Corporate SecretaryMAGAZINE

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Celebrating the first Corporate Secretary AwardsWelcome to the inaugural Corporate Secretary Magazine Awards.We are very proud and excited to be recognizing the best of the best in the world of corporate governance.

When the idea for these awards was first floated a couple years ago, my colleagues raised a lot of questions, the most challenging of which was ‘Exactly what is good governance and, even if we figure that out, how can wemeasure it?’ It is a very good point.The answer, of course, is that there is nosingle ‘right way.’ Every company faces its own unique challenges and culture.

This was made evident early in the nomination process when entries beganflooding into our office. Over 150 companies submitted information for consideration, and while many of the entries contained common themes,every company took a slightly different approach to answering the mostpressing governance questions.

While many of the winners and short-listed names are from mega-cap companies with massive budgets and at least a few have a governance andcompliance team in excess of 30 people, smaller companies are also scatteredthroughout the list of nominees. It is proof that size and sector are no impediment to innovative thinking and best practice.

As the judges quickly realized, picking a shortlist, not to mention an eventualwinner, would be an extremely difficult task.They stuck to their work, however,and now,after many months of planning,we are please to announce the winners.

Reading all the nominations, and evaluating the supporting materials hasgreatly improved and challenged my concept of governance and how it canbe achieved. But this is not a one-way process. A number of nominees havecontacted us to share how the Awards have helped them understand theirown processes and identify areas that may need to be addressed.

I would like to thank all those companies and individuals that submitted entriesand for those who take home awards, my sincere congratulations.

Brendan SheehanEditor, Corporate Secretary magazine

Kenneth Bertsch Executive director & head of corporate governance, Morgan Stanley Investment Management

Bertsch joined Morgan Stanley Investment Management in December 2006,where he is responsible for corporate governance policy and proxy votingpractices in the Global Equity Group.

Previously he led the corporate governance analysis team for fundamental corporate and financial institution ratings at Moody’s Investors Service. Prior to this he was director, corporate governance, for TIAA-CREF where he coordinated a program that reviewed governance structures and practices of US-based portfolio companies.

Roel Campos Partner in charge of Cooley Godward Kronish’s Washington, DC office.He is a member of the litigation department and joined the firm in 2007.

Prior to joining Cooley, Campos was a commissioner of the SEC. He was sworn in as a commissioner in August 2002 and served for a second term before leaving in mid-2007. He served for four years as the Commission’s liaison to the international regulatory community. During his time at the SEC, he became one of the best known regulators in the world. As vice chairof the technical committee of the International Organization of SecuritiesCommissioners, he developed productive relationships with securities regulators in Europe, Asia, Australia, and Latin America. Campos also facilitated the development of international auditing and accounting standards through his work as chair of the monitoring group.

Prior to being nominated to the Commission, Campos was one of two principal owner-executives of El Dorado Communications, a radio broadcasting company.

John Castellani President of the Business Roundtable, an association of chief executive officers of companies with combined annual revenues of $4.5 trillion. Sincejoining the Business Roundtable, Castellani has led efforts on key public policyissues ranging from trade expansion to civil justice reform to fiscal policy.

Significant areas of leadership for Castellani and the Roundtable include contributions to the passage of the Sarbanes-Oxley corporate governance reforms; and development of the Business Roundtable Institute for CorporateEthics. Prior to becoming president of Business Roundtable, Castellani was executive vice president of Tenneco.

The judges

Bertsch

Campos

Castellani

The judges

Charles Elson Director of the John Weinberg Center for Corporate Governance at the University of Delaware. He is also of counsel to Holland & Knight. He formerly served as a professor of law at Stetson University College of Law in St Petersburg, Florida from 1990 until 2001.

Additionally, Elson served as an adviser and consultant to Towers Perrin; a director of Circon Corporation,Sunbeam, Nuevo Energy, and AlderwoodsGroup, and is presently a member of the boards of AutoZone and HealthSouth.

Terry Gallagher Recently retired as CEO of Corporate Governance Associates. He also retiredas vice president - corporate governance of Pfizer. Gallagher joined Pfizer in1966 as an attorney. In 1975, he was named assistant general counsel and assistant secretary, moving to secretary in 1983 and before becoming vicepresident, corporate governance in 1992.

Gallagher was co-chair of the Council of Institutional Investors and chair ofthe co-ordinating committee of the corporate governance task force of theBusiness Roundtable. He has served both as past president of the New Yorkchapter of the American Society of Corporate Secretaries and a member ofthe national board.

Norman Veasey Former Chief Justice of Delaware. Currently senior partner at Weil, Gotshal & Manges

Norman Veasey serves as a strategic adviser to the firm’s roster of globalclients on issues related to mergers and acquisitions, restructuring and litiga-tion. Additionally, he advises on corporate governance issues involving the responsibilities of corporate directors in complex financial transactions and crisis management.

He is the former chief justice of Delaware, having stepped down from theDelaware Supreme Court in May 2004, after serving a 12-year term as the top judicial officer and administrator of that state’s judicial branch.

John Wilcox Chairman of Sodali, a firm providing consulting and transactional services to listed companies in Europe, Asia and developing markets. He is also an independent consultant on corporate governance to TIAA-CREF, where heserved as senior vice president and head of corporate governance from 2005 to 2008. Prior to joining TIAA-CREF, he was chairman of Georgeson. During hiscareer he has specialized in corporate governance, investor relations, proxy voting, corporate control transactions, capital markets regulation and directoreducation.

Elson

Gallagher

Veasey

Wilcox

Sponsored by

Joint winners

Doug Chia - Johnson & Johnson

Laura Lonsdale - TycoThe joint-winners of this award have very different experiences yet theyshare some common ground.Both have excelled in their relatively shortperiods on the job and have risen through their organizations.

Laura Lonsdale inherited some well-publicized challenges when shestarted at Tyco and in the past five years has worked in internal audit,managed the company’s corporate governance and is currently ombudsman.Rebuilding after the Kozlowski scandal and the separationof the conglomerate into three independent companies would havebeen a serious challenge for an experienced professional, let alonesomeone with only a few years in the governance world.

Douglas Chia has quickly become one of the most recognizable namesin corporate governance.After leaving private law practice in 2004 hespent some time with Tyco International,where he worked to advance governance,SOX compliance and public disclosure.His worked attracted the attention of Johnson & Johnson where he moved in 2005.

He is membership chairman for the Society of Corporate Secretaries andGovernance Professionals and presents extensively on governance,SECand corporate legal matters at conferences across the country.

Honorable mentions

% Alan Srulowitz (CA)

Transformed internal control function taking greater ownershipand maximizing cost efficiencies.

% Larry Parsons (Freescale)

Created new compliance and ethics program after spin-off from Motorola and subsequent management buyout

% Julia Farr Connolly (MHI Hospitality)

Sole compliance practitioner tasked with creating and implementing MHI’s post-IPO governance program

Sponsored by

Winner

UnitedHealth

The well thought-out and specifically targeted nature of this program makes it stand out from the pack. UnitedHealth tailors its program to each board member, all of whom have different experience and responsibilities and therefore may require one-on-one training on a particular area. Rather than sending theboard to a pre-organized director education course at a business or law school, the course is brought in-house and targeted, thusmaking it more effective and time efficient.

The availability and use of the online education technology whichhelps directors learn during non-service hours is also impressive.

Honorable mentions

% Sprint Nextel

Extensive one-on-one board member induction and major site visits for all new board members

% Time Warner

Extensive pre-employment interaction to introduce directors to board culture

% Manitowoc

Solid continuing professional education and effective annual self-assessment process

% El Paso Corporation

Third-party education program balanced with continual, in-house training on emerging strategic and governance issues

Sponsored by

Winner

Intel

Intel utilizes up-to-the-minute technology through its governanceand compliance structures that allows all employees access to theinformation they need to be compliant.

It has a particularly well-designed interactive web portal for corporate directors, executives and other senior officers that contains extensive background research applicable to variousboard committees, peer assessments, general company andbroader business information which helps ensure directors are well informed and engaged.

Beyond board-level technology the company also has an enterprise-wide compliance and ethics training tool and internalcommunication mechanism which helps push the corporate ethosacross the entire organization.

Honorable mentions

% Citigroup

Unique legal vehicle managementand global database rollout

% Coca-Cola Company

A leader in utilizing technology to increase speed of communication while minimizing overall environmental impact

% Exelon

Constantly pushes vendors to exceed accepted practice and advance new, more effectivetechnical developments

Sponsored by

Joint winners

Joan Conley & Edward Knight - NASDAQ OMX

Eric Brown - TransoceanThe judges were so impressed with both the Nasdaq OMX mergerand the Transocean deal that they were unable to split the two andso the award has been awarded jointly to both companies.

Transocean - The most impressive part of this transaction, accordingto the judging panel, is the post-merger integration. It is rare thatsuch a complicated transaction goes so smoothly and two culturesare merged without major disruption.

Nasdaq OMX - Not only was the deal professionally and efficientlyconducted but the level of communication with shareholders,regulators and the media was exceptional. Shareholders often feeluneasy during a merger of this sort but the team at Nasdaq wasparticularly good at keeping everyone well informed throughoutthe process

Honorable mentions

% Kimberly Hudolin

(General Motors)

The management of intellectual property and corporate entity issues during the sale of Allison Transmission was a standout

% Charles Sprague

(FiServ)

High volume and complexity of transactions including acquisitions, divestitures and an IPO kept the team constantly busy

% Thomas Larkins

(Honeywell)

Honeywell’s M&A process is focused on getting smart deals done quickly

Sponsored by

Winner

GE

It is interesting the way GE’s executive compensation disclosure engages with strategy and drives new disclosure formats. They responded well to previous, well-publicized compensation issuesand did not shy away from addressing and disclosing the problems.

The corporate objectives and how they relate to compensationgoals are very well articulated in clear and concise language.Peer groups are well defined and assessed.

Total compensation is clearly and concisely disclosed. Non-cash elements are well defined. Tables are easy to read and complicatedfootnotes are kept to a minimum.

Honorable mentions

% Schering-Plough

Intelligent historical context and broad stakeholder input help tell the company’s compensation story

% MBIA

Early ‘say on pay’ adopter and open to candid conversation with investors on compensation structure

% Allstate

Organization, presentation and formatting help to enhance readability and highlight key information

% MDU Resources

MDU’s CD&A delineates compensation objectives and ‘explains the why’ in simple,plain English

Sponsored by

Winner

Gap

This disclosure includes a particularly impressive country-by-country breakdown of various issues, demonstrating an awarenessof shifting environmental, social and cultural challenges across various regions.

The company does an excellent job of taking its CSR disclosure beyond the ordinary by intelligently incorporating business impacts of its actions and abatement activities with a range of social issues. It affirmatively and thoroughly integrates businessstrategy and societal concerns and demonstrates candor wherethere are shortfalls. The CSR disclosure is well written and is easily understood by a general audience, and is not targeted specificallyto investors.

Honorable mentions

% Motorola

Thorough integration of business strategy and societal concerns

% American Electric Power

Robust and candid discussion of critical issues the could impact thedecisions of investors

% Johnson & Johnson

Employee, analyst, government,investor and public input help inform disclosures

% Ford

Clear, concise and creative,including new assessments on mobility and human rights

Sponsored by

Winner

RiskMetrics

The clarity of the RiskMetrics proxy is outstanding. It effectivelywalks the line between being a regulatory compliance documentand a communication tool. The judges enjoyed the conversationalQ&A style of presentation.

The judges were particularly impressed by the disclosure of compensation performance objectives and how they influence final compensation of executives. Of particular note is the three-part compensation philosophy and objectives table whichclearly defines the type of pay instrument, describes how it impacts compensation, and to what level the objective was achieved.

The corporate governance objectives are not only identified but thecompany does a good job of describing exactly how it defines eachobjective and where it fits into the management process. The entireproxy is extremely well written in simple and effective language.It flows well, is easily understood and achieves is purpose perfectly.

Honorable mentions

% JetBlue Airways

Comprehensive explanation of proposed amendments and thorough discussion of legal andregulatory challenges.

% GE

The GE board has adopted corporate governance principlesto ensure it is independent and informed, and strives to ensure all stakeholders are equally well informed.

% Intel

Use of plain English principles,complete compensation disclosure and innovative designenhance communication aspects

% El Paso Corporation

Innovative formats, plain language and a constant drive to improve result in a well balanced and different disclosure document

Sponsored by

Winner

Pfizer

A long-time leader in corporate governance, Pfizer continues tolead the way in finding new and effective avenues to communicatewith its shareholders. One of the standout events of the past yearsaw Pfizer invite its major shareholders to an in-person meeting attended by executive management and the board. Shareholderswere able to ask questions and raise concerns about governance,which were then addressed by the relevant member of management or the board.

The company does not just ensure investors that the board is activeand engaged in oversight and that management are leaders in thegovernance space, they provide solid, tangible proof.

Honorable mentions

% BorgWarner

Strong plain English approach andcontinual international outreach

% Phillips-Van Heusen

Outperformed 99.5% of companies in S&P 400 for annual meeting and proxy performance

% Tenet Healthcare

Annual investor day and webcast increases transparency and shareholder access

Sponsored by

Winner

Dannette Smith(UnitedHealth)

UnitedHealth has had its share of problems in recent times butDanette Smith’s work in handling them was outstanding. She wasintegral in UnitedHealth’s transition to being a market leader withsolid governance and communication structures. Her efforts contributed significantly to the company’s post-crisis turnaround.

The design and implementation of the new governance programcaught the judges eye as did her courage in putting together acompletely new risk management process that is fast becoming an example for others to follow.

Honorable mentions

% Mark Stachiw (MetroPCS Communications)

Led the company through IPO and listing on NYSE – the second largest of 2007.

% Lydia Beebe (Chevron)

Amended corporate bylaws to reflect latest governance thinking.She was 2007/2008 chair of the Society of Corporate Secretaries and Governance Professionals

% Carol Ward (Kraft Foods)

Created governance program following spin-off from Kraft.Defended against aggressive proxy campaign by Norman Peltz

% Larry Appel (Winn-Dixie)

Restructured board processes following Chapter 11 emergence and developed company-wide ERM system

Sponsored by

Winner

Colgate-PalmoliveColgate-Palmolive could be described as the quiet achiever of US corporate governance. It is not always trying to be seen as being ‘out in front’ of the market and does not seek headlines.Its approach is to do everything well, from compliance and ethics training, director and officer engagement, shareholder communications and management structure. It is difficult to find fault with any part of its program.

Colgate-Palmolive is the consummate all-rounder and has all the bases covered.

Honorable mentions

% Baker Hughes

Formalized best-in-class ethics program following FPCA settlement and deferred prosecution agreement

% Chevron

Strong response to changing regulatory environment, updated bylaws and intelligent response to shareholder proposals

% Wyndham Worldwide

Creation of new governance and compliance program following spin-off from Cendant

% Sunoco

Enhanced health, environment and safety standards combined with increased independence of board and advisors

Sponsored by

Winner

Ira MillsteinIra Millstein is one of the top names in governance. For over twentyyears he has been a leader in creating new ways of looking at governance and taking the message to corporations, lawyers,regulators and shareholders. Importantly, his message is not justabout promoting governance ideas or being controversial or contrarian, but is more about identifying effective practices andthen driving consensus.

He was one of the first to really start a formal governance educationprogram for corporate directors and today the Millstein Center atYale University is considered one of the leading corporate governance programs.

Honorable mentions

% Warren Batts

University of Chicago Graduate School of Business. Former director Allstate; Cooper Industries; Sears Roebuck, Sprint

% Dennis Beresford

University of Georgia. Former chairman of FASB

% Peter Clapham

President and CEOGovernance for Owners USA

% Robert Monks

Co-founder of ISS and The Corporate Library

% Steve NormanCorporate secretary and chief governance officer, American Express

% Larry Sonsini

Chairman, Wilson SonsiniGoodrich & Rosati

Winner

MonsantoMonsanto takes a unique and effective approach to combining ‘traditional’ corporate governance theories with modern approaches to risk management.

Rather than being a drain on business operations, Monsanto’s governance processes help to guide and inform corporate strategy.Striking the right balance between compliance and profitability is a difficult task which it has achieved well.

A great governance program, however, needs to be effectively communicated and the judges found the company’s outreach to major investors exceptional.

Honorable mentions

% Pfizer

Despite some controversy, it was out front and open with disclosure

% Microsoft

Impressive coordination of global compliance and legal regimes

% Exelon

Extremely proactive and constantly engaged with emerging governance concepts

% The Hartford

Highly effective ethics environment achieved through constant online training

‘Thanks for basing these awards on objectivecriteria. There should be some best practiceswe can all learn from. While I understand thereasons for the ‘no one size fits all’philosophy

that many espouse, we believe there has to bea ‘best’to measure yourself against so that you

can use the gaps to improve performance.’

‘Our team got very engaged in the process andstarted thinking about what we do in new

ways. The categories are not only substantivebut very challenging. Just going through theprocess of drafting the applications gave our

people the opportunity to consider and appreciate the importance of what they do.’

A Cross Border event