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Earning your trust is a continuous process and your Board of Directors, management team and employees are committed to fulfilling that promise every day. Long before “corporate governance” became the watchword of regulators and the media, we were proactive in adopting strong governance standards. In 1980, and again in 1993, special board committees reviewed the role and function of the board and its practices. Then, as now, we recognized that the foundation of an organization’s governance is built on its ethics and the collective will of its directors, management and employees to express those values in their professional conduct. For us, good governance has always been the highest ethical standards of business practices and processes. Our directors are shareholders themselves. We recognize that investors place a higher value upon companies that operate in a transparent manner. We are continually motivated to perform to investors’ and regulators’ high expectations and standards. Despite the satisfaction of seeing many observers recognize our activities as best practices, we routinely refine and review our governance standards in order to vigorously reinforce a culture of responsibility and accountability. Together, the board and management believe that earning your trust requires a high degree of openness, so we are continually working to enhance the disclosure of information provided to shareholders. In addition to actively contributing to the development of accounting standards, we are an early adopter of many of them and seek to keep investors’ interests at the heart of governance practices. Our current Management Proxy Circular includes more comprehensive disclosure with respect to governance, including our Director Independence Policy, which incorporates standards from both Canada and the U.S. and reflects our determination to adapt to and capitalize upon the international scope of our operations. In the past year, we continued our long-established practice of holding sessions of non-management directors following board meetings. (More information about our governance practices can be found on pages 112 to 113 and at rbc.com/governance.) For us to earn and maintain your trust, you must be comfortable that governance begins – not ends – with the office of the chairman and the board. We support management’s leadership and efforts to ensure that principles and values entrenched at the top of the organization are also evident throughout the company. I am tremendously proud of having served as the company’s first non-executive Chairman. It has been my pleasure to work with a board of talented directors to supervise a skilful and dedicated management team. I have found it extremely rewarding and challenging to be a director and part of the organization’s accomplishments over 13 years. As a shareholder, I look forward to watching RBC Financial Group achieve its potential under the stewardship of a new chairman following my retirement in February 2004. I retire with the comfort in knowing that the board’s work will continue to be characterized by high standards of integrity, discipline and governance. Under David O’Brien’s leadership, shareholders can rest assured that the efforts of RBC will remain aimed at earning your trust.
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