2018 Guide to Effective Proxies

2.2 Board/CEO letter | 41 6 TH EDITION | GUIDE TO EFFECTIVE PROXIES PRUDENTIAL FINANCIAL, INC. REPUBLIC SERVICES, INC. SCANSOURCE SCHNITZER STEEL INDUSTRIES, INC. PrudentialFinancial,Inc. 751BroadStreet, Newark,NJ07102 March22,2018 Letter from the Board of Directors to Our Shareholders TheBoardvaluesthisopportunitytoshareourperspectiveregardingtheworkweundertookforourshareholdersduring2017. Ourobjectiveistoguideandoverseemanagementinthecreationoflong-termvaluethroughtheexecutionofasoundbusiness strategy,prudentriskmanagement,talentdevelopment,successionplanning,acommitmenttocorporateethics,andcreating societalimpact.Inpursuitoftheseobjectives,wearepleasedtosharewithyouanoverviewoftheBoard’sprioritiesandactions duringtheyear. BUSINESS STRATEGY Webelievethatanoptimalandeffectiveboardisinformed,activeandconstructivelyengagedwithmanagement,withoutundue disruptiontotheday-to-daybusinessofthecompany.OurBoardmeetsregularlytodiscussPrudential’sstrategicdirection.Our collectiveskillsandexperienceintheareasofregulation,businessoperations,riskmanagementandcapitalmarketsenableusto providecriticalinsightstoourCompanytohelpmaximizeshareholdervalueandsupportthepursuitofourmission:‘‘Tohelpour customersachievefinancialprosperityandpeaceofmind.” AteachBoardmeetingandduringourannualstrategyplanningsession,weengagewithPrudential’sseniorleadershipinrobust discussionsabouttheCompany’soverallstrategy,prioritiesforitsbusinesses,andlong-termgrowthopportunities. BOARD RISK OVERSIGHT ManagingandmonitoringrisksareimportanttoouroversightofPrudential,andwetakethisresponsibilityseriously.Weregularly reviewtheCompany’sriskprofile,includingitsapproachtocapitalmanagement,itsoperationalfootprint,anditsinvestmentrisks andstrategies.TheBoardconsidersthebreadthoftheCompany’sriskmanagementframeworkwhenapprovingitsstrategyand risktolerance,andverifiesthatstrategicplansarecommensuratewithourabilitytoidentifyandmanagerisk. TheBoard’sRiskCommitteeincludesthechairsofeachoftheotherBoardcommittees,allowingustomorecloselycoordinate ourriskoversightfunction.TheRiskCommitteehasmetricsinplacetomonitorandreviewmarket,insurance,investmentand operationalrisk. CULTIVATING A STRONG ETHICAL CULTURE Werecognizetheimportanceofdoingbusinesstherightwayinallofourlocationsacrosstheglobe.Weworkwithmanagement tosetandcommunicatetheappropriateethical“tone”fortheCompany,whichguidesourconductandprotectsPrudential’s reputation. Webelieveemployees’actionsaresignificantlyinfluencedbyanorganization’sculture,andthatthecorporateenvironmentoften determineshowemployeesmakedecisions.TohelpusmonitortheengagementofPrudential’sworldwideworkforce,wemeet withseniorleadersrepresentingPrudential’sglobalbusinessesthroughouttheyear,includingthoseonthefront-linewhohave directcustomercontact.PrudentialalsomaintainsarobustethicsandcomplianceprogramdirectedbyitsChiefEthicsand ComplianceOfficer,withwhomwemeetregularly.Wealsoassessemployeeengagementsurveys,employeeturnover,andthe Company’sincentiveplanstoensurethatgoalsandperformancearebothreasonableandaligned. TALENT DEVELOPMENT AND SUCCESSION PLANNING Thediversityofexperiences,backgroundsandideasofPrudential’sglobalemployeesenablesustodevelopproductsthat addressthefinancialsecurityneedsofourcustomers.Therefore,recruiting,developingandretainingtopdiverseindustrytalent isakeypriorityfortheCompany.TalentdevelopmentisdiscussedateveryBoardmeeting,andonceperyear,theBoarddevotes timetodiscusstalentateachbusinessandfunctionalleadershiplevelacrosstheCompany.Thisengagementgivesusrich insightintotheCompany’spooloftalentanditssuccessionplans. 2 | NoticeofAnnualMeetingofShareholdersand2018ProxyStatement Total of 02 pages in section March29,2018 DearShareholder: Wearepleasedtopresentyouwiththe2018RepublicServices,Inc.ProxyStatementandcordiallyinviteyoutoattendthe2018 annualmeetingofshareholders,whichwillbeheldat10:30a.m.,localtime,onFriday,May11,2018,attheScottsdaleMarriott atMcDowellMountains,16770N.PerimeterDrive,Scottsdale,Arizona85260. ContinuedProfitableGrowththroughDifferentiation: AsanindustryleaderinU.S.recyclingandnon-hazardoussolidwaste, wearededicatedtodeliveringsimplesolutionstoaddressthenation’swastechallenges.Wedeliverlong-termshareholder valuebyprofitablygrowingourbusinessthroughorganicgrowthopportunitiesandacquisitions,gainingpricingpowerthrough differentiationandsuperiorservicedeliveryandeffectivelymanagingourcoststructure.Wehaveprovidedconsistent,positive returnstoourshareholders,andhaveastrongtrackrecordofincreasingcashreturnstoshareholdersthroughdividendsand sharerepurchases.Oursolidrecordofperformanceisdrivenbyourlong-termfocusonthefivepillarsofourProfitableGrowth throughDifferentiationstrategy: • MarketPosition —developthebestverticallyintegratedmarketpositiontoenableustobuilddensityandimprovereturns; • OperatingModel —deliverconsistent,high-qualityservicetoallofourcustomersthroughTheRepublicWay: OneWay. Everywhere.Everyday ; • People&TalentAgenda —createanenvironmenttoattractandretainthebesttalent; • CustomerZeal —drivecustomerloyaltybyofferingdifferentiatedproductsspecificallydesignedtomeetourcustomers’ needs;and • DigitalPlatform —provideaconsistentexperienceacrossourbusinesswhileenablingourcustomerstodobusinesswithus throughmorechannelsandwithbetteraccesstoinformation. ShareholderEngagement: Wehavedevelopedabroadshareholderengagementprogramthatprovidesuswithvaluable insightandfeedbackfromourshareholdersthroughouttheyear.During2017,independentmembersofourBoardand membersofourmanagementteamengagedwithshareholdersrepresentingapproximately52%ofourinvestorbase.Theinput receivedcontinuestobeincorporatedintoourBoard’sdeliberationsanddecisions,particularlyinthecontextofBoard composition,governancepractices,executivecompensationandsustainabilityprograms. CorporateResponsibility&Sustainability: Wearealsocommittedtothecommunitiesweserveandtotheenvironment.We believewehavearesponsibilitytoregenerateourplanetwiththematerialsweareentrustedtohandleeverydaybydriving increasedrecycling,generatingrenewableenergy,andhelpingourcustomerstobemoreresourceful.OurBoardisdirectly involvedintheoversightofourcorporateresponsibility,environmentalandsustainabilityinitiatives,andconductsaformal comprehensivereviewoftheCompany’sperformanceintheseareasonanannualbasis.Ourachievementsdemonstrateour abilitytoconnectfinancialperformancewithenvironmentalandsocialperformance. BoardRefreshment: Overthelastfiveyears,wehaveaddedsevendirectorstoourBoard.In2017,weaddedKimS.Pegula andmadeotherchangestoourBoardcommitteemembership.Thesechangesreflectourcontinuedcommitmenttoregular Boardevaluationandillustrateourstrongsuccessionplanningpractices,bothofwhichwebelieveareimportanttoourBoard’s effectiveness. Sincerely, ManuelKadre DonaldW.Slager ChairmanoftheBoard President&ChiefExecutiveOfficer For further information about the 2018 Annual Meeting, please call (800) 248-3170 December20,2017 Dear Shareholder: On behalf of our Board of Directors, we are pleased to invite you to attend Schnitzer Steel’s 2018 AnnualMeetingonTuesday,January30,2018inPortland,Oregon. Whether or not you are able to attend our meeting in person, we invite you to read this year’s proxy statement which highlights our key activities and accomplishments in fiscal 2017 and presents mattersforwhichweareseekingyourvote. In fiscal 2017, our business delivered its best results in six years, led by significantly improved operating performance resulting in greater profitability and higher earnings per share on both a reportedandadjustedbasis. In a market environment in which we saw stable to steadily improving prices and demand for ferrous and nonferrous recycled metal,ourstrongresultsreflectthesustainedbenefitsfromourmulti-yearcostreductionandproductivityimprovementinitiatives and significant progress toward achieving our long-term goals to increase sales volumes and expand operating margins. In addition, we remained steadfast in our focus on safety, sustainability, and integrity as tenets of our Company’s core strategy to delivergrowthandprofitability. Our fiscal 2017 reported earnings per share of $1.60 and adjusted earnings per share of $1.53 representsubstantialincreasescomparedtofiscal 2016 reported loss per share of $0.66 and adjusted earnings per share of $0.69. In fiscal 2017,wegenerated10%higherferrousvolumes, 15% higher nonferrous volumes, and 2% higher finished steel volumes year-over-year. In our Auto and Metals Recycling business, we delivered record car purchase volumes and shipped our ferrous and nonferrous products to 24 countries. We shipped almost 40% of our volumes into the domestic market, demonstrating the flexibility of our operating platform. In our Cascade Steel and Scrap business, we completed the integration of our steel manufacturing and Oregon metals recycling operations and invested in a major equipment upgrade aimed at increasing productivityandenhancingproductquality. Ourstrongeroperatingperformanceenabledusto deliveroperatingcashflowof$100millioninfiscal 2017 and to reduce our total debt by 25% year- over-year. In fiscal 2017, we returned $20million toshareholdersthroughdividendpaymentswhich havebeenpaidquarterlysince1994. In August, we released our third annual sustainability report which continued to show improvement in key resource metrics. We lowered water usage, energy consumption, and carbon emissions. We also diverted more waste from landfills both in terms of reducing our internally generated waste and by recycling higher volumes of scrap metal. Beyond our core environmentalinitiatives,westrivetobetterserve our employees, our customers, and our communities by providing an inclusive, diverse, and safe working environment. In fiscal 2017, 84% of our facilities experienced zero lost time due to injuries, and for the third consecutive year, we were named one of the World’s Most EthicalCompaniesbytheEthisphereInstitute. Consolidated Operating Income (Loss) (in thousands) 2016 2017 $56,013 ($7,842) 2016 $54,043 $27,772 AdjustedConsolidatedOperating Income (in thousands) * 2017 Diluted EarningsPerShare 2016 2017 $1.53 $0.69 AdjustedDiluted Earnings Per Share * 2016 2017 ($0.66) $1.60 Total Debt (in thousands) $192,518 2016 2017 $145,124 TotalDebt,Net ofCash (in thousands) * $165,699 $137,837 2016 2017 *Seepages47-49oftheCompany’sAnnualReportonForm10-KfiledwiththeSecuritiesand ExchangeCommissiononOctober24,2017forareconciliationofthesenon-GAAPmeasurestotheir mostdirectlycomparableGAAPmeasures. NoticeofAnnualMeetingofShareholdersand2017ProxyStatement | 1 Total of 02 pages in section Letter from our Chairman Fellowshareholders: ThankyouforyourinvestmentinScanSource.OnbehalfofScanSource’sBoardofDirectors(the“Board”),itismy pleasuretoinviteyoutojoinusattheupcoming2017AnnualMeetingofShareholders.Ifyouareunabletomakethe AnnualMeeting,Iwanttoencourageyoutocastyourvoteontheitemsdiscussed intheProxyStatementusingthe attachedproxycard. IwouldliketotakethisopportunitytoprovideyouwithanupdateonwhattheBoardhasaccomplishedin2017. Duringfiscal2017,ourBoardfocusedonensuringthatwecontinuedtoimplementourcapitalallocationstrategy,which isdesigned tocreatevalueforourshareholders.TheBoardworkedtooverseethedeploymentofcapitalthrough organicgrowth,strategicacquisitions,andsharerepurchases. Oneofthehighlightsofourfiscal2017performanceisthe $95millionofoperatingcashflowgenerated overthelasttwelvemonths,whichissignificantlyhigherthantheprior yearperiod.Thisreflectssomeworkingcapitalefficiencyandadditionalcashflowfromacquisitions.Sincethelast shareholdermeeting,wemadetwoacquisitions,themostsignificantofwhichwasthepurchaseofPOSPortal,aleading distributorofpaymentdevicesandservicesprimarilytotheSMBmarketsegment.POSPortalbrings17yearsof demonstratedsuccessfocusedsolelyontheUSpaymentsindustrychannels.Wehavecontinuedtoexecuteuponour corporatedevelopmentstrategy,completingsixacquisitionsinthelastthirty-sixmonths,andcontinuetolookfor opportunitiestogrowourbusinessinareasthatarehigher-marginandhigher-growth. Inadditiontostrategicacquisitions,inAugust2016,theBoardextended oursharerepurchaseprogramforasecond $120million.Infiscal2017,weacquiredapproximately578,000sharesforapproximately$20.3millionandwehave approximately$100millionremainingonourexistingsharerepurchaseauthorization. WeareverypleasedthatBettyTemplejoinedourBoardeffectiveSeptember11,2017.BettyservesastheChairand ChiefExecutiveOfficerofWombleCarlyleSandridge&Rice,LLPand,asofNovember1,2017,servesasCo-Chairand ChiefExecutiveOfficerofWombleBondDickinson,aGlobalTop100lawfirm.Ms.Templehasawealthofexperience counselingpublicandprivatecompaniesontheirhigheststrategicpriorities.Herbackgroundasalegaladvisortopublic companiesandboardsprovidesourBoardwithadditionalexpertiseintheareasofriskmanagement,corporate governance,acquisitionsandsecuritiesregulation. TheBoardremainsdeeplycommittedtoasoundgovernancestructurethatpromotesthebestinterestsofour shareholders.Tothatend,theBoardcontinuestoexamineemergingcorporategovernancetrendsandbestpractices. WehavecorporategovernanceguidelinestohelpensurethattheBoardisindependent frommanagementand appropriatelyperformsitsfunctionastheoverseerofmanagement,andthattheinterestsoftheBoardand managementalignwiththeinterestsofourshareholders.Webelievethatourcurrentleadershipstructureand corporategovernanceguidelinesensureeffectiveindependent Boardleadershipandoversightofmanagement.During fiscal2017,ourdirectorsregularlymetinexecutivesessionswithouttheChiefExecutiveOfficeroranyothermembers ofmanagementpresent.Strongindependent directorleadershipalsoisevidenced bythefactthatIamanindependent ChairmanandalloftheBoardCommitteesarecomprisedsolelyof,andchairedby,independent directors. OnbehalfofScanSource’sBoardandthemembersofScanSource’sseniormanagementteam,welookforwardto seeingyouattheupcoming2017AnnualMeetingofShareholders.TheattachedNoticeofAnnualMeetingof ShareholdersandProxyStatementwillserveasyourguidetothebusinesstobeconductedatthemeetingthisyear. Yourvoteisimportanttous.Again,IwanttoencourageyoutoparticipateintheCompany’sfuturebycastingyourvote ontheitemsdiscussed intheProxyStatement.Pleasevoteearlybysigningandreturningyourproxycardorbyvoting viatelephoneoronlineasdetailedintheProxyStatement.Thankyouforthetrustyouhaveplacedinusandforyour continuedsupportofScanSource. Bestregards, StevenR.Fischer ChairmanoftheBoard