This excerpt taken from the IBM DEF 14A filed Mar 10, 2008.
Under the Companys written related person transactions policy, information about transactions involving related persons is assessed by the independent directors on IBMs Board. Related persons include IBM directors and executive officers, as well as immediate family members of directors and officers, and beneficial owners of more than five percent of the Companys common stock. If the determination is made that a related person has a material interest in any Company transaction, then the Companys independent directors would review, approve or ratify it, and the transaction would be required to be disclosed in accordance with the SEC rules. If the related person at issue is a director of IBM, or a family member of a director, then that director would not participate in those discussions. In general, the Company is of the view that the following transactions with related persons are not significant to investors because they take place under the Companys standard policies and procedures: the sale or purchase of products or services in the ordinary course of business and on an arms length basis; the employment by the Company where the compensation and other terms of employment are determined on a basis consistent with the Companys human resources policies; and any grants or contributions made by the Company under one of its grant programs and in accordance with the Companys corporate contributions guidelines.
From time to time, the Company may have employees who are related to our executive officers or directors. As noted under the discussion above on General InformationBoard of Directors, Mr. Eskews son is employed by the Company. In addition, each of Messrs. M.E. Daniels (Senior Vice President, Global Technology Services), J.B. Harreld (Senior Vice President, Marketing and Strategy), M. Loughridge (Senior Vice President and Chief Financial Officer), and W.M. Zeitler (Senior Vice President and Group Executive, Systems and Technology Group) has an adult child who is employed by the Company in a non-executive position, and each of Messrs. N.M. Donofrio (Executive Vice President, Innovation and Technology) and T.S. Shaughnessy (Vice President and Controller) has a sibling who is employed by the Company in a non-executive position. Further, the wife of Mr. Shaughnessy, a brother-in-law of Mr. Loughridge and a sibling of Ms. L.S. Sanford (Senior Vice President, Enterprise On Demand Transformation) are executives of the Company.