Board Practices

The Evergreen Funds Board of Trustees is committed to overseeing the Evergreen funds to ensure that each fund is managed in the best interests of its shareholders. Each Board member adheres to certain industry-wide regulations and best practices to enforce proper fund governance.

Click on the links below for information regarding the Board's practices in the following areas:

Nomination and selection of Board members

The Executive Committee of the Board, which consists entirely of independent trustees, acts as a Nominating Committee for new members. Today, the Executive Committee consists of the Chairman of the Board, Mr. Michael S. Scofield, Mr. K. Dun Gifford, and Dr. Russell A. Salton, III.

Once a nominee has been selected by the Executive Committee, he or she must be approved by a majority of the trustees, including a majority of the independent trustees.

Back to top

Board compensation

The Executive Committee recommends the compensation for the entire Board of Trustees, including interested trustees. The recommendation must be approved by a majority of the independent trustees.

Back to top

Length of each Board member's terms

For open-end funds, each trustee serves until a successor is duly elected or qualified, or until his or her death, resignation, retirement or removal from office. For closed-end funds, the trustees are elected to three-year terms on a rotating schedule. Every year, a group of trustees is re-elected for a three-year term. The mandatory retirement age for open- and closed-end fund Board members is 75.

Back to top

Frequency of Board meetings

The Board meets at least six times a year and more frequently, as needed. At its quarterly meetings, the Board reviews fund performance, fund expenses, contractual arrangements and regulatory compliance, among other issues. The independent trustees meet in separate sessions without members of Evergreen management being present at least once a quarter.

The Board's committees—including the Executive, Performance, Audit, 15(c) and Distribution, 12b-1, and Service Committees—also meet separately at least quarterly and more frequently, as needed. The independent Chairman of the Board controls the Board's meeting agenda.

Back to top

Trustee investments in the Evergreen funds

The Board has adopted a policy requiring each trustee to invest in Evergreen funds over time, in an amount sufficient to ensure that the trustee's interests are aligned with the interests of Evergreen shareholders.

Back to top

Process for overseeing fund performance

The process for overseeing fund performance is as follows:

  • The Board receives comprehensive quarterly performance data for each fund. Data includes information about investment performance, expense ratios, turnover rates, sales, redemptions and asset levels.
  • The Board classifies each fund by type so that trustees can comprehensively review the performance of each fund type.
  • Each month, the Chairman of the Board's Performance Committee reviews a monthly performance report to highlight the funds that are performing well and those that are underperforming.
  • Each quarter, the Performance Committee meets with Evergreen's Chief Investment Officer and individual portfolio managers to review performance. Increased emphasis is placed on underperforming funds.
  • The Board also commissions reviews and comparisons by independent outside analysts to prepare for the advisory contract negotiation process.

 

Back to top

Use of outside counsel or independent advisors

The Board is advised by independent legal counsel and has direct access to the Evergreen funds' independent auditors and any other expert they deem necessary. The Board has also hired an independent consultant to assist them in fulfilling their responsibilities.

Back to top