Lithia places a high degree of importance on our corporate governance practices. We recognize that our employees and all our stakeholders look to our Board of Directors and management to set the tone and to promote a culture of integrity and transparency.
Our mission and core values, developed by our Board of Directors in conjunction with top-level management, are the foundation we constantly refer back to in order to guide our decision-making. Annual board training sessions are held to ensure the board, our strategic goals and our corporate values are aligned. As new directors join our board, each is ushered through a formal onboarding process including education on our history, values and strategic mission.
The Chair of our Board of Directors is Sidney DeBoer. Formerly the CEO (1968-2011) and the Executive responsible for taking Lithia public in 1996, Sid no longer serves in a management role nor is he involved in day-to-day operations of the Company. The current CEO, Bryan DeBoer, is a Member of the Board and reports directly to our Lithia Board of Directors.
The relatively small size [seven] of our Board allows them to make decisions regarding economic, environmental and social topics rather than going through specific committees. The three Committees of our Board are:
1) Audit Committee
2) Nominating and Governance Committee
3) Compensation Committee
Each has a Charter that guides their mission, authority and responsibilities in addition to how and when meetings will be held. Shareholders of Lithia Motors, Inc. directly elect members to the Board of Directors at the Annual Shareholder Meeting, which occurs every April. Both the Board and shareholders have mechanisms for proposing nominees to be listed on the annual ballot.
A Commitment to Improve Constantly
In April 2019, two major corporate governance changes were instituted. Upon Shareholder approval, the Board of Directors amended the Company's bylaws to adopt a majority vote standard for the election of directors in addition to providing “proxy access.”
The majority vote standard requires each director to receive a majority of the votes cast with respect to that director. Under the previous plurality vote standard candidates receiving the most votes would win without regard to whether those votes constituted a majority of the shares cast. “Proxy access” is a shorthand term for a process that provides eligible shareholders the ability to include their director nominees of choice in our proxy materials for our annual shareholder meetings. Both of these developments in April demonstrate our desire to continually improve in the corporate governance space.
To find out more about our Board, individual Directors, committee membership, and links to charters and other governance documents please visit www.lithiainvestorrelations.com.