Annual Report 2016

A BMO employee offers advice.
 

Corporate Governance

When we measure BMO’s performance, shareholder return is an important metric – but only as it reflects a more fundamental commitment to earning the trust of all stakeholders. We have a responsibility not simply to meet regulatory requirements, but to act in accordance with our stated values. And the cornerstone of our efforts is sound corporate governance. We’ve changed successfully over the past 200 years because of good governance, keeping an eye on the long term, and focusing on what is right for our customers.

Our board oversees our business.

Our Board of Directors provides stewardship, including direction-setting and general oversight of our management and operations. Its members have sophisticated expertise and a range of perspectives. The board approves the bank’s overall strategy and makes decisions based on BMO’s values, emphasizing long-term performance over short-term gain.

The board operates independently of management.

The Chairman of the Board and our directors, other than the Chief Executive Officer, operate independently of management. Board meetings include time for the independent directors to meet without management or non-independent directors present.

Our focus on diversity reflects our values.

The diverse backgrounds of our directors help us connect with our customers, our markets and our employees. A diverse board also helps us make better decisions. Our Board Diversity Policy facilitates effective governance by positioning the board to be made up of highly-qualified directors. The policy includes the goal that each gender comprise at least one-third of the independent directors. We are proud to report that more than one-third of BMO’s independent directors are women.

In addition, the board oversees the development of the next generation of leaders at BMO, ensuring the bank has a solid, diverse team of executives to keep BMO strong and growing in the years to come.

We compensate our directors and executives in ways that encourage good decisions.

Our model for compensating directors and executives follows best practices for good governance. We use a pay-for-performance model for executives that includes clawbacks and discourages unreasonable risk-taking. Directors and executives must own shares, in order to align their interests with those of other shareholders. We do not allow directors and employees to hedge their investments in our shares, securities or related financial instruments.

We maintain a strong focus on ethical conduct.

Our culture is open, fair and transparent. We have a non-negotiable commitment to doing what’s right, supported by our Code of Conduct, a board-approved set of principles that is based on our values of integrity, empathy, diversity and responsibility – and is applicable to our Board of Directors and everyone who works at BMO.

Our board and management stay connected with our shareholders.

Transparency is key, and communication is essential. We engage and inform our shareholders through our annual meeting of shareholders, annual report, management proxy circular, annual information form, sustainability report, corporate responsibility report, quarterly reports, news releases, earnings conference calls, industry conferences and other ad hoc meetings of shareholders with members of management and our Board of Directors. Our website provides extensive information about the board, its mandate, the board committees and their charters, and our directors.


 

Board of Directors1

To promote alignment of our strategic goals across all our businesses, each director serves on at least one board committee and the Chief Executive Officer is invited to all committee meetings. We review the membership of all committees annually.
www.bmo.com/corporategovernance

Janice M. Babiak

Board/Committees:

Audit and Conduct Review, Risk Review


Other public boards:

Walgreens Boots Alliance, Inc.


Director since 2012

Sophie Brochu

Sophie Brochu, C.M.

President and Chief Executive Officer, Gaz Métro

Board/Committees:

Audit and Conduct Review


Other public boards:

BCE Inc., Bell Canada, Valener Inc.


Director since 2011

George A. Cope

George A. Cope, C.M.

President and Chief Executive Officer, Bell Canada and BCE Inc.

Board/Committees:

Governance and Nominating, Human Resources


Other public boards:

BCE Inc., Bell Canada


Director since 2006

William A. Downe

William A. Downe, C.M.

Chief Executive Officer, BMO Financial Group

Board/Committees:

Attends all committee meetings as an invitee


Other public boards:

ManpowerGroup


Director since 2007

Christine A. Edwards

Christine A. Edwards

Capital Partner, Winston & Strawn

Board/Committees:

Governance and Nominating (Chair), Human Resources, Risk Review


Director since 2010

Dr. Martin S. Eichenbaum

Dr. Martin S. Eichenbaum

Charles Moskos Professor of Economics, Northwestern University

Board/Committees:

Audit and Conduct Review, Risk Review


Director since 2015

Ronald H. Farmer

Ronald H. Farmer

Managing Director, Mosaic Capital Partners

Board/Committees:

Audit and Conduct Review, Governance and Nominating, Human Resources (Chair)


Director since 2003

Eric R. La Flèche

Eric R. La Flèche

President and Chief Executive Officer, Metro Inc.

Board/Committees:

Risk Review


Other public boards:

Metro Inc.


Director since 2012

Lorraine Mitchelmore

Lorraine Mitchelmore

Corporate Director

Board/Committees:

Human Resources, Risk Review


Director since 2015

Philip S. Orsino

Philip S. Orsino, O.C., F.C.P.A., F.C.A.

President and Chief Executive Officer, Brightwaters Strategic Solutions, Inc.

Board/Committees:

Audit and Conduct Review (Chair), Governance and Nominating


Other public boards:

Hydro One Inc., Hydro One Limited


Director since 1999

J. Robert S. Prichard

J. Robert S. Prichard, O.C., O.Ont., FRSC, F.ICD

Chairman of the Board, BMO Financial Group, and Chair of Torys LLP

Board/Committees:

Governance and Nominating, Human Resources, Risk Review


Other public boards:

Barrick Gold Corporation, George Weston Limited, Onex Corporation


Director since 2000

Don M. Wilson III

Don M. Wilson III

Corporate Director

Board/Committees:

Governance and Nominating, Human Resources, Risk Review (Chair)


Director since 2008



   1 As at October 31, 2016.


 

Honorary Directors

Robert M. Astley, FCIA, F.ICD, LL.D.
Waterloo, ON

Stephen E. Bachand,
Ponte Vedra Beach, FL, USA

Ralph M. Barford, C.M., M.B.A., LL.D., F.ICD,
Toronto, ON

Matthew W. Barrett, O.C., LL.D.,
Oakville, ON

David R. Beatty, C.M., O.B.E., F.ICD,
Toronto, ON

Peter J.G. Bentley, O.C., O.B.C., LL.D.,
Vancouver, BC

Robert Chevrier, F.C.A.,
Montreal, QC

Tony Comper, C.M., LL.D.,
Toronto, ON

C. William Daniel, O.C., LL.D.,
Toronto, ON

A. John Ellis, O.C., LL.D., O.R.S.,
Vancouver, BC

John F. Fraser, O.C., LL.D., O.R.S.,
Winnipeg, MB

David A. Galloway,
Toronto, ON

Richard M. Ivey, C.C., Q.C.,
Toronto, ON

Betty Kennedy, O.C., LL.D.,
Campbellville, ON

Harold N. Kvisle,
Calgary, AB

Eva Lee Kwok,
Vancouver, BC

J. Blair MacAulay,
Oakville, ON

Ronald N. Mannix, O.C.,
Calgary, AB

Robert H. McKercher, Q.C.,
Saskatoon, SK

Bruce H. Mitchell,
Toronto, ON

Eric H. Molson,
Montreal, QC

Jerry E.A. Nickerson,
North Sydney, NS

Dr. Martha C. Piper, O.C., O.B.C., FRSC,
Vancouver, BC

Jeremy H. Reitman,
Montreal, QC

Lucien G. Rolland, O.C.,
Montreal, QC

Guylaine Saucier, F.C.P.A., F.C.A., C.M., F.ICD,
Montreal, QC

Nancy C. Southern,
Calgary, AB

 

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