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This excerpt taken from the EBAY DEF 14A filed Mar 19, 2009. OUR
CORPORATE GOVERNANCE PRACTICES
We believe that open, effective, and accountable corporate
governance practices are key to our relationship with our
stockholders. To help our stockholders understand our commitment
to this relationship and our governance practices, the Board has
adopted a set of governance guidelines to set a framework within
which the Board will conduct its business. The governance
guidelines can be found on our website at
http://investor.ebay.com/governance
and are summarized below along with certain other of our
governance practices.
Committee Responsibilities. Board committees
help the Board run effectively and efficiently, but do not
replace the oversight of the Board as a whole. There are
currently three principal Board committees: the Audit Committee,
the Compensation Committee, and the Corporate Governance and
Nominating Committee. Each committee meets regularly and has a
written charter that has been approved by the Board. In
addition, at each regularly scheduled Board meeting, a member of
each committee reports on any significant matters addressed by
the committee since the last Board meeting. Each committee
performs an annual self-assessment to evaluate its effectiveness
in fulfilling its obligations.
Independence. The rules of The Nasdaq Stock
Market require listed companies to have a board of directors
with at least a majority of independent directors. These rules
have both objective tests and a subjective test for determining
who is an “independent director.” The objective tests
state, for example, that a director is not considered
independent if he or she is an employee of the company, or is a
partner in, or a controlling shareholder or executive officer
of, an entity to which the company made, or from which the
company received, payments in the current or any of the past
three fiscal years that exceed 5% of the recipient’s
consolidated gross revenue for that year. The subjective test
requires our Board to affirmatively determine that the director
does not have a relationship that would interfere with the
director’s exercise of independent judgment in carrying out
his or her responsibilities. On an annual basis, each member of
our Board is required to complete an independence questionnaire
designed to provide information to assist the Board in
determining whether the director is independent under the
listing standards of the Nasdaq Global Select Market and our
corporate governance guidelines. Our Board has adopted
guidelines setting forth certain categories of transactions,
relationships, and arrangements that it has deemed immaterial
for purposes of making its determination regarding a
director’s independence, and does not consider any such
transactions, relationships, and arrangements in making its
subjective determination.
Our Board has determined that each of the following directors is
independent under the listing standards of the Nasdaq Global
Select Market: Mr. Anderson, Mr. Andreessen,
Mr. Barnholt, Mr. Bourguignon, Mr. Cook,
Mr. Ford, Ms. Lepore, Mr. Moffett,
Mr. Schlosberg, and Mr. Tierney. Also, our Board
determined that Mr. Kagle, who served as a director until
his term expired upon the conclusion of our 2008 Annual Meeting
of Stockholders held on June 19, 2008, was independent
under the listing standards of the Nasdaq Global Select Market.
In making this assessment, the Board considered the
transactions, relationships, and arrangements described under
the heading “Certain Transactions with Directors and
Officers” below. In addition, certain of our directors
serve as members of the board of directors for the same company
or have investments in venture funds where another director
serves as a general partner. The Board was aware of these
relationships when it made its determination.
Table of Contents
The Board limits membership on the Audit Committee, the
Compensation Committee, and the Corporate Governance and
Nominating Committee to independent directors. Our governance
guidelines require any director who has previously been
determined to be independent to inform the Chairman of the Board
and our Corporate Secretary of any change in circumstance that
may cause his or her status as an independent director to change.
Lead Independent Director. Our Board has a
designated lead independent director who chairs and may call
formal closed sessions of the independent directors, leads Board
meetings in the absence of the Chairman, and leads the annual
Board self-assessment. In addition, the lead independent
director, together with the chair of the Corporate Governance
and Nominating Committee, conducts interviews to confirm the
continued qualification and willingness to serve of each
director whose term is expiring at an annual meeting prior to
the time at which directors are nominated for re-election.
Mr. Barnholt is currently the lead independent director,
having been appointed to a two-year term in June 2008. He will
serve as lead independent director until the Board meeting
following our 2010 Annual Meeting of Stockholders.
Stockholder Communication. Stockholders may
communicate with the Board or individual directors care of the
Corporate Secretary, eBay Inc., 2145 Hamilton Avenue,
San Jose, California 95125. The Corporate Governance and
Nominating Committee has delegated responsibility for initial
review of stockholder communications to our Corporate Secretary.
In accordance with the committee’s instructions, our
Corporate Secretary will summarize all correspondence and make
it available to each member of the Board. In addition, the
Corporate Secretary will forward copies of all stockholder
correspondence to each member of the Corporate Governance and
Nominating Committee, except for communications that are
(1) advertisements or promotional communications,
(2) solely related to complaints by users with respect to
ordinary course of business customer service and satisfaction
issues, or (3) clearly unrelated to our business, industry,
management, or Board or committee matters.
Attendance at Annual Meetings. Absent exigent
circumstances, all directors are expected to attend eBay’s
annual meeting of stockholders. All of our directors serving on
our Board at the time of our last annual meeting of
stockholders, which was held in June 2008, attended such meeting
except for Mr. Kagle, whose term as a director expired upon
the conclusion of that meeting.
Formal Closed Sessions. At the conclusion of
each regularly scheduled Board meeting, the outside directors
have the opportunity to meet without our management or the other
directors. The lead independent director leads the discussions.
Board Compensation. Board compensation is
determined by the Compensation Committee. Since 2003, Board
compensation has consisted of a mixture of equity compensation
and cash compensation. Board compensation is reviewed annually
by the Compensation Committee. A more detailed description of
current Board compensation can be found under the heading
“Compensation of Directors” below.
Stock Ownership Guidelines. In September 2004,
our Board adopted stock ownership guidelines to better align the
interests of our directors and executive officers with the
interests of our stockholders and further promote our commitment
to sound corporate governance. Under these guidelines, our
executive officers are required to achieve ownership of eBay
common stock valued at three times their annual base salary
(five times in the case of our Chief Executive Officer, or CEO).
The guidelines provide that the required ownership level for
each executive officer is re-calculated whenever an executive
officer changes pay grade, and as of January 1 of every third
year. Until an executive officer achieves the required level of
ownership, he or she is required to retain 25% of the after-tax
net shares received as the result of the exercise of eBay stock
options or the vesting of restricted stock or restricted stock
units. Directors are required to achieve ownership of eBay
common stock valued at three times the amount of the annual
retainer paid to directors within three years of joining the
Board, or in the case of directors serving at the time the
guidelines were adopted, within three years of the date of
adoption of the guidelines. A more detailed summary of our stock
ownership guidelines can be found on our website at
http://investor.ebay.com/governance.
The ownership levels of our executive officers and directors as
of March 3, 2009 are set forth in the section entitled
“Security Ownership of Certain Beneficial Owners and
Management” below.
Outside Advisors. The Board and each of its
principal committees may retain outside advisors and consultants
of their choosing at the company’s expense. The Board need
not obtain management’s consent to
Table of Contents
retain outside advisors. In addition, the principal committees
need not obtain either the Board’s or management’s
consent to retain outside advisors.
Conflicts of Interest. eBay expects its
directors, executives, and employees to conduct themselves with
the highest degree of integrity, ethics, and honesty.
eBay’s credibility and reputation depend upon the good
judgment, ethical standards, and personal integrity of each
director, executive, and employee. In order to better protect
eBay and its stockholders, eBay regularly reviews its Code of
Conduct and related policies to ensure that it provides clear
guidance to its directors, executives, and employees.
Transparency. eBay believes it is important
that stockholders understand the governance practices of eBay.
In order to help ensure the transparency of our practices, we
have posted information regarding our corporate governance
procedures on our website at
http://investor.ebay.com/governance.
Board Effectiveness and Director Performance
Reviews. It is important to eBay that the Board
and its committees are performing effectively and in the best
interest of the company and its stockholders. The Board performs
an annual self-assessment, led by the lead independent director,
to evaluate its effectiveness in fulfilling its obligations. As
part of this annual self-assessment, directors are able to
provide feedback on the performance of other directors. The lead
independent director then follows up on this feedback and takes
such further action with directors receiving comments and other
directors as he or she deems appropriate.
Succession Planning. The Board recognizes the
importance of effective executive leadership to eBay’s
success. eBay conducts an annual review process that includes
succession plans for eBay’s senior leadership positions.
These succession plans are reviewed and approved by our CEO, and
details on these succession plans, including potential
successors for members of eBay’s executive staff (including
the CEO), are presented to the Board. In addition, the Board
reviews and updates eBay’s CEO succession plan, which
includes formal criteria for the CEO position used to evaluate
potential successors and addresses the possibility of an
emergency situation. In conducting this review, the Board
considers, among other factors, organizational and operational
needs, competitive challenges and leadership/management
potential and development.
Auditor Independence. eBay has taken a number
of steps to ensure continued independence of its outside
auditors. eBay’s independent auditors report directly to
the Audit Committee, and eBay limits the use of its auditors for
non-audit services. The fees for services provided by
eBay’s auditors in 2008 and 2007 and eBay’s policy on
pre-approval of non-audit services are described under
“Proposal 4 — Ratification of Selection of
Independent Auditors” below.
Corporate Hotline. eBay has established a
corporate hotline (operated by a third party) to allow any
employee to confidentially and anonymously lodge a complaint
about any accounting, internal control, auditing, or (where
legally permissible) other matters of concern.
This excerpt taken from the EBAY DEF 14A filed Apr 28, 2008. OUR
CORPORATE GOVERNANCE PRACTICES
We believe open, effective, and accountable corporate governance
practices are key to our relationship with our stockholders. To
help our stockholders understand our commitment to this
relationship and our governance practices, the Board has adopted
a set of governance guidelines to set a framework within which
the Board will conduct its business. The governance guidelines
can be found on our website at
http://investor.ebay.com/governance and are summarized
below along with certain other of our governance practices.
Committee Responsibilities. Board committees
help the Board run effectively and efficiently, but do not
replace the oversight of the Board as a whole. There are
currently three principal committees: the Audit Committee, the
Compensation Committee, and the Corporate Governance and
Nominating Committee. Each committee meets regularly and has a
written charter that has been approved by the Board. In
addition, at each regularly scheduled Board meeting, a member of
each committee reports on any significant matters addressed by
the committee since the last Board meeting. Each committee
performs an annual self-assessment to evaluate its effectiveness
in fulfilling its obligations.
Independence. Nasdaq rules require listed
companies to have a board of directors with at least a majority
of independent directors. Nasdaq rules have both objective tests
and a subjective test for determining who is an
“independent director.” The objective tests state, for
example, that a director is not considered independent if he or
she is an employee of the company, or is a partner in, or a
controlling shareholder or executive officer of, an entity to
which the company made, or from which the company received,
payments in the current or any of the past three fiscal years
that exceed 5% of the recipient’s consolidated gross
revenue for that year. The subjective test requires our Board to
affirmatively determine that the director does not have a
relationship that would interfere with the director’s
exercise of independent judgment in carrying out his or her
responsibilities. On an annual basis, each member of our Board
is required to complete an independence questionnaire designed
to provide information to assist the Board in determining
whether the director is independent under Nasdaq rules and our
corporate governance guidelines. Our Board has adopted
guidelines setting forth certain categories of transactions,
relationships, and arrangements that it has deemed immaterial
for purposes of making its determination regarding a
director’s independence, and does not consider any such
transactions, relationships, and arrangements in making its
subjective determination.
Our Board has determined that each of the following directors is
independent under the listing standards of the Nasdaq Global
Select Market: Mr. Anderson, Mr. Barnholt,
Mr. Bourguignon, Mr. Cook, Mr. Ford,
Mr. Kagle, Ms. Lepore, Mr. Moffett,
Mr. Schlosberg, and Mr. Tierney. In making this
assessment, the Board considered the transactions,
relationships, and arrangements described under the heading
“Certain Transactions with Directors and Officers”
below. In addition, certain of our directors serve as members of
the board of directors for the same company or have investments
in venture funds where another director serves as a general
partner. The Board was aware of these relationships when it made
its determination.
The Board limits membership on the Audit Committee, the
Compensation Committee, and the Corporate Governance and
Nominating Committee to independent directors. Our governance
guidelines require any director
Table of Contents
who has previously been determined to be independent to inform
the Chairman of the Board and our Corporate Secretary of any
change in circumstance that may cause his or her status as an
independent director to change.
Lead Independent Director. Our Board has a
designated lead independent director who chairs and may call
formal closed sessions of the independent directors, leads Board
meetings in the absence of the Chairman, and leads the annual
Board self-assessment. In addition, the lead independent
director, together with the chair of the Corporate Governance
and Nominating Committee, conducts interviews to confirm the
continued qualification and willingness to serve of each
director whose term is expiring at an annual meeting prior to
the time at which directors are nominated for re-election.
Mr. Tierney is currently the lead independent director and
will serve as lead independent director until his two-year term
expires at the Board meeting following our 2008 Annual Meeting
of Stockholders. Mr. Barnholt has been appointed as the
lead independent director for a two-year term beginning at the
Board meeting following our 2008 Annual Meeting of Stockholders.
Stockholder Communication. Stockholders may
communicate with the Board or individual directors care of the
Corporate Secretary, eBay Inc., 2145 Hamilton Avenue,
San Jose, California 95125. The Corporate Governance and
Nominating Committee has delegated responsibility for initial
review of stockholder communications to our Corporate Secretary.
In accordance with the committee’s instructions, our
Corporate Secretary will summarize all correspondence and make
it available to each member of the Board. In addition, the
Corporate Secretary will forward copies of all stockholder
correspondence to each member of the Corporate Governance and
Nominating Committee, except for communications that are
(a) advertisements or promotional communications,
(b) solely related to complaints by users with respect to
ordinary course of business customer service and satisfaction
issues, or (c) clearly unrelated to our business, industry,
management, or Board or committee matters.
Attendance at Annual Meetings. Absent exigent
circumstances, all directors are expected to attend the
company’s annual meeting of stockholders. All of our
directors at the time of our last annual meeting of
stockholders, which was held in June 2007, attended such meeting.
Formal Closed Sessions. At the conclusion of
each regularly scheduled Board meeting, the outside directors
have the opportunity to meet without our management or the other
directors. The lead independent director leads the discussions.
Board Compensation. Board compensation is
determined by the Compensation Committee. Since 2003, Board
compensation has consisted of a mixture of equity compensation
and cash compensation. Board compensation is reviewed annually
by the Compensation Committee. As of July 2007, the Compensation
Committee increased fees payable for committee meetings and to
our lead director and committee chairs and changed the annual
equity component of Board compensation. A more detailed
description of current Board compensation can be found under the
heading “Compensation of Directors” below.
Stock Ownership Guidelines. In September 2004,
our Board adopted stock ownership guidelines to better align the
interests of our directors and executive officers with the
interests of our stockholders and further promote our commitment
to sound corporate governance. Under these guidelines, our
executive officers are required to achieve ownership of eBay
common stock valued at three times their annual base salary
(five times in the case of our Chief Executive Officer, or CEO).
The guidelines provide that the required ownership level for
each executive officer is re-calculated whenever an executive
officer changes pay grade, and as of January 1 of every third
year. Until an executive officer achieves the required level of
ownership, he or she is required to retain 25% of the after-tax
net shares received as the result of the exercise of eBay stock
options or the vesting of restricted stock or restricted stock
units. Directors are required to achieve ownership of eBay
common stock valued at three times the amount of the annual
retainer paid to directors within three years of joining the
Board, or in the case of directors serving at the time the
guidelines were adopted, within three years of the date of
adoption of the guidelines. A more detailed summary of our stock
ownership guidelines can be found on our website at
http://investor.ebay.com/governance. The ownership levels
of our executive officers and directors as of April 22,
2008 are set forth in the section entitled “Security
Ownership of Certain Beneficial Owners and Management”
below.
Outside Advisors. The Board and each of its
principal committees may retain outside advisors and consultants
of their choosing at the company’s expense. The Board need
not obtain management’s consent to
Table of Contents
retain outside advisors. In addition, the principal committees
need not obtain the Board’s or management’s consent to
retain outside advisors.
Conflicts of Interest. eBay expects its
directors, executives, and employees to conduct themselves with
the highest degree of integrity, ethics, and honesty.
eBay’s credibility and reputation depend upon the good
judgment, ethical standards, and personal integrity of each
director, executive, and employee. In order to better protect
eBay and its stockholders, eBay regularly reviews its Code of
Conduct to ensure that it provides clear guidance to its
directors, executives, and employees.
Transparency. eBay believes it is important
that stockholders understand the governance practices of eBay.
In order to help ensure the transparency of our practices, we
have posted information regarding our corporate governance
procedures on our website at
http://investor.ebay.com/governance.
Board Effectiveness and Director Performance
Reviews. It is important to eBay that the Board
and its committees are performing effectively and in the best
interest of the company and its stockholders. The Board performs
an annual self-assessment, led by the lead independent director,
to evaluate its effectiveness in fulfilling its obligations. As
part of this annual self-assessment, directors are able to
provide feedback on the performance of other directors. The lead
independent director then follows up on this feedback and takes
such further action with directors receiving comments and other
directors as he or she deems appropriate.
Succession Planning. The Board recognizes the
importance of effective executive leadership to eBay’s
success, and meets to discuss executive succession planning at
least annually. As part of this process, the Board reviews the
capabilities of the company’s senior leadership as set out
in written succession planning documents and identifies and
discusses potential successors for members of the company’s
executive staff, including the CEO. The Board was actively
involved in the management succession announced in January 2008.
Auditor Independence. eBay has taken a number
of steps to ensure continued independence of its outside
auditors. eBay’s independent auditors report directly to
the Audit Committee, and eBay limits the use of its auditors for
non-audit services. The fees for services provided by
eBay’s auditors in 2007 and 2006 and eBay’s policy on
pre-approval
of non-audit services are described under Proposal 3 below.
Corporate Hotline. eBay has established a
corporate hotline (operated by a third party) to allow any
employee to confidentially and anonymously lodge a complaint
about any accounting, internal control, auditing, or (where
legally permissible) other matter of concern.
This excerpt taken from the EBAY DEF 14A filed Apr 30, 2007. OUR
CORPORATE GOVERNANCE PRACTICES
We believe open, effective, and accountable corporate governance
practices are key to our relationship with our stockholders. To
help our stockholders understand our commitment to this
relationship and our governance practices, the Board has adopted
a set of governance guidelines to set a framework within which
the Board will conduct its business. The governance guidelines
can be found on our website at
http://investor.ebay.com/governance and are summarized
below along with certain other of our governance practices.
Committee Responsibilities. Board committees
help the Board run effectively and efficiently, but do not
replace the oversight of the Board as a whole. There are
currently three principal committees: the Audit Committee, the
Compensation Committee, and the Corporate Governance and
Nominating Committee. Each committee meets regularly and has a
written charter that has been approved by the Board. In
addition, at each regularly scheduled Board meeting, a member of
each committee reports on any significant matters addressed by
the committee. Each committee performs an annual self-assessment
to evaluate its effectiveness in fulfilling its obligations.
Independence. Nasdaq rules require listed
companies to have a board of directors with at least a majority
of independent directors. Under Nasdaq’s rules, in order
for a director to be deemed independent, our Board must
determine that the individual does not have a relationship that
would interfere with the director’s exercise of independent
judgment in carrying out his or her responsibilities. Our Board
has adopted guidelines setting forth categories of relationships
that it has deemed immaterial for purposes of making a
determination regarding a director’s independence. On an
annual basis, each member of our Board is required to complete
an independence questionnaire designed to provide information to
assist the Board in determining whether the director is
independent under Nasdaq rules and our corporate governance
guidelines. Our Board has determined that each of our directors,
other than Ms. Whitman and Mr. Omidyar, is independent
under the listing standards of the Nasdaq Global Select Market.
Our governance guidelines require any director who has
previously been determined to be independent to inform the
Chairman of the Board and our Corporate Secretary of any change
in circumstance that may cause his or her status as an
independent director to change. The Board limits membership on
the Audit Committee, the Compensation Committee, and the
Corporate Governance and Nominating Committee to independent
directors.
Lead Independent Director. Our Board has a
designated lead independent director who chairs and can call
formal closed sessions of the outside directors, leads Board
meetings in the absence of the Chairman, and leads the annual
Board self-assessment. In addition, the lead independent
director, together with the chair of the Corporate Governance
and Nominating Committee, conducts interviews to confirm the
continued qualification and willingness to serve of each
director whose term is expiring at an annual meeting prior to
the time at which directors are nominated for re-election.
Mr. Tierney is currently the lead independent director,
having been appointed to a second two-year term in 2006. He will
serve as lead independent director until the Board meeting
following our 2008 Annual Meeting of Stockholders.
Stockholder Communication. Stockholders may
communicate with the Board or individual directors care of the
Corporate Secretary, eBay Inc., 2145 Hamilton Avenue,
San Jose, California 95125. The Corporate Governance
Table of Contents
and Nominating Committee has delegated responsibility for
initial review of stockholder communications to our Corporate
Secretary. In accordance with the committee’s instructions,
our Corporate Secretary will summarize all correspondence and
make it available to each member of the Board. In addition, the
Corporate Secretary will forward copies of all stockholder
correspondence to each member of the Corporate Governance and
Nominating Committee, except for communications that are
(a) advertisements or promotional communications,
(b) solely related to complaints by users with respect to
ordinary course of business customer service and satisfaction
issues, or (c) clearly unrelated to our business, industry,
management, or Board or committee matters.
Attendance at Annual Meetings. Absent exigent
circumstances, all directors are expected to attend the
company’s annual meeting of stockholders. Ten of our eleven
directors attended our annual meeting of stockholders in 2006.
Formal Closed Sessions. At the conclusion of
each regularly scheduled Board meeting, the outside directors
have the opportunity to meet without our management or the other
directors. The lead independent director leads the discussions.
Board Compensation. Board compensation is
determined by the Compensation Committee. Since 2003, Board
compensation has consisted of a mixture of equity compensation
and cash compensation. Board compensation is reviewed annually
by the Compensation Committee, which has not changed cash
compensation since 2003 and has effectively reduced equity
compensation by holding the number of options granted annually
to the same absolute number notwithstanding two subsequent stock
splits. Current Board compensation is described under the
heading “Compensation of Directors” below.
Stock Ownership Guidelines. In September 2004,
our Board adopted stock ownership guidelines to better align the
interests of our directors and executives with the interests of
our stockholders and further promote our commitment to sound
corporate governance. Under these guidelines, our executive
officers are required to achieve ownership of eBay common stock
valued at three times their annual base salary (five times in
the case of our Chief Executive Officer, or CEO). The guidelines
provide that the required ownership level for each executive
officer is re-calculated whenever an executive officer changes
pay grade, and as of January 1 of every third year. Until an
executive achieves the required level of ownership, he or she is
required to retain 25% of the after-tax net shares received as
the result of the exercise of eBay stock options or the vesting
of restricted stock or restricted stock units. Directors are
required to achieve ownership of eBay common stock valued at
three times the amount of the annual retainer paid to directors
within three years of joining the Board, or in the case of
directors serving at the time the guidelines were adopted,
within three years of the date of adoption of the guidelines. A
more detailed summary of our stock ownership guidelines can be
found on our website at
http://investor.ebay.com/governance. All of our directors
and all of our executive officers who began their employment
with eBay prior to January 1, 2005 have achieved the level
of stock ownership required under the guidelines. The ownership
levels of our executives and directors as of March 30, 2007
are set forth in the section entitled “Security Ownership
of Certain Beneficial Owners and Management” below.
Outside Advisors. The Board and each of its
committees may retain outside advisors and consultants of their
choosing at the company’s expense. The Board need not
obtain management’s consent to retain outside advisors.
Conflicts of Interest. eBay expects its
directors, executives, and employees to conduct themselves with
the highest degree of integrity, ethics, and honesty.
eBay’s credibility and reputation depend upon the good
judgment, ethical standards and personal integrity of each
director, executive, and employee. In order to better protect
eBay and its stockholders, eBay regularly reviews its Code of
Conduct to ensure that it provides clear guidance to its
employees and directors. The Code of Conduct was most recently
updated in October 2005.
Transparency. eBay believes it is important
that stockholders understand the governance practices of eBay.
In order to help ensure the transparency of our practices, we
have posted information regarding our corporate governance
procedures on our website at
http://investor.ebay.com/governance.
Board Effectiveness and Director Performance
Reviews. It is important to eBay that the Board
and its committees are performing effectively and in the best
interest of the company and its stockholders. The Board performs
an annual self-assessment, led by the lead independent director,
to evaluate its effectiveness in fulfilling its obligations. As
part of this annual self-assessment, directors are able to
provide feedback on the performance of
Table of Contents
other directors. The lead independent director then follows up
on this feedback and takes such further action with directors
receiving comments and other directors as he deems appropriate.
Succession Planning. The Board recognizes the
importance of effective executive leadership to eBay’s
success, and meets to discuss executive succession planning at
least annually. As part of this process, the Board reviews the
capabilities of the company’s senior leadership as set out
in written succession planning documents and identifies and
discusses potential successors for members of the company’s
executive staff, including the CEO.
Auditor Independence. eBay has taken a number
of steps to ensure continued independence of our outside
auditors. Our independent auditors report directly to the Audit
Committee, and we limit the use of our auditors for non-audit
services. The fees for services provided by our auditors in 2006
and 2005 and our policy on pre-approval of non-audit services
are described under Proposal 4 below.
Corporate Hotline. eBay has established a
corporate hotline to allow any employee to confidentially and
anonymously lodge a complaint about any accounting, internal
control, auditing, or other matter of concern.
This excerpt taken from the EBAY DEF 14A filed Apr 26, 2006. OUR
CORPORATE GOVERNANCE PRACTICES
We believe open, effective, and accountable corporate governance
practices are key to our relationship with our stockholders. To
help our stockholders understand our commitment to this
relationship and our governance practices, several of our key
governance initiatives are summarized below.
Governance Guidelines. The Board has adopted a
set of governance guidelines to set a framework within which the
Board will conduct its business. The governance guidelines can
be found on our website at
http://investor.ebay.com/governance
and are summarized below.
Committee Responsibilities. Board committees
help the Board run effectively and efficiently, but do not
replace the oversight of the Board as a whole. There are
currently three principal committees: the Audit Committee, the
Compensation Committee, and the Corporate Governance and
Nominating Committee. Each committee meets regularly and has a
written charter that has been approved by the Board. In
addition, at each regularly scheduled Board meeting, a member of
each committee reports on any significant matters addressed by
the committee. Each committee performs an annual self-assessment
to evaluate its effectiveness in fulfilling its obligations.
Independence. Nasdaq rules require listed
companies to have a board of directors with at least a majority
of independent directors. Our Board has determined that nine of
our eleven directors are independent under the listing standards
of the Nasdaq Stock Market. The Board limits membership on the
Audit Committee, the Compensation Committee, and the Corporate
Governance and Nominating Committee to independent non-employee
directors. In addition, the Board has a designated lead
independent director who chairs and can call formal closed
sessions of outside directors, leads Board meetings in the
absence of the Chairman, and leads the annual Board
self-assessment. Mr. Tierney is currently the lead
independent director, and was recently reappointed to the
position for a second two-year term. He will serve as lead
independent director until the Board meeting following our
2008 Annual Meeting of Stockholders.
Stockholder Communication. Stockholders may
communicate with the Board of Directors or individual directors
care of the Corporate Secretary, eBay Inc., 2145 Hamilton
Avenue, San Jose, California 95125. The Corporate
Governance and Nominating Committee has delegated responsibility
for initial review of stockholder communications to our
Corporate Secretary. In accordance with the committee’s
instructions, our Corporate Secretary will summarize all
correspondence and make it available to each member of the
Board. In addition, the Corporate Secretary will forward copies
of all stockholder correspondence to each member of the
Corporate Governance and Nominating Committee, except for
communications that are (a) advertisements or promotional
communications, (b) solely related to complaints by users
with respect to ordinary course of business customer service and
satisfaction issues, or (c) clearly unrelated to our
business, industry, management, or Board or committee matters.
Attendance at Annual Meetings. Absent exigent
circumstances, all directors are expected to attend the
company’s annual meeting of stockholders. Nine of the ten
directors who were then on the Board attended our 2005 Annual
Meeting of Stockholders.
Table of Contents
Formal Closed Sessions. At the conclusion of
each regularly scheduled Board meeting, the outside directors
have the opportunity to meet without our management or the other
directors. The lead independent director leads the discussions.
Board Compensation. Board compensation is
determined by the Compensation Committee. Prior to 2003, Board
compensation was 100% equity based. After a review, in December
2002, Board compensation was substantially revised by the Board,
with equity compensation reduced and cash compensation added.
Board compensation has subsequently been reviewed annually by
the Compensation Committee, which has not changed cash
compensation and has effectively reduced equity compensation by
holding the number of options granted annually to the same
absolute number notwithstanding two subsequent stock splits.
Current Board compensation is described under the heading
“Executive Compensation — Compensation of
Directors” below.
Stock Ownership Guidelines. In September 2004,
our Board adopted stock ownership guidelines to better align the
interests of our directors and executives with the interests of
stockholders and further promote our commitment to sound
corporate governance. Under the guidelines, our executive
officers are required to achieve ownership of eBay common stock
valued at three times their annual base salary (five times in
the case of our Chief Executive Officer). Until an executive
achieves the required level of ownership, he or she is required
to retain 25% of the net shares received as the result of the
exercise of eBay stock options. Directors are required to
achieve ownership of eBay common stock valued at three times the
amount of the annual retainer paid to directors within three
years of joining the Board, or in the case of directors serving
at the time the guidelines were adopted, within three years of
the date of adoption of the guidelines. A more detailed summary
of our stock ownership guidelines can be found on our website at
http://investor.ebay.com/governance. The ownership levels
of our executives and directors as of April 1, 2006 are set
forth in the section entitled “Security Ownership of
Certain Beneficial Owners and Management” below.
Outside Advisors. The Board and each of its
committees may retain outside advisors and consultants of their
choosing at the company’s expense. The Board need not
obtain management’s consent to retain outside advisors.
Conflicts of Interest. eBay expects its
directors, executives, and employees to conduct themselves with
the highest degree of integrity, ethics, and honesty.
eBay’s credibility and reputation depend upon the good
judgment, ethical standards and personal integrity of each
director, executive, and employee. In order to better protect
eBay and its stockholders, eBay regularly reviews its Code of
Conduct to ensure that it provides clear guidance to its
employees and directors. The Code of Conduct was most recently
updated in October 2005.
Transparency. eBay believes it is important
that stockholders understand the governance practices of eBay.
In order to help ensure transparency of our practices, we have
posted information regarding our corporate governance procedures
on our website at http://investor.ebay.com/governance.
Board Effectiveness and Director Performance
Reviews. It is important to eBay that the Board
and its committees are performing effectively and in the best
interest of the company and its stockholders. The Board performs
an annual self-assessment, led by the lead independent director,
to evaluate its effectiveness in fulfilling its obligations. As
part of this annual self-assessment, directors are asked to
provide feedback on the performance of other directors. The lead
independent director then follows up on this feedback and takes
such further action with directors receiving comments and other
directors as he deems appropriate.
Succession Planning. The Board recognizes the
importance of effective executive leadership to eBay’s
success, and meets to discuss executive succession planning at
least annually. As part of this process, the Board reviews the
capabilities of the company’s senior leadership as set out
in written succession planning documents and identifies and
discusses potential successors for members of the company’s
executive staff, including the Chief Executive Officer.
Auditor Independence. eBay has taken a number
of steps to ensure continued independence of our outside
auditors. Our independent auditors report directly to the Audit
Committee, and we limit the use of our auditors for non-audit
services. The fees for services provided by our auditors in 2005
and 2004 and our policy on pre-approval of non-audit services
are described under Proposal 3 below.
Table of Contents
Corporate Hotline. eBay has established a
corporate hotline to allow any employee to confidentially and
anonymously lodge a complaint about any accounting, internal
control, auditing, or other matter of concern.
This excerpt taken from the EBAY DEF 14A filed May 16, 2005. Our Corporate
Governance Practices
We believe open, effective, and accountable corporate governance
practices are key to our relationship with our stockholders. To
help our stockholders understand our commitment to this
relationship and our governance practices, several of our key
governance initiatives are summarized below.
Governance Guidelines. The Board has adopted a set of
governance guidelines to set a framework within which the Board
will conduct its business. The governance guidelines can be
found on our website at http://investor.ebay.com/governance
and are summarized below.
Committee Responsibilities. Board committees help the
Board run effectively and efficiently, but do not replace the
oversight of the Board as a whole. There are currently three
principal committees: the Audit Committee, the Compensation
Committee, and the Corporate Governance and Nominating
Committee. Each committee meets regularly and has a written
charter approved by the Board. In addition, at each regularly
scheduled Board meeting, a member of each committee reports on
any significant matters addressed by the committee. Each
committee performs an annual self-assessment to evaluate its
effectiveness in fulfilling its obligations.
Independence. Nasdaq rules require listed companies to
have a board of directors with at least a majority of
independent directors. Our Board has determined that eight of
our ten directors are independent under the listing standards of
the Nasdaq Stock Market. The Board limits membership on the
Audit Committee, the Compensation Committee, and the Corporate
Governance and Nominating Committee to independent non-employee
directors. In addition, the Board has a designated lead
independent director who chairs and can call formal closed
sessions of outside directors, leads Board meetings in the
absence of the Chairman, and leads the annual board
self-assessment. Mr. Tierney is currently the lead
independent director, and will serve in that capacity until the
Board meeting following our 2006 annual meeting of stockholders.
Stockholder Communication. Stockholders may communicate
with the Board of Directors or individual directors care of the
Corporate Secretary, eBay Inc., 2145 Hamilton Avenue,
San Jose, California 95125. The Corporate Governance and
Nominating Committee has delegated responsibility for initial
review of stockholder communications to our Corporate Secretary.
In accordance with the committee’s instructions, our
Corporate Secretary will summarize all correspondence and make
it available to each member of the Board. In addition, the
Corporate Secretary will forward copies of all stockholder
correspondence to each member of the Corporate Governance and
Nominating Committee, except for communications that are
(a) advertisements or promotional communications,
(b) solely related to complaints by users with respect to
ordinary course of business customer service and satisfaction
issues, or (c) clearly unrelated to our business, industry,
management, or Board or committee matters.
Attendance at Annual Meetings. Absent exigent
circumstances, all directors are expected to attend the
company’s annual meeting of stockholders. All nine of the
directors who were then on the Board attended our 2004 annual
meeting of stockholders.
Formal Closed Sessions. At the conclusion of each
regularly scheduled Board meeting, the outside directors have
the opportunity to meet without our management or the other
directors. The lead independent director leads the discussions.
Board Compensation. Board compensation is determined by
the Compensation Committee. Prior to 2003, Board compensation
was 100% equity based. After a review, in December 2002, Board
compensation was substantially revised by the Board, with equity
compensation reduced and cash compensation added. Board
compensation has subsequently been reviewed annually by the
Compensation Committee, which has not changed cash compensation
and has effectively reduced equity compensation by holding the
number of options granted annually to the same absolute number
notwithstanding two subsequent stock splits. Current Board
compensation is described under the heading “Executive
Compensation — Compensation of Directors” below.
6
Table of Contents
Stock Ownership Guidelines. In September 2004, our Board
adopted stock ownership guidelines to better align the interests
of our directors and executives with the interests of
stockholders and further promote our commitment to sound
corporate governance. Under the guidelines, our executive
officers are required to achieve ownership of eBay common stock
valued at three times their annual base salary (five times in
the case of our Chief Executive Officer). Until an executive
achieves the required level of ownership, he or she is required
to retain 25% of the net shares received as the result of the
exercise of eBay stock options. Directors are required to
achieve ownership of eBay common stock valued at three times the
amount of the annual retainer paid to directors within three
years of joining the Board, or in the case of directors serving
at the time the guidelines were adopted, within three years of
the date of adoption of the guidelines. A more detailed summary
of our stock ownership guidelines can be found on our website at
http://investor.ebay.com/governance. The ownership levels
of our executives and directors as of April 1, 2005 are set
forth in the section entitled “Security Ownership of
Certain Beneficial Owners and Management” below.
Outside Advisors. The Board and each of its committees
may retain outside advisors and consultants of their choosing at
the company’s expense. The Board need not obtain
management’s consent to retain outside advisors.
Conflicts of Interest. eBay expects its directors,
executives and employees to conduct themselves with the highest
degree of integrity, ethics and honesty. eBay’s credibility
and reputation depend upon the good judgment, ethical standards
and personal integrity of each director, executive, and
employee. In order to better protect eBay and its stockholders,
eBay regularly reviews its Code of Conduct to ensure that it
provides clear guidance to its employees and directors.
Transparency. eBay believes it is important that
stockholders understand the governance practices of eBay. In
order to help ensure transparency of our practices we have
posted information regarding our corporate governance procedures
on our website at http://investor.ebay.com/governance.
Board Effectiveness. It is important to eBay that the
Board and its committees are performing effectively and in the
best interest of the company and its stockholders. The Board
performs an annual self-assessment, led by the lead independent
director, to evaluate its effectiveness in fulfilling its
obligations.
Succession Planning. The Board recognizes the importance
of effective executive leadership to eBay’s success, and
meets to discuss executive succession planning at least annually.
Auditor Independence. eBay has taken a number of steps to
ensure continued independence of our outside auditors. Our
independent auditors report directly to the Audit Committee and
we limit the use of our audit firm for non-audit services. The
fees for services provided by our auditors in 2004 and 2003 and
our policy on pre-approval of non-audit services are described
under Proposal 4 below.
Corporate Hotline. eBay has established a corporate
hotline to allow any employee to confidentially and anonymously
lodge a complaint about any accounting, internal control,
auditing or other matter of concern.
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