 2014 |
|
DSUs AS OF |
|
|
DEC. 31, 2013 |
|
DIRECTORS FEES PAID IN DSUs IN 2014 |
|
|
DEC. 31, 2014 |
|
NAME |
(# OF DSUs) |
|
(# OF DSUs) |
|
($) |
|
(# OF DSUs) |
|
($) |
|
(# OF DSUs) |
|
B.K. Allen |
11,397 |
|
2,005 |
|
98,750 |
|
607 |
|
28,898 |
|
14,008 |
|
R.A. Brenneman |
48,497 |
|
2,475 |
|
121,875 |
|
2,543 |
|
121,139 |
|
53,515 |
|
S. Brochu |
17,408 |
|
4,010 |
|
197,500 |
|
932 |
|
44,428 |
|
22,350 |
|
R.E. Brown |
11,320 |
|
2,221 |
|
109,375 |
|
604 |
|
28,781 |
|
14,145 |
|
D.F. Denison |
4,863 |
|
4,442 |
|
218,750 |
|
282 |
|
13,436 |
|
9,588 |
|
R.P. Dexter(1) |
|
|
638 |
|
33,981 |
|
|
|
|
|
17,358 |
(2) |
I. Greenberg |
1,739 |
|
3,822 |
|
188,492 |
|
114 |
|
5,439 |
|
5,675 |
|
G.M. Nixon(3) |
|
|
606 |
|
32,310 |
|
|
|
|
|
606 |
|
T.C. ONeill |
45,769 |
|
8,639 |
|
425,000 |
|
2,443 |
|
116,420 |
|
56,852 |
|
R.C. Simmonds |
11,424 |
|
4,010 |
|
197,500 |
|
621 |
|
29,575 |
|
16,054 |
|
C. Taylor |
7,908 |
|
2,005 |
|
98,750 |
|
425 |
|
20,238 |
|
10,337 |
|
P.R. Weiss |
24,531 |
|
2,475 |
|
121,875 |
|
1,294 |
|
61,651 |
|
28,300 |
|
Retired Directors |
|
|
|
|
|
|
|
|
|
|
|
|
A. Bérard |
61,707 |
|
2,001 |
|
96,277 |
|
3,241 |
|
154,402 |
|
66,949 |
|
A.S. Fell |
61,708 |
|
1,227 |
|
58,791 |
|
3,236 |
|
154,167 |
|
66,171 |
|
E.C. Lumley |
44,484 |
|
614 |
|
29,395 |
|
2,328 |
|
110,917 |
|
47,426 |
|
J. Prentice |
9,543 |
|
1,365 |
|
66,099 |
|
231 |
|
11,012 |
|
|
|
(1) |
Mr. Dexter was appointed to the Board on
November 1, 2014 and to the Audit and Pension Committees on November 6, 2014. |
(2) |
Following completion of the acquisition of
Bell Aliant Inc. by BCE, Mr. Dexter elected to convert his DSUs of Bell Aliant
Inc. into DSUs of the Corporation, with appropriate adjustments. |
(3) |
Mr. Nixon was appointed to the Board on
November 4, 2014 and to the Compensation and Governance Committees on November
6, 2014. |
|
|
BCE Inc.
2015 PROXY CIRCULAR
21 |
6 |
CORPORATE
GOVERNANCE PRACTICES |
|
6 |
CORPORATE GOVERNANCE PRACTICES |
This section provides information pertaining to our
Board, the committees of our Board, our shareholder engagement and our ethical
values and policies.
BCEs Board and management believe that strong corporate governance practices
contribute to superior results in creating and maintaining shareholder value.
That is why we continually seek to strengthen our leadership in corporate
governance and ethical business conduct by adopting best practices and providing
full transparency and accountability to our stakeholders |
In 2013, the BCE Board was recognized by the
Canadian Coalition for Good Governance, receiving the organizations Gavel Award
for best corporate governance disclosure, which underscores the importance of
effective communications between corporations and their shareholders. The
Canadian Society of Corporate Secretaries also named BCE the winner of its
first-ever award for best overall corporate governance, recognizing our long
history of best practices in building and sustaining shareholder and stakeholder
value. In addition, BCE received the Best Overall Corporate Governance Award
International at the Corporate Secretary Corporate Governance Awards in
New York. These achievements recognize the expertise and guidance provided by
the BCE Board, and the hard work and dedication of the BCE team in ensuring
rigorous governance over our Corporations operations.
BCEs common shares are listed on the Toronto Stock
Exchange and the New York Stock Exchange (NYSE). Our practices described in this
section comply with the Canadian Securities Administrators (CSA) corporate
governance guidelines as well as the CSAs rules relating to audit committees
and certification of financial information. Since the Corporation has securities
registered in the United States, we are subject to, and comply with, the
provisions of the Sarbanes-Oxley Act and related rules and regulations of
the U.S. Securities and Exchange Commission (SEC). In addition, since the
Corporations common shares are listed on the NYSE, we follow certain NYSE
corporate governance rules applicable to foreign private issuers such as BCE. We
comply with such mandatory NYSE governance rules and voluntarily comply in all
material respects with all other NYSE governance rules, except as summarized
under Governance Practices in the governance section of our website at
BCE.ca, under the heading Difference between BCE practices and NYSE.
The Board has overall responsibility for the
supervision of the management of BCEs business and affairs. In exercising this
responsibility, the Board must act in accordance with a number of rules and
standards, including:
-
the Canada Business Corporations Act
-
the Bell Canada Act
-
other laws that apply to telecommunications and
broadcasting companies
-
laws of general application
-
BCEs articles and by-laws
-
BCEs administrative resolution and the written
charters of the Board and each of its committees
-
BCEs Code of Business Conduct, Complaint Procedures
for Accounting and Auditing Matters and other internal policies.
At each regular meeting, and special meeting when required, time is set aside
for the directors to meet without management, that is, with only the independent
directors |
In 2014, the Board held six regular meetings and
five special meetings. During 2014, each private session of the Board was
chaired by Mr. T.C. ONeill, Chair of the Board of BCE.
22
BCE Inc. 2015 PROXY CIRCULAR |
|
|
|
CORPORATE
GOVERNANCE PRACTICES |
6 |
Role of the Board of directors |
The Board is responsible for the supervision of the
management of the business and affairs of the Corporation. In furtherance of its
purpose, the Board assumes the duties and responsibilities described in its
written charter, which is reviewed annually by the Governance Committee and has
been approved by the Board. The Boards charter is incorporated by reference
into this circular and is available on our website at
BCE.ca, on SEDAR at sedar.com and on EDGAR
at sec.gov. In addition, shareholders may promptly
obtain a free copy of the Boards charter by contacting the Corporate
Secretarys Office at the coordinates set out in section 12.4.
The Board fulfills its duties and responsibilities
directly and through four standing committees. Highlighted below is a discussion
of some key aspects of the role of the Board, notably with respect to strategic
planning, succession planning and risk oversight.
STRATEGIC PLANNING
Each May, our executive leadership team reviews a
current five-year strategic view for each business unit, enabling a company-wide
perspective on key opportunities and risks, and providing the foundation for our
long-term capital planning. Each December, the Board holds a day-long session to
review and approve our strategic plan which takes into account, among other
things, the opportunities and risks of the business units for the upcoming year.
At that meeting, the Board reviews and approves the corporate financial
objectives and operating plan of each business unit, including the significant
capital and operating allocations. As well, the Board frequently discusses
aspects of the strategy and frequently reviews and assesses the implementation
of our strategic imperatives.
In addition to reviewing the strategic aspects of key corporate initiatives,
the Board each year reviews the strategic plan for the Corporation and each
business unit |
SUCCESSION PLANNING
A critical responsibility of the Compensation
Committee is to ensure that a comprehensive succession plan is in place for the
Corporations most senior executive leaders. To achieve this, the Compensation
Committee meets annually with the President and CEO to review and update the
succession plan for all executive officers, including the President and CEO
position.
The plan identifies potential successors for each
executive and highlights any personal development experiences required for each
candidate to be fully prepared to take on the position. In addition, if
appropriate, the plan identifies any candidates who could assume critical
leadership roles in the short term should unexpected events leave such roles
vacant earlier than expected.
Effective succession planning has long been a focus of the Board
The
Compensation Committee reviews the succession planning process and results for
executive management annually |
The executive succession plan is fully integrated
with the Corporations overall succession planning process, which covers all key
management positions and ensures a strong pipeline of talent is being developed
at all levels in the organization. As such, the plan that is presented to the
Compensation Committee is the culmination of an extensive process performed
within each business unit and function and integrated at the cross-company
level. This includes the identification of key talent, the roles they may be
able to assume in the future, and their development plan to prepare for these
roles. This may include development moves to other positions, internal or
external courses, and on-the-job mentoring. If no strong internal succession
candidates are identified, an external search may be launched. Twice a year, all
members of the senior management team are reviewed by the President and CEO and
his direct reports in order to provide an integrated and balanced view of talent
across the Corporation, and to ensure development plans are on track.
In addition to the regular annual review, key
executive talent and succession plans are discussed by the Compensation
Committee throughout the year, including, for example, as part of the
performance reviews used to determine executive compensation.
RISK OVERSIGHT
At BCE, the full Board is entrusted with the
responsibility for identifying and overseeing the principal risks to which our
business is exposed and seeking to ensure there are processes in place to
effectively identify, monitor and manage them. These processes seek to mitigate
rather than eliminate risk. A risk is the possibility that an event might happen
in the future that could have a negative effect on our financial position,
financial performance, cash flows, business or reputation. The Board delegates
responsibility for the execution of certain elements of the risk oversight
program to Board committees in order to ensure that they are treated with
appropriate expertise, attention and diligence, with reporting to the Board in
the ordinary course. The Board retains overall responsibility for, as well as
direct oversight of other risks, such as those relating to our regulatory
environment, competitive environment, complexity, service and operational
effectiveness, strategic network evolution, IT, strategy development and
business integration.
|
|
BCE Inc.
2015 PROXY CIRCULAR
23 |
6 |
CORPORATE
GOVERNANCE PRACTICES |
|
Risk information is reviewed by the Board or the
relevant committee throughout the year, and business leaders present regular
updates on the execution of business strategies, risks and mitigation
activities.
-
the Audit Committee is responsible for overseeing
financial reporting and disclosure as well as overseeing that appropriate risk
management processes are in place across the organization.
As part of its risk management activities, the Audit Committee reviews the
organizations risk reports and ensures that responsibility for each principal
risk is formally assigned to a specific committee or the full Board, as
appropriate. The Audit Committee also regularly considers risks relating to
financial reporting, legal proceedings, physical security, performance of
critical infrastructure, information security, privacy and records management,
business continuity and the environment
-
the Compensation Committee oversees risks relating
to compensation, succession planning and health and safety practices
-
the Pension Committee has oversight responsibility
for risks associated with the pension fund
-
the Governance Committee assists the Board in
developing and implementing BCEs corporate governance guidelines and
determining the composition of the Board and its committees. The Governance
Committee also oversees matters such as the organizations policies concerning
business conduct, ethics and public disclosure of material information.
We have robust processes in place to enable the Board to identify and monitor
the significant risks to which our business is exposed |
RISK MANAGEMENT CULTURE
There is a strong culture of risk management at BCE
that is actively promoted by the Board and the President and CEO at all levels
within the organization. It has become a part of how the Corporation operates on
a day-to-day basis and is woven into the structure and operating principles
guiding the implementation of the organizations strategic imperatives.
The President and CEO, selected by the Board, has
set his strategic focus through the establishment of six strategic imperatives
and focuses risk management around the factors that could impact the achievement
of those strategic imperatives. While the constant state of change in the
economic environment and the industry creates challenges to be managed, the
clarity around strategic objectives, performance expectations, risk management
and integrity in execution ensures discipline and balance in all aspects of our
business.
RISK MANAGEMENT FRAMEWORK
While the Board is responsible for Bell Canadas
risk oversight program, operational business units are central to the proactive
identification and management of risk. They are supported by a range of
corporate support functions that provide independent expertise to reinforce
implementation of risk management approaches in collaboration with the
operational business units. The Internal Audit function provides a further
element of expertise and assurance, working to provide insight and support to
the operational business units and corporate support functions while also
providing the Audit Committee with an independent perspective on the state of
risk and control within the organization. Collectively, these elements can be
thought of as a Three Lines of Defence approach to risk
management that is aligned with industry best practices and is endorsed by the
Institute of Internal Auditors.
First Line of Defence Operational Management
The first line refers to management within Bell
Canadas operational business segments (Wireless, Wireline, Media) (Bell), who
are expected to understand their operations in great detail and the financial
results that underpin them. There are regular reviews of operating performance
involving the organizations executive and senior management. The discipline and
precision associated with this process, coupled with the alignment and focus
around performance goals, create a high degree of accountability and
transparency, in support of Bells risk management practices.
As risks emerge in the business environment they are
discussed in a number of regular forums to share details and explore their
relevance across the organization. Executive and senior management is integral
to these activities in driving the identification of risks, assessment,
mitigation and reporting at all levels. Formal risk reporting occurs through
strategic planning sessions, management presentations to the Board and formal
Enterprise Risk Reporting, which is shared with the Board and the Audit
Committee during the year.
Management is also responsible for maintaining
effective internal controls and for executing risk and control procedures on a
day-today basis. Each operational business unit develops its own operating
controls and procedures that fit the needs of its unique environment.
Second Line of Defence Corporate Support Functions
Bell is a very large enterprise with approximately
51,000 employees, multiple business units and a diverse portfolio of risks that
is constantly evolving based on internal and external factors. In a large
organization, it is common to manage certain functions centrally for efficiency,
scale and consistency. While the first line of defence is often central to
identification and management of business risks, in many instances, operational
management works both collaboratively with, and also relies on, the corporate
functions that make up the second line of defence for support in these areas.
These corporate functions include Finance, Corporate Security and Corporate Risk
Management, as well as others such as Legal and Regulatory, Corporate
Responsibility, Real Estate and Procurement.
24
BCE Inc. 2015 PROXY CIRCULAR |
|
|
|
CORPORATE
GOVERNANCE PRACTICES |
6 |
-
Finance Function: Bells Finance function plays a
pivotal role in seeking to identify, assess and manage risks through a number of
different activities, which include financial performance management, external
reporting, capital management and oversight and execution practices related to
the United States
Sarbanes Oxley Act of 2002
-
Corporate Security Function: this function is
responsible for all aspects of security, which requires a deep understanding of
the business, the risk environment and the external stakeholder environment.
Based on this understanding, Corporate Security sets the standards of
performance required across the organization through security policy definitions
and monitors the organizations performance against these policies. In high and
emerging risk areas such as cyber-security, Corporate Security leverages its
experience and competence and, through collaboration with the operational
business units, develops strategies intended to mitigate the organizations
risks
-
Corporate Risk Management Function: this function
works across the company to gather information and report on the organizations
assessment of its principal risks and the related exposures. Annually, senior
management participates in a risk survey that provides an important reference
point in the overall risk assessment process.
In addition to the activities described above, the
second line of defence is also critical in building and operating the oversight
mechanisms that bring focus to relevant areas of risk and reinforce the bridges between the first and second lines of
defence, thereby seeking to ensure that there is a clear understanding of
emerging risks, their relevance to the organization and the proposed mitigation
plans. To further coordinate efforts between the first and second lines of
defense, Bell has established a Security, Environmental, Health and Safety
Committee (SEHS). A significant number of Bells most senior leaders are members
of this committee, whose purpose is to oversee Bells strategic security,
environmental, health & safety risks and opportunities. This cross functional
committee seeks to ensure that relevant risks are adequately recognized and
mitigation activities are well integrated and aligned across the organization
and are supported with sufficient resources.
Third Line of Defence Internal Audit Function
Internal Audit is a part of the overall management
information and control system and has the responsibility to act as an
independent appraisal function. Its purpose is to provide the Audit Committee
and management with objective evaluations of the companys risk and control
environment, to support management in delivering against Bells strategic
imperatives and to maintain an audit presence throughout Bell and its
subsidiaries.
For a detailed explanation of the material risks
applicable to BCE and its affiliates, see section 8 entitled Regulatory
Environment and section 9 entitled Business Risks in BCEs
Managements Discussion and Analysis dated March 5, 2015 included in BCEs 2014
Annual Report, available on SEDAR at sedar.com, on
EDGAR at sec.gov and on BCEs website at
BCE.ca.
Committees of the Board of directors |
There are four standing committees of the Board: the
Audit Committee, the Compensation Committee, the Governance Committee and the
Pension Committee.
It is BCEs policy that each of the Audit Committee, the Compensation
Committee and the Governance Committee must be comprised solely of independent
directors |
The Board has concluded that all of the directors
who served as members of the Audit Committee, the Compensation Committee and the
Governance Committee during 2014 are independent under our director independence
standards, which are consistent with the director independence requirements of
the CSAs corporate governance rules and guidelines. In addition, all members of
the Audit Committee met the more stringent Audit Committee independence tests
under National Instrument 52-110 Audit Committees and the NYSE
governance rules. During 2014 none of the members of the Audit Committee
directly or indirectly accepted any consulting, advisory or other compensatory
fee from BCE, other than ordinary director fees.
The charter of each Board committee is reviewed
annually by the Governance Committee and can be found in the governance section
of our website at BCE.ca. The Audit Committee
charter is also attached as Schedule 2 to BCEs annual information form for the
year ended December 31, 2014 (which you can access on our website at
BCE.ca, SEDAR at sedar.com and EDGAR at
sec.gov).
As well, the position description of the committee
chairs is detailed in the corresponding committee charter. At each regularly
scheduled Board meeting, each committee of the Board, through the committee
Chair, provides a report to the Board on its activities.
|
NUMBER OF |
|
|
|
MEETINGS |
|
|
COMMITTEE |
HELD IN 2014 |
MEMBERS AT DECEMBER 31, 2014 |
INDEPENDENT |
Audit |
5 |
P.R. Weiss (Chair) |
YES |
|
|
S. Brochu |
YES |
|
|
D.F. Denison |
YES |
|
|
R.P. Dexter |
YES |
|
|
I. Greenberg |
YES |
|
|
R.C. Simmonds |
YES |
Compensation |
5 |
R.A. Brenneman (Chair) |
YES |
|
|
B.K. Allen |
YES |
|
|
R.E. Brown |
YES |
|
|
I. Greenberg |
YES |
|
|
G.M. Nixon |
YES |
Governance |
4 |
R.E. Brown (Chair) |
YES |
|
|
B.K. Allen |
YES |
|
|
S. Brochu |
YES |
|
|
G.M. Nixon |
YES |
|
|
R.C. Simmonds |
YES |
|
|
C. Taylor |
YES |
Pension |
4 |
D.F. Denison (Chair) |
YES |
|
|
R.A. Brenneman |
YES |
|
|
R.P. Dexter |
YES |
|
|
C. Taylor |
YES |
|
|
P.R. Weiss |
YES |
|
|
BCE Inc.
2015 PROXY CIRCULAR
25 |
6 |
CORPORATE
GOVERNANCE PRACTICES |
|
AUDIT COMMITTEE
The purpose of the Audit Committee is to assist the
Board in its oversight of:
-
the integrity of BCEs financial statements and
related information
-
BCEs compliance with applicable legal and
regulatory requirements
-
the independence, qualifications and appointment of
the external auditors
-
the performance of both the external and internal
auditors
-
managements responsibility for assessing and
reporting on the effectiveness of internal controls
-
the Corporations enterprise risk management
processes.
Please refer to section 7.1 entitled Audit Committee report for a complete description
of the committee. |
COMPENSATION COMMITTEE
The purpose of the Compensation Committee is to
assist the Board in its oversight responsibilities related to:
-
compensation, nomination, evaluation and succession
of officers and other management personnel
-
BCEs health and safety policies and practices.
Please refer to section 7.4 entitled Compensation Committee report for a complete
description of the committee and for a description of fees paid to external
compensation advisors in 2014. |
GOVERNANCE COMMITTEE
The purpose of the Governance Committee is to assist
the Board in:
-
developing and implementing BCEs corporate
governance guidelines
-
identifying individuals qualified to become members
of the Board
-
determining the composition of the Board and its
committees
-
determining the directors remuneration for Board
and committee service
-
developing and overseeing a process to assess the
Chair of the Board, the Board, committees of the Board, chairs of committees,
and individual directors
-
reviewing, and recommending for Board approval,
BCEs policies concerning business conduct, ethics, public disclosure of
material information and other matters.
Please refer to section 7.2 entitled Governance Committee report for a complete
description of the committee. |
PENSION COMMITTEE
The purpose of the Pension Committee is to assist
the Board in its oversight responsibilities related to:
-
the administration, funding and investment of BCEs
pension plans and fund
-
the unitized pooled fund sponsored by BCE for the
collective investment of the fund and the participant subsidiaries pension
funds.
Please refer to section 7.3 entitled Pension Committee report for a complete
description of the committee. |
Chair of the Board of directors
BCEs by-laws provide that directors may determine
from time to time whether the Chair should be an officer of BCE or should act
solely in a non-executive capacity. Should they decide that the Chair be an
officer acting in an executive capacity, the Board must designate one of its
members as the lead director, who is responsible for ensuring that the Board
can function independently of management.
For the past several years, the Board has decided that the Chair should be
separate from management |
Mr. T.C. ONeill is currently serving as Chair of
the Board and is not an executive officer of BCE. He is considered independent
under our director independence standards, which are consistent with the CSAs
corporate governance rules and guidelines and the NYSE governance rules.
The detailed mandate of the Board Chair is included
in the Boards charter, which can be found in the governance section of our
website at BCE.ca, on SEDAR at
sedar.com and on EDGAR at sec.gov.
26
BCE Inc. 2015 PROXY CIRCULAR |
|
|
|
CORPORATE
GOVERNANCE PRACTICES |
6 |
BCEs President and CEO has primary responsibility
for the management of the business and affairs of BCE. As such, the President
and CEO, subject to the Boards approval, develops BCEs strategic and
operational orientation. In so doing, he provides leadership and vision for the
effective overall management, profitability and growth of BCE, and for
increasing shareholder value and ensuring compliance with policies adopted by
the Board. The President and CEO is directly accountable to the Board for all of
BCEs activities. The Board approved a written position description for the
President and CEO, which is available in the governance section of our website
at BCE.ca.
Composition of the Board of
directors and nomination of directors |
In terms of the composition of BCEs Board, the
objective is to have a sufficient range of skills, expertise and experience to
ensure that the Board can carry out its responsibilities effectively. Directors
are chosen for their ability to contribute to the broad range of issues with
which the Board routinely deals.
The Board reviews each directors contribution and
determines whether the Boards size allows it to function efficiently and
effectively. The Board believes that a board of directors composed of 13 members
promotes effectiveness and efficiency.
The Board aims to attract the most highly qualified
directors and to achieve a board:
-
of an appropriate size that can function effectively
as a body
-
with an appropriate and diverse mix of skills,
expertise and experience among its members, and
-
with a membership that is geographically
representative of BCEs shareholder base.
The Governance Committee receives suggestions for
Board candidates from individual Board members, the President and CEO,
shareholders and professional search organizations. On a regular basis, the
Governance Committee reviews the current profile of the Board, including the
average age and tenure of directors and the representation of various areas of
expertise and experience and general conformity with the Board composition
policy.
In November 2014, on the recommendation of the Governance Committee, the
Board appointed two new directors following the retirement of four directors,
ensuring the appropriate mix of skills, expertise, experience and geographical
representation is maintained at the Board level |
The two new directors are:
-
Robert P. Dexter of Halifax (Nova Scotia), Chair and
CEO of Maritime Travel Inc., and a member of the Board of Bell Aliant Inc. prior
to its privatization by BCE on October 31, 2014.
More information regarding Mr. Dexter can be found in section 4 entitled
About the Nominated Directors
-
Gordon M. Nixon of Toronto (Ontario), corporate
director, and until August 2014 President and CEO of Royal Bank of Canada.
More information regarding Mr. Nixon can be found in section 4 entitled About
the Nominated Directors.
With respect to tenure, the Board strives to achieve
a balance between the need to have a depth of institutional experience from its
members on the one hand and the need for renewal and new perspectives on the
other hand. The Board tenure policy does not impose an arbitrary retirement age limit, but with respect to
term limits, it sets as a guideline that directors serve up to a maximum term of
12 years, assuming they are re-elected annually and meet applicable legal
requirements. The Board, however, upon recommendation of the Governance
Committee, is able to, in certain circumstances, extend a directors initial
12-year term limit.
In February 2015, the Board, on the recommendation
of the Governance Committee, approved a one-year extension of the term of Mr.
T.C. ONeill as director of BCE. This one-year extension was approved to ensure
a seamless transition to the position of Chair of the Board following a
significant number of changes to the composition of the Board in 2014, including
the departure of four directors and the appointment of two new directors. The
Governance Committee, in making its recommendation to the Board, considered the
exceptional contribution of Mr. ONeill as Chair of the Board as well as the
following factors, among other:
-
the need to ensure that the Board maintains an
appropriate level of experience in and knowledge of BCEs business to allow it
to discharge its duties effectively
-
Mr. ONeill is retired and is not involved in
professional activities other than serving on various public company boards of
directors
-
Mr. ONeill has extensive experience and knowledge
of BCEs business as Chair of the Board, which serves the best interests of BCE
shareholders
-
Mr. ONeill has attended 100% of Board meetings
since his appointment as Chair in 2009.
In 2015, the Board adopted a diversity policy and a target regarding the
representation of women on the Board |
In February 2015, the Board, on the recommendation
of the Governance Committee, updated its Board composition policy (now the Board
composition and diversity policy) to incorporate certain considerations in
respect of Board diversity.
The policy provides that the Governance Committee
will, when identifying and considering individuals for election to the Board
within the general framework set out above, consider only the most qualified
candidates based on their skills, expertise, experience and background. It will
also consider the level of representation of women on the Board, and strive to
include, within the candidates considered, individuals with a diverse
background, including gender, ethnicity, age and experience. Pursuant to the
policy, the Governance Committee may, subject to approval of the Board, adopt
targets regarding the representation of women on the Board. Finally, the policy
states that, on a yearly basis, the Governance Committee will report to the
Board in respect of the measures taken to ensure that the policy has been
effectively implemented, the annual and
|
|
BCE Inc.
2015 PROXY CIRCULAR
27 |
6 |
CORPORATE
GOVERNANCE PRACTICES |
|
cumulative progress in achieving the objectives of
the policy and the effectiveness of the policy as a whole. In measuring the
effectiveness of the policy, the Governance Committee will consider its
identification and consideration of any individuals to become Board members in
the previous year and whether and how the policy influenced such identification
and consideration.
In February 2015, the Board, on the recommendation
of the Governance Committee, approved a target that women represent at least 25%
of non-executive directors by the end of 2017. The director nominees for the
meeting include two women, representing 17% of non-executive director nominees
and 15% of all director nominees.
We maintain a competency matrix in which directors
indicate their expertise level in areas we think are required at the Board for a
company like ours. Each director has to indicate the degree to which he or she
believes they possess these competencies. The table below lists the top three
competencies of our current directors together with their age range, tenure,
linguistic background and residency.
(1) |
Definition of core competencies
- Telecommunications: senior executive experience
in the telecommunications industry
- Media/Content: senior executive
experience in the media or content industry
- Retail/Customer: senior
executive experience in a mass consumer industry
- Technology: senior
executive experience in the technology industry
- CEO/Senior Management: experience as a CEO or
senior executive of a major public company or other major organization
- Accounting & Finance: experience with, or
understanding of, financial accounting and reporting, corporate finance and
familiarity with financial internal controls, and Canadian GAAP/IFRS
- Government/Regulatory Affairs: experience in,
or understanding of, government, relevant government agencies and/or public
policy in Canada
- Investment Banking/M&A: experience in investment
banking and/or major transactions involving public companies
- Risk
Management: experience in, or understanding of, internal risk controls, risk
assessment, risk management and/or reporting.
|
Audit Committee members financial
literacy, expertise and simultaneous service |
Under applicable rules, the Corporation is required
to disclose whether its Audit Committee members include at least one audit
committee financial expert. In addition, we are subject to Canadian and NYSE
corporate governance rules relating to audit committees and certification of
financial information requiring that all Audit Committee members be financially
literate.
The Board has determined that all members of the
Audit Committee during 2014 were, and all current members of the Audit Committee
are, financially literate. In respect of the current Audit Committee members, as
well as members during 2014, the Board determined that at least one of the members of the Audit Committee,
being its Chair, Mr. P.R. Weiss, is qualified as an audit committee financial
expert.
The NYSE rules followed by the Corporation require
that if an audit committee member serves simultaneously on the audit committee
of more than three public companies, the Board must determine and disclose that
this simultaneous service does not impair the ability of the member to
effectively serve on the Audit Committee. None of the current members of the
Audit Committee serve on the audit committee of more than three public
companies.
28
BCE Inc. 2015 PROXY CIRCULAR |
|
|
|
CORPORATE
GOVERNANCE PRACTICES |
6 |
Board of directors assessments |
As part of its charter, the Governance Committee
develops and oversees a process to enable each director to assess the
effectiveness and performance of the Board and its Chair, the Board committees
and their respective chairs and himself or herself as a member of the Board. For
2014, the assessment process was conducted as follows:
Each director completed
questionnaires aimed at evaluating his or her own performance as a member of the
Board, the performance of the Board as a whole and its Chair, as well as the
performance of each Board committee on which she or he serves and their
respective Chair. |
Each director then met separately
with the Chair of the Board and the Chair of the Governance Committee to review
the results of the questionnaires and to discuss and assess the performance of
the Board and its Chair, the committees and their Chairs and their director
colleagues. |
Following this process, in camera
sessions of the Governance Committee and the Board were held, at which the
feedback from the questionnaires and the one-on-one meetings and the
appropriateness of any modifications or enhancements were reviewed and
discussed. |
Independence of the Board of
directors |
The Boards policy is that at least a majority of
its members must be independent. Acting on the recommendation of the Governance
Committee, the Board is responsible for determining whether or not each director
is independent. For a director to be considered independent, the Board analyzes
all of the relationships each director has with BCE and must determine that the
director does not have any direct or indirect material relationship with us. To
guide this analysis, the Board has adopted director independence standards.
These standards are consistent with the CSA and the NYSE rules, are reviewed by
the Governance Committee every year and can be found in the governance section
of our website at BCE.ca.
Information concerning the relationships each
director has with BCE is collected through the following sources: directors
responses to a detailed questionnaire, biographical information of directors,
our internal corporate records, external verifications and any required
discussions with our directors. Furthermore, each year, directors certify that
they comply with our Code of Business Conduct, including the obligation to
disclose any actual or potential conflict of interest.
In the course of the Boards determination regarding
independence, it evaluated the relationships of each director with BCE against
the independence standards outlined above and considered all relevant
transactions, relationships and arrangements with companies or organizations
with whom our directors may be associated. Among other things, the Board
considered whether the independence of Mr. I. Greenberg, who brings significant,
important and necessary media industry experience to the Board, the Audit
Committee and the Compensation Committee, was affected by the fact that he held
the position of CEO of Astral Media Inc. (Astral), a company acquired by BCE
in July 2013. The Board determined that his independence was not affected by
this factor, including for the following reasons: (i) upon closing of the
acquisition, all of Mr. Greenbergs relationships with Astral ceased, (ii) Mr.
Greenberg joined the BCE Board following the closing of the acquisition, (iii)
Mr. Greenberg has never held any employment or executive position with BCE or
its affiliated entities, (iv) Mr. Greenberg did not retain any interest in
Astral following the acquisition, no amounts were or are owed to him
by BCE, nor did he receive any interest in BCE on closing, (v) Mr. Greenberg
receives no compensation from BCE or its affiliated entities other than director
fees, (vi) Astral, which represented approximately 5% of BCEs revenues and
assets, has been fully integrated in the Bell Media division, and (vii) Mr.
Greenberg does not have any other material relationship with BCE or its
affiliated entities. As part of its determination, the Board considered the
level of integration of Astral into BCEs Bell Media unit, in particular the
fact that Bells financial and control systems apply to all of Bell Media,
including the businesses that were formerly Astral.
As a result of the foregoing assessment, the Board
determined that each of BCEs current director nominees (with the exception of
our President and CEO, Mr. G.A. Cope) does not have a material relationship with
BCE and is independent. As an officer of BCE, Mr. G.A. Cope is not considered to
be independent under these rules.
All Board members other than the President and CEO are independent
All
members of the committees of the Board are independent
|
All members of the Audit Committee, Compensation
Committee and Governance Committee must be independent as defined under BCEs
director independence standards. Members of the Audit Committee and Compensation
Committee must also satisfy more stringent independence requirements, as defined
under BCEs director independence standards. The Board has determined that, as
of the date of this circular, members of all committees of the Board are
independent and that members of the Audit Committee and Compensation Committee
satisfy these more stringent independence requirements.
|
|
BCE Inc.
2015 PROXY CIRCULAR
29 |
6 |
CORPORATE
GOVERNANCE PRACTICES |
|
Board interlocks
The Boards approach to board interlocks is to the
effect that no more than two Board members may sit on the same public company
board.
Common memberships on boards of public companies
among our current directors are set out in this table. The Board has determined
that these board interlocks do not impair the ability of these directors to
exercise independent judgment as members of our Board.
COMPANY |
|
DIRECTOR |
|
COMMITTEE MEMBERSHIP |
Bank of Montreal |
|
S. Brochu |
|
Audit |
|
|
G.A. Cope |
|
Human Resources |
The Bank of Nova Scotia |
|
R.A. Brenneman |
|
Human Resources, Executive and Risk |
|
|
T.C. ONeill |
|
Audit, Governance, Executive and Risk, Human Resources |
|
STATUS OF DIRECTOR NOMINEES |
|
|
|
|
REASON FOR |
NAME |
INDEPENDENT |
NOT INDEPENDENT |
NON-INDEPENDENT STATUS |
B.K. Allen |
X |
|
|
R.A. Brenneman |
X |
|
|
S. Brochu |
X |
|
|
R.E. Brown |
X |
|
|
G.A. Cope |
|
X |
President and CEO |
D.F. Denison |
X |
|
|
R.P. Dexter |
X |
|
|
I. Greenberg |
X |
|
|
G.M. Nixon |
X |
|
|
T.C. ONeill |
X |
|
|
R.C. Simmonds |
X |
|
|
C. Taylor |
X |
|
|
P.R. Weiss |
X |
|
|
Expectations and personal
commitments of directors |
The Board expects all of its members to comply with
BCEs Statement of Corporate Governance Principles & Guidelines. Members are
also expected to comply with BCEs policies that apply to directors and the
various Board procedures and practices. These procedures include the declaration
of interest and changes in principal occupation (see below for details), the
conflicts of interest guidelines (see below for details), the share ownership
guidelines (see section 5 entitled Director Compensation for details) and
the Code of Business Conduct (see further under Ethical Business Conduct
for details).
The Board also expects all of its members to
demonstrate personal and professional characteristics beyond reproach. These
characteristics include high ethical standards and integrity, leadership,
financial literacy and current fluency in their own field of expertise.
In 2014, the current directors, as a group, attended 97% of all Board and
committee meetings and 100% of regular Board meetings |
The Board further expects all of its members to make
meaningful commitments during their time as directors of BCE. Each director is
expected to participate in the director orientation program and in continuing
education and development programs. They are expected to develop and expand a
broad, current knowledge of the nature and operation of our major business
units. Similarly, all members are expected to commit the necessary time required
to be an effective and fully contributing member of the Board and of each Board
committee on which they serve. In this regard, the Board recommends that
directors limit the number of boards of directors on which they serve to no more
than six public company boards, including BCEs Board.
The Governance Committee is responsible for
administering BCEs policy on directors attendance at meetings of the Board and
its committees. Under this policy, the Corporate Secretary must report to the
Governance Committee any director who did not attend at least 75% of the
combined Board and committee meetings held in the year.
The following table indicates the attendance of our
current directors at Board and committee meetings during 2014:
|
REGULAR |
SPECIAL |
TOTAL |
AUDIT |
COMPENSATION |
GOVERNANCE |
PENSION |
|
NAME |
BOARDS |
BOARDS(1) |
BOARDS |
COMMITTEE |
COMMITTEE |
COMMITTEE |
COMMITTEE |
TOTAL |
B.K. Allen |
6/6 |
4/5 |
10/11 |
|
5/5 |
4/4 |
|
95% |
R.A. Brenneman |
6/6 |
4/5 |
10/11 |
|
5/5 (Chair) |
|
1/1 |
94% |
S. Brochu |
6/6 |
5/5 |
11/11 |
5/5 |
- |
4/4 |
|
100% |
R.E. Brown |
6/6 |
4/5 |
10/11 |
|
5/5 |
4/4 (Chair) |
|
95% |
G.A. Cope |
6/6 |
5/5 |
11/11 |
|
|
|
|
100% |
D.F. Denison |
6/6 |
3/5 |
9/11 |
5/5 |
|
|
4/4 (Chair) |
90% |
R.P. Dexter(2) |
2/2 |
2/2 |
4/4 |
|
|
|
|
100% |
I. Greenberg |
6/6 |
4/5 |
10/11 |
4/5 |
2/2 |
|
|
89% |
G.M. Nixon(2) |
2/2 |
2/2 |
4/4 |
|
|
|
|
100% |
T.C. ONeill(3) |
6/6 |
5/5 |
11/11 |
|
|
|
|
100% |
R.C. Simmonds |
6/6 |
5/5 |
11/11 |
5/5 |
|
4/4 |
|
100% |
C. Taylor |
6/6 |
5/5 |
11/11 |
|
|
4/4 |
4/4 |
100% |
P.R. Weiss |
6/6 |
5/5 |
11/11 |
5/5 (Chair) |
|
|
4/4 |
100% |
TOTAL |
100% |
90% |
95% |
96% |
100% |
100% |
100% |
97% |
(1) |
Due to exceptional circumstances, special
Board meetings may have to be called on short notice and must, on occasion, be
held at a time and date when the largest number of directors is available but
certain members may be unable to attend. |
(2) |
Mr. Dexter was appointed to the Board on
November 1, 2014 and to the Audit and Pension Committees on November 6, 2014.
Mr. Nixon was appointed to the Board on November 4, 2014 and to the Compensation
and Governance Committees on November 6, 2014. |
(3) |
As Chair of the Board, Mr. ONeill is not a
member of any committee of the Board but attends as an ex officio member on all
committees. |
30
BCE Inc. 2015 PROXY CIRCULAR |
|
|
|
CORPORATE
GOVERNANCE PRACTICES |
6 |
Directors must follow the procedure for declarations
of interest and changes in their principal occupation. The procedure is designed
to enable the Governance Committee to be notified in a timely fashion of any
change in a directors external directorships and principal occupation, and to
permit the Governance Committee to review and consider any possible effect of
such a change on the suitability of that directors continued service as a
member of the Board. This procedure also states that directors are expected to
tender their resignation upon a change in their principal occupation, which only
becomes effective when it is accepted by the Board upon the recommendation of
the Governance Committee.
BCEs conflicts of interest guidelines for directors
set out how conflict situations will be managed during a Board meeting. If a
director is deemed to have a conflict of interest because of an interest in a
party to a proposed contract or transaction with BCE, then a specific
declaration of interest is noted in the minutes of the meeting. As well, the
conflicted director must abstain from voting on the matter. Depending on
circumstances, the director may also withdraw from the meeting while the Board
deliberates. This procedure is followed on an as-required basis.
Orientation and continuing education |
New directors are given the opportunity to
individually meet with members of senior management to aid in their
understanding of our businesses. The Governance Committee assists new directors
in becoming acquainted with BCE and its governance processes and encourages
continuing education opportunities for all members of the Board.
We provide to new and existing directors a
comprehensive reference manual containing information with respect to: all key
corporate and Board policies, including the Code of Business Conduct; the
structure and responsibilities of the Board and its committees; the legal duties
and liabilities of directors; and BCEs articles and by-laws.
All directors have regular access to senior
management to discuss Board presentations and other matters of interest. We also
give directors the opportunity to enhance their understanding of our operations
and the telecommunications and media industries through various site visits or
pairings for one day with field technicians.
The Board has adopted guidelines with respect to
directors attendance at external continuing education programs under which BCE
reimburses the costs of attendance, and we encourage our directors to attend
conferences, seminars or courses, whether they be industry-specific to BCE or
whether relevant to fulfilling their role as a director. During 2014, our
directors have attended a number of such events in various areas of relevance to
their function as Board member.
Furthermore, in recognition of the rapidly changing
technology and competitive environment in our business, the Board, at regularly
scheduled meetings, requires management to provide an in-depth review of the
business segments in which we operate, as well as our industry in general. We
have listed below a sample of different internal sessions attended by our
directors in 2014.
DATE |
SUBJECT |
ATTENDEES |
PRESENTED BY |
February 5, March 5, August 6 |
Update on executive compensation trends and best practices |
Compensation Committee Members |
EVP Corporate Services |
February 5, March 5, May 5, August 6, November 5 |
Update on audit governance and major accounting policies |
Audit Committee Members |
Senior Vice-President and Controller |
February 5, March 5, August 6, November 5 |
Update on developments in corporate governance |
Governance Committee Members |
Senior Vice-President General Counsel and Corporate Secretary |
November 5 |
Update on Bells mental health initiatives |
Governance Committee Members |
Chair Bell Mental Health Initiative |
February 5, May 5, August 6, November 5 |
Update on pension reform initiatives |
Pension Fund Committee Members |
Vice-President Pension & Benefits |
February 5, March 6, August 6 |
Update on regulatory developments |
All Board Members |
EVP and Chief Legal & Regulatory Officer |
March 6 |
Update on media business |
All Board Members |
President Bell Media |
August 7 |
Update on wireless business |
All Board Members |
President Bell Mobility & BRS & Chief Brand Officer |
November 6 |
Enterprise risk management presentation |
All Board Members |
Vice-President Audit and Risk Advisory Services |
November 6 |
Update on customer operations |
All Board Members |
EVP Customer Operations |
December 10 |
Presentations by all business units |
All Board Members |
Each Business Unit Head |
|
|
BCE Inc.
2015 PROXY CIRCULAR
31 |
6 |
CORPORATE
GOVERNANCE PRACTICES |
|
6.2 Shareholder engagement |
The Board remains committed to engaging actively
with the shareholders of the Corporation. Meetings are held regularly between
our executive officers and institutional shareholders. On a quarterly basis, we
hold a conference call with the investment community to review the financial and
operating results of the quarter. Our executive officers and other members of
the senior management team are regularly invited to speak at broker-sponsored
industry investor conferences. All these presentations are accessible to our
shareholders on our website at BCE.ca.
Shareholders can communicate with the Corporation through various means,
including email and telephone |
Our Investor Relations department is committed to
meeting with brokers and actively engages with retail shareholders to address
any shareholder-related concerns and to provide public information on the
Corporation. On a regular basis, either the Chair of the Board, the Chair of the
Compensation Committee or the Chair of the Governance Committee and members of
management meet with shareholder advocacy groups to discuss governance issues.
We have in place various means of communication for
receiving feedback from interested parties. We have a toll-free number for
general inquiries (1-888-932-6666) and for investor and shareholder inquiries
(1-800-339-6353). Shareholders and other interested parties may also communicate
with the Board and its Chair by contacting the Corporate Secretarys Office at
corporate.secretariat@bell.ca or by calling 514-786-8424. For any
complaints and/or concerns with respect to BCEs accounting, internal accounting
controls or auditing matters, interested parties should consult our Complaint
Procedures for Accounting and Auditing Matters on our website at
BCE.ca.
Our shareholders will be asked again this year to
consider and approve an advisory resolution on our approach to executive
compensation. The Board, the Compensation Committee and management will continue
existing practices discussed above regarding shareholder discussion and
engagement. The Board and the Compensation Committee will continue to review and
consider all shareholder feedback related to executive compensation matters. To
facilitate questions and comments from shareholders the following means of
communication are available:
-
communicating with the Compensation Committee by
mail: BCE Inc. c/o Chair of the Management Resources and Compensation Committee,
1 Carrefour Alexander-Graham-Bell, Building A, 7th floor, Verdun, QC, H3E 3B3,
or by email: corporate.secretariat@bell.ca
-
using our web tool, accessible through our website
at BCE.ca under the banner
2015 Annual Meeting of Shareholders and then following the instructions
on screen, or
-
calling us at 1-800-339-6353 (service in both
English and French).
The Corporation will review all correspondence
received and will periodically post a summary of comments received, if any,
together with our responses on our website, accessible through
BCE.ca under the banner 2015 Annual Meeting of
Shareholders.
Also, the Compensation Committee and the Board will
review and analyze the results of the advisory vote on our approach to executive
compensation and will take into consideration such results when reviewing
executive compensation philosophy, policies and programs.
The Board confirms that our current practices
achieve substantially the same results as the CCGGs Model Policy of the Board
of Directors on Engagement with Shareholders on Governance Matters and Say on
Pay Policy for Boards of Directors.
6.3
Ethical business conduct |
Regular reports are provided to the Audit Committee
and the Governance Committee with respect to our ethics program and our
oversight of corporate policies across BCE.
BCEs EVP and Chief Legal & Regulatory Officer has
overall responsibility for (among other things):
- the oversight of BCEs ethics program, including
the Code of Business Conduct and ethics training
- our anonymous 24/7 Employee Help Line that assists
employees with any ethical issues and reporting of issues relating to
questionable accounting, internal controls, auditing matters or corporate fraud,
and
- the oversight of BCEs corporate policy management
framework designed to improve employee awareness and access to some of the core
corporate policies and business unit-specific practices, processes and
procedures.
The most significant corporate-wide policies with
respect to business ethics are the Code of Business Conduct, the Complaint
Procedures for Accounting and Auditing Matters (Whistleblowing Procedures), the
Disclosure Policy and the Auditor Independence Policy. These policies are
available in the governance section of our website at
BCE.ca.
CODE OF BUSINESS CONDUCT
Our Code of Business Conduct provides various rules
and guidelines for ethical behaviour based on BCEs values, applicable laws and
regulations and corporate policies. The Code of Business Conduct applies to all
employees, officers and directors. In recognition of the important role of the
directors and senior management personnel in demonstrating their commitment to
and support of BCEs ethics program, as embodied in the values and rules set out
in the Code of Business Conduct, the Board requires all directors and executives
to certify annually their compliance with the Code of Business Conduct.
32
BCE Inc. 2015 PROXY CIRCULAR |
|
|
|
CORPORATE
GOVERNANCE PRACTICES |
6 |
This certification also confirms their express
support for the setting of standards to discourage wrongdoing and to promote
honest and ethical conduct throughout the organization.
The Board requires all directors, executives and employees to certify
annually their compliance with our Code of Business Conduct |
Our shareholders, customers and suppliers expect
honest and ethical conduct in all aspects of our business. Accordingly, we also
require that all employees certify annually that they have reviewed and
understand the Code of Business Conduct. In addition, all new employees are
required to complete an online training course on the Code of Business Conduct
within the first week of being hired. All employees are required to complete the
online training course every two years.
Employees must also report to their manager any real
or potential conflict of interest and, as required, provide written disclosure
of such conflict to the Corporate Secretary. In addition to the requirements to
comply with the conflict of interest guidelines and procedures set out in the
Code of Business Conduct, all employees are required to disclose to the
Corporate Secretary any potential or actual conflict of interest. The Corporate
Secretary is responsible for managing and resolving conflict of interest issues
of employees.
The Audit Committee has established whistleblowing procedures for
confidentially and anonymously submitting concerns from employees about
questionable accounting or auditing matters |
BCE considers it vital that employees have the most
effective tools to ask questions or raise issues concerning any ethical dilemma.
Our Employee Help Line can be accessed online on a completely anonymous and
confidential 24/7 basis, to ask questions or report concerns relating to issues
under the Code of Business Conduct. This system is administered by an
independent firm specializing in the field. This system also provides employees
a means to track the progress of their enquiries online, responds to requests
for additional information (when required) and provides BCE with an auditable
record of issues raised.
COMPLAINT PROCEDURES FOR ACCOUNTING
AND AUDITING MATTERS
The Audit Committee has established procedures for
receiving, filing and handling complaints that the Corporation or any of its
subsidiaries might receive about:
-
accounting, internal accounting control or auditing
matters, and
-
evidence of an activity that may constitute
corporate fraud, violation of federal or provincial laws, or misappropriation of
property that belongs to the Corporation or any of its subsidiaries.
Our employees have several means of communication
available to them, such as an Employee Help Line that can be accessed either by
telephone or online on a completely anonymous and confidential 24/7 basis,
e-mail and regular mail.
DISCLOSURE POLICY
The Board periodically approves policies for
communicating with our various stakeholders, including shareholders, employees,
financial analysts, governments and regulatory authorities, the media and the
Canadian and international communities. The Disclosure Policy was adopted to
govern our communications with the investment community, the media and the
general public. This policy was designed to assist us in seeking to ensure that
our communications are timely, accurate and broadly disseminated according to
the laws that apply to us. The policy establishes guidelines for the
verification of the accuracy and completeness of information disclosed publicly
and other guidelines dealing with various matters, including material
information, news releases, conference calls and webcasts, electronic
communications and rumours.
AUDITOR INDEPENDENCE POLICY
Our Auditor Independence Policy is a comprehensive
policy governing all aspects of our relationship with the external auditors,
including:
-
establishing a process for determining whether
various audit and other services provided by the external auditors affect their
independence
-
identifying the services that the external auditors
may and may not provide to the Corporation and its subsidiaries
-
preapproving all services to be provided by the
external auditors of the Corporation and its subsidiaries, and
-
establishing a process outlining procedures when
hiring current or former personnel of the external auditors in a financial
oversight role to ensure auditor independence is maintained.
In particular, the policy specifies that:
-
the external auditors cannot be hired to provide any
services falling within the prohibited services category, such as bookkeeping,
financial information systems design and implementation, and legal services
-
for all audit or non-audit services falling within
the permitted services category (such as prospectus, due diligence and
non-statutory audits), a request for approval must be submitted to the Audit
Committee prior to engaging the external auditors
-
specific permitted services, however, are
preapproved annually and quarterly by the Audit Committee and consequently only
require approval by the EVP and CFO prior to engaging the external auditors, and
-
at each regularly scheduled Audit Committee meeting,
a summary of all fees billed by the external auditors by type of service is
presented. This summary includes the details of fees incurred within the
preapproval amounts.
The Auditor Independence Policy is available in the
governance section of our website at BCE.ca.
|
|
BCE Inc.
2015 PROXY CIRCULAR
33 |
6 |
CORPORATE
GOVERNANCE PRACTICES |
|
The Board is responsible for ensuring that BCEs
management creates and supports a culture in which ethical business conduct is
recognized, valued and exemplified throughout the organization. The Board must
also satisfy itself as to the integrity of the President and CEO, other
corporate officers and senior management. Both the Governance Committee and the
Audit Committee support the Board in its oversight of BCEs ethics program. The
Governance Committee has the responsibility for the content of the policies with
respect to ethics, while the Audit Committee has the oversight responsibility
for compliance with these policies.
The Audit Committee receives a quarterly report
prepared by the Vice-President Audit and Risk Advisory Services providing
details of complaints received, if any, in respect of accounting and auditing
matters. This report also details the status of investigations and any follow-up
action required.
The Chair of the Audit Committee is notified by
either the EVP and Chief Legal & Regulatory Officer, the Senior Vice-President
General Counsel and Corporate Secretary or the Vice-President Audit and Risk
Advisory Services of any complaints that relate to accounting, internal
controls, auditing matters or corporate fraud. The results of any investigation
or follow-up action are provided to the Audit Committee.
The following documents, to which we have made
reference throughout this circular, are available on our website at
BCE.ca:
-
the charter of the Board, as well as of each of its
committees, including the position description of their respective chairs
-
the position description of the President and CEO
-
our director independence standards
-
our key corporate policies, including our Code of
Business Conduct
-
a summary of the differences between the NYSE rules
and BCEs corporate governance practices
-
this statement of corporate governance practices.
To obtain a printed version of any of these
documents free of charge, please write to the Corporate Secretarys Office at 1
Carrefour Alexander-Graham-Bell, Building A, 7th floor, Verdun, Québec, Canada,
H3E 3B3 or call 1-800-339-6353.
34
BCE Inc. 2015 PROXY CIRCULAR |
|
|
|
COMMITTEE
REPORTS |
7 |
This section includes reports from each of the
Boards four standing committees and tells you about their current members,
responsibilities and activities in the past year.
|
|
|
7.1 Audit Committee report
The Audit Committee assists the Board in its
oversight of the integrity of our financial statements, compliance with
applicable legal and regulatory requirements, the independence, qualifications
and appointment of the external auditors, the performance of both the external
and internal auditors, managements responsibility for assessing and reporting
on the effectiveness of internal controls and our enterprise risk management
processes.
Also see Schedule 1 Audit Committee Information
in our annual information form for the year ended December 31, 2014 (which you
can access on our website at BCE.ca, on SEDAR at
sedar.com
and on EDGAR at sec.gov), for
information about the Audit Committee, including its charter, information about
independence, financial literacy, relevant education and experience of Audit
Committee members, as well as Audit Committee policies and procedures for
engaging the external auditors. The charter of the Audit Committee is available
in the governance section of our website at BCE.ca.
|
The Audit Committee communicates regularly and
directly with management and the internal and external auditors. The Audit
Committee held five meetings in 2014. Time is set aside at each regularly
scheduled meeting for the committee members to meet without management, and the
internal and external auditors and to meet separately with each of management
and the internal and external auditors.
The Audit Committee continued to focus on four key
areas in 2014:
-
assessing the appropriateness of our financial
reporting
-
reviewing the adequacy of policies and processes for
internal control over financial reporting, risk management and compliance with
laws and regulations that apply to us, including oversight of compliance with
our Code of Business Conduct and environmental policy
-
monitoring the application of International
Financial Reporting Standards (IFRS), and
-
overseeing all aspects of the internal and external
audit functions.
FINANCIAL REPORTING
The Audit Committee meets to review the following
documents with management and the external auditors and recommends them to the
Board for approval:
-
our annual financial statements and quarterly
interim financial reports
-
the related managements discussion and analysis of
financial condition and results of operations (MD&A)
-
our annual report on Form 40-F for U.S. purposes
-
our annual information form (AIF)
-
our earnings press releases, and
-
our Safe Harbour Notice Concerning Forward-Looking
Statements.
This review is to provide reasonable assurance that:
-
the Corporations financial reporting is complete
and fairly presented in all material respects, and
-
the accounting principles used to prepare our
financial statements are appropriate, in particular where judgements, estimates,
risks and uncertainties are involved, and we have provided adequate disclosure
of material issues.
The Audit Committee also reviews new legal and
regulatory initiatives that apply to us and the adoption and disclosure of new
accounting standards. It also assesses the potential impact of choosing between
accounting alternatives, when appropriate.
DISCLOSURE CONTROLS & PROCEDURES
The Audit Committee is responsible for overseeing
managements assessment of disclosure controls and procedures, related
certifi-cations provided by the President and CEO and the CFO and any related
disclosures that may result from managements assessment.
Under applicable rules, the Corporation is required
to establish and maintain disclosure controls and procedures to ensure that the
information we publicly disclose is accurately recorded, processed, summarized
and reported on a timely basis. The Board has approved guidelines outlining the
Corporations disclosure controls and procedures, as well as a written charter
outlining the responsibilities, membership and procedures of the disclosure and
compliance committee. This committee consists of officers and other key
employees responsible for overseeing the accuracy and timeliness of the
Corporations disclosure documents.
|
|
BCE Inc.
2015 PROXY CIRCULAR
35 |
7 |
COMMITTEE
REPORTS |
|
As part of our disclosure controls and procedures,
we have established a comprehensive process to support the annual and quarterly
certifications required under applicable rules. Among other things, these
certifications by the President and CEO and the CFO state that:
-
they are responsible for establishing and
maintaining the Corporations disclosure controls and procedures
-
they have evaluated the effectiveness of these
disclosure controls and procedures
-
the Corporations annual financial statements,
quarterly interim financial reports, related MD&A and the AIF do not contain any
untrue statement of a material fact, and
-
the Corporations annual financial statements,
quarterly interim financial reports and other financial information fairly
present, in all material respects, the Corporations financial condition,
results of operation and cash flows.
INTERNAL CONTROL OVER FINANCIAL
REPORTING
The Audit Committee is responsible for overseeing
managements assessment of internal control over financial reporting (ICFR),
related certifications provided by the President and CEO and the CFO and any
related disclosures that may result from managements assessment.
Management has established a comprehensive process
to document ICFR and evaluate the effectiveness of such controls in compliance
with applicable rules. Management has prepared a report on the effectiveness of
ICFR as at December 31, 2014, which is filed as part of the Corporations annual
report. This management report contains:
- a statement of managements responsibilities for
establishing and maintaining adequate ICFR
- a description of the framework used to evaluate, and
managements assessment of, the effectiveness of the Corporations ICFR, and
- a statement that the external auditors have issued
an opinion to the effect that the Corporations ICFR was effective as at
December 31, 2014.
Regulations also require that the President and CEO
and the CFO, in separate individual certificates, attest as to the Corporations
ICFR. The President and CEO and the CFO have certified that they have disclosed
to the external auditors and the Audit Committee based on their most recent
evaluation of ICFR:
-
all significant deficiencies and material
weaknesses, if any, in the design or operation of ICFR that are reasonably
likely to adversely affect the Corporations ability to record, process,
summarize and report financial information, and
-
any fraud, whether or not material, that involves
management or other employees who have a significant role in the Corporations
ICFR.
The Audit Committee met with management, our
internal auditor and the external auditors, Deloitte LLP, over the course of
2014 to receive status reports on managements documentation and assessment
process. Management and the President and CEO and the CFO provided the Audit
Committee with their report on their review of the design and operating
effectiveness of ICFR as at December 31, 2014. No material weakness in the
design or operation of ICFR was noted.
The Audit Committee will continue to regularly
monitor managements evaluation process and the effectiveness of our ICFR
throughout 2015.
EXTERNAL AUDITORS
The Audit Committee is responsible for recommending
to the Board the appointment of the external auditors and their compensation.
The Audit Committee is directly responsible for:
-
evaluating the external auditors annually and
comprehensively at least every five years, to make sure that they fulfill their
responsibilities. The Audit Committee reviews the external auditors
performance, as well as their qualifications, independence, internal quality
control procedures, audit plans and fees, and
-
assessing the adequacy of the auditor independence
policy and approving recommendations for changes to, and monitoring compliance
with, the policy. This includes the process for approving in advance all audit
and other services to be provided by the external auditors.
INTERNAL AUDITOR
The Audit Committee also oversees the internal audit
function.
This includes:
-
overseeing internal audit plans, staffing and
budgets
-
evaluating the responsibilities and performance of
the internal auditor, and
-
reviewing periodic internal audit reports and
corrective actions being taken.
The Vice-President, Audit and Risk Advisory Services
reports directly to the Chair of the Audit Committee.
RISK MANAGEMENT
The Audit Committee also reviews, monitors, reports
on and, where appropriate, provides recommendations to the Board regarding:
-
our processes for identifying, assessing and
managing risk, and
-
our major financial risk exposures and the steps we
take to monitor and control such exposures.
For additional information, please see Risk
Oversight under section 6 entitled Corporate Governance Practices.
OTHER
The Audit Committee also reviews our compliance with
respect to our environmental policies and carries out an annual evaluation of
its performance with the Governance Committee, including a review of the
adequacy of its charter. Finally, the Audit Committee reports regularly to the
Board on its activities.
Report presented March 5, 2015, by:
P.R. Weiss,
Chair
S. Brochu, D.F. Denison, R.P. Dexter, I. Greenberg,
R.C. Simmonds
36
BCE Inc. 2015 PROXY CIRCULAR |
|
|
|
COMMITTEE
REPORTS |
7 |
|
|
|
7.2 Governance Committee report
The Governance Committee assists the Board in
developing and implementing our corporate governance guidelines, identifying
individuals qualified to become members of the Board and determining the
composition of the Board and its committees, determining the directors
remuneration, developing and overseeing an assessment process for the Board, and
reviewing and recommending for Board approval our corporate policies concerning
business conduct and ethics. The charter of the Governance Committee is
available in the governance section of our website at
BCE.ca.
|
The Governance Committee held four meetings in 2014.
The Governance Committee communicates regularly and directly with the officers.
Time is set aside at each regularly scheduled meeting for the committee members
to meet without management.
Highlights of items reviewed, reported on or
recommended by the Governance Committee to the Board in 2014 include the
following:
-
the size and composition of the Board to ensure that
the Board and its committees continue to benefit from the range of skills,
expertise and experience needed to function effectively and for sound succession
planning
-
the independence of directors and our director
independence standards; these standards are available in the governance section
of our website at BCE.ca
-
the financial literacy and expertise of the members
of the Audit Committee
-
the consideration of existing and new board
interlocks and of the possible effect of any change in a directors external
directorships or principal occupation on such directors suitability to continue
to serve as a director
-
the appointment of two new directors in November
2014
-
the changes in the composition of the Board
committees
-
the nominees for director who will stand for
election at the meeting
-
the annual review of the effectiveness of the Board
and of its committees and the assessment of the performance of each director and
of the Board, the Board Chair, Board committees and each committee Chair
- the directors attendance record
- the review of the adequacy and form of
non-management directors compensation for serving on the Board and its
committees, including the requirement for minimum share ownership, to ensure
that it continues to be appropriate (please refer to section 5 entitled Director Compensation
for a complete description of the directors
compensation in 2014)
- the monitoring of corporate governance developments
- how we align with various corporate governance
guidelines and initiatives
- the Boards statement of corporate governance
principles and guidelines, including the majority voting guidelines for the
election of directors
- the manner in which our shareholders will exercise
their voting rights at the meeting
- the approval in February 2015 of a Board diversity
policy as well as a target that women represent at least 25% of non-executive
directors by the end of 2017, and
- the approval in February 2015 of amendments to BCEs
By-law one as described in section 3.5 entitled Considering amendments to BCEs By-law one.
The Governance Committee also reviews annually the
adequacy of the charter of the Board, the charter of the Governance Committee
and the respective charters of each other committee of the Board. Finally, the
Governance Committee reports regularly to the Board on its activities.
Report presented March 5, 2015, by:
R.E. Brown,
Chair
B.K. Allen, S. Brochu, G.M. Nixon, R.C. Simmonds, C.
Taylor
|
|
BCE Inc.
2015 PROXY CIRCULAR
37 |
7 |
COMMITTEE
REPORTS |
|
|
|
|
7.3 Pension Committee report
The Pension Committee advises the Board on policies
relating to the administration, funding and investment of the pension plans,
pension funds and master fund. For the defined benefit component, the master
fund is a unitized pooled fund that the Corporation sponsors for the collective
investment of its pension fund and the pension funds of its participating
subsidiaries. For the defined contribution component, various investment options
are offered. The charter of the Pension Committee is available in the governance
section of our website at BCE.ca.
|
The Pension Committee held four meetings in 2014.
The Pension Committee communicates regularly and directly with the officers of
the Corporation. Time is set aside at each regularly scheduled meeting for the
committee members to meet without management.
Highlights of items reviewed and monitored, reported
on or recommended by the Pension Committee to the Board in 2014 include the
following:
- the performance of the pension funds and the
applicable statements of investment policies and procedures and, in particular:
- revising investment parameters such as the
allocation of the funds equity investments and the overall structuring of the
pension fund assets and the associated investment performance benchmarks
- requesting regular updates on discussion between
management and their pension investment advisory committee
- continuing to monitor the allocation of fund assets
between equities and fixed income to align more appropriately with pension
liabilities
- the financial situation and ensuring required
funding of BCEs and Bell Canadas pension plans and, in particular, their
sensitivity to the volatility of financial markets and to the applicable
long-term discount rates
- the pension integration plan for Bell Media and
approving the required amendments to the Bell Media pension plans
- the overall structure of the investment process,
including the periodic review of the performance of applicable investment
managers, and
- the review of the operating systems (including
control systems and procedures for supervising and monitoring the operating
systems) in place for carrying out our responsibilities as employer and
administrator of the pension plans, pension funds and master trust fund.
The Pension Committee also carries out an annual
evaluation of its performance with the Governance Committee, including the
review of the adequacy of its charter. Finally, the Pension Committee reports
regularly to the Board on its activities.
Report presented March 5, 2015, by:
D.F. Denison,
Chair
R.A. Brenneman, R.P. Dexter, C. Taylor, P.R. Weiss
38
BCE Inc. 2015 PROXY CIRCULAR |
|
|
|
COMMITTEE
REPORTS |
7 |
|
|
|
7.4 Compensation Committee report
The Compensation Committee is the human resources
committee of the Board. The Compensation Committee assists the Board of
Directors in its oversight responsibilities relating to compensation,
nomination, evaluation and succession of the President and CEO, other officers
and management personnel. In addition, the Compensation Committee oversees the
Corporations health and safety policies and practices. The charter of the
Compensation Committee is available in the governance section of our website at
BCE.ca. |
Please refer to the section entitled Executive
Compensation, on page 42, for a description of our compensation philosophy,
policies and programs and how our President and CEO, our CFO and our three other
most highly compensated executive officers are remunerated.
In 2014 with the retirements of André Bérard and
Anthony Fell from the Board, we welcomed Ian Greenberg and Gordon M. Nixon to
the Committee. Their experience and skills will enrich and broaden the portfolio
of knowledge and experience of the Committee. All members of the Compensation
Committee have a thorough understanding of the principles and policies
underlying executive compensation decisions. They acquired this through
experience as heads of human resources of large publicly-traded corporations or
as chairs and CEOs of sizeable businesses operating within large
publicly-traded corporations, as well as through other means. All members serve
or have served on compensation or human resources committees of other public
companies or have extensive knowledge of the most important subjects related to
executive compensation (such as the review of compensation contracts, leadership
and succession planning, the development of incentive plans, the analysis of the
compensation market, the financial analysis of compensation plans, pension fund
administration, the regulatory environment and the negotiation of employment
conditions). The table below demonstrates the breadth and balance of the
expertise of the Compensation Committee members by highlighting their five most
prominent skills related to compensation and human resources.
NAME |
CEO/EVP/CHIEF HR OF OTHER CORPORATION |
MEMBER/CHAIR OF HR COMMITTEE |
PENSION FUND ADMINISTRATION |
DRAFTING/ REVIEW OF COMP. CONTRACTS |
LEADERSHIP AND SUCCESSION PLANNING |
DEVELOPMENT/ OVERSIGHT OF INCENTIVES |
FINANCIAL AND MARKET ANALYSIS OF COMPENSATION |
NEGOTIATION OF EMPLOYMENT CONDITIONS |
R.A. Brenneman |
X |
X |
X |
X |
X |
|
|
|
B.K. Allen |
X |
X |
|
|
X |
|
X |
X |
R.E. Brown |
X |
|
X |
X |
X |
|
|
X |
I. Greenberg |
X |
X |
|
|
X |
X |
X |
|
G.M. Nixon |
X |
X |
|
|
X |
X |
X |
|
The Compensation Committee held five meetings in
2014. At each regularly scheduled meeting, the committee held an in-camera
session with no members of management or advisors present.
Highlights of items reviewed, reported on or
recommended by the Compensation Committee to the Board in 2014 include the
following:
-
the review of executive compensation philosophy,
policies and arrangements. These are further detailed under section 8 entitled
The Board of Directors Letter to Shareholders and section 9 entitled
Compensation Discussion & Analysis
-
the review and monitoring of the Corporations
exposure to risk related to its executive compensation practices and policies
and means to mitigate these risks
- the appointment or resignation of officers and the
consequent compensation changes to ensure that they are appropriate in relation
to both external and internal benchmarks
- the review of proposed major changes in organization
or personnel with the President and CEO
- the review of the President and CEOs performance
and recommendation of the terms of his compensation to the independent directors
of the Board for their approval
- the review with the President and CEO of the
performance of the other executive officers, including the review of their
personal leadership development plans and the determination of their annual
short-term incentive awards and other compensation components
- the review with the President and CEO of the
Corporations management resources and plans for ensuring appropriate succession
for officers and other senior management personnel
- the review of benefit plans under the Compensation
Committees authority
- the review of the equity programs and grant policy
|
|
BCE Inc.
2015 PROXY CIRCULAR
39 |
7 |
COMMITTEE
REPORTS |
|
-
the determination of equity-based grants for in-year
promoted employees and new hires. Key terms of equity-based plans are disclosed
under section 9 entitled Compensation Discussion & Analysis and
section 11 entitled Compensation of Our Named Executive Officers
-
the monitoring of developments related to executive
compensation
-
the monitoring of the Say on Pay voting results
obtained at the Annual General Shareholder Meeting and related feedback received
from shareholders
-
the review of the share ownership requirement
compliance by executive officers and monitoring of interim measures if
requirements are not met
-
the review of this report of the Compensation
Committee and the
Compensation Discussion & Analysis and Compensation of Our
Named Executive Officers disclosure
-
the review of our employee survey results
-
the review of health and safety statistics and
compliance with respect to health and safety policies.
The Compensation Committee also carries out an
annual evaluation of its performance with the Governance Committee, including
the review of the adequacy of its charter. At each regularly scheduled Board
meeting, the Compensation Committee, through its Chair, provides a report to the
Board on its activities.
RISK ASSESSMENT
The Committee has evaluated the risk associated with
our executive compensation programs and is comfortable that executives are not
encouraged to take undue risk on behalf of BCE for personal financial gain. A
detailed discussion of our risk assessment can be found in section 9.6 entitled
Compensation risk management.
SUCCESSION PLANNING
A critical responsibility of the Compensation
Committee is to ensure that a comprehensive succession plan is in place for the
Corporations most senior executive leaders. To achieve this, the committee
meets annually with the President and CEO to review and update the succession
plan for all executive officers, including the President and CEO position.
The plan identifies potential successors for each
executive and highlights any personal development experiences required for each
candidate to be fully prepared to take on the position. In addition, if
appropriate, the plan identifies any candidates who could assume critical
leadership roles in the short term should unexpected events leave such roles
vacant earlier than expected.
The executive succession plan is fully integrated
with the Corporations overall succession planning process which covers all key
management positions and ensures a strong pipeline of talent is developed at all
levels in the organization. As such, the plan presented to the Compensation
Committee is the culmination of an extensive process performed within each
business unit and function and integrated at the cross-company level. This
includes the identification of key talent, the roles they may be able to assume
in the future, and their development plan to prepare for these roles. This may
include development moves to other positions, internal or external courses, and
close on-the-job mentoring. If no strong internal succession candidates are
identified, an external search may be launched. Twice a year, all members of the
senior management team are reviewed by the President and CEO and his direct
reports in order to provide an integrated and balanced view of talent across the
Corporation and to ensure development plans are on track.
In addition to the regular annual review, key
executive talent and succession plans are discussed by the Compensation
Committee throughout the year, including, for example, as part of the
performance reviews used to determine executive compensation.
DIVERSITY AT THE SENIOR LEADERSHIP LEVEL
The Committee believes it is important to have a
diverse senior leadership team as this brings depth and breadth of perspective
and experience and reflects the diversity of our employees and our customer and
shareholder bases.
In seeking to foster diversity at the executive
officer level (the President and CEO and his most senior direct reports; EVPs),
the Committee considers factors such as gender, age, and whether an individual
is a visible minority or has a disability when making executive officer
appointments. With respect to gender diversity specifically, the Committee
considers the level of representation of women in executive officer positions.
However, these factors and considerations will not override the promotion of
candidates who possess appropriate skills, experience and leadership abilities.
The Corporation and the Committee have refrained from setting specific diversity
targets (including in respect of gender diversity) in order to ensure that they
identify and select the most capable candidates on the basis of these core
qualifications.
Bell is committed to fostering an inclusive,
equitable and accessible environment, where all employees and customers feel
valued, respected and supported. We are dedicated to building a workforce that
reflects the diversity of the communities in which we live and provide services,
and where every team member has the opportunity to reach their full potential.
To further reinforce its commitment to diversity and
inclusion, in 2014, Bell created the Diversity Leadership Council to champion
diversity and inclusion across Bell. Members are responsible for creating a plan
to further embed diversity and inclusion into their business units, to report
progress and ultimately improve representation within all BCE lines of business.
As at 31 December 2014, women represented 15% (2/13)
of executive officers and 25% of all executive positions (vice-president and
above), across all of the Corporations major subsidiaries.
40
BCE Inc. 2015 PROXY CIRCULAR |
|
|
|
COMMITTEE
REPORTS |
7 |
Services rendered by independent
compensation consultants |
Towers Watson was retained by management in 2014 to
provide benchmarking studies and market insights with respect to compensation of
executive officers as well as other members of management. Compensation
components (base salary, target annual short-term incentive, long-term
incentives, perquisite allowance and pension) were evaluated against our
comparator group. Towers Watson was first retained by management in 1986. Towers
Watson has historically been engaged directly by management and from time to
time management will provide an overview of Tower Watsons findings relevant to
executive compensation to the Committee.
In 2014 Hugessen was mandated by the Governance
Committee to perform a review of the compensation of non-management directors.
Hugessen was first retained in 2007.
COMPENSATION ADVISORY SERVICES
RELATED FEES
The table below summarizes the aggregate fees paid
to the compensation advisors for services they provided in 2013 and 2014.
|
EXECUTIVE COMPENSATION RELATED FEES |
ALL OTHER FEES |
ADVISOR |
2013 |
2014 |
|
2013 |
2014 |
Hugessen Consulting Inc. |
$16,065 |
$20,431 |
(1) |
|
|
Towers Watson |
$16,190 |
$205,341 |
(2) |
$19,336 |
$42,655 |
(1) |
For services provided by Hugessen to the
Governance Committee related to the review of compensation for the Corporations
non-management directors. |
(2) |
For services provided by Towers Watson to
management related to compensation not only of executive officers, but also of
other members of management who are not executive officers. |
INDEPENDENCE OF THE COMPENSATION
CONSULTANTS
None of our directors or executive officers has any
affiliation or relationship with Hugessen or Towers Watson. Hugessen does not
provide any services to management directly without the prior consent of the
Compensation Committee. No such services were provided by Hugessen in 2013 or
2014. The Committee is not required to pre-approve services that Towers Watson
provides to the Corporation at the request of management.
Hugessen and Towers Watson have both confirmed that
the fees received from BCE in 2013 and 2014, relative to the aggregate fees
received from all of their clients in 2013 and 2014, are not of such magnitude
as to compromise their independence from BCE or its management.
The executive compensation recommendations the
Compensation Committee makes to the Board are the responsibility of the
Committee and may reflect factors and considerations other than the information
and recommendations provided by the Compensation Committees consultant.
Report presented on March 5, 2015, by:
R.A.
Brenneman, Chair
B.K. Allen, R.E. Brown, I. Greenberg, G.M. Nixon
|
|
BCE Inc.
2015 PROXY CIRCULAR
41 |
EXECUTIVE COMPENSATION |
|
This section describes our compensation philosophy,
policies and programs and provides the details on the compensation of our named
executive officers (NEOs).
TABLE OF CONTENTS
8 |
The Board of Directors Letter to Shareholders |
43 |
9 |
Compensation Discussion & Analysis |
45 |
|
9.1 |
Overall objective of the executive compensation
program |
45 |
|
9.2 |
Setting executive compensation |
45 |
|
|
Benchmarking and comparator group |
45 |
|
9.3 |
Compensation policy and components |
47 |
|
9.4 |
2014 Named executive officers target pay at risk |
47 |
|
9.5 |
2014 Compensation elements |
48 |
|
|
Base salaries |
48 |
|
|
Annual short-term incentive |
48 |
|
|
Equity-based compensation |
51 |
|
|
Pension, benefits and perquisites |
54 |
|
9.6 |
Compensation risk management |
54 |
|
9.7 |
Shareholder return performance graph |
56 |
10 |
President and CEO Compensation |
57 |
11 |
Compensation of Our Named Executive Officers |
60 |
|
11.1 |
Summary compensation table |
64 |
|
11.2 |
Incentive plan awards |
66 |
|
11.3 |
Employees savings plans (ESPs) |
69 |
|
11.4 |
Pension arrangements |
69 |
|
11.5 |
Termination and change-in-control benefits |
72 |
42
BCE Inc. 2015 PROXY CIRCULAR |
|
|
|
THE BOARD OF DIRECTORS LETTER TO SHAREHOLDERS |
8 |
8 |
THE BOARD OF DIRECTORS LETTER TO SHAREHOLDERS |
2014 Highlights
- Introduction of more stringent share ownership
requirements
- Introduction of clawbacks for all NEOs and EVPs
- Introduction of revised Performance Share Unit
(PSU) payout range
- Pre-clearance process for all NEOs and EVPs
|
Dear fellow shareholders:
On behalf of the Compensation Committee and the
Board, we are pleased to share with you our approach to executive compensation,
including the framework we have used to make our compensation decisions for
2014.
Our annual Say on Pay advisory vote once again
received overwhelming support with over 95.99% of the votes cast in favour of
our executive compensation program. We appreciate this support and believe it
reflects broad and deep shareholder endorsement that our compensation philosophy
aligns the interests of shareholders and management, especially by incorporating
our dividend growth strategy into our long-term incentive performance criteria.
In 2014, the dividend was again increased by 6% to
reach $2.47. With the announcement of another increase of 5.3% in 2015, this
will bring the annual dividend payout to $2.60. The 2015 dividend increase
represents the eleventh increase to BCEs annual common share dividend, a 78%
increase, in the past six years.
Our approach to executive
compensation |
BCE is focused on a pay-for-performance approach to
compensation for all team members, including our executive team. This philosophy
supports the execution of Bells 6 Strategic Imperatives (Improve Customer
Service, Leverage Wireline Momentum, Achieve a Competitive Cost Structure,
Accelerate Wireless, Invest in Broadband and Expand Media Leadership) and our
commitment to deliver ongoing and stable returns to shareholders.
Our approach to compensation is to achieve one ultimate goal: to grow
long-term value for you |
Our executive compensation policies and programs are
designed to attract and retain the highest calibre of talent at a competitive
cost to the Corporation and to ensure they are motivated to pursue our goal to
grow long-term shareholder value.
We recognize that long-term growth and value
creation requires taking an acceptable level of risk and we ensure our
compensation policies and practices reward executives for short, medium and
long-term decision-making and performance, do not encourage undue risk-taking or
produce excessive compensation levels. We are committed to ensuring there is a
strong and direct link between our financial results, shareholder value creation
and the resulting executive compensation. In 2014 approximately 80% of our NEOs
target total direct compensation is tied to Bells performance.
Our key compensation decisions for
2014 |
We are satisfied that our compensation model, which
is comprised of a mix of base salary and short, medium and long term incentives
continues to reflect our compensation philosophy. It remained largely unchanged
in 2014.
BASE SALARY
Our policy is for base salaries to be positioned at
the 50th percentile of our comparator group. Salaries are reviewed from time to
time and adjusted to reflect increases in responsibilities and market trends. In
2014, aggregate NEO salaries increased 1.72% over the 2013 levels.
Details about any changes to base salaries can be found in section 11 entitled Compensation of Our Named Executive Officers.
ANNUAL SHORT-TERM INCENTIVE PLAN
Annual short-term incentive targets remained at
their 2013 levels of 100% of base salary for all of our executive officers and
150% for our President and CEO.
Our annual short-term incentive plan is designed to
reward achievement of a range of critical financial and operating metrics. The
financial metrics used again in 2014 EBITDA, Revenue and Free Cash Flow- are
key indicators widely used to measure financial performance in the
communications industry across North America. The operating metrics continued to
be based on the 6 Strategic Imperatives that guide the renewal of the Bell
brand,
|
|
BCE Inc.
2015 PROXY CIRCULAR
43 |
8 |
THE BOARD OF DIRECTORS LETTER TO SHAREHOLDERS |
|
our improved competitiveness and market performance
and an enhanced ability to return value to shareholders. This combination of
well-established financial and operating measures aligned with our strategy
provides the team with a clear and motivating compensation structure.
In 2014, the Corporation demonstrated growth across
all financial metrics. It exceeded its Revenue and Free Cash Flow targets while
making significant progress on the Strategic Imperatives. The continued momentum
of the Fibe TV service, the strength of the wireless and media businesses, the
$3.95 billion privatization of Bell Aliant, the leading wireline EBITDA margin
among North American telecom companies and progress on customer service led to a
strong year. Consequently, we were very pleased to approve a corporate
performance index of 105% out of a possible 150%. This index accounts for 70% of
the annual short-term incentives paid out to executive officers, while personal
performance accounts for the remaining 30%.
LONG-TERM INCENTIVE PLAN
Our long-term incentive plan did not change other
than increasing the PSU payout range from 0-100% to 0-125%. Executive grants
comprise 50% RSUs, 25% PSUs and 25% option grants.
The 2012 PSU grants vesting in 2014 achieved 100%
payout because our Free Cash Flow growth over the three year period was
sufficient to provide the Board with the ability to increase the dividend by the
target compound annual growth rate. To achieve full vesting on PSUs, the
dividend growth rate must remain within the dividend payout ratio (between 65%
and 75%) of Free Cash Flow, which it did. This is the same criteria for grants
made in 2013 and 2011. Prorated payment is made if the target is only partially
attained.
CHANGES TO EXECUTIVE COMPENSATION POLICY AND PROGRAMS
We implemented a number of changes in 2014 to
strengthen our compensation policies and programs from a governance perspective
and to increase alignment between executive decision making and shareholder
interests.
Extension of Clawbacks
The Board approved the implementation of a clawback
policy for all EVPs that mirrors the policy introduced for the CEO in 2011. The
policy will apply to any incentive compensation (annual short term incentive,
RSU, PSU and stock options) in the event of a material restatement of BCEs
financial statements caused or partially caused by gross negligence, intentional
misconduct or fraud on the part of the executive.
Pre-Clearance Process
In 2014, a pre-clearance process was introduced for
trading of BCE securities by the President and CEO and all EVPs to protect
against insider trading and trading during blackout periods.
Share Ownership Requirements
To encourage ongoing investment in the Corporation
and ensure continuous alignment of our executive officers compensation with our
objective of creating value for our shareholders, we introduced an additional
level of share ownership requirements: 10 times salary after 10 years for the
President and CEO and five times salary after 10 years for EVPs.
Maximum PSU Payout Level
To balance the risk in the PSU payout with an
incentive to outperform and align with market practices, the maximum PSU payout
level was increased from 100% to 125% for the 2014 PSU grants.
Executive Compensation Plans Remain Stable
We continuously monitor compensation levels and
trends in executive compensation and, we are confident that our current
compensation structure is competitive and fully meets the objectives of our
compensation philosophy. In 2014, we introduced a number of modifications to our
executive compensation programs and policies as explained above. A review of our
executive compensation programs as well as governance and market practices
during 2014 did not identify the need for any major revisions to these programs.
As such, we do not expect any significant changes to our executive compensation
programs in 2015.
Succession Planning for CFO
In 2014, Mr. Vanaselja announced his decision to
retire in 2015 after a highly successful career at BCE that spanned more than
two decades. After an extensive review of both internal and external potential
candidates, Mr. Glen LeBlanc, the former CFO of Bell Aliant, was selected as his
successor and will become CFO of BCE and Bell Canada upon Mr. Vanaseljas
retirement. The transition plan is well under way as Mr. Vanaselja and Mr.
LeBlanc are working together to ensure a seamless and orderly transition.
The responsibility for executive compensation rests
with the Board, and we confirm that we fully understand the long-term
implications of the executive compensation decisions we make and the programs we
approve.
Members of the Compensation Committee will be
present during the Annual General Shareholder Meeting, to be held on 30 April,
2015, to answer any questions you may have about executive compensation.
Alternatively, shareholders can write to the Corporate Secretarys Office or the
Investor Relations Group at 1 Carrefour Alexander-Graham-Bell, Building A, 7th
floor, Verdun, Québec, Canada, H3E 3B3 or call 1-800-339-6353. Our approach to
executive compensation supports the execution of the Corporations
strategy, and we remain committed to developing the compensation policies and
programs that will continue to produce the results that deliver value to you,
our shareholders.
|
|
Thomas C. ONeill
Chair of the Board |
Ronald A. Brenneman
Chair of the
Compensation
Committee |
March 5, 2015
44
BCE Inc. 2015 PROXY CIRCULAR |
|
|
|
COMPENSATION DISCUSSION & ANALYSIS |
9 |
9 |
COMPENSATION DISCUSSION & ANALYSIS |
This section describes our compensation philosophy,
policies and programs and discusses the compensation provided in 2014 to our
President and CEO, our CFO and our three other most highly compensated executive
officers. In 2014 these executive officers continued to grow and contribute to
the success of Bell. They are referred to in this document as the NEOs and are
as follows:
-
George A. Cope, President and CEO BCE and Bell
Canada
-
Siim A. Vanaselja, EVP and CFO BCE and Bell Canada
-
Wade Oosterman, President Bell Mobility and Bell
Residential Services and Chief Brand Officer Bell Canada
-
Kevin W. Crull, President Bell Media
-
Thomas Little, President Bell Business Markets
9.1 Overall objective of the
executive compensation program |
Our executive compensation is based on a
pay-for-performance philosophy. Its overall goal is to create sustainable value
for shareholders by:
-
attracting, motivating and retaining the executive
officers needed to drive the business strategy; and
-
rewarding them for financial and operating
performance and leadership excellence.
9.2 Setting executive compensation |
The roles of management and the Compensation
Committee in setting and administering executive compensation are described
below.
MANAGEMENT |
COMPENSATION COMMITTEE |
-
Proposes the elements of a compensation program that
supports a performance culture without undue risk taking
-
Implements the processes required to administer the
program
-
Manages the process to establish performance
objectives and to measure individual and corporate performance against set
objectives
-
Provides the Compensation Committee with an
assessment of the results achieved by each of the executive officers, as well as
an assessment of the leadership attributes each demonstrates in fulfilling his
or her roles and responsibilities
-
Recommends to the Compensation Committee the base
salary as well as the annual short- and long-term incentive award levels for the
officers of the Corporation
-
Proposes the succession plan for the officers of the
Corporation
-
Continuously monitors the regulatory environment and
market practices and informs the Compensation Committee about any developments
|
-
Oversees, and recommends for approval by the Board,
the Corporations executive compensation philosophy, policies, programs and
grants of equity-based compensation
-
Reviews with the President and CEO any proposed
major changes in organization or personnel, including the succession plan
-
Reviews any proposed major changes in the
Corporations benefit plans and recommends for approval any change requiring
Board approval
-
Reviews annually with the members of the Board the
performance of the President and CEO and other executive officers
-
Recommends annually to the members of the Board all
forms of compensation for the President and CEO and other officers
-
Reviews the Corporations executive compensation
disclosure for inclusion in the Corporations public disclosure documents
-
Reviews and monitors the Corporations exposure to
risk associated with its executive compensation and policies and identifies
practices and policies to mitigate such risk
-
Seeks advice from independent compensation
consultants on emerging trends in executive compensation and, when considered
advisable by the committee, other professional advice to enable the committee to
function independently of management
|
Benchmarking and comparator group
To ensure the competitiveness of the compensation
provided to our executives, the Compensation Committee regularly reviews the
compensation for similar executive positions at other companies with whom we
compete for talent (our comparator group).
In 2014, Towers Watson conducted a benchmarking
study of all executive positions, including the NEOs, using our revised
comparator group presented below. The results of the assessment showed that our
executive pay is well aligned to our executive compensation policy which targets
total compensation to be positioned at the 60th percentile of our
comparator group.
Our comparator group is designed to be
representative of the Canadian marketplace while avoiding overweighting any
particular industry. As a result, we do not include more than three companies
from any particular industry. We regularly review the composition of our
comparator group to ensure that the companies continue to reflect our context in
terms of size, revenues, market capitalization and complexity.
|
|
BCE Inc.
2015 PROXY CIRCULAR
45 |
9 |
COMPENSATION DISCUSSION & ANALYSIS |
|
In 2014, on the recommendation of Towers Watson, we
replaced EnCana Corporation, Kinross Gold Corporation, Metro Inc. and Shoppers
Drug Mart Corporation with Enbridge Inc., Quebecor Inc., Canadian Tire
Corporation Ltd. and Loblaw Companies Ltd. These modifications were made to
better reflect size, breadth of operations, industrial relevance and potential
competitors for talent.
The Compensation Committee uses our comparator group
to benchmark the value of executive total compensation, base salary, short- and
long-term incentives, benefits, retirement programs and perquisites. The
comparator group of 22 companies, the rationale for its use and comparative
financial information are outlined in the two tables below.
DESCRIPTION |
RATIONALE FOR USE |
LIST OF COMPANIES |
|
Represents a select sample of the largest Canadian
companies based on revenues and market capitalization and offers a similar
representation of industries |
Ensures the competitiveness of our executive
compensation by comparing it to that offered at companies that are similar to us
in terms of complexity, including size, revenues and market capitalization, and
that compete with us for key talent. The balanced representation of industries
ensures that our comparator group is representative of the marketplace in which
we compete for talent |
|
-
Manulife Financial Corporation
-
Potash Corporation of Saskatchewan Inc.
-
Quebecor Inc.
-
Rogers Communications Inc.
-
Royal Bank of Canada
-
Suncor Energy Inc.
-
Teck Resources Limited
-
Telus Corporation
-
The Toronto-Dominion Bank
-
TransCanada Corporation
|
COMPARATIVE FINANCIAL INFORMATION
AND INDUSTRY DISTRIBUTION OF COMPARATOR GROUP
BCE DECEMBER 31, 2014 RESULTS |
TOTAL REVENUE
($M) |
MARKET
CAPITALIZATION
($M) |
NET INCOME
($M) |
DIVIDEND
YIELD |
EMPLOYEES |
21,042 |
44,773 |
2,718 |
4.64% |
55,860 |
The comparator group information is just one of the
factors the Compensation Committee takes into consideration when making
recommendations to the Board with regard to target executive compensation. The
Compensation Committee also considers:
-
the relative pay levels among its most direct
industry competitors
-
the relative size, scope and complexity of
comparator businesses
-
BCEs relative performance against these
comparators.
46
BCE Inc. 2015 PROXY CIRCULAR |
|
|
|
COMPENSATION DISCUSSION & ANALYSIS |
9 |
9.3 Compensation policy and
components |
To achieve our objective, we use three key elements
of compensation with an aggregate target value positioned at the 60th percentile
of what is paid in the competitive market for similar positions. Consideration
is also given to pay levels among our most direct competitors within our
comparator group and their relative size, scope and complexity.
|
PRIMARY
OBJECTIVE |
WHAT DOES
THE COMPENSATION
ELEMENT REWARD? |
HOW IS THE AMOUNT
OR TARGET DETERMINED? |
HOW DOES THE COMPENSATION ELEMENT FIT INTO THE
OVERAL OBJECTIVE? |
FORM OF
PAYMENT |
Annual Base Salary |
Provides a market-competitive fixed rate of pay
|
The scope and responsibilities of the position and
the specific skills needed to fulfill them |
Set at the 50th percentile of what is paid in the
competitive market for similar positions |
Provides a vehicle to attract and retain skilled
executives who can deliver on our overall goal while keeping the emphasis on
rewarding actual performance |
Cash |
Annual Short-Term Incentive |
Encourages performance against our annual corporate
and individual objectives |
The achievement of our annual objectives
|
Set at the 75th percentile of what is paid in the
competitive market for similar positions. Payouts are capped at 2 times the
target award |
Provides a vehicle to reward actual performance
against objectives that are designed to support our overall Corporate targets
|
Choice of cash and/or DSUs
|
Equity-Based Long-Term Incentive Plan
|
Aligns long-term interests of executives and
shareholders |
The creation of shareholder value |
Brings total compensation(1) to the 60th
percentile of what is paid in the competitive market for similar positions.
Annual grant awards are capped |
Provides a vehicle to attract and retain skilled
executives while rewarding the achievement of our overall goal of creating
sustained shareholder value |
RSUs (50%)
PSUs (25%)
Stock Options (25%)
|
(1) |
Total compensation comprises base salary,
annual short, medium and long-term incentives. |
We also offer competitive pension, benefits and
perquisites to promote the hiring and retention of qualified executives. These
components are evaluated regularly as part of our benchmarking study. They are
discussed in section 9.5 entitled 2014 Compensation Elements under the
heading Pension, Benefits and Perquisites.
9.4 2014 Named executive officers
target pay at risk |
Our commitment to aligning pay to performance
leverages a compensation mix that includes short-, medium- and long-term
components. The graph below illustrates that we emphasize pay at risk over fixed
pay to ensure that executive remuneration is aligned with Corporate performance
over the short and long term. On average, 80% of target NEO compensation is at
risk.
2014 TARGET PAY AT RISK(1)
(1) |
Based on 2014 actual base salary. At-risk
components are based on target levels. Excludes pension and other compensation
elements. |
|
|
BCE Inc.
2015 PROXY CIRCULAR
47 |
9 |
COMPENSATION DISCUSSION & ANALYSIS |
|
9.5 2014 Compensation elements |
Base salaries
The Compensation Committee recommends for Board
approval the base salary of each executive officer within a clearly defined
salary range that reflects the scope and responsibilities of the position, the
executive officers experience, the positioning of his or her base salary and
total compensation versus the comparator group and internal equity. The
mid-point of the salary range corresponds to the median of the salary paid by
our comparator group for similar positions. Typically, the salary range is
within 20% around of the mid-point.
To ensure individual accountability and higher
levels of performance, base salaries offered to all executives have been
adjusted only to reflect sustained performance levels as well as an increase in
responsibilities or job scope.
Annual short-term incentive |
The annual short-term incentive applicable to the
President and CEO and all executive officers has two components. The corporate
performance component is based on quantitative financial targets and qualitative
objectives aligned with our 6 Strategic Imperatives. There is also an individual
component that allows the Compensation Committee to assess and reward leadership
behaviours demonstrated by the executive in the achievement of business-unit and
overall corporate results.
The Compensation Committee reviews annual short-term
incentive targets for our executive officers each year as well as upon hire,
promotion or when there are significant changes in the responsibilities of an
executive officer. When making a recommendation to set or increase the incentive
target of an executive officer, the Compensation Committee takes into
consideration the scope of the executive officers responsibilities, the
executive officers base salary, internal equity and the positioning of his or
her annual short-term incentive target compared to market.
Annual short-term incentive awards are calculated as
follows:
In order to reinforce our One Company/One Team
concept, 70% of the executive officers annual short-term incentive award is
based on the achievement of common corporate objectives. In order to recognize
and reward individual contributions, 30% of the executive officers annual
short-term incentive award is based on individual performance.
Following the end of each year, the Compensation
Committee and the Board evaluate the performance of the Corporation against the
corporate objectives established for the year to determine the corporate
performance index. This can vary between 0% and 150%, with a target performance
level of 100%. The Compensation Committee may, at its discretion, recommend to
the Board a different payout level from that suggested by the quantitative
results to take into account unforeseen occurrences and non-recurring events and
also to ensure that the payout is appropriate versus actual performance in the
Compensation Committees judgment. Over the past six years, the board exercised this discretion
twice. In 2009, the revenue results were lowered by 5% as a result of
unanticipated revenues from acquisitions and in 2010, the corporate performance
factor was reduced by 5% as a reflection of challenges in customer service. In
2014, no discretionary adjustments were made.
Once the year is completed, the Compensation
Committee and the independent directors of the Board assess the individual
performance and leadership of the President and CEO. In addition, the President
and CEO provides the Compensation Committee with his assessment of the
individual performance and leadership of the other executive officers. Taking
into account all information provided, including the recommendations of the
President and CEO with respect to the other executive officers, the Compensation
Committee exercises its discretion and recommends for Board approval the
individual performance index for each of the executive officers. The index can
vary between 0 and 3.0x, with a target of 1.0x.
The maximum payout that can be achieved on the
combined corporate and individual performance under the annual short-term
incentive formula is two times the target award.
2014 ANNUAL SHORT-TERM INCENTIVE
Corporate Performance Objectives
At the beginning of each year, the Compensation
Committee recommends for approval by the Board, the Corporations financial and
operating objectives used to determine the corporate performance objectives that
will account for 70% of the weighting of the annual short-term incentive award
for that year. The Compensation Committee reviews corporate performance from
year to year, ensuring a consistent difficulty in achieving target results in
light of the Corporations progress and the competitive environment.
48
BCE Inc. 2015 PROXY CIRCULAR |
|
|
|
COMPENSATION DISCUSSION & ANALYSIS |
9 |
The following illustration indicates the corporate
performance objectives employed for setting annual short-term incentive awards
for 2014, and the rationale for their use.
BCEs incentive plans are structured to maximize shareholder value. Share
price and capital returns are driven by operational and financial results
(revenue, EBITDA and free cash flow), dividend growth within our free cash flow
payout policy range and general market conditions. These financial and operating
goals largely result from the successful execution of the corporations 6
strategic imperatives |
WHY USE EBITDA(1)?
EBITDA is an industry-wide measure of in-year
operational profitability and is a common measure for valuation of companies in
the industry.
As such, EBITDA measures our executives operational
efficiency and their success in ensuring the value from revenues flows to the
enterprise value of the Corporation.
WHY USE THE 6 STRATEGIC IMPERATIVES?
The 6 Strategic Imperatives focus our efforts on
achieving our goal of being recognized by customers as Canadas leading
communications company. Their assessment includes many operating metrics
typically used in the industry.
As such, progress made against the 6 Strategic
Imperatives provides a relevant measure of our executives success in executing
on the operating plan required to achieve our goal.
WHY USE REVENUE?
Revenue is a simple measure of the total value of
the products and services sold by the Corporation.
As such, revenue provides a relevant measure of our
executives ability to design and sell attractive products and services, to
compete in the market, to attract customers and to capture value from those
products and services.
WHY USE FREE CASH FLOW(2)?
Free Cash Flow measures the cash generated by the
business after paying short-term operating costs, making long-term investments
and meeting financing costs. It is commonly used as a valuation measure for
companies in the industry.
Free Cash Flow provides an assessment of our
executives success in running the business as a whole and in generating cash
that may be returned to shareholders or further invested in the business.
(1) |
The term EBITDA does not have any
standardized meaning under IFRS. Therefore, it is unlikely to be comparable to
similar measures presented by other companies. We define EBITDA as operating
revenues less operating costs, as shown in BCEs consolidated income statements.
We use EBITDA to evaluate the performance of our businesses as it reflects their
ongoing profitability. We believe that certain investors and analysts use EBITDA
to measure a companys ability to service debt and to meet other payment
obligations or as a common measurement to value companies in the
telecommunications industry. EBITDA also is one component in the determination
of annual short-term incentive compensation for all management employees. EBITDA
has no directly comparable IFRS financial measure. |
(2) |
The term Free Cash Flow does not have any
standardized meaning under IFRS. It is therefore unlikely to be comparable to
similar measures presented by other companies. For 2014, we define Free Cash
Flow as cash flows from operating activities excluding acquisition costs paid,
plus dividends/distributions received from Bell Aliant, less capital
expenditures, preferred share dividends, dividends/distributions paid by
subsidiaries to non-controlling interest, and Bell Aliant Free Cash Flow. We
consider Free Cash Flow to be an important indicator of the financial strength
and performance of our business because it shows how much cash is available to
repay debt and reinvest in our Corporation. We present Free Cash Flow
consistently from period to period, which allows us to compare our financial
performance on a consistent basis. We believe that certain investors and
analysts use Free Cash Flow to value a business and its underlying assets. The
most comparable IFRS financial measure is cash from operating activities. |
FINANCIAL OBJECTIVES
Financial objectives account for 75% of the
weighting of the overall corporate performance objectives (EBITDA 40%, Revenue
20% and Free Cash Flow 15%). The Compensation Committee sets a threshold, a low,
a target and a stretch value for each financial objective. The payout varies
between 0% and 150% depending on the performance, as illustrated in the table
below.
Target values are set within the financial guidance
ranges provided to the investment community, which ensures that payouts are well
aligned to the performance expectations of our shareholders. A payout exceeding
the target award requires exceptional performance versus market expectations on
these measures and versus other companies in the sector.
OVERALL PERFORMANCE |
THRESHOLD |
|
LOW |
|
TARGET |
|
STRETCH |
|
Payout(1) |
0% |
|
50% |
|
100% |
|
150% |
|
(1) |
The overall performance takes into account
the results and relative weight of each financial objective. Results achieved
between these values are interpolated. |
|
|
BCE Inc.
2015 PROXY CIRCULAR
49 |
9 |
COMPENSATION DISCUSSION & ANALYSIS |
|
6 STRATEGIC IMPERATIVES
The remaining 25% weighting of the overall corporate
objectives is used to recognize the achievements related to the Corporations 6
Strategic Imperatives:
-
Improve customer service
-
Leverage wireline momentum
-
Achieve a competitive cost structure
|
-
Accelerate wireless
-
Invest in broadband
-
Expand Media leadership
|
Progress on the 6 Strategic Imperatives is evaluated
by measuring performance against a set of operating metrics, many of which are
commonly used across the industry. Each strategic imperative carries an equal
weight. The following ranking scale applies and the total out of 36 possible
points is then converted to a result out of 25%:
POINTS |
0 |
1 |
2 |
3 |
4 |
5 |
6 |
Results |
Failed |
Significantly |
Below |
Slightly Below |
Met |
Exceeded |
Stretched |
|
|
Below |
|
|
|
|
|
The cumulative total of points earned for the 6
Strategic Imperatives determines the payout according to the following table:
|
THRESHOLD |
|
TARGET |
|
STRETCH |
|
|
0 POINTS |
|
30 POINTS |
|
36 POINTS |
|
SUM OF POINTS |
(6 X 0 POINTS) |
|
(6 X 5 POINTS) |
|
(6 X 6 POINTS) |
|
Payout(1) |
0% |
|
100% |
|
150% |
|
(1) |
The results achieved between these values are
interpolated. |
The Board and the Compensation Committee believe
that these operating objectives were set for 2014 at an ambitious level but
could be achieved under normal economic and market conditions. Payout at target
may only be achieved by exceeding these operating objectives. Hence, the 2014
results that exceeded the aggregate target for the 6 Strategic Imperatives are a
reflection of the Corporations exceptional execution and delivery on its
operational targets.
2014 CORPORATE PERFORMANCE INDEX
The following table outlines the corporate
objectives and results achieved for 2014.
COMPONENT |
WEIGHTING |
CALCULATED PAYOUT |
2014 TARGET |
2014 RESULTS |
COMMENTS |
EBITDA |
40% |
Payout: 33%
Min 0%
Max 60% |
$7,083 million |
$7,066 million |
Bell reported EBITDA growth of 3.7% for 2014, which
was in line with our financial guidance range but slightly below our
internal targets. |
Revenue |
20% |
Payout: 29%
Min 0%
Max 30% |
$18,653 million |
$18,734 million |
Bell reported revenue growth of 3.5% for 2014, which
was in line with our financial guidance range and exceeded our
internal targets. Bell revenues reflected growth of 6.7% in Wireless,
with the Wireline segment showing a decline of 0.6% year over year. |
Free Cash Flow |
15% |
Payout: 21%
Min 0%
Max 22.5% |
$2,705 million |
$2,744 million |
BCE reported Free Cash Flow at the high end of our
financial guidance range and exceeding our internal targets.
Growth of 6.7% year over year for 2014 was driven
largely by strong EBITDA performance while continuing to invest
more capital in broadband networks, and delivering dividend growth
to shareholders. |
Strategic Imperatives Progress |
25% |
Payout: 21%
Min 0%
Max 37.5% |
various |
N/A |
The Board approves a scorecard of approximately 30
operating metrics to monitor the progress against the
strategic imperatives. Considerable progress was made on each imperative
and expectations were exceeded in most cases. In
addition to the strong performance in the Wireless, Wireline and Media
sectors, strong results were also achieved in the areas of
Investment in Broadband Services, Improve Customer Service and Achieving a
Competitive Cost Structure. Further details may be found under
section 10 entitled President and CEO Compensation. |
Total |
100% |
105 |
|
|
|
The financial results for 2014, along with the
progress made against the 6 Strategic Imperatives, were reviewed by the
Compensation Committee against the set of financial and operating objectives
used for setting annual short-term incentive awards. Based on their assessment,
the Compensation Committee recommended, and the Board approved, a corporate
payout index of 105%.
50
BCE Inc. 2015 PROXY CIRCULAR |
|
|
|
COMPENSATION DISCUSSION & ANALYSIS |
9 |
INDIVIDUAL PERFORMANCE OBJECTIVES
The individual performance component is based on an
assessment of the performance of an executive on two dimensions.
The first dimension is the achievement of results
measured against the pre-determined business unit objectives. At the beginning
of the year, the Compensation Committee reviews the President and
CEOs individual performance goals for that year and recommends them to the
Board for approval. Our President and CEOs goals, as well as those of our other
executive officers, are designed to support the execution of the 6 Strategic
Imperatives and thereby create value for shareholders.
The other dimension is the demonstration of the
leadership attributes required to achieve those results. These include people
leadership attributes that serve to build and leverage talent
and drive team effectiveness, along with strategic leadership attributes that
reinforce the transformation of the business and the execution of the strategy.
At the end of the year, the Compensation Committee
and the independent directors of the Board assess the President and CEOs
performance on both the achievement of results against the predetermined
objectives as well as the demonstration of leadership in the attaining of those
results. Likewise, the President and CEO provides the Compensation Committee
with his assessment of the performance of the other executive officers.
Taking into account all the information provided,
including the recommendations of the President and CEO, the Compensation
Committee makes an informed judgment and recommends for Board approval the
individual performance index (between 0 and 3x) for each of the executive
officers. This multiplier index applies on 30% of the total target bonus only.
In 2014, individual performance indexes for the NEOs ranged from 1.25 x to 3.0
x, with an average index of 2.3x. Combined with the corporate performance factor
of 105%, the 2014 annual short-term incentive awards for our NEOs ranged from
$693,750 to $3,433,500 with an average payout of $1,447,740. Please consult the
individual NEO biographies in sections 10 and 11 for greater detail.
Equity-based compensation |
DSU PLAN
The deferred share unit (DSU) plan is designed to
further align the interests of the executive officers with those of the
shareholders by providing a mechanism for the executive officers to receive
incentive compensation in the form of equity. Executive officers and other key
employees of the Corporation and those of certain subsidiaries may elect to
participate in the DSU plan.
Executive officers can choose to have up to 100% of
their annual short-term incentive award paid in DSUs instead of cash. The award
is converted into DSUs based on the market value of a BCE common share on the
day before the award becomes effective. Vested performance share units (PSUs)
and restricted share units (RSUs) may also be rolled into DSUs at time of
payout. DSUs count towards the minimum share ownership requirements, which are
described under the Share Ownership Requirements section.
DSUs have the same value as BCE common shares. The
number and terms of outstanding DSUs are not taken into account when determining
if and how many DSUs will be awarded under the plan. No vesting conditions are
attached to DSUs; they therefore vest at time of grant.
Dividend equivalents in the form of additional DSUs
are equal in value to dividends paid on BCE common shares and credited to the
participants account on each dividend payment date based on the number of units
in the account as of the dividend record date.
The Compensation Committee may also recommend for
Board approval special awards of DSUs to recognize outstanding achievements or
for reaching certain corporate objectives. There were no such awards made in
2014.
Holders of DSUs cannot settle their DSUs while they
are employed by a company within the BCE group of companies. Once they leave the
BCE group, the Corporation will buy, through a trustee, a number of BCE common
shares on the open market equal to the number of DSUs a participant holds in the
plan, after withholding taxes and any other deductions. These shares are then
delivered to the former employee or to the estate in case of death.
LONG-TERM INCENTIVE PLAN
Our long-term incentive plan is designed to reward
the creation of value for our shareholders while providing a vehicle to attract
and retain talented and skilled executives. The long-term incentive plan also
plays a crucial role in aligning variable compensation with the appropriate risk
time horizon and accountability for long and medium term decisions. Being 100%
equity-based, our long-term incentive plans value to the executive is very much
dependent on increasing share-price performance, which in turn benefits all
shareholders. Furthermore, the PSU component of the long-term incentive plan
rewards the achievement of earnings growth targets that enable BCE to grow its
dividend, which also aligns with shareholders interests. Similar to the 2012
and 2013 grants, the 2014 grants under our long-term incentive plan were
allocated as follows:
|
|
BCE Inc.
2015 PROXY CIRCULAR
51 |
9 |
COMPENSATION DISCUSSION & ANALYSIS |
|
Below are the key terms that apply to each component
of the long-term incentive plan:
ELEMENT |
RSUs |
PSUs |
STOCK OPTIONS |
Shareholder interest alignment |
RSUs align executives and shareholders interests
in share return growth. Time vesting also supports the retention of executives
to better enable the Corporation to execute its long-term strategy. |
PSUs align executives and shareholders interests
in dividend growth and their compensation to the Corporations performance.
Multi-year vesting also supports the retention of executives to better enable
the Corporation to execute its long-term strategy. |
Stock options align executives and shareholders
interests in share price growth and their compensation to the Corporations
performance.
Multi-year vesting also supports the retention of
executives to better enable the Corporation to execute its long-term strategy.
|
Payout Range (as a % of the grant award) |
0% to 100% |
0% to 125% |
No defined payout range, payouts are dependent on
the difference between the grant price and the exercise price. |
Defined limit on annual grant levels |
Yes |
Term |
Three years |
Seven years (10-year maximum under the plan text). |
Vesting type |
Three-year cliff vesting |
Vesting date for 2014 grants |
December 31, 2016 |
February 25, 2017 (three years from the date of
grant). |
Vesting criteria |
Being employed by BCE or Bell on the vesting date. |
Being employed by BCE or Bell on the vesting date.
To achieve 100% vesting, earnings growth must be
sufficient to provide the Board with the ability to increase the dividend by a
target compound annual dividend growth rate over the three-year performance
period while keeping the dividend payout ratio between 65% and 75% of the Free
Cash Flow available to common shareholders. Pro-rated payment is made if the
target is only partially attained. |
Being employed by BCE or Bell on the vesting date. |
Dividend equivalents |
Credited as additional units, at the same rate as
dividends declared on BCE common shares. |
None. |
Methods of payment(1) |
Cash, BCE common shares or DSUs. |
BCE common shares when options are exercised. |
Pricing at time of grant |
Conversion from dollar value to units made using the
volume weighted average of the trading price per common share for the last five
consecutive trading days ending immediately on the last trading day prior to the
effective date of the grant and rounded up to the nearest unit. |
Higher of the volume weighted average of the trading
price per common share of a board lot of common shares traded on the Toronto
Stock Exchange; 1) on the trading day immediately prior to the effective date of
the grant, or if at least one board lot of common shares has not been traded on
such day, then the volume weighted average of the trading price per common share
of a board lot of common shares for the next preceding day for which at least
one board lot was so traded; and 2) for the last five consecutive trading days
ending immediately on the trading day prior to the effective date of the grant. |
Clawback |
The President & CEO and all EVPs s are subject to a
clawback clause detailed under section 9.6 entitled Compensation risk
management. |
Option holders will lose all of their unexercised
options if they engage in prohibited behaviours after they leave our
Corporation. This includes using our confidential information for the benefit of
another employer. In addition, the option holder must reimburse the after-tax
profit realized on exercising any options during the six-month period preceding
the date on which the prohibited behaviour began. |
(1) |
At any time, the Compensation Committee may
require that a participant receive a long-term incentive payment in BCE common
shares or in DSUs as an interim measure to help the participant reach his/her
mandatory share ownership requirement. |
52
BCE Inc. 2015 PROXY CIRCULAR |
|
|
|
COMPENSATION DISCUSSION & ANALYSIS |
9 |
The Compensation Committee may also recommend
special grants to recognize specific achievements or, in some cases, to retain
or motivate executive officers and key employees. For details of special grants,
please refer to section 11 entitled Compensation of Our Named Executive
Officers.
Information on change in control and termination
provisions applicable to stock options can be found under section 11.5 entitled Termination and change-in-control benefits.
The Corporation uses the fair value method of
accounting for equity-based compensation.
PSU PAYOUTS
Since the PSU plans inception in 2011, two payout
cycles have occurred. The 2011 and 2012 PSU grants both vested at 100% as the
earnings level attained during the performance cycles were more than sufficient
to attain the targeted cumulative compound dividend growth rate to maintain the
dividend payout ratio within the policy range of 65%-75%.
The PSU grants prior to 2014 had a maximum payout
level of 100%. The 2014 PSU grants have a payout stretch of 125% to reinforce
the incentive to outperform and reflect current market practices in PSU design.
For further details on each NEOs 2014 PSU award,
see the Summary compensation table on page 64 of this management proxy
circular or refer to the detailed NEO biographies in sections 10 and 11.
SHARE OWNERSHIP REQUIREMENTS
We believe in the importance of substantial share
ownership, and our compensation programs are designed to encourage share
ownership by executive officers. In order to encourage ongoing investment in the
Corporation and to ensure continuous alignment of our executive officers
compensation with our objective of creating value for our shareholders, share
ownership requirements were increased for the President and CEO and EVPs in
2013. These milestones are to be reached 10 years from promotion or hire date.
The following table outlines the current minimum share ownership levels as a
multiple of annual base salary and the associated deadline applicable for each
executive level:
|
MULTIPLE OF BASE SALARY |
POSITION |
5-YEAR TARGET |
(1) |
10-YEAR TARGET |
President and CEO |
7.5x |
|
10x |
EVPs |
3.0x |
|
5x |
(1) |
50% of five-year target must be reached
within three years. |
Direct and indirect holdings of common shares of
BCE, including shares or DSUs received under the following programs, can be used
to reach the minimum share ownership level:
-
DSU plan, described under DSU Plan
-
Employees Savings Plan (ESP), described under
Benefits and Perquisites
-
shares acquired and held by exercising stock options
granted under our stock option plans, described under Long-Term
Incentive Plan
-
shares received and held upon payment of RSUs and
PSUs, described under Long-Term Incentive Plan.
Option grants and unvested equity grants do not
count towards the minimum share ownership level.
Share ownership status is calculated using the
higher of acquisition cost and the current market value at time of review. The
Compensation Committee reviews at least annually the status of compliance with
the share ownership requirements. Concrete measures may be taken if the three-
five- or 10-year targets are missed. These measures include, but are not limited
to, the payment of a portion of the annual short-term incentive award in DSUs
and, when stock options are exercised, the requirement to hold BCE common shares
having a market value equal to a portion of the after-tax financial gain
resulting from the exercise. These measures remain in effect until the target is
reached. As shown in the table below, all of our NEOs have exceeded their
five-year targets and 10-year targets.
Below is the share ownership status for our NEOs as
of March 5, 2015.
|
OWNERSHIP REQUIREMENT |
|
|
PERCENTAGE OF |
|
|
|
|
TOTAL BCE |
|
|
|
|
|
|
|
|
EQUITY |
|
|
|
|
|
|
|
|
OWNERSHIP |
|
|
5-YEAR |
10-YEAR |
|
BASE SALARY |
|
|
VALUE |
(1) |
OWNERSHIP |
TARGET |
TARGET |
NEO |
($) |
YEAR 5 |
YEAR 10 |
($) |
|
IN DSUs |
ACHIEVED |
ACHIEVED |
George A. Cope |
1,400,000 |
7.5x |
10x |
$59,040,972 |
|
95% |
562% |
422% |
Siim A. Vanaselja |
620,000 |
3x |
5x |
$17,237,606 |
|
98% |
927% |
556% |
Wade Oosterman |
750,000 |
3x |
5x |
$35,817,337 |
|
82% |
1,592% |
955% |
Kevin W. Crull |
750,000 |
3x |
5x |
$8,052,854 |
|
88% |
358% |
215% |
Thomas Little |
625,000 |
3x |
5x |
$3,567,076 |
|
91% |
190% |
114% |
(1) |
Estimated using a BCE share price of $55.10. |
|
|
BCE Inc.
2015 PROXY CIRCULAR
53 |
9 |
COMPENSATION DISCUSSION & ANALYSIS |
|
Pension, benefits and perquisites |
PENSION
No change was made to our pension plan in 2014 as it
was well positioned relative to market.
With the exception of Mr. S.A. Vanaselja, all NEOs
participate in the Defined Contribution (DC) pension plan, which has been the
only pension plan available to employees hired since 2004. Mr. S.A. Vanaselja,
who was hired prior to 2004, participates in Bell Canadas Defined Benefit (DB)
pension plan.
All our NEOs are eligible for supplementary
retirement arrangements, except for Mr. Little, who will become eligible in
November 2015. The pension benefits provided to our NEOs are described under
Compensation of Our Named Executive Officers Pension arrangements.
BENEFITS AND PERQUISITES
We believe that offering competitive and flexible
benefits is essential to attract and retain qualified employees. The Corporation
provides the Omniflex benefit program, which gives employees the flexibility to
choose health, life and accident insurance most suited to their individual
needs. The NEOs are provided with additional benefits, mainly relating to
incremental life and accident insurance.
We also offer to all of our employees the
possibility to participate in our ESP. The ESP is designed to support long-term
share ownership and to build greater interest in the growth and success of our
Corporation. Under the ESP, employees can contribute up to 6% of their eligible
earnings to buy BCE common shares. The Corporation contributes $1 for every $3
the employee contributes. The shares purchased with the Corporation
contributions are vested to employees after two years. More information on the
ESP can be found under Compensation of Our Named Executive Officers Employees savings plans
(ESPs).
The NEOs receive a competitive cash allowance for
perquisites.
9.6 Compensation risk management |
Our Risk Advisory Services (Corporate risk
management) and Human Resources groups conducted their annual compensation risk
evaluation process to ensure that such practices do not encourage executives to
take undue risk on behalf of the corporation for personal financial gain.
FIVE-PILLAR FRAMEWORK
As part of the risk-assessment process, the
five-pillar framework developed in 2011 for the purpose of the annual assessment
was used and relevant potential risks were identified for each of the pillars.
The risk factors identified across the five pillars
form the focus of the risk assessment associated with compensation policies and
practices. Each risk factor is considered in the context of specific plan design
characteristics and relevant risk mitigation practices in order to reach a
conclusion on the residual risk exposure.
Our assessment identified no risks associated with our compensation policies
and practices likely to have a material adverse effect on the corporation |
We recognize that long-term growth and value
creation can only be achieved within an acceptable level of risk. We ensure our
compensation policies and practices reward executives for short, medium and
long-term decision making and performance but do not encourage undue risk-taking
or produce excessive compensation levels. We also ensure our policies and
practices reflect best practices in terms of market trends and governance
standards. The following are key risk mitigation policies that are part of the
annual risk assessment and our approach to sound compensation management at BCE.
54
BCE Inc. 2015 PROXY CIRCULAR |
|
|
|
COMPENSATION DISCUSSION & ANALYSIS |
9 |
OVERVIEW OF COMPENSATION AND RISK
GOVERNANCE POLICIES AT BCE
WHAT WE DO |
WHAT WE AVOID |
Use external independent consultants to assess our
executive compensation programs to ensure they are aligned with shareholder and
corporate objectives, best practices and governance principles. |
Maintaining or reducing performance target levels
for incentive plans. Steadily increasing performance levels must be achieved to
realize payouts year after year. |
Incorporate caps on the annual short-term incentive
payouts, medium and long-term incentive grants and executive pension plans to
prevent excessive compensation levels. |
Paying out incentives if they are not commensurate
with performance results. The Board and the Compensation Committee have
discretionary powers to alter incentive payouts when unexpected circumstances
arise. |
Incorporate risk mitigation mechanisms(1)
into incentive programs and compensation policies to minimize the likelihood
that executives will take undue risks to enhance their remuneration. |
Setting performance targets for incentives without
appropriate stress testing. |
Balance short (annual short-term incentive), medium
(RSUs and PSUs) and long-term (stock options) incentives to align compensation
to the risk horizon for each compensation component. |
Offering compensation exceptions to NEOs without
appropriate Board approval. |
Offer a pay mix that emphasizes performance with 80%
of NEO target total direct compensation being at risk and tightly linked to
BCEs performance. |
Offering single trigger change in control (CIC)
rights to our executives(3). |
Enforce an incentive compensation clawback policy
and forfeiture provisions(2). |
Issuing stock option grants below market value and
allowing option grants to be re-priced or forfeited in exchange for options with
a lower strike price. |
Impose material share ownership requirements and
offer the possibility to convert incentive payouts into to DSUs which further
aligns executives interests with those of our shareholders. |
Allowing hedging of the economic exposure of BCE
securities by all insiders, including directors and executives. BCEs
anti-hedging policy prohibits any kind of hedging the effect of which is to
alter the insiders economic interest in securities of BCE, or the insiders
economic exposure to BCE. As share ownership requirements and the long-term
incentive plan align shareholder and executive interests, these restrictions
ensure this alignment is fully maintained. |
Maintain a pre-clearance process for the President
and CEO and all EVPs to protect against insider trading and trading during
blackout periods. |
Ensure that the Compensation Committee is comprised
of independent members to avoid compensation-related conflicts of interest. |
Including unvested and unexercised long term
incentives in share ownership calculations. |
Offer our shareholders an opportunity to provide
input to the Board regarding our executive compensation practices and levels via
our annual Say on Pay advisory vote. |
Guaranteeing variable incentive payouts. |
(1) |
The main risk mitigation mechanisms include:
incorporating a balanced and diversified combination of performance metrics for
incentive plans to protect against one particular metric being promoted at the
expense of overall health of the business, emphasis on long-term incentives with
three year vesting cycles in the executive pay mix to discourage undue
short-term risk-taking and curtailing the use of options (which offer the
greatest leverage to share price fluctuation) so they represent only 14.5% of
NEO total target direct compensation. |
(2) |
The President and CEO as well as all EVPs
have a clawback clause in their employment agreements that provides for the
Corporation, at its discretion, to clawback a portion of cash and equity
compensation awarded to them as well as to obtain reimbursement for a portion of
the gains realized on the exercise of options granted to them after their
appointment. The clawback is enforceable if there is a financial restatement due to gross
negligence, intentional misconduct or fraud during the 24 months preceding the
restatement, and where it is determined that the cash or equity awards paid
would have been lower had the restatement occurred prior to the payment of such
awards.
All stock option holders are subject to a clawback clause if they engage in
prohibited behaviours as described in greater detail in section 9.5 entitled
2014 Compensation Elements under the heading Long-Term Incentive
Plan.
In the event of termination for cause, an individual forfeits all vested and
unvested options and unvested RSU and PSU grants. |
(3) |
The double-trigger CIC policy requires a CIC
and termination for reasons other than for cause or resignation for good reason
for 18 months post CIC. This prevents the Corporation from being obliged to pay
termination benefits during a CIC if an executives employment is not terminated
as part of the CIC. More information can be found in section 11.5 entitled Termination and change-in-control benefits under the
heading Stock Options. |
|
|
BCE Inc.
2015 PROXY CIRCULAR
55 |
9 |
COMPENSATION DISCUSSION & ANALYSIS |
|
9.7 Shareholder return performance
graph |
|
2009 |
2010 |
2011 |
2012 |
2013 |
2014 |
BCE Common Shares |
100 |
129 |
163 |
173 |
197 |
239 |
S&P/TSX Composite Index |
100 |
118 |
107 |
115 |
130 |
144 |
NEO Compensation |
100 |
105 |
104 |
116 |
121 |
124 |
The graph above compares the yearly change in the
cumulative annual total shareholder return on BCE common shares against the
cumulative annual total return on the S&P/TSX Composite Index for the five-year
period ending December 31, 2014, assuming an initial investment of $100 on
December 31, 2009, and quarterly reinvestment of all dividends. Also shown is
the growth rate of the NEOs compensation over the same five-year period.
Compensation is defined as total direct compensation awarded to NEOs, including
salary, annual short-term incentive awards and annualized grants of RSUs, PSUs
and stock options. The graph shows the compensation awarded to our NEOs as
remaining fairly constant and not following the growth of the return on the BCE
common shares or the S&P/TSX Composite Index. However, a large portion of total
compensation is awarded in the form of equity, and the actual payouts related to
those awards are linked more closely to the evolution of the Corporations share
price and dividend growth than is reflected in the graph above.
BCE
BCE total return is based on the BCE common share
price on the Toronto Stock Exchange and assumes the reinvestment of dividends.
S&P/TSX COMPOSITE INDEX
With approximately 95% coverage of the Canadian
equities market, the S&P/TSX Composite Index is the primary gauge for
Canadian-based, Toronto Stock Exchange-listed companies. Such companies include,
among others: BCE, Royal Bank of Canada, Toronto-Dominion Bank, Suncor Energy,
Canadian Natural Resources and Canadian National Railway Company.
56
BCE Inc. 2015 PROXY CIRCULAR |
|
|
|
PRESIDENT AND CEO COMPENSATION |
10 |
10 |
PRESIDENT AND CEO COMPENSATION |
|
George Cope has been President and CEO of BCE and
Bell Canada since July 2008. Having served in public-company CEO roles in the
communications industry for more than 15 years prior to joining Bell in 2005 as
President and COO, Mr. Cope is acknowledged as an innovative telecom strategist
and builder of high-performance teams.
Mr. Cope holds an Honors Business Administration
degree from Western University (and was also awarded an honorary doctorate by
the University in 2013) and serves on the Advisory Board of the universitys
Ivey Business School. In 2014, he was awarded an Honorary Doctor of Laws from
the University of Windsor and was appointed to the Order of Canada.
Mr. Cope is
a Director of Bank of Montreal and past Chair of Bell Aliant Inc.
In 2014, Mr. Copes target direct compensation level
did not change. |
2014 key accomplishments and
determination of annual short-term incentive award |
The Compensation Committee evaluated Mr. Copes
performance for 2014 based on demonstrated leadership behaviours and
comprehensive objectives related to:
-
the evolution of BCEs strategy
-
the execution of BCEs strategy.
Mr. Cope significantly advanced the evolution of
BCEs strategy in 2014:
-
completed the $3.95 billion privatization of Bell
Aliant, supporting Bells strategic imperatives to Leverage Wireline Momentum,
Invest in Broadband Networks and Services, and Achieve a Competitive Cost
Structure. Atlantic Canadas leading communications brand, Bell Aliant has
delivered Fibre to the Home broadband to 1 million locations
-
announced the acquisition of GLENTEL Inc., an
independent national distributor of wireless services through branded locations
such as Wireless Wave and Tbooth Wireless. In addition to 494 Canadian retail
locations, GLENTEL has wireless retail operations in the U.S., Australia and the
Philippines. Following closing of the acquisition, expected in Spring 2015, BCE
will divest 50% of its ownership interest in GLENTEL to Rogers Communications.
Rogers will pay BCE approximately $392 million in cash, resulting in BCEs net
cost of acquiring its retained 50% ownership interest in GLENTEL being reduced
to $202 million
-
executed Bells commitment to broadband network
leadership by deploying a significant number of new broadband mobile LTE sites
across Canada and new fibre capacity for consumer and business services such as
the fast-growing Fibe. With speeds increased by up to 45% nationally, LTE
service covered 86% of the Canadian population by the end of 2014, on track to
deliver 98% coverage by the end of 2015
- won 31 licenses of 700 MHz national spectrum in the
2014 federal spectrum auction and paid the lowest price per MHz-Pop of the
incumbent wireless carriers
- launched innovative new TV applications such as TSN
GO and TMN GO, and a video streaming service CraveTV, enabling subscribers to
watch a vast range of content across multiple devices at home or on the go
- with another record Bell Lets Talk Day, expanded
the national mental health initiative with funding for more leading hospitals
and other institutions to enhance mental health care & access and drive new
research, as well as for grassroots organizations in every region of the country
through the Bell Lets Talk Community Fund. The high-profile Claras Big Ride
for Bell Lets Talk saw national spokesperson Clara Hughes cycle 11,000
kilometres on her epic journey around Canada to spread the anti-stigma message
to communities in every province and territory. Bell was also recognized with
the Gold Award from Excellence Canada for mental health at work
- continued to grow the business in a socially
responsible way: Bell was named one of the Top 50 Socially Responsible
Corporations by Macleans / LActualité / Sustainalytics and one of the Elite 8
Most Engaged Workplaces in North America by Achievers, and was awarded New Grad
Program by Talent Egg, and Best Learning & Development Strategy at the Canadian
HR Awards.
Mr. Cope led the Bell team in its successful
execution of the companys 6 Strategic Imperatives in 2014:
-
posted wireline EBITDA growth was positive in the
last two quarters of 2014, a significant turning point as TV and Internet growth
offset declines in the home phone business
-
led major North American telecom companies with a
wireline EBITDA margin of 37.5%
-
continued to accelerate the wireless market with the
largest proportion of postpaid net additions among incumbents while leading the
major carriers in ARPU growth, EBITDA growth and service margin expansion
-
increased smartphone penetration to 76% of the
postpaid base, supporting increased usage of data services such as Bell Mobile
TV which surpassed 1.5 million customers by the end of the year 29% more than
at the end of 2013
|
|
BCE Inc.
2015 PROXY CIRCULAR
57 |
10 |
PRESIDENT AND CEO COMPENSATION |
|
-
expanded the travel bundle add on feature, making
mobile roaming even more affordable. Customers also now experience faster data
speeds when roaming on 4G LTE networks in the United States (including U.S.
Virgin Islands and Puerto Rico), Austria, France, Hong Kong, the Netherlands,
New Zealand, Peru, Philippines, Portugal, Saudi Arabia, Spain, Switzerland, and
Taiwan
-
increased to five the number of financial
institutions that enable their customers to use Bell Mobility smartphones to
make secure credit purchases at locations that accept contactless payments
-
continued Bells industry-leading investment in
Canadas best broadband mobile and fibre networks, expanding 4G LTE mobile
coverage to 86% of the population and the Fibe TV footprint to more than 5.0
million locations across Ontario and Québec, a million more than at the end of
2014, including market launches in, Gatineau, Kitchener/Waterloo, London,
Sherbrooke, St. Catharines/Niagara and continued expansion in the Montréal,
Toronto and Ottawa regions
-
attracted 45% more Fibe TV subscribers year over
year, bringing the total Fibe TV base to 701,000 at the end of 2014. Four in
five new Fibe TV customers take a three-product bundle of Bell services,
supporting high-speed Internet subscriber growth and a reduction in the decline
in traditional Home Phone service
- expanded Bell Medias position as the leading
broadcaster in Canada with industry-leading viewership, thanks in part to
homegrown programming such as Master Chef, Amazing Race Canada, 19-2 and Saving
Hope, which was the number one Canadian TV show of the Fall season
- launched the CraveTV video on demand service and
signed distribution agreements with Telus, Eastlink and Bell Aliant. Crave TV
has over 10,000 hours of great TV and at $4 a month is an exceptional value
compared to competing services. It is the only Canadian premium video on demand
service to have the off air library of HBO programs
- maintained TSNs position as the number one
specialty TV channel in Canada in 2014 and RDS at number one in Québec. The IIHF
World Junior Championships set viewership records and the Gold medal game was
the most watched hockey game of the 2014/15 season on any network. Launched five
national feeds for TSN (TSN 1, TSN 2, TSN 3, TSN 4, TSN 5) to present the full
range of The Sports Networks leading roster of professional sports content and
enable fans to watch multiple events across the five channels
- improved customer service across all business lines.
Launched two-hour appointment windows for Residential installation and repairs
and introduced Business service appointments in the evenings and on weekends.
Launched new and enhanced online and self-serve options like the mCare App and
the personal bill explainer for Mobility customers. Made significant investments
in customer service support tools, and announced five new customer service call
centres in Canada.
Shareholders benefited from BCEs strong financial
and operational performance, with a 6.0% increase in 2014 common dividends to
$2.47 from $2.33 in 2013. This was BCEs 10th increase to the annual
common share dividend since December 2008, representing growth of 69% over the
period.
58
BCE Inc. 2015 PROXY CIRCULAR |
|
|
|
PRESIDENT AND CEO COMPENSATION |
10 |
2014 ACTUAL PAY MIX
|
2014 |
2013 |
2012 |
|
($) |
($) |
($) |
Salary ($) |
1,400,000 |
1,400,000 |
1,250,000 |
At-Risk Compensation |
|
|
|
Annual Short-Term Incentive Plan ($) |
3,433,500 |
2,891,700 |
3,328,125 |
RSU-Based Awards ($) |
2,937,500 |
2,937,500 |
2,937,500 |
PSU-Based Awards ($) |
1,468,750 |
1,468,750 |
1,468,750 |
Option-Based Awards ($) |
1,468,750 |
1,468,750 |
1,468,750 |
Total At-Risk Compensation ($) |
9,308,500 |
8,766,700 |
9,203,125 |
Pension & Other Compensation ($) |
771,750 |
796,748 |
639,711 |
Total Compensation ($) |
11,480,250 |
10,963,448 |
11,092,836 |
Share ownership and value at risk |
The table below shows the total vested and unvested
BCE equity owned by Mr. Cope as of the date of this circular. His total
ownership as value at risk is $87,243,426, an increase of 26% over last year.
|
OWNERSHIP AND VESTED VALUE |
UNVESTED VALUE |
|
|
|
|
|
|
|
|
|
|
|
|
TOTAL
OWNERSHIP
AND VALUE
AT RISK |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
VESTED |
|
|
|
|
UNVESTED |
|
TOTAL |
HOLDINGS |
SHARES |
DSUs |
OPTIONS |
(1) |
TOTAL VESTED |
PSUs |
RSUs |
OPTIONS |
(1) |
UNVESTED |
Number |
58,592 |
1,012,932 |
356,493 |
|
1,428,017 |
95,329 |
190,657 |
1,109,373 |
|
1,395,359 |
|
|
|
|
|
|
|
|
|
|
|
|
$87,243,426 |
Value(2) |
$3,228,419 |
$55,812,553 |
$5,479,297 |
|
$64,520,269 |
$5,252,628 |
$10,505,201 |
$6,965,328 |
|
$22,723,157 |
|
(1) |
Represents the estimated gain from the
exercise of the underlying options. |
(2) |
Calculated using the closing price of BCEs
common shares on the Toronto Stock Exchange of $55.10. |
|
|
BCE Inc.
2015 PROXY CIRCULAR
59 |
11 |
COMPENSATION OF OUR NAMED EXECUTIVE
OFFICERS |
|
11 |
COMPENSATION OF OUR NAMED
EXECUTIVE OFFICERS |
This section examines the compensation provided in
2014 to our President and CEO, our CFO and our three other most highly
compensated executive officers (based on aggregate compensation excluding
pension benefits).
-
George A. Cope, President and CEO BCE and Bell
Canada
(see detailed compensation discussion in section 10 entitled President and
CEO Compensation)
-
Siim A. Vanaselja, EVP and CFO BCE and Bell Canada
-
Wade Oosterman, President Bell Mobility and Bell
Residential Services & Chief Brand Officer Bell Canada
-
Kevin W. Crull, President Bell Media
-
Thomas Little, President Bell Business Markets
For more information regarding our compensation
philosophy and policies and a discussion of the elements of our compensation
programs, see section 9 entitled Compensation Discussion & Analysis.
|
|
|
Siim Vanaselja leads BCEs financial strategy,
supporting the execution of Bells 6 Strategic Imperatives, our strong capital
markets position and the delivery of ongoing returns to BCE shareholders.
Responsible for BCEs corporate development, Mr.
Vanaselja has overseen several high-profile strategic acquisitions since 2008,
including The Source, CTV, MLSE and Astral, enabling Bells strong growth in the
wireless, media and other markets.
Mr. Vanaselja has held progressively senior
positions at BCE since joining the corporation in February 1994, including CFO
of Bell Canada International. A highly regarded financial executive who has
served on a range of national financial advisory boards, Mr. Vanaselja is a
member of the Institute of Chartered Accountants of Ontario and holds an Honors
Bachelor of Business degree from the Schulich School of Business. He serves as a
Director of TransCanada Corp., Great-West Lifeco Inc., Maple Leaf Sports and
Entertainment Ltd. (MLSE) and Bimcor Inc.
In 2014, Mr. Vanaseljas salary increased by $45,000
to reflect the growth in his responsibilities and market alignment. Mr.
Vanaselja has announced his plans to retire in 2015. He will be succeeded by Mr.
Glen LeBlanc. |
2014 ACTUAL PAY MIX
|
2014 |
2013 |
2012 |
|
($) |
($) |
($) |
Salary ($) |
620,000 |
575,000 |
575,000 |
At-Risk Compensation |
|
|
|
Annual Short-Term Incentive Plan ($) |
827,700 |
791,775 |
934,375 |
RSU-Based Awards ($) |
625,000 |
625,000 |
625,000 |
PSU-Based Awards ($) |
312,500 |
312,500 |
312,500 |
Option-Based Awards ($) |
312,500 |
312,500 |
312,500 |
Total At-Risk Compensation ($) |
2,077,700 |
2,041,775 |
2,184,375 |
Pension & Other Compensation ($) |
734,775 |
446,424 |
471,109 |
Total Compensation ($) |
3,432,475 |
3,063,199 |
3,230,484 |
60
BCE Inc. 2015 PROXY CIRCULAR |
|
|
|
COMPENSATION OF OUR NAMED EXECUTIVE
OFFICERS |
11 |
|
|
|
A top Canadian marketing executive and respected
brand expert, Wade Oosterman oversees Bells national wireless and wireline
consumer businesses and the evolution of one of the countrys most recognized
and trusted brands.
With Mr. Oostermans strategic direction, Bell has
regained its leadership position in the Canadian wireless marketplace and
delivered new competition and choice in residential communications services with
Bells fast-growing Fibe TV and Fibe Internet services. The refreshed Bell brand
developed by Mr. Oosterman is ranked as one of the most valuable in Canada.
Mr. Oosterman holds a Master of Business
Administration degree from the Ivey Business School at Western University. He is
a Director of Ingram Micro Inc. and the Toronto International Film Festival.
In 2014, Mr. Oostermans target direct compensation
level did not change. |
2014 ACTUAL PAY MIX
|
2014 |
2013 |
|
2012 |
|
($) |
($) |
|
($) |
Salary ($) |
750,000 |
750,000 |
|
750,000 |
At-Risk Compensation |
|
|
|
|
Annual Short-Term Incentive Plan ($) |
1,170,000 |
1,201,500 |
|
1,162,500 |
RSU-Based Awards ($) |
875,000 |
875,000 |
|
875,000 |
PSU-Based Awards ($) |
437,500 |
437,500 |
|
437,500 |
Options-Based Awards ($) |
437,500 |
437,500 |
|
437,500 |
RSU-Retention Award ($) |
|
5,000,000 |
(1) |
|
Total At-Risk Compensation ($) |
2,920,000 |
7,951,500 |
|
2,912,500 |
Pension & Other Compensation ($) |
269,422 |
249,533 |
|
215,994 |
Total Compensation ($) |
3,939,422 |
8,951,033 |
|
3,878,494 |
(1) |
One-time special RSU retention grant of
$5,000,000. |
|
|
BCE Inc.
2015 PROXY CIRCULAR
61 |
11 |
COMPENSATION OF OUR NAMED EXECUTIVE
OFFICERS |
|
|
|
|
Kevin Crull leads a Bell Media team focused on
delivering the best Canadian and international media to viewers and listeners
across all platforms.
Under Mr. Crulls leadership, Bell Media has become
Canadas premier conventional, pay and specialty TV, radio and digital company.
He led the integration of Astral with Bell Media, contributing to Bells
enhanced presence in pay and specialty TV, especially in the Québec marketplace
as well as radio and out-of-home advertising. Bell Media properties now reach
87% of all English-language specialty and pay TV viewers and 92% of specialty
and pay TV viewers in Québec.
Mr. Crull holds a Master of Business Administration
degree from the University of San Francisco and a Bachelor degree in Marketing
from Ohio State University. He serves as a Director of the Sick Kids Foundation,
the Globe and Mail and Kensington Capital.
In 2014, Mr. Crulls target direct compensation
level did not change. |
2014 ACTUAL PAY MIX
|
2014 |
2013 |
2012 |
|
($) |
($) |
($) |
Salary ($) |
750,000 |
750,000 |
700,000 |
At-Risk Compensation |
|
|
|
Annual Short-Term Incentive Plan ($) |
1,113,750 |
1,032,750 |
1,137,500 |
RSU-Based Awards ($) |
875,000 |
875,000 |
750,000 |
PSU-Based Awards ($) |
437,500 |
437,500 |
375,000 |
Options-Based Awards ($) |
437,500 |
437,500 |
375,000 |
Total At-Risk Compensation ($) |
2,863,750 |
2,782,750 |
2,637,500 |
Pension & Other Compensation ($) |
305,724 |
315,589 |
285,302 |
Total Compensation ($) |
3,919,474 |
3,848,339 |
3,622,802 |
62
BCE Inc. 2015 PROXY CIRCULAR |
|
|
|
COMPENSATION OF OUR NAMED EXECUTIVE
OFFICERS |
11 |
|
|
|
Thomas Little leads Bell Business Markets, one of
the countrys largest broadband network and communications provider serving
enterprise, government, mid and mass market business customers.
Under Mr. Littles stewardship, Bell Business
Markets has become the Canadian leader in data hosting and cloud computing
services, offering customers access to 25 data hosting centres across the
country.
Mr. Little joined Bell in 2009 as President of Bell
Wholesale with 25 years of leadership experience in technology, venture capital
and finance. He is a Chartered Professional Accountant and a Deans Honor List
graduate of the Ivey Business School at Western University.
Mr. Little received a salary increase of $25,000 in
2014 to reflect market alignment. |
2014 ACTUAL PAY MIX
|
2014 |
2013 |
2012 |
|
($) |
($) |
($) |
Salary ($) |
625,000 |
600,000 |
600,000 |
At-Risk Compensation |
|
|
|
Annual Short-Term Incentive Plan ($) |
693,750 |
781,200 |
784,200 |
RSU-Based Awards ($) |
625,000 |
625,000 |
625,000 |
PSU-Based Awards ($) |
312,500 |
312,500 |
312,500 |
Options-Based Awards ($) |
312,500 |
312,500 |
312,500 |
Total At-Risk Compensation ($) |
1,943,750 |
2,031,200 |
2,034,200 |
Pension & Other Compensation ($) |
104,336 |
101,044 |
92,056 |
Total Compensation ($) |
2,673,086 |
2,732,244 |
2,726,256 |
|
|
BCE Inc.
2015 PROXY CIRCULAR
63 |
11 |
COMPENSATION OF OUR NAMED EXECUTIVE
OFFICERS |
|
11.1 Summary compensation table |
The table below summarizes the compensation of our
NEOs. The NEOs include our President and CEO, our CFO and our three most highly
compensated executive officers ranked by their total compensation in the table
below.
For more information regarding our compensation
philosophy and policies and a discussion of the elements of our compensation
programs, see Compensation Discussion & Analysis and the footnotes to the
table below.
NAME AND PRINCIPAL POSITION |
YEAR |
SALARY |
|
SHARE-BASED
AWARDS |
|
OPTION-BASED
AWARDS |
|
NON-EQUITY
INCENTIVE PLAN
COMPENSATION
(ANNUAL
INCENTIVE
PLANS) |
|
PENSION
VALUE |
|
ALL OTHER
COMPENSATION |
|
TOTAL
COMPENSATION |
($) |
(1) |
($) |
(2)(3) |
($) |
(4) |
($) |
(5) |
($) |
(6) |
($) |
(7) |
($) |
George A. Cope
President and CEO
BCE and Bell Canada |
2014 |
1,400,000 |
|
4,406,250 |
|
1,468,750 |
|
3,433,500 |
|
605,130 |
|
166,620 |
|
11,480,250 |
2013 |
1,400,000 |
|
4,406,250 |
|
1,468,750 |
|
2,891,700 |
|
629,579 |
|
167,169 |
|
10,963,448 |
2012 |
1,250,000 |
|
4,406,250 |
|
1,468,750 |
|
3,328,125 |
|
476,696 |
|
163,015 |
|
11,092,836 |
Siim A. Vanaselja
EVP and CFO
BCE and Bell Canada |
2014 |
620,000 |
|
937,500 |
|
312,500 |
|
827,700 |
|
714,769 |
|
20,006 |
|
3,432,475 |
2013 |
575,000 |
|
937,500 |
|
312,500 |
|
791,775 |
|
426,562 |
|
19,862 |
|
3,063,199 |
2012 |
575,000 |
|
937,500 |
|
312,500 |
|
934,375 |
|
451,659 |
|
19,450 |
|
3,230,484 |
Wade Oosterman
President Bell Mobility
and Bell Residential Services and
Chief Brand Officer Bell Canada |
2014 |
750,000 |
|
1,312,500 |
|
437,500 |
|
1,170,000 |
|
245,889 |
|
23,533 |
|
3,939,422 |
2013 |
750,000 |
|
6,312,500 |
(8) |
437,500 |
|
1,201,500 |
|
225,750 |
|
23,783 |
|
8,951,033 |
2012 |
750,000 |
|
1,312,500 |
|
437,500 |
|
1,162,500 |
|
192,195 |
|
23,799 |
|
3,878,494 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Kevin W. Crull
President Bell Media |
2014 |
750,000 |
|
1,312,500 |
|
437,500 |
|
1,113,750 |
|
213,930 |
|
91,794 |
|
3,919,474 |
2013 |
750,000 |
|
1,312,500 |
|
437,500 |
|
1,032,750 |
|
211,375 |
|
104,214 |
|
3,848,339 |
2012 |
700,000 |
|
1,125,000 |
|
375,000 |
|
1,137,500 |
|
182,574 |
|
102,728 |
|
3,622,802 |
Thomas Little
President Bell Business Markets |
2014 |
625,000 |
|
937,500 |
|
312,500 |
|
693,750 |
|
84,310 |
|
20,026 |
|
2,673,086 |
2013 |
600,000 |
|
937,500 |
|
312,500 |
|
781,200 |
|
81,552 |
|
19,492 |
|
2,732,244 |
2012 |
600,000 |
|
937,500 |
|
312,500 |
|
784,200 |
|
72,514 |
|
19,542 |
|
2,726,256 |
(1) |
Mr. Vanaseljas and Mr. Littles 2014 base
salaries increased from $575,000 to $620,000 and from $600,000 to $625,000,
respectively, to better align their compensation with the compensation offered
to executive officers from out comparator group companies and our
pay-for-performance compensation philosophy. |
(2) |
The following table compares the grant date
fair values used for compensation purposes with the provisions that are recorded
to the Corporations financial statements for the NEO share-based awards. |
|
2014
FEBRUARY 26,2014 TO
DECEMBER 31, 2016 |
2013
FEBRUARY 18, 2013 TO
DECEMBER 31, 2015 |
2013
MARCH 6, 2013 TO
MARCH 5, 2016 |
2012
FEBRUARY 20, 2012 TO
DECEMBER 31, 2014 |
|
GRANT DATE
FAIR VALUE (a) |
ACCOUNTING
FAIR VALUE (b) |
GRANT DATE
FAIR VALUE (a) |
ACCOUNTING
FAIR VALUE (b) |
GRANT DATE
FAIR VALUE (a) |
ACCOUNTING
FAIR VALUE (b) |
GRANT DATE
FAIR VALUE (a) |
ACCOUNTING
FAIR VALUE (b) |
SHARE PRICE |
$47.69 |
$47.85 |
$44.39 |
$45.01 |
$46.57 |
$46.97 |
$39.51 |
$40.07 |
Aggregate Difference |
$30,025 |
$124,415 |
$42,993 |
$123,886 |
Difference per share |
$0.16 |
$0.62 |
$0.40 |
$0.56 |
|
(a) |
The share price at time of grant was equal to
the volume weighted average of the trading price per BCE common share of a board
lot of BCE common shares traded on the Toronto Stock Exchange for the five
consecutive trading days ending on the day prior to the day the grant became
effective. |
|
(b) |
Amortized over the vesting period of the
awards. |
(3) |
The value shown under this column was
allocated as per our compensation plan policy: 50% of the total long-term
incentive plan value in RSUs and 25% of the total long-term incentive plan value
in PSUs. The following table details the amounts awarded under both plans: |
|
2014 |
2013 |
2012 |
|
RSUs |
PSUs |
RSUs |
PSUs |
RSUs |
PSUs |
NEO |
($) |
($) |
($) |
($) |
($) |
($) |
G.A. Cope |
2,937,500 |
1,468,750 |
2,937,500 |
1,468,750 |
2,937,500 |
1,468,750 |
S.A. Vanaselja |
625,000 |
312,500 |
625,000 |
312,500 |
625,000 |
312,500 |
W. Oosterman |
875,000 |
437,500 |
5,875,000 |
437,500 |
875,000 |
437,500 |
K.W. Crull |
875,000 |
437,500 |
875,000 |
437,500 |
750,000 |
375,000 |
T. Little |
625,000 |
312,500 |
625,000 |
312,500 |
625,000 |
312,500 |
64
BCE Inc. 2015 PROXY CIRCULAR |
|
|
|
COMPENSATION OF OUR NAMED EXECUTIVE
OFFICERS |
11 |
(4) |
BCE started to use the binomial valuation
method for the evaluation of compensation in 2007. The binomial model provides
flexibility in the determination of the theoretical value of options for
assumptions regarding parameters such as dividends, vesting period and exercise
before expiry. The binomial model is a recognized method for the valuation of
stock options of a company that has a high dividend yield. The accounting fair
value for the purposes of the financial statements is also calculated using a
binomial methodology, which meets requirements under International Financial
Reporting Standards, but uses slightly different assumptions. Most important,
the dividend is calculated assuming a dividend growth commensurate with the
corporations dividend growth strategy instead of a fixed dividend. The main
assumptions used in determining compensation fair value and financial statements
value are described in the following table: |
|
2014 |
2013 |
2012 |
|
|
FINANCIAL |
|
FINANCIAL |
|
FINANCIAL |
KEY ASSUMPTIONS |
FAIR VALUE |
STATEMENTS |
FAIR VALUE |
STATEMENTS |
FAIR VALUE |
STATEMENTS |
Vesting Period |
3 years |
3 years |
3 years |
3 years |
3 years |
3 years |
Dividend Yield |
5.03% |
5.16% |
5.1% |
5.2% |
5.33% |
5.4% |
Expected Volatility |
15.3% |
15.3% |
17.7% |
17.7% |
21.0% |
21.0% |
Risk-Free Interest Rate |
1.92% |
1.52% |
1.50% |
1.25% |
1.27% |
1.36% |
Total Exercise Period |
7 years |
7 years |
7 years |
7 years |
7 years |
7 years |
Expected Life |
7 years |
4.5 years |
4.5 years |
4.5 years |
4.5 years |
4.5 years |
Binomial Value |
$3.82 |
$2.37 |
$3.72 |
$2.81 |
$4.12 |
$3.13 |
|
The difference between the grant date fair value used for compensation
purposes and the fair value used for accounting purposes for the options granted
during the year ended December 31, 2014, is approximately $1.45 less per option
or $1,126,876 for the 777,162 stock options awarded to the NEOs on February 26,
2014. In 2013, the difference between the grant date fair value for compensation
purposes and the fair value used for accounting purposes for the options granted
during the year ended December 31, 2013, was approximately $0.91 less per option
or $726,217 for the 798,054 stock options awarded to the NEOs on February 18,
2013. The accounting fair value is amortized over the vesting period of the
awards. In 2012, the difference between the stock option award grant date fair
value and the accounting fair value of the stock option award as at December 31,
2012, was approximately $0.99 less per option or $698,342 for the 705,402 stock
options awarded to the NEOs on February 20, 2012. The accounting fair value is
amortized over the vesting period of the awards. |
(5) |
This column includes only the annual
short-term incentive awards paid to the NEOs. |
(6) |
As described under Pension arrangements, for
all NEOs except for Mr. Vanaselja this represents the employer contribution for
each of the three most recently completed years for the different defined
contribution arrangements and related effects on the value of the executive
officers SERP account when applicable. For Mr. Vanaselja, it represents the
service cost evaluated for an additional year of service. |
(7) |
All Other Compensation is comprised of the
following components: |
|
|
|
|
|
CORPORATION |
|
|
|
|
|
|
|
PERQUISITES AND |
|
CONTRIBUTION |
|
|
|
|
|
|
|
OTHER PERSONAL |
|
UNDER EMPLOYEES |
|
|
|
TOTAL ALL OTHER |
|
|
|
BENEFITS |
(a) |
SAVINGS PLAN |
(b) |
OTHER |
(c) |
COMPENSATION |
NAME |
YEAR |
|
($) |
|
($) |
|
($) |
|
($) |
G.A. Cope |
2014 |
|
122,373 |
|
28,000 |
|
16,247 |
|
166,620 |
|
2013 |
|
122,373 |
|
28,000 |
|
16,796 |
|
167,169 |
|
2012 |
|
122,373 |
|
25,000 |
|
15,642 |
|
163,015 |
S.A. Vanaselja |
2014 |
|
|
|
12,400 |
|
7,606 |
|
20,006 |
|
2013 |
|
|
|
11,500 |
|
8,362 |
|
19,862 |
|
2012 |
|
|
|
11,500 |
|
7,950 |
|
19,450 |
W. Oosterman |
2014 |
|
|
|
15,000 |
|
8,533 |
|
23,533 |
|
2013 |
|
|
|
15,000 |
|
8,783 |
|
23,783 |
|
2012 |
|
|
|
15,000 |
|
8,799 |
|
23,799 |
K.W. Crull |
2014 |
|
64,171 |
|
15,000 |
|
12,623 |
|
91,794 |
|
2013 |
|
77,874 |
|
15,000 |
|
11,340 |
|
104,214 |
|
2012 |
|
77,874 |
|
14,000 |
|
10,854 |
|
102,728 |
T. Little |
2014 |
|
|
|
12,500 |
|
7,526 |
|
20,026 |
|
2013 |
|
|
|
12,000 |
|
7,492 |
|
19,492 |
|
2012 |
|
|
|
12,000 |
|
7,542 |
|
19,542 |
|
(a) |
For Mr. Cope, it consists mainly of a
perquisite allowance in the amount of $120,000 for years 2014, 2013, 2012. For
Mr. Crull, it is essentially composed of a perquisite allowance of $45,500 and
of tuition fees in the amount of $15,000 for 2014 and $30,000 each of years 2013
and 2012. Perquisites and other personal benefits that in aggregate are worth
less than $50,000 or 10% of the total annual base salary of a NEO for the
financial year are not included. |
|
(b) |
Under the
Employees Savings Plan, employees, including NEOs, can contribute up to
6% of their eligible earnings to buy BCE common shares. The Corporation
contributes $1 for every $3 that the employee contributes. In order to
encourage share ownership over the longer term, participants may not
withdraw any common shares bought with their own contributions under the
plan for a two-year period to allow employer contributions to vest. The
amounts shown include both vested and unvested employer contributions. |
|
(c) |
For all NEOs, this column includes mainly
company-paid life insurance premiums and gross-up payments. |
(8) |
Includes a one-time special RSU retention
grant of $5,000,000. |
|
|
BCE Inc.
2015 PROXY CIRCULAR
65 |
11 |
COMPENSATION OF OUR NAMED EXECUTIVE
OFFICERS |
|
11.2 Incentive plan awards |
OUTSTANDING UNEXERCISED OPTION-BASED
AWARDS AND UNVESTED SHARE-BASED AWARDS
The following table includes all unexercised
option-based awards and all share-based awards outstanding at the end of the
financial year ended December 31, 2014. Refer to section 9.5 entitled 2014
Compensation elements under the heading Long-Term Incentive Plan for
key features of the plans.
NAME |
OPTION-BASED AWARDS |
SHARE-BASED AWARDS |
|
NUMBER OF SECURITIES
UNDERLYING UNEXERCISED OPTIONS |
|
|
|
|
|
|
|
|
|
|
|
MARKET |
MARKET |
|
|
|
|
|
|
|
NUMBER |
OR PAYOUT |
OR PAYOUT |
|
|
|
|
|
|
|
OF SHARES |
VALUE OF |
VALUE OF |
|
|
|
|
|
|
VALUE OF |
OR UNITS |
SHARE-BASED |
SHARE-BASED |
|
|
|
|
OPTION |
|
UNEXERCISED |
OF SHARES |
AWARDS THAT |
AWARDS NOT |
|
|
|
TOTAL |
EXERCISE |
OPTION |
IN-THE-MONEY |
THAT HAVE |
HAVE NOT |
PAID OUT OR |
GRANT |
VESTED |
NOT VESTED |
OPTIONS |
PRICE(1) |
EXPIRATION |
OPTIONS(3) |
NOT VESTED |
VESTED(4) |
DISTRIBUTED(4) |
DATE |
(#) |
(#) |
(#) |
($) |
DATE(2) |
($) |
(#) |
($) |
($) |
G.A. Cope |
2014-02-26 |
0 |
384,490 |
384,490 |
47.90 |
2021-02-25 |
2,068,556 |
206,821 |
$11,019,449 |
$60,893,033 |
|
2013-02-18 |
0 |
394,826 |
394,826 |
44.47 |
2020-02-17 |
3,478,417 |
|
|
|
|
2012-02-20 |
0 |
356,493 |
356,493 |
39.73 |
2019-02-19 |
4,830,480 |
|
|
|
S.A. Vanaselja |
2014-02-26 |
0 |
81,807 |
81,807 |
47.90 |
2021-02-25 |
440,122 |
44,006 |
$2,344,615 |
$17,743,821 |
|
2013-02-18 |
0 |
84,006 |
84,006 |
44.47 |
2020-02-17 |
740,093 |
|
|
|
|
2012-02-20 |
0 |
75,850 |
75,850 |
39.73 |
2019-02-19 |
1,027,768 |
|
|
|
W. Oosterman |
2014-02-26 |
0 |
114,529 |
114,529 |
47.90 |
2021-02-25 |
616,166 |
180,304 |
$9,606,578 |
$27,442,631 |
|
2013-02-18 |
0 |
117,608 |
117,608 |
44.47 |
2020-02-17 |
1,036,126 |
|
|
|
|
2012-02-20 |
0 |
106,190 |
106,190 |
39.73 |
2019-02-19 |
1,438,875 |
|
|
|
K.W. Crull |
2014-02-26 |
0 |
114,529 |
114,529 |
47.90 |
2021-02-25 |
616,166 |
61,607 |
$3,282,428 |
$7,166,170 |
|
2013-02-18 |
0 |
117,608 |
117,608 |
44.47 |
2020-02-17 |
1,036,126 |
|
|
|
|
2012-02-20 |
0 |
91,020 |
91,020 |
39.73 |
2019-02-19 |
1,233,321 |
|
|
|
T. Little |
2014-02-26 |
0 |
81,807 |
81,807 |
47.90 |
2021-02-25 |
440,122 |
44,006 |
$2,344,615 |
$4,276,590 |
|
2013-02-18 |
0 |
84,006 |
84,006 |
44.47 |
2020-02-17 |
740,093 |
|
|
|
|
2012-02-20 |
0 |
75,850 |
75,850 |
39.73 |
2019-02-19 |
1,027,768 |
|
|
|
(1) |
The exercise price is the price at which a
common share may be purchased when an option is exercised. Effective June 6,
2007, shareholders approved that the exercise price be the higher of the volume
weighted average of the trading price per BCE common share of a board lot of BCE
common shares traded on the Toronto Stock Exchange: (i) on the trading day prior
to the day the grant becomes effective or, if at least one board lot of BCE
common shares has not been traded on such day, then the volume weighted average
for the next preceding day for which at least one board lot was so traded; and
(ii) for the five consecutive trading days ending on the trading day prior to
the day the grant becomes effective. For options granted prior to June 6, 2007, the exercise price was equal to
the closing price of a board lot of common shares of BCE on the last trading day
before the grant came into effect. |
(2) |
The term of any option may not exceed 10
years from the effective date of the grant. Since 2011, options have been
granted with a seven-year term. The Compensation Committee can always recommend
and the Board approve another option term at time of grant as long as the
maximum 10-year expiry date is respected. |
(3) |
The value of unexercised in-the-money options
is calculated using the closing price of a board lot of common shares of BCE on
the Toronto Stock Exchange on December 31, 2014, i.e. $53.28, less the exercise
price of those options. |
(4) |
The value of the outstanding share units is
calculated using the closing price of a board lot of common shares of BCE on the
Toronto Stock Exchange on December 31, 2014, i.e. $53.28, times the number of
share units held by the employee in the RSU, PSU and DSU plans, as applicable.
For RSUs, PSUs and DSU plans, it also includes dividends credited in the form of
additional RSUs (including the December 15, 2014 declared dividend) |
Incentive plan awards value vested
or earned during the year |
The following table summarizes option-based awards
and share-based awards that vested during 2014 as well as annual short-term
incentive awards earned during 2014. Refer to section 9.5 entitled 2014
Compensation elements under the heading Long-Term Incentive Plan and
Annual Short-Term Incentive Awards sections for the key features of the
plans.
|
|
|
|
|
|
|
|
|
NON-EQUITY INCENTIVE |
|
|
OPTION-BASED AWARDS |
SHARE-BASED AWARDS |
|
PLAN COMPENSATION |
|
|
|
|
|
|
|
|
VALUE VESTED |
|
VALUE EARNED |
|
|
|
|
VESTED OPTIONS |
|
VALUE ON |
|
DURING THE |
|
DURING THE |
|
|
|
|
DURING 2014 |
|
VESTING DATE |
(1) |
YEAR |
(2) |
YEAR |
(3) |
NAME |
VESTING DATE |
|
(#) |
|
($) |
|
($) |
|
($) |
|
G.A. Cope |
2014-02-20 |
|
323,171 |
|
$6,924,013 |
|
$6,924,013 |
|
$3,433,500 |
|
S.A. Vanaselja |
2014-02-20 |
|
76,220 |
|
$1,473,225 |
|
$1,473,225 |
|
$827,700 |
|
W. Oosterman |
2014-02-20 |
|
91,464 |
|
$2,062,540 |
|
$2,062,540 |
|
$1,170,000 |
|
K.W. Crull |
2014-02-20 |
|
91,464 |
|
$1,767,882 |
|
$1,767,882 |
|
$1,113,750 |
|
T. Little |
|
|
|
|
$1,743,225 |
|
$1,743,225 |
|
$693,750 |
|
(1) |
The RSUs (and the RSUs credited in lieu of
dividends on those RSUs) and PSUs granted on February 20, 2012, vested in full
on December 31, 2014. On the vesting date, the closing price of a board lot of
common shares of BCE Inc. on the Toronto Stock Exchange was $53.28. |
(2) |
For all NEOs, on vesting day the closing
price of a board lot of common shares of BCE Inc. on the Toronto Stock Exchange
was $53.28. |
(3) |
These amounts are the same as those included
in the Summary Compensation Table under the column Non-Equity Incentive Plan
Compensation (Annual Incentive Plans) and include the entire 2014 annual
short-term incentive awards paid in cash and/or in DSUs. |
66
BCE Inc. 2015 PROXY CIRCULAR |
|
|
|
COMPENSATION OF OUR NAMED EXECUTIVE
OFFICERS |
11 |
The following table shows the increase of the
ownership in the Corporation by each NEO by electing to reinvest all or a
portion of their annual short-term incentive payouts in DSUs, for the last three
years.
|
2014 |
2013 |
2012 |
|
% ELECTED |
|
VALUE |
(1) |
% ELECTED |
|
VALUE |
(1) |
% ELECTED |
|
VALUE |
(1) |
NAME |
IN DSUs |
|
($) |
|
IN DSUs |
|
($) |
|
IN DSUs |
|
($) |
|
G.A. Cope |
|
|
$0 |
|
|
|
$0 |
|
|
|
$0 |
|
S.A. Vanaselja |
|
|
$0 |
|
|
|
$0 |
|
100% |
|
$934,375 |
|
W. Oosterman |
100% |
|
$1,170,000 |
|
100% |
|
$1,201,500 |
|
100% |
|
$1,162,500 |
|
K.W. Crull |
50% |
|
$556,875 |
|
|
|
$0 |
|
|
|
$0 |
|
T. Little |
50% |
|
$346,875 |
|
|
|
$0 |
|
|
|
$0 |
|
(1) |
The effective date of the grants of DSUs for
the 2014 annual short-term incentive was February 19, 2015, and the share price
used for conversion was $55.63. For the 2013 annual short-term incentive, the
effective date of the grant of the DSUs was February 19, 2014, and the share
price used for conversion was $47.14. For the 2012 annual short-term incentive,
the effective date of the grant of the DSUs was February 12, 2013, and the share
price used for conversion was $44.23. For all grants, the share price is equal
to the closing share price of a board lot of common shares of BCE on the Toronto
Stock Exchange on the last trading day before the grant comes into effect. |
The following table shows the increase of the
ownership in the Corporation by each NEO by electing to reinvest all or a
portion of their 2012 RSU and PSU payouts in DSUs.
|
2012 RSUs |
|
2012 PSUs |
TOTAL |
|
|
% ELECTED |
|
VALUE |
|
% ELECTED |
|
VALUE |
|
VALUE |
|
NAME |
IN DSUs |
|
($) |
|
IN DSUs |
|
($) |
|
($) |
|
G.A. Cope |
|
|
$0 |
|
|
|
$0 |
|
$0 |
|
S.A. Vanaselja |
|
|
$0 |
|
|
|
$0 |
|
$0 |
|
W. Oosterman |
100% |
|
$1,375,006 |
|
100% |
|
$687,534 |
|
$2,062,540 |
|
K.W. Crull |
50% |
|
$589,284 |
|
50% |
|
$294,658 |
|
$883,941 |
|
T. Little |
|
|
$0 |
|
|
|
$0 |
|
$0 |
|
The following table lists the number and net value
of options that were exercised during 2014 by each NEO.
|
|
|
|
|
NET VALUE |
|
|
NUMBER OF SHARES |
|
|
|
REALIZED UPON |
|
NAME |
ACQUIRED ON EXERCISE |
|
EXERCISE PRICE |
|
EXERCISE |
(1) |
G.A. Cope |
323,171 |
|
47.92 |
|
3,906,685 |
|
S.A. Vanaselja |
|
|
|
|
|
|
W. Oosterman |
|
|
|
|
|
|
K.W. Crull |
|
|
|
|
|
|
T. Little |
|
|
|
|
|
|
(1) |
This amount is calculated based on the
differences between the exercise price and the market price of the shares at the
time of exercise. |
The stock option plan was established in 1999. It is
available to officers and other employees of the Corporation and its
subsidiaries who in the opinion of the Compensation Committee have demonstrated
the capacity for contributing in a substantial measure to the successful
performance of the Corporation. The number of shares issuable to insiders, at
any time, under the stock option plan and all equity-based compensation
arrangements of BCE cannot exceed 10% of issued and outstanding shares; and the
number of shares issued to insiders, within any one-year period, under all
security-based compensation arrangements of BCE cannot exceed 10% of issued and
outstanding shares.
In 2014, 2,915,361 options were granted under the
stock option plan, representing 0.3% of issued and outstanding shares, none of
which were vested as of December 31, 2014.
Under the terms of the stock option plan, the
Compensation Committee establishes the option period, which shall not exceed ten
years after the effective date of the grant. It also establishes the vesting
schedule for each grant. Since 2011, options have been granted with a seven-year
term and three-year cliff vesting.
Options are not assignable by the optionee, except
to the optionees estate upon the optionees death.
Under the terms of the stock option plan, the
Compensation Committee has the discretion to establish vesting provisions,
exercise schedules or termination provisions at the time of grant of new options
or later on with respect to any outstanding option, without shareholder
approval. However, the Compensation Committee may not, without shareholder
approval:
-
increase the number of common shares that can be
issued under the stock option plan
-
reduce the strike price of an outstanding option
(including a cancellation and regrant of an option, constituting a reduction of
the exercise price of an option)
-
extend the expiry date of an outstanding option or
amend the stock option plan to permit the grant of an option with an expiry date
beyond the maximum term allowed under the stock option plan
-
change the provisions relating to the
transferability of options except if the transfer is for normal
estate-settlement purposes
|
|
BCE Inc.
2015 PROXY CIRCULAR
67 |
11 |
COMPENSATION OF OUR NAMED EXECUTIVE
OFFICERS |
|
-
make amendments to eligible participants that may
permit the introduction of non-employee directors on a discretionary basis
-
make amendments to provide for other types of
compensation through equity issuance, unless the change results from application
of the anti-dilution provisions of the stock option plan.
In 2014, amendments of a housekeeping nature were
made to the stock option plan. These amendments did not adversely alter or
impair the terms or conditions of the options previously granted to an optionee
under the plan. Shareholder approval was not required for these amendments.
Additional information regarding the stock option plan can be found in section
9.5 entitled 2014 Compensation Elements under the heading Long-Term
Incentive Plan and in section 11.5 entitled Termination and
change-in-control benefits under the heading Stock Options.
Securities authorized for issuance
under equity compensation plans |
|
NUMBER OF SECURITIES |
|
|
|
NUMBER OF SECURITIES REMAINING AVAILABLE
FOR FUTURE ISSUANCE UNDER EQUITY
COMPENSATION PLANS EXCLUDING SECURITIES
REFLECTED IN COLUMN (A)
(#)
(C) |
|
|
TO BE ISSUED |
|
WEIGHTED AVERAGE |
|
|
|
UPON EXERCISE OF |
|
EXERCISE PRICE OF |
|
|
|
OUTSTANDING OPTIONS, |
|
OUTSTANDING OPTIONS, |
|
|
|
WARRANTS AND RIGHTS |
|
WARRANTS AND RIGHTS |
|
|
|
(#) |
|
($) |
|
|
NAME |
(A) |
|
(B) |
|
|
Equity compensation plans approved by security
holders |
|
|
|
|
|
|
Equity compensation plans not approved by security
holders(1) |
9,278,190 |
|
43 |
|
35,292,963 |
(2) |
Total |
9,278,190 |
|
43 |
|
35,292,963 |
|
(1) |
The key features of the stock option plan are
provided under section 9 entitled Compensation Discussion & Analysis Long-Term
Incentive Plan. |
(2) |
This number includes 12,411,790 BCE common shares
issuable pursuant to employee subscriptions under the BCE Inc. ESPs (1970) and
(2000). |
The following table sets out the number of
securities issued and issuable under each of the Corporations security-based
compensation arrangements and the number of BCE common shares underlying
outstanding options and percentages represented by each calculated over the
number of BCE common shares outstanding as at December 31, 2014.
|
|
|
|
|
|
|
|
|
COMMON |
|
|
|
|
COMMON |
|
|
|
COMMON |
|
|
|
SHARES UNDER |
|
|
|
|
SHARES |
|
|
|
SHARES ISSUED |
|
|
|
OUTSTANDING |
|
|
|
|
ISSUABLE |
(1) |
|
|
TO DATE |
|
|
|
OPTIONS |
|
|
|
|
NUMBER |
|
% |
(2) |
NUMBER |
|
% |
(2) |
NUMBER |
|
% |
(2) |
BCE Inc. Long-Term Incentive (Stock Option) Program
(1999)(3) |
32,159,363 |
(4) |
3.8 |
|
17,534,542 |
|
2.1 |
|
9,278,190 |
(5) |
1.1 |
|
Employees Savings Plans (1970) and (2000) |
10,135,275 |
(6) |
1.2 |
|
19,953,464 |
|
2.4 |
|
N/A |
|
N/A |
|
(1) |
This number excludes BCE common shares issued
to date and represents the aggregate of BCE common shares underlying outstanding
options and BCE common shares remaining available for future grants of options
and subscriptions under the ESPs. |
(2) |
Outstanding BCE common shares as at December
31, 2014 = 840,330,353. |
(3) |
As at the date of this circular, there were
31,310,884 common shares issued and issuable under the Stock Option Program
(1999), which represented 3.7% of the then outstanding common shares. |
(4) |
Out of a maximum number of issuable BCE
common shares of 50,000,000 under the Stock Option Program (1999) after
deduction of 306,095 common shares transferred to and issued or issuable under
the BCE Inc. Replacement Stock Option Plan (Plan of Arrangement 2000). |
(5) |
As at the date of this circular, there were
11,153,196 common shares underlying outstanding options, which represented 1.3%
of the then outstanding common shares. |
(6) |
Out of an aggregate maximum
number of issuable BCE common shares of 20,000,000 under the ESPs (1970) and
(2000). |
The table below summarizes the dilution, overhang
and burn rates for the stock option plan as of December 31 of each year.
|
2014 |
|
2013 |
|
2012 |
|
Dilution(1) |
1.1 |
% |
1.0 |
% |
0.7 |
% |
Overhang(2) |
3.8 |
% |
4.3 |
% |
4.4 |
% |
Burn Rate(3) |
0.3 |
% |
0.4 |
% |
0.3 |
% |
(1) |
(Total options outstanding) ÷ (total common
shares outstanding). |
(2) |
(Total options available for issue + options
outstanding) ÷ (total common shares outstanding). |
(3) |
(Total options granted during the fiscal
year) ÷ (total common shares outstanding). |
68
BCE Inc. 2015 PROXY CIRCULAR |
|
|
|
COMPENSATION OF OUR NAMED EXECUTIVE
OFFICERS |
11 |
11.3 Employees savings plans (ESPs) |
ESPs are designed to encourage our employees and
those of our participating subsidiaries to own shares of the Corporation. In
most instances, employees who have completed at least six months of service and
who do not control directly or indirectly 5% or more of the outstanding common
shares of BCE can choose to have up to 12% of their annual eligible earnings
withheld through regular payroll deductions to buy BCE common shares. The
employer contributes up to 2% of the employees annual eligible earnings to the
plan. Two ESPs are in place: the BCE Inc. Employees Savings Plan (1970) (the
1970 ESP) and the BCE Inc. Employees Savings Plan (2000) (the 2000 ESP).
The 2000 ESP, which is intended for employees whose principal employment is in
the United States, is not currently in use and thus, there are no accumulated
shares currently issued under this plan. The terms of both ESPs are
substantially similar.
The trustee of the ESPs buys BCE common shares for
the participants on the open market, by private purchase or from BCE (issuance
of treasury shares). The price of the shares purchased by the trustee on the
open market or by private purchase is equal to the value paid by the trustee for
such shares. The price for treasury shares (if any) purchased from BCE is equal
to the weighted average prices of the shares purchased by the trustee on the
open market and by private purchase (if any) in the week immediately preceding
the week in which the purchase is made from BCE. The purchase price for treasury
shares may not be below the market price of the securities, as established
pursuant to the plan. In 2014, shares were purchased on the open market for
employer contributions and no shares were issued from treasury to fill employee
contributions.
The number of shares that may be issued under the
ESPs to insiders of a participating company, within any one-year period, under
all security-based compensation arrangements of BCE, may not exceed 10% of all
issued and outstanding BCE common shares. Participation in the ESPs is not
assignable.
The 1970 ESP supports long-term share ownership and
builds greater interest in the growth and success of our Corporation. Shares
purchased with employee contributions may not be withdrawn from the plan for a
two-year period to allow employer contributions to vest. Shares are then
purchased with the employer contributions and become available to the
participant. Upon departure from the Corporation, except upon involuntary
termination, retirement or death, the unvested employer contributions are
forfeited.
Under the terms of the ESPs, the Board has the
authority to modify the ESPs without shareholder approval to introduce changes
such as a change in the termination provisions, housekeeping changes (such as to
correct an immaterial inconsistency or clerical error or omission), or a change
deemed necessary or desirable to comply with applicable law or regulatory
requirements.
However, the Board may not, without shareholder
approval:
-
amend the limit on employee contribution
-
amend the offering period to more than 27 months
-
introduce a discount purchase price
-
amend the maximum Corporation contribution
-
increase the number of common shares issuable
pursuant to the ESPs, or
-
allow for a potential dilution associated with the
ESPs, together with all other security-based compensation arrangements, of more
than 10% of outstanding common shares of the Corporation.
In light of the transaction related to the purchase
by BCE of all outstanding shares of Bell Aliant Inc not already held by BCE (the
Transaction) and pursuant to the authority granted to the Board under the 1970
ESP, effective January 3, 2015, the Board, upon recommendation of the MRCC made
the following amendments to the 1970 ESP:
-
Participants enrolled under Bell Aliant ESPs were
automatically enrolled in the 1970 ESP;
-
All shares of BCE held by the participants under the
Bell Aliant ESPs were transferred into such participants 1970 ESP account.
No changes were made to the 2000 ESP and no other
changes beyond those discussed above were made to the 1970 ESP in 2014. These
changes did not require shareholder approval.
11.4 Pension arrangements |
DEFINED CONTRIBUTION ARRANGEMENTS
THE DC BASIC PLAN IS THE SUM OF:
-
Employee contributions: Employee may contribute up
to a maximum of 4% of pensionable earnings, subject to the Income Tax
Act (Canada) (ITA) limit.
-
Employer contributions: Employer contributes 4% of
pensionable earnings and matches the first 2% of employee contributions, for a
maximum of 6%.
a. |
Registered
DC Plan Arrangement |
|
The Registered DC Plan Arrangement is a component of
the Bell Plan. Under this arrangement, each participant has the responsibility
to choose how to invest the contributions made in his or her registered account
and the rate of return depends on his or her choice. Employee contributions,
Corporation contributions and any investment returns are immediately vested. The
sum of employee and employer contributions is limited to the maximum allowed
under the ITA for registered pension plans. |
|
|
BCE Inc.
2015 PROXY CIRCULAR
69 |
11 |
COMPENSATION OF OUR NAMED EXECUTIVE
OFFICERS |
|
b. |
DC Notional Account |
|
When the sum of employee and employer contributions
in any given year reaches the limit prescribed under the ITA, contributions stop
being deducted from the employees pay and deemed employer contributions start
to accumulate in his or her DC Notional Account. The notional account is
credited monthly at the rate of return of an actively managed fund called the
Bimcor Balanced Fund. This notional account accumulates until termination,
retirement or death, at which point it is paid in cash to the employee or
beneficiary. |
DEFINED CONTRIBUTION SUPPLEMENTARY
EXECUTIVE RETIREMENT PLAN (DC SERP)
All EVPs, including NEOs, hired or appointed to an
officer position on or after January 1, 2005, are eligible for benefits under
the DC SERP after having served as an officer for at least five years. These
supplemental arrangements consist of the application of a multiplier to employer
contributions accumulated in their accounts under the DC Basic Plan (Registered
DC Plan Arrangement and DC Notional Account) while serving as an officer.
Once an executive officer becomes eligible for
benefits under the DC SERP, a multiplier varying from 1.25 upon reaching 45
points (age and years of service) to 3.0 upon reaching 80 points is applied to
employer contributions (DC Basic Plan). An executive officer may therefore
accumulate while an officer (through employer contributions and the related
multiplier) up to a maximum of 18% of his or her pensionable earnings plus
credited investment returns.
The additional amount attributable to DC SERP equals
the multiplier times:
-
the employers contributions accumulated in their
accounts under the DC Basic Plan; less
-
the employers contributions accumulated in their
accounts under the DC Basic Plan at the date they became officers.
The Board may grant additional years of service,
additional employer contributions or both, through a special arrangement.
Pensionable earnings include base salary and annual
short-term incentive awards, whether they are paid in cash or DSUs. The entire
cost is paid by the Corporation for the DC SERP, and this benefit is payable in
a lump sum at termination, death or retirement. The DC SERP, by its nature, does
not include any indexation provision.
The following table shows amounts from all the
Corporations defined contribution arrangements applicable for the NEOs subject
to this pension arrangement.
|
|
|
BALANCE AS OF |
|
|
|
NON- |
|
BALANCE AS OF |
|
|
NAME OF THE |
|
DECEMBER 31, 2013 |
|
COMPENSATORY |
(1) |
COMPENSATORY |
(2) |
DECEMBER 31, 2014 |
|
EXECUTIVE |
ARRANGEMENT |
|
($) |
|
($) |
|
($) |
|
($) |
|
G.A. Cope(3) |
DC Basic Plan |
(5) |
2,106,557 |
|
257,502 |
|
373,326 |
|
2,737,385 |
|
|
DC SERP |
(6) |
2,493,526 |
|
347,628 |
|
648,938 |
|
3,490,092 |
|
|
Total |
|
4,600,083 |
|
605,130 |
|
1,022,264 |
|
6,227,477 |
|
W. Oosterman |
DC Basic Plan |
(5) |
818,715 |
|
117,090 |
|
135,146 |
|
1,070,951 |
|
|
DC SERP |
(6) |
763,183 |
|
128,799 |
|
208,726 |
|
1,100,708 |
|
|
Total |
|
1,581,898 |
|
245,889 |
|
343,872 |
|
2,171,659 |
|
K.W. Crull |
DC Basic Plan |
(5) |
977,089 |
|
106,965 |
|
174,686 |
|
1,258,740 |
|
|
DC SERP |
(6) |
817,029 |
|
106,965 |
|
244,500 |
|
1,168,494 |
|
|
Total |
|
1,794,118 |
|
213,930 |
|
419,186 |
|
2,427,234 |
|
T. Little(4) |
DC Basic Plan |
(5) |
298,793 |
|
84,310 |
|
52,981 |
|
436,084 |
|
|
DC SERP |
|
0 |
|
0 |
|
0 |
|
0 |
|
|
Total |
|
298,793 |
|
84,310 |
|
52,981 |
|
436,084 |
|
(1) |
Employer contribution in 2014 for the
different DC arrangements. |
(2) |
Employee contribution and investment return
for the DC Basic Plan, and investment return for the DC SERP. |
(3) |
In conjunction with his appointment as
President and COO of Bell Canada in January of 2006 and to recognize the level
of seniority at which he joined the Corporation, Mr. Cope was credited five
years of service and $180,000 of notional employer contributions in his DC
Notional Account (included under DC Basic Plan in the above table) through a
special arrangement. |
(4) |
Mr. Little will become eligible for his DC
SERP benefits in November 2015. |
(5) |
DC Basic Plan includes the Registered DC Plan
Arrangement and the DC Notional Account. |
(6) |
As of December 31, 2014, these NEOs were
eligible for the following SERP multipliers: |
EXECUTIVE |
AGE |
|
SERVICE |
|
POINTS |
|
MULTIPLIER |
|
G.A. Cope |
53.4 |
|
14.1 |
(a) |
67.5 |
|
2.35 |
x |
W. Oosterman |
54.2 |
|
8.4 |
|
62.6 |
|
2.10 |
x |
K.W. Crull |
50.4 |
|
9.8 |
|
60.2 |
|
2.00 |
x |
(a) |
Includes five years of service granted upon
hire through a special arrangement. |
70
BCE Inc. 2015 PROXY CIRCULAR |
|
|
|
COMPENSATION OF OUR NAMED EXECUTIVE
OFFICERS |
11 |
DEFINED BENEFIT ARRANGEMENTS
DB BASIC PLAN
For each year of pensionable service from January 1,
1987, under the DB Basic Plan, the amount of annual pension payable to Mr.
Vanaselja from age 65 shall be equal to the sum of:
i. |
1.0% of the Years Maximum Pensionable Earnings
of the year (YMPE); and |
ii. |
1.7% of the officers average annual pay during the
best 60 consecutive months of pensionable earnings (AAPE) in excess of the YMPE. |
a. |
Registered DB Plan Arrangement |
|
The Registered DB Plan Arrangement is a component of
the Bell Plan. This arrangement is calculated using the AAPE in which the
officers compensation produces the highest average. However, it is limited to
the maximum allowed under the ITA for registered pension plans. Benefits are
partially indexed every year to increases in the Consumer Price Index, subject
to a maximum of 4% per year. |
b. |
Excess DB Pension |
|
The excess pension is the pension amount that
exceeds the ITA limit on registered pension plans. The entire cost is paid by
the Corporation.
This benefit is payable only upon retirement or
death after age 55 and is not subject to any deductions for government benefits
or other offset amounts. Benefits are also partially indexed every year to
increases in the Consumer Price Index, subject to a maximum of 4% per year. |
DEFINED BENEFIT SUPPLEMENTARY
EXECUTIVE RETIREMENT PLAN (DB SERP)
All executive officers, including NEOs, hired or
appointed to an officer position on or before December 31, 2004, are eligible
for benefits under the DB SERP. The executive officer receives 1.5 years of
pensionable service for every year he or she serves as an officer. Retirement
eligibility is based on the executive officers age and years of service. The Board may credit additional years of
service towards retirement eligibility, pension calculation or both, through a
special DB SERP arrangement. The DB SERP is a non-contributory arrangement.
In general, an executive officer is eligible to
receive DB SERP benefits when he or she reaches one of the following:
-
at least age 55, and the sum of age and service is
at least 85
-
at least age 60, and the sum of age and service is
at least 80
-
age 65 and has 15 years of service.
Pensions are calculated based on pensionable service
and pensionable earnings. Pensionable earnings include base salary and annual
short-term incentive awards, up to a maximum of the target value, whether they
are paid in cash or DSUs. The average of the executive officers best
consecutive 36 months of pensionable earnings is used to calculate his or her
pension.
An executive officer may receive up to a maximum of
70% of his or her average pensionable earnings as total pension benefits under
the DB Basic Plan and DB SERP. Pensions are payable for life. Surviving spouses
receive about 60% of the pension that was payable to the executive officer.
Pension payments are partially indexed every year to increases in the Consumer
Price Index, subject to a maximum of 4% per year.
In addition to the results in the following table,
the executive officers receive a retirement allowance equal to one years base
salary when they retire under DB SERP provisions. This is not included in their
pensionable earnings.
SPECIAL DEFINED BENEFIT ARRANGEMENT
(DB SA)
From time to time, the Board may grant a DB SA that
would become payable to NEOs if they were to retire before being eligible for
their DB SERP. This benefit can be granted to compensate for any gaps between
the DB Basic Plan and the DB SERP in certain circumstances.
The following table shows information from all the
Corporations defined benefit arrangements for the active NEO subject to this
pension arrangement.
|
|
|
ANNUAL BENEFITS PAYABLE |
|
ACCRUED |
|
|
|
NON- |
|
ACCRUED |
|
|
NUMBER OF |
|
|
|
|
|
OBLIGATION AT |
|
COMPENSATORY |
|
COMPENSATORY |
|
OBLIGATION AT |
|
|
YEARS CREDITED |
|
AT YEAR END |
(1) |
AT AGE 65 |
(2) |
START OF YEAR |
(3) |
CHANGE |
(4) |
CHANGE |
(5) |
YEAR END |
(6) |
EXECUTIVE |
SERVICE (#) |
|
($) |
|
($) |
|
($) |
|
($) |
|
($) |
|
($) |
|
S.A. Vanaselja |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
DB Basic Plan(7) |
20.9 |
|
301,699 |
|
484,298 |
|
4,783,897 |
|
175,009 |
|
1,563,263 |
|
6,522,169 |
|
DB SERP & DB SA(8) |
30.8 |
(9) |
229,741 |
|
315,633 |
|
3,733,838 |
|
539,760 |
|
893,118 |
|
5,166,716 |
|
Total |
|
|
531,440 |
|
799,931 |
|
8,517,735 |
|
714,769 |
|
2,456,381 |
|
11,688,885 |
|
(1) |
Annual benefits payable at year end
represents the pension payable under the DB SA and under the DB Basic Plan
assuming the final average earnings as of December 31, 2014. The immediate
pensions illustrated in this table are under the joint & survivor option. |
(2) |
Annual benefits payable at age 65 represents
the pension payable under the DB SERP and under the DB Basic Plan assuming the
final average earnings as of December 31, 2014 is fixed and the NEO continues to
work up to age 65. The pensions illustrated in this table are under the joint &
survivor option. |
(3) |
Accrued obligation at start of year is
performed using the assumptions in the financial statement as of the plan
measurement date (December 31, 2013). The accrued obligation excludes the
retirement cash allowance equal to one years base salary payable upon
retirement pursuant to the DB SERP. |
(4) |
The compensatory change for 2014 represents
the current service cost evaluated for an additional year of service and his
increase in salary in 2014. |
(5) |
The non-compensatory change represents the
impact of the discount rate (from 4.9% to 4.0%) and the change of YMPE
(established and revised annually by the government and used for the purposes of
the Canada/Québec Pension Plan) on accrued obligation. |
(6) |
Accrued obligation at year end is calculated
using the following key assumptions: discount rate of 4.0% and increase in base
salary of 2.50% annually. The accrued obligation excludes the retirement cash
allowance equal to one years base salary payable upon retirement pursuant to
the DB SERP. |
(7) |
The DB Basic Plan includes the Registered DB
Plan Arrangement and the Excess DB Pension. |
(8) |
Mr. Vanaselja is eligible for DB SERP
benefits if he retires on or after age 60. If his employment terminates or is
severed before age 60, his annual pension will be equal to a percentage of
pensionable earnings corresponding to 35% at age 55 plus 3.5% per additional
year of age under his DB SA. |
(9) |
The number of years of credited service for
calculating total pension benefits for DB SERP at December 31, 2014 was 30.8
years, which includes 20.9 years of actual service and an additional 9.9 years
that was credited to Mr. Vanaselja under the Corporations policy, pursuant to
which 1.5 years of service is credited for every year of actual service while
acting as an officer. |
|
|
BCE Inc.
2015 PROXY CIRCULAR
71 |
11 |
COMPENSATION OF OUR NAMED EXECUTIVE
OFFICERS |
|
11.5 Termination and
change-in-control benefits |
This section describes the standard provisions
applicable to our different equity-based plans in the event of a termination of
and NEOs employment or a change in control. The Compensation Committee has the
authority to depart from these standard provisions at the time an option, an RSU
or a PSU is granted.
STOCK OPTIONS
EVENT |
|
Voluntary resignation |
All non-vested options are forfeited on the event
date. Vested options can be exercised for one year following the event date (without exceeding the original expiry date).
At the end of the one-year period, all outstanding options are forfeited. |
Termination for cause |
All vested and unvested options are forfeited on the
event date. |
Termination without cause (other than following a change in control) |
Continued vesting and right to exercise the stock
options conditional to the employee conforming to non-competition, non-solicitation and confidentiality covenants for
the duration of the vesting and exercise period. |
Retirement(1) |
Continued vesting and right to exercise the stock
options conditional to the employee conforming to non-competition, non-solicitation and confidentiality covenants for
the duration of the vesting and exercise period. |
Death |
All non-vested options vest on the event date.
Vested options can be exercised by the estate for one year following the event date (without exceeding the original expiry
date). After the one-year period, all outstanding options are forfeited. |
Change in control |
If the employment of an option holder is terminated
by the Corporation (as determined by the Board) other than for cause or by the option holder for good reason within 18
months of a change in control, unvested options can be exercised for a period of 90 days from the date of termination. |
(1) |
Retirement is defined as an employee retiring
from the Corporation with at least 55 years of age and 10 years of service, or
at least 60 years of age. |
RSUs AND PSUs
EVENT |
RSUs |
PSUs |
Voluntary resignation |
All outstanding unvested grants are forfeited on the
event date. |
Termination for cause |
All outstanding unvested grants are forfeited on the
event date. |
Termination without cause (other than following a
change in control) |
Continued vesting until the end of the vesting
period conditional on the employee conforming to non-competition,
non-solicitation and confidentiality covenants for the duration of the period. |
Continued vesting until the end of the performance
period conditional to the employee conforming to non-competition,
non-solicitation and confidentiality covenants for the duration of the period.
To be paid on actual performance criteria results
achieved by the Corporation at the end of the performance period. |
Retirement(1) |
Continued vesting until the end of the vesting
period conditional on the employee conforming to non-competition,
non-solicitation and confidentiality covenants for the duration of the period. |
Continued vesting until the end of the performance
period conditional to the employee conforming to non-competition,
non-solicitation and confidentiality covenants for the duration of the period.
To be paid on actual performance criteria results
achieved by the Corporation at the end of the performance period. |
Death |
Immediate vesting and payment of outstanding grants. |
Immediate vesting of outstanding grants using, for
determination of the vesting percentage, period-to-date results and results at
target for the remainder of the period. |
Change in control |
If employment is terminated by the Corporation other
than for cause or by the employee for good reason within 18 months of a change
in control (as determined by the Board), unvested RSUs and PSUs will become
fully vested and payable within 90 days from the date of termination. |
(1) |
Retirement is defined as an employee retiring
from the Corporation with at least 55 years of age and 10 years of service, or
at least 60 years of age. |
72
BCE Inc. 2015 PROXY CIRCULAR |
|
|
|
COMPENSATION OF OUR NAMED EXECUTIVE
OFFICERS |
11 |
Estimated payments for named
executive officers upon termination of employment or change in control |
The two tables below show the incremental payments
that would be made to our President and CEO and other NEOs in the event of
termination of their employment or a change in control. Amounts were calculated
as if termination had occurred on December 31, 2014.
GEORGE A. COPE
The terms applicable in the event of different
termination scenarios, which were agreed upon on Mr. Copes appointment as
President and CEO, are described in the table below.
|
|
|
2014 |
ADDITIONAL |
|
|
|
|
|
|
|
NOTICE |
|
SHORT-TERM |
PENSION |
|
|
|
STOCK |
|
|
|
PERIOD(1) |
SEVERANCE(2) |
AWARD |
BENEFITS(3) |
PERQUISITES(4) |
RSUs(5) |
PSUs(5) |
OPTIONS(6) |
TOTAL |
|
EVENT |
($) |
($) |
($) |
($) |
($) |
($) |
($) |
($) |
($) |
BENEFITS(4) |
Termination without cause (other than following a change in control) |
|
9,019,825 |
(7) |
1,897,083 |
240,000 |
|
|
|
11,156,908 |
24-month
extension |
Termination for cause |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Voluntary resignation |
466,667 |
|
|
|
40,000 |
|
|
|
506,667 |
4-month |
|
|
|
|
|
|
|
|
|
extension |
Long-term disability (LTD)(8) |
|
9,019,825 |
(7) |
1,897,083 |
240,000 |
|
|
|
11,156,908 |
Until age 65 |
Death |
|
|
|
|
|
7,346,280 |
3,673,169 |
10,377,453 |
21,396,902 |
|
Resignation for good reason(9) |
|
9,019,825 |
(7) |
1,897,083 |
240,000 |
|
|
10,377,453 |
21,534,361 |
24-month |
|
|
|
|
|
|
|
|
|
extension |
Termination without cause following a change in control(9) |
|
|
|
|
|
|
|
|
|
|
(1) |
In case of voluntary resignation, Mr. Cope
must provide the Corporation with written notice of four months. The Corporation
may waive such period but remains responsible for paying Mr. Copes base salary
and maintaining his benefits coverage and perquisite allowance during the
four-month period. |
(2) |
The 24-month severance is calculated using
Mr. Copes annual base salary in effect at time of termination and average
annual short-term incentive award for the two years preceding the year of
termination. Mr. Copes average annual short-term incentive award for 2012 and
2013 was $3,109,913. Severance is payable in equal installments over a 12-month
period, without interest. |
(3) |
Amount includes 24 months of employer
contributions (6%, corresponding to the contribution level in effect prior to
termination) under the DC arrangement of the pension plan using base salary in
effect upon termination of employment and average annual short-term incentive
award for the two years preceding the year of termination. This additional
pension value will be payable in 12 monthly instalments without interest. Amount
also includes additional pension value for the recognition of two years of age
and service (total of 4 points impacting the SERP multiplier), as if Mr. Cope
had remained employed during such 24-month period, such amount being payable
within 30 days following termination. Refer to section 11.4 entitled Pension
arrangements for more information on the DC arrangement of the pension plan. In
case of LTD, Mr. Cope will cease participation in the Corporations pension plan
and SERP as of the date of deemed resignation. Refer to footnote (1) above for
information on LTD. |
(4) |
Upon a termination event other than
termination for cause, LTD and voluntary resignation, all benefits and
perquisites will be maintained for 24 months except the following: short- and
long-term disability plans, vacation, parking, security system and IT support.
Outplacement services will also be provided as per the policy for executives. In
the event of alternate employment within the 24-month period, all benefits and
perquisites will cease immediately. Upon LTD, Mr. Cope will receive LTD benefits
in accordance with the Corporations LTD plan up to age 65 and 24 months of
perquisites. |
(5) |
If Mr. Cope conforms to the Corporations
non-competition, non-solicitation and confidentiality restrictive covenants
until the end of the respective performance periods, he will be eligible for
continued vesting on his RSUs and his PSUs. As of December 31, 2014, Mr. Cope
had the following holdings under both plans evaluated using the closing price of
a board lot of common shares of BCE on the Toronto Stock Exchange on December
31, 2014, of $53.28. Accelerated vesting in case of death was also calculated
using the same price. |
|
|
DECEMBER 31, 2014 |
PLAN |
NUMBER OF UNITS HELD |
VALUE |
RSUs |
137,881 |
$7,346,280 |
PSUs |
68,941 |
$3,673,169 |
(6) |
If Mr. Cope conforms to the Corporations
non-competition, non-solicitation and confidentiality restrictive covenants
until the expiry date, he will be eligible for continued vesting and will have
the right to exercise his stock options granted in 2012, 2013 and 2014 until
their expiry date. In case of death or termination following a change in
control, the value of the accelerated options is calculated using the closing
price of a board lot of common shares of BCE on the Toronto Stock exchange on
December 31, 2014, of $53.28. Refer to section 11.2 entitled Incentive plan
awards for complete details on outstanding stock options for Mr. Cope. |
(7) |
Annual short-term incentive award for the
year of termination to be prorated for the period worked and paid as if
individual and corporate results were met at 100%. The actual amount of annual
short-term incentive awarded for 2014 is disclosed in the Summary Compensation
Table. |
(8) |
Thirty days after becoming totally disabled,
Mr. Cope is deemed to have resigned from his position and becomes eligible to
receive termination payments and perquisite allowance identical to those
applicable in case of termination without cause. He will receive benefits and
payments under the Corporations LTD plan until age 65 (continuation of health
care benefits and payment of two-thirds of base salary). Stock options, RSUs and
PSUs will be treated in accordance with the terms of the plan applicable to LTD
which provides for continued participation. |
(9) |
The provisions applicable to a resignation
for good reason or a termination following a change in control are the same as
those applicable to any termination without cause, except with regards to the
provisions applicable to his stock options. Under Mr. Copes agreement,
resignation for good reason may only take place during the two years following a
change in control (defined as acquisition of more than 50% of the common shares
of Bell Canada or BCE by takeover bid, merger, amalgamation, sale of business or
otherwise) if (i) Mr. Cope is assigned duties inconsistent with a CEO position
or (ii) there is a material reduction in Mr. Copes compensation. |
|
|
BCE Inc.
2015 PROXY CIRCULAR
73 |
11 |
COMPENSATION OF OUR NAMED EXECUTIVE
OFFICERS |
|
The payments and benefits described in the table on
the previous page (with the exception of the Notice Period column) are subject
to Mr. Copes compliance with the 12-month non-competition (in Canada),
non-solicitation and non-disparagement provisions of his agreement and to the
confidentiality provisions of his agreement, which are not limited in time. A
breach of these contractual provisions will not only result in the cancellation
of the above payments and benefits but also in a reimbursement by Mr. Cope to
the Corporation of the payments and benefits already received. Furthermore, all
of his vested and unvested stock options will be forfeited and any option gain
made within 12 months following his termination will also have to be reimbursed
to the Corporation.
Upon termination, Mr. Copes stock options, PSUs and
RSUs will be treated in accordance with the terms of the plans under which they
have been granted. If he becomes totally disabled, his stock options, PSUs and
RSUs will be treated in accordance with the terms of the plans applicable to LTD
rather than those applicable upon resignation.
If the Corporation needs to restate its financial
statements due to gross negligence, intentional misconduct or fraud on the part
of Mr. Cope during the 24 months preceding the restatement, and it is determined
that cash or equity awards paid to Mr. Cope would have been lower than awards
actually awarded or received had the restatement occurred prior to the payment
of such award (Restated Amounts), the Board will have the right to:
-
require him to reimburse the portion of any cash or
vested incentive compensation awarded to him after July 11, 2008 (date of
appointment as President and CEO) in excess of the restated amounts, net of tax
and transaction costs
-
cancel the portion of unvested cash or equity
compensation awards, cash bonuses or deferred compensation granted to him after
July 11, 2008 in excess of the Restated Amounts, and
-
require him to reimburse any gain realized by him
from the exercise of options granted to him after July 11, 2008 in excess of the
Restated Amounts, net of tax and transaction costs.
To the extent permitted by law, the Corporation will
pay for Mr. Copes legal fees should a dispute with respect to the above
clawback policy occur.
OTHER NAMED EXECUTIVE OFFICERS
The table below shows the incremental payments that
would be made to our NEOs other than our President and CEO in the event of
different termination events. Amounts were calculated as if termination had
occurred on December 31, 2014.
|
|
|
|
|
|
|
|
STOCK |
|
OTHER |
|
|
|
|
|
SEVERANCE |
(1) |
RSUs |
(2) |
PSUs |
(3) |
OPTIONS |
(4) |
PAYMENTS |
(5) |
TOTAL |
|
|
EVENT |
($) |
|
($) |
|
($) |
|
($) |
|
($) |
|
($) |
|
S.A. Vanaselja(6) |
Termination without cause (other than following a change in control) |
1,860,000 |
|
|
|
|
|
|
|
|
|
1,860,000 |
|
|
Termination for cause |
|
|
|
|
|
|
|
|
|
|
|
|
|
Voluntary resignation |
|
|
|
|
|
|
|
|
|
|
|
|
|
Death |
|
|
1,563,077 |
|
781,538 |
|
2,207,983 |
|
|
|
4,552,598 |
|
|
Termination without cause in the 18 months following a change in control |
1,860,000 |
|
|
|
|
|
2,207,983 |
|
|
|
4,067,983 |
|
W. Oosterman(7) |
Termination without cause (other than following a change in control) |
2,250,000 |
|
|
|
|
|
|
|
|
|
2,250,000 |
|
|
Termination for cause |
|
|
|
|
|
|
|
|
|
|
|
|
|
Voluntary resignation |
|
|
|
|
|
|
|
|
|
|
|
|
|
Death |
|
|
8,512,435 |
|
1,094,143 |
|
3,091,167 |
|
|
|
12,697,745 |
|
|
Termination without cause in the 18 months following a change in control |
2,250,000 |
|
|
|
|
|
3,091,167 |
|
|
|
5,341,167 |
|
K.W. Crull(8) |
Termination without cause (other than following a change in control) |
3,000,000 |
|
|
|
|
|
|
|
300,000 |
|
3,300,000 |
|
|
Termination for cause |
|
|
|
|
|
|
|
|
|
|
|
|
|
Voluntary resignation |
|
|
2,188,285 |
|
1,094,143 |
|
2,269,447 |
|
300,000 |
|
5,851,875 |
|
|
Death |
|
|
2,188,285 |
|
1,094,143 |
|
2,885,613 |
|
|
|
6,168,041 |
|
|
Termination without cause in the 18 months following a change in control |
3,000,000 |
|
|
|
|
|
2,885,613 |
|
300,000 |
|
6,185,613 |
|
T. Little |
Termination without cause (other than following a change in control) |
1,875,000 |
|
|
|
|
|
|
|
|
|
1,875,000 |
|
|
Termination for cause |
|
|
|
|
|
|
|
|
|
|
|
|
|
Voluntary resignation |
|
|
|
|
|
|
|
|
|
|
|
|
|
Death |
|
|
1,563,077 |
|
781,538 |
|
2,207,983 |
|
|
|
4,552,598 |
|
|
Termination without cause in the 18 months following a change in control |
1,875,000 |
|
|
|
|
|
2,207,983 |
|
|
|
4,082,983 |
|
74
BCE Inc. 2015 PROXY CIRCULAR |
|
|
|
COMPENSATION OF OUR NAMED EXECUTIVE
OFFICERS |
11 |
(1) |
Even though there are no formal agreements
between Mr. Vanaselja and Mr. Little and the Corporation, a severance indemnity
equal to 18 months of base salary and annual short-term incentive award at
target has been estimated based on their seniority and years of service. For
Messrs. Oosterman and Crull, this represents the severance indemnity payable in
accordance with their respective employment agreement, as detailed in footnotes
(7) and (8) below. Messrs. Vanaselja, Oosterman, Crull and Little do not have
special severance provisions in the event of a termination without cause
following a change in control, and such termination would therefore trigger the
provisions set forth for termination without cause, if any. |
(2) |
Conforming to the Corporations
non-competition, non-solicitation and confidentiality restrictive covenants
until the end of the vesting period will render the individual eligible for
continued vesting of RSUs. As of December 31, 2014, our NEOs had the following
holdings, evaluated using the closing price of a board lot of common shares of
BCE on the Toronto Stock Exchange on December 31, 2014, of $53.28, under the RSU
plan. Accelerated vesting resulting from death was also calculated using the
same price: |
|
NUMBER |
VALUE AS OF |
NAME |
OF UNITS HELD |
DECEMBER 31, 2014 |
S.A. Vanaselja |
29,337 |
$1,563,077 |
W. Oosterman |
159,768 |
$8,512,435 |
K.W. Crull |
41,071 |
$2,188,285 |
T. Little |
29,337 |
$1,563,077 |
(3) |
Conforming to the Corporations
non-competition, non-solicitation and confidentiality restrictive covenants
until the end of the performance period will render the individual eligible for
continued vesting of PSUs. As of December 31, 2014, our NEOs had the following
holdings, evaluated using the closing price of a board lot of common shares of
BCE on the Toronto Stock Exchange on December 31, 2014 of $53.28, under the PSUs
plan. Accelerated vesting resulting from death was also calculated using the
same price: |
|
NUMBER |
VALUE AS OF |
NAME |
OF UNITS HELD |
DECEMBER 31, 2014 |
S.A. Vanaselja |
14,669 |
$781,538 |
W. Oosterman |
20,536 |
$1,094,143 |
K.W. Crull |
20,536 |
$1,094,143 |
T. Little |
14,669 |
$781,538 |
(4) |
Conforming to the Corporations
non-competition, non-solicitation and confidentiality restricted covenants until
the stock option expiry date will render the individual eligible for continued
vesting and rights to exercise the stock options granted in 2011, 2012, 2013 and
2014 until their expiry. In case of death or termination following a change in
control, the value of the accelerated options is calculated using the closing
price of a board lot of common shares of BCE on the Toronto Stock exchange on
December 31, 2014 of $53.28. Refer to section 11.2 entitled Incentive Plan
Awards for complete details on outstanding stock options for our NEOs. |
(5) |
For Mr. Crull, this represents the estimated
costs of relocating from Toronto to the United States, which will be reimbursed
by the Corporation in the event of a termination without cause or resignation in
accordance with his employment agreement, as detailed under footnote (3) above. |
(6) |
As per his pension arrangement, Mr. Vanaselja
is eligible for benefits under the DB SERP if his employment terminates or is
severed before he reaches age 60. His annual pension will be equal to a
percentage of pensionable earnings corresponding to 35% at age 55 plus 3.5% per
additional year of age. In case of death, a reduced pension will be granted to
his surviving spouse. |
(7) |
Mr. Oostermans employment agreement dated
July 3, 2006, provides for the payment of a severance indemnity equal to 18
months of his base salary and annual short-term incentive award at target in
effect at the time of termination if his employment is terminated by the
Corporation other than for cause. This payment is subject to Mr. Oostermans
compliance with the 12-month non-competition (in Canada) and release provisions
of his employment agreement. |
(8) |
In light of his appointment to the position
of COO of CTVglobemedia Inc., which became effective on November 1, 2010, Mr.
Crulls agreement, dated January 26, 2005 and amended on October 25, 2005 and
May 7, 2007, was further amended on September 30, 2010. Mr. Crulls compensation
was not modified as a result of that amendment. Mr. Crulls employment agreement
provides for the payment of a severance indemnity equal to 24 months of his base
salary and annual short-term incentive award at target in effect at the time of
termination if his employment is terminated by the Corporation other than for
cause. This payment is subject to Mr. Crulls compliance with the 12-month
non-competition (in Canada) and release provisions of his employment agreement.
In the event of termination without cause or voluntary resignation, the
Corporation will reimburse pre-approved relocating costs from Toronto to the
United States within nine months of termination. In addition, the vesting of
RSUs, PSUs and stock options will continue for a 24-month period or until the
options expiry date if earlier, in accordance with the vesting schedule
attached to each grant of RSUs, PSUs and stock options. Following the end of the
24-month period, vested options will be exercisable for 30 days. |
|
|
BCE Inc.
2015 PROXY CIRCULAR
75 |
12 |
OTHER IMPORTANT INFORMATION |
|
12 |
OTHER IMPORTANT INFORMATION |
12.1 Interest of informed persons in
material transactions |
To the best of our knowledge, there were no current
or nominated directors or executive officers or any associate or affiliate of a
current or nominated director or executive officer with a material interest in
any transaction since the commencement of our most recently completed financial
year or in any proposed transaction that has materially affected us or would
materially affect us or any of our subsidiaries.
12.2 Personal loans to directors and
officers |
The Corporation and its subsidiaries have not
granted loans or extended credit to any current or nominated directors or
executive officers or to individuals who have held these positions during the
last fiscal year, or to any of their associates, and to this extent we are
compliant with the prohibition under the Sarbanes-Oxley Act.
12.3 Canadian ownership and control
regulations |
Since 1993, the Telecommunications Act and
associated regulations (Telecom Regulations) have governed Canadian ownership
and control of Canadian telecommunications carriers. Bell Canada and other
affiliates of BCE that are Canadian carriers are subject to this Act. In 2012,
amendments to the Telecommunications Act largely eliminated the foreign
ownership restrictions for any carrier that, with its affiliates, has annual
revenues from the provision of telecommunications services in Canada that
represent less than 10% of the total annual revenues from the provision of these
services in Canada, as determined by the CRTC. However, given that Bell Canada
and its affiliates exceed this 10% threshold, they remain subject to the
pre-existing Canadian ownership and control restrictions, which are detailed
below.
Under the Telecommunications Act, in order
for a corporation to operate as a Canadian common carrier, the following
conditions have to be met:
-
Canadians own at least 80% of its voting shares
-
at least 80% of the members of the carrier companys
board of directors are Canadian
-
the carrier company is not controlled by
non-Canadians.
In addition, where a parent company (Carrier holding
company) owns at least 66 2/3% of the voting shares of the carrier company, the
Carrier holding company must have at least 66 2/3% of its voting shares owned by
Canadians and must not be controlled by non-Canadians. BCE is a Carrier holding
company. The Telecom Regulations give certain powers to the CRTC and to Canadian
carriers and Carrier holding companies to monitor and control the level of
non-Canadian ownership of voting shares to ensure compliance with the
Telecommunications Act. Accordingly, BCE, which controls Bell Canada and
other Canadian carriers, must satisfy the following conditions:
-
Canadians own at least 66 2/3% of its voting shares
-
it is not controlled by non-Canadians.
The powers under the Telecom Regulations include the
right to:
-
suspend the voting rights attached to shares
considered to be owned or controlled by non-Canadians
-
refuse to register a transfer of voting shares to a
non-Canadian
-
force a non-Canadian to sell his or her voting
shares.
However, in our case, there is an additional control
restriction under the Bell Canada Act. Prior approval by the CRTC is
necessary for any sale or other disposal of Bell Canadas voting shares unless
BCE retains at least 80% of all Bell Canada voting shares.
Similarly, the Canadian ownership rules under the
Broadcasting Act for broadcasting licensees, such as Bell ExpressVu, Bell
Media and Bell Canada (in its capacity as the licensee of Bell Fibe TV
distribution systems in Ontario and Québec) generally mirror the rules for
Canadian owned and controlled common carriers under the Telecommunications
Act by restricting allowable foreign investments in voting shares at the
licensee operating company level to a maximum of 20% and at the holding company
level to a maximum of 33 1/3%. An additional requirement under these Canadian
broadcasting ownership rules is that the CEO of a company that is a licensed
broadcasting undertaking must be a Canadian citizen or permanent resident of
Canada. The CRTC is precluded under a direction issued under the Broadcasting
Act from issuing, amending or renewing a broadcasting licence of an
applicant that does not satisfy these Canadian ownership and control criteria.
Cultural concerns over increased foreign control of
broadcasting activities lie behind an additional restriction that prevents the
holding company of a broadcasting licensee that exceeds the former 20% limit (or
its directors) from exercising control or influence over any programming
decisions of a subsidiary licensee. In line with CRTC practice, programming
committees have been established within the relevant subsidiary licensees,
thereby allowing foreign investment in voting shares of BCE to reach the maximum
of 33 1/3%.
We monitor the level of non-Canadian ownership of
our common shares and provide periodic reports to the CRTC.
76
BCE Inc. 2015 PROXY CIRCULAR |
|
|
|
OTHER IMPORTANT INFORMATION |
12 |
12.4 How to request more information |
Additional financial information is contained in
BCEs consolidated financial statements and MD&A for the year ended December 31,
2014. These documents are also available on our website at
BCE.ca, on SEDAR at sedar.com and on EDGAR
at sec.gov. All of our news releases are also
available on our website. You can also ask us for a copy of these documents, as
well as of the documents listed below, at no charge:
-
our most recent annual report, which includes our
comparative financial statements and MD&A for the most recently completed
financial year, together with the accompanying auditors report
-
any interim financial reports that were filed after
the financial statements for our most recently completed financial year
-
our MD&A for the interim periods
-
the circular for our most recent annual shareholder
meeting, and
- our most recent AIF, together with any document,
or the relevant pages of any document, incorporated by reference into it.
Please write to the Corporate Secretarys Office or
the Investor Relations Group at 1 Carrefour Alexander-Graham-Bell, Building A,
7th floor, Verdun, Québec, Canada, H3E 3B3 or call 1-800-339-6353.
If you have any questions about the information
contained in this document or require assistance in completing your proxy form
or voting instruction form, please contact the Corporations proxy solicitation
agent, D.F. King, by e-mail at inquiries@dfking.com,
by telephone at 1-866-822-1244 (toll free within Canada or the United States) or
416-682-3825 (banks, brokers and collect calls outside Canada and the United
States) for service in English and French or by fax at 1-888-509-5907 (North
American Toll Free Facsimile) or 647-351-3176.
12.5 Shareholder proposals
for our 2016 annual meeting |
We will consider proposals from shareholders to
include as items in the management proxy circular for our 2016 annual
shareholder meeting.
Your proposals must be received by us by
December 6, 2015.
|
|
BCE Inc.
2015 PROXY CIRCULAR
77 |
13 |
SCHEDULE A
BCE AMENDED AND RESTATED BY-LAW ONE |
|
13 |
SCHEDULE A
BCE AMENDED AND RESTATED BY-LAW ONE |
BCE Inc. By-law one
A by-law to regulate generally the business and
affairs of the Corporation
PART 1 SHAREHOLDERS
Section 1.01 Meetings
Subject to the laws governing the Corporation and
the Articles of the Corporation, meetings of shareholders of the Corporation may
be held at such place and at such time as the directors, the
Chair Chairman of the Board or the President, if he
is a director, shall determine.
Section 1.02 Notice of Meetings and Documentation
Notice of the time and place of a meeting of
shareholders shall be sent not less than 21 days nor more than 60 days before
the meeting to each shareholder entitled to vote at the meeting, to each
director and to the auditors of the Corporation. Where there is more than one
person registered as a shareholder in respect of any share or shares, such
notice may be given to whichever of such persons is named first in the
securities register of the Corporation and any notice so given shall be
sufficient notice to all of them. Notice of shareholder meetings or any other
notices or documents intended for shareholders may be given by prepaid mail,
facsimile, or by any electronic or other communication facilities. The Board of
Directors may establish, by resolution, procedures to give, deliver or send a
notice or other document to the shareholders, directors and auditors by any
means permitted under the laws governing the Corporation or pursuant to the
Articles or by-laws of the Corporation. In the event that it is impossible or
impracticable for any reason whatsoever to give notice as otherwise permitted
under the laws governing the Corporation, notice may be given by advertisement
published once in a newspaper in such cities or places as the directors may from
time to time determine. Subject to applicable laws, a notice or other document
shall be deemed to have been given, delivered or sent (i) when it is delivered
personally or to the recorded address pursuant to Section 1.13 hereof; (ii) when
it has been deposited in a post office or post office letter box; or (iii) when
it has been dispatched or delivered for dispatch by means of facsimile,
electronic or other communication facilities.
Section 1.03 Omission of Notification
The accidental omission to give, deliver or send any
notice to any shareholder, director or auditor or the non-receipt of any notice
by any such person or any irregularity or error in any notice or in the giving,
delivery or sending thereof shall not invalidate any action taken at any meeting
held pursuant to such notice or otherwise founded thereon.
Section 1.04 Participation by Electronic Means
Any person entitled to attend and vote at a meeting
of shareholders may (i) vote at the meeting in person or by proxy (and, subject
to any determinations made from time to time by the directors, may appoint a
proxy by any method permitted by law, including over the Internet, by the input
of data using telephonic facilities or by reproduction using facsimile or
electronic facilities); and (ii) may participate in the meeting by means of telephonic, electronic or other
communication facilities that permit all participants to communicate adequately
with each other during the meeting, if the Corporation makes available such
communication facilities.
Section 1.05 Meetings by Electronic Means
The Board of Directors may determine the manner of
which meetings of shareholders shall be held (either at a specific place, or by
means of telephonic, electronic or other communication facilities that permit
all participants to communicate adequately with each other, or a combination of
the foregoing), as permitted by the laws governing the Corporation and the
Articles of the Corporation; and when calling a meeting of shareholders, the
Board of Directors may determine that such meeting will be held entirely by
means of such telephonic, electronic or other communication facilities, provided
that all participants shall be able to communicate adequately with each other
during the meeting.
Section 1.06 Quorum
Except as otherwise provided in
the Articles of the Corporation, the quorum for the transaction of business at
any meeting of shareholders shall be two persons present at the opening of the
meeting who are entitled to vote thereat either as shareholders or as proxy
holders and holding or representing not less than 25% of the outstanding shares
of the Corporation entitled to be voted at such meeting. If a quorum is not
present within such reasonable time (determined by the Chair of the meeting)
after the time fixed for the holding of the meeting, the persons present and
entitled to vote thereat may adjourn the meeting to a fixed time and place. A
person participating in a meeting by means of telephonic, electronic or other
communication facilities shall be deemed for the purposes hereof to be present
at the meeting.
Except as otherwise provided in the Articles of the Corporation, the
holders present in person or by proxy of not less than 20% of the outstanding
shares of the Corporation entitled to be voted at a meeting of shareholders
shall constitute a quorum. If a quorum is not present within 30 minutes of the
opening of the meeting, the meeting shall be adjourned to such date, not less
than 15 days nor more than 30 days thereafter, and to such time and place as may
be designated by the chairman of the meeting, and except as required by the laws
governing the Corporation, it shall not be necessary to give notice of the
adjourned meeting other than by announcement at the earlier meeting that is
adjourned and by advertisement in each newspaper in which notice of the record
date for the original meeting was published. Notwithstanding the foregoing, the
Corporation shall not be required to announce by way of advertisement in
newspapers the adjournment of the meeting to a date not more than three business
days after the original meeting to the extent that the only item of business at
such adjourned meeting is the designation by the chairman of a date, time and
place for a further adjournment of
78
BCE Inc. 2015 PROXY CIRCULAR |
|
|
|
SCHEDULE A
BCE AMENDED AND RESTATED BY-LAW ONE |
13 |
the meeting. At any adjourned meeting, the holders of shares of the
Corporation present in person or by proxy, whether they hold more or less than
20% of the outstanding shares of the Corporation entitled to vote at the
meeting, shall constitute a quorum and may transact the business and any
amendments thereto for which the meeting was originally called, and any other
business which may come properly before such adjourned meeting. A person
participating in a meeting by means of telephonic, electronic or other
communication facilities shall be deemed for the purposes hereof to be present
at the meeting.
Section 1.07 Chair
Chairman of Meeting
The Chair
Chairman of the Board, or in his absence, the lead director, if any,
appointed under Section 2.07 hereof, or in his absence, the President, if he is
a director, or in his absence, any officer who is a director, or in his absence
any Vice-President who is a shareholder, shall preside as
chair chairman at any meeting of the shareholders.
If all of the foregoing be absent, the persons present and entitled to vote at
said meeting shall choose one of their number to act as
chair chairman of the meeting.
In the case of an equality of votes at any meeting of the shareholders, the
Chair of the meeting shall not have a second or casting vote.
Section 1.08 Procedure at Meetings
The chair
chairman of any meeting of shareholders shall conduct the meeting and
shall determine the procedure thereof in all respects. The decision of the
chair chairman on all matters or things, including
but without in any way limiting the generality of the foregoing, any question
regarding the validity or invalidity of any instruments of proxy, shall be
conclusive and binding upon the meeting.
Section 1.09 Persons Entitled to Be Present
The only persons entitled to attend a meeting of
shareholders shall be those entitled to vote thereat, the directors, the
auditors and others who, although not entitled to vote, are entitled or required
under the laws governing the Corporation or the Articles of the Corporation to
be present at the meeting. Any other person may be admitted by permission of the
chair chairman of the meeting or with the consent of
the meeting.
Section 1.10 Scrutineers
The chair
chairman of a meeting of shareholders may, or if a ballot is to be
taken shall, appoint one or more persons, who need not be shareholders, to act
as scrutineers at any such meeting.
Section 1.11 Voting
Voting at any meeting of shareholders shall be by a
show of hands by holders present (or represented by proxy) at such meeting
except where, either before or after any vote by show of hands a ballot is
required by the chair chairman
of the meeting or is demanded by any person present and entitled to vote at the
meeting. A requirement or a demand for a ballot may be withdrawn at any time
prior to the taking of the ballot. Any ballot shall be taken in such manner and
either at once or after adjournment, as the chair
chairman of the meeting shall direct. Unless otherwise required by law
or by the Articles of the Corporation, a majority of the votes cast shall be
sufficient for all purposes and shall be the decision of the meeting. A
declaration by the chair chairman
of any meeting that a vote taken upon a question has been carried or carried
unanimously or by particular majority, or lost or not carried by a particular
majority, shall be conclusive evidence of the fact. In case of an
equality of votes either upon a show of hands or upon a ballot, the chairman of
the meeting shall be entitled to a casting vote in addition to the vote or votes
to which he is entitled as a shareholder or proxyholder. Where there is
more than one person registered as a shareholder in respect of any share or
shares and if more than one of such persons be present at any meeting in person or by proxy, that one of
the said persons so present whose name stands first in the securities register
of the Corporation in respect of such share or shares shall alone be entitled to
vote in respect thereof.
To the extent permitted by the by-laws or the
Articles of the Corporation or by the laws governing the Corporation, the
directors may establish, in connection with any meeting of shareholders,
procedures regarding voting at the meeting by means of telephonic, electronic or
other communication facilities, and make available such communication facilities
consistent with those procedures. The directors may determine from time to time
that the voting at any specific meeting shall be held entirely by such means.
Section 1.12 Dividends and Other Amounts
A dividend or other amount payable in cash with
respect to the outstanding shares of the Corporation may be paid by cheque drawn
on a financial institution or by electronic means to or to the order of each
registered holder of shares of the class or series in respect of which it is to
be paid. Cheques may be sent by prepaid ordinary mail or delivered to such
registered holder at his address as recorded in the securities register of the
Corporation, unless such holder has otherwise directed. In case of joint
holders, a cheque shall, unless such joint holders have otherwise directed, be
made payable to the order of all such joint holders and if more than one address
is recorded in the securities register of the Corporation in respect of such
joint holding, a cheque shall be mailed or delivered to the first address so
recorded. The mailing or delivery of such cheque as aforesaid, unless the same
is not paid on due presentation, shall satisfy and discharge all liability for
the dividends (or other amounts) for the sum represented thereby plus the amount
of any tax, levy or duty which the Corporation was required to and did withhold.
In the event of non-receipt of any cheque by the person to whom it is sent as
aforesaid, the Corporation shall issue to such person a replacement cheque for a
like amount upon such terms as to indemnity, reimbursement of expenses and
evidence of non-receipt as the directors or any officer or agent designated by
them may from time to time prescribe, whether generally or in any particular
case.
Dividends or other amounts payable in cash with
respect to the outstanding shares of the Corporation may be paid to shareholders
in Canadian currency or in equivalent amounts of a currency or currencies other
than Canadian currency. The Board of Directors may declare dividends or other
amounts in any currency or in alternative currencies and make such provisions as
it deems advisable for the payment of such dividends or other amounts.
Section 1.13 Addresses of Shareholders
Every shareholder shall furnish to the Corporation
or any agent appointed by the Corporation an address to which all notices and
documents intended for the shareholders shall be sent by prepaid mail or hand
delivery. If a shareholder fails to furnish such an address, the address of such
shareholder shall be deemed to be that of the office at which the central
securities register of the Corporation is maintained; provided that the
Treasurer may change or cause to be changed the address of any shareholder in
accordance with any information believed by him to be reliable.
The Corporation may maintain a supplemental list of
shareholders who consent to receive notices or documents intended for the
shareholders by means of electronic or other communication facilities. Such
supplemental list and the electronic addresses contained therein shall not be
included in, and shall be deemed not to form part of, the securities register
required to be maintained by the Corporation or the shareholders lists or
supplemental shareholders list required
|
|
BCE Inc.
2015 PROXY CIRCULAR
79 |
13 |
SCHEDULE A
BCE AMENDED AND RESTATED BY-LAW ONE |
|
to be furnished by the Corporation in certain
circumstances. In the event that the Corporation is unable to deliver, in
accordance with such supplemental list, notices or documents required to be
delivered by the laws governing the Corporation or pursuant to the Articles or
by-laws of the Corporation to a shareholder at the electronic address provided
to the Corporation, the Corporation shall deliver such notices or documents at
the address of such shareholder maintained in the securities register in
accordance with the first paragraph of this Section 1.13.
Section 1.14 Advance Notice of Nominations of
Directors
(a) |
Subject to the laws
governing the Corporation and the Articles of the Corporation, only persons who
are nominated in accordance with this Section 1.14 shall be eligible for
election as directors of the Corporation. Nominations of persons for election to
the Board of Directors may be made at any annual meeting of shareholders, or at
any special meeting of shareholders, if one of the purposes for which the
special meeting was called was the election of directors:
|
|
(i) |
by or at the direction of the Board of
Directors, including pursuant to a notice of meeting;
|
|
(ii) |
by or at the direction or request of one or
more shareholders pursuant to a proposal made in accordance with the Act, or a
requisition of the shareholders made in accordance with the Act; or
|
|
(iii) |
by any person (a Nominating Shareholder)
|
|
|
(A) |
who, at the close of business on the date of
the giving of the notice provided for below in this Section 1.14 and on the
record date for notice of such meeting, is entered in the securities register as
a holder of one or more shares carrying the right to vote at such meeting or who
beneficially owns shares that are entitled to be voted at such meeting and
provides evidence of such beneficial ownership to the Corporation; and
|
|
|
(B) |
who complies with the notice procedures set
forth below in this Section 1.14. |
(b) |
In addition to any
other applicable requirements, for a nomination to be made by a Nominating
Shareholder, the Nominating Shareholder must have given timely notice thereof in
proper written form to the Corporate Secretary of the Corporation at the
principal executive offices of the Corporation in accordance with this Section
1.14. |
(c) |
To be timely, a
Nominating Shareholders notice to the Corporate Secretary of the Corporation
must be given: |
|
(i) |
in the case of an annual meeting of shareholders, not less than 30 days before
the date of the annual meeting of shareholders; provided, however, that in the
event that the annual meeting of shareholders is to be held on a date that is
less than 50 days after the date (the Notice Date) on which the first public
announcement of the date of the annual meeting was made, notice by the
Nominating Shareholder may be given not later than the close of business on the
10th day following the Notice Date; |
|
(ii) |
in the case of a special meeting (which is not also an annual meeting) of
shareholders called for the purpose of electing directors (whether or not called
for other purposes), not later than the close of business on the 15th day
following the day on which the first public announcement of the date of the
special meeting of shareholders was made. |
(d) |
To be in proper
written form, a Nominating Shareholders notice to the Corporate Secretary of
the Corporation must set forth: |
|
(i) |
as to each person whom the Nominating Shareholder proposes to nominate for
election as a director (the Proposed Nominee): |
|
|
(A) |
the name, age, and province or state, and
country of residence of the Proposed Nominee; |
|
|
(B) |
the principal occupation, business or
employment of the Proposed Nominee, both at present and within the five years
preceding the notice; |
|
|
(C) |
the number of securities of each class of voting securities of the Corporation
or its subsidiaries which are beneficially owned, or controlled or directed,
directly or indirectly, by the Proposed Nominee as of the record date for the
meeting of shareholders (if such date shall then have been made publicly
available and shall have occurred) and as of the date of such notice;
|
|
|
(D) |
a description of any agreement, arrangement
or understanding (financial, compensation or indemnity related or otherwise)
between the Nominating Shareholder and the Proposed Nominee, or any affiliates
or associates of, or any person acting jointly or in concert with the Nominating
Shareholder or the Proposed Nominee, in connection with the Proposed Nominees
election as director; |
|
|
(E) |
whether the Proposed Nominee is party to any existing or proposed relationship,
agreement, arrangement or understanding with any competitor of the Corporation
or its affiliates or any other third party which may give rise to a real or
perceived conflict of interest between the interests of the Corporation and the
interests of the Proposed Nominee; |
|
|
(F) |
whether the Proposed Nominee is a resident Canadian within the meaning of the
Act, and whether the Proposed Nominee is Canadian within the meaning of the
Broadcasting Act and the Telecommunications Act; and |
|
|
(G) |
any other information relating to the
Proposed Nominee that would be required to be disclosed in a dissidents proxy
circular in connection with solicitations of proxies for election of directors
pursuant to the Act and Applicable Securities Laws; and
|
|
(ii) |
as to the Nominating Shareholder giving the
notice, any proxy, contract, arrangement, understanding or relationship pursuant
to which such Nominating Shareholder has any rights or obligations relating to
the voting of any securities of the Corporation and any other information
relating to such Nominating Shareholder that would be required to be made in a
dissidents proxy circular in connection with solicitations of proxies for
election of directors pursuant to the Act and Applicable Securities Laws.
|
(e) |
No person shall be
eligible for election as a director of the Corporation unless nominated in
accordance with the provisions of this Section 1.14; provided, however, that
nothing in this Section 1.14 shall be deemed to preclude discussion by a
shareholder (as distinct from the nomination of directors) at a meeting of
shareholders of any matter in respect of which it would have been entitled to
submit a proposal pursuant to the provisions of the Act. The Chair of the
meeting shall have the power and duty to determine whether a nomination was made
in accordance with |
80
BCE Inc. 2015 PROXY CIRCULAR |
|
|
|
SCHEDULE A
BCE AMENDED AND RESTATED BY-LAW ONE |
13 |
|
the procedures set forth in this
Section 1.14 and, if any proposed nomination is not in compliance with this
Section 1.14, to declare that such defective nomination shall be disregarded.
|
(f) |
For purposes of this
Section 1.14: |
|
(i) |
Act means the
Canada Business Corporations Act, or any
statute that may be substituted therefor, as from time to time amended;
|
|
(ii) |
Applicable Securities Laws means the
applicable securities legislation of each relevant province and territory of
Canada, as amended from time to time, the rules, regulations and forms made or
promulgated under any such statute and the published national instruments,
multilateral instruments, policies, bulletins and notices of the securities
commission and similar regulatory authority of each province and territory of
Canada; and |
|
(iii) |
public announcement means disclosure in a press release reported by a national
news service in Canada, or in a document publicly filed by the Corporation under
its profile on the System for Electronic Document Analysis and Retrieval at
www.sedar.com. |
(g) |
Notwithstanding any
other provision of this by-law, notice given to the Corporate Secretary of the
Corporation pursuant to this Section 1.14 may only be given by personal
delivery, facsimile transmission (at such contact information as set out on the
Corporations issuer profile on the System for Electronic Document Analysis and
Retrieval at www.sedar.com) or electronic mail (to
corporate.secretariat@bell.ca), and shall be deemed to have been given and made
only at the time it is served by personal delivery or email (at the aforesaid
address) or sent by facsimile transmission (provided that receipt of
confirmation of such transmission has been received) to the Corporate Secretary
at the address of the principal executive offices of the Corporation; provided
that if such delivery or electronic communication is made on a day which is not
a business day or later than 5:00 p.m. (Montreal time) on a day which is a
business day, then such delivery or electronic communication shall be deemed to
have been made on the subsequent day that is a business day.
|
(h) |
Notwithstanding the
foregoing, the Board may, in its sole discretion, waive any requirement in this
Section 1.14. |
PART 2 DIRECTORS
Section 2.01 Election and Term of Office
The directors shall be elected at each annual
meeting of shareholders, except as otherwise provided by the laws governing the
Corporation. Each director shall hold office (i) until the next annual meeting;
(ii) until such person ceases to be a director as provided by the Articles of
the Corporation or the laws governing the Corporation; or (iii) until the
resignation of such director becomes effective, that is, at the time a written
resignation is sent to the Corporation or at the time specified in the
resignation, whichever is later.
Section 2.02 Time, Place and Notice of Meetings
As soon as may be practicable after the annual
meeting of shareholders in each year, a meeting of such of the newly elected
directors as are then present may be held, without notice, provided that they
shall constitute a quorum, for the appointment of the officers and the election
of the Chair Chairman of
the Board and the President of the Corporation, if he is a director, and the
transaction of such other business as may come before the meeting.
Subject to the provisions of any resolution of the
directors, (i) meetings of the directors may be called at any time by or by
order of the Chair Chairman
of the Board, the President, if he is a director, any officer who is a director
or any two directors; and (ii) notice of the time and place of each meeting of
the directors shall be delivered, mailed, or communicated by means of
telephonic, electronic or any other communication facilities to each director at
least 24 hours, excluding holidays, before the time fixed for the meeting, save
that no notice shall be necessary if all the directors are present or if, either
before or after the meeting is held, those absent waive notice.
Meetings of the Board of Directors may be held at
any place within or outside Canada. In addition, meetings of the Board of
Directors may be held by means of telephonic, electronic or other communication
facilities that permit all directors to communicate adequately with each other
during the meeting, if the Corporation makes available such communication
facilities and in accordance with the procedures, if any, that may be adopted
from time to time by the directors.
Section 2.03 Participation to Meetings
If all the directors of the Corporation consent, a
director may participate in a meeting of the Board of Directors or of a
committee of directors by means of telephonic, electronic or other communication
facilities that permit all directors to communicate adequately with each other
during the meeting, if the Corporation makes available such communication
facilities and in accordance with the procedures, if any, that may be adopted
from time to time by the directors.
Section 2.04 Quorum and Voting
The directors may, from time to time, fix by
resolution the quorum for meetings of the directors
which shall, in all cases, be at least a majority of the directors. If not fixed
by resolution of the directors, a majority of directors shall constitute a
quorum. but unless so fixed three directors shall constitute
a quorum. At any meeting of the directors, any question shall be
decided by a majority of the votes cast. In the case of
an equality of votes at any meeting of the directors, the Chair of the meeting
shall not have a second or casting vote. A director participating in
a meeting by means of telephonic, electronic or other communication facilities
shall be deemed for the purposes hereof to be present at the meeting.
Section 2.05 Chair
Chairman of Meeting
Subject to the provisions of any resolution of the
directors, the Chair Chairman
of the Board, or in his absence, the President, if he is a director, or in the
absence of all of them, any officer who is a director, or in the absence also of
any such officer, such director as the meeting shall select, shall act as
chair chairman of the meeting.
Section 2.06 Number of Directors
Subject to the provisions of the laws governing the
Corporation and of the Articles of the Corporation, the number of directors
shall be as determined from time to time by resolution of the directors.
Section 2.07 Chair
Chairman of the Board
The directors may determine, as they shall deem
appropriate from time to time, that the Chair
Chairman of the Board: (i) shall not be an officer of the Corporation
and shall act solely in a non-executive capacity; or (ii) shall be an officer of
the Corporation and shall act in an executive capacity. Should the directors at
any time determine that the Chair
Chairman of the Board shall be for the time being an officer of the
Corporation and shall act in an executive capacity, they shall as soon as
practicable appoint from among themselves a director (hereinafter referred to as
the lead director) who is not an employee of the Corporation or any of its
subsidiaries to ensure that the Board of Directors can function independently of
management of the Corporation.
|
|
BCE Inc.
2015 PROXY CIRCULAR
81 |
13 |
SCHEDULE A
BCE AMENDED AND RESTATED BY-LAW ONE |
|
PART 3 EXECUTION OF DOCUMENTS
Section 3.01
Execution of Documents
The directors may from time to time determine the
officers or other persons by whom any documents of the Corporation shall be
executed and the manner of execution thereof, including the use of reproduction
by means of facsimile or electronic facilities of any or all signatures and the
use of the corporate seal or a reproduction thereof by means of facsimile or
electronic facilities.
PART 4 REPEAL
Section 4.01 Repeal
Upon the date of this by-law becoming effective,
BY-LAW NO. 1 shall be repealed, provided that such repeal shall not affect the
previous operation of BY-LAW NO. 1 or affect the validity of any act done or
right, privilege, obligation or liability acquired or incurred under, or the
validity of any contract or agreement made pursuant to such BY-LAW NO. 1 prior
to its repeal and provided further that all by-laws of the Corporation
previously repealed shall remain repealed. All officers and persons acting under
BY-LAW NO. 1 shall, notwithstanding its repeal, continue to act as if appointed
under the provisions of this By-Law or by the Canada Business Corporations
Act and all resolutions of the shareholders or Directors passed under any
repealed by-law shall continue good and valid except to the extent inconsistent
with this by-law and until amended or repealed.
82
BCE Inc. 2015 PROXY CIRCULAR |
|
|
|
SCHEDULE B
SHAREHOLDER PROPOSALS |
14 |
14 |
SCHEDULE B SHAREHOLDER PROPOSALS |
Three shareholder proposals have been submitted for
consideration at the meeting by the Mouvement déducation et de défense des
actionnaires (MéDAC), an investor holding at least $2,000 worth of BCE common
shares. The full text of each proposal and supporting comments are set out in
italics below (translation from the original proposals submitted by MéDAC in
French).
PROPOSAL NO. 1 Director
qualifications: lack of social and environmental responsibility experience |
Be it resolved that the Board of
Directors revise its director nominee selection process to include social and
environmental responsibility knowledge and experience requirements.
In its social responsibility report, BCE acknowledges that sustainable
development is a global issue and acts in line with an overall sustainable
development vision, targeting responsible economic growth, by forging
relationships between communities and protecting the environment. BCE is also a
signatory to the United Nations Global Compact, a set of universal principles in
the areas of human rights, labour, the environment and anti-corruption.
Yet, from a review of the profiles of the director nominees standing for
election in the last annual general meeting, it is clear that none of the
nominees had any specific or general social, environmental or sustainable
development qualifications. In addition, the directors continuous education
program does not appear to include any information or training sessions to
enhance director knowledge in this area.
We raise the following question: how can directors factor sustainable
development criteria into their decision-making if they lack the basic knowledge
to do so? How can the Human Resources and Compensation Committee members take
non-financial criteria into account in assessing the performance of senior
executives given their lack of basic knowledge in the area?
The Board of Directors recommends that shareholders
vote AGAINST Proposal No. 1 for the following reasons:
The Boards objective is to have a sufficient range
of skills, expertise and experience to ensure that it can carry out its
responsibilities effectively. Directors are chosen for their ability
to contribute to the broad range of issues with which the Board routinely deals.
The Board believes that its current process to identify and select potential
directors allows it to achieve this objective, including with regard to social
and environmental responsibility, as demonstrated by BCEs leadership in that
regard. Among other things, the Corporation is the first and only
telecommunications company in Canada to obtain ISO 14001 certification for its
environmental management system. The Corporation is also listed on several
social investment indices and is included in more than 60 investment funds based
on social and/or environmental screening criteria. BCE has been listed on the 50
Most Socially Responsible Corporations by Macleans, and on the Best 50
Corporate Citizens in Canada and the Global 100 Most Sustainable Corporations In
the World by Corporate Knights.
Finally, the Board has implemented a range of social
and environmental policies which are supported by various programs and
initiatives. These policies address issues of importance to our many
stakeholders including: preventing conflicts of interest; protecting company
assets; safeguarding privacy and confidentiality; treating clients, business
partners, team members and competitors with respect and honesty; fostering a
diverse and safe workplace; and protecting the environment.
As a result, the Board believes that the process it
follows to identify directors allows it to fulfill its responsibilities,
including in terms of social and environmental responsibility.
For these reasons, the Board of Directors recommends
that shareholders vote AGAINST this proposal.
PROPOSAL NO. 2 Gender equality |
Be it resolved that the Board of
Directors adopt a policy stipulating that it undertakes to achieve a minimum
critical mass of 40% representation of each sex in the next five years.
The Board of Directors currently includes only two women among its 13
directors. However, the current consensus is that women have the knowledge,
skills and experience to serve on boards of directors of all sizes, including
the Board of BCE. If we take, for example, the total number of directors who
successfully completed Université Lavals corporate governance training program,
over 40% of them were women. While specific competency is available to meet such
an objective in a timely manner, the value added of a better representative
balance on the Board should also be taken into account. In this respect, note
that human resources studies have identified that the two sexes have different
and complementary leadership styles and management qualities.
This approach ensures neither sex is isolated due to under-representation and
maximizes the benefits of a complementary decision-making vision. Such an
approach was put forward by the European Community in its gender parity study.
BCE stands apart as one of Canadas Top 50 Socially Responsible Corporations
for 2012 according to Macleans/Jantzi-Sustainalytics and is ranked one of the
2013 Best Corporate Citizens in Canada by Corporate Knights. BCE must also
distinguish itself through its openness to a greater presence of women on its
Board of Directors by setting an objective to be met over a five-year period of
40% women directors serving on its Board.
|
|
BCE Inc.
2015 PROXY CIRCULAR
83 |
14 |
SCHEDULE B
SHAREHOLDER PROPOSALS |
|
The Board of Directors recommends that shareholders
vote AGAINST Proposal No. 2 for the following reasons:
The Board supports the objective of increasing the
number of women as directors. To that end, as disclosed in section 6 entitled
Corporate Governance Practices Board of directors Composition of the Board
of directors and nomination of directors, the Board has adopted a policy
regarding diversity and the representation of women on the Board. The policy
provides that the Governance Committee will, when identifying and considering
individuals for election to the Board: (i) consider only the most qualified
candidates based on their skills, expertise, experience and background, (ii)
consider the level of representation of women on the Board, and (iii) strive to
include, within the candidates considered, individuals with a diverse
background, including gender, age, ethnicity and experience. Finally, the policy
states that, on a yearly basis, the Governance Committee will report to the
Board in respect of the measures taken to ensure that the policy has been
effectively implemented, the annual and cumulative progress in achieving the objectives of
the policy and the effectiveness of the policy as a whole. In measuring the
effectiveness of the policy, the Governance Committee will consider its
identification and consideration of any individuals to become Board members in
the previous year and whether and how the policy influenced such identification
and consideration.
The Board, on the recommendation of the Governance
Committee, also adopted a target that women represent at least 25% of
non-executive directors by the end of 2017. The Board believes that such target,
which will be reviewed on a regular basis by the Governance Committee, is
consistent with approaches proposed by various groups and corporations in the
North American context and appropriate for promoting diversity and the
attraction of the most highly qualified directors available who will contribute
to the broad range of issues which the Board has to address.
For these reasons, the Board of Directors recommends
that shareholders vote AGAINST this proposal.
PROPOSAL NO. 3 Class action for
overcharging of listed mandatory fees |
Be it resolved that BCE Inc.
disclose, at the next annual meeting, the policy it intends to adopt to avoid
further legal proceedings for abusive business and pricing practices.
On June 13, 2014, a large class action was authorized by the Superior Court
of Québec against Bell Canada (BCE) and Bell ExpressVu for overcharging its
listed mandatory fees from December 1, 2007 to June 29, 2011 across Canada. The
charges at issue involved fees for touch-tone service, Internet modem rental,
MSN Premium service and network access, digital service, HD receiver rental for
Fibe TV and long-distance network access. Any Canadian who subscribed to those
services and was charged the aforementioned fees may claim damages.
We would be remiss in failing to raise this issue, given the corporations
values with regard to social responsibility and service quality. Such practices
may jeopardize BCEs operating legitimacy, and the Board of Directors must
ensure that all policies are implemented to maintain such legitimacy. This facet
of social responsibility deserves greater focus and respect.
The Board of Directors recommends that shareholders
vote AGAINST Proposal No. 3 for the following reasons:
BCE has implemented solid corporate-wide policies
and practices to govern ethics, business practices and risk management that
govern how we do business. First, as described in section 6.3 entitled
Ethical business conduct, the Board has adopted a Code of Business Conduct
that sets out the highest standards of honest and ethical conduct that our
shareholders and customers expect of us in all aspects of our business. The Code
mandatorily applies to all directors, executives and employees of BCE.
Furthermore, as described in section 6.1 entitled Board of directors Risk Oversight, BCE has a strong culture of risk
management under the ultimate responsibility of the Board, that applies at all
levels of the organization. Our risk management framework is part of how BCE
operates on a day-to-day basis, including our business practices, customer
relations and compliance with applicable laws.
The Board disputes any assumption that the existence
of a legal proceeding against the Corporation implies that its business and
pricing practices would be abusive. Despite BCEs commitment to conduct its
business to the highest standards of ethics, integrity, honesty, fairness and
professionalism, the Corporation may from time to time be named as defendant or
be involved in various legal proceedings. BCE manages and mitigates these risks
through a robust legal and litigation management function and if changes to our
business practices are required as a result of changes in laws or otherwise they
are implemented in due course.
Finally, and contrary to what the proposal implies,
no court has yet ruled regarding the merits of the allegations contained in the
legal proceeding referred to in the proposal. The proceeding has been certified,
the first stage to proceed as a class action, and based on information currently
available and managements assessment of the merits of such legal proceeding,
the Corporation believes that it has strong defences and intends to vigorously
defend its position.
For these reasons, the Board of Directors recommends
that shareholders vote AGAINST this proposal.
84
BCE Inc. 2015 PROXY CIRCULAR |
|
|
Electronic delivery
We encourage shareholders to sign up to receive
BCEs corporate information electronically. You can choose to receive all of our
corporate documents electronically, such as future circulars and annual reports.
We will send you an e-mail telling you when they are available on our website.
To sign up, go to our website at
BCE.ca, click on the banner 2015 Annual General
Shareholder Meeting and then on the relevant link under the heading
Sign up for electronic delivery.
If you do not sign up for this service, we will
continue to send you these documents by mail, unless you tell us otherwise on
your proxy form or voting instruction form.
Faster
Receive your documents earlier
Cleaner
Save trees, energy and water, and reduce air
emissions
Cheaper
Reduce your companys printing and postage costs
If you have any question about the information
contained in this document or require assistance in completing your proxy form
or voting instruction form, please contact the Corporations proxy solicitation
agent, D.F. King. |
|
|
North American Toll Free Phone |
1-866-822-1244 |
Banks, Brokers and Collect Calls |
416-682-3825 |
Facsimile |
647-351-3176 |
North American Toll Free Facsimile |
1-888-509-5907 |
Email |
inquiries@dfking.com |
Exhibit 99.2
|
Registered Shareholders |
|
Proxy Form for Our
Annual General Shareholder Meeting
on Thursday, April 30, 2015 |
Proxy solicited by and on behalf of management |
Our annual general shareholder meeting (meeting) will be held at 9:30 a.m. (Eastern time) on
Thursday, April 30, 2015 at the Design Exchange, 234 Bay Street, Trading Floor, Toronto, Ontario.
This information sheet and its reverse side provide important information to help you complete your proxy form. The proxy form is attached to this information sheet (see pages 1 and 2) and can be easily separated by tearing along the perforated line.
YOUR VOTE IS IMPORTANT
As a shareholder, you have the right to vote your shares on electing directors, appointing the auditors, considering an advisory vote on executive compensation, considering amendments to BCEs By-law one, considering three shareholder proposals, and any other items that may properly come before the meeting. You can vote your shares by proxy or in person at the meeting or any adjournment. If you receive more than one proxy form, please complete, date, sign and return each one.
IF YOU ARE VOTING IN PERSON AT THE MEETING
Do not complete the proxy form.
VOTING BY PROXY
This is the easiest way to vote. Voting by proxy means that you are giving each person named in section A of the proxy form (proxyholder) the authority to vote your shares for you. If you are voting by proxy, CST Trust Company (CST) or other agents we appoint
must receive your signed proxy form or you must have voted by Internet or telephone before 4:45 p.m. (Eastern time) on Wednesday, April 29, 2015. There are five ways to vote by proxy. See the reverse side of this information sheet for details.
SPECIAL NEEDS
Please let us know if you need any special assistance at the meeting by calling
CST at 1-800-561-0934.
In the proxy form, you and your refer to the holder of BCE Inc. common shares. We, us, our, the Corporation and BCE refer to BCE Inc.
NOTE: The proxy form attached to this information sheet is also to be used by participants in the Corporations Employees Savings Plan (ESP).
To accelerate the registration of shareholders, please have these instructions with you and present them to the shareholders registration desk before you enter the meeting.
|
CONTROL NUMBER |
Receiving
Documents
Electronically
You can choose to receive future shareholder communications electronically.
Faster
Receive your documents earlier.
Cleaner
Save trees, energy and water, and reduce air emissions.
Cheaper
Reduce your company printing and postage costs.
To sign up, visit our website at BCE.ca, click on the 2015 Annual General Shareholder Meeting banner, then on the relevant link under the heading Sign up for electronic delivery. If you do not sign up for this service, we will continue to send you documents by mail.
|
|
Five Ways
to Vote by Proxy |
|
ON THE INTERNET
Go to CSTs website at www.cstvotemyproxy.com and follow the instructions on screen. You will need your 13-digit control number, found on the left. |
|
BY TELEPHONE
Call 1-888-489-7352 (toll-free in Canada and the United States) or 1-800-1960-1968 (other countries) from a touch-tone phone and follow the instructions.
You will need your 13-digit control number, found on the left.
If you choose to vote by telephone, you cannot appoint anyone other than the directors named in section A of the proxy form as your proxyholder. |
|
BY FAX
Detach the proxy form (pages 1 and 2) from the information sheet by tearing along the perforated line.
Complete the proxy form, ensuring that you sign and date it, and fax both pages in one transmission to
1-866-781-3111 (toll-free in Canada and the United States) or 416-368-2502 (other countries). |
|
BY MAIL
Detach the proxy form (pages 1 and 2) from the information sheet by tearing along the perforated line.
Complete the proxy form, ensuring that you sign and date it, and return it in the envelope we have provided. |
|
|
|
|
|
|
CONTROL NUMBER
YOU WILL NEED THIS NUMBER TO VOTE
ON THE INTERNET OR BY TELEPHONE:
|
|
By appointing another person to go to the meeting
and vote your shares for you
This person does not have to be a shareholder.
Strike out the four names that are printed in section A of the proxy form and write the name of the person you are appointing in the space provided. Complete your voting instructions, sign and date the form and return it to CST as instructed.
Make sure that the person you appoint is aware that he or she has been appointed and attends the meeting.
At the meeting, he or she should see a CST representative. |
Our annual general shareholder meeting will be held at
9:30 a.m. (Eastern time) on Thursday, April 30, 2015 at the:
Design Exchange
234 Bay Street
Trading Floor
Toronto, Ontario M5K 1B2 |
|
P. 1
This Is Your Proxy Form for the
BCE Annual General Shareholder Meeting
on Thursday, April 30, 2015 |
Proxy solicited by and on behalf of management
If you intend to vote by fax or by mail, detach this proxy form by tearing along the perforated line, and complete it, ensuring that you sign and date it in order to exercise your right to vote your shares or to appoint someone else to vote your shares for you at the meeting. If you wish to vote on the Internet or by telephone, refer to the instructions on the previous page.
This form revokes all proxy forms (with respect to the same shares) you have previously signed that relate to the meeting. It will only be accepted as a valid proxy if it remains intact and has been signed. If you have any questions about completing this proxy form, please call D.F. King Canada, a divison of CST Investor Services Inc. at 1-866-822-1244 for service in English or in French.
|
COMPLETE THIS SECTION TO APPOINT A PROXYHOLDER
Appointing a Proxyholder
By completing this proxy form, you are appointing as your proxyholder
Ms. Sophie Brochu,
Mr. George A. Cope,
Mr. Thomas C. ONeill, or
Ms. Carole Taylor
who are directors of the Corporation, unless you appoint someone else.
Your proxyholder will attend the meeting and vote your shares on your behalf. Your proxyholder:
-
has the same rights you would have if you attended the meeting in person, including the right to appoint a substitute proxyholder
-
will vote your shares as you specify in section C. If you do not specify how you want your shares voted, the directors named as proxyholders intend to cast the votes represented by proxy at the meeting as recommended by the board of directors
-
may vote your shares as he or she sees fit on any amendments to these items and on any other items that may properly come before the meeting or any adjournment.
You have the right to appoint someone other than these four people as your proxyholder. To do this, strike out the four names listed above and print the name of the person you are appointing in the box below. This person does not have to be a shareholder of the Corporation.
|
|
TELL US IF YOU WANT TO RECEIVE FINANCIAL REPORTS
Quarterly Reports
We will NOT send the Corporations quarterly reports to you in 2015 (including Q1-2016), unless you tell us that you want to receive them by checking the box below.
If you do not check the box below or do not return pages 1 and 2 of this proxy form, we will assume that you DO NOT want to receive the Corporations quarterly reports in 2015.
Please send me the Corporations quarterly reports in 2015
Annual Report
By law, we must send you, as a registered shareholder, the Corporations annual financial statements and related managements discussion and analysis (MD&A), unless you tell us that you DO NOT want to receive them by checking the box below.
Please DO NOT send me the Corporations annual financial statements and related MD&A
If you check the box above, we will NOT send you the Corporations annual financial statements and related MD&A and this instruction will continue from year to year (unless you revoke it).
Please DO send me the Corporations annual financial statements and related MD&A
See the information sheet on how to sign up to receive these documents electronically.
If you check the box above (thereby revoking prior instructions) or do not return pages 1 and 2 of this proxy form, we will assume that you DO want to receive the Corporations annual financial statements and related MD&A. We will continue to send you the notice of annual general shareholder meeting and management proxy circular and proxy form so you can vote your shares.
|
Please complete the other side of this proxy form before faxing or mailing. Please send both pages in one fax transmission.
P. 2
|
COMPLETE THIS SECTION TO PROVIDE VOTING INSTRUCTIONS
|
|
Please check For, Withhold or Against, as applicable, for each of the following items. Please print in ink. Use a black or blue pen.
Mark your vote with an X as shown in this example. Voting recommendations are indicated by highlighted text over the boxes. |
|
ELECTION OF DIRECTORS: THE BOARD OF DIRECTORS RECOMMENDS VOTING
FOR ALL NOMINEES .
THE PROPOSED NOMINEES ARE: |
|
|
|
|
|
1. B.K. Allen |
|
|
2. R.A. Brenneman |
|
|
3. S. Brochu |
|
|
4. R.E. Brown |
|
|
5. G.A. Cope |
|
|
6. D.F. Denison |
|
|
7. R.P. Dexter |
|
|
8. I. Greenberg |
|
|
9. G.M. Nixon |
|
|
10. T.C. ONeill |
|
|
11. R.C. Simmonds |
|
|
12. C. Taylor |
|
|
13. P.R. Weiss |
|
|
|
APPOINTMENT OF AUDITORS: THE BOARD OF
DIRECTORS RECOMMENDS VOTING FOR THIS ITEM.
Deloitte LLP as auditors |
|
|
|
|
|
|
|
|
|
|
|
ADVISORY VOTE ON EXECUTIVE COMPENSATION:
THE BOARD OF DIRECTORS RECOMMENDS
VOTING FOR THIS ITEM.
Resolved, on an advisory basis and not to diminish the role and responsibilities of the board of directors, that the shareholders accept the approach to executive compensation disclosed in the 2015 management proxy circular dated March 5, 2015 delivered in advance of the 2015 annual meeting of shareholders of BCE.
|
|
|
|
|
|
|
|
|
|
|
|
AMENDMENTS TO BCES BY-LAW ONE: THE BOARD OF
DIRECTORS RECOMMENDS VOTING FOR THIS ITEM.
Resolved, as an ordinary resolution, that the amendments to By-law one of the Corporation, in the form adopted by the Board of Directors of BCE Inc. on February 5, 2015 and reflected in the amended and restated By-law one of the Corporation attached as Schedule A to the management proxy circular of the Corporation dated March 5, 2015, be and are hereby confirmed.
|
|
|
|
|
|
|
|
|
|
|
|
SHAREHOLDER PROPOSALS: THE BOARD OF
DIRECTORS RECOMMENDS VOTING AGAINST
ALL PROPOSALS.
Please read these shareholder proposals in full in the accompanying 2015 management proxy circular dated March 5, 2015.
|
|
|
|
PROPOSAL No. 1 Director Qualifications |
|
|
|
PROPOSAL No. 2 Gender Equality |
|
|
|
PROPOSAL No. 3 Business and Pricing Practices |
|
|
PLEASE SIGN THIS PROXY FORM
You must sign this proxy form to ensure that it will be accepted as valid. When you sign this proxy form, you authorize the proxyholder to act and vote your shares on your behalf at the meeting and any adjournment, and to carry out your voting instructions. If you are an individual shareholder, you or your authorized attorney must sign the proxy form. Your attorney may have to provide proof of your authorization. For shares registered in the name of two or more owners, at least one of the holders must sign to be accepted. For shares registered in the name of a corporation or other legal entity, an authorized officer or attorney must sign. This person may have to provide proof that he or she is authorized to sign.
|
|
|
|
|
|
|
2015 |
|
SIGNATURE
If you do not include a date, we will deem it to be the date that we mailed the proxy form to you.
|
DAY |
MONTH |
|
Please complete the other side of this proxy form before faxing or mailing. Please send both pages in one fax transmission.
BCE (NYSE:BCE)
Historical Stock Chart
From Jun 2024 to Jul 2024
BCE (NYSE:BCE)
Historical Stock Chart
From Jul 2023 to Jul 2024