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For the “D,” 3M development teams within each of our business groups draw upon our core technologies to create products for targeted markets and geographies. |
We will continue to expand beyond our own operations and focus more on 3M Sustainability goals and the needs of our customers and communities. While we recognize the importance of what we do in our own businesses and will continue to innovate there, we see that far greater impact can be realized when we partner with ot... |
Just as Sustainability is embedded throughout our Value Model, sustainable thinking is embedded into the core of 3M and in the strategic planning process we use for every region, every market, and every business. |
In each of our business groups and regions, we have dedicated Sustainability leaders who develop a relevant and well-informed strategy specific to their market demands and business goals. |
Annually, like many companies, we go through a strategic planning process during which our divisions develop their business strategies for the next few years. However, unlike other companies, we formally require that each plan addresses Sustainability factors relevant to the division’s market needs and business opportu... |
How we work 84 85 3M 2020 Sustainability Report #improvinglives Introduction |
3M believes that good corporate governance practices serve the long-term interests of shareholders, strengthen the Board and management, and further enhance the public trust 3M has earned from more than a century of operating with uncompromising integrity and doing business the right way. Our commitment. |
Our corporate governance principles govern how we do business daily, enabling us to outperform and lead the way to sustainable growth. They provide a framework that defines the roles, rights, and responsibilities of different groups within the organization, the Board’s role in risk oversight, public policy engagement, ... |
3M’s Board of Directors oversees the CEO and senior management and assures that appropriate procedures and controls are in place covering management’s activities in operating the company on ethical grounds on a day-to-day basis. |
The Board of Directors believes that this leadership structure provides independent Board leadership and engagement while deriving the benefits of having our CEO also serve as Chairman of the Board. As the individual with primary responsibility for managing 3M’s day-to-day operations and with indepth knowledge and unde... |
Coupled with an independent Lead Director, this combined structure provides independent oversight while avoiding unnecessary confusion regarding the Board’s oversight responsibilities and the day-to-day management of business operations. |
The Board plans the succession to the position of Chairman/CEO and other senior management positions. To assist the Board, the Chairman/ CEO and Senior Vice President of Human Resources annually assess senior managers and their succession potential for the position of Chairman/ CEO and other senior management positions... |
Board’s role in the company’s long-term strategy. |
Each year management presents to the Board, and the Board discusses and approves, detailed long-term strategic plans for the company. In addition to the overall strategic plan for 3M and the business groups, the discussions also focused on breakout sessions with the directors on strategic corporatewide themes of portfo... |
Our long-term strategy is outlined in the 3M Value Model. The 3M Value Model is what differentiates our company in the marketplace. It’s how we create extraordinary value for customers and premium returns for shareholders. The model is built around four elements: our Vision, our strengths, our priorities, and our Value... |
Corporate governance 3M’s Board of Directors has adopted Corporate Governance Guidelines which provide a framework for the effective governance of the company. The guidelines address matters such as the respective roles and responsibilities of the Board including leadership structure, responsibilities of the independen... |
The Board’s current leadership structure is characterized by: • A combined Chairman of the Board and CEO • A strong, independent, and highly experienced Lead Director with welldefined responsibilities that support the Board’s oversight responsibilities • A robust committee structure consisting entirely of independent d... |
How we work 86 87 3M 2020 Sustainability Report #improvinglives Corporate governance |
Lobbying and Political Activities Principle. |
As a concerned member of our communities, 3M actively participates in public policy and legislative advocacy, or “lobbying.” As appropriate, 3M also participates in political activities to elect and work with elected representatives and government officials. 3M’s Government Affairs organization coordinates and oversees... |
Board membership criteria 3M’s Corporate Governance Guidelines contain Board Membership Criteria which include a list of key skills and characteristics deemed critical to serve 3M’s long-term business strategy and expected to be represented on 3M’s Board. The Nominating and Governance Committee periodically reviews wit... |
It is the intent of the Board that the Board itself will be a high-performance organization creating competitive advantage for the company. To perform as such, the Board will be composed of individuals who have distinguished records of leadership and success in their arena of activity and who will make substantial cont... |
In addition to these minimum requirements, the committee will also evaluate whether the nominee’s skills are complementary to the existing Board members’ skills, the Board’s needs for particular expertise in certain areas, and will assess the nominee’s impact on Board dynamics, effectiveness, and diversity of experienc... |
Board refreshment. |
We regularly add directors to infuse new ideas and fresh perspectives into the boardroom. Five out of the 10 independent director nominees standing for this year’s election have joined our Board within the past four years. In recruiting directors, we focus on how the experience and skill set of each individual compleme... |
Shareholder engagement. |
Shareholder engagement is fundamental to our commitment to good governance and essential to maintaining our strong corporate governance practices. We engage regularly with our global investors to gain valuable insights into the governance issues about which they care most. We aim to seek a collaborative and mutually be... |
During 2019, members of senior management met with a cross-section of shareholders owning approximately. |
The meetings included an overview of the company and a discussion of the company’s practices on corporate governance, including Board refreshment and diversity, director evaluation, directors’ skills matrix, Board leadership structure, as well as on strategic priorities, capital allocation and structure, environmental ... |
Director independence. |
The Corporate Governance Guidelines and Director Independence Guidelines provide that independent directors must comprise a substantial majority of the 3M Board. A director is “independent” if the Board affirmatively determines that the director has no material relationship with 3M directly or as a partner, shareholder... |
The Guidelines specify the criteria by which the independence of our directors will be determined, including strict guidelines for directors and their immediate family members with respect to past employment or affiliation with 3M or its independent registered public accounting firm. The Guidelines also prohibit Audit ... |
Diversity. |
For 3M, diversity, in its myriad manifestations, is fundamental to innovation, performance, and relevancy. |
The Board of Directors regards diversity as an important factor in selecting Board nominees to serve on the Board. Although the Board has no specific diversity policy, when selecting nominees, it actively considers diversity in recruitment and nomination of directors, such as gender, race, and national origin. The curr... |
Corporate governance highlights. |
Director Tenure. |
Independent Lead Director Meeting attendance 96% |
Other public company Boards. |
Avg. 7 Avg. 64.3 33.3% 11/12 years 6 |
0-4 Years <59 Years 5-9 Years 60-65 Years 10-14 Years 66-70 Years Women Independent Not Independent 15-19 Years 71-74 Years Men 3 |
1 2 2 3 4 5 11 1 2 years Women Directors Directors are independent. |
Director Age Gender Diversity Board size and independence • Independent Lead Director with robust authority • Combined Chairman and CEO positions • Overall attendance at Board and committee meetings • There were eight Board meetings in 2019. |
Boards Board Boards Boards 3 |
0 1 2 3 5 |
1 3 |
8 1.3 average Board positions of our institutional shareholders. |
29% 42% of our outstanding shares or approximately. |
How we work 88 89 3M 2020 Sustainability Report #improvinglives Corporate governance |
An inclusive culture at 3M is built on our Be Respectful Principles — to respect the dignity and worth of individuals; encourage the initiative of each employee; challenge individual capabilities; and provide equal opportunity. 3M is continuously focusing on building and maintaining an inclusive culture. Additional inf... |
Governance actions. |
As we continually seek ways to improve corporate governance, our Board announced in November 2019 that it had established a new committee to strengthen oversight of the company’s strategies related to research and development, commercialization, Sustainability, environmental stewardship and other related activities. Th... |
As a science-based company that relies on investments and capabilities in R&D, commercialization and Sustainability for our success, this new committee aligns with 3M’s strategic priorities and enables the Board greater focus and engagement on a critical element of our strategy. |
In addition to forming the Science, Technology & Sustainability Committee, the Board has ended the Finance Committee. The responsibilities of the Finance Committee will be undertaken by the Audit Committee and the full Board. |
During 2019, the Board of Directors held eight meetings. Overall attendance at Board and committee meetings was 96%. |
Commitment to economic, environmental, and social topics. |
At 3M, we are inspired and motivated by our Vision of advancing every company, enhancing every home and improving every life. In collaboration with our employees, customers, partners, government, and communities, we apply our expertise and technology to help solve shared global challenges. Sustainability is at the hear... |
3M has a long-standing commitment to Sustainability, from our groundbreaking Pollution Prevention Pays program that began in 1975 to our increasingly ambitious set of 2025 Sustainability Goals, which are designed to improve the footprint of our own operations, help our customers meet their own Sustainability goals and ... |
As a global corporation, contributing to society through diverse markets, we believe that we have a significant responsibility to advance the United Nations Sustainable Development Goals across the world. |
We are also a participant of the United Nations Global Compact, a policy initiative for businesses to demonstrate their commitment to 10 principles in the areas of human rights, labor, environment, and anticorruption. We align this Report to the guidelines of the Sustainability Accounting Standards Board (SASB) and the... |
Announced by CEO Mike Roman on Investor Day in November 2018, the Framework directs our efforts to areas where we can make the greatest impact: Science for Circular, Science for Climate, and Science for Community. At 3M, we are inspired and motivated by our Vision of advancing every company, enhancing every home and im... |
How we work 90 91 3M 2020 Sustainability Report #improvinglives Corporate governance |
We regularly post governance news, events, and presentation information in the Investor Relations section of our website. See 3M Events and presentations. |
Looking forward. |
More than a century of operating with uncompromising integrity has earned 3M trust from our customers, credibility with our communities, and dedication from our employees. |
Our continued work across the Strategic Sustainability Framework helps advance 3M’s progress toward our 2025 Sustainability Goals, which is reported on in this Report. Sustainability at 3M is also guided by our Innovation Steering Committee which includes our CEO, CTO, and General Counsel. The committee provides leader... |
In November 2019, the 3M Board of Directors established a new Board-level committee to provide general oversight of the significant scientific and technological aspects of 3M’s businesses and the company’s Sustainability and stewardship activities: the 3M Science, Technology & Sustainability Committee of the Board of D... |
Additional information can be found in our 2020 Proxy, Commitment to Sustainability. |
3M’s Code of Conduct. |
More than a century of operating with uncompromising integrity has earned 3M trust from our customers, credibility with our communities, and dedication from our employees. And for the seventh year in a row, 3M has been recognized by Ethisphere® as one of the World’s Most Ethical Companies®. |
The Code of Business Conduct and Ethics for Directors of the company incorporates long-standing principles of conduct 3M and the Board follow to assure the company’s business and the activities of the Board are conducted with integrity and adherence to the highest ethical standards, and in compliance with the law. |
Our Code of Conduct applies to all employees, including our CEO, Chief Financial Officer, and Chief Accounting Officer. See the Corporate Code of Conduct section for additional details. |
Lobbying and Political Activities Principle. |
All 3M Political Action Committee (PAC) receipts, disbursements, and contributions are publicly disclosed as required by law. 3M’s reports are available on the Federal Election Commission website. Corporate contributions directly to candidates, political committees, ballot measures, Section 527 organizations, and issue... |
Governance links. |
For more information on corporate governance at 3M, see: • Corporate Officers • Board of Directors • Committee Composition • Governance Documents • Annual Reports and Proxy Statements. |
How we work 92 93 3M 2020 Sustainability Report #improvinglives Corporate governance |
Our commitment. |
The concept of risk appetite and tolerance is an essential component of our strategic planning, and it’s the responsibility of our senior business leaders to plan accordingly. |
We firmly believe that good corporate governance practices serve the longterm interests of our stockholders, strengthen 3M’s Board of Directors and management, and further enhance the public trust 3M has earned from more than a century of operating with uncompromising integrity and doing business the right way. Governa... |
Risk oversight. |
The Board has delegated primary responsibility for the oversight of risks facing the company to the Audit Committee of the Board of Directors. The Audit Committee Charter states that the committee will “discuss policies and procedures with respect to risk assessment and risk management, the company’s major risk exposur... |
Enterprise risk Assessing and planning for risk at all levels. |
The Vice President and General Auditor, Corporate Auditing, whose appointment and performance is reviewed and evaluated by the Audit Committee, is responsible for leading the formal risk assessment and management process within the company. The General Auditor, consulting with the company’s senior management, annually ... |
While the Board’s oversight of risk is primarily performed by the Audit Committee, the Board has also delegated to other committees the oversight of risks within their areas of responsibility and expertise. We believe this governance of risks by Board committees, who share information with the full Board, is appropriat... |
Our actions. |
Corporate-level 3M’s Enterprise Risk Management (ERM) initiative, launched in 2001, has helped assure adequate recognition and ownership of the most significant potential risks to the company’s shareholder value, using a process that proactively identifies and communicates enterprise risks within the company. This incl... |
To assure longterm success, we are committed to discovering and preparing for all potential threats to our Vision. |
Risk owners familiar with the environmental, economic, and business aspects within the company are interviewed and requested to complete a thorough assessment for their respective risk(s). |
Together with subject-matter experts and senior management, the outcomes are mapped to demonstrate the relative level of risk and likelihood of risk. This “heat map” identifies the highest- risk areas and shows where to focus our internal efforts. In addition, external resources and data are continually reviewed to ass... |
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