Verizon is committed to the highest standards of corporate governance because we believe that good governance is essential to driving success, enhancing our reputation and building long-term, sustainable value for our shareholders and other stakeholders. Our Board of Directors oversees Verizon’s business strategies, risk management, responsible business practices and succession planning with the assistance of four standing committees comprised solely of independent directors. All Board members stand for election annually and, with the exception of the Chairman and CEO, are independent directors. An independent lead director shares governance responsibilities with the Chairman and facilitates forthright communication and effective independent oversight of management’s performance.
We believe that good governance starts with an independent, engaged and diverse Board. In 2018, one-third of our board members were women and nearly half were Hispanic or African American. Verizon’s commitment to board refreshment is central to ensuring that the composition of our Board evolves along with our strategic needs for the future. The Board’s Corporate Governance and Policy Committee regularly evaluates director skill sets to ensure the optimal combination of expertise is represented on the Board. In the last seven years, seven new independent directors have been elected to the Board, and the Corporate Governance and Policy Committee continues to actively oversee the recruitment of additional directors to ensure that this refreshment process continues.
Our Board is vigilant in the oversight of Verizon’s long-term strategy. At each Board meeting, Directors engage our senior leaders in robust discussions about Verizon’s strategic goals. It is with our corporate strategy and business priorities in mind that the Human Resources Committee determines the appropriate compensation structures and levels for our senior leaders to incentivize them to achieve these goals. To ensure Verizon has the financial ability to execute on our strategic plan, the Finance Committee monitors Verizon’s capital needs and financing plans. In addition, in order gain a broader perspective on the environment in which Verizon competes, our directors participate in numerous activities outside the boardroom, including regular education sessions on topics central to the industry.
We view Board oversight of Verizon’s risk profile – in its strategic activity, business operations and deployment of capital – as fundamental to the well-being of our Company. Our directors ensure that Verizon’s risk management policies and procedures are consistent with the Company’s strategy and risk appetite, that these policies and procedures are effective and functioning as directed, and that management is fostering a culture of risk-aware decision making throughout the organization. Verizon has a robust, formalized business risk management reporting process that is overseen by the Audit Committee and designed to provide visibility to the Board on critical risks and risk mitigation strategies. The Corporate Governance and Policy Committee oversees Verizon’s handling of business and reputational risks relating to Verizon’s position and engagement on important public policy issues, including political contributions, lobbying, corporate social responsibility and sustainability, as well as individual events and incidents that may affect the Company’s reputation. Our Board also regularly receives briefings on cybersecurity, privacy, product-related risks and “lessons learned” from completed mergers and acquisitions.
We believe that a corporation that is purposefully operating at the intersection of economic, environmental and social accountability creates greater long-term value for its shareholders. In 2018, Verizon established a new management body called the Verizon Responsible Business Council, chaired by the CEO, to oversee the integration of responsible practices into our business as a core operating principle. The Chief Corporate Responsibility Officer reports on the Council’s activities to the full Board at least annually.
Our Board recognizes that one of its most important duties is to oversee the development of executive talent and ensure continuity in Verizon’s senior leadership, as well as the efficient succession of the CEO. The Human Resources Committee takes the lead in overseeing succession planning and assignments to key leadership positions, and regularly reports to the full Board during executive sessions. Our Board conducts an annual in-depth review of senior leader development and succession planning to assure that our processes support Verizon’s strategic objectives. In 2018, the appointment of Hans Vestberg as CEO of Verizon was the culmination of a deliberate and thoughtful multi-year planning process.
Learn more about our governance practices in our 2019 proxy statement or on our website at verizon.com/about/investors/sec-filings.