2018 Guide to Effective Proxies

2.15 Director recruitment & succession | 211 6 TH EDITION | GUIDE TO EFFECTIVE PROXIES ENTERGY CORPORATION HOST HOTELS & RESORTS, INC. MASTERCARD, INC. NASDAQ, INC. BOARDOFDIRECTORS KarenA. Puckett Houston,Texas Age57 DirectorSince2015 EntergyBoardCommittees ‰ Audit ‰ Personnel ProfessionalExperience ‰ PresidentandChiefExecutiveOfficer,HarteHanks, Inc.(marketingservicescompany)since2015 ‰ FormerPresident-GlobalMarketsofCenturyLink, Inc.(atelecommunicationscompany)–2014-2015 ‰ FormerExecutiveVicePresidentandChief OperatingOfficerofCenturyLink,Inc.–2009-2014 ‰ FormerPresidentandChiefOperatingOfficerof CenturyTel,Inc.–2000-2009 ‰ DirectorofHarteHanks,Inc. SkillsandAttributes Ms. Puckett brings to the Board her extensive management, operations and business experience acquired through her senior leadership positions in a rapidly changing and highly regulated industry and her deep experience with technology-driven innovation. Ms. Puckett’s ties to the State of Louisiana also enable her to offer insight into the issues and concerns of our serviceterritories. The Board of Directors unanimously recommends that the shareholders vote FOR the election of eachnominee. Identifying Director Candidates Our Corporate Governance Committee is charged with reviewing the composition of the Board and refreshing the Board as appropriate through the recommendations it makes to the Board. This is an ongoing process through which the Board has added 6 new directors since 2013. These directors have brought to the Board, among other things, deep finance and accounting experience, nuclear expertise and senior leadership experience in companies or industries undergoing transformational change. The Corporate Governance Committee has not established any minimum qualifications that must be met by director candidates or identified any set of specific qualities or skills that it believes our directors must possess. The Corporate Governance Committee’s policy regarding consideration of potential director nominees acknowledges that choosing a Board member involves a number of objective and subjective assessments, many of which are difficult to quantify or categorize. However, the Corporate Governance Committee followsthese core principles: • Seeks to nominate candidates with superior credentials, sound business judgment and the highestethicalcharacter. • Takes into account the candidate’s relevant experience with businesses or other organizations of comparable size to the Company and seeks to identify candidates whoseexperiencewilladdto the collectiveexperienceof the Board. • Believes the Board should reflect a diversity of backgrounds and experiences in various areas, including age, gender, race, geography and specialized experience, and candidates are assessed to determine the extent to which they would contribute to that diversity. 2018ProxyStatement Š 17 Total of 02 pages in section CORPORATEGOVERNANCEANDBOARDMATTERS ProcessforSelectingDirectors TheNominatingandCorporateGovernance Committeescreenscandidatesandrecommends candidatesfornominationbythefullBoard.The Company’sBylawsprovidethatthesizeoftheBoard mayrangefromthreetothirteen.TheBoardcurrently believesthatanappropriatesizeisninetoeleven members,allowing,however,forchanging circumstancesthatmaywarrantahigherorlower number.TheCommitteeconsidersdirectorcandidates suggestedbymembersoftheCommittee,other directors,stockholders(asdiscussedbelow)and management,andhasengagedtheservicesofthird partyfirmstoassistinidentifyingandevaluating directorcandidates.TheCommitteeretainedFerguson PartnersLtd.inthefallof2015forthispurpose. Wehadthreenewdirectorsin2017,twoofwhom areindependent.Mr. Risoleo,ourCEO,becamea BoardmemberonJanuary1,2017.Ms.MaryHogan PreussewasidentifiedasacandidatebyMr. Risoleo andelectedtotheBoardeffectiveinJune2017onthe recommendationofCommittee.Mr. Steinwas identifiedasacandidatebyFergusonPartnersLtd. andelectedtotheBoardinJuly2017onthe recommendationoftheCommittee. StockholderNominationsandRecommendationof DirectorCandidates TheCommitteeconsidersanywrittensuggestions ofstockholdersfordirectornominees.The recommendationmustincludethenameandaddress ofthecandidate,abriefbiographicaldescriptionanda descriptionoftheperson’squalifications. RecommendationsshouldbemailedtoHostHotels& Resorts,Inc.,6903RockledgeDrive,Suite1500, Bethesda,MD20817,Attn:Secretary. Inaddition,weamendedourBylawsinNovember 2016topermitastockholder(orgroupofupto20 stockholders)whohaveownedatleast3%ofour stockcontinuouslyforatleastthreeyearstosubmit directornomineesforthegreateroftwoindividualsor 20%oftheBoardforinclusioninourproxystatementif thestockholder(s)andnominee(s)meetthe requirementsoftheBylaws. Stockholderswhowouldliketonominatea candidatefordirectorforinclusionintheCompany’s proxystatement, orwhowouldliketonominatea directorcandidatethatisnotintendedtobeincludedin theCompany’sproxystatementmustineachcase complywiththerequirementsdescribedinthisproxy statementandtheCompany’sBylaws.See “StockholderProposalsforourNextAnnualMeeting.” HOW WE BUILD A BOARD THAT IS RIGHT FOR HOST TheBoardcontinuouslyidentifiespotentialdirector candidatesinanticipationofretirements, resignations,ortheneedforadditionalcapabilities. Thegraphicbelowdescribestheongoing NominatingandCorporateGovernanceCommittee processtoidentifyhighlyqualifiedcandidatesfor Boardservice. ConsidercurrentBoard skillsetsandneeds EnsureBoardisstrong incorecompetencies ofstrategicoversight, corporategovernance, stockholderadvocacy andleadershipandhas diversityofexpertise andperspective Considerqualified candidates Lookingforexceptional candidatesthat possessintegrity, independentjudgment, broadbusiness experience,diversity andaskillsettomeet existingorfuture businessneeds Checkconflictsof interestandreferences Allcandidatesare screenedforconflicts ofinterest,andall directorsare independent,except theCEOandChairman Nominatingand CorporateGovernance Committee Toconsidershortlisted candidates;after deliberations, Committee recommends candidatesforelection totheBoard Boarddialogueand decision—Commitment torefreshmentand diversity Addedfourhighly qualifieddirectorsin thepasttwoyears;four ofthelastsixBoard membersaddedare eitherwomenorbring diversitytotheBoard 18 Total of 02 pages in section Notice of 2018 AnnualMeeting of Stockholders and Proxy Statement 26 Additionally, theBoard annually discusses and approves the company’s budget and capital requests,which are linked toNasdaq’s long-term strategic plans and priorities. Through these processes, theBoard brings its collective, independent judgment to bear on themost critical long-term strategic issues facingNasdaq. BOARD REFRESHMENT TheNominating&Governance Committee regularly oversees and plans for director succession and refreshment of theBoard to ensure amix of skills, experience, tenure and diversity that promotes and supports the company’s long-term strategy. In doing so, the Nominating&Governance Committee takes into consideration the corporate strategy and the overall needs, composition and size of theBoard, aswell as the criteria adopted by theBoard regarding director qualifications. Since January2017, three new directors have joined theBoard:MelissaM.Arnoldi,Adena T. Friedman and JohnD.Rainey. The average age of these new directors is47 years old, and all three are senior executives at public companies.All three also arefirst-time directors of a public company. In addition, theBoard has nominated JacobWallenberg,who is the Chairman of the Board of InvestorAB andwho has significant experience as a director of publicly traded companies, for election to theBoard at the2018AnnualMeeting. SUCCESSION PLANNING FOR NASDAQ LEADERSHIP TheBoard is committed to positioningNasdaq for further growth through ongoing talent management, succession planning and the deepening of our leadership bench. In this regard, formally on an annual basis and informally throughout the year in Executive Session, theNominating&Governance Committee, theManagement Compensation Committee, theBoard and thePresident and CEO review the succession planning and leadership development program, including a short-term and long-term succession plan for development, retention and replacement of senior officers. TheBoard has a formal process for reviewing internal succession candidates through regular interaction during Boardmeetings and strategy presentations, individualmeetings between directors and potential internal candidates and internal and external feedback from a variety of sources, includingmeetingwith stockholders. In addition, thePresident and CEO prepares, and the Board reviews, a short-term succession plan that delineates a temporary delegation of authority to certain officers of the company, if all or a portion of the senior officers should unexpectedly become unable to perform their duties. In conjunctionwith the annual report of the succession plan, thePresident and CEO also reports onNasdaq’s program for seniormanagement leadership development. RISK OVERSIGHT TheBoard's role in risk oversight is consistentwith the company’s leadership structure, withmanagement having day-to-day responsibility for assessing andmanaging the company’s risk exposure and theBoard having ultimate responsibility for overseeing risk managementwith a focus on themost significant risks facing the company. TheBoard is assisted inmeeting this responsibility by severalBoard Committees as described below under “Board Committees.” Furthermore, directorsmeet on a regular basis, both TheNominating&Governance Committee regularly oversees and plans for director succession and refreshment of theBoard to ensure amix of skills, experience, tenure and diversity that promotes and supports the company’s long- term strategy. 1 ISS Governance QuickScore Best PossibleScore on a scale of 1 to 10 CorporateGovernance |2018MastercardProxy 10 Proposal 1: Election of Directors THEBOARDOFDIRECTORSUNANIMOUSLYRECOMMENDSTHAT STOCKHOLDERSVOTE “FOR”EACHNOMINEETOSERVEASDIRECTOR ElectionProcess EachmemberofourBoardofDirectors(the“Board”)iselectedannuallybyourClassAstockholdersfora one-yeartermthatexpiresatournextannualmeeting. WhenourBoardmembersareelected,theyalso areautomaticallyappointedasdirectorsofouroperatingsubsidiary,MastercardInternational Incorporated(“MastercardInternational”). Ourdirectorsareelectedbyanaffirmativevoteofthe majorityofthevotescastattheannualmeetingofstockholders,subjecttoourmajorityvotingpolicy. You canfindmoreaboutthisin“AbouttheAnnualMeetingandVoting”onpg85. RefreshingtheBoardandNominatingDirectors OurNominatingandCorporateGovernance Committee(“NCG”)reviewsandselects candidatesfornominationtoourBoardin accordancewithitscharter. Annually,theNCGlooksattheBoard’s compositiontodeterminewhetherdirectors’ backgroundsandexperiencesalignwithour long-termstrategyandmaintainourBoard’s globaldiversity. TheNCGalsotakesinto considerationtheresultsoftheBoardself- evaluation. Basedonitsreview,coupledwith ourageandtenurelimits,theNCGdetermines whetherBoardrefreshmentisneeded. Thenthe NCGsearchesforpotentialcandidates,utilizing avarietyofsourcestohelpidentifynominees whowouldbevaluableassetstoourBoardand toMastercard. TomeettheneedsofourBoard, theNCGseekstoidentifycandidatespossessing thedesiredqualities,skillsandbackground. OncetheNCGhasidentifiedcandidates,the Boardselectsnomineestobevoteduponbythe stockholders. IdentifyingDirectorCandidates TheNCGidentifiespotentialnewcandidatesbyrecommendationsfrom: • Stockholders • Professionalsearchfirms • Boardmembers • Management BoardRefreshmentProcess Boardcomposition,includingdirectorskill sets,isanalyzedannually Candidatelistisdeveloped,includingby reviewingrecommendationsof stockholders,directors,management andsearchfirms Personalqualities,skillsandbackground ofpotentialcandidatesareconsidered Stockholdersvoteonnominees Boardrecommendsnominees NCGmeetswithqualifiedcandidates andmakesrecommendations Fivenewdirectorshavebeen nominatedtoourBoardinthe pastfouryears