Mandate and Responsibilities of the Board of Directors
A. Subject to the Articles of CRH Medical Corporation (the “Company”) and applicable law, the board of directors of the Company has a stewardship responsibility to:
- supervise the management of and to oversee the conduct of the business of the Company;
- provide leadership and direction to management;
- evaluate management;
- set policies appropriate for the business of the Company;
- approve corporate strategies and goals; and
- nominate directors.
B. The day to day management of the business and affairs of the Company is delegated by the board of directors to the chief executive officer. The board of directors will give direction and guidance through the chief executive officer to management and the chief executive officer will keep management informed of the board of director’s evaluation of the senior officers in achieving and complying with established goals and policies.
General Responsibilities and Composition; Committees
A. The board of directors shall:
- before each annual general meeting, recommend nominees to the shareholders for election as directors for the ensuing year;
- identify, review the qualifications of and approve candidates to fill vacancies on the board of directors between annual general meetings;
- appoint a corporate governance and nominating committee, an audit committee and a compensation committee and appoint the chair of each committee;
- establish the mandate, duties and responsibilities of each committee of the board of directors;
- elect a chair of the board and, when desirable, a vice-chair of the board, and establish their duties and responsibilities;
- appoint the chief executive officer of the Company, and establish the duties and responsibilities of the chief executive officer; and
- on the recommendation of the chief executive officer, appoint the senior officers of the Company and approve the senior management structure of the Company.
B. A majority of the board of directors must be independent in accordance with applicable provisions of National Instrument 58-101 – Disclosure of Corporate Governance Practices, the applicable rules of any exchange upon which securities of the Company are traded, or any other governmental or regulatory body exercising power or authority over the Company. The determination of independence of the directors will be publicly disclosed in accordance with applicable securities laws.
C. A principal responsibility of the chair of the board will be to manage, and act as the chief administrative officer of, the board of directors with such duties and responsibilities as the board of directors may establish from time to time. The chair of the board shall be independent of management.
D. The principal duties and responsibilities of the vice-chair will be as established by the board of directors from time to time. The vice-chair will be independent of management.
E. The board of directors shall meet not less than four times during each year and will endeavour to hold one meeting in each quarter. The board will also meet at any other time at the call of the chair of the board or, subject to the Articles of the Company, the chief executive officer or any director. The independent directors shall meet on a regular basis as required to fulfil their responsibilities, including at least annually in executive session without the presence of non-independent directors and management.
F. Each director must have an understanding of the Company’s principal operational and financial objectives, plans and strategies, and financial position and performance. Directors must have sufficient time to carry out their duties and not assume responsibilities that would materially interfere with, or be incompatible with, board membership. Directors who experience a significant change in their personal circumstances, including a change in their principal occupation, are expected to advise the chair of the corporate governance and nominating committee.
G. Directors may serve on the boards of other public companies so long as these commitments do not materially interfere and are compatible with their ability to fulfill their duties as a member of the board. Directors must advise the chair in advance of accepting an invitation to serve on the board of another public company.
A. The board of directors has the following specific duties and responsibilities:
- approve, supervise and provide guidance on the strategic planning process. The chief executive officer and senior management team will have direct responsibility for the ongoing strategic planning process and the establishment of long term goals for the Company, which are to be reviewed and approved not less than annually by the board of directors. The board of directors will provide guidance to the chief executive officer and senior management team on the Company’s ongoing strategic plan. Based on the reports from the chief executive officer, the board of directors will monitor the success of management in implementing the approved strategies and goals;
- identify the principal risks of the Company’s business and use reasonable steps to ensure the implementation of appropriate systems to manage these risks;
- use reasonable steps to ensure the Company has management of the highest calibre. This responsibility is carried out primarily through the appointment of the chief executive officer as the Company’s business leader. The board will assess, on an ongoing basis, the chief executive officer’s performance against criteria and objectives established by the board from time to time. The board of directors will also use reasonable steps to ensure that the chief executive officer has in place adequate programs to train, develop and assess the performance of senior management;
- keep in place adequate and effective succession plans for the chair of the board, the chief executive officer and senior management;
- place limits on management’s authority;
- to the extent feasible, satisfy itself as to the integrity of the chief executive officer and other executive officers of the Company and that the chief executive officer and other senior officers strive to create a culture of integrity throughout the Company.
- oversee the integrity of the Company’s internal control and management information systems;
- oversee the Company’s communications policy. The board of directors will monitor the policies and procedures that are in place to provide for effective communication by the Company with its shareholders and with the public generally, including effective means to enable shareholders to communicate with senior management and the board of directors. The board of directors will also monitor the policies and procedures that are in place to maintain a strong, cohesive and positive image of the Company with shareholders, the healthcare industry, governments and the public generally;
- require that the board of directors be kept informed of the Company’s activities and performance and take appropriate action to correct inadequate performance;
- approve and monitor all significant capital plans and establish priorities for the allocation of funds to ongoing operations and capital projects;
- provide for the independent functioning of the board. The board of directors will put in place appropriate procedures to enable the board to function independently of management at such times as is desirable or necessary through:
a. the institution of mechanisms to allow directors who are independent of management an opportunity to discuss issues in the absence of management; and
b. the engagement of outside advisers by directors at the Company’s expense subject to the approval of the corporate governance and nominating committee;
- adopt a formal code of business ethics that governs the behaviour of its directors, officers and employees. The board of directors must monitor compliance with the code of conduct and are responsible for granting any waivers;
- nominate directors;
- appoint members of the committees of the board of directors in accordance with the mandates of such committees; and
- as and when necessary, review and assess the adequacy of this Mandate to ensure compliance with any rules of regulations promulgated by any regulatory body and approve any modifications to this Mandate as considered advisable.
The duties and responsibilities set out above do not extend, and are not to be interpreted as extending, the obligations and liabilities of the directors beyond those imposed by applicable law and in each case are subject to the Articles of the Company and applicable law.
Adopted: December 6, 2018