PAY RATIO DISCLOSURE
For 2018, the ratio of the annual total compensation of Mr. Hughes, our Chief Executive Officer (CEO Compensation), to the median of the annual total compensation of all of our employees and those of our consolidated subsidiaries (other than Mr. Hughes) (Median Annual Compensation), was 89 to 1. We note that, due to our permitted use of reasonable estimates and assumptions in preparing this pay ratio disclosure, the disclosure may involve a degree of imprecision, and thus this pay ratio disclosure is a reasonable estimate calculated in a manner consistent with Item 402(u) of Regulation S-K using the data and assumptions described below. In this summary, we refer to the employee who received the Median Annual Compensation as the Median Employee. For purposes of this disclosure, the date used to identify the Median Employee was October 31, 2017 (the Determination Date). We have used the same Median Employee as we did for our 2017 pay ratio, because there has been a change in our employee population or employee compensation arrangements that we reasonably believe would significantly impact our pay ratio disclosure.
For purposes of this pay ratio disclosure, CEO Compensation was determined to be $4,463,941 which amount represents the total compensation reported for Mr. Hughes under the 2018 Summary Compensation Table for 2018. Median Annual Compensation was determined to be $49,960.11 and was calculated by totaling for our Median Employee all applicable elements of compensation for 2018 in accordance with Item 402(c)(2)(x) of Regulation S-K.
To identify the Median Employee, we measured compensation for the period beginning on January 1, 2017 and ending on October 31, 2017 for 9,053 U.S. and non-U.S. employees, representing all full-time, part-time, seasonal and temporary employees for us and our consolidated subsidiaries as of the Determination Date. This number does not include any independent contractors or leased workers, as permitted by the applicable SEC rules.
This compensation measurement was calculated by totaling, for each employee, annual compensation which is defined as base salary, overtime wages, production allowances, commissions and bonus which represents the consistently applied compensation measure that we used for our pay ratio determination. Specifically excluded from the consistently applied compensation measure were relocation expense, severance payments and ex-patriate allowances. Further, we did not utilize any statistical sampling or cost-of-living adjustments for purposes of this pay ratio disclosure.
A portion of our employee workforce (full-time and part-time) identified above worked for less than the full fiscal year due to commencing employment after January 1, 2017. In determining the Median Employee, we annualized the total compensation for such individuals (but avoided creating full-time equivalencies) based on reasonable assumptions and estimates relating to our employee compensation program.
THE BOARDS ROLE IN RISK OVERSIGHT
The Board evaluates risk both collectively and as a function of its respective committees, including general oversight of (i) achievement of organizational objectives, including strategic objectives, to improve long-term organizational performance and enhance shareholder value, and sustainability objectives; (ii) the financial exposure of the Company; (iii) risk exposure as related to overall Company portfolio and impact on earnings; (iv) information technology security and risk; (v) compliance with environmental, health, safety and other laws and regulations and (vi) all systems, processes, and organizational structure and people responsible for finance and risk functions. Our Audit Committee assists our Board in fulfilling its oversight responsibilities by regularly reviewing risks associated with financial and accounting matters, as well as those related to financial reporting. In this regard, our Audit Committee monitors compliance and regulatory requirements and internal control systems. Our Audit Committee also reviews the process by which enterprise risk management is undertaken by the Company
Our Compensation Committee assists the Board with risk oversight through its review of compensation programs to help ensure such programs do not encourage excessive risk-taking. The Compensation Committee reviews base compensation levels, incentive compensation and succession plans to confirm the Company has appropriate practices in place to support the retention and development of the employees necessary to achieve the Companys business goals and objectives.
Our Nominating and Governance Committee oversees the Company's risk management metrics process and assists the Board with risk oversight through its oversight of the Companys sustainability matters. The Companys Sustainability Committee, which is chaired by one of the Companys named executive officers, has oversight and responsibility for monitoring the environmental, health, safety and social risks related to the Company and its operations, as well as other sustainability matters. The Sustainability Committee reports regularly to the Nominating