CORPORATE GOVERNANCE PRINCIPLES
General Mills has a long-standing commitment to good corporate governance practices. These practices provide an
important framework within which our Board of Directors and management can pursue the strategic objectives of
General Mills and ensure its long-term vitality for the benefit of stockholders. Our corporate governance principles
and practices have evolved over many years. The Corporate Governance Committee reviews them annually, and
changes are recommended to the Board for approval as appropriate.
Our Philosophy: Director Election and Independence and Board Composition
Election of Directors. Stockholders elect directors annually. The Board believes that meaningful stockholder
participation is critical to the election of directors. Our directors are elected by a majority of votes cast. If an
incumbent director is not re-elected, the director must promptly offer his or her resignation to the Board. The
Corporate Governance Committee will recommend to the Board whether to accept or reject the resignation, and
the Board will disclose its decision and the rationale behind it within 90 days from the certification of the election
results. When there are more director nominees than the number of directors to be elected, the directors will be
elected by a plurality of the votes cast.
Board Size. The Board periodically reviews the number of director positions with the intent of keeping the Board
small enough to promote substantive discussions in which each director can actively participate, and large enough
to offer a diversity of background and expertise. Our By-laws currently provide that the Board shall have no fewer
than 7 directors and no more than 15 directors.
Board Composition. The Corporate Governance Committee is responsible for recommending candidates for
election to our Board of Directors. The Corporate Governance Committee considers the Board’s overall
composition when it selects candidates. Overall Board composition guidelines require expertise in fields relevant to
the business of the Company; a breadth of experience from a variety of industries and professional disciplines; a
diversity of gender, ethnicity, age and geographic location; and a range of tenures on the Board to ensure both
continuity and fresh perspective. Final approval of director candidates is determined by the full Board, based on
the recommendation of the Corporate Governance Committee.
Director Selection Criteria. Well-defined selection criteria for individual directors require independence,
integrity, experience and sound judgment in areas relevant to our businesses, a proven record of accomplishment,
willingness to speak one’s mind and commit sufficient time to the Board, appreciation for the long-term interests of
stockholders and the ability to challenge and stimulate management and to work well with fellow directors. The
Corporate Governance Committee reviews whether a potential candidate meets Board and/or committee
membership requirements imposed by law, regulation or stock exchange rules, determines whether a potential
candidate is independent according to standards for evaluating director independence and evaluates the potential
for any conflict of interest between the director and General Mills.
Other Board Service. Board members are expected to devote sufficient time and attention to carrying out their
director duties and responsibilities and ensure that their other responsibilities, including service on other boards, do
not materially interfere with their responsibilities as directors of the Company. Directors must inform the Chair of
the Corporate Governance Committee in advance of becoming a director and/or member of the audit committee of
any other public company. The Board will take into account the nature and extent of the director’s other
commitments when determining whether it is appropriate to nominate that individual for re-election. Subject to a
determination by the Board that additional service will not impair the ability of a director to serve effectively on the
Company’s Audit Committee, a member of the Audit Committee should not serve on more than two other audit
committees for public companies.
Director Independence Criteria. The Board believes that a substantial majority of its members should be
independent, non-employee directors. The Board has established the following guidelines that are consistent with
the current listing standards of the New York Stock Exchange for determining director independence:
- A director will not be considered independent if, within the preceding three years,
- The director was an employee of, or an immediate family member of the director was an
executive officer of, General Mills;
- The director or an immediate family member of the director has received during any 12-month
period more than $120,000 in direct compensation from us (other than director fees and pension
or other deferred compensation for prior service to us);
- An executive officer of General Mills was on the compensation committee of a company which, at
the same time, employed the director or an immediate family member of the director as an
executive officer; or
- The director is a current executive officer or employee of, or an immediate family member of the
director is a current executive officer of, another company that does business with us and the annual
payments derived from that business by either company accounts for at least (i) $1,000,000 or (ii)
two percent, whichever is greater, of the consolidated gross revenues of such company.
- A director will not be considered independent if (i) the director or an immediate family member of the
director is a current partner of our independent registered public accounting firm, (ii) the director is a
current employee of our independent registered public accounting firm, (iii) an immediate family member
of the director is a current employee of our independent registered public accounting firm and personally
works on our audit or (iv) the director or an immediate family member of the director was, within the
preceding three years, a partner or employee of our independent registered public accounting firm and
personally worked on our audit within that time.
- The following commercial or charitable relationships are immaterial and will not, by themselves, impair a
director’s independence:
- A director or an immediate family member of the director is an executive officer of another
company which is indebted to us, or to which we are indebted, and the total amount of either
company’s indebtedness to the other is less than two percent of the total consolidated assets of
the company he or she serves as an executive officer;
- A director or an immediate family member of the director serves as an officer, director or trustee
of a tax exempt organization and our contributions to such organization are less than the greater
of (i) $120,000 or (ii) two percent of the organization’s consolidated gross revenues;
- A director or an immediate family member of the director is an executive officer or director of
another company that does business with us and the annual payments derived from that business
by either company accounts for less than (i) $1,000,000 or (ii) two percent, whichever is greater,
of the consolidated gross revenues of such company and the individual is not directly responsible
for or involved in the relationship; or
- A director or an immediate family member holds a less than 10% interest in any entity that has a
relationship with us.
- For relationships not covered by these guidelines, the determination of whether the relationship is material
or not, and therefore whether the director would be independent or not, shall be made by the directors
who satisfy the independence guidelines set forth above. We will explain in our proxy statement the basis
for any determination by the Board that a relationship is not material if the relationship does not satisfy
one of the specific categories of immaterial relationships identified above.
- Audit Committee members may not accept, directly or indirectly, any consulting, advisory or other
compensatory fee from us (other than director fees and pension or other deferred compensation for prior
service to us).
Affiliations with the Company. Director affiliations and transactions are regularly reviewed to ensure there are
no conflicts or relationships that might impair a director’s independence from the Company, senior management
and our independent registered public accounting firm.
Director Retirement Policy. To ensure an appropriate balance between new perspectives and experienced directors:
- Non-employee directors may not be nominated or stand for election after age 72.
- Non-employee directors are expected to offer their resignation whenever they experience a material
change in their principal employment or primary occupation after joining the Board. The Corporate
Governance Committee then recommends to the Board whether the director should continue to serve.
- Company officers who are directors are expected to resign from the Board when they cease to be
employed by us or when there has been a reduction in their employment level, position or responsibilities.
At the request of the non-employee directors, any director who is also the Chief Executive Officer may
continue to serve on the Board for up to three years after his or her retirement.
Director Nominations
The Corporate Governance Committee uses a variety of sources to identify director candidates. From time to time,
the Committee retains a recruitment firm to assist in identifying, evaluating and recruiting director candidates,
based on specified criteria, and pays the firm a fee for these services. Suggestions also are received from Board
members and stockholders. Director candidates recommended to the Corporate Governance Committee are
subject to full Board approval and election by stockholders at an annual meeting of stockholders.
Stockholders who wish to suggest an individual for consideration for election to our Board of Directors may submit
a written nomination to the Corporate Secretary, General Mills, Inc., P.O. Box 1113, Minneapolis, Minnesota 55440,
along with the stockholder’s name, address and the number of General Mills shares beneficially owned; the name
of the individual being nominated and number of General Mills shares beneficially owned by the candidate; the
candidate’s biographical information describing experience and qualifications; a description of all agreements,
arrangements or understandings between the stockholder, any beneficial holder of the stock and the individual
being nominated, including all direct and indirect compensation and other material monetary agreements,
arrangements and understandings during the past three years; and the candidate’s consent to serve as a director,
if elected. To assist in the evaluation of stockholder-recommended candidates, the Committee may request that
the stockholder provide certain additional information required to be disclosed in our proxy statement under
Regulation 14A of the Securities Exchange Act of 1934.
The Committee will consider and evaluate stockholder-recommended candidates by applying the same criteria used
to evaluate director-recommended candidates. If the Committee decides the candidate is suitable for Board
membership, the Committee will make a recommendation to the Board of Directors for its approval to include the
candidate in the slate of directors nominated for election by stockholders in the proxy statement.
Under our By-laws, stockholders may also nominate a candidate for election at an annual meeting of stockholders.
Our annual meeting is typically held on the fourth Monday in September. Stockholders who intend to present a
nomination at our annual meeting are required to notify the Corporate Secretary in writing and provide the
information described above 90 to 120 days preceding the anniversary of the preceding year’s annual stockholders’
meeting. Director nominees submitted through this process will be eligible for election at the stockholder meeting,
but will not be included in proxy materials sent to stockholders prior to the meeting.
Board Performance and Operations
Attendance at Meetings. Directors are expected to attend all Board and committee meetings, as well as the
annual stockholders’ meeting, absent exigent circumstances.
Meeting Agendas and Materials. Board meeting and background materials sent to directors in advance of
meetings focus on our key strategic, leadership and performance issues.
- Each year, the Board has formal reviews and discussions of our annual and longer-term strategic business
plans and management development and succession plans, including an assessment of senior executives
and their potential as successor to the Chief Executive Officer. The Board has adopted procedures to elect
a Chief Executive Officer successor in the event of the Chief Executive Officer’s sudden departure.
- Focused discussions of individual businesses and key issues are held throughout the year, and extended
off-site sessions are held periodically for in-depth reviews of key strategic matters. The Board also
regularly reviews our performance compared to our competitive peer companies.
- Agendas for upcoming Board and committee meetings are regularly reviewed and updated for planning
purposes. The agenda and topics for Board and committee meetings are developed through discussions
between management and Board members. Information and data that are important to the issues to be
considered are distributed in advance of each meeting.
Access to Independent Advisors and Management. The Board and its committees may engage independent
outside financial, legal and other advisors as they deem necessary to provide advice and counsel on various topics
or issues. Directors also have full access to officers and employees.
Board Leadership. The Chairman of the Board is appointed by the Board upon the recommendation of the
Corporate Governance Committee. The Chairman leads the Board and oversees Board meetings and the delivery
of information necessary for the Board’s informed decision-making. The Chairman also serves as the principal
liaison between the Board and our management. The Board determines whether the role of the Chairman and the
CEO should be separated or combined based on their judgment as to the structure that best serves the interests of
the Company. Currently, the Board believes that the positions of Chairman and Chief Executive Officer should be
held by the same person as this combination has served and is serving the Company well by providing unified
leadership and direction.
When the Chairman and Chief Executive Officer roles are combined, the Chair of the Corporate Governance
Committee acts as the presiding director and presides at all Board meetings at which the Chairman is not present,
including executive sessions of the non-employee directors; serves as a liaison between the Chair and the nonemployee
directors; approves Board meeting agendas and consults with the Chairman on information provided to
the Board; approves meeting schedules to assure that there is sufficient time for discussions; calls meetings of the
non-employee directors and sets agendas for executive sessions; and serves as Board representative for
consultation and direct communication with major stockholders on issues that the Board determines may not be
addressed by the Chairman or other Board designees and as otherwise deemed appropriate by the Board. When
the Chairman and Chief Executive Officer roles are separated, and an independent director serves as Chairman,
then he or she will act as presiding director.
Executive Sessions. Non-employee directors have the opportunity to meet in executive session without
management directors present at each Board meeting.
CEO Performance Evaluation. At least annually, the Chair of the Compensation Committee leads an executive
session of the Board where non-employee directors meet formally without management directors present to
evaluate the Chief Executive Officer’s performance. This executive session includes a review of the Chief Executive
Officer’s annual accomplishments, compensation and performance objectives for the next fiscal year. In advance
of the meeting, a formal Chief Executive Officer evaluation is conducted that includes input from all non-employee
directors. Following the executive session, the Chair of the Compensation Committee communicates the results of
the evaluation to the Chief Executive Officer.
Corporate Governance Procedures. The Corporate Governance Committee has responsibility for corporate
governance and Board organization and procedures. The Corporate Governance Committee actively monitors and
discusses evolving corporate governance trends. It reviews our corporate governance practices in light of those
trends and implements those practices that it determines are in the best interests of the Company and consistent
with our long-standing commitment to good corporate governance practices.
Board Evaluations. A formal Board evaluation covering Board operations and performance, with a written
evaluation from each Board member, is conducted annually to enhance Board effectiveness. Recommended
changes are considered by the full Board. In addition, each Board committee conducts an annual self-evaluation.
Director Orientation and Education. New directors participate in an orientation program that includes
discussions with senior management, background materials on our strategic plan, organization and financial
statements and visits to our facilities. Management and outside experts regularly make presentations to the Board on issues relevant to our industry and business, corporate governance trends and other topics of interest to the
directors. We encourage each director to participate in continuing educational programs that are important to
maintaining a director’s level of expertise to perform his or her responsibilities as a Board member, and we
reimburse directors for the cost of attending these programs.
Director Code of Conduct. The Board expects all directors, officers and employees to act with the highest
standards of integrity and adhere to our policies and applicable code of conduct. Directors also are required to
follow our Director Code of Conduct. The Corporate Governance Committee of the Board annually reviews and
oversees compliance with the Director Code of Conduct.
Board of Directors Code of Conduct
Alignment with Stockholder Interests
Stockholder Representation. Each director is expected to represent the interests of all stockholders, and not
those of any particular stockholder or any special interest group.
Director Compensation. A substantial portion of director compensation is linked to our stock performance, and
directors can elect to receive their entire Board remuneration in stock and stock-related compensation. Directors
are expected to keep all of the net shares they receive as compensation until they own shares equal in market
value to at least five times their annual retainer. The Compensation Committee is responsible for periodically
reviewing Board compensation and recommending changes.
Performance-Based Compensation. The Board supports and oversees employee compensation programs that
are closely linked to business performance and emphasize equity ownership, including stock ownership targets, for
key management employees.
Stockholder Communications. Senior management meets regularly with major institutional investors and
stockholders, and reports to the Board on analyst and stockholder views of General Mills.
Committee Performance and Operations
Committee Assignment and Rotation. All Board committees, except the Executive Committee, are composed
entirely of independent, non-employee directors.
- Committee and committee chair assignments are reviewed annually by the Corporate Governance
Committee, which recommends committee rosters to the full Board after considering factors such as the
directors’ business and corporate governance experience, their preferences, the Chairman’s
recommendations, criteria for specific committee service, the directors’ other responsibilities and
scheduling flexibility.
- Assignments are periodically reviewed to ensure that each committee has an appropriate mix of tenure
and experience in order to introduce fresh perspectives while preserving continuity. The Corporate
Governance Committee may adopt guidelines for committee tenure, but there is no mandatory rotation
schedule.
- Committee responsibilities are detailed in their charters, and the committees annually review their
charters and prepare master agendas to ensure sufficient time and opportunity to address all
responsibilities. Reports of committee meetings are given to the full Board, which acts on their
recommendations, as appropriate.
Audit Committee
Audit Committee Charter
Our Audit Committee is made up of independent, non-employee directors. Each member is an independent
director under our guidelines and as defined by the New York Stock Exchange listing standards for Audit Committee membership. Each member also meets the independence standards for audit committee membership under the
rules of the Securities and Exchange Commission. The Committee
- Oversees integrity, adequacy and effectiveness of internal controls, audits, financial reporting processes
and the compliance programs, including the Employee Code of Conduct;
- Assesses and ensures the independence, qualifications and performance of our independent registered
public accounting firm, selects the independent registered public accounting firm for the annual audit and
approves the independent registered public accounting firm’s services and fees;
- Meets with the independent registered public accounting firm, without management present, to consult
with it and review the scope of its audit;
- Reviews our annual risk assessment process and policy compliance;
- Reviews and approves our annual audited financial statements before issuance, subject to the Board of
Directors’ approval; and
- Reviews the performance of the internal audit function.
Compensation Committee
Compensation Committee Charter
Our Compensation Committee is made up of independent, non-employee directors under our guidelines and as
defined by the New York Stock Exchange listing standards. The Committee
- Reviews compensation policies for executive officers and employees to ensure they provide appropriate
motivation for corporate performance and increased stockholder value;
- Conducts performance reviews of the Chief Executive Officer;
- Approves the compensation and equity awards for the Chief Executive Officer and other senior executives;
- Recommends the compensation and equity awards for the non-employee directors; and
- Reviews and discusses with management the Compensation Discussion and Analysis and recommends its
inclusion in the proxy statement.
Corporate Governance Committee
Corporate Governance Committee Charter
Our Corporate Governance Committee is made up of independent, non-employee directors under our guidelines
and as defined by the New York Stock Exchange listing standards. The Committee
- Recommends candidates for election to the Board;
- Develops policy on composition, participation and size of the Board as well as tenure and retirement of
directors;
- Monitors and recommends changes in the organization and procedures of the Board, including committee
appointments and corporate governance policies;
- Oversees the Board self-evaluation process; and
- Reviews and approves transactions between General Mills and related persons
Executive Committee
When appointed by the Board, the Committee
- May take all action that could be taken by the full Board, other than those for which Delaware law requires
full Board action; and
- May meet between regular Board meetings to take action necessary for General Mills to operate
efficiently.
The Board has not appointed an Executive Committee for fiscal 2009.
Finance Committee
Finance Committee Charter
Our Finance Committee is made up of independent, non-employee directors under our guidelines and as defined by
the New York Stock Exchange listing standards. The Committee
- Reviews financial policies and performance objectives, including dividend policy;
- Reviews changes in our capital structure, including debt issuances, common stock sales, repurchases and
stock splits; and
- Reviews the annual business plan and related financing implications
Public Responsibility Committee
Public Responsibility Committee Charter
The Public Responsibility Committee is made up of independent, non-employee directors under our guidelines and
as defined by the New York Stock Exchange listing standards. The Committee
- Reviews public policy and social trends affecting General Mills;
- Monitors our corporate citizenship activities;
- Evaluates our policies to ensure they meet ethical obligations to employees, consumers and society; and
- Reviews our policies governing political contributions and our record of contributions.
Communications with the Board
Interested parties may contact any of our directors by writing to the Board of Directors or to the Corporate
Secretary, General Mills, Inc., P.O. Box 1113, Minneapolis, Minnesota 55440 or via e-mail at
boardofdirectors@genmills.com. The Board of Directors has instructed the Corporate Secretary to distribute
communications to a director or directors, after ascertaining whether the communications are appropriate to duties
and responsibilities of the Board. The Board has requested that the Corporate Secretary not forward the following
types of communications: general surveys and mailings to solicit business or advertise products, job applications or
resumes, product inquiries or complaints, new product suggestions or any material that is threatening, illegal or
does not relate to the responsibilities of the Board.
