AMN 2018 Proxy Statement

CORPORATE GOVERNANCE the sales and corporate leadership. The front line sales incentive plans typically provide incentives based on monthly or quarterly financial or individual and team operational metrics and include monthly or quarterly payouts. Roughly two-thirds of our sales team members participate in one of our approximately 50 sales incentive plan structures. The sales and corporate leadership plans use annual financial targets based on consolidated and/ or division metrics as well as individual leadership and performance considerations with annual payouts. We have internal controls over financial reporting and the measurement and calculation of compensation goals and other financial, operational and compliance policies and practices that are designed to keep these compensation programs from being susceptible to manipulation by any employee, including our named executive officers. The Compensation Committee considers the risks associated with the compensation plans in light of several factors, including (1) the amount of incentive compensation paid to a particular group as a percentage of total incentive cash paid and as a percentage of division and/or consolidated revenue, gross profit and adjusted EBITDA (“ AEBITDA ”), (2) the number of plan participants in any particular plan as a percentage of total incentive plan participants, and (3) the amount of target incentive compensation per individual plan participant ranges from 10% to 110% of total compensation (and can range from approximately 56% to 76% of the named executive officers’ total compensation). The Compensation Committee believes the use of a long-term incentive award program with targets that span a three-year performance period balances risk and reward by discouraging excessive risk that could threaten our long-term value, but at the same time encourages innovation to build our value in the short- and long-term. The Compensation Committee also reviews our program for design features that have been identified by experts as having the potential to encourage excessive risk-taking, such as: (A) too much focus on equity, (B) compensation mix overly weighted toward short-term results, (C) highly leveraged payout curves and steep payout cliffs at specific performance levels that could encourage short-term actions to meet payout thresholds, and (D) unreasonable goals or thresholds. After its consideration of the foregoing factors, the Compensation Committee has determined that our compensation programs and policies do not create risks that are reasonably likely to have a material adverse effect on us. CORPORATE GOVERNANCE COMMITTEE OVERSIGHT The Corporate Governance Committee considers the risks associated with our corporate governance practices, leadership succession process and quality programs. The Corporate Governance Committee reviews the company’s practices and approach with respect to corporate governance to ensure that its corporate governance structure provides a foundation for achieving long-term shareholder value. This responsibility goes hand in hand with its oversight of the Company’s leadership succession process to not expose the Company to leadership gaps and the consequences flowing therefrom. The Corporate Governance Committee also reviews and discusses with our management relevant quality metrics, performance improvement, compliance with certification standards and related laws and regulations as well as our enterprise risk management processes relating to the quality of our services. The Corporate Governance Committee believes the Company’s sound corporate governance practices, comprehensive leadership success program and extensive quality programs are designed to shield the Company from risk that is reasonably likely to have a material adverse effect on us. Director Independence The Board has adopted categorical standards for director independence, which we set forth in the Guidelines and make available on the our website. Under these standards, a director will not be considered independent if: (1) the director does not qualify as independent under Rule 303A.02(b) of the NYSE Listed Company Manual, (2) the director or an immediate family member is a partner of, or of counsel to, a law firm that performs substantial legal services for us on a regular basis, or (3) the director or an immediate family member is a partner, officer or employee of an investment bank or consulting firm that performs substantial services for us on a regular basis for which it receives compensation. The Board does not consider the following relationships to be material relationships that would impair a director’s independence: (1) the director or an immediate family member is an executive officer of another company that does business with us and the annual sales to, or 20 AMN HEALTHCARE SERVICES, INC. ⎪ 2018 Proxy Statement