Governance

Sound governance and management systems enable a company to operate in a transparent and accountable way. They provide effective oversight and help a company translate its aspirations into action while operating to high ethical standards.

The concept of governance is expanding beyond its traditional focus on fiduciary responsibility to shareholders to a broader focus on a company's impact on the world and its responsibilities to diverse stakeholders. At Ford, this is reflected in our development and integration of sustainability structures, processes and management systems into the core business.

Assessing Materiality

A number of topics related to governance and accountability were identified as issues of importance to Ford and our stakeholders in the materiality analysis. Shareholder concerns (i.e., resolutions) and ethical business practices were two issues identified. Concerns expressed exclusively through shareholder resolutions were judged to be of low potential impact on the Company and medium concern to stakeholders. Ethical business practices were judged to be of high potential impact for Ford and medium concern to stakeholders.

Issues related to Ford's sustainability strategy, vision and management were also identified in the analysis and judged to be of high potential impact on the Company and medium concern to stakeholders.

Several public policy issues were identified in the analysis, including greenhouse gas and fuel economy regulation, health care reform, global environmental regulation and political payments and contributions. Political contributions were judged to be of medium potential impact on the Company and medium concern to stakeholders. Changing environmental and safety regulations in general were judged to be of high potential impact on Ford and low concern to stakeholders. Regulations related to GHG emissions and fuel economy, however, were judged to be of high potential impact on the Company and high concern to stakeholders.

Based on this assessment, we have included discussion of all of these issues in this Web report, in this or other relevant sections.