With both independence and effectiveness in mind, the Board also authorizes individual directors to engage outside advisors at the expense of BMO in appropriate  circumstances. Board committees, under the direction of the committee chairs, are also able to engage independent consultants as needed. The Board, through the Governance Committee, also assesses the performance of the Chairman and CEO in  his role as Chairman, while the Human Resources and Management Compensation Committee evaluates his per- formance as CEO. The Board of Directors is responsible for ensuring the accountability of the Board as a whole and the committees  of the Board. To fulfill this responsibility, the Board assesses the contributions of each director and the adequacy and form of compensation paid to directors. Together with the CEO, the Board also develops position descriptions for the Chairman and CEO as well as annual corporate objectives that the CEO is responsible for meeting. The Board additionally benchmarks directors’ com- pensation annually against BMO’s peer group in order to ensure their compensation reflects the responsibilities and risks involved in serving as a director. To further align directors’ interests with those of shareholders, at least 50% of a director’s annual retainer must be paid in Bank stock or in deferred share units, with an option to receive 100% of both the retainer and any fees in this manner. In addition, directors are required to hold either common shares or deferred share units with a value of not less than six times their annual retainer. To further ensure accountability, the Board sponsors an annual review of Board effectiveness in corporate  governance. Conducted by outside consultants, the survey assesses areas ranging from the operational effectiveness of the Board and its committees to the Chairman’s role and succession planning. At the same time, the Board abides by a set of policies, which include an attendance requirement stipulating that directors must attend 75% of meetings, as well as manda- tory retirement at age 70 and resignation (for acceptance orrejectionbytheBoard)uponachangeinprincipal occupation. As well, the Board oversees an annual director peer feedback performance review. The survey, which is com- piled by an outside consultant to ensure confidentiality, requires each director to assess the contribution of each of his or her peers on a wide variety of measures including ethics, strategic insight, financial literacy, business judg- ment, participation and communication. Both the Board and peer assessments enable the Board to examine its  effectiveness and establish goals for constant improvement. At BMO Financial Group, we are committed to main- taining and building upon our reputation as a leader in corporate governance. Like the independent experts who commend our actions, we believe that effective corporate governance benefits our shareholders, employees, com- munities – and our business.  For a more detailed report on our corporate governance program, please refer to our Proxy Circular. BMO FINANCIAL GROUP ANNUAL REPORT 2002 9 GUYLAINE SAUCIER, C . M ., F . C . A . Montreal, Quebec Corporate Director NANCY C. SOUTHERN Calgary, Alberta Co-Chairman and Chief Executive Officer ATCO Ltd. and Canadian Utilities Limited J. ROBERT S. PRICHARD, O . C ., O . Ont . Toronto, Ontario President and Chief Executive Officer,  Torstar Corporation JEREMY H. REITMAN Montreal, Quebec President, Reitmans (Canada) Limited JOSEPH L. ROTMAN, O . C ., LL . D . Toronto, Ontario Chairman and Chief Executive Officer  Roy-L Capital Corporation Accountability