English - The Clorox Company

PERFORMANCE
Governance and Ethics
World-Class Governance
Clorox maintains rigorous corporate governance practices and internal controls with oversight by our board
of directors, chairman and chief executive officer, chief financial officer, general counsel and the other
members of the company’s executive committee. The board’s responsibility includes overseeing management’s
operations of the company’s business, monitoring the effectiveness of management policies and decisions,
including the development and execution of its strategies, risk management activities and providing for
management succession.
The quality of our corporate governance is rated stronger than 94.3 percent of S&P 500 companies and
98.5 percent of household and personal products companies according to RiskMetrics Group, which has
rated more than 7,400 companies worldwide on corporate governance practices.*
Our board of directors is composed of individuals
who, on the basis of their knowledge and experience,
make valuable contributions to the overall conduct
of the business. The nominating and governance
committee is responsible for developing and recommending
board membership criteria to the board for
approval and periodically reviewing these criteria.
Board candidates, including incumbent directors,
are considered based upon various criteria, including
their broad-based business skills and experiences,
prominence and reputation in their professions,
global business and social perspective, concern
for the long-term interests of the stockholders, and
personal integrity and judgment. In addition to the
board and committees’ conducting self evaluations
on an annual basis, the nominating and governance
committee reviews general qualifications and expertise
of each board member on at least an annual basis.
Committees of the Board of Directors
Executive Committee acts for the board in certain
matters when the full board cannot be convened.
Audit Committee oversees the integrity of
financial statements, the company’s accounting
and financial controls, including independent and
internal auditors.
Finance Committee oversees and makes
recommendations to the board with respect to
the company’s major financial policies and actions,
including capital structure and borrowing.
Management Development and Compensation
Committee oversees management development
and succession planning processes and approves
compensation for executive management and various
benefit plans for the company as a whole.
Nominating and Governance Committee oversees
the company’s corporate governance practices, director
nominations and board evaluation. Also oversees the
company’s compliance with certain legal and regulatory
requirements and discusses with management the
status of pending litigation, environmental issues
and other areas of oversight as may be appropriate.
Executive Compensation
The board of directors’ management and compensation
committee, composed entirely of independent
directors as required by the NYSE listing standards
and consistent with SEC rule 16b-3, reviews the design
and implementation of our executive management
program. The committee applies a rigorous and
balanced approach to executive compensation,
ensuring that compensation is tied to current and
long-term company performance; is sufficient to
attract and retain high-caliber, experienced leaders;
aligns the interests of our executive officers with
the interests of our stockholders; and is financially
efficient, resulting in a reasonable level of costs
that are supported by performance.
* RiskMetrics, December 2009
16 The Clorox Company | 2010 CRR