Company’s business strategy. This separation of the roles of Chairman and Chief Executive Officer allows for greater oversight of
the Company by the Board. The Board has determined that
the Company’s Board leadership structure is the most appropriate at this time, given the specific characteristics and circumstances of
the
Company, and the unique skills and experience of each of Mr. Marcus and Mr. Schall.
With respect to the Board’s role in the risk oversight of
the Company, the Board has promulgated internal Company policies that set forth which transactions may require the prior approval of the Board or a committee of the Board and which transactions may proceed with management authorization and without any such prior Board approval. These Board policies cover transactions in the following areas: financings, property acquisition, property development, property redevelopment, property dispositions, other investments and general corporate activities. Generally, these policies set forth a specified dollar threshold and if a transaction exceeds that threshold,
the prior approval of the Board or a committee of the Board is required. By requiring the prior approval of larger transactions, which generally may involve more risk to
the Company simply due to the transaction size, the Board seeks to provide risk oversight of
the Company. The Board has promulgated a corporate investment policy that establishes guidelines with respect to investment of
the Company’s funds; such guidelines cover the required qualifications of outside investment managers and the types and concentration limits of investment securities that are authorized for investment. The Compensation Committee has determined that the pay policies and practices of
the
Company are not reasonably likely to have a material adverse effect on
the Company. Also, related party transactions are generally reviewed by the Audit Committee. See
“Certain Relationships and Related Person Transactions – Policies and Procedures with Respect to Related Person Transactions.”Upon the recommendation of the Nominating Committee, the Board nominated the following incumbent directors for election at the Annual Meeting: Mr. Guericke, Ms. Hawthorne, Ms. Johnson, Ms. Kasaris, Mr. Lyons, Mr. Marcus, Mr. Robinson, Mr. Schall, and Mr. Scordelis.
Under independence standards established by the Board, which reflect the NYSE director independence standards as currently in effect, a director does not qualify as independent unless the Board affirmatively determines that the director has no material relationship with
the Company, either directly or as a partner, stockholder or officer of an organization that has a relationship with
the
Company. The Board considers such facts and circumstances as it deems relevant to the determination of director independence.
The Board has determined that the following directors have no material relationship with
the Company (either directly or as a partner, stockholder or officer of an organization that has a relationship with
the Company), and each is independent within the meaning of independence as set forth in the rules of the NYSE: Maria R. Hawthorne, Amal M. Johnson, Mary Kasaris, Irving F. Lyons, III, George M. Marcus, Thomas E. Robinson and Byron A. Scordelis.
In
determining the independence of Mr. Marcus, the Board considered the matters that refer to Mr. Marcus set forth under “Certain Relationships and Related Person Transactions” below. The Board also considered the directors’ ownership of Essex equity securities and determined, in accordance with principles of the NYSE listing standards, that such ownership is not inconsistent with a determination of independence.
Director Tenure and Board Refreshment
Led
by our Nominating Committee, our Board seeks to maintain a board that, taken as a whole, has the objectivity, diversity and mix of skills, reputation and experience to provide comprehensive and effective oversight of
the Company’s strategic, operational and compliance risks, as well as the knowledge, ability and independence to deliver the high standard of governance expected by our stockholders. The Nominating Committee believes that ongoing board refreshment is important to maintain an appropriate mix of skills and provide fresh perspectives while leveraging the institutional knowledge and historical perspective of the Board’s longer-tenured members. In August 2017, the Nominating Committee initiated a plan focused on board refreshment, with a specific focus on expanding the diversity of the Board based on gender, experience and expertise. Since then,
the
Company has accomplished the following:
• | Reduced long-tenured Board members, with the average tenure reduced since August 2017 by three years. |
• | Increased diversity in gender, experience and expertise with the addition of three female board members, Mary Kasaris and Amal Johnson in 2018, and Maria Hawthorne in 2020, and expanded expertise in the technology sector. |
• | Two directors self-identify as diverse. |