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TD.comAnnual Report 2012 › Chair's message

Chairman of the Board’s Message

During a year of slow economic growth, TD Bank Group achieved strong financial results, increased its dividend twice and maintained a sound capital position. TD’s performance is a reflection of the bank’s proven business strategy and the leadership team’s commitment to deliver value to all our stakeholders.

Corporate governance

Strong corporate governance is essential to any organization’s ability to achieve sustainable growth and deliver shareholder value. In 2012, TD was recognized in this regard with IR Magazine’s “Best Corporate Governance” award.

TD’s board provides ongoing strategic counsel to the senior executive team, evolving our practices to meet the needs of our business environment and continuing to ensure TD’s decisions align with its conservative risk appetite. One of the most critical responsibilities of the board is to ensure that TD has effective talent recruitment, development and succession planning policies and practices. Recognizing that the next CEO transition falls within the planning horizon, the board has increased its strong focus on succession planning at the most senior levels of the bank. Our objective is to ensure clarity in the roles and responsibilities of the entire senior management team, to preserve the vital asset that the team represents and to avoid the loss of institutional momentum that can attend such transitions. We believe that we are well positioned in this regard.

photo of Brian Levitt

“TD employs a remarkable team of people who care about their businesses, customers and communities, and who continue to make TD The Better Bank”

Board composition

In 2012, we were pleased to welcome Colleen Goggins of Princeton, New Jersey, to TD’s board. Colleen’s extensive business and leadership experience have added valuable perspective to the board and the risk committee. Earlier this year, Wendy Dobson, Pierre Lessard and Carole Taylor stepped down from the board. I would like to thank them for their contributions and years of service.

Looking ahead

While we expect the challenges of today will continue – slow growth, regulatory uncertainty, and a challenging global economic environment – we are confident in the strength and resilience of TD’s business model and the people behind it. I’d like to highlight the tremendous work of TD’s 85,000 employees during 2012. When faced with any challenge – from a business imperative to the unprecedented impact of Superstorm Sandy – they rose to the task and exemplified TD’s guiding principles, day in and day out. TD employs a remarkable team of people who care about their businesses, customers and communities, and who continue to make TD The Better Bank.

Once again, on behalf of the board, I’d like to thank our shareholders for their support and trust. We look forward to continuing to work on your behalf in the year ahead.

Brian M. Levitt

Chairman of the Board

Our directors as at December 1, 2012 are listed below. Our Proxy Circular for the 2013 Annual Meeting will set out the director candidates proposed for election at the meeting and additional information about each candidate including education, other public board memberships held in the past five years, areas of expertise, TD committee membership, stock ownership and attendance at Board and committee meetings.

TD Bank Board of Directors
Harold H. MacKay John L. Bragg Wilbur J. Prezzano Hugh J. Bolton Nadir H. Mohamed Henry H. Ketcham John M. Thompson Helen K. Sinclair William E. Bennett Irene R. Miller Colleen A. Goggins Amy W. Brinkley Karen E. Maidment Brian M. Levitt W. Edmund Clark
  • Harold H. MacKay
    MacPherson Leslie & Tyerman LLP,
    Regina, Saskatchewan

  • John L. Bragg
    Chairman, President and Co-Chief Executive Officer,
    Oxford Frozen Foods Limited,
    Oxford, Nova Scotia

  • Wilbur J. Prezzano
    Corporate Director and Retired Vice Chairman,
    Eastman Kodak Company,
    Charleston, South Carolina

  • Hugh J. Bolton
    Chair of the Board,
    EPCOR Utilities Inc.,
    Edmonton, Alberta

  • Nadir H. Mohamed
    President and Chief Executive Officer,
    Rogers Communications Inc.,
    Toronto, Ontario

  • Henry H. Ketcham
    Chairman and
    Chief Executive Officer,
    West Fraser Timber Co. Ltd.,
    Vancouver, British Columbia

  • John M. Thompson
    Corporate Director and Retired Vice Chairman of the Board,
    IBM Corporation,
    Toronto, Ontario

  • Helen K. Sinclair
    Chief Executive Officer,
    BankWorks Trading Inc.,
    Toronto, Ontario

  • William E. Bennett
    Corporate Director and former President and Chief Executive Officer,
    Draper & Kramer, Inc.,
    Chicago, Illinois

  • Irene R. Miller
    Chief Executive Officer,
    Akim, Inc.,
    New York, New York

  • Colleen A. Goggins
    Corporate Director and
    former Worldwide Chairman,
    Consumer Group, Johnson & Johnson,
    Princeton, New Jersey

  • Amy W. Brinkley
    Consultant, AWB Consulting, LLC
    Charlotte, North Carolina

  • Karen E. Maidment
    Corporate Director and
    former Chief Financial and Administrative Officer, BMO Financial Group
    Cambridge, Ontario

  • Brian M. Levitt
    Chairman of the Board,
    The Toronto-Dominion Bank and
    Non-Executive Co-Chair, Osler, Hoskin & Harcourt LLP,
    Montreal, Quebec

  • W. Edmund Clark
    Group President and Chief Executive Officer,
    The Toronto-Dominion Bank,
    Toronto, Ontario

Committee Members* Key Responsibilities*
Corporate Governance Committee Brian M. Levitt
William E. Bennett
Harold H. MacKay
Wilbur J. Prezzano
John M. Thompson

Responsibility for corporate governance of TD:

  • Set the criteria for selecting new directors and the Board’s approach to director independence;
  • Identify individuals qualified to become Board members and recommend to the Board the director nominees for the next annual meeting of shareholders;
  • Develop and, where appropriate, recommend to the Board a set of corporate governance principles, including a code of conduct and ethics, aimed at fostering a healthy governance culture at TD;
  • Review and recommend the compensation of the directors of TD;
  • Satisfy itself that TD communicates effectively with its shareholders, other interested parties and the public through a responsive communication policy;
  • Facilitate the evaluation of the Board and Committees;
  • Oversee an orientation program for new directors and continuing education for directors.
Human Resources Committee Wilbur J. Prezzano
Henry H. Ketcham
Brian M. Levitt
Karen E. Maidment
Nadir H. Mohamed
Helen K. Sinclair
John M. Thompson

Responsibility for management’s performance evaluation, compensation and succession planning:

  • Discharge, and assist the Board in discharging, the responsibility of the Board relating to leadership, human resource planning and compensation as set out in this committee’s charter;
  • Set performance objectives for the CEO which encourage TD’s long-term financial success and regularly measure the CEO’s performance against these objectives;
  • Recommend compensation for the CEO to the Board for approval, and determine compensation for certain senior officers in consultation with independent advisors;
  • Oversee a robust talent planning process that provides succession planning for the CEO role and other senior roles. Review candidates for CEO and recommend the best candidate to the Board as part of the succession planning process for the position of CEO and periodically review TD’s organization structure to ensure alignment with business objectives and succession planning;
  • Oversee the selection, evaluation, development and compensation of other members of senior management;
  • Produce a report on compensation for the benefit of shareholders, which is published in TD’s annual proxy circular, and review, as appropriate, any other related major public disclosures concerning compensation.
Risk Committee Harold H. MacKay
William E. Bennett
Hugh J. Bolton
Amy W. Brinkley
Colleen A. Goggins
Karen E. Maidment
Helen K. Sinclair

Supervising the management of risk of TD:

  • Approve TD’s risk appetite and related metrics and identify and monitor the key TD risks including liquidity and capital management;
  • Approve risk management policies that establish the appropriate approval levels for decisions and other checks and balances to manage risk;
  • Review TD’s actual risk profile against risk appetite metrics and satisfy itself that policies are in place to manage the risks to which TD is exposed, including market, operational, liquidity, credit, insurance, regulatory and legal, and reputational risk;
  • Provide a forum for “big-picture” analysis of an enterprise view of risk, including considering trends and emerging risks.
Audit Committee William E. Bennett**
Hugh J. Bolton**
John L. Bragg
Harold H. MacKay
Irene R. Miller**

Supervising the quality and integrity of TD’s financial reporting:

  • Oversee reliable, accurate and clear financial reporting to shareholders;
  • Oversee internal controls – the necessary checks and balances must be in place;
  • Be directly responsible for the selection, compensation, retention and oversight of the work of the shareholders’ auditor – the shareholders’ auditor reports directly to this committee;
  • Listen to the shareholders’ auditor, chief auditor, chief compliance officer and chief anti-money laundering officer, and evaluate the effectiveness and independence of each;
  • Oversee the establishment and maintenance of processes that ensure TD is in compliance with the laws and regulations that apply to it, as well as its own policies;
  • Act as the Audit Committee and Conduct Review Committee for certain subsidiaries of TD that are federally regulated financial institutions and insurance companies;
  • Receive reports on and approve, if appropriate, certain transactions with related parties.
*As at December 1, 2012
**Designated Audit Committee Financial Expert

At a glance overview

  • We have a strong, independent Chairman with a clear leadership mandate in corporate governance.
  • The Board oversees management, considers and approves on a continuous basis strategic alternatives and plans, and approves all major strategy and policy recommendations for TD Bank Group.
  • The Board is responsible for setting the tone for a culture of integrity and compliance throughout TD.
  • The Board, its committees, the committee Chairs and the Chairman of the Board operate under written charters setting out their responsibilities.
  • The Board renews itself with high calibre candidates with diverse skills and experience.
  • The Audit Committee of the Board, not management, is responsible for the relationship with the shareholders’ auditor.

The Board of Directors and the management of TD are committed to leadership in corporate governance. We have designed our corporate governance policies and practices to be sure we are focused on our responsibilities to our shareholders and on creating long term shareholder value. We can assure you that TD’s policies and practices meet or exceed applicable legal requirements. We continuously monitor all proposed new rules and modify our policies and practices to meet any additional requirements. An overview of our corporate governance structure is set out below.

Role of the chairman of the board

Brian Levitt is the non-executive Chairman of the Board at TD Bank Group. The Chairman of the Board is appointed annually by the non-management directors of the Board. He is independent and his role as Chairman of the Board is to facilitate the functioning of the Board independently of management and to maintain and enhance the quality of our corporate governance at TD. His key responsibilities are set out in the Charter of the Chairman of the Board which is available on our website. He also serves as Chair of the Corporate Governance Committee and is a member of the Human Resources Committee.

Since September 24, 2012, Mr. Levitt has been non-executive co-chair of Osler, Hoskin & Harcourt LLP. From January 1, 2011, Mr. Levitt was Counsel to Osler, Hoskin & Harcourt LLP. From 2001 to 2010, he served as Co-Chair of that firm. From 1991 to 2000, Mr. Levitt was the President and, subsequently, Chief Executive Officer of Imasco Limited, at the time one of Canada's largest consumer products and services companies, which included Canada Trust as one of its major holdings. In addition to being a director of Domtar Corporation Mr. Levitt serves as Chair of the Board of Trustees of the Montreal Museum of Fine Arts and Vice-Chair of the Board of the C.D. Howe Institute. Mr. Levitt served as Chairman of the Board of Domtar Inc. (predecessor of Domtar Corporation) from 2004 to 2007. He is the Chair of the current Judicial Compensation and Benefits Commission of Canada. Mr. Levitt has been an independent director on TD's Board since December 2008.

Overview of corporate governance structure at TD

This diagram is a simple overview of the corporate governance structure at TD.

This diagram is a simple overview of the corporate governance structure at TD

Directors’ key responsibilities

In addition to having the requisite skills and experience, all directors must meet the qualifications for directors set out in the Position Description for Directors of TD. Under the Position Description, directors are expected to serve TD and the long-term interests of its shareholders by supervising the management of the business and affairs of TD. In doing so, the directors are expected to:

  • meet the highest ethical and fiduciary standards;
  • demonstrate independence from management;
  • be knowledgeable and inquisitive about the issues facing TD;
  • apply good sense and sound judgment to help make wise decisions; and
  • display commitment through attendance at, preparation for and participation in meetings.

Directors are expected to fulfill these objectives through accountability, integrity, independence, involvement, contribution and commitment to the bank and its shareholders.

Directors are also subject to the bank’s Code of Conduct and Ethics.

Other places to find information about corporate governance at TD

Corporate Governance – Go to the Corporate Governance section of our website – – to find information on our corporate governance practices, including our Corporate Governance Guidelines, our Director Independence Policy, our Code of Conduct and Ethics, the Charters of our Board of Directors and each of its committees and a summary of significant differences between our governance practices and those required of U.S. domestic issuers listed on the New York Stock Exchange.

Proxy Circular – Read our Proxy Circular – in February 2013 it will be mailed to shareholders and available on our website.

Annual Meeting – Attend our Annual Meeting – April 4, 2013 in Ottawa, Ontario– or watch the webcast through our website –