Purposes, Resources and General Considerations
The Human Resources and Compensation Committee (the "Committee") is appointed by the Board of Directors (the "Board") for the following purposes:
- to review and approve corporate goals and objectives relevant to the compensation of the Corporation's Chief Executive Officer (the "CEO"), evaluate the CEO's performance in light of those goals and objectives and, to determine and approve the CEO's Compensation on the basis of its evaluation;
- to oversee executive compensation;
- to make recommendations concerning equity-based plans that are subject to Board approval;
- to produce a compensation committee report on Executive Officer compensation as required by the Securities and Exchange Commission to be included in the listed company's annual proxy statement or annual report on Form 10-K filed with the SEC;
- to have general oversight responsibility for the employee compensation and benefit policies and programs of the Corporation;
- to have general oversight responsibility for the management development and succession programs of the Corporation;
- to have specific responsibility for the development and oversight of a succession plan for the position of CEO;
- to have general oversight responsibility for engagement with the Corporation's stakeholders on executive compensation matters;
- to oversee the Corporation's programs for diversity and inclusion;
- in conjunction with the Corporation's chief risk officer, on an annual basis, to review the Corporation's compensation plans and arrangements in accordance with applicable laws and regulations to ensure that they are well-balanced and do not encourage imprudent risk-taking;
- to administer and make awards under the Corporation's various equity-based employee incentive plans or to delegate such authority in accordance with the terms of such plans;
- to oversee certain retirement plans sponsored by the Corporation with the objective that, on behalf of the Corporation as plan sponsor:
- they provide an appropriate level of benefits in a cost effective manner to meet the needs and objectives of the Corporation in sponsoring such plans, including the objective of providing competitive compensation and retaining employees;
- they are properly and efficiently administered in accordance with their terms, to avoid unnecessary costs and to minimize any potential liabilities to the Corporation,
- the Corporation's responsibilities as plan sponsor are satisfied, and
- financial and other information with respect to such plans is properly recorded and reported in accordance with applicable legal requirements.
In carrying out its responsibilities, each Committee member shall be entitled to rely on the integrity and expertise of those persons, both internal and external, providing information to the Committee, and on the accuracy and completeness of such information, absent actual knowledge to the contrary.
The Committee will have the resources and authority appropriate to discharge its responsibilities, including sole authority to retain and terminate the engagement of such compensation consultants, independent counsel or other consultants or experts (each, an “Advisor”) to advise the Committee as the Committee may deem necessary or helpful in carrying out its responsibilities, and to establish the fees and other terms for the retention of such Advisors, such fees to be borne by the Corporation. To the extent required by New York Stock Exchange (“NYSE”) rules, the Committee shall be directly responsible for the appointment, compensation and oversight of the work of any Advisor it retains. The Committee may select or receive advice from an Advisor only after taking into consideration all factors relevant to the Advisor’s independence from management, including the factors set forth in the NYSE’s rules.
As used in this Charter, (i) "Compensation" shall include salary and any bonuses, equity awards, retirements benefits, deferred compensation benefits and, where appropriate, perquisites; (ii) "Corporation" means The Bank of New York Mellon Corporation and its subsidiaries, and (iii) "Executive Officers" means those persons from time to time determined by the Board of Directors to be "officers" as defined in Rule 16a-1(f) under the Securities Exchange Act of 1934 (the "Exchange Act") or any successor provision or "Executive Officers" as defined in Rule 3b-7 under the Exchange Act or any successor position (which groups shall consist of the same officers).
Composition, Meetings and Procedures
The Committee members and its Chairman shall be appointed annually by the Board of Directors upon the recommendation of the Corporate Governance, Nominating and Social Responsibility Committee and shall serve at the pleasure of the Board of Directors.
The Committee shall consist of three or more members, who shall (a) satisfy (i) the independence and any other requirements of the listing standards of the NYSE and (ii) any applicable legal requirement for members of a committee with the duties of the Committee, and (b) qualify as (i) "non-employee directors" within the meaning of Rule 16b-3 promulgated under the Exchange Act, as amended and (ii) "outside directors" within the meaning of Section 162(m) of the Internal Revenue Code of 1986, as amended.
Except as limited by law, regulation or the rules of the NYSE, the Committee may form subcommittees for any purpose that it deems appropriate and may delegate to such subcommittees or to members of the Corporation's management such power and authority as it deems appropriate, provided, however, that any such subcommittees shall meet all applicable independence requirements and that the Committee shall not delegate to persons other than independent directors any functions that are required — under applicable law, regulation, or stock exchange rule — to be performed by independent directors.
The Committee shall meet as frequently as necessary to fulfil its duties and responsibilities, but not less frequently than quarterly. A meeting of the Committee may be called by its chairman or any two members of the Committee.
Minutes of the meetings will be approved by the Committee and maintained by the Committee. The Committee shall report its activities to the Board of Directors on a regular basis. The agenda for each regularly scheduled Committee meeting shall provide time during which the Committee can meet separately, without members of management present, in executive session.
Specific Responsibilities and Duties
Duties Related to Executive and Other Compensation
The Committee shall have the responsibility to:
- establish the Compensation of (a) the Chief Executive Officer (as more fully described below) and (b) each other Executive Officer;
- determine, administer and make (or delegate the authority to make) equity and/or cash awards under plans adopted for the benefit of officers and other employees of the Corporation to the extent required or permitted by the terms of such plans, establish any related performance goals, determine whether and the extent to which such goals have been attained and, if necessary, determine whether any adjustments for risk or otherwise should be made;
- in determining the long-term incentive compensation component of the Compensation of the CEO, consider, among other factors, the Corporation's performance and relative stockholder return, the value of incentive awards made to chief executive officers at comparable companies, the awards given to the CEO in past years, the terms of any employment agreement with the CEO, the economic environment and general market conditions;
- in determining the CEO's base salary, consider the terms of any existing employment agreement and such additional factors as the Committee deems appropriate;
- periodically review the appointment, promotion, performance and potential of senior managers of the Corporation and the potential successors of such senior managers, and make reports and recommendations to the Board of the Corporation with respect to such matters to the extent it deems appropriate;
- periodically review programs to facilitate (a) the selection and development of key managers and (b) diversity and inclusion in the workforce more broadly;
- review succession plans for the CEO and other Executive Officers and members of the Corporation's Executive Committee;
- review the Corporation's annual Compensation Discussion and Analysis, discuss it with management and, on the basis of that review and discussion, recommend that it be included in the Corporation's annual report on Form 10-K or the Corporation's proxy statement;
- authorize the publication of the "Compensation Committee Report" over the names of its members;
- establish stock ownership guidelines for Executive Officers and other members of the Corporation's Executive Committee, and periodically review compliance with such guidelines;
- review and approve employment agreements with (a) each member of the Corporation's Executive Committee, whether or not such member is an Executive Officer, and (b) each Executive Officer who is not on the Corporation's Executive Committee;
- with regard to employee benefit and compensation plans:
- review, adopt and, where required, recommend to the Board for approval, all new equity-based employee benefit plans and any material changes to existing equity-based employee benefit plans, provided, however, that, to the extent provided by the rules of the NYSE, amendments to equity-based incentive plans may be made only upon approval of the Corporation's stockholders;
- review, adopt, approve and amend any non-equity-based incentive-compensation plans in which Executive Officers and other members of the Corporation's Executive Committee may participate; and
- review, adopt, and amend any other employee benefit plans that cause material increases in expenses, except to the extent the authority to take such actions has been delegated to management;
- annually review and assess the adequacy of this Charter and recommend changes to the Board of Directors as necessary (the Charter will be published on the Corporation’s website and the Corporation will disclose in its annual proxy statement that this charter is available on its website and provide the website address);
- annually arrange for an evaluation (which may be a self-evaluation) of the Committee's performance, which performance evaluation shall be conducted in such manner as the Committee and the Corporate Governance, Nominating and Social Responsibility Committee deem appropriate; and
- perform any other activities consistent with this Charter, the Corporation's By-Laws and governing law as the Board of Directors shall specifically delegate to the Committee.
Duties Related to Welfare Plans
Except as otherwise specified herein, the Committee delegates (a) to the Corporation's management the settlor responsibilities for (i) the Corporation's welfare plans, as defined in the Employee Retirement Income Security Act of 1974, as amended ("ERISA"), and (ii) any similar health and welfare plans (the plans mentioned in clauses (i) and (ii) being collectively referred to as the "Welfare Plans"), and (b) to the head of the Corporation's Human Resources Department the fiduciary responsibilities, if any, for the Welfare Plans.
Duties Related to Pension Plans
The Committee shall provide oversight for pension, savings, employee stock ownership, deferred compensation and all other retirement plans (collectively, the "Pension Plans"), including, for any Pension Plans subject to the funding, administrative or fiduciary responsibility rules of ERISA, oversight of management's attestation that the Plans are in substantial compliance with ERISA.
On at least an annual basis, the Committee shall review financial information relating to the assets, changes in actuarial assumptions and potential funding requirements of the Pension Plans.
The Committee shall periodically receive reports on filings made with government agencies or other regulatory authorities relating to the financial status of the Pension Plans.
The Committee may receive periodically reports on significant issues related to the Corporation's non- U.S. based retirement programs.
In no event shall the Committee act as a named fiduciary (within the meaning of ERISA) of the Pension Plans, meaning, among other things, that the Committee shall have (a) no discretionary authority to manage or administer any Pension Plan, and (b) no investment authority with respect to any assets of the Pension Plans. Such authority is expressly reserved for the Named Fiduciary Committee or Committees of each Pension Plan.
Dated: February 20, 2020