Magna International Inc 6-K, filed Mar 31, 2023
Magna International Inc (MGA)
About this 6-K
Magna International Inc filed this 6-K on March 31, 2023.
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 6-K
Report of Foreign Private Issuer Pursuant to
Rule 13a-16 or 15d-16
under the Securities Exchange Act of 1934
For the month of March 2023
Commission File Number 001-11444
| MAGNA INTERNATIONAL INC. |
(Exact Name of Registrant as specified in its Charter)
|
| 337 Magna Drive, Aurora, Ontario, Canada L4G 7K1 |
| (Address of principal executive office) |
Indicate by check mark whether the registrant files or will file annual reports under cover Form 20-F or Form 40-F.
| Form 20-F ¨ | Form40-F x |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| MAGNA INTERNATIONAL INC. | ||
| (Registrant) | ||
| Date: March 31, 2023 | ||
| By: | /s/ “Bassem Shakeel” | |
| Bassem A. Shakeel, | ||
| Vice-President and Corporate Secretary | ||
EXHIBITS
Exhibit 99.1
MAGNA INTERNATIONAL INC.
BOARD CHARTER
Purpose
This Charter has been adopted by the Board of Directors to assist the Board in the exercise of its responsibilities. This Charter, together with the Corporate Constitution, the charters of the Board’s committees and the various policies, principles, procedures, codes and guidelines adopted by the Board and/or any Board committees from time to time, collectively comprise the Corporation’s overall corporate governance framework.
Where used in this Board Charter, the following terms have the following meanings:
“Act” means the Business Corporations Act (Ontario).
“Board Interlock” means a circumstance in which two directors of the Corporation serve together on the board of directors of another public company.
“Executive Management” means all appointed officers of the Corporation above the level of Vice-President.
“Independent Auditor” means the independent auditor nominated for the purpose of preparing or issuing an audit report or related work or performing other audit, review or attest services for the Corporation.
“Independent Director” means an individual who meets the independence standards specified under applicable law, currently being Section 1.4 of National Instrument 52-110 of the Canadian Securities Administrators.
Role and Responsibilities of the Board
| 1. | Stewardship Role: The Board is responsible for the overall stewardship of the Corporation. To this end, the Board: |
| ▪ | supervises the management of the business and affairs of the Corporation pursuant to the Act and other applicable law; and |
| ▪ | jointly with Executive Management, seeks to create long-term shareholder value. |
| 2. | Specific Responsibilities: In addition to the Board’s legal obligations under the Act and any requirements specified in the Corporation’s articles of incorporation and by-laws, the Board bears responsibility for the following: |
Corporate Culture and Governance
| a. | Oversight and Reinforcement of the Corporate Culture: The Corporation maintains a unique entrepreneurial corporate culture which seeks to encourage productivity, ingenuity and innovation and align the interests of employees, management and shareholders. This corporate culture includes a number of operating principles, including: |
| ▪ | functional and operational decentralization; |
| ▪ | fiscal discipline; |
| ▪ | employee equity participation and profit sharing; |
| ▪ | shareholder profit participation through dividends; |
| ▪ | incentive-based management compensation; |
| ▪ | a commitment to innovation through research and development; and |
| ▪ | support for charitable, cultural, educational, political and other social causes. |
The Board shall be responsible for overseeing and reinforcing the Corporation’s entrepreneurial corporate culture which has been essential to the Corporation’s long-term financial success, the creation of long-term shareholder value and its ability to attract, retain and motivate skilled, entrepreneurial employees at all levels.
| b. | Approach to Corporate Governance and Governance Guidelines: The Board shall oversee the development of the Corporation’s system of, and overall approach to, corporate governance. The Board has delegated to the Governance, Nominating and Sustainability Committee responsibility to review and make recommendations to the Board regarding corporate governance matters. |
Management Oversight
| c. | Selecting the Chief Executive Officer and Overseeing the Hiring of Other Members of Executive Management: The Board is responsible for selecting the Corporation’s Chief Executive Officer. In doing so, the Board shall consider a number of factors, including a candidate’s personal and professional integrity, reputation, achievements, experience, acumen/judgment, leadership qualities, knowledge and understanding of the Corporation’s business environment. Additionally, the Board shall provide oversight and advice with respect to the selection of other members of Executive Management. |
| d. | Satisfying itself as to the Integrity of Executive Management: The Board shall take such actions as it deems necessary to satisfy itself as to the: |
| ▪ | integrity of the Corporation’s Chief Executive Officer and other members of Executive Management; and |
| ▪ | creation and fostering by the Chief Executive Officer and other members of Executive Management of a culture of integrity and ethical business conduct throughout the Corporation. |
| e. | Overseeing Executive Compensation: The Board shall be responsible for ensuring that the Corporation’s system of executive compensation: |
| ▪ | is consistent with the Corporation’s entrepreneurial culture; and |
| ▪ | continues to meet the objectives of attracting, retaining and motivating skilled executives. |
The Board has delegated to the Talent Oversight and Compensation Committee responsibility for making recommendations to the Board with respect to the:
| ▪ | Corporation’s overall system of executive compensation; and |
| ▪ | application of such system to members of Executive Management, including with respect to the assessment of the performance of Executive Management and the determination of all direct, indirect and incentive compensation, benefits and perquisites (cash and non-cash) for members of Executive Management. |
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In addition, the Board shall provide shareholders with an annual advisory vote on the Corporation’s approach to executive compensation, substantially in the form of the following resolution:
“Resolved, on an advisory basis and not to diminish the role and responsibilities of the board of directors, that the shareholders accept the approach to executive compensation disclosed in the Corporation’s information circular delivered in advance of the [insert year] annual meeting of shareholders.”
In the event the annual advisory vote indicates significant opposition to the Corporation’s approach to executive compensation, the Board shall engage with shareholders to better understand the issues of concern and shall take such issues under advisement in determining the changes, if any, to be made to the Corporation’s system of executive compensation.
| f. | Leadership Development & Succession Planning: The Board shall be responsible for satisfying itself that the Corporation has developed and implemented effective succession plans identifying potential candidates for all positions within Executive Management, management of the Corporation’s Operating Groups and other key positions in the company. In fulfilling its responsibilities, the Board must satisfy itself that the Corporation’s leadership development and succession planning processes: |
| ▪ | have been structured to enable the Board to promptly address an unplanned succession event involving the Corporation’s Chief Executive Officer or other key members of Executive Management; and |
| ▪ | include robust and effective talent management practices to identify, reward, retain and promote high-performing employees. |
The Board has delegated to the Talent Oversight and Compensation Committee responsibility for reviewing such succession plans and making its recommendations to the Board.
The Board is also involved in management succession and planning through its review of executive officer appointments. In reviewing and appointing the Corporation’s executive officers, the Board shall satisfy itself as to each candidate’s personal and professional integrity, as well as skill and experience for the proposed office.
Corporate Strategy
| g. | Adoption of a Strategic Planning Process: In respect of each fiscal year, the Board shall: |
| ▪ | meet with applicable members of Executive Management and Operating Group management regarding strategic planning for the Corporation, including identification of future trends, opportunities and risks over a three to seven-year horizon; and |
| ▪ | consider and approve a business plan which addresses such trends, opportunities and risks. |
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Specific business plans and strategies at both the corporate and Operating Group levels shall be presented by Executive Management and Operating Group management for discussion with the Board. Capital expenditure projections for each fiscal year shall be reviewed and a budget presented for Board approval. Updates on industry trends, product strategies, new product developments, major new business, capital expenditures and specific problem areas/action plans shall be presented by management and discussed as required at regular quarterly Board meetings. The Board has delegated to the Technology Committee responsibility for reviewing and making its recommendations to the Board regarding the impact of technology trends on the Corporation’s business, operations and strategy.
Risk Oversight
| h. | Identification and Mitigation of Principal Risks: The Board shall satisfy itself that Executive Management maintains effective processes to identify and mitigate the principal business risks faced by the Corporation. The Board has delegated specific risk oversight responsibilities to each of the standing Committees, which shall periodically report to the Board in respect of such activities. |
| i. | Integrity of Internal Controls and Management Information Systems: The Board shall satisfy itself that effective systems are in place to monitor the integrity of the Corporation’s system of internal controls and its critical management information systems. The Board has delegated to the Audit Committee responsibility to review and monitor the effectiveness of such systems and to make its recommendations to the Board. |
| j. | Cybersecurity Risk: The Board has delegated specific cybersecurity risk oversight responsibilities to the Audit Committee (Domain 1 (Enterprise) and Domain 2 (Manufacturing)) as well as the Technology Committee (Domain 3 (Product)), and shall periodically review risk mitigation initiatives across all three cybersecurity domains to satisfy itself that effective systems and/or processes are in place to anticipate potential threats, as well as to detect and respond to breaches. |
Communication with Shareholders and Other Stakeholders
| k. | Shareholder Engagement: The Board recognizes the importance and value of regular, constructive engagement with the Corporation’s shareholders. The Board Chair shall act as the Board’s contact and Board spokesperson in connection with all meetings with shareholders and may be accompanied in such meetings by the Corporation’s most senior investor relations or financial officer or such other officer as may be appropriate to assist in ensuring that discussions do not extend to undisclosed material facts or changes. |
| l. | Communications Policy: The Board shall oversee the Corporation’s programs to effectively communicate with all of its stakeholders, including employees, as well as the general public. Such programs include without limitation: open quarterly webcast conference calls; the Corporation’s website; MagNet (intranet); and the Hotline. The Board shall also satisfy itself that the Corporation maintains appropriate policies regarding corporate disclosure. |
Fundamental Corporate Actions
| m. | Reviewing, Approving and Monitoring Fundamental Corporate Actions: In addition to those specific matters requiring prior Board approval under applicable laws, rules and regulations, or elsewhere in this Charter, the Board shall be responsible for: |
| ▪ | approving the following: |
| ▪ | the Corporation’s interim and annual financial statements, related Management’s Discussion and Analysis of Results of Operations and Financial Position, earnings press releases and other public disclosure documents of the Corporation containing financial information of the Corporation; |
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| ▪ | material public disclosures of the Corporation, including all management information circulars/proxy statements, annual information forms/40-Fs and material press releases; |
| ▪ | business plans and capital expenditure budgets; |
| ▪ | material financing activities, whether by way of debt or equity; |
| ▪ | major organizational restructurings (excluding internal reorganizations); |
| ▪ | material acquisitions and divestitures; and |
| ▪ | major corporate policies; and |
| ▪ | recommending the Independent Auditor to shareholders, based on the recommendation of the Audit Committee. |
Board Leadership and Structure
| 3. | Board Chair: The Independent Directors shall select from among themselves an Independent Director to act as Chair of the Board. The Board Chair shall preside as chair at all Board and shareholder meetings and carry out such specific duties as set forth in this Board Charter, the Corporation’s general by-law and as otherwise required by the Board from time to time. |
| 4. | Separation of Board Chair and Chief Executive Officer Roles: The positions of Board Chair and Chief Executive Officer of the Corporation shall not be occupied by the same person, except on an interim basis following the resignation or termination of a Chief Executive Officer. |
| 5. | Board Chair’s Duties: The duties of the Board Chair include: |
| ▪ | presiding as Chair of all Board and shareholder meetings; |
| ▪ | agenda setting for Board meetings; |
| ▪ | representing the Board in discussions with third parties, including shareholder engagement meetings and similar activities with other stakeholders; |
| ▪ | representing the Independent Directors in discussions with Executive Management; |
| ▪ | ensuring that the Board functions independently of management; |
| ▪ | together with the Chief Executive Officer, assisting in recruiting to the Board potential director candidates who have been identified and recommended by the Governance, Nominating and Sustainability Committee; |
| ▪ | overseeing the annual assessment of the effectiveness of the Board and each of its standing committees; and |
| ▪ | performing such other duties and responsibilities as are delegated by the Board from time to time. |
| 6. | Effect of Resignation by Chief Executive Officer: A person serving as both a director and Chief Executive Officer of the Corporation shall submit to the Board their resignation as a director upon their resignation or termination as the Chief Executive Officer. The Governance, Nominating and Sustainability Committee shall consider and make recommendations to the remaining members of the Board as to whether to accept such resignation and, if so, the appropriate effective date thereof to help achieve an orderly transition. |
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| 7. | Standing Committees: The Board shall have four standing committees: |
| ▪ | Audit Committee; |
| ▪ | Governance, Nominating and Sustainability Committee; |
| ▪ | Talent Oversight and Compensation Committee; and |
| ▪ | Technology Committee. |
The purpose, duties, responsibilities and composition of, and other matters relating to, each such committee shall be set forth in a committee charter approved by the Board and each standing committee shall act within and under the mandate set forth in its charter.
| 8. | Special Committees: From time to time, the Board may establish special committees to review and make recommendations on specific matters. Where appropriate, such special committees shall be composed entirely of Independent Directors of the Corporation. |
Board Independence and Effectiveness
| 9. | Size: The Board shall consist of such number of directors between five and fifteen as the Board deems appropriate in order to facilitate effective and efficient decision-making. The Board has delegated to the Governance, Nominating and Sustainability Committee the responsibility for considering and making recommendations to the Board with respect to Board size. Given the Corporation’s size, scope and complexity, as well as the need for a diversity of director views, it is expected that the Board will typically include at least nine directors. |
| 10. | Independence: At least two-thirds of the Corporation’s directors shall be Independent Directors. The Board shall annually determine the independence of each director, based on the recommendations of the Governance, Nominating and Sustainability Committee. |
If less than two-thirds of the Corporation’s directors are Independent Directors, including as a result of an Independent Director ceasing to be a director for any reason, the Board shall act promptly and in any event within 120 days use all reasonable efforts to restore the two-thirds independence ratio.
| 11. | Board Diversity Policy: The Board shall consist of directors who represent a diversity of knowledge, skills, experience, perspectives and backgrounds which will assist the Board in fulfilling its duties. In addition, the Board aspires to achieve gender parity by [December 31, 2023], subject to a minimum of not less than 30% female directors prior to that time. For purposes of this target, gender parity will be achieved if the balance between male and female directors ranges between 40% and 60%, assessed over a three-year timeframe. Beyond gender and diversity, the Board’s composition will generally be reflective of the Corporation’s customers, shareholders and employees, as well as the geographic markets in which it operates. |
| 12. | Individual Attributes: At a minimum, each director should possess the following attributes: |
| ▪ | personal and professional integrity; |
| ▪ | significant achievement in their field; |
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| ▪ | experience and expertise relevant to the Corporation’s business; |
| ▪ | a reputation for sound and mature business judgment; |
| ▪ | the commitment and ability to devote the necessary time and effort in order to conduct their duties effectively; and |
| ▪ | general ability to read and understand financial statements. |
| 13. | Director Recruitment, Tenure and Succession: The Governance, Nominating and Sustainability Committee shall oversee the Board’s succession practices and make recommendations to the Board regarding director recruitment, tenure and Board refreshment. |
In order to promote a diverse Board consistent with the policy in Section 11 of this Charter, the Governance, Nominating and Sustainability Committee shall establish recruitment procedures intended to elicit a diverse range of candidates, without discrimination on the basis of any diversity attributes, including age, gender, cultural background, national origin, religion, physical ability and sexual or gender orientation.
Decisions regarding continued service on the Board by an Independent Director shall be based primarily on the Board’s skills needs, the Independent Director’s performance, as determined through the Board’s annual effectiveness evaluation, as well as their continued independence. As a general rule, an Independent Director shall serve for a term of up to 12 years.
| 14. | Interlocks: In selecting candidates for nomination as directors of the Corporation, the Board has charged the Governance, Nominating and Sustainability Committee with the responsibility of managing Board Interlocks. The Governance, Nominating and Sustainability Committee shall not propose a slate of directors for election by shareholders if the election of those directors would result in more than two concurrent Board Interlocks. During the period between annual shareholder meetings, directors are required to advise the Chair of the Governance, Nominating and Sustainability Committee of their intention to join or be nominated for election to the Board of another public company in order to help ensure that the Board does not exceed two Board Interlocks. |
| 15. | Overboarding: In order to be able to devote the necessary time and effort to the activities of the Board and its committees, a director should not sit on a total of more than four public company boards without the prior approval of the Governance, Nominating and Sustainability Committee. A director who serves as a chief executive officer (or equivalent position) of a public company or similar commercial enterprise should not sit on more than one public company board in addition to the company of which he or she is a chief executive officer without the prior approval of the Governance, Nominating and Sustainability Committee. |
| 16. | Material Change in Director’s Status: Each director shall be required to notify the Chair of the Governance, Nominating and Sustainability Committee of any material change in their circumstances which could adversely impact the director’s ability to carry out their duties on the Board and any Committees. Such circumstances could include material changes to the director’s: |
| ▪ | health; |
| ▪ | qualification as an Independent Director; |
| ▪ | primary occupation; |
| ▪ | country of primary residence; and/or |
| ▪ | inability to meet the attendance requirement contained in this Charter. |
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| 17. | Access to Outside Advisors: The Board and its Committees may retain and compensate outside legal and other advisors at the expense of the Corporation where reasonably required to assist and advise the Board and Committees in carrying out their duties and responsibilities. |
| 18. | Prohibition on Loans to Directors and members of Executive Management: The Corporation shall not make personal loans or extensions of credit to directors of the Corporation or members of Executive Management. |
| 19. | Board and Chair Evaluation: The Board Chair, in conjunction with the Governance, Nominating and Sustainability Committee, is responsible for assisting in the annual evaluation of the effectiveness of the Board as a whole, the committees of the Board and individual directors. The Governance, Nominating and Sustainability Committee shall determine the most effective way to complete the evaluation in any particular year, including by: written questionnaire; interviews of Independent Directors by the Board Chair or Governance, Nominating and Sustainability Committee Chair; interviews of Independent Directors by a third party; or otherwise. Feedback from the annual evaluation shall be considered by the Governance, Nominating and Sustainability Committee and the Board in connection with the nomination of directors for election by shareholders. |
Majority Voting Policy
| 20. | Majority Voting: Any director nominee who is elected to the Board in an uncontested director election in circumstances where the number of votes withheld against such director exceeds the number of votes cast in their favour (“an Affected Director”) shall immediately tender their written resignation to the Chair of the Governance, Nominating and Sustainability Committee (with a copy to the Secretary of the Corporation) after the shareholder meeting at which the election occurred. Such resignation shall take effect upon acceptance in accordance with this Section 20. |
The Governance, Nominating and Sustainability Committee of the Board shall consider the Affected Director’s resignation. Absent exceptional circumstances, the Governance, Nominating and Sustainability Committee shall recommend and the Board shall accept the Affected Director’s resignation, effective no more than 90 days following the shareholder meeting at which the election occurred. The Corporation shall promptly disclose in a press release, a copy of which is provided to the Toronto Stock Exchange, the determination made by the Board, including, if applicable, the nature of the exceptional circumstances underlying a refusal to accept an Affected Director’s resignation.
An Affected Director will not participate in the recommendation of the Governance, Nominating and Sustainability Committee or the determination made by the Board. If a quorum of the Governance, Nominating and Sustainability Committee cannot be obtained due to the service on the Governance, Nominating and Sustainability Committee of one or more Affected Directors, the Board shall consider the resignation and make the determination.
Upon acceptance of an Affected Director’s resignation, the Board may (subject to applicable law):
| ▪ | leave the vacancy unfilled until the next annual meeting of the Corporation; |
| ▪ | fill the vacancy through the appointment of a new director (other than the Affected Director); or |
| ▪ | call a special meeting of shareholders at which a director nominee (other than the Affected Director) will be proposed for election by shareholders. |
For greater certainty, this majority voting policy does not apply in any case where the number of individuals nominated for election exceeds the number of directors to be elected, including as a result of a proxy contest.
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| 21. | Disclosure of Detailed Voting Results: Promptly after a shareholders’ meeting, the Corporation shall disclose in a press release the number and percentage of votes cast For and Withheld against any director, as well as those cast For and Against each other matter voted upon by shareholders. |
Director Orientation, Education and Access to Senior Employees
| 22. | Director Orientation: New Independent Directors shall be provided with a detailed overview of the Corporation’s business in order to assist them in contributing effectively to the Board. Management shall provide new Independent Directors with an orientation manual, the opportunity to meet with Executive Management and operational personnel and the opportunity to visit the Corporation’s manufacturing and other facilities. |
Additionally, the Board may undertake or arrange for continuing director education activities and programs on subjects that would assist directors in carrying out their duties. Individual directors are encouraged to participate in external director education activities at the Corporation’s expense and shall be reimbursed for their costs in doing so.
| 23. | Director Education: The Corporation shall offer directors a continuing director education program to assist them in furthering their understanding of the Corporation’s business and the automotive industry, directors’ duties and responsibilities and topical issues and emerging trends, including in such areas as corporate governance, risk management, development of human capital, executive compensation, ethics and compliance, mergers and acquisitions, as well as legal and regulatory matters. The educational priorities identified by the Board from time to time shall be addressed in the development of the director education program for any year. The Corporation’s director education program may include different elements, including: site visits to the Corporation’s facilities or those of its customers or suppliers; in-boardroom presentations by members of management or external advisors; attendance at third-party led training programs; membership in applicable organizations; and subscriptions to relevant periodicals or other educational resources. Additionally, Independent Directors are encouraged to participate in additional director education activities and the Corporation shall make available a reasonable budget from which directors’ expenses in connection with such activities can be funded. |
| 24. | Access to Senior Employees: Independent Directors are invited to contact senior employees of the Corporation, including the Corporation’s treasurer, senior accounting officer, controller, head of internal audit, senior tax officer, corporate secretary and others, without Executive Management present. |
Board Compensation and Director Equity Ownership
| 25. | Board Compensation: The Board shall approve appropriate compensation, benefits and perquisites for Independent Directors following a review by, and recommendations of, the Governance, Nominating and Sustainability Committee. In establishing such compensation, the Governance, Nominating and Sustainability Committee shall seek to achieve the following objectives: |
| ▪ | Independent Directors should be competitively compensated in relation to peer group companies of similar size, complexity, geographic scope and other relevant measures; |
| ▪ | the compensation system should align the interests of Independent Directors with those of the Corporation’s shareholders through one or more equity-based components; however, Independent Directors’ compensation shall not include stock options; |
| ▪ | the compensation system should appropriately recognize and compensate Independent Directors who serve as committee members and committee chairs; |
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| ▪ | appropriate recognition should be given to the significant contribution in time and effort required from the Board Chair; and |
| ▪ | generally, non-Independent Directors should not receive additional compensation for serving on the Board. |
The current schedule of retainers and fees payable to Independent Directors is attached as Schedule A to this Board Charter.
| 26. | Independent Director Share Maintenance Requirement: Independent Directors are required to own common shares and/or deferred share units (“DSUs”) of the Corporation representing five times the annual retainer payable to Independent Directors. Compliance with such share maintenance requirement shall be determined by dividing: |
| ▪ | five times the annual retainer; by |
| ▪ | the average of daily closing prices on The New York Stock Exchange of the Corporation’s common shares for the prior five calendar years, |
with the result obtained being the number of shares and/or DSUs required to be held.
New directors are entitled to a period of five years from the date first elected or appointed to the Board to accumulate the required number of shares or DSUs.
Board Meeting Administration
| 27. | Meetings: The Board shall hold at least five scheduled meetings each year, consisting of four quarterly meetings and one strategic planning and business plan review meeting. Other meetings shall be scheduled as required. The Independent Directors shall hold sessions without non-Independent Directors and other members of management present at each scheduled meeting. |
| 28. | Minimum Attendance: Each director of the Corporation is expected to use all reasonable efforts to attend a minimum of 75% of all regularly scheduled Board and applicable Committee meetings, except to the extent that any absence is due to medical or other valid reasons. |
| 29. | Meeting Agendas: The Board Chair and the Chief Executive Officer, shall establish a preliminary agenda for each Board meeting with the assistance of the Secretary of the Corporation. Any director may request items to be included on the agenda for any meeting. |
| 30. | Meeting Materials: To the extent reasonably practicable, meeting materials shall be distributed sufficiently in advance of Board meetings to permit directors to properly review and consider such materials. |
| 31. | Quorum: A majority of the members of the Board shall constitute a quorum and all actions of the Board shall be taken by a majority of the members present at the meeting. |
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Review and Revision of Charter
| 32. | Annual review: The Board shall annually review this Charter and revise it from time to time in such manner as the Board sees fit. The Board has delegated to the Governance, Nominating and Sustainability Committee the responsibility for recommending changes to this Board Charter. |
Board Approval Date: March 30, 2023
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SCHEDULE A
SCHEDULE OF RETAINERS AND FEES PAYABLE TO INDEPENDENT DIRECTORS
Amount ($) | |||
| Comprehensive Board Chair Annual Retainer | 500,000 | ||
| Comprehensive Committee Chair Annual Retainer | 300,000 | ||
| Comprehensive Director-at-Large Annual Retainer | 275,000 | ||
| Per Meeting Fee (applicable solely to meetings in excess of 25 meetings in aggregate) | 1,000 | ||
| Travel Time Fee (half day/full day) | 2,000/4,000 |
| Notes: |
| 1. | Special Committee Chair and Member Retainers to be set on Special Committee formation. |
| 2. | Minimum 60% DSUs until minimum equity maintenance requirement met; thereafter, minimum 40% DSUs. |
| 3. | Corresponding Equity Maintenance Requirements are as follows: |
Amount ($) | |||
| Board Chair | 1,500,000 | ||
| Committee Chair | 900,000 | ||
| Director-at-Large | 825,000 |
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Exhibit 99.2
MAGNA INTERNATIONAL INC.
AUDIT COMMITTEE CHARTER
Purpose
This Charter has been adopted by the Board of Directors of the Corporation (the “Board”) to assist the Audit Committee (the “Committee”) and the Board in the exercise of their responsibilities, particularly by defining the scope of the Committee’s authority in respect of financial and audit-related matters delegated to it by the Board.
Where used in this Charter, the term “Executive Management” has the meaning ascribed to it in the Corporation’s Board Charter.
Role and Responsibilities of the Committee
| 1. | The Board has delegated to the Committee the responsibility for the following matters: |
Independent Auditor
| (a) | Selection and Compensation of Independent Auditor: recommending to the Board: |
| ▪ | the independent auditor to be nominated for the purpose of preparing or issuing an audit report or related work or performing other audit, review or attest services for the Corporation (“Independent Auditor”); and |
| ▪ | the compensation of the Independent Auditor. |
| (b) | Oversight of Independent Auditor: overseeing the work of the Independent Auditor, which shall report directly to the Committee, including with respect to the resolution of disagreements between Executive Management and the Independent Auditor regarding financial reporting. |
| (c) | Pre-Approval of Audit Fees: pre-approving, or establishing procedures and policies for the pre-approval of, the engagement and compensation of the Independent Auditor in respect of the provision of all audit, audit-related, review or attest engagements required by applicable law. |
| (d) | Pre-Approval of Non-Audit Services: pre-approving all non-audit services permitted to be provided by the Independent Auditor in accordance with applicable law and rules governing the Independent Auditor, provided that the Committee may pre-approve certain fixed fee or time and materials services within designated thresholds on an annual basis and further provided that the Committee may delegate to the Committee Chair, or such other member or members of the Committee that it deems appropriate, certain pre-approval authority provided that any such approval granted by such persons shall be reported at the next regularly scheduled meeting of the Committee. |
| (e) | Audit Scope: reviewing and approving the objectives and general scope of the external audit (including the overall audit plan, the proposed timing and completion dates) and discussing the external audit with the Independent Auditor. |
| (f) | Independent Auditor’s Quality Control Procedures, Performance and Independence: evaluating the quality control procedures, performance and independence of the Independent Auditor in carrying out its responsibilities, including by obtaining and reviewing at least annually a report by the Independent Auditor describing: |
| ▪ | the firm’s internal quality-control procedures; |
| ▪ | any material issues raised by the most recent internal quality-control review, or peer review, of the firm, or by any inquiry or investigation by governmental or professional authorities, within the preceding five years, respecting one or more independent audits carried out by the firm, and any steps taken to deal with any such issues; and |
| ▪ | all relationships between the independent auditor and the Corporation. |
| (g) | Staffing of Audit Team: reviewing the experience and qualifications of the Independent Auditor’s audit team assigned to the audit of the Corporation and making annual recommendations to the Board as to the need (if any) for rotation of the Independent Auditor or the members of the Independent Auditor’s audit team assigned to the audit of the Corporation. |
| (h) | Required Disclosures: reviewing and discussing with the Independent Auditor all disclosures required by applicable accounting or other regulators to be reviewed with respect to the conduct of the audit and quarterly review of the interim financial results. |
| (i) | Relationship between Independent Auditor and Management: satisfying itself generally that there is a good working relationship between Executive Management and the Independent Auditor, and reviewing: |
| ▪ | any management representation letters; |
| ▪ | the Independent Auditor’s management letters and management’s responses thereto; |
| ▪ | the Independent Auditor’s schedule of unadjusted differences; and |
| ▪ | any other reports of the Independent Auditor, |
as well as discussing any material differences of opinion between management and the Independent Auditor.
| (j) | Hiring from Independent Auditor: reviewing and approving the hiring of partners, employees and former partners and employees of the present and any former Independent Auditor who were engaged on the Corporation’s account within the last three years prior to such hiring. |
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Internal Controls
| (k) | System of Internal Controls: satisfying itself that Executive Management has: |
| ▪ | established and is maintaining an adequate and effective system of internal control over financial reporting and information technology general controls (“ITGCs”), and |
| ▪ | is responding on a timely basis to any material weaknesses or significant deficiencies which have been identified, |
including by meeting with and reviewing reports of the Corporation’s Internal Audit Department (“IAD”) and the Independent Auditor relating to the Corporation’s internal controls and ITGCs.
| (l) | Reports on Internal Controls: annually reviewing: |
| ▪ | Executive Management’s report relating to the effectiveness of the Corporation’s disclosure controls and procedures, internal control over financial reporting, changes in internal controls over financial reporting and ITGCs; and |
| ▪ | the Independent Auditor’s report on internal controls under standards of the United States Public Company Accounting Oversight Board. |
Internal Audit
| (m) | Internal Audit Department: |
| ▪ | overseeing the appointment, termination and replacement of the senior management of IAD, the scope of the IAD’s work plan and budget, as well as the overall performance, staffing and resources of the IAD; |
| ▪ | receiving, reviewing and discussing with the senior management of IAD at least quarterly IAD’s reports relating to internal audit and other engagements, IT general controls testing, compliance investigations and other work carried out under IAD’s work plan; and |
| ▪ | reviewing and discussing with Executive Management its response to, and proposed actions to address, concerns raised by IAD. |
Accounting Matters
| (n) | Critical Accounting Policies: reviewing and discussing with the Independent Auditor: |
| ▪ | the selection, use and application of, as well as proposed material changes to, critical accounting policies, principles, practices and related judgments; and |
| ▪ | alternative GAAP treatments for policies and practices relating to material items, including the ramifications of such alternative disclosures or treatments and any recommended treatment, |
to satisfy itself that the critical accounting policies and practices and GAAP treatments adopted are appropriate and consistent with the Corporation's needs and applicable requirements.
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| (o) | Disagreements: satisfying itself that there is an agreed course of action leading to the resolution of significant unsettled issues between Executive Management and either the Independent Auditor or IAD that do not affect the audited financial statements (e.g. disagreements regarding correction of internal control weaknesses or the application of accounting principles to proposed transactions), if any. |
| (p) | Off-Balance Sheet Transactions: reviewing all material off-balance sheet transactions and the related accounting presentation and disclosure. |
Risk Oversight
| (q) | Financial Risk Oversight: assessing with Executive Management the Corporation's material risk exposures relating to financial and financial reporting matters and the Corporation's actions to identify, monitor and mitigate such exposures. |
| (r) | Litigation/Regulatory Actions Oversight: monitoring the status and potential impact of material litigation and regulatory proceedings. |
| (s) | Domain 1 and 2 Cybersecurity Risk Oversight: assessing with Executive Management the Corporation’s Domain 1 (enterprise) and Domain 2 (manufacturing) cybersecurity risk exposures, together with the Corporation’s actions to identify, monitor and mitigate such risks, and satisfying itself as to the effectiveness of such mitigation actions. |
Financial Disclosures
| (t) | Disclosure Controls: satisfying itself that procedures are in place for the review of the Corporation’s public disclosure of financial information extracted or derived from the Corporation’s financial statements and assessing the adequacy of those procedures annually. |
| (u) | Financial Reporting of Sustainability Matters: satisfying itself that procedures are in place to promote accurate reporting of sustainability-related financial impacts to the Corporation, and reviewing sustainability-related financial statement disclosures. |
| (v) | Approval of Disclosures: meeting to review and discuss the Corporation’s financial statements with Executive Management and the Independent Auditor and recommending to the Board prior to release, all such financial statements of the Corporation, together with related Management’s Discussion & Analysis of Results of Operations and Financial Position (“MD&A”), earnings press releases and all other public disclosure documents of the Corporation containing financial information of the Corporation. |
Financial Integrity and Whistle-Blowing
| (w) | Financial Integrity: reviewing and making recommendations to the Board with respect to: |
| ▪ | any actual or alleged illegal, improper or fraudulent behaviour related to the Corporation’s financial statements, or its accounting or auditing practices; and |
| ▪ | the findings of any regulatory authorities in relation to the financial affairs of the Corporation; |
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| (x) | Whistle-Blowing Procedures: overseeing the implementation, operation and effectiveness of the Corporation’s mechanisms for: |
| ▪ | the receipt, retention and treatment of complaints received by the Corporation regarding accounting, internal controls, auditing, as well as legal and regulatory compliance matters; and |
| ▪ | the confidential, anonymous submission of complaints by employees of the Corporation of concerns regarding questionable accounting, internal controls, auditing, or legal and regulatory compliance matters. |
Ethics and Legal Compliance
| (y) | Compliance Culture and Training: reviewing Executive Management’s implementation of systems and controls designed to promote compliance with applicable legal and regulatory requirements. In performing its oversight responsibilities, the Committee shall: |
| ▪ | satisfy itself that Executive Management has established an appropriate tone and culture with respect to: |
| ▪ | ethical business conduct by the Corporation’s employees, agents, representatives, contractors and suppliers; as well as |
| ▪ | legal and regulatory compliance; |
| ▪ | review with Executive Management the design, implementation and effectiveness of policies or programs that promote compliance with, legal and regulatory requirements; and |
| ▪ | periodically meet with representatives of the Corporation’s applicable functional departments and/or external advisors to discuss the Corporation’s compliance with applicable legal and regulatory requirements, the results of internal compliance reviews and material non-compliance with legal and/or regulatory requirements or internal policies, procedures and programs of the Corporation. |
| (z) | Code of Conduct: monitoring the implementation, operation and effectiveness of the Corporation’s Code of Conduct, periodically reviewing and recommending to the Board changes to such Code, authorizing any waiver of compliance of such Code and overseeing the investigation of any material alleged breach thereof. |
Reporting and Disclosure
| (aa) | Reporting to Board: quarterly reporting to the Board with respect to the Committee’s review of the Corporation’s financial statements, MD&A, financial disclosures, earnings press releases and related matters, and at least annually in respect of the Committee’s other activities. |
| (bb) | Audit Committee Report: overseeing the preparation of the Audit Committee report for inclusion in the Corporation's management information circular/proxy statement, in the form and at the time required by the laws, rules and regulations of applicable regulatory authorities. |
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Size, Composition and Independence
| 2. | Size: The Committee shall be composed of not less than three (3) nor more than five (5) members. The Board shall annually appoint the members of the Committee and a Chair from amongst those appointed, to hold office until the next annual meeting of shareholders of the Corporation. The members of the Committee shall serve at the pleasure of the Board and vacancies occurring from time to time shall be filled by the Corporate Governance, Compensation and Nominating Committee. Any member of the Committee may be removed or replaced at any time by the Board and shall automatically cease to be a member of the Committee upon ceasing to be a director of the Corporation. |
| 3. | Independence: All of the members of the Committee shall meet the independence standards specified under applicable law, currently being Sections 1.4 and 1.5 of National Instrument 52-110 of the Canadian Securities Administrators. |
| 4. | Financial Literacy and Expertise: All of the members of the Committee shall be “financially literate” as such term is defined in National Instrument 52-110 of the Canadian Securities Administrators and at least one member of the Committee shall have such accounting or financial expertise as is required to comply with applicable rules and regulations of the Ontario Securities Commission (“OSC”), the United States Securities and Exchange Commission (the “SEC”), The New York Stock Exchange (“NYSE”) and any other regulatory authority having jurisdiction. |
| 5. | Limit on Outside Audit Committees: No director shall serve as a member of the Committee if that director is a member of the audit committees of more than two other boards of directors of other public companies. |
| 6. | Independent Advisors: The Committee may retain and compensate such outside financial, legal and other advisors at the expense of the Corporation as it deems reasonably necessary to assist and advise the Committee in carrying out the Committee’s duties and responsibilities. |
| 7. | Role of Committee Chair: The Committee Chair shall generally provide leadership to enhance the effectiveness of the Committee and act as the liaison between the Committee and the Board as well as between the Committee and Executive Management. The Committee Chair shall also manage the Committee’s activities and meetings, manage any outside legal or other advisors retained by the Committee and manage the process of reporting to the Board on the Committee’s activities and related recommendations. |
| 8. | Secretary of the Committee: Unless otherwise determined or approved by the Committee, the Secretary or an Assistant Secretary of the Corporation shall act as the Secretary of the Committee. In the absence of the Secretary or an Assistant Secretary, the Committee shall select an individual to act as the Secretary of the Committee. The Secretary of the Committee shall keep minutes of the Committee and such minutes shall be retained in the corporate records of the Corporation. |
Committee Meeting Administration
| 9. | Meetings: The Committee shall hold at least four scheduled meetings each year, consisting of quarterly meetings held within the timeframes set forth in Section 10 of this Charter. Other meetings shall be scheduled as required. Regular meetings of the Committee shall be called by the Committee Chair, and additional meetings may be called by any member of the Committee, the Board Chair, Chief Executive Officer, Chief Financial Officer, Chief Legal Officer or the Secretary of the Corporation. At each quarterly meeting, the Committee shall meet separately with: the Independent Auditor and the head of IAD, in the absence of management; and management, in the absence of the Independent Auditor. At least annually, the Committee shall meet separately with the Corporation’s Vice President, Ethics and Legal Compliance without members of Management being present. |
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| 10. | Quarterly Meetings: the Committee shall meet with Executive Management and the Independent Auditor of the Corporation within: |
| (a) | forty-five (45) days, or such lesser period as may be prescribed by applicable law, following the end of each of the first three financial quarters of the Corporation, but in any event prior to the release of the financial results for each such quarter and their filing with the applicable regulatory authorities, to review and discuss the financial results of the Corporation for the preceding fiscal quarter and the related MD&A as well as the results of the Independent Auditor’s review of the financial results for such quarter and, if satisfied, report thereon to, and recommend their approval by, the Board and their inclusion in the Corporation's required regulatory filings for such quarter; and |
| (b) | sixty (60) days, or such lesser period as may be prescribed by applicable law, following the financial year-end of the Corporation, but in any event prior to the release of the financial results for the financial year and their filing with the applicable regulatory authorities, to review and discuss the audited financial statements of the Corporation for the preceding fiscal year and the related MD&A and, if satisfied, report thereon to, and recommend their approval by, the Board and the Corporation's shareholders as required by applicable law and their inclusion in the Corporation's Annual Report and other required regulatory filings. |
In reviewing the quarterly and annual financial results the Committee shall ensure that there are adequate procedures for review of such financial results, including timely review by the Independent Auditor.
| 11. | Minimum Attendance: Each member of the Committee is expected to use all reasonable efforts to attend a minimum of 75% of all regularly scheduled Committee meetings, except to the extent that any absence is due to medical or other valid reasons. |
| 12. | Notice of Meeting: Unless otherwise determined or approved by the Committee, the Secretary of the Committee shall provide notice of each meeting of the Committee to the following persons, all of whom shall be entitled to attend each Committee meeting: |
| ▪ | the Committee Chair and each member of the Committee; |
| ▪ | the Chief Executive Officer, the Chief Financial Officer, Chief Legal Officer of the Corporation, Senior Vice-President, Finance and the Controller; |
| ▪ | the Independent Auditor; |
| ▪ | the head of the IAD; |
| ▪ | the Chief Compliance Officer; and |
| ▪ | any other person whose attendance is deemed necessary or advisable by the Committee Chair. |
| 13. | Committee Access to Employees and Others: For the purpose of performing their duties and responsibilities, the members of the Committee shall have full access to and the right to discuss any matters relating to such duties with any or all of: |
| ▪ | any employee of the Corporation; |
| ▪ | the Independent Auditor; and/or |
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| ▪ | any advisors to the Corporation (including advisors retained by the Committee), |
as well as the right to inspect all applicable books, records and facilities of the Corporation and its subsidiaries and shall be permitted to discuss such books, records and facilities and any other matters within the Committee’s mandate with any of the foregoing.
| 14. | Meeting Agendas: The Committee Chair shall establish a preliminary agenda for each Committee meeting with the assistance of the Secretary of the Corporation. Any director or other person entitled to call a meeting may request items to be included on the agenda for any meeting. |
| 15. | Meeting Materials: To the extent reasonably practicable, meeting materials shall be distributed sufficiently in advance of Committee meetings to permit members to properly review and consider such materials. |
| 16. | Quorum: A majority of the members of the Committee shall constitute a quorum and all actions of the Committee shall be taken by a majority of the members present at the meeting. If the Committee only has two members as a result of a vacancy on the Committee, both members shall constitute a quorum. |
Delegation of Responsibility
| 17. | Right of Delegation: Subject to applicable law, the Committee may from time to time delegate one or more of its duties and responsibilities under this Charter to the Committee Chair, any other member of the Committee or any sub-committee of the Committee. |
Review and Revision of Charter
| 18. | Annual review: The Committee shall annually review this Charter and recommend to the Governance, Nominating and Sustainability Committee of the Board such changes as it deems advisable. |
Board Approved: March 30, 2023
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Exhibit 99.3
MAGNA INTERNATIONAL INC.
GOVERNANCE, NOMINATING AND SUSTAINABILITY COMMITTEE CHARTER
Purpose
This Charter has been adopted by the Board of Directors of the Corporation (the “Board”) to assist the Governance, Nominating and Sustainability Committee (the “Committee”) and the Board in the exercise of their responsibilities, particularly by defining the scope of the Committee’s authority in respect of corporate governance, nomination of candidates to serve as directors on the Board, sustainability oversight and certain other matters delegated to it by the Board.
Where used in this Charter, the term “Executive Management” has the meaning ascribed to it in the Corporation’s Board Charter.
Role and Responsibilities of the Committee
| 1. | The Board has delegated to the Committee the responsibility for the following matters: |
Corporate Governance
| (a) | General: making recommendations to the Board with respect to corporate governance of the Corporation as a whole, including without limitation: |
| ▪ | the stewardship role of the Board in respect of management of the Corporation; |
| ▪ | the Corporation’s corporate governance framework and guidelines; |
| ▪ | related party transactions, unless otherwise delegated by the Board to a special committee of the Board; and |
| ▪ | such processes and procedures as may be reasonably necessary to allow the Board to function independently of Executive Management. |
| (b) | Regulatory/Other Changes in Corporate Governance: monitoring and making recommendations to the Board with respect to regulatory or other applicable changes in corporate governance. |
| (c) | Board/Executive Management Relationship: monitoring, assessing and making recommendations to the Board with respect to the quality of the relationship between the Board and Executive Management, as well as the limits to Executive Management’s authority. |
| (d) | Board Effectiveness: annually overseeing the evaluation of the effectiveness of the Board and its Committees and making recommendations to the Board with respect to any changes which may be advisable to improve the functioning of the Board and/or any of its Committees. As part of the foregoing, the Committee may review the performance and contribution of Board and Committee Chairs in such capacities, as well as individual Board members. The Committee shall also oversee the implementation of recommended improvements. |
| (e) | Board/Committee Charters: annually reviewing the Board Charter, this Committee Charter and the charters of the Board’s other standing Committees, and making recommendations to the Board with respect to any amendments thereto which may be necessary or advisable. |
| (f) | Material Corporate Governance Policies: reviewing and making recommendations to the Board with respect to material corporate governance policies. |
| (g) | Voting of Shares Held by Deferred Profit Sharing Plans: directing the manner in which Common Shares of the Corporation held by the Corporation’s deferred profit sharing plans shall be voted on any matter to be voted on by shareholders; provided however that such shares shall be voted on the basis of the management, Board or Board Committee (as applicable) recommendations set forth in any applicable proxy circular in the absence of any direction to the contrary by the Committee. |
Nomination; Board and Committee Composition
| (h) | Board and Committee Succession Planning: overseeing succession planning for the Board and its Committees. |
| (i) | Board Size and Composition: regularly reviewing the diversity of skills, experience and other relevant attributes or characteristics represented by current Board members, and making recommendations to the Board regarding Board size and/or composition relative to the Corporation’s strategic needs and the Board’s diversity objectives. |
| (j) | Director Qualifications and Recruitment: developing and recommending to the Board qualifications for Board service, in line with the Board Diversity Policy and the individual attributes set forth in the Board Charter. Additionally, the Committee shall establish procedures to identify, interview and select potential Board members, and shall make such recommendations thereon to the Board as may be applicable. Among other things, the Committee shall annually recommend to the Board the proposed nominees for election at each of the Corporation’s annual shareholders’ meetings. |
| (k) | Determination of Independence: determining the independence of each candidate for Board service, including by annually determining the independence of each person nominated for election by shareholders, in accordance with applicable regulatory requirements. |
| (l) | Interlocks: establishing procedures to manage Board Interlocks in accordance with the guidelines set forth in the Board Charter. |
| (m) | Material Changes in Directors’ Status: reviewing any material changes in a director’s circumstances which could adversely impact the director’s ability to carry out their duties on the Board and any Committees. |
| (n) | Director Resignation under Majority Voting Policy: upon receipt of the resignation of a director under the Majority Voting Policy set forth in the Board Charter, promptly considering and making recommendations to the remaining members of the Board as to whether to accept such director’s resignation. |
| (o) | Board Vacancies: recommending to the Board whether to fill vacancies arising on the Board between shareholder meetings and, if so, recommending suitable candidates to fill such vacancies in accordance with the criteria and procedures developed pursuant to Section 1(j) of this Charter. |
| (p) | Committee Composition: annually recommending to the Board the allocation of Board members for appointment to each of the Board Committees based on the needs of the individual Committees. |
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| (q) | Committee Vacancies: appointing directors to fill vacancies arising from time to time in respect of any of the Board’s Committees. |
| (r) | Identification/Selection of Board and Committee Chairs: developing and recommending to the Board procedures to identify and select the Board Chair and Committee Chairs, as required from time to time. |
| (s) | Director Training and Education: overseeing the development, delivery and effectiveness of new director orientation and continuing education programs for members of the Board. |
Director Compensation and Equity Ownership
| (t) | Director Compensation: periodically reviewing and making recommendations to the Board with respect to the structure and quantum of compensation, as well as equity ownership requirements, for the Corporation’s directors. |
Sustainability and Environmental Compliance
| (u) | Sustainability and ESG: satisfying itself that the Corporation’s overall approach to sustainability and environmental, social and governance (ESG) factors is aligned with the Corporation’s strategy, stakeholder expectations, regulatory and voluntary frameworks, as well as market norms and best practices. |
| (v) | Environmental Compliance: satisfying itself regarding the effectiveness of the Corporation’s policies and programs to promote responsible environmental stewardship, including by: |
| ▪ | monitoring the Corporation’s compliance with applicable environmental laws in the jurisdictions in which the Corporation operates; and | |
| ▪ | receiving and reviewing the annual report from the Corporation’s Environmental Department regarding environmental audit/inspection performance. |
Enterprise Risk Oversight
| (w) | ERM Framework: periodically reviewing the Corporation’s overall approach to oversight and management of enterprise risks, and making recommendations to the Board as may be appropriate to enhance the Corporation’s approach to enterprise risk management. |
| (x) | Material Risk Exposures: annually assessing the Corporation’s material risk exposures, together with the efficacy of measures to mitigate same, and making recommendations to the Board as may be appropriate to enhance risk mitigation. |
Public Disclosure
| (y) | Oversight of Applicable Disclosure: annually overseeing the development of, and reviewing and making recommendations to the Board with respect to, applicable sections of the Corporation’s management information circular, annual information form, sustainability report and/or other public disclosure documents related to corporate governance, nomination of candidates to serve on the Board, directors’ compensation, sustainability, enterprise risk and any other matters delegated to the Committee pursuant to this Charter or otherwise. |
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Reporting to Board
| (z) | Reporting: reporting to the Board at least annually with respect to the Committee’s activities in respect of each fiscal year including the Corporation’s sustainability and ESG-related engagement efforts with shareholders and other key stakeholders including proxy advisory firms, non-governmental organizations (NGOs), key ESG ratings agencies and providers. |
Size, Composition and Independence
| 2. | Size: The Committee shall be composed of not less than three (3) nor more than five (5) members. The Board shall annually appoint the members of the Committee and a Chair from amongst those appointed, to hold office until the next annual meeting of shareholders of the Corporation. The members of the Committee shall serve at the pleasure of the Board and vacancies occurring from time to time shall be filled by the Board. Any member of the Committee may be removed or replaced at any time by the Board and shall automatically cease to be a member of the Committee upon ceasing to be a director of the Corporation. |
| 3. | Independence: All of the members of the Committee shall meet the independence standards specified under applicable law, currently being Section 1.4 of National Instrument 52-110 of the Canadian Securities Administrators. |
| 4. | Independent Advisors: The Committee may retain and compensate such outside legal and other advisors at the expense of the Corporation as it deems reasonably necessary to assist and advise the Committee in carrying out the Committee’s duties and responsibilities. |
| 5. | Role of Committee Chair: The Committee Chair shall generally provide leadership to enhance the effectiveness of the Committee and act as the liaison between the Committee and the Board as well as between the Committee and Executive Management. The Committee Chair shall also manage the Committee’s activities and meetings, manage any outside legal or other advisors retained by the Committee and manage the process of reporting to the Board on the Committee’s activities and related recommendations. |
| 6. | Secretary of the Committee: Unless otherwise determined or approved by the Committee, the Secretary or an Assistant Secretary of the Corporation shall act as the Secretary of the Committee. In the absence of the Secretary or an Assistant Secretary, the Committee shall select an individual to act as the Secretary of the Committee. The Secretary of the Committee shall keep minutes of Committee meetings and such minutes shall be retained in the corporate records of the Corporation. |
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Committee Meeting Administration
| 7. | Meetings: The Committee shall meet periodically as required in order to carry out its duties and responsibilities, but shall meet at least annually to address the matters specified in the following Sections of this Charter: |
| ▪ | 1(d) – Board Effectiveness; | |
| ▪ | 1(e) – Board/Committee Charters; | |
| ▪ | 1(k) – Determination of Independence; | |
| ▪ | 1(p) – Committee Composition; | |
| ▪ | 1(v) – Environmental Compliance; | |
| ▪ | 1(x) – Material Risk Exposures; | |
| ▪ | 1(y) – Oversight of Applicable Disclosure; | |
| ▪ | 1(z) – Reporting; and | |
| ▪ | 15 – Annual Review. |
| Meetings of the Committee may be called by the Committee Chair, any member of the Committee, Board Chair, Chief Executive Officer, Chief Financial Officer, Chief Legal Officer or the Secretary of the Corporation. The Committee shall generally hold sessions without members of management present at each scheduled meeting. |
| 8. | Minimum Attendance: Each member of the Committee is expected to use all reasonable efforts to attend a minimum of 75% of all regularly scheduled Committee meetings, except to the extent that any absence is due to medical or other valid reasons. |
| 9. | Notice of Meeting: Unless otherwise determined or approved by the Committee, the Secretary of the Committee shall provide notice of each meeting of the Committee to the following persons, all of whom shall be permitted to attend each Committee meeting: |
| ▪ | the Committee Chair and each member of the Committee; |
| ▪ | the Chief Executive Officer, the Chief Financial Officer and Chief Legal Officer of the Corporation; and, |
| ▪ | any other person whose attendance is deemed necessary or advisable by the Committee Chair. |
| 10. | Committee Access to Employees and Others: For the purpose of performing their duties and responsibilities, the members of the Committee shall have full access to and the right to discuss any matters relating to such duties with any or all of: |
| ▪ | any employee of the Corporation; and/or |
| ▪ | any advisors to the Corporation (including advisors retained by the Committee), |
as well as the right to inspect all applicable books and records of the Corporation and its subsidiaries and shall be permitted to discuss such books and records and any other matters within the Committee’s mandate with any of the foregoing.
| 11. | Meeting Agendas: The Committee Chair shall establish a preliminary agenda for each Committee meeting with the assistance of the Secretary of the Corporation. Any director or other person entitled to call a meeting may request items to be included on the agenda for any meeting. |
| 12. | Meeting Materials: Assess the relevance, timeliness and quality of material and information presented to the Board and recommend improvements where required. To the extent reasonably practicable, meeting materials shall be distributed sufficiently in advance of Committee meetings to permit members to properly review and consider such materials. |
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| 13. | Quorum: A majority of the members of the Committee shall constitute a quorum and all actions of the Committee shall be taken by a majority of the members present at the meeting. If the Committee only has two members as a result of a vacancy on the Committee, both members shall constitute a quorum. |
Delegation of Responsibility
| 14. | Right of Delegation: Subject to applicable law, the Committee may from time to time delegate one or more of its duties and responsibilities under this Charter to the Committee Chair, any other member of the Committee or any sub-committee of the Committee. |
Review and Revision of Charter
| 15. | Annual Review: The Committee shall annually review this Charter and recommend to the Board such changes as it deems advisable. |
Board Approved: June 30, 2022
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Exhibit 99.4
MAGNA INTERNATIONAL INC.
TALENT OVERSIGHT AND COMPENSATION COMMITTEE CHARTER
Purpose
This Charter has been adopted by the Board of Directors of the Corporation (the “Board”) to assist the Talent Oversight and Compensation Committee (the “Committee”) and the Board in the exercise of their responsibilities, particularly by defining the scope of the Committee’s authority in respect of its oversight of talent management, executive compensation and certain other matters delegated to it by the Board.
Where used in this Charter, the term “Executive Management” has the meaning ascribed to it in the Corporation’s Board Charter.
Role and Responsibilities of the Committee
| 1. | The Board has delegated to the Committee the responsibility for the following matters: |
Talent Management and Succession Planning
| (a) | Talent Management: overseeing the Corporation’s approach to talent management, including by satisfying itself as to the effectiveness of the Corporation’s strategies, initiatives and programs related to: |
| ▪ | employer branding; |
| ▪ | talent attraction, recruitment and retention; and |
| ▪ | employee training and development. |
| (b) | Enhancing Diversity: monitoring the effectiveness of programs aimed at advancing diversity within the Corporation’s workforce. |
| (c) | Leadership Development and Succession Planning: satisfying itself that the Corporation’s general approach to leadership development and succession planning for critical roles achieves the objectives set forth in the Board Charter, including by: |
| ▪ | managing such matters delegated to it by the Board from time to time with respect to succession planning for the Chief Executive Officer; |
| ▪ | monitoring succession plans for direct reports to the Chief Executive Officer; and |
| ▪ | reviewing initiatives aimed at providing development opportunities for high potential employees. |
Executive and Incentive Compensation
| (d) | Executive Compensation System: making recommendations to the Board with respect to the Corporation’s overall system of executive compensation and its alignment with the Corporation’s strategy, culture and values. |
| (e) | Chief Executive Officer’s Performance: developing and administering a process by which the Board can assess the Chief Executive Officer’s performance, including by: |
| ▪ | establishing performance goals and objectives in conjunction with the Chief Executive Officer; |
| ▪ | assessing the Chief Executive Officer’s performance against such goals and objectives, based on feedback from the Board; and |
| ▪ | making recommendations to the Board regarding the Chief Executive Officer’s compensation based on such assessment. |
| (f) | Compensation of Executive Management: determining and making recommendations to the Board with respect to all direct, indirect and incentive compensation, as well as benefits and perquisites (cash and non-cash) for members of Executive Management. |
| (g) | Equity Compensation Awards: reviewing and making recommendations to the Board regarding equity compensation awards proposed to be made pursuant to any of the following plans (collectively, the “Equity Compensation Plans”), including designating the employees to whom the awards are to be made, applicable grant values, as well as the terms and conditions applicable to each award: |
| ▪ | Amended and Restated 2009 Stock Option Plan; |
| ▪ | Performance Stock Unit Plan; |
| ▪ | 2022 Treasury Performance Stock Unit Plan; and |
| ▪ | any successor, replacement or additional plan pursuant to which Common Shares of the Corporation may be issued or purchased in the secondary market for executive compensation purchases. |
| (h) | Compensation Agreements: overseeing and approving the form of all employment, termination, equity grant and other compensation agreements between the Corporation and members of Executive Management. |
| (i) | Share Ownership: reviewing and recommending to the Board share ownership guidelines for members of Executive Management. |
| (j) | Executive Compensation Disclosure: annually overseeing the development of the Compensation & Performance Report, Compensation Discussion & Analysis and other elements of executive compensation disclosure for inclusion in the Corporation’s management information circular and/or other public disclosure documents of the Corporation. |
| (k) | Equity Compensation Plans: administering the Equity Compensation Plans and any successor or replacement plans thereto, together with all other plans involving the issuance of securities of the Corporation, including by reviewing and recommending to the Board all amendments to such plans. |
| (l) | Compensation Risk: assessing: |
| ▪ | whether the Corporation’s system of executive compensation encourages excessive risk-taking; and |
| ▪ | the effectiveness of elements of such system intended to mitigate such excessive risk, |
and making such recommendations to the Board as may be appropriate with respect to the foregoing.
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| (m) | Compensation Advisor: retaining and overseeing the work of an independent compensation advisor in connection with the compensation of Executive Management or the Corporation’s directors, including the sole authority for approving any such advisor’s fees, terms of engagement and performance. |
| (n) | “Say on Pay” and Shareholder Engagement: considering the results of the Corporation’s annual advisory shareholder resolution on executive compensation (“Say on Pay”), engaging with shareholders on the Corporation’s approach to executive compensation and making recommendations to the Board based on the foregoing. |
Pension Plans
| (o) | Administrator: acting as the administrator of the Corporation’s pension plan for purposes of applicable Canadian legislation and overseeing the management of the Corporation’s pension obligations. |
| (p) | Amendment and Termination: exercising the same powers as the Board with respect to the amendment and termination of any pension plan of the Corporation or any subsidiary. |
Employee Health & Safety
| (q) | Occupational Health & Safety Compliance: satisfying itself regarding the effectiveness of the Corporation’s policies and programs to promote occupational health and safety, including by: |
| ▪ | monitoring the Corporation’s compliance with applicable occupational health and safety laws in the jurisdictions in which the Corporation operates; and |
| ▪ | receiving and reviewing the annual report from the Corporation’s Health & Safety Department regarding health and safety audit/inspection performance. |
Risk Oversight
| (r) | Risk Oversight: assessing the Corporation’s material risk exposures relating to the responsibilities above, together with the Corporation’s actions to identify, monitor and mitigate such exposures. |
Reporting to Board
| (s) | Reporting: reporting to the Board at least annually with respect to the Committee’s activities in respect of each fiscal year. |
Size, Composition and Independence
| 2. | Size: The Committee shall be composed of not less than three (3) nor more than five (5) members. The Board shall annually appoint the members of the Committee and a Chair from amongst those appointed, to hold office until the next annual meeting of shareholders of the Corporation. The members of the Committee shall serve at the pleasure of the Board and vacancies occurring from time to time shall be filled by the Board. Any member of the Committee may be removed or replaced at any time by the Board and shall automatically cease to be a member of the Committee upon ceasing to be a director of the Corporation. |
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| 3. | Independence: All of the members of the Committee shall meet the independence standards specified under applicable law, currently being Section 1.4 of National Instrument 52-110 of the Canadian Securities Administrators. |
| 4. | Independent Advisors: The Committee may retain and compensate such outside compensation, legal and other advisors at the expense of the Corporation as it deems reasonably necessary to assist and advise the Committee in carrying out the Committee’s duties and responsibilities. |
| 5. | Role of Committee Chair: The Committee Chair shall generally provide leadership to enhance the effectiveness of the Committee and act as the liaison between the Committee and the Board as well as between the Committee and Executive Management. The Committee Chair shall also manage the Committee’s activities and meetings, manage any outside legal or other advisors retained by the Committee and manage the process of reporting to the Board on the Committee’s activities and related recommendations. |
| 6. | Secretary of the Committee: Unless otherwise determined or approved by the Committee, the Secretary or an Assistant Secretary of the Corporation shall act as the Secretary of the Committee. In the absence of the Secretary or an Assistant Secretary, the Committee shall select an individual to act as the Secretary of the Committee. The Secretary of the Committee shall keep minutes of Committee meetings and such minutes shall be retained in the corporate records of the Corporation. |
Committee Meeting Administration
| 7. | Meetings: The Committee shall meet periodically as required in order to carry out its duties and responsibilities but shall meet at least annually to address the matters specified in the following Sections of this Charter: |
| ▪ | 1(a) – Talent Management; | |
| ▪ | 1(c) – Leadership Development and Succession Planning; | |
| ▪ | 1(e) – Chief Executive Officer’s Performance; | |
| ▪ | 1(g) – Equity Compensation Awards; | |
| ▪ | 1(j) – Executive Compensation Disclosure; | |
| ▪ | 1(q) – Occupational Health & Safety Compliance; | |
| ▪ | 1(r) – Risk Oversight; | |
| ▪ | 1(s) – Reporting; and | |
| ▪ | 15 – Annual Review. | |
Meetings of the Committee may be called by the Committee Chair, any member of the Committee, Board Chair, Chief Executive Officer, Chief Financial Officer, Chief Legal Officer or the Secretary of the Corporation. The Committee shall generally hold sessions without members of management present at each scheduled meeting.
| 8. | Minimum Attendance: Each member of the Committee is expected to use all reasonable efforts to attend a minimum of 75% of all regularly scheduled Committee meetings, except to the extent that any absence is due to medical or other valid reasons. |
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| 9. | Notice of Meeting: Unless otherwise determined or approved by the Committee, the Secretary of the Committee shall provide notice of each meeting of the Committee to the following persons, all of whom shall be permitted to attend each Committee meeting: |
| ▪ | the Committee Chair and each member of the Committee; |
| ▪ | the Chief Executive Officer, the Chief Financial Officer and Chief Legal Officer of the Corporation; and |
| ▪ | any other person whose attendance is deemed necessary or advisable by the Committee Chair. |
| 10. | Committee Access to Employees and Others: For the purpose of performing their duties and responsibilities, the members of the Committee shall have full access to and the right to discuss any matters relating to such duties with any or all of: |
| ▪ | any employee of the Corporation; and/or |
| ▪ | any advisors to the Corporation (including advisors retained by the Committee), |
as well as the right to inspect all applicable books and records of the Corporation and its subsidiaries and shall be permitted to discuss such books and records and any other matters within the Committee’s mandate with any of the foregoing.
| 11. | Meeting Agendas: The Committee Chair shall establish a preliminary agenda for each Committee meeting with the assistance of the Secretary of the Corporation. Any director or other person entitled to call a meeting may request items to be included on the agenda for any meeting. |
| 12. | Meeting Materials: To the extent reasonably practicable, meeting materials shall be distributed sufficiently in advance of Committee meetings to permit members to properly review and consider such materials. |
| 13. | Quorum: A majority of the members of the Committee shall constitute a quorum and all actions of the Committee shall be taken by a majority of the members present at the meeting. If the Committee only has two members as a result of a vacancy on the Committee, both members shall constitute a quorum. |
Delegation of Responsibility
| 14. | Right of Delegation: Subject to applicable law, the Committee may from time to time delegate one or more of its duties and responsibilities under this Charter to the Committee Chair, any other member of the Committee or any sub-committee of the Committee. |
Review and Revision of Charter
| 15. | Annual Review: The Committee shall annually review this Charter and recommend to the Board such changes as it deems advisable. |
Board Approved: June 30, 2022
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Exhibit 99.5
MAGNA INTERNATIONAL INC.
TECHNOLOGY COMMITTEE CHARTER
Purpose
This Charter has been adopted by the Board of Directors of the Corporation (the “Board”) to assist the Technology Committee (the “Committee”) and the Board in the exercise of their responsibilities, particularly by defining the scope of the Committee’s authority in respect of matters delegated to it by the Board relating to technology and innovation.
Where used in this Charter, the term “Executive Management” has the meaning ascribed to it in the Corporation’s Board Charter.
Role and Responsibilities of the Committee
| 1. | The Board has delegated to the Committee the responsibility for the following matters: |
Technology Trends, Opportunities and Risks
| (a) | Technology Trends: reviewing, monitoring and evaluating general technological trends which may impact the automotive industry and/or the Corporation’s: |
| § | product, service and solution software offerings; |
| § | advanced manufacturing strategy; and/or |
| § | overall strategic plan, and |
addressing any recommended strategic actions with Executive Management.
| (b) | Opportunities and Risks: assessing the impact of technological trends and disruptive technological changes on the Corporation’s business or strategy and addressing with Executive Management the Corporation’s approach to realizing the opportunities and mitigating the risks arising from such trends and changes. |
Research & Development (“R&D”)
| (c) | R&D/Innovation: reviewing the Corporation’s R&D/innovation initiatives, assessing the effectiveness of such initiatives in relation to the Corporation’s strategy, and addressing with Executive Management its recommendations with respect to same. |
Technology Partnerships, Investments and Acquisitions
| (d) | Partnerships and Investments: providing input on the Corporation’s overall approach to: |
| § | technology partnerships, joint projects and other collaborative activities with universities, colleges, technical institutes, advanced research organizations or other similar bodies; |
| § | initiatives involving technology incubators; and |
| § | joint ventures with, or investments in, software and technology companies. |
| (e) | Technology M&A: providing input to Executive Management with respect to material M&A transactions aimed at addressing a technological trend, opportunity or gap in the Corporation’s product or service portfolio. |
Cybersecurity Risk
| (f) | Domain 3 Cybersecurity Risk Oversight: assessing with Executive Management the Corporation’s Domain 3 (product and solution software) cybersecurity risk exposures, together with the Corporation’s actions to identify, monitor and mitigate such exposures, and satisfying itself as to the effectiveness of such mitigation actions. |
Technology & Corporate Strategy
| (g) | Alignment Between Technology & Strategy: satisfying itself that the Corporation’s overall approach to technology and intellectual property development, management and acquisition are aligned with the Board’s strategic priorities. |
Reporting and Disclosure
| (h) | Reporting to Board: reporting to the Board as needed with respect to the Committee’s activities. |
| (i) | Technology Committee Report: overseeing the preparation of the Technology Committee report for inclusion in the Corporation’s management information circular/proxy statement. |
Size, Composition and Independence
| 2. | Size: The Committee shall be a committee of the full Board of the Corporation. The Board shall annually appoint the members of the Committee and a Chair from amongst those appointed, to hold office until the next annual meeting of shareholders of the Corporation. The members of the Committee shall serve at the pleasure of the Board and vacancies occurring from time to time shall be filled by the Board. Any member of the Committee may be removed or replaced at any time by the Board and shall automatically cease to be a member of the Committee upon ceasing to be a director of the Corporation. |
| 3. | Independence: A majority of the members of the Committee, including the Committee Chair, shall meet the independence standards specified under applicable law, currently being Section 1.4 of National Instrument 52-110 of the Canadian Securities Administrators. |
| 4. | Independent Advisors: The Committee may retain and compensate such outside advisors at the expense of the Corporation as it deems reasonably necessary to assist and advise the Committee in carrying out the Committee’s duties and responsibilities. |
| 5. | Role of Committee Chair: The Committee Chair shall generally provide leadership to enhance the effectiveness of the Committee and act as the liaison between the Committee and Executive Management. The Committee Chair shall also manage the Committee’s activities and meetings, manage any outside legal or other advisors retained by the Committee and manage the process of reporting to the Board on the Committee’s activities and related recommendations. |
| 6. | Secretary of the Committee: Unless otherwise determined or approved by the Committee, the Secretary or an Assistant Secretary of the Corporation shall act as the Secretary of the Committee. In the absence of the Secretary or an Assistant Secretary, the Committee shall select an individual to act as the Secretary of the Committee. The Secretary of the Committee shall keep minutes of the Committee and such minutes shall be retained in the corporate records of the Corporation. |
Committee Meeting Administration
| 7. | Meetings: The Committee shall meet periodically as required to carry out its duties and responsibilities, but shall meet at least annually to address the matters specified in Section 1 of this Charter. Meetings of the Committee may be called by the Committee Chair, Board Chair, Chief Executive Officer, Chief Financial Officer, Chief Legal Officer or the Secretary of the Corporation. The Committee shall generally hold sessions without members of management present at each scheduled meeting. | |
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| 8. | Minimum Attendance: Each member of the Committee is expected to use all reasonable efforts to attend a minimum of 75% of all regularly scheduled Committee meetings, except to the extent that any absence is due to medical or other valid reasons. |
| 9. | Notice of Meeting: Unless otherwise determined or approved by the Committee, the Secretary of the Committee shall provide notice of each meeting of the Committee to the following persons, all of whom shall be permitted to attend each Committee meeting: |
| ▪ | the Committee Chair and each member of the Committee; |
| ▪ | the Chief Executive Officer, the Chief Financial Officer and Chief Legal Officer of the Corporation; |
| ▪ | the Chief Technology Officer; |
| ▪ | any other person whose attendance is deemed necessary or advisable by the Committee Chair. |
| 10. | Committee Access to Employees and Others: For the purpose of performing their duties and responsibilities, the members of the Committee shall have full access to and the right to discuss matters relating to such duties with any: |
| ▪ | employee of the Corporation; and/or |
| ▪ | advisor to the Corporation (including any advisors retained by the Committee). |
The Committee shall also have the right to inspect all applicable books, records and facilities of the Corporation and its subsidiaries and shall be permitted to discuss such books, records and facilities and any other matters within the Committee’s mandate with any of the foregoing.
| 11. | Meeting Agendas: The Committee Chair shall establish a preliminary agenda for each Committee meeting with the assistance of the Secretary of the Corporation. Any director or other person entitled to call a meeting may request items to be included on the agenda for any meeting. |
| 12. | Meeting Materials: To the extent reasonably practicable, meeting materials shall be distributed sufficiently in advance of Committee meetings to permit members to properly review and consider such materials. |
| 13. | Quorum: A majority of the members of the Committee shall constitute a quorum and all actions of the Committee shall be taken by a majority of the members present at the meeting. |
Delegation of Responsibility
| 14. | Right of Delegation: Subject to applicable law, the Committee may from time to time delegate one or more of its duties and responsibilities under this Charter to the Committee Chair, any other member of the Committee or any sub-committee of the Committee. |
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Review and Revision of Charter
| 15. | Annual review: The Committee shall annually review this Charter and recommend to the Governance, Nominating and Sustainability Committee of the Board such changes as it deems advisable. |
Board Approved: March 30, 2023
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| CODE OF CONDUCT AND ETHICS 2022 Magna International 1 Code of Conduct And Ethics |
| CODE OF CONDUCT AND ETHICS 2022 Magna International 2 MESSAGE FROM CHIEF EXECUTIVE OFFICER Magna’s Code of Conduct and Ethics is embedded in our culture and supports our company’s purpose and core values. Our Code reflects our commitment as an organization and emphasizes the key principles that guide us to always act with integrity and do the right thing. To safeguard our reputation and contribute to Magna’s ongoing success, it is important for all of us to take the time to review, understand and live the values of our Code. Our Code is a roadmap we can follow everyday, that helps guide us to what is and isn’t acceptable when making decisions that affect Magna. In 2022, Ethisphere recognized Magna as one of the World’s Most Ethical Companies, an honor reserved for a select number of organizations with exceptional programs and a commitment to advancing business integrity. I am proud of our dedicated employees, who are committed to Magna and apply the highest ethical standards in everything they do. Our employees are the key to our success. Thank you for your continued dedication to Magna and your commitment to upholding our ethical values. Swamy Kotagiri Chief Executive Officer |
| CODE OF CONDUCT AND ETHICS 2022 Magna International 3 MESSAGE FROM CHIEF COMPLIANCE OFFICER Magna’s Code of Conduct and Ethics is our guidepost to ensure that all of us act with honesty and integrity in all of our business dealings. I received an email from a long-time Magna employee recently. He told me that he has always been a proud Magna employee, but it made him even prouder to know that the company he worked for was making ethics and integrity a key priority. I am also very proud of the great work our employees have done to ensure that they are following our Code of Conduct and Ethics and getting the answers they need. Sometimes those answers aren’t obvious or are in a “grey” zone. We’ve seen an increase in questions to our Regional Compliance Officers and more usage of our internally available compliance resources. We also see more employees using our Disclose It! system for disclosing conflicts of interest and gifts to government officials and Integrity Check, which enables us to confirm that third parties who represent Magna have reputations for ethical business practices. Employees have committed to be “Magna Upstanders” which asks us not to be bystanders by speaking up when we witness inappropriate behavior. We are in an extremely complicated business, which comes with challenging and nuanced ethics and compliance issues. Thank you for doing your part every day by acting with integrity and by speaking up. Your commitment drives our ongoing success – moving us in one direction. Forward. For All. Joanne Horibe Vice President, Ethics and Chief Compliance Officer |
| CODE OF CONDUCT AND ETHICS 2022 Magna International 4 Table of Contents MESSAGE FROM CEO....................................................................................................... 2 MESSAGE FROM CCO....................................................................................................... 3 INTRODUCTION................................................................................................................... 6 Vision l Mission l Values ................................................................................................... 8 RESPONSIBILITIES ............................................................................................................ 9 OUR CUSTOMERS/MARKET PLACE........................................................................... 11 Conducting Business with Integrity, Fairness and Respect............................. 11 Compliance with Antitrust and Competition Laws .............................................. 11 Compliance with Anti-Bribery Laws ........................................................................ 11 Lobbying and Political Participation........................................................................ 12 OUR SHAREHOLDERS / INVESTORS.......................................................................... 14 Financial Reporting ...................................................................................................... 14 Improper Securities Trading...................................................................................... 14 Public Disclosures........................................................................................................ 15 OUR EMPLOYEES............................................................................................................. 16 The Environment and Occupational Health and Safety...................................... 16 Protection of Personal Data....................................................................................... 16 Diversity and Inclusion................................................................................................ 17 Careful Communication .............................................................................................. 18 The Magna Hotline........................................................................................................ 18 Use of Confidential Information................................................................................ 20 Investments and Corporate Opportunities ............................................................ 20 Self-Dealing and Interacting with Relatives or Friends ...................................... 21 Outside Positions.......................................................................................................... 21 Gifts and Entertainment.............................................................................................. 21 ADDITIONAL RESOURCES ............................................................................................ 23 GLOSSARY......................................................................................................................... 24 |
| CODE OF CONDUCT AND ETHICS 2022 Magna International 5 INTRODUCTION It is important that we all understand our obligation to conduct business in a way that is both ethical and consistent with our corporate policies. Today, as the mobility landscape continues to become more complex and challenging, it is important that we all understand our obligation to conduct business in a way that is both ethical and consistent with our corporate policies. Our Code of Conduct and Ethics (the “Code”) acts as a guide to help us maintain our ethical standards. We expect and require every employee to act in accordance with applicable law and consistent with our core values and business principles. We also expect our suppliers, consultants, independent contractors, agents, and other representatives to meet these standards. Violations of this Code will lead to disciplinary action for employees, up to and including dismissal. This standard applies to how we: • treat one another in the workplace; • manage our environmental responsibilities; • engage with competitors; • interact with government officials; and • protect our confidential information as well as that of our customers. Each of us is responsible for acting with honesty and integrity and making the ethical choice all of the time. It is a key part of our job. Our Ethics & Legal Compliance team is committed to providing the necessary training and ongoing support to enable us to succeed in this area. Our Code applies to interactions in our shared professional lives, including daily office encounters, shared online spaces, social media, conferences, and other events where we represent Magna. This Code is provided as a resource to help guide us through our duties as Magna employees, and it offers topics for ensuring compliance with local and international laws. Q. I’m a Magna employee. Does this Code of Conduct and Ethics apply to me? A. Yes. The Code applies to all employees of Magna International Inc. (including full-time and part-time employees) and all of its operating groups, divisions, joint ventures and other operations globally. It also applies to all of our board directors and officers. Q. I’m a supplier to Magna. Does this Code apply to me? A. Anyone who acts on our behalf, such as suppliers, consultants, independent contractors, agents, and other representatives are required to meet the requirements in the Supplier Code of Conduct, which sets out standards that are similar to those found in this Code. |
| CODE OF CONDUCT AND ETHICS 2022 Magna International 6 Q. What are the consequences if I violate this Code? A. We are deeply committed to the values of this Code and will take seriously any failure to uphold these commitments. Violations of this Code will lead to disciplinary action. The type of discipline will depend on the severity of the breach and may include dismissal from employment in serious cases. The consequences are the same for our suppliers, consultants, independent contractors, agents or other representatives who fail to meet the ethical standards expected of our employees. If the breach is serious, we may terminate our relationship with the third party. We must also keep in mind that some sections of this Code reflect applicable legal requirements. This means that, in some cases, an action that breaches our Code may also violate the law. In these instances, the punishment can include fines or imprisonment. Please note that the questions and examples provided throughout this document are solely illustrative, do not describe actual events, and are not intended to capture all, or even the most serious, cases which may arise under our Code of Conduct and Ethics. |
| CODE OF CONDUCT AND ETHICS 2022 Magna International 7 Vision l Mission l Values Our Vision Advancing mobility for everyone and everything. Our Mission Our mission is to use our expertise to create a better world of mobility, responsibly. We do that by developing technologies, systems and concepts that make vehicles safer and cleaner for everyone. Core Values Guided by our Employee’s Charter, our core values are a reflection of who we are as individuals and as a company. Think Big Empowering each to act with confidence. Take Responsibility Taking accountability for ourselves and others in our actions and commitments. Never Settle Constantly innovating, improving and asking the right questions. Be Collaborative We do our best when we do it together, with respect and humility. |
| CODE OF CONDUCT AND ETHICS 2022 Magna International 8 RESPONSIBILITIES Life is full of choices, and we make many of them in the blink of an eye, every day. But some choices are much more important than others. And the choices we make as we represent Magna reflect on the company as a whole as well as ourselves. In short, our choices drive integrity. We have a Code of Conduct and Ethics to help guide us in making the best choices in the workplace. This Code applies to ALL Magna employees globally, including corporate and group offices, manufacturing divisions, and joint ventures. We expect all employees to read and understand our Code and to always act in an ethical and honest way. Making the right choices and following the laws and regulations that govern our business are critically important to our success, now and in the future. What We Can Do We are relying on all employees to help us drive integrity throughout the organization. We must: • Know our Code and related compliance policies • Speak up if we believe a possible violation of this Code has occurred or have a question about our Code • To live the basic principles that make up our Code, every day This is what we mean when we say: Know it. Speak it. Live it. Magna’s success depends on our people taking an active role and making sure all of us conduct business in an ethical way. Expectations of our Leaders As leaders of the company, our executives, senior officers, and managers are expected to set the highest ethical standard for themselves, in turn setting an example for their teams to follow. Our leaders are also expected to be diligent and alert regarding any potential violations of this Code and report concerns on a timely basis. Our leaders must also maintain an environment in which employees feel comfortable raising compliance concerns. This leadership by example is critical in establishing and maintaining the company-wide standards of behaviour outlined in this Code. Leaders also play a critical role in ensuring that there is no retaliation against any employee who reports concerns honestly and in good faith. This kind of retaliation is explicitly prohibited by our Policy on Anti-Retaliation. Retaliation can take many forms and can include subtle action. It can include reduced hours or pay, being dismissed, demoted, suspended, threatened, harassed, abused, embarrassed, humiliated, or |
| CODE OF CONDUCT AND ETHICS 2022 Magna International 9 denied opportunities (such as a promotion, wage increase, or overtime). For more information, please see our Policy on Anti-Retaliation. Q: I think my supervisor may be violating our Code, but I’m worried that reporting his behaviour may negatively affect my employment. Will Magna protect me if my supervisor finds out I reported his conduct? A: Yes. Our Policy on Anti-Retaliation prohibits supervisors from taking retaliatory action against employees and protects employees who report concerns honestly and in good faith. Q: Does the Policy on Anti-Retaliation apply if I am dismissed from my employment after reporting a concern in good faith? A: Yes, retaliation can take the form of dismissal. But it can also take other (including subtle) forms of action. Please see our Policy on Anti-Retaliation for more information. |
| CODE OF CONDUCT AND ETHICS 2022 Magna International 10 OUR CUSTOMERS/MARKET PLACE Conducting Business with Integrity, Fairness and Respect Our operating philosophy is that all of us, employees and management alike, share in the responsibility to ensure Magna’s success. To live up to this responsibility, we must all act with integrity. This means that we must obey the letter and spirit of laws that apply to us, uphold this Code, and honour our commitments. We must also be fair in our dealings with other employees, customers, suppliers and other stakeholders. It is also essential that we respect others who may have different thoughts and opinions, act with sensitivity and concern toward the cultures and customs of countries in which we operate and strive to consider our impact on the communities and environments where we conduct business. Compliance with Antitrust and Competition Laws We compete vigorously, but with respect for free and fair competition. As a result, we must comply with all applicable antitrust and competition laws. We will not engage in any activities that violate these laws such as agreeing with our competitors to fix prices, discounts, or terms of sale, limit production, divide markets, coordinate bidding activities, boycott customers or suppliers, fix employee compensation or agreeing not to hire each other’s employees. Our Policy on Antitrust and Competition provides a more complete explanation on how we uphold this commitment. Q: At Auto Shanghai, I ran into a former sales colleague who now works for a competitor. Over lunch, he asked if we could come up with a joint strategy to deal with a difficult new buyer. I told him I would get back to him. What should I have done? A: While having lunch with a former colleague is not a problem, any attempt to coordinate strategy with a competitor about a customer is strictly prohibited. In this situation, immediately end the conversation about strategy coordination and tell the former colleague not to discuss the topic. Then promptly inform Legal or Compliance. Compliance with Anti-Bribery Laws We do not offer or accept bribes or kickbacks, either directly or through third parties. In giving or accepting anything of value, we must think about whether doing so could influence a business decision or cause others to perceive such influence. We must also ensure that the records of all payments we |
| CODE OF CONDUCT AND ETHICS 2022 Magna International 11 make are always accurate and complete. These obligations apply in all cases but are especially strict in matters involving government officials. Our commitment to anti-bribery applies, without exception, to all of our operations, no matter what the local laws or cultural practices may be. We also expect third parties acting on our behalf to uphold this commitment. To find out more about our commitment to conducting business free of bribery, see our Policy on Bribery & Improper Payments. Q: In my country, it is common to give government workers a small payment (typically under $100) so that permits get issued more quickly. Am I allowed to make these payments under our Code and Policies? A: No. Our Code and Policy on Bribery & Improper Payments prohibit these payments, which are often referred to as “facilitation” (or “grease”) payments. Although these payments are legal and common in some countries, they are illegal in many others. Q: A government official who oversees our safety compliance gave me her nephew’s résumé and asked that I consider him for any positions that might be open in my department. I’ve reviewed the résumé and he has strong credentials. What should I do? A: Immediately let a supervisor, Legal, or Compliance know about this request. As a qualified applicant, he should be treated the same as other qualified applicants for the position. Requests like this need to be handled with care to ensure that we respect the law and our values while preserving our relationships. Lobbying and Political Participation Because laws governing lobbying and political contributions can be very complex and vary greatly across the locations where we do business, we need to approach our lobbying and political participation efforts, including funding and support, with great care. We must not engage in lobbying with any level of government or make political contributions (including monetary donations, goods, or services) on Magna’s behalf without written permission from a corporate office representative specifically authorized to handle these issues. For more information, contact a member of the Government Affairs team (visit the Government Affairs page on MagNET for more information), Legal, or Compliance. Q: We are having difficulty obtaining city approval for the building design of our new plant. I happen to know one of the city councilors well and would like to invite her to coffee to explain why she should support it. Can I do so? A: No. Since this type of meeting with an elected government official would be for the purpose of influencing public decision making, it is likely to constitute lobbying under local law. We should not engage in any act of lobbying without written permission from a corporate office representative specifically authorized to handle these issues. |
| CODE OF CONDUCT AND ETHICS 2022 Magna International 12 Our operating philosophy is that all of us, employees and management alike, share in the responsibility to ensure Magna’s success. To live up to this responsibility, we must all act with integrity. This means that we must obey the letter and spirit of the laws that apply to us, uphold this Code, and honour our commitments. |
| CODE OF CONDUCT AND ETHICS 2022 Magna International 13 OUR SHAREHOLDERS / INVESTORS Financial Reporting Magna’s credibility depends on the accuracy of our financial reports, and we must follow all applicable laws related to financial reporting. We must also be completely accurate in our financial entries. Our financial controls are designed to ensure the accuracy and timeliness of our reports. We will not tolerate anyone taking any step, or ordering someone else to take any step, to circumvent these controls through false or misleading entries. Doing so is a serious violation of our Code and could also be a criminal offense. Q: I work in accounting and recently received a number of large supplier invoices. My boss asked that I record them in the next quarter. She said that doing so would improve our financial results and help our share price. Should I follow her instructions? A: No. Inaccurate dating or delayed reporting of expenses would lead to overstated earnings this quarter and could affect our financial results. Failure to accurately record all financial information, even if it is done with the intention of helping Magna, is a violation of this Code and generally accepted accounting principles. If we are asked to do this, we should refuse. If we don’t feel comfortable or continue to be pressured, we must immediately report the situation to a financial officer at group or corporate office, Legal, or Compliance. We can also report the issue using the Magna Hotline. Improper Securities Trading We may sometimes gain access to confidential information about Magna, our suppliers, competitors, customers or business partners through their work. This inside information, if we use it for investment purposes, could give us an unfair advantage over other investors. Buying or selling securities, like stocks and bonds, based on inside information is illegal and the penalties can be severe. Therefore, if we have inside information about Magna or another company, we are prohibited from making investments in that company until that information becomes public and investors have had a chance to evaluate it. We are also not permitted to share inside information with co-workers or people outside Magna if they are not authorized to receive it. This prohibition extends to sharing inside information with relatives or friends. There are even more demanding requirements for our directors and officers and other designated individuals listed in the Insider Trading and Blackout Policy. These individuals are prohibited from buying or selling Magna securities during certain time periods. Our Insider Trading and Blackout Policy provides guidance on how to avoid insider trading and improper disclosure. |
| CODE OF CONDUCT AND ETHICS 2022 Magna International 14 Q: Based on internal reports, I know that our sales have increased significantly and that our profit this quarter will be higher than anticipated by industry analysts. Can I tell my sister to buy Magna stock before we publicly announce our quarterly earnings? A: No. Using inside information for the benefit of ourselves or others, including our family and friends, is contrary to our Code and illegal. Public Disclosures As a public company, we have a responsibility to provide full, accurate and timely information in our public documents. We take that responsibility very seriously and strive to follow all applicable laws related to disclosure of our business, operations, and financial conditions. To comply with these complex legal requirements, we have established a Corporate Disclosure Committee consisting of senior corporate management. Any employee authorized to speak to the media or shareholders, or to make public disclosures of any kind, must comply with applicable securities laws and our Policy on Corporate Disclosure. More details can be found in our Policy on Corporate Disclosure. |
| CODE OF CONDUCT AND ETHICS 2022 Magna International 15 OUR EMPLOYEES The diversity of our employees is a source of strength for our global company. We therefore value and respect people of different backgrounds, capabilities, and opinions. Environment and Occupational Health and Safety It is essential that we work in safe and clean environments. We seek to be an industry leader in occupational health and safety and environmental responsibility in all our operations and our supply chain. We are committed to complying, and ensuring that our suppliers comply, – with, all health, safety and environmental laws and regulations that apply to us by ensuring that a systematic review program is implemented and monitored at all times for each operation. Our commitment to health, safety and the environment is explained in our Employee’s Charter and our Operational Principles and explained in greater detail in our Health, Safety & Environmental Policy. Protection of Personal Data We respect the privacy of our employees and are committed to protecting their personal data. We process personal data lawfully, transparently and fairly. We will also take reasonable steps to protect the integrity and confidentiality of personal data. Q: I work in the Human Resources department. A marketing company recently asked me for the home addresses of all of our employees so that they can send out some valuable information about a new medical clinic. Even though the employees would probably benefit from the information, I turned the marketing company down. Did I do the right thing? A: Yes. Our home addresses are private and should only be disclosed for legitimate business and employment reasons, or if required by law. In this case, marketing a service to employees is not an acceptable reason for revealing this personal data. Doing so would violate our Code and may be illegal under local privacy laws. Respect for Human Rights Respect for the human rights of employees and other stakeholders is central to our Fair Enterprise philosophy. We are committed to complying with all human rights laws and regulations that apply to us. Consistent with our Employee’s Charter, we believe in fair and equitable treatment. We have well established harassment and discrimination policies that help ensure a respectful workplace environment |
| CODE OF CONDUCT AND ETHICS 2022 Magna International 16 for all, and complaint and investigation procedures to help remedy improper conduct. Our local policies celebrate diversity, promote tolerance of individual practices and beliefs, and accommodate those in need of assistance, based on all legally protected grounds. We also have policies that prohibit workplace violence and bullying. We provide fair working conditions for our employees and do not tolerate the use of slavery, child or forced labour in our organization or supply chain. Our Global Labour Standards recognize the UN Universal Declaration of Human Rights, the 8 Fundamental Conventions of the International Labour Organization (ILO), and the ILO Declaration on Fundamental Principles and Rights of Work. Together with national legislative requirements, we recognize the right of our employees to work and associate freely under fair conditions in a safe and respectful environment, where we strive to meet or exceed applicable employment standards requirements. Also consistent with our Employee’s Charter is our commitment to non-discriminatory compensation practices that fairly compensate employees having regard to objective criteria and principles of internal equity as well as external competitiveness, regardless of personal characteristics. We expect any supplier or other company we work with to comply with applicable laws. Q: I suspect that one of our suppliers may be using underage workers. What should I do? A: Promptly report it to a supervisor, Legal, Compliance, or Purchasing. Q: I’m considering promoting someone in our Troy, Michigan office to a role interfacing with our North American suppliers. While she has all the required qualifications, I’m worried that some of our suppliers might be uncomfortable with her disability. Is this a legitimate reason to give someone else the promotion? A: No. We strive to provide equal advancement opportunity to everyone without discrimination on legally protected grounds such as disability. If she has the right qualifications for the job, and can perform the essential job duties, we must not deny her the promotion based on her disability. Diversity and Inclusion Our employees are critical stakeholders in our global company. We aim to attract, recruit, and retain talent with diverse backgrounds, perspectives and capabilities. Deeply rooted in our Employee’s Charter, we aim to create a safe, respectful and inclusive workplace where our employees can bring their whole selves to work, live our core values, achieve sustainable results and improve our global brand. We abide by all applicable labour and employment laws, including those prohibiting discrimination and harassment and those providing for reasonable accommodation of differences. We are committed to providing equal employment and career advancement opportunities to everyone, without discrimination based on, but not limited to, age, race, religion, ethnicity, colour, physical features, sex, sexual orientation, gender identity/expression, language differences, nationality or national origin, family or marital status, physical, mental and development abilities, socioeconomic status, or any other personal characteristic protected by law. |
| CODE OF CONDUCT AND ETHICS 2022 Magna International 17 Careful Communication We must ensure that what we write and say while on the job, and outside of work, reflects the integrity and standards expected of us. To protect Magna’s reputation and our own, it is important that all of our written communications be prepared with care and with the understanding that they could one day be made public. While we enjoy freedom of speech and all legal entitlements to communicate, we must also be careful not to post anything to social media that defames the company, disparages suppliers or customers, reveals confidential information or violates Magna’s copyright and patent rights. Additionally, if someone such as a news media reporter, an industry professional or a shareholder asks us to discuss or comment on matters related to Magna, we must refrain from commenting and refer them to an authorized Magna spokesperson. Our Policy on Careful Communication, our Global Email, Internet and Social Media Policy and our External Media Communications Policy are all useful resources for questions concerning communication. Q: I occasionally air out my frustrations with one of our suppliers on my Facebook page, where I have 250 friends. I do this on my own time and my settings are private so that only my friends and family can see these updates. Is that okay? A: No. Postings on social media do not always remain private. We must refrain from disparaging our suppliers in any public forum. If this concern about our supplier relates to violations of this Code, report it to a supervisor, Legal, Compliance, or through the Magna Hotline. Other concerns are best addressed by using Magna’s Open Door Process. Q: I found some inaccurate information about our recent financial results in a newspaper article posted online. I would like to leave a comment on the newspaper’s website with the correct information. Should I do so? A: No. Promptly inform someone in Corporate Communications or Investor Relations about the inaccurate information. If we post about our business, we are acting as unauthorized spokespersons for the company. The Magna Hotline If we become aware of a violation of this Code, or any related policies, we can speak to a supervisor, Legal, or Compliance. We can also report the incident through the Magna Hotline online at www.magnahotline.com, or we can use that website to look up local, toll-free phone numbers for each country in which we operate. This service is provided through an independent third party and is available 24 hours a day, 365 days a year. We can make our reports anonymously (unless prohibited by local law). Please provide sufficient details so the concern can be investigated effectively. |
| CODE OF CONDUCT AND ETHICS 2022 Magna International 18 Q: What happens when I report a violation using the Magna Hotline? A: All reports received through the Magna Hotline, are initially reviewed by our Magna Hotline Administrators, who will consider whether an investigation is needed and who should lead it. For more information about our investigation practices, please refer to our Policy on Ethics Investigations. |
| CODE OF CONDUCT AND ETHICS 2022 Magna International 19 OUR BUSINESS Use of Confidential Information Like any other asset, confidential information, which includes trade secrets, proprietary information and intellectual property belonging to us, our customers or suppliers, is a valuable part of our business and we are obligated to safeguard it. Our Information Marking and Handling Policy sets out different levels of confidentiality, each with its own rules on how such different levels of information may be stored, copied, circulated, transmitted and destroyed. Confidential information should not be shared with anyone outside Magna unless it is required by law or for an authorized business purpose and should only be shared internally on a “need to know” basis. Q: What can I do to protect our confidential information? A: There are many steps we can take to protect confidential information. We should treat confidential records and information with great care and not leave our electronic devices unattended, especially during travel or business events. We should also avoid discussing Magna business in public areas, such as on a crowded elevator or airplane. We must also familiarize ourselves with our information governance policies and guidelines available on MagNET .. Investments and Corporate Opportunities We must avoid situations where our personal interests come into conflict with Magna’s interests, or situations which give that impression. For example, if we discover business opportunities because of our employment, or through the use of Magna’s property or information, we must not take personal advantage of these opportunities. We must also refrain from using Magna resources for personal gain. We must also never be involved in any activity that puts us in competition with Magna. Q: I work in engineering and during the course of my work. I have come up with a new transmission design that I think could be of interest to a few of our automotive customers. Since I came up with the design, can I market it directly to them? A: No, doing so would violate our Code. Any intellectual property we create as part of our jobs belongs to Magna. In addition, any design developed during the course of our employment at Magna, and using company resources, provides Magna with a valuable business opportunity. We must not take personal advantage of these situations without seeking Magna’s approval. Q: I am overseeing the opening of a new division and am choosing between two countries where it will be located. One of the countries will offer a personal tax break to senior employees (including myself) if we open our division there. What should I do? A: This eligibility for a personal tax break gives rise to a conflict of interest. We should not make decisions for Magna that could result in personal benefit. Before making any decision on where to open the division, |
| CODE OF CONDUCT AND ETHICS 2022 Magna International 20 disclose this conflict in accordance with our Policy on Conflicts of Interest, and await further directions from management. Self-Dealing and Interacting with Relatives or Friends Our personal interests and relationships should not interfere with our work responsibilities. Therefore, it is inappropriate for anyone to supervise relatives or close friends, be in a direct reporting relationship with them, or materially influence their performance evaluation or compensation. It is also not appropriate to be in a position to hire, evaluate, provide funding to, or enter into contracts or other business relationships with a relative or close friend or a business or organization in which either we or our relatives or close friends have a significant interest. Specifically, if our work decisions may be affected, or appear to be affected, by the position or interests of our relative or close friend, or by any significant interest that we or our relatives or close friends have in another business or organization, we must disclose these situations in accordance with our Policy on Conflicts of Interest. We must also comply with any measures that may be put in place to ensure all such dealings and decisions are made on a fair and transparent basis. Q: I’m a buyer in the purchasing department. My wife was recently hired as the head of sales for one of our suppliers. Is this a conflict of interest? A: Yes. Your wife’s new role could affect your business judgment or give others that impression. This conflict should be disclosed in accordance with our Policy on Conflicts of Interest. That way, management can assess the situation and take appropriate measures to manage the conflict. Doing so helps Magna and protects you and your wife from any allegation of improper conduct. Outside Positions To help Magna succeed, we must devote our full time and attention to our jobs during working hours. Therefore, we may not accept outside commitments that would reduce the time and attention we can devote to our jobs at Magna. Unless it has been disclosed in accordance with our Policy on Conflicts of Interest and necessary authorizations have been obtained, we are prohibited from accepting paid or unpaid positions that might pose a conflict of interest with Magna or give the impression of such a conflict. Gifts and Entertainment Our relationship with all of our business partners must be based on integrity and sound business judgment. As a result, if we give or receive gifts or entertainment (which could be anything of value), we must be careful not to compromise, or appear to compromise, our commitment to fair dealing and to making decisions that benefit Magna. In our business relationships with customers or suppliers, it is acceptable to give or receive business gifts or entertainment as long as they are reasonable, occasional, and of modest value. Any gift or entertainment |
| CODE OF CONDUCT AND ETHICS 2022 Magna International 21 that we provide must also be recorded accurately and transparently in our expense reports and Magna’s books and records. Because of increased legal risks, we must all take special care when dealing with government officials. Offering gifts or entertainment to government officials requires written approval. More information about the necessary approvals, as well as additional information about gifts and entertainment, can be found in our Policy on Gifts & Entertainment. Q: One of our suppliers has offered airfare and accommodations to see my favourite team play in the championship. Is that okay? A: No. Our business decisions must always be motivated solely by Magna’s best interests. Accepting this extravagant gift could give the impression that we favour that supplier in future sourcing decisions. We may only accept business gifts and entertainment that are reasonable, occasional, and modest in value. When in doubt, check with Legal or Compliance. Q: A government auditor who has conducted environmental audits at my division several times over the years is having a child next month. I would like to give him a bottle of whiskey as a present. Would that be permitted? A: Giving a gift or entertainment to a government official requires extra caution and pre-approval in accordance with our Policy on Gifts & Entertainment. For more information, consult with Legal or Compliance. |
| CODE OF CONDUCT AND ETHICS 2022 Magna International 22 ADDITIONAL RESOURCES If we have any questions or need more information about our Code of Conduct and Ethics, we can contact Legal or a member of Magna’s Ethics & Legal Compliance team. A list of Compliance team members can be found on magna.com or the Ethics & Legal Compliance page on MagNET. |
| CODE OF CONDUCT AND ETHICS 2022 Magna International 23 GLOSSARY Anything of value: This can take the form, among many other things, of cash (or cash equivalents, like gift cards), gifts, donations to charity, meals, travel expenses, event tickets or other entertainment, educational expenses, discounts, favours, promises of future employment, or shares of a company. Bribe: A type of improper payment. A bribe is anything of value given or offered to someone for their personal benefit that may be seen as an attempt to influence an action or decision to be made (or not made) on behalf of the organization they represent, to benefit or give advantage to Magna. Compliance: Following the letter and spirit of the law, this Code, and all of our policies. Conflict of Interest: In general, a conflict of interest refers to a situation where we are able to make or influence a business decision for Magna while our personal interests (or the interests of a person you’re related to or have a personal relationship) differ from those of Magna. Facilitation (or “Grease”) Payments: A form of bribe, typically made to low-level government officials to obtain routine services or determinations to which Magna would otherwise be legally entitled. Good faith: With an honest and sincere intention. Government Official: An officer or employee of a government, department or agency, any public international agency, or any person acting in any official capacity on behalf of the government, department or public international agency, as well as any other person deemed to be a government official by our procedures. Inside information: Information not known by investors or the public that, if it was known, would significantly change their view regarding the value of a company, or its stock or bonds. Examples include a significant acquisition or merger, changes in senior management, significant litigation or labour disputes. Kickback: A form of bribe in which a sum of money already paid or due to be paid is returned as a personal reward for making or fostering a business arrangement. Lobbying: Communications with government officials at any level of government, including individuals elected to public office, staff and employees of government agencies, intended to promote, oppose or otherwise influence decision-making. Personal data: Information relating to an identified or identifiable individual. An individual may be identifiable if they can be identified, directly or indirectly, by reference to (i) an identifier such as their name, ID number, or location data, or (ii) factors which express physical, social, or financial details about them. Processing personal data: Any operation(s) performed with personal data, including collecting, recording, organizing, structuring, storing, altering, using, disclosing, erasing, or destroying personal data. Relatives or close friends: Includes a spouse, domestic partner, child, parent, grandparent, grandchild, sibling, aunt, uncle, niece, nephew, in-law relative, step/adoptive/foster relationships, an individual related to us who resides in our homes, and friends with whom we socialize outside of work. |
| CODE OF CONDUCT AND ETHICS 2022 Magna International 24 Significant interest: A person holds a significant interest in a business if he (i) directly or indirectly controls ten percent (10%) or more of the stock, assets or other interests of a business; (ii) has invested ten percent (10%) or more of his net worth in the business; (iii) has a leadership role in the business; or (iv) would benefit directly from the business relationship with Magna. Third Party: A person, organization, or business operating external to Magna. Originally Enacted: May 1, 2016 Current Version: May 1, 2022 Next Review: Q2 2025 Issued by: Ethics and Legal Compliance Approved by: Board of Directors |
| CODE OF CONDUCT AND ETHICS 2022 Magna International 25 Magna International Inc. 337 Magna Drive Aurora, Ontario Canada L4G 7K1 Telephone: (905) 726-2462 CONNECT WITH MAGNA magna.com |
