>corporate info>investor relations>Corporate Governance - Committee
  share  print

corporate info

FPO image

About Sears

Corporate Governance - Committee

<< Back


(amended and restated as of November 14, 2011)


In this Charter the following terms have the meaning set out below:

“Affiliate” means the relationship of bodies corporate where one body corporate is the
subsidiary of the other or each of them is a subsidiary of the same body corporate or is
controlled by the same person;

“Board” means the Board of Directors of the Corporation;

“Chair” means the chair of the Committee;

“Chief Executive Officer” or “CEO” means the Chief Executive Officer and/or the
President of the Corporation or the individual holding the highest executive function of the
Corporation appointed by the Board;

“Committee” means the Human Resources and Compensation Committee established by
the Board;

“Corporation” means Sears Canada Inc.;

“Director” means an individual elected to the Board by shareholders of the Corporation, or
appointed to and by the Board;

“SVP HR” means the individual holding the highest executive function of the Department
with the responsibility of Human Resources management;

“Independent Director” means a Director who has no direct or indirect material
relationship with the Corporation or any of its Affiliates, that is, a relationship which would, in
the view of the Board, reasonably interfere with the exercise of the Director’s independent

“Member” means a Director, other than a Director who is also an employee of the
Corporation, appointed to the Committee by the Board;

“Officer” means an officer of the Corporation appointed by the Board, including the
President and CEO, Executive Vice-Presidents and certain Senior Vice-Presidents; and,

“Senior Leadership Team” means all Officers, Senior Vice-Presidents and Vice-
Presidents of the Corporation.


The purpose of the Committee is to assist the Board in its oversight responsibilities relating

(a) the development of the Corporation’s overall human resources strategy for fair and
competitive compensation of the Senior Leadership Team in support of the
achievement of the Corporation’s business strategy, as well as the development of
other significant compensation programs for the benefit of all employees;

(b) the development of the CEO’s goals and objectives and the evaluation of the CEO’s
performance against these goals; and

(c) the succession plan for, and the compensation of, the Senior Leadership Team.


(a) The Committee shall be composed of three or more Members.

(b) Members shall hold office from the time of their appointment until the earlier of their
removal or resignation from the Committee.

(c) One of the Members shall be appointed by the Board as the Chair.

(d) Unless otherwise determined by resolution of the Board, the Secretary of the Board
shall be the Secretary of the Committee. The Secretary of the Committee shall
maintain the records of the Committee.

(e) The Committee shall establish its own procedures, including the timing and place of
meetings, as it considers necessary or advisable.


The main responsibilities of the Chair are as follows:

(a) Call and chair all meetings of the Committee. If the Chair is unavailable or unable to
attend a meeting of the Committee, then the Chair shall request another Member to
chair the meetings. Failing such request, the acting Chair shall be designated by
and from the Members present at the meeting.

(b) Develop the agenda for meetings of the Committee with or without consulting

(c) Hold the right to cast a vote to resolve any ties on matters that require Committee

(d) Update, from time to time, Directors who are not Members, of any significant issues
or deliberations of the Committee.

(e) Act as the primary contact between the Committee and management.

(f) Report to the Board on all meetings and activities of the Committee.

(g) Assume any other responsibilities as this Charter, the Committee or the Board may
specify from time to time.


The Committee shall have the following duties and responsibilities:

A. Compensation Strategy

(1) Approve the Corporation’s compensation and human resources strategy to
ensure that it is aligned to the goals and objectives of the Corporation.

(2) Assess the competitiveness and appropriateness of the Corporation’s
policies relating to the compensation of the Senior Leadership Team as well
as the application of internal equity thereto.

B. Compensation Policies and Practices

(1) Review and approve, at least annually, (i) the design of the Corporation’s
compensation policies and practices, including pension plans and other
benefit plans (perquisite program), Senior Leadership Team base salaries
and all employee-related short and long-term incentive plans together with
performance targets thereunder in support of the Corporation’s business
strategy; (ii) the level of achievement of performance goals at the end of
each plan year or cycle, as confirmed by the Audit Committee of the Board;
and (iii) any incentive plan payments to Senior Leadership Team and, in
summary form, to other eligible plan participants.

(2) Perform such duties and exercise such rights and/or powers as may be
delegated to the Committee pursuant to any of the Corporation’s employee
benefit plans.

(3) Review and approve the compensation arrangements of any executive of
the controlling shareholder of the Corporation who has been seconded to the
Corporation. Such review shall be carried out pursuant to the existing
Executive Compensation and Sharing Agreement made between the
Corporation and Sears Holdings Corporation, with the cost sharing being
subject to such modifications as may be appropriate in the circumstances.

C. Compensation and Appointments

1. CEO

(a) Determine and recommend annually, for approval by the Board, the CEO’s
compensation based on the Committee’s evaluation of the CEO’s

(b) Consider and recommend, for approval by the Board, any

2. Senior Leadership Team

(a) Make recommendations, for approval by the Board, on the proposed
appointment or reassignment of Executive Vice-Presidents and Senior Vice-
Presidents who are Officers of the Corporation.

(b) Review and approve:

(i) at least annually, all compensation of Executive Vice-Presidents and
Senior Vice-Presidents from the Corporation and its subsidiaries, as
well as from any third party with which the Corporation has an
arrangement involving the compensation of an Executive Vice-
President or Senior Vice-President;

(ii) any changes to the compensation of Executive Vice-Presidents and
Senior Vice-Presidents;

(iii) the compensation of any newly appointed Executive Vice-President
and Senior Vice-President; and

report to the Board regarding the foregoing at the Board’s next regularly
scheduled meeting.

(c) Consider and approve any employment-related agreements between the
Corporation and Executive Vice-Presidents and Senior Vice-Presidents who
are Officers of the Corporation, and report its conclusions to the Board at the
Board’s next regularly scheduled meeting.

3. Management

Review and approve annually, in summary form, the aggregate amounts allocated to
management, other than the Senior Leadership Team, pursuant to short and longterm
incentive plans, as applicable.

D. Performance Evaluation and Succession Planning

Review and approve annually the executive organizational structure and the
succession plans for Senior Leadership Team, provided, however, that only the
Board may approve the succession plan for the CEO and appoint Executive Vice-
Presidents and Senior Vice-Presidents.

1. CEO

(a) Establish performance targets and corporate goals and objectives that are
relevant to the CEO’s compensation.

(b) Evaluate annually, with input from non-management Directors, the CEO’s
performance in light of such goals and objectives.

2. Senior Leadership Team

Review the annual performance assessments and succession plans of the Senior
Leadership Team as submitted by the CEO to the Committee.

E. Compensation Disclosure

Review and approve the report of the Committee regarding executive compensation
required to be set forth in the Corporation’s annual Management Proxy Circular.


(1) The Committee shall meet at least two times per year and may meet more often if

(2) The CEO and the SVP HR may attend meetings of the Committee if invited by the
Committee provided, however, that the CEO or the SVP HR may not be present
during deliberations or voting on their respective compensation.

(3) The quorum necessary for the transaction of business at Committee meetings shall
be three Members.

(4) The Committee may meet in person or by telephone and may pass resolutions in
lieu of a meeting, provided such resolutions are signed by every Member.

(5) The Committee shall, as it deems appropriate, hold an in camera session following
each meeting without management.


(1) The Committee shall have the authority to engage external advisors, as it deems
appropriate, to assist the Committee in the performance of its duties. Such external
advisors may attend meetings of the Committee at the request of the Committee.
The Corporation shall cover the costs of such advisors.

(2) The Committee shall have the authority to delegate, as appropriate, certain of its
responsibilities and activities to one or more Members or to a subcommittee of the

(3) The Committee shall review and assess the currency and adequacy of this Charter
on an annual basis and recommend any appropriate changes thereto for approval
by the Board. Notwithstanding the foregoing, the Board has the inherent jurisdiction
to initiate and approve changes to this Charter at any time.

(4) In conjunction with the regular assessment of Board effectiveness, the Board will
review and evaluate the Committee’s performance.

Human Resources and Compensation Committee Charter
As of November 2011