Guided by a belief that what benefits our associates is likewise good for the business and its stockholders, coupled with our desire to Build a Better World, RPM has developed corporate governance and ethics practices that create long-term stakeholder value by leveraging the success of its 15,500 associates worldwide and promoting balanced decisions and reasonable oversight through thoughtful leadership.
Our culture of continuous improvement is largely guided by The Value of 168, a corporate philosophy set forth by RPM’s founder Frank C. Sullivan. The Value of 168 comes to life through motivated associates who enjoy their work and create the conditions that allow our customers to grow and our stakeholders to prosper. Our code of business conduct and ethics, The Values & Expectations of 168, and its core principles are the cornerstone for all decision-making at RPM.
Since 1977, outside Directors have comprised a majority of our Board of Directors, with only independent Directors having served on the Audit and Compensation Committees. These practices were in place at RPM nearly three decades prior to being mandated by the New York Stock Exchange.
With our leading code of conduct, policies, commitment to transparency, independent board and generous benefits program, RPM fosters and encourages a culture of excellence, diversity, equity and inclusivity. Our commitment to meeting high standards of ethical behavior, corporate governance and business conduct has led RPM to implement the practices shown here.
In fiscal 2021, RPM established an Environmental, Social and Governance Oversight Committee comprised of, among others, RPM’s Vice President – Corporate Benefits & Risk Management, Senior Vice President, General Counsel and Chief Compliance Officer, and Vice President – Operations and Chief Restructuring Officer, to:
We, at RPM, are committed to competing vigorously in all aspects of business but will only do so in an ethical and responsible manner. In our drive to Build a Better World we will continue to be responsible entrepreneurs and always behave with the highest integrity and moral courage.
We invite you to learn more about RPM and its practices by exploring this website and reading our Values & Expectations of 168 as well as our ESG Report.
When identifying and evaluating candidates for Board roles, the Committee actively seeks qualified candidates who reflect diverse backgrounds. In January 2020, RPM formalized this commitment by adopting the Rooney Rule for filling Board vacancies — a mandate to include diverse candidates in the selection pool for each new Board vacancy, accounting for diversity in ethnicity and gender.
We are proud of out long-standing commitment to gender diversity, particularly on our Board.
BOARD COMPOSITION
BOARD COMMITTEES
All Directors on the Audit, Compensation, and Governance and Nominating Committees are independent.
Board Independence– ten of eleven Directors are independent under RPM’s Corporate Governance Guidelines and New York Stock Exchange listing standards. All members of the Audit Committee, the Compensation Committee and the Governance and Nominating Committee are independent.
Independent Directors Meetings– independent Directors meet in executive sessions each year in January, April and July, without management present.
Lead Director– one independent Director serves as Lead Director.
Majority Voting for Directors– in an uncontested election, any nominee for Director who receives more votes “withheld” from his or her election than votes “for” such election is expected to tender his or her resignation for prompt consideration by the Governance and Nominating Committee and by the Board of Directors.
Director Tenure– the average tenure of RPM’s independent Directors has decreased from 16.5 years for each independent Director in 2011 to 9.2 years as of May 31, 2021, and six of RPM’s current independent Directors joined the Board of Directors since 2012.
Adoption of Rooney Rule– the Governance and Nominating Committee of the Board of Directors adopted the “Rooney Rule” under which the Governance and Nominating Committee set forth in its Charter its commitment to include, for the purposes of filing any vacancies on the Board of Directors, qualified candidates who reflect diverse backgrounds, including diversity of gender and ethnicity, in each search for new Directors.
Stock Ownership Guidelines for Directors and Executive Officers– RPM adopted stock ownership guidelines for Directors and executive officers in July 2012 and increased the stock ownership guidelines for Directors in July 2014.
Annual Board and Chief Executive Officer Self-Evaluations– each year, the Governance and Nominating Committee of the Board of Directors administers self-evaluations of the Board of Directors and its committees, and the Compensation Committee of the Board of Directors administers an evaluation of the Chief Executive Officer.
Hedging Transactions Prohibited– RPM’s Insider Trading Policy prohibits short sales and hedging transactions of shares of RPM’s Common Stock by Directors, officers and employees.
Pledging Prohibited– RPM’s Insider Trading Policy prohibits the pledging of shares of RPM’s Common Stock by Directors, officers and employees, subject to limited exceptions.
Performance-Based Compensation– RPM relies heavily on performance-based compensation for executive officers, including awards of performance-based restricted stock.
Double-Trigger Vesting Provisions– the Amended and Restated RPM International Inc. 2014 Omnibus Equity and Incentive Plan provides double-trigger vesting provisions for long-term equity awards.
Clawback Policy– the Board of Directors may require reimbursement of certain bonuses or incentive compensation awarded to an executive officer if, as the result of that executive officer’s misconduct, RPM is required to restate all or a portion of its financial statements.
Chief Executive Officer Succession Planning– RPM’s succession plan, which the Board of Directors reviews annually, addresses both an unexpected loss of the Chief Executive Officer as well as longer-term succession.
The Values & Expectations of 168– RPM’s code of business conduct and ethics, Values & Expectations of 168, emphasizes individual responsibility and accountability, encourages reporting and dialogue about ethical concerns, and focuses on RPM’s core principles of integrity, commitment, responsible entrepreneurship and moral courage.
Statement of Governance Policy– the Board of Directors adopted RPM’s Statement of Governance Policy in 2016, which recognizes that conducting RPM’s business in conformity with Values & Expectations of 168 is essential to advancing RPM’s fundamental objective of building long-term stakeholder value.
Environmental, Social and Governance (ESG) Oversight– the Governance and Nominating Committee of the Board of Directors oversees RPM’s efforts to identify sustainability risks and opportunities, and the development and implementation of initiatives RPM may institute from time to time relating to same.
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