We consider good governance essential to driving our success and building long-term sustainable value for our stakeholders. Our Board of Directors oversees Verizon’s strategic planning and execution, risk management, capital deployment, responsible business practices and human capital management with the assistance of four standing committees composed solely of independent directors. An independent Lead Director shares governance responsibilities with the Chairman and CEO and facilitates forthright communication and effective independent oversight of management’s performance. We are committed to the highest standards of corporate governance and our policies and practices align with the Investor Stewardship Group’s corporate governance principles for U.S. listed companies.
Fostering Board diversity
Good governance starts with independent and engaged directors who have a strong sense of integrity and respect for differing viewpoints. We believe a board that embodies a range of viewpoints, backgrounds and expertise is best positioned to provide new perspectives to our management team as it addresses the challenges and opportunities impacting our business. In its ongoing board refreshment process, our Board seeks a diverse group of candidates who possess the requisite judgment, background, skill, expertise and time, as well as diversity with respect to race, ethnicity and gender, to strengthen and increase the overall diversity, breadth of skills and qualifications of the Board. For the 2019-2020 term, women comprised 30% of our Board, and African-American and Hispanic individuals comprised 40%.
Our Board actively oversees Verizon’s core business strategy. At every Board meeting, our directors engage our senior leaders in robust discussions about Verizon’s strategic goals and challenge them to execute on our strategic plan, address emerging challenges and disruptions and promote innovation. Our Board views our 135,000-plus employees, the V Team, as one of Verizon’s most critical assets and regularly receives briefings from our CEO on initiatives to strengthen our company culture, including the results of the quarterly "Pulse" surveys completed by employees across the company. At the Board’s direction, in 2019 we conducted a comprehensive strategic review of our workforce to identify the capabilities and skills needed to implement our strategy into the future. We are implementing opportunities for our employees to learn new skills that will help them develop individually and grow our business.
Our Board’s committees also do important work overseeing execution on our strategic plan. The Human Resources Committee continually evaluates appropriate compensation structures and levels to incentivize our senior leaders to drive our strategy forward and create long-term shareholder value.
We view Board oversight of Verizon’s risk profile—in its strategic activity, business operations, deployment of capital and environmental and societal impacts—as fundamental to the well-being of our company. Our Board works with management to develop a comprehensive view of Verizon’s key short-term and long-term business risks. Each of the Board’s committees oversees the management of risks that fall within that committee’s purview.
- The Audit Committee oversees our robust, formal enterprise risk management program that identifies the primary risks to Verizon’s business. At least annually, the executives in charge of Verizon’s business groups and key corporate functions review with the Committee the primary risks associated with their particular business group or function. ESG-related risks routinely discussed include those relating to cybersecurity, data privacy and security, network reliability during catastrophic and weather-related events, energy management and our ability to meet our renewable energy and carbon neutral commitments.
- The Corporate Governance and Policy Committee monitors reputational risk. At least annually, our Executive Vice President and Chief Administrative, Legal and Public Policy Officer (CAO) leads a discussion about Verizon’s preparedness to manage potential events that may impact corporate reputation.
- The Finance Committee oversees capital allocation and financial risk management, including the risk related to Verizon’s renewable energy exposure through renewable energy purchase agreements.
- The Human Resources Committee considers the impact of the executive compensation program and of the incentives created by the compensation awards on Verizon’s risk profile.
In its oversight role, our Board emphasizes that risk management is not an impediment to the conduct of business but is instead an integral component of strategy.
Engaging with stakeholders
We believe that engaging openly and transparently with our investors and other stakeholders on issues impacting Verizon, including ESG risks and opportunities, drives increased corporate accountability, improves decision-making and ultimately creates long-term value. During 2019, our Investor Relations, Corporate Governance, ESG, Human Rights and Corporate Responsibility teams met with investors collectively representing a significant portion of our outstanding shares by telephone, in person and at forums and conferences sponsored by the company and third parties. Our independent Lead Director also participated in a number of these meetings. During these interactions, we had meaningful exchanges on a broad range of topics, including business strategy and execution, corporate governance and executive compensation practices, diversity and inclusion initiatives, privacy and data security policies and environmental sustainability efforts.