Corporate Governance The Board of Directors  and management believe that sound and effective corporate governance is essential to the Company’s performance. Sound corporate governance practices are an important part of First Capital’s corporate culture. The following are highlights of the Company’s approach to governance: The Audit Committee is responsible for assisting the Board in fulfilling its oversight responsibilities in relation to: the integrity of the Company’s financial statements; the Company’s compliance with legal and regulatory requirements related to financial reporting; the qualifications, independence and performance of the Company’s auditor; the design and implementation of internal controls and disclosure controls; and any additional matters delegated to the Audit Committee by the Board. All of the members of the Audit Committee are financially literate.  The Compensation and Corporate Governance Committee is responsible for assisting the Board in fulfilling its oversight responsibilities in relation to: the appointment, development, compensation and retention of senior management; the management of employee benefit plans; the Company’s overall approach to corporate governance including the size, composition and structure of the Board and its committees; education for directors; related party transactions and other matters involving possible conflicts of interest; and any additional matters delegated to the Compensation and Corporate Governance Committee by the Board. 68 First Capital Realty Annual Report 2003 • The Board has established two committees comprised entirely of unrelated and independent directors to assist it in fulfilling its responsibilities: • The Board is currently comprised of ten directors, eight of whom are unrelated and independent. • The Board of Directors supervises the conduct of the affairs of the Company. In carrying out its responsibilities, the Board appoints the senior executives of the Company and meets with them on a regular basis. Along with those matters which by law must be approved by the Board, key strategic decisions are also submitted by management to the Board for approval. In addition to approving specific corporate actions, the Board reviews and approves the reports issued to shareholders, including annual and interim financial statements, as well as materials prepared for shareholders’ meetings. The Board also approves the Company’s overall business strategies and annual business plans for achieving its objectives. • The Board of Directors and management believe that sound and effective corporate governance is essential to the Company’s performance. The Board has been reviewing its approach to corporate governance in light of recent regulatory developments to ensure that its commitment to high standards of corporate governance is maintained.