Apple 2003 Annual Report Download - page 81

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Role of the Board; Corporate Governance Matters
It is the paramount duty of the Board of Directors to oversee the Chief Executive Officer and other senior management in the competent and
ethical operation of the Company on a day-to-day basis and to assure that the long-term interests of the shareholders are being served. To
satisfy this duty, the directors take a proactive, focused approach to their position, and set standards to ensure that the Company is committed to
business success through maintenance of the highest standards of responsibility and ethics.
Members of the Board bring to the Company a wide range of experience, knowledge and judgment. These varied skills mean that good
governance depends on far more than a "check the box" approach to standards or procedures. The governance structure in the Company is
designed to be a working structure for principled actions, effective decision-making and appropriate monitoring of both compliance and
performance. The key practices and procedures of the Board are outlined in the Corporate Governance Guidelines available on the Company's
website at www.apple.com/investor.
Board Committees
The Board has a standing Compensation Committee, a Nominating and Corporate Governance Committee (" Nominating Committee" ) and an
Audit and Finance Committee (" Audit Committee ").
The Compensation Committee is primarily responsible for reviewing the compensation arrangements for the Company's executive officers,
including the Chief Executive Officer, and for administering the Company's stock option plans. Members of the Compensation Committee are
Messrs. Campbell, Drexler, Gore and Dr. Levinson.
The Nominating Committee assists the Board in identifying qualified individuals to become directors, determines the composition of the Board
and its committees, monitors the process to assess Board effectiveness and helps develop and implement the Company's corporate governance
guidelines. Members of the Nominating Committee are Messrs. Campbell, Drexler, Gore and Dr. Levinson.
The Audit Committee is primarily responsible for overseeing the services performed by the Company's independent auditors and internal audit
department, evaluating the Company's accounting policies and its system of internal controls and reviewing significant financial transactions.
Consistent with the Nasdaq audit committee structure and membership requirements, the Audit Committee is comprised of three members:
Messrs. Campbell, York and Dr. Levinson. Because of Mr. York's affiliation with MicroWarehouse, (see Item 13. Certain Relationships and
Related Transactions), he is deemed to be a "non-independent" director. As permitted under the Nasdaq requirements, the Board carefully
considered Mr. York's affiliation with MicroWarehouse as well as his accounting and financial expertise and determined that it is in the best
interest of the Company and its shareholders that he continue to serve as a member of the Audit Committee. Both Mr. Campbell and
Dr. Levinson are independent directors.
The Audit, Compensation and Nominating Committees operate under written charters adopted by the Board. These charters are available on the
Company's website at www.apple.com/investor.
Audit Committee Financial Expert
While more than one member of the Company's Audit Committee qualifies as an "audit committee financial expert" under Item 401(h) of
Regulation S-K, Mr. William V. Campbell, the Committee chairperson, is the designated audit committee financial expert. Mr. Campbell is
considered "independent" as the term is used in Item 7(d)(3)(iv) of Schedule 14A under the Exchange Act.
Code of Ethics
The Company has a code of ethics that applies to all of the Company's employees, including its principal executive officer, principal financial
officer and principal accounting officer. A copy of this code, "Ethics: The Way We Do Business Worldwide" is available on the Company's
website at www.apple.com/investor and is filed as an exhibit to this annual report on Form 10-K. The Company intends to disclose any
105
changes in or waivers from its code of ethics by posting such information on its website or by filing a Form 8-K.
Executive Officers
The following sets forth certain information regarding executive officers of the Company. Information pertaining to Mr. Jobs, who is both a
director and an executive officer of the Company, may be found in the section entitled "
Directors.
"