THG 2019 Proxy Statement

• THE HANOVER INSURANCE GROUP 2019 PROXY STATEMENT 12 the quality and candor of PwC’s communications with the Audit Committee and management; and the appropriateness of PwC’s fees relative to the scope and efficiency of the audit and non-audit services provided. The committee also has oversight responsibility for the Company’s General Auditor and must approve matters related to the General Auditor’s employment and compensation. The Audit Committee generally meets in executive session separately with representatives of PwC, the Chief Financial Officer and the General Auditor, and by themselves, following regularly scheduled, in- person committee meetings. The Audit Committee also meets from time to time in executive sessions with the Company’s Chief Actuary, Chief Risk Officer and General Counsel. The Audit Committee reviews and discusses the Company’s financial statements and earnings press releases with management and PwC prior to their release, in the manner set forth in the Audit Committee charter. Among its other responsibilities, as set forth in its charter, the Audit Committee reviews the arrangements for and the results of the auditor’s examination of the Company’s books and records, auditors’ compensation, internal accounting control procedures, and activities and recommendations of the Company’s internal auditors, as well as any reports relating to the integrity of our financial statements, internal financial controls or auditing matters that are reported on our anonymous Alertline. The Audit Committee also reviews the Company’s significant accounting policies, control systems, reserving practices, information security and disaster recovery programs and compliance with legal and regulatory requirements, as well as the resources of PwC dedicated to or otherwise supporting the Company’s audit. As noted above, the committee is also responsible for reviewing related-person transactions and assisting the Board in assessing the adequacy of the Company’s enterprise risk management program. The Audit Committee annually reviews and reassesses its charter. Compensation Committee The Compensation Committee has oversight responsibility with respect to compensation matters involving directors and executive officers of THG and makes compensation decisions regarding our executive officers (other than the CEO). In conjunction with the Chair of the Board and the NCGC, the Compensation Committee annually reviews the CEO’s performance and other relevant external factors and makes a recommendation to the CID for the CEO’s annual compensation and targets. It also provides general oversight of the Company’s compensation structure, including compensation plans and benefits programs applicable to all employees. Except to the extent reviewed by the Board of Directors, the Committee is also tasked with periodically reviewing the Company’s strategies, policies and practices relating to corporate culture and human capital development, including policies and practices relating to inclusion and diversity. In addition to meeting the independence requirements under the NYSE regulations, each committee member must meet the independence requirements under Section 16. Each of the members of the Compensation Committee satisfies the independence requirements of the NYSE rules and applicable SEC requirements. The Compensation Committee may delegate any of its responsibilities to a subcommittee comprised of one or more of its members. Use of Independent Outside Compensation Consultant In executing its compensation responsibilities, the Compensation Committee engaged Frederic W. Cook & Co., Inc. (“ F.W. Cook” ), to assist it in making compensation decisions and to provide related information and advice. During 2018, F.W. Cook: regularly attended, either in person or telephonically, Compensation Committee meetings; provided relevant market and comparative data and information; provided advice regarding compensation trends and developments; • provided input to the Compensation Committee and management regarding the selection of peer companies against which to evaluate compensation levels and practices; • assisted in the review and design of our director and executive compensation programs; • provided advice with respect to compensation decisions relating to our executive officers and directors; and • reviewed and provided comments to the executive compensation disclosure in this Proxy Statement. F.W. Cook was selected by, and reports to, the Compensation Committee. F.W. Cook is not engaged by the Company for any other purpose, and the Compensation Committee reviews all compensation payable to this firm. Pursuant to its charter, the Compensation Committee may select its outside compensation consultant only after taking into consideration factors relevant to that consultant’s independence, including such factors required to be considered under the listing standards of the NYSE. The Compensation Committee reviewed such factors as it deemed appropriate, including all such factors required by the NYSE listing standards, and is satisfied as to F.W. Cook’s independence from the Company and its management. Compensation Committee Interlocks and Insider Participation During 2018, our Compensation Committee consisted of Ms. Egan and Messrs. Henry and Knox. In addition, Mr. Angelini served on the Compensation Committee until his retirement from the Board in May 2018. None of our executive officers serve, or • • • •