Pier 1 2011 Annual Report Download - page 92

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Imports’ directors, officers and employees, including our chief executive officer, chief financial officer and
principal accounting officer, and charters for each of the board of directors’ committees. The nominating and
corporate governance committee is responsible for overseeing and reviewing the guidelines at least annually, and
recommending any proposed changes to the full board for its approval. The Pier 1 Imports, Inc. Corporate
Governance Guidelines, Code of Business Conduct and Ethics, Ethics Compliance Policies and Procedures and
charters for the audit, compensation, and nominating and corporate governance committees are available on Pier 1
Imports’ web site at www.pier1.com at the Investor Relations – Corporate Governance link.
Board Leadership Structure
Pier 1 Imports’ bylaws require that the directors elect annually from among themselves a chairman of the
board. The bylaws, however, grant the board of directors discretion as to whether the chairman of the board is an
employee or an officer of Pier 1 Imports. A non-officer, non-employee elected as chairman of the board is
designated as the “non-executive” chairman of the board. Pier 1 Imports’ corporate governance guidelines, policies
and procedures contain general guidance that the positions of chairman of the board and chief executive officer
should be held by separate individuals and that the chairman of the board should be a “non-executive.” Provisions
are made in the guidelines, policies and procedures for an independent lead director if the roles of chairman of the
board and chief executive officer are combined.
During the fiscal year the chairman of the board and chief executive officer roles were held by separate
individuals and the chairman of the board was a “non-executive” since he was neither an employee nor an officer of
Pier 1 Imports. Currently, the chairman of the board is a non-executive. This structure of separate individuals
holding these positions focuses board leadership and company leadership in separate and distinct individuals. Each
leader can direct her or his respective group on the objectives at hand while at the same time developing and
implementing strategic issues, financial issues and operational policies which affect the short- and long-term welfare
of Pier 1 Imports.
Director Independence
It is Pier 1 Imports’ policy that the board of directors will at all times consist of a majority of independent
directors. In addition, all members of the audit committee, compensation committee, and nominating and corporate
governance committee must be independent. To be considered independent, a director must satisfy both the
subjective and objective independence requirements established by the New York Stock Exchange (“NYSE”). In
assessing independence under the subjective test, the board of directors takes into account the standards in the
objective tests, and reviews and discusses additional information provided by the directors and Pier 1 Imports with
regard to each director’s business and personal activities as they may relate to Pier 1 Imports and Pier 1 Imports’
management. Based on the foregoing, as required by NYSE rules, the board of directors makes a subjective
determination as to each independent director that no material relationship exists with Pier 1 Imports. The board of
directors will broadly consider all relevant facts and circumstances relating to a director in determining whether that
director is independent.
On April 19, 2010, Robert B. Holland, III resigned from the board of directors. On April 26, 2010, the board of
directors reduced the number of directors comprising the board from seven to six. On April 30, 2010, Karen W.
Katz announced her decision not to stand for re-election to the board of directors at the annual meeting of
shareholders held on June 29, 2010. On May 5, 2010, the board of directors set the number of directors comprising
the board at five for election at the June 29, 2010 annual meeting.
On January 18, 2011, the board of directors increased the size of the board of directors from five directors to
seven directors and elected to the board of directors Hamish A. Dodds and Brendan L. Hoffman. On March 25,
2011, the board of directors increased the size of the board of directors from seven directors to eight directors and
elected to the board of directors Claire H. Babrowski.
Based on the NYSE independence requirements, the board of directors has determined that seven of the eight
current members of the board of directors are independent. They are directors Ms. Babrowski, John H. Burgoyne,
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