Corporate Governance – Board of Directors

Ford’s corporate governance principles, code of ethics and charters for each Board committee – all publicly available in the corporate governance section of the Ford website – set the framework for Ford’s Board of Directors.

Ford’s Board addresses significant business issues as a full group and through five committees: Audit, Compensation, Finance, Nominating and Governance, and Sustainability. The Sustainability Committee was formed in 2008 from the former Environment and Public Policy Committee, reflecting the evolution of its responsibilities and the Company’s challenges and opportunities. The principal functions of the Sustainability Committee are as follows:

• Assist management in the formulation and implementation of policies, principles and practices to foster the sustainable growth of the Company on a worldwide basis. “Sustainable growth” means the ability to meet the needs of current customers while taking into account the needs of future generations. “Sustainable growth” also encompasses a business model that creates value consistent with the long-term preservation and enhancement of financial, environmental and social capital.
• Assist management in the formulation and implementation of policies, principles and practices to permit the Company to respond to evolving public sentiment and government regulation in the area of motor vehicle and stationary source emissions, especially in the area of greenhouse gas emissions, fuel economy and carbon dioxide regulation.
• Assist management in setting strategy, establishing goals and integrating sustainability into daily business activities across the Company.
• Review on a continuing basis new and innovative technologies that will permit the Company to achieve sustainable growth and Company actions to protect those technologies.
• Review on a continuing basis partnerships and relationships, both current and proposed, with customers and others that support the Company’s sustainable growth.
• Review on a continuing basis the Company’s communication and marketing strategies relating to sustainable growth.

During 2011, eight Directors served on the Sustainability Committee, which is chaired by Dr. Homer Neal, an independent director. Ford’s Board of Directors met nine times and the Sustainability Committee met four times.

The Board’s Nominating and Governance Committee considers several qualifications when considering candidates for the Board. Among the most important qualities directors should possess are the highest personal and professional ethical standards, integrity and values. They should be committed to representing the long-term interests of all shareholders. Directors must also have practical wisdom, mature judgment and objectivity. Ford recognizes the value of diversity and we endeavor to have a diverse Board, with experience in business, government, education and technology, and in areas that are relevant to the Company’s global activities.

Under New York Stock Exchange (NYSE) Listed Company rules, a majority of our directors must be independent directors. The NYSE rules also provide that no director can qualify as independent unless the Board affirmatively determines that the director has no material relationship with the listed company. Ford’s standards in determining whether or not a director has a material relationship with the Company are contained in the Company’s Corporate Governance Principles. Based on Ford’s standards, 13 of the Company’s current 16 Directors are independent. Two of Ford’s Directors are women, one Director is African-American and one Director is Hispanic.

Each Board member participates in an annual assessment of the effectiveness of the Board and the Committees on which he or she serves. We have established a procedure for shareholders to submit accounting and other concerns to independent directors and to send other communications to the Board.

For more information on Ford corporate governance practices, including the principles and policies that govern the conduct of the Board and the members of the Board, please see our website.