The Nominating & Governance Committee
The Exchange’s nominating committee is equally balanced between public and participant representatives. Four people serve on the committee – two public directors and two participant directors. Each of the participant directors must be an STP participant director and one of these participant directors must not be a representative of a firm that holds Series A Preferred Stock in CHX Holdings, the Exchange’s parent company. The committee is appointed each year by the Exchange’s Board of Directors.
The nominating committee nominates candidates to positions on the Board of Directors and addresses issues associated with the governance of the Exchange.
The nominating committee typically begins its work early in the year. Under the Exchange’s bylaws, the committee must hold at least two open meetings to allow Exchange participants to recommend potential candidates for STP participant director positions. The committee also consults with both the Exchange’s chairman and CEO about the needs of the Exchange and typically solicits recommendations from other Board members.
Once the nominating committee has held its open meetings, it deliberates in closed sessions. The slate must be approved by a majority vote. Each year, the nominating committee initially identifies candidates for the open STP participant director positions on the Board; the Exchange’s participants can add names to that list by petition. If names are added to the slate, the Exchange’s participants vote on the candidates. The persons receiving the highest number of votes will be elected as STP participant directors on the Board. Public directors and other participant directors are nominated by the nominating committee, but are not subject to the petition process described above.
Other Exchange Committees
Many of the Exchange’s key committees are appointed by the chairman and vice chairman and approved by the Exchange’s Board of Directors. Several of these committees are required, under the Exchange’s rules, to include a careful balance of public and participant representatives.
Executive Committee. The Exchange’s executive committee has most of the powers of the Board when the Board is not in session. It must be composed of at least five Exchange directors, plus the chairman of the Board. A majority of the committee members (including the chairman, if the chairman is a public director) must be public directors.
Regulatory Oversight Committee. The Exchange’s regulatory oversight committee is responsible for overseeing the work of the Exchange’s regulatory programs, including the Exchange’s trading floor surveillance, financial compliance, membership and listings programs. The committee also oversees the work of the Exchange’s enforcement staff. The committee consists of five public directors, one on-floor participant director and one off-floor participant director. These committee members are appointed by the Exchange’s vice chairman and approved by the Board’s public directors.
Audit Committee. Among other things, the Exchange’s audit committee assists the Board of Directors in monitoring the integrity of the Exchange’s financial statements, the Exchange’s systems of internal control and the qualifications, independence and performance of the Exchange’s internal auditor and independent public accountant. At least three people (all directors) must serve on the audit committee and a majority of the committee members must be public directors. The Exchange’s chairman must serve on this committee and the chairman of the committee must be a public director.
Compensation Committee. The Exchange’s compensation committee sets the compensation of the Exchange’s chief executive officer and works with the CEO to determine the compensation of other Exchange officers, as well as a comprehensive corporate compensation and benefits policy for the rest of the Exchange’s staff. The committee must consist of at least three people (all directors), including the Exchange’s chairman. A majority of the compensation committee members must be public directors.
Special quorum requirements. To ensure that the public representatives on these committees have the opportunity to participate in committee meetings, the Exchange’s rules confirm that the executive, audit, compensation and regulatory oversight committees cannot conduct business unless at least half of the public committee members are present or have submitted a specific waiver of their attendance at the meeting.
|Comprehensive Corporate Compensation and Benefits Policy