Newly appointed Board release
March 10 2003 - 2:01AM
UK Regulatory
RNS Number:4903I
Tyco International Ld
07 March 2003
FOR IMMEDIATE RELEASE
NEWLY ELECTED TYCO BOARD MAKES COMMITTEE ASSIGNMENTS
AND ADOPTS NEW INITIATIVES TO ENHANCE CORPORATE GOVERNANCE
Pembroke, Bermuda - March 7, 2003 - Tyco International Ltd. (NYSE:TYC, BSX: TYC,
LSE: TYI) announced that its new Board of Directors, meeting today for the first
time since its election yesterday at the Annual General Meeting of Shareholders,
voted to take several actions, beyond those that had already been implemented
under the Company's new management, to improve corporate governance at Tyco.
The new measures include:
* The re-election by the independent directors of John A. Krol as Lead
Director. In this role, Mr. Krol facilitates and chairs executive sessions
of the Board, which are held after every Board meeting, sets the agenda for
Board meetings, and coordinates the information flow to the Company.
* New assignments for membership on the Board's committees.
* The adoption of new Board Governance Principles, which document the
responsibilities of the directors in overseeing the management of Tyco's
businesses in the best interests of shareholders.
* The adoption of a new employee Guide to Ethical Conduct, which provides
explicit guidelines on conduct that is expected of everyone at Tyco.
* The adoption of a new Delegation of Authority policy to strengthen control
over cash disbursements at the Company.
* A decision to study in detail the issues related to the Company's
incorporation in Bermuda.
* A decision to adopt new severance guidelines for senior executives at the
next Board meeting.
The Board also determined that, except for Chairman and CEO Edward D. Breen, all
members of the Board are considered "independent members." Institutional
Shareholder Services, Inc., one of the world's leading providers of proxy voting
and corporate governance services, has also determined these nine members of the
Board are independent according to its standards.
"Tyco now has in place an entirely new Board of Directors elected by our
shareholders," commented Edward D. Breen, Chairman and Chief Executive Officer
of the Company. "The clear mission of this Board is to ensure that the new Tyco
adheres to the highest standards of corporate governance and that all of us at
the Company dedicate ourselves to building value for our shareholders."
"The actions taken today are only among the first steps in a continuing drive by
the Board and management to establish clear and uncompromising standards of
conduct in every aspect of our management and financial reporting and to
strengthen specifically the performance of our businesses. The Board as a
whole, together with each of its committees, will work to achieve these goals
through informed, substantive and probing deliberations. We are determined to
distinguish Tyco for its leadership in corporate governance while also unlocking
the potential of the strong portfolio of businesses that make up this Company."
Board Reorganization
In organizing its committees, the Board appointed the following members:
* John A. Krol is to chair the Corporate Governance and Nominating
Committee. Bruce S. Gordon and H. Carl McCall were also appointed as
committee members. The Senior Vice President for Corporate Governance
reports to Mr. Krol as Chairman of this committee.
* Jerome B. York is to chair the Audit Committee. Brendan O'Neill and Sandra
Wijnberg were also appointed as committee members. Additionally, all three
of these directors were determined by the Board to be "financial experts"
according to SEC regulations. The Vice President of Corporate Audit and the
Corporate Ombudsman report to Mr. York as Chairman of this committee.
* Mackey J. McDonald is to chair the Compensation Committee. Adm. Dennis C.
Blair (U.S. Navy, Ret.) and George W. Buckley were also appointed as
committee members.
Other Governance Actions
The governance initiatives announced today are the product of an in-depth
five-month review and analysis that involved benchmarking proposed changes at
Tyco against "best practices" companies. The Board drew upon the expertise of
such recognized governance specialists as Charles Elson, of the University of
Delaware Corporate Governance Center, Michael Useem of the Wharton School of
Business at the University of Pennsylvania, and Jay Lorsch of Harvard Business
School. Tyco also formed a special working group of the Board, with Ira
Millstein of law firm Weil, Gotshal & Manges, serving as an expert outside
advisor, to advance the process.
As one key outcome of this comprehensive review analysis, the Board approved new
Board Governance Principles, a new Delegation of Authority policy to strengthen
control over cash disbursements at the Company, and a new employee Guide to
Ethical Conduct.
* The new Board Governance Principles describe the mission and values of the
Board of Directors of the Company. The document delineates the
responsibilities of the Directors in overseeing the management of Tyco's
businesses in the best interest of shareholders and in a manner that is
consistent with good corporate citizenship. The Board Governance Principles
reflect the Board's belief that good governance requires not only an
effective set of specific practices, but also a company-wide culture of
integrity and accountability that starts with its leadership.
* The Company's Delegation of Authority policy provides precise guidelines
and matrices that draw clear lines of authority and accountability, coupled
with budgetary responsibility, for expending company funds. This policy
encompasses such areas as employee compensation, borrowings and capital
expenditures, acquisitions, travel and entertainment, investments and
charitable contributions.
* The employee Guide to Ethical Conduct provides explicit guidelines on what
is expected of everyone who works at Tyco. It includes the four core values
of the company - integrity, excellence, teamwork and accountability. It
also provides a close look at a variety of on-the-job issues such as ethical
conduct, fraud, financial controls, conflicts of interest, record-keeping,
protection of confidential information, harassment, substance abuse, and
inappropriate gifts. The Guide also clearly explains how employees
worldwide can report a violation of the code of conduct or seek guidance on
particular issues, with complete confidentiality, by calling Tyco's toll
free CONCERNline or by contacting the office of the Tyco Ombudsman. Tyco
recently announced the hiring of Richard Baran as its first Corporate
Ombudsman.
The governance practices announced today implement and in some instances exceed
the requirements of the Sarbanes-Oxley Act, New York Stock Exchange listing
requirements and the Company's own high standards of good corporate governance.
ABOUT TYCO INTERNATIONAL LTD.
Tyco International Ltd. is a diversified manufacturing and service company. Tyco
is the world's largest manufacturer and servicer of electrical and electronic
components; the world's largest designer, manufacturer, installer and servicer
of undersea telecommunications systems; the world's largest manufacturer,
installer and provider of fire protection systems and electronic security
services and the world's largest manufacturer of specialty valves. Tyco also
holds strong leadership positions in medical device products, and plastics and
adhesives. Tyco operates in more than 100 countries and had fiscal 2002 revenues
from continuing operations of approximately $36 billion.
FORWARD LOOKING STATEMENTS
This release may contain certain "forward-looking statements" within the meaning
of the United States Private Securities Litigation Reform Act of 1995. These
statements are based on management's current expectations and are subject to
risks, uncertainty and changes in circumstances, which may cause actual results,
performance or achievements to differ materially from anticipated results,
performance or achievements. All statements contained herein that are not
clearly historical in nature are forward looking and the words "anticipate," "
believe," "expect," "estimate," "plan," and similar expressions are generally
intended to identify forward-looking statements. The forward-looking statements
in this release include statements addressing the following subjects: future
financial condition and operating results. Economic, business, competitive and/
or regulatory factors affecting Tyco's businesses are examples of factors, among
others, that could cause actual results to differ materially from those
described in the forward-looking statements.
More detailed information about these and other factors is set forth in Tyco's
Annual Report on Form 10-K for the fiscal year ended September 30, 2002 and
Tyco's Quarterly Report on Form 10-Q for the fiscal quarter ended December 31,
2002. Tyco is under no obligation to (and expressly disclaims any such
obligation to) update or alter its forward-looking statements whether as a
result of new information, future events or otherwise.
Contact:
Gary Holmes (Media)
212-424-1314
Kathy Manning (Investors)
603-334-3900
This information is provided by RNS
The company news service from the London Stock Exchange
END
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