EX-99.1 2 d302486dex991.htm EXHIBIT 99.1

TABLE OF CONTENTS

|  | Page |
ANNUAL INFORMATION FORM |  |  | 3 |
CORPORATE STRUCTURE |  |  | 3 |
Name, Address, and Incorporation |  |  | 3 |
Intercorporate Relationships |  |  | 4 |
GENERAL DEVELOPMENT OF THE BUSINESS |  |  | 5 |
Three-Year History |  |  | 5 |
DESCRIPTION OF THE BUSINESS |  |  | 9 |
RISK FACTORS |  |  | 12 |
DESCRIPTION OF CAPITAL STRUCTURE |  |  | 12 |
Preferred Shares |  |  | 12 |
Common Shares |  |  | 13 |
MARKET FOR SECURITIES |  |  | 13 |
DIRECTORS AND OFFICERS |  |  | 14 |
AUDIT AND RISK COMMITTEE INFORMATION |  |  | 16 |
Audit and Risk Committee Terms of Reference |  |  | 16 |
Composition of the Audit and Risk Committee |  |  | 16 |
Preapproval Policy |  |  | 17 |
External Auditor Service Fees |  |  | 17 |
LEGAL PROCEEDINGS |  |  | 17 |
TRANSFER AGENT |  |  | 17 |
MATERIAL CONTRACTS |  |  | 18 |
INTERESTS OF EXPERTS |  |  | 18 |
ADDITIONAL INFORMATION |  |  | 18 |
APPENDIX I |  |  | 19 |

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STANTEC INC. ANNUAL INFORMATION FORM

FEBRUARY 23, 2012

Caution Regarding Forward-Looking Statements

Our public communications often include written or verbal forward-looking statements within the meaning of the US Private Securities Litigation Reform Act and Canadian securities laws. Forward-looking statements are disclosures regarding possible events, conditions, or results of operations that are based on assumptions about future economic conditions and courses of action and include future-oriented financial information.

Statements of this type are contained and incorporated by reference in this report, including the discussion of our goals in the Core Business and Strategy section and of our annual and long-term targets and expectations for our regions and practice area units in the Results and Outlook sections of our management’s discussion and analysis for the year, ended December 31, 2011, which have been incorporated by reference in this annual information form (as described on page 8), and may be contained in filings with securities regulators or in other communications. Forward-looking statements may involve, but are not limited to, comments with respect to our objectives for 2012 and beyond, our strategies or future actions, our dividend policy, our targets, our expectations for our financial condition or share price, or the results of our outlook for our operations in order to describe the management expectations and targets by which we measure our success and to assist our shareholders in understanding our financial position as at and for the periods ended on the dates presented in this report. Readers are cautioned that this information may not be appropriate for other purposes.

By their nature, forward-looking statements require us to make assumptions and are subject to inherent risks and uncertainties. There is significant risk that predictions, forecasts, conclusions, projections, and other forward-looking statements will not prove to be accurate. We caution readers of this document not to place undue reliance on its forward-looking statements since a number of factors could cause actual future results, conditions, actions, or events to differ materially from the targets, expectations, estimates, or intentions expressed in these forward-looking statements. Assumptions about the performance of the Canadian and US economies in 2012, and how it will affect our business, are material factors we consider in determining our forward-looking statements and are discussed in the Outlook section of our management’s discussion and analysis for the year ended December 31, 2011, filed on www.sedar.com, and incorporated by reference in this annual information form.

For additional information regarding material risks and assumptions, see the discussion on pages M-1 to M-3 of our management’s discussion and analysis for the year ended December 31, 2011, which is incorporated by reference in this annual information form.

We caution that different factors, including those discussed in our management’s discussion and analysis and others, could adversely affect our results. Investors and others should carefully consider these factors, as well as other uncertainties and potential events, and the inherent uncertainty of forward-looking statements. The forward-looking statements contained herein represent our expectations as of February 23, 2012, and, accordingly, are subject to change after such date. Except as may be required by law, we do not undertake to update any forward-looking statement, whether written or verbal, that may be made, from time to time, by us or on our behalf. In the case of the ranges of expected performance for fiscal 2012, it is our current practice to evaluate and, where we deem appropriate, provide updates. However, subject to legal requirements, we may change this practice at any time at our sole discretion.

CORPORATE STRUCTURE

Name, Address, and Incorporation

Stantec Inc. was incorporated under the Canada Business Corporations Act on March 23, 1984, as 131277 Canada Ltd. We have amended our Articles of Incorporation on several occasions, namely to change our Company’s name, amend share attributes, create and delete classes of shares, reorganize our outstanding share capital and split our common shares on a two-for-one basis, and change the minimum and maximum number of directors of our board.

On August 15, 1984, the name 131277 Canada Ltd. was changed to Stanley Engineering Group Inc. and on October 18, 1989, it was changed to Stanley Technology Group Inc. On March 30, 1994, Stanley Technology Group Inc. amalgamated with 3013901 Canada Limited to continue as Stanley Technology Group Inc. On October 28, 1998, the name Stanley Technology Group Inc. was changed to Stantec Inc.

Our head and principal office and our registered and records office are located at 10160 – 112 Street, Edmonton, Alberta, Canada, T5K 2L6.

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References in this annual information form to “Stantec” and the “Company” include, as the context may require, Stantec Inc. and all or some of the companies in which it has an interest collectively or one or more of such companies. References in this annual information form to “our,” “us,” or “we” also refer to “Stantec” in the contexts explained above.

Intercorporate Relationships

The following chart lists, as at December 31, 2011, the intercorporate relationships among Stantec and its subsidiaries; the jurisdiction of incorporation of these companies; and the percentage of voting and restricted securities owned, controlled or directed by Stantec:

STANTEC INC.

SUBSIDIARY |  | PERCENTAGE OF VOTING SHARES |  | PERCENTAGE OF RESTRICTED SHARES* |  | JURISDICTION OF INCORPORATION
58053 Newfoundland & Labrador Inc. |  | 100 |  | n/a |  | Newfoundland and Labrador
59991 Newfoundland & Labrador Ltd. |  | 100 |  | n/a |  | Newfoundland and Labrador
3221969 Nova Scotia Company |  | 100 |  | 100 |  | Nova Scotia
AXYS Environmental Consulting (Barbados) Inc. |  | 100 |  | n/a |  | Barbados
Bonestroo Services, LLC 1 |  | 100 |  | n/a |  | Minnesota
BVE Development, LLC |  | 100 |  | n/a |  | Pennsylvania
International Insurance Group Inc. |  | 100 |  | n/a |  | Barbados
I.R. Wilson Consultants Ltd. |  | 100 |  | n/a |  | British Columbia
Jacques Whitford Consultants BV |  | 100 |  | n/a |  | Netherlands
Jacques Whitford Holdco Ltd. |  | 100 |  | n/a |  | Cayman Islands
Nu Nennè-Stantec Inc. |  | 100 |  | n/a |  | Alberta
RiverMorph, LLC |  | 100 |  | n/a |  | Kentucky
SEA, Incorporated |  | 100 |  | 100 |  | Nevada
Stantec Consulting Caribbean Ltd. |  | 100 |  | n/a |  | Barbados
Stantec Consulting Cayman Islands Ltd. |  | 100 |  | n/a |  | Cayman Islands
Stantec Consulting Colombia S.A.S. |  | 100 |  | n/a |  | Colombia
Stantec Consulting Guatemala, S.A. |  | 100 |  | n/a |  | Guatemala
Stantec Consulting International LLC |  | 100 |  | n/a |  | Arizona
Stantec Consulting International Ltd. |  | 100 |  | 100 |  | Canada
Stantec Consulting Labrador Ltd. |  | 100 |  | n/a |  | Newfoundland and Labrador
Stantec Consulting Ltd. |  | 100 |  | 100 |  | Canada
Stantec Consulting Michigan Inc. |  | 100 |  | n/a |  | Michigan

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SUBSIDIARY |  | PERCENTAGE OF VOTING SHARES |  | PERCENTAGE OF RESTRICTED SHARES* |  | JURISDICTION OF INCORPORATION
Stantec Consulting Panama, S.A. |  | 100 |  | n/a |  | Panama
Stantec Consulting Services Inc. |  | 100 |  | 100 |  | New York
Stantec Delaware II LLC |  | 100 |  | n/a |  | Delaware
Stantec Experts-conseils ltée |  | 100 |  | n/a |  | Canada
Stantec Holdings (Delaware) III Inc. |  | 100 |  | 100 |  | Delaware
Stantec Holdings Ltd. |  | 100 |  | 100 |  | Alberta
Stantec Holdings II Ltd. |  | 100 |  | n/a |  | Alberta
Stantec Newfoundland & Labrador Ltd. |  | 100 |  | n/a |  | Newfoundland and Labrador
Stantec Technology International Inc. |  | 100 |  | 100 |  | Delaware
UEI Associates, Inc. |  | 100 |  | n/a |  | Texas
UEI Global I, Inc. |  | 100 |  | n/a |  | Texas
Universal Energy do Brasil Ltda. |  | 100 |  | n/a |  | Brazil
WilsonMiller, Inc. |  | 100 |  | n/a |  | Florida
WM Aviation, LLC |  | 100 |  | n/a |  | Delaware

* | In the context of this annual information form, “restricted shares” means nonvoting shares in the capital stock of the Company or a subsidiary of the Company, as the case may be.

1 | Acquired as part of the acquisition of Bonestroo, Inc. See the General Development of the Business section below including the Acquisitions section on page 6.

GENERAL DEVELOPMENT OF THE BUSINESS

2012

The following are highlights of the development of our business (or anticipated developments) for the current year

Dividend Declaration

On February 15, 2012, Stantec’s board of directors approved a dividend policy and concurrently declared its first quarterly dividend of $0.15 per share, payable on April 17, 2012, to shareholders of record on March 30, 2012. The declaration of this dividend reflects the confidence of our board of directors and management in our ability to generate ongoing cash flow from operations, continue to grow revenue, and complete strategic acquisitions while providing enhanced shareholder returns.

Three-Year History

The following are highlights of the development of our business over the past three years

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2011

Officer and Director Changes

The following changes occurred in 2011

| • |  | Douglas K. Ammerman and Delores M. Etter were appointed to Stantec’s board of directors on September 1, 2011

| • |  | Effective August 26, 2011, Jeffery Kishel stepped down from his role as practice area unit leader, Environment and left Stantec. Richard K. Allen assumed Mr. Kishel’s role

| • |  | Following the Company’s annual general meeting, distinguished board member Paul Cellucci tendered his resignation from the Company board

| • |  | During Stantec’s annual general meeting on May 12, 2011, chair of the board Ronald Triffo announced the board’s selection of his successor: Aram H. Keith, who has been a board member since 2005

Credit Facility

On September 8, 2011, we announced that we had reached an agreement to amend our existing C$350 million revolving credit facility and extend the maturity date to August 31, 2015. We may obtain access to an additional C$75 million under the same terms and conditions upon approval from our lenders. We will use the credit facility as working capital, for general corporate purposes and for future acquisitions.

Debt Private Placement

On May 13, 2011, Stantec completed the issuance of $70 million in aggregate principal amount of 4.332% senior secured notes due May 10, 2016, and $55 million in aggregate principal amount of 4.757% senior secured notes due May 10, 2018. Stantec used the net proceeds from the notes to refinance existing debt. The notes are ranked equally with Stantec’s obligations under its existing revolving credit facility.

Acquisitions

We acquired a number of firms in Canada and the United States during 2011. The acquisitions completed in 2011 included the following

Date |  | Business Acquired |  | Nature of Business
Oct 2011 |  | ENTRAN, Inc. |  | Provides a range of transportation infrastructure services, including aviation planning and design, bridge design, roadway design, traffic engineering, transportation planning, and construction engineering services, principally located in Lexington, Kentucky, with additional offices in Chicago, Illinois; Cincinnati, Ohio; Charleston, West Virginia; Louisville, Kentucky; and Nashville, Tennessee
Oct 2011 |  | 5107 N.W.T. Limited, operating as FSC Architects & Engineers |  | FSC provides services and expertise within architecture, mechanical, electrical, civil/municipal, structural, and environmental engineering, principally located in Yellowknife, with other additional offices in Whitehorse, Yukon; Iqaluit, Nunavut; and Edmonton, Alberta
Sept 2011 |  | Bonestroo Inc. |  | Provides services in municipal engineering, infrastructure planning, streets and utilities design, water supply, water storage, water distribution, brownfields redevelopment, environmental planning, environmental management, environmental compliance, transportation engineering, traffic engineering, bridge design, water resources management, ice design, aquatics design, athletic field design, land use planning, and urban design, principally located in Minnesota, with additional offices in Wisconsin, Illinois, Michigan and North Dakota

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May 2011 |  | 1488320 Alberta Inc. The Caltech Group |  | Caltech has two distinct business units—Caltech Senex Oil & Gas and Caltech Utilities. Caltech Senex Oil & Gas provides multidisciplinary engineering, procurement, and construction management services, including studies, front-end engineering and development work, detailed engineering, construction management, commissioning, and start-up, as well as operations support. Caltech Utilities has extensive experience in the design of utility, electrical asset, and telecom facilities, which includes a wide range of client planning, engineering, consulting, and development services. Both are principally located in Calgary, Alberta
Feb 2011 |  | QuadraTec Inc. |  | Provides services including mechanical, electrical, industrial, and communication engineering; energy management; design; studies; and contract administration, principally located in Newfoundland and Labrador
2010 |  |
Officer Changes
The following changes occurred in 2010
• Richard K. Allen assumed the senior vice president and chief operating officer role effective January 1, 2010
• Scott L. Murray assumed the role of regional operating unit leader, US East, on January 1, 2010
• Effective July 2, 2010, Robert Youden stepped down from his role as regional operating unit leader, Canada East, and left Stantec. Paul Allen assumed Mr. Youden’s role for the balance of 2010
Credit Facility
In August 2010, we increased the limit of our revolving credit facility from C$300 million to C$350 million and extended its maturity date to August 2013. The agreement also included a provision allowing us to obtain access to an additional C$75 million under the same terms and conditions upon approval from our lenders.
Acquisitions
We acquired a number of firms in Canada and the United States during 2010. The acquisitions completed in 2010 included the following
Date |  | Business Acquired |  | Nature of Business
Dec 2010 |  | Burt Hill, Inc. |  | Provides services in the design of higher education and healthcare facilities from offices, principally located in Pennsylvania, with additional offices in Massachusetts, Arizona, North Carolina, Ohio, Florida, Washington, D.C., the United Arab Emirates, and India
Oct 2010 |  | Street Smarts, Inc./Data Smarts, LLC |  | Provides design services in transportation and civil engineering from offices, principally located in Georgia
Sep 2010 |  | ECO:LOGIC Engineering |  | Provides services in the planning, permitting, design, construction management, and operations of water and wastewater facilities from offices, principally located in California
Sep 2010 |  | Anshen & Allen Architects, Inc. |  | Provides services in the design of healthcare and education facilities from offices, principally located in California, with additional offices in Ohio, Massachusetts, and the United Kingdom
Aug 2010 |  | Communication Arts, Inc. |  | Provides specialized services in project visioning, branding, and associated conceptual architectural and environmental graphics from offices principally located in Colorado

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Date |  | Business Acquired |  | Nature of Business
Jul 2010 |  | Natural Resources Consulting, Inc./ NRC Restorations, LLC |  | Provides services in the areas of wetland, aquatic, and terrestrial ecology; wildlife science; soils science; environmental impact assessment; watershed management; ecosystem restoration design and implementation; and geographic information systems from offices, principally located in Wisconsin
Jul 2010 |  | WilsonMiller, Inc. |  | Provides services for infrastructure, transportation, land management, and environmental projects from offices, principally located in Florida
Jul 2010 |  | IEA Holdings, Inc. |  | Provides engineering and project management services for both traditional and renewable energy projects ranging from cogeneration, coal, and electrical transmission work to the design of wind, waste-to-energy, and biomass systems from offices, principally located in Maine, with additional offices in South Carolina
Apr 2010 |  | TetrES Consultants Inc. |  | Provides environmental management consulting services, principally located in Manitoba
Mar 2010 |  | Project Control Group Inc. |  | Provides project implementation strategy, planning, and controls for complex projects, principally located in Ontario

2009

Officer and Director Changes

The following changes occurred in 2009

• |  | Mark E. Jackson retired from his role as senior vice president and chief operating officer on December 31, 2009, and Richard K. Allen assumed the senior vice president and chief operating officer role effective January 1, 2010

• |  | On September 5, 2009, Jeffrey S. Lloyd stepped down from his position as Secretary & General Counsel and Paul J.D. Alpern assumed the role

• |  | On September 4, 2009, Paul Cellucci was appointed to our board of directors

• |  | Effective May 15, 2009, Robert J. Gomes succeeded Anthony P. Franceschini as our president and chief executive officer

• |  | At the annual general meeting on May 14, 2009, David L. Emerson, PC and Robert J. Gomes were elected to our board of directors, and Robert R. Mesel stepped down from the board

• |  | Daniel J. Lefaivre assumed the senior vice president and chief financial officer role effective January 1, 2009

Acquisitions

We completed the following acquisitions in 2009

Date |  | Business Acquired |  | Nature of Business
Nov 2009 |  | Granary Associates, Inc./Granary Associates Architects, P.C. |  | Provides project management, planning, architecture, and interior design services for healthcare facilities, principally located in Philadelphia and New York
Jan 2009 |  | Jacques Whitford Group Ltd./Jacques Whitford Global Group Limited |  | Provides services in three major areas of practice in environmental sciences, environmental site assessment and remediation, and geotechnical materials and operates primarily in the energy and resources, government, real estate, and finance and insurance sectors, principally located in Canada

For additional information regarding the general development of our business and our strategies for the upcoming year, see pages M-4 to M-13 M-25 to M-29 and M-45 to M-48 of Stantec’s 2011 management’s discussion and analysis incorporated by reference in this annual information form and filed on www.sedar.com.

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DESCRIPTION OF THE BUSINESS

Stantec, founded in 1954, provides professional consulting services in planning, engineering, architecture, interior design, landscape architecture, surveying, environmental sciences, project management, and project economics for infrastructure and facilities projects. Continually striving to balance economic, environmental, and social responsibilities, we are recognized as a world-class leader and innovator in the delivery of sustainable solutions. We support public and private sector clients in a diverse range of markets at every stage, from initial concept and financial feasibility to project completion and beyond.

In simple terms, the world of Stantec is the water we drink, the routes we travel, the buildings we visit, the industries in which we work, and the neighborhoods we call home. Our services are offered through approximately 11,100 employees operating out of more than 170 locations in North America and 4 locations internationally.

For the requirements of International Financial Reporting Standards (IFRS), we have one reportable segment—consulting services.

The following chart illustrates the breakdown of gross revenue for 2011 and 2010 for consulting services:

|  | 2011 |  |  |  |  | 2010 |
Units |  | (C$ millions) |  | % |  |  |  |  | (C$ millions) |  | % |
Consulting Services |  | $1,683.4 |  |  | 100 | % |  |  |  | $1,513.1 |  |  | 100 | %

We use a three-dimensional business model that is built on (1) geographic diversification, (2) practice area units, and (3) provision of services in all phases of a project’s life cycle. This model allows us to manage risk while pursuing our objective of continued revenue and earnings growth. For additional information regarding our core business and strategy, see our 2011 management’s discussion and analysis pages M-4 to M-8, which are incorporated by reference herein.

Research and Development

We generally conduct research and development in the context of a client’s specific project requirements. Most research and development is conducted in the areas of infrastructure evaluation and management systems, hydraulic modeling of water and wastewater systems, pavement evaluation and management systems, and wastewater treatment.

Competitive Conditions

We work in highly competitive markets and have numerous competitors for all the services we offer. The number and identity of competitors vary widely with the type of service we provide. Moreover, for small- to medium-sized projects, we compete with many engineering, architecture, and other professional consulting firms. For larger projects, we have fewer but still many competitors; however, some of these competitors have greater financial and other resources than we do. Although we compete with other large private and public companies in certain geographic locations, our primary competitors are small to mid-sized privately held regional firms in the United States and Canada.

We believe that our operating structure, our operating philosophy, our enterprise systems, and the mix and breadth of our professional services differentiate us from other engineering, architecture, and professional consulting firms.

The principal competitive factors in the services we offer are reputation; experience; breadth and quality of services; technical proficiency; local offices; competitive total project fees; and integrated service delivery. Given the expanding demand for the services we provide, it is likely that additional competitors will emerge. Notwithstanding this increased competition, we believe that we will retain the ability to compete effectively because of our strengths and expertise in engineering, architecture, and related professional services and our track record of service delivery.

We serve many diverse clients in both the private and public sectors. We seek to establish ongoing relationships with clients that are likely to produce repeat business. We are not dependent on any one client or group of clients for our business. No single client or project represents more than five percent of our overall business.

We offer a range of pricing structures to our clients but primarily provide our services based on either a fixed- or variable-fee contract with a ceiling or a time-and-material contract without a stated ceiling. We secure our assignments primarily based on our expertise and contacts and sometimes based on a competitive bidding process.

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Employees

As at December 31, 2011, we had approximately 11,100 staff. This total staff number is comprised of approximately 6,400 professionals, 3,500 technologists and technicians, and 1,200 support personnel.

We are a knowledge-based organization and are always seeking talented and skilled professionals in all our specialist practice areas. Since the supply of qualified candidates is sometimes limited, we use various recruitment strategies to address staffing needs. Examples of our recruitment strategies include our employee referral bonus program, website job postings, career fairs, student programs, and opportunities to transfer to other office locations.

Reorganization

Effective at the end of business on December 31, 2009, Stantec Consulting Inc. (SCI), an Arizona corporation, was merged into its affiliate, Stantec Consulting Services Inc. (SCSI), a New York corporation. Historically, SCSI was our main operating entity for our US East operations, and SCI was our main operating entity for our US West operations. The purpose of the merger was to consolidate the majority of our US operations into one legal entity. We still maintain several special purpose entities to meet licensing requirements in various states; however, the consolidation has assisted in streamlining the provision of services for the majority of our US operations.

In the first quarter of 2010, as part of a long-term strategy, we reorganized our corporate structure, to make it more efficient, which increased our estimated income tax expense by C$6.2 million. The reorganization resulted in a gain for tax purposes; however, this gain did not affect income taxes payable, since it was used to offset previously recognized US income tax losses.

Effective at the close of business on December 31, 2011, Stantec Consulting Corporation (SCC), a Delaware corporation was merged into its affiliate, Stantec Consulting Services Inc. (SCSI), a New York Corporation. SCC was the successor entity of the acquisition of and merger with SECOR International Incorporated in 2008. The purpose of the merger of SCC and SCSI was to further consolidate and streamline our US operations.

Social and Environmental Policies

Stantec’s Health, Safety & Environment (HSE) Program

Stantec is committed to continuous improvement in the area of health and safety in all aspects of its business. Led by our HSE director and managers for both the United States and Canada, the HSE team includes five regional coordinators, more than 100 office coordinators, two dedicated workers’ compensation claims coordinators, and systems and administrative support staff. The program is championed by a senior vice president.

The HSE program’s objective is to eliminate recordable injuries, property loss, and environmental damage by giving employees the necessary guidance and knowledge to complete every task safely, every time. To achieve this objective, the HSE team develops practices and tools that protect employees by not only meeting or exceeding government regulations, but also by striving for best practices.

The foundation of the program is a Hazard Recognition and Control (HRAC) process that enables employees at all levels to establish a healthy and safe work environment. Projects begin with the development of a Risk Management Strategy form that identifies potential risks associated with the project site. Based on these risks, additional controls may be implemented. For example

| • |  | A job safety analysis (JSA) can be completed for identified risks. A JSA breaks down a task into component steps with identification of associated hazards and precautions

| • |  | A site-specific Health and Safety Plan (HASP) may be prepared for each site. All employees, subcontractors, and visitors to applicable sites are required to review and adhere to the health and safety guidelines presented in the HASP

Through these formal strategies, along with regular last-minute risk assessments, the HRAC process empowers employees to proactively identify hazards, assess risks, eliminate or control risks, and stop work if required in order to prevent injury and illness, environmental and property damage, and other types of costly business interruptions.

The HSE team also supports the organization by

| • |  | Maintaining approved health, safety, and environment procedures for many specific work tasks in the form of safe work practices

| • |  | Ensuring quality health, safety, and environment training and education are available

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| • |  | Completing root cause analysis and evaluating lessons learned from recordable injuries and other incidents

| • |  | Coordinating case management following work-related injuries and illnesses

Due to the diversity of the Stantec organization, the HSE team develops core health, safety, and environment standards that can be implemented Company-wide, yet are adaptable to suit the needs of any particular region, client, or project.

Our Company HSE program is outlined in our corporate Health and Safety policy, HSE Program Manual, and Safe Work Practices Guide.

The program is communicated to employees through a comprehensive communications strategy that includes regular features in our Company magazine, ongoing use of the Company’s intranet, eBulletins from senior leadership, office signage, presentations, and workshops. In addition to tracking lagging indicators (workers’ compensation costs and total recordable injury rates), we also track leading indicators such as site visits, file reviews, safety meetings, and worksite inspections to further gauge the effectiveness of the program. The HSE team is able to conduct internal and external audits to assist in not only assuring compliance, but also identifying program strengths and opportunities for improving health and safety performance.

Independent (third party) audits of the HSE program may be conducted as necessary to obtain and maintain external certification (e.g., a Certificate of Recognition). These audits are conducted on a regular basis (often every three years) by an independent auditor. The results of the audits will be documented and brought to the attention of the Joint Health and Safety Committee, regional safety and leadership, and the environment coordinator. The committee will monitor corrective action, address deficiencies found by the audit, and facilitate preventive action if opportunities are identified. Responsibility for corrective and preventive action will be assigned and recorded in a Health and Safety Action Plan.

ISO 14001:2004 Registration

In support of Stantec’s sustainability policy promoting compliance with applicable environmental regulation, and reducing our environmental footprint, we have developed and implemented a formal environmental management system. The environmental management system was recently audited and registered to the ISO 14001:2004 environmental management standard, an internationally recognized standard. Our ISO 14001:2004 registered environmental management system requires leadership to establish environmental performance objectives such as the reduction of energy, resource use, and waste and to formally report on those objectives within an accountable and transparent framework. Stantec received confirmation of registration on January 20, 2012.

Stantec’s Sustainability Policy

Stantec is committed to being a leader and model of sustainability by doing business in a way that meets the needs of the present while contributing to an environmentally, socially, and economically sustainable future. This commitment is at the heart of how Stantec operates and delivers solutions to its clients and is vital to its long-term success in achieving its vision.

Stantec will focus its efforts in the areas where it believes that it can have a significant impact, as follows

Building a leading sustainability consulting practice in the markets it serves by

| • |  | Using its expertise, experience, and influence to advance the sustainability of its valued clients

| • |  | Incorporating sustainability into all its service offerings

| • |  | Marketing and selling sustainable development services across all sectors

Integrating sustainability into its overall operations and everyday practice by

| • |  | Implementing best industry, employee, and vendor practices to reduce resource use, waste, and emissions while increasing efficiency and effectiveness

| • |  | Fostering an understanding of sustainability at all levels of the organization in ways that are both personally and professionally relevant

| • |  | Embracing an accountable and transparent governance and leadership structure that integrates sustainability considerations into all its business decisions

| • |  | Reporting on its sustainability performance and achievements

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Stantec strives to achieve the following

Environmental Progress—Lower its impact on the environment by progressing toward least-impact approaches to resource and energy use, waste, and emissions of carbon and toxins

Social Progress—Engage with stakeholders and support the communities in which it operates

Economic Viability—Demonstrate that its sustainability efforts lead to long-term business vibrancy and viability in concert with its vision, strategic plan, and business objectives

Projects that meet our criteria for being classified as sustainability projects are owned by our Sustainable Development practice. Following this approach is the best way to recognize the multidisciplinary, multisector, and multileadership character of these services and to aggregate project information and revenue data to monitor our success. Building our sustainability services portfolio will in turn make us more competitive to win sustainability work in the future.

International Operations

In 2011 Stantec remained active internationally with gross revenue from international operations of approximately C$58.8 million.

Stantec performs international operations by one of two means. Our first delivery model is to perform work “in country” via our permanent offices located in the United Kingdom, United Arab Emirates, India, Panama, Qatar, and Barbados. Our second delivery model is to manage and support that work from one of our offices located in the United States or Canada.

All project pursuits are subject to a review process whereby the project is reviewed for compliance with Stantec’s legal, financial, and technical processes. In addition each in-country project pursuit is examined to ensure that health and safety and political risk are acceptable. All major projects being pursued are subjected to major project reviews, where applicable and all projects have an executive leadership sponsor.

Dividend Policy

On February 15, 2012, Stantec’s board of directors declared its first quarterly dividend of $0.15 per share, payable on April 17, 2012, to shareholders of record on March 30, 2012. The dividend policy adopted at that time by the board of directors states that Stantec expects to declare and pay a dividend on a quarterly basis. The dividend policy may be changed from time to time in the sole discretion of the board of directors. Accordingly, there can be no assurances as to the amount or timing of any dividend in the future. In assessing whether to pay a dividend and in determining the amount of the dividend, the board of directors will consider Stantec’s financial performance and its then current business needs. The adoption of a dividend policy and declaration of a dividend reflects the confidence of our board of directors and management in our ability to generate ongoing cash flow from operations, continue to grow revenue, and complete strategic acquisitions while providing enhanced shareholder returns.

RISK FACTORS

For a review of the risks pertaining to our Company, refer to our 2011 management’s discussion and analysis, pages M-61 to M-72, which is filed on SEDAR at www.sedar.com and incorporated by reference herein.

DESCRIPTION OF CAPITAL STRUCTURE

Our authorized share capital consists of an unlimited number of preferred shares, issuable in series, and an unlimited number of common shares, of which, at December 31, 2011, no preferred shares and 45,523,585 common shares were issued and are outstanding.

Preferred Shares

The preferred shares may be issued in one or more series, with each series to consist of such number of shares and to have such rights, privileges, restrictions, and conditions as may, before the issue thereof, be determined by our board of directors. The holders of the preferred shares as a class are not entitled to receive notice of or to attend any meeting of our shareholders and are not entitled to vote at any such meeting, except to approve amendments to the terms of the preferred shares as a class or as required by law. Each series of preferred shares will rank pari passu with each other series of preferred shares with respect to the entitlement to dividends or distribution of assets in the event of the liquidation, dissolution, or winding up of Stantec. The preferred shares as a class rank ahead of the common shares with respect to entitlement to dividends and distribution of assets in the event of the liquidation, dissolution, or winding up of Stantec.

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Common Shares

The holders of common shares are entitled to receive, as and when declared by our board of directors, dividends in such amount and in such form as our board of directors may from time to time determine. The holders of the common shares are entitled to receive notice of and to attend all meetings of our shareholders and have one vote for each common share held at all such meetings, except for meetings at which only holders of another specified class or series of our shares are entitled to vote separately as a class or series. The common shares rank behind the preferred shares with respect to entitlement to dividends and distribution of assets in the event of the liquidation, dissolution, or winding up of Stantec.

MARKET FOR SECURITIES

Trading Price and Volume

Our common shares are listed for trading on the Toronto Stock Exchange (TSX) and New York Stock Exchange (NYSE) under the symbol STN. The intraday trading information on the TSX for the period from January 1, 2011, to December 31, 2011, is set out in the following table:

Month |  | High |  |  | Low |  |  | Volume |
January |  |  | $29.61 |  |  |  | $27.31 |  |  |  | 4,688,407 |
February |  |  | $30.00 |  |  |  | $27.41 |  |  |  | 3,310,524 |
March |  |  | $29.48 |  |  |  | $26.86 |  |  |  | 6,228,606 |
April |  |  | $30.33 |  |  |  | $28.85 |  |  |  | 2,892,310 |
May |  |  | $30.17 |  |  |  | $28.44 |  |  |  | 1,756,484 |
June |  |  | $29.75 |  |  |  | $26.85 |  |  |  | 2,390,256 |
July |  |  | $28.88 |  |  |  | $26.92 |  |  |  | 2,038,022 |
August |  |  | $27.21 |  |  |  | $22.00 |  |  |  | 4,797,270 |
September |  |  | $24.51 |  |  |  | $21.50 |  |  |  | 3,101,652 |
October |  |  | $25.78 |  |  |  | $22.26 |  |  |  | 3,347,800 |
November |  |  | $26.67 |  |  |  | $22.88 |  |  |  | 2,853,556 |
December |  |  | $27.96 |  |  |  | $25.81 |  |  |  | 2,261,465 |
|  |  |  |  |  |  |  |  |  |  | 39,666,352 |

The intraday trading information on the NYSE for the period from January 1, 2011, to December 31, 2011, is set out in the following table:

Month |  | High |  |  | Low |  |  | Volume |
January |  |  | $29.85 |  |  |  | $27.55 |  |  |  | 350,371 |
February |  |  | $30.41 |  |  |  | $27.91 |  |  |  | 320,641 |
March |  |  | $30.36 |  |  |  | $27.20 |  |  |  | 277,596 |
April |  |  | $31.89 |  |  |  | $29.84 |  |  |  | 254,269 |
May |  |  | $31.58 |  |  |  | $29.04 |  |  |  | 175,232 |
June |  |  | $30.63 |  |  |  | $27.34 |  |  |  | 394,056 |
July |  |  | $28.32 |  |  |  | $28.32 |  |  |  | 179,961 |
August |  |  | $28.84 |  |  |  | $22.12 |  |  |  | 336,693 |
September |  |  | $25.08 |  |  |  | $20.96 |  |  |  | 285,741 |
October |  |  | $25.94 |  |  |  | $21.09 |  |  |  | 182,682 |
November |  |  | $26.14 |  |  |  | $22.56 |  |  |  | 172,701 |
December |  |  | $27.44 |  |  |  | $25.08 |  |  |  | 144,819 |
|  |  |  |  |  |  |  |  |  |  | 3,074,762 |

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Prior Sales

On May 13, 2011, we issued $70 million of 4.332% senior secured notes due May 10, 2016, and $55 million of 4.757% senior secured notes due May 10, 2018. These amounts were recorded net of transaction costs of $1.1 million. The senior secured notes were issued pursuant to an indenture dated May 13, 2011, between Stantec Inc., as issuer, and BNY Trust Company of Canada, as trustee. The senior secured notes are ranked equally with our existing revolving credit facility. Interest on the senior secured notes is payable semi-annually in arrears on May 10 and November 10 each year commencing on November 10, 2011, until maturity or the earlier payment, redemption, or purchase in full of the senior secured notes.

DIRECTORS AND OFFICERS

The following table lists the directors of Stantec Inc., current to February 23, 2012, their municipality of residence, and their principal occupation within the five preceding years:

Directors of Stantec

Name and Municipality of Residence |  | Principal Occupation |  | Director Since
DOUGLAS K. AMMERMAN 2 Laguna Beach, California, United States |  | Corporate Director |  | 2011
ROBERT J. BRADSHAW 2 Toronto, Ontario, Canada |  | Corporate Director |  | 1993
DAVID L. EMERSON 2 Vancouver, British Columbia, Canada |  | Corporate Director and Public Policy Advisor |  | 2009
DELORES M. ETTER 1 Dallas, Texas, United States |  | Professor of Electrical/Computer Engineering |  | 2011
ANTHONY P. FRANCESCHINI Edmonton, Alberta, Canada |  | Corporate Director |  | 1994
ROBERT J. GOMES Edmonton, Alberta, Canada |  | President & CEO of Stantec |  | 2009
SUSAN E. HARTMAN 1 Evergreen, Colorado, United States |  | President and CEO of The Hartman Group (a management consulting firm) |  | 2004
ARAM H. KEITH Irvine, California, United States |  | Corporate Director |  | 2005
IVOR M. RUSTE 1,2 Calgary, Alberta, Canada |  | Executive Vice President and Chief Financial Officer, Cenovus Energy Inc. (a Canadian oil company) |  | 2007

1 | Member of the Corporate Governance and Compensation Committee

2 | Member of the Audit and Risk Committee

All directors are elected annually. Douglas K. Ammerman, Susan E. Hartman and Aram Keith have been engaged for more than five years in their current principal occupation. Ivor M. Ruste is currently executive vice president and chief financial officer of Cenovus Energy Inc. During the period from May 2006 to November 2009, he worked with Encana Corporation as executive vice president, corporate responsibility & chief risk officer. From 1998 to May 2006, he was the managing partner of the Edmonton office of KPMG LLP (an international audit, tax, and advisory services firm). Prior to his retirement in 2009, Robert J. Bradshaw was the chairman of Contor Industries (a holding company that acquires manufacturing companies). David L. Emerson was a member of Parliament for Vancouver Kingsway from July 2004 to 2008. From November 2008 to November 2009, Mr. Emerson was a senior advisor with the law firm of Farris, Vaughan LLP. Anthony Franceschini was Stantec’s president and chief executive officer until May 14, 2009. Prior to May 15, 2009, Robert J. Gomes was senior vice president of certain Stantec Inc. subsidiaries. Since November of 2007, Delores Etter’s principal occupation has been Professor of Electrical/Computer Engineering.

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From November of 2005 to November of 2007, Ms. Etter’s occupation was Assistant Secretary of the Navy for Research, Development and Acquisitions.

The following table lists the executive officers of Stantec, current to February 23, 2012, their municipality of residence, and their principal occupation within the five preceding years:

Nonexecutive and Executive Officers of Stantec

Name and Municipality of Residence |  | Principal Occupation |  | Officer Positions Held
Nonexecutive Officers of Stantec Inc. |  |  |  |
ARAM H. KEITH Irvine, California, United States |  | Chair of the Board |  | Chair of the Board of Stantec Inc.
Executive Officers of Stantec Inc. |  |  |  |
ROBERT J. GOMES Edmonton, Alberta, Canada |  | President & CEO |  | President & CEO of Stantec Inc.
DANIEL J. LEFAIVRE St. Albert, Alberta, Canada |  | Senior Vice President & CFO |  | Senior Vice President & CFO of Stantec Inc.
RICHARD K. ALLEN Canton, Massachusetts, United States |  | Senior Vice President & COO |  | Senior Vice President & COO of Stantec Inc.; Interim Practice Area Unit Leader, Environment
PAUL J.D. ALPERN Edmonton, Alberta, Canada |  | Vice President, Secretary & General Counsel |  | Vice President, Secretary & General Counsel of Stantec Inc. and Vice President and Corporate Counsel of certain Stantec Inc. subsidiaries
Other Executive Officers |  |  |  |
W. PAUL ALLEN Elmira, Ontario, Canada |  | Practice Area Unit Leader, Urban Land, and Regional Operating Unit Leader, Canada East |  | Senior Vice President of certain Stantec Inc. subsidiaries
DONALD R. BELLIVEAU Fredericton, New Brunswick, Canada |  | Practice Area Unit Leader, Industrial |  | Senior Vice President of certain Stantec Inc. subsidiaries
CARL F. CLAYTON Edmonton, Alberta, Canada |  | Practice Area Unit Leader, Transportation, Regional Operating Unit Leader, International |  | Senior Vice President of certain Stantec Inc. subsidiaries
VALENTINO DIMANNO Calgary, Alberta, Canada |  | Regional Operating Unit Leader, Canada West |  | Senior Vice President of certain Stantec Inc. subsidiaries
SCOTT L. MURRAY Lexington, Kentucky, United States |  | Regional Operating Unit Leader, US East |  | Senior Vice President of certain Stantec Inc. subsidiaries
ERIC C. NIELSEN Santa Ana, California, United States |  | Regional Operating Unit Leader, US West, Practice Area Unit Leader for Urban Land |  | Senior Vice President of certain Stantec Inc. subsidiaries

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Name and Municipality of Residence |  | Principal Occupation |  | Officer Positions Held
STANIS I.R. SMITH Burnaby, British Columbia, Canada |  | Practice Area Unit Leader, Buildings |  | Senior Vice President of certain Stantec Inc. subsidiaries

All the above executive officers have held their present position or other positions with Stantec for the past five years, except for Daniel J. Lefaivre, who, prior to January 1, 2009, was Stantec’s vice president, Finance & Treasury; Richard K. Allen, who, prior to April 17, 2006, was president and chief executive officer of Dufresne-Henry, Inc. and who following August 26, 2011, became Interim Practice Area Unit Leader, Environment; Paul Allen, who, prior to July 1, 2010, was Stantec’s corporate practice area unit leader, Urban Land, and following July 1, 2010, also became Stantec’s regional operating unit leader, Canada East; and Scott Murray, who, prior to January 1, 2008, was an owner and vice president of Fuller, Mossbarger, Scott & May Engineers, Inc., and during the period of January 1, 2008, through December 31, 2009, was Stantec’s regional leader for the US South. As a group, our directors and officers beneficially owned, controlled, or directed, directly or indirectly, 753,133 common shares representing 1.65 percent of our issued and outstanding common shares.

AUDIT AND RISK COMMITTEE INFORMATION

Audit and Risk Committee Terms of Reference

The responsibilities and duties of our Audit and Risk Committee are set out in the committee’s Terms of Reference, the text of which is attached as Appendix I to this annual information form.

Composition of the Audit and Risk Committee

Our Audit and Risk Committee is made up of the following four members: Ivor Ruste (chair), Douglas Ammerman, Robert Bradshaw, and David Emerson.

The board of directors believes that the composition of the Audit and Risk Committee reflects an appropriate level of financial literacy and expertise. Each member of the Audit and Risk Committee has been determined by the board to be “independent” and “financially literate” as such terms are defined under applicable Canadian and US securities laws. In addition, Mr. Ruste, Mr. Ammerman and Mr. Emerson are identified as “Audit Committee Financial Experts” as such term is defined in the rules and regulations of the U.S. Securities and Exchange Commission (SEC). The following is a description of the education and experience of each member of the committee that are relevant to the performance of his or her committee responsibilities.

Ivor M. Ruste is currently executive vice president and chief financial officer for Cenovus Energy Inc. headquartered in Calgary. He has a bachelor of commerce degree (with distinction) from the University of Alberta and is a Fellow Chartered Accountant. During the period from May 2006 to November 2009, he worked for EnCana Corporation and, prior to joining Cenovus, was executive vice president, corporate responsibility & chief risk officer at EnCana. From 1998 to 2006, he was the managing partner of the Edmonton office of KPMG LLP (an international audit, tax, and advisory services firm) and the Alberta regional managing partner and vice chair of the KPMG Canada Board of Directors. As a chartered accountant with 26 years of experience working as an auditor of both public and private companies, Mr. Ruste has reviewed and audited many complex financial statements and prepared interim and annual financial statements in accordance with both Canadian and US generally accepted accounting standards. Over the past 30 years, Mr. Ruste has been involved in numerous other business, community, and professional activities. As of December 31, 2011, he owned 2,500 common shares valued at $68,925 and 16,000 deferred share units valued at $434,240.

Douglas K. Ammerman is a retired partner with KPMG. Mr. Ammerman was with KPMG for almost 30 years, and during that time he served as the national practice partner, the managing partner of the Orange County office, and as a member of KPMG’s nominating committee for its board of directors. He holds a master’s degree in business taxation degree from the University of Southern California, as well as a bachelor of arts degree with an accounting emphasis from California State University at Fullerton. Mr. Ammerman is past president of the Pacific Club and director emeritus and served in the Reagan administration as Special Assistant to the Secretary of Interior. He currently serves on the board of directors of Fidelity National Financial, Quiksilver, William Lyon Homes, and El Pollo Loco, and serves on the advisory board of governors for the Balboa Bay Club. As of December 31, 2011, he owned 1,900 common shares valued at $52,383 and 1,600 deferred share units valued at $43,424.

Robert J. Bradshaw is a professional engineer with a diverse background in the manufacturing, oil, consulting engineering, and nuclear industries, as well as in power generation and government service. Mr. Bradshaw is currently retired and is a corporate director for one additional company

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and one charity. In addition to Mr. Bradshaw’s experiences in diverse industries as an engineer, he also has 25 years of experience in acquiring companies for turnaround purposes. In that context, Mr. Bradshaw reviewed and analyzed the financial statements of those companies, as well as their financial procedures. Mr. Bradshaw has also taken university accounting courses to further supplement his knowledge. As of December 31, 2011, he owned 110,000 common shares valued at $3,032,700 and 27,200 deferred share units valued at $738,208.

David L. Emerson, PC, OBC is a corporate director, public policy advisor, and senior advisor to CAI Managers, a private equity fund. Nationally, he has held senior positions with the Government of Canada, including the positions of Minister of Foreign Affairs, Minister of International Trade with responsibility for the Asia Pacific Gateway Initiative and the 2010 Vancouver Olympics, and Minister of Industry. In British Columbia, Mr. Emerson was the Province’s Deputy Minister of Finance, Secretary to Treasury Board, Deputy Minister to the Premier and Secretary to Cabinet. His leadership roles in the private sector included: president and CEO of Canfor Corporation, president and CEO of the Vancouver International Airport Authority, and chairman and CEO of Canadian Western Bank. Mr. Emerson is currently board chair of TimberWest Forest Corporation and serves on the board of directors of Finning International Inc. and Postmedia Network Inc. In addition, Mr. Emerson is co-chair, Prime Minister’s Advisory Committee on the Public Service, and a member of China Investment Corporation International Advisory Council. Mr. Emerson is a recipient of the Order of British Columbia and the Peter Lougheed Award of Excellence in Public Policy. Mr. Emerson holds bachelor’s and master’s degrees in economics from the University of Alberta and a doctorate in Economics from Queen’s University. His education and experience have provided him with a breadth of knowledge regarding complex accounting issues. As of December 31, 2011, he owned 5,000 common shares valued at $137,850 and 8,800 deferred share units valued at $238,832.

Preapproval Policy

The Audit and Risk Committee must preapprove the audit and nonaudit services performed by the independent auditor in order to ensure that the provision of such services does not impair the auditor’s independence. Unless a type of service to be provided by the independent auditor has received general preapproval, it will require specific preapproval by the Audit and Risk Committee. Any proposed services exceeding preapproved cost levels will require specific preapproval by the Audit and Risk Committee.

External Auditor Service Fees

Aggregate fees paid to Ernst & Young LLP, our external auditor, during the fiscal years ended December 31, 2011, and 2010, were as follows:

Category |  | Note |  |  |  | 2011 |  |  | 2010 |
Audit Fees |  | 1 |  |  |  | C$ | 1,104,000 |  |  | C$ | 1,075,000 |
Audit-Related Fees |  | 2 |  |  |  |  | 169,000 |  |  |  | 574,000 |
Tax Fees |  | 3 |  |  |  |  | 807,000 |  |  |  | 628,000 |
Total |  |  |  |  |  | C$ | 2,080,000 |  |  | C$ | 2,277,000 |

1 Audit Fees—Audit services provided by Ernst & Young LLP for the audit and review of Stantec’s financial statements or services normally provided by Ernst & Young LLP in connection with statutory and regulatory filings or engagements

2 Audit-Related Fees—Assurance and related services provided by Ernst & Young LLP that are reasonably related to the performance of the audit or review of the financial statements and are not reported under “Audit Fees”

3 Tax Fees—Professional services rendered by Ernst & Young LLP for tax compliance, tax advice, and tax planning, including tax advice relating to potential business acquisitions

LEGAL PROCEEDINGS

We have legal claims and suits pending, both by and against us. These are typical to the industries in which we operate. Where appropriate, these claims have been reported to our insurers and the insurers of our predecessors’, who are in the process of adjusting and/or defending them. None are expected to have a material effect on our financial position.

TRANSFER AGENT

Computershare Trust Company of Canada is our transfer agent at its offices in Calgary, Alberta; Toronto, Ontario; and Canton, Massachusetts.

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MATERIAL CONTRACTS

We did not enter into any material contracts outside the ordinary course of business in 2011. We consider the acquisition of professional services firms to be in the ordinary course of our business.

INTERESTS OF EXPERTS

Ernst & Young LLP, Chartered Accountants, located at 10020 – 100 th Street, Suite 2200, Edmonton, Alberta, are the Company’s auditors.

The Company’s auditors, Ernst & Young LLP, are independent in accordance with the Rules of Professional Conduct of the Institute of Chartered Accountants of Alberta and have complied with the SEC’s rules on auditor independence.

ADDITIONAL INFORMATION

Financial information is provided in our consolidated financial statements and management’s discussion and analysis for our most recently completed financial year. Additional information, including directors’ and officers’ remuneration and indebtedness, the principal holders of our securities, and securities authorized for issuance under equity compensation plans, will be contained in our management information circular. Copies of this annual information form, as well as our latest management information circular and financial review (which includes our consolidated financial statements and management’s discussion and analysis for the year ended December 31, 2011), may be obtained from our website at www.stantec.com or by mail on request from the secretary at 10160 – 112 Street, Edmonton, Alberta, T5K 2L6. Disclosure documents and any reports, statements, or other information that we file with Canadian provincial securities commissions or other similar regulatory authorities, are also available through SEDAR at www.sedar.com.

NYSE CORPORATE GOVERNANCE DISCLOSURE

As a foreign private issuer listed on the NYSE, we are generally entitled to follow the Canadian requirements, including the rules of National Instrument 58-101 and National Policy 58-201, with respect to corporate governance practices. We are required, pursuant to Section 303A.11 of the NYSE’s Listed Company Manual, to identify any significant ways in which our corporate governance practices differ from those followed by US domestic companies under NYSE listing standards. These differences can be found on our website at www.stantec.com.

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APPENDIX I

Stantec Inc.

Audit and Risk Committee-Terms of Reference (Mandate)

| A. | Overview and Purpose

The Audit and Risk Committee is appointed by, and responsible to, the Board of Directors. The committee approves, monitors, evaluates, advises, and makes recommendations, in accordance with these terms of reference, on matters affecting the external and internal audits, risk management matters, the integrity of financial reporting, and the accounting control policies and practices of the corporation. The involvement of the committee in overseeing the financial reporting process, including assessing the reasonableness of management’s accounting judgments and estimates and reviewing key filings with regulatory agencies is an important element of the Company’s internal control over financial reporting. The committee has oversight responsibility for the performance of both the internal auditors and the external auditors. The committee also ensures the qualifications and independence of the external auditors. The committee has oversight of the corporation’s compliance with legal and regulatory requirements.

It is not the duty of the committee to plan or conduct audits or to determine that the corporation’s financial statements are complete, accurate, and in accordance with International Financial Reporting Standards.

| B. | Authority and Responsibilities

The Audit and Risk Committee shall:

| a. | Request such information and explanations in regard to the accounts of the corporation as the committee may consider necessary and appropriate to carry out its duties and responsibilities.

| b. | Consider any other matters which, in the opinion of the committee or at the request of the board, would assist the directors to meet their responsibilities.

| c. | Provide reports and minutes of meetings to the board.

| d. | Engage independent counsel and other advisors as may be deemed or considered necessary and determine the fees of such counsel and advisors. Receive confirmation from management that the corporation has provided for adequate funding for the payment of compensation to the independent counsel and other advisors.

C. Membership |

The members of the committee shall be composed of a minimum of three independent directors, appointed by the board, all of whom must be financially literate as defined under the rules of the SEC and the New York Stock Exchange (NYSE) and applicable Canadian securities laws. At least one member shall have accounting or related financial management expertise and be an audit committee financial expert as defined in SEC regulations. For greater clarity, the board has adopted the definition of independent director as set out in Multilateral Instrument 52-110 of the Canadian Securities Administrators. The chair of the board of directors shall be an ex-officio member of the Audit and Risk Committee, in addition to the minimum number of required independent directors.

The chair of the committee shall be designated by the board.

Attendance by invitation at all or a portion of committee meetings is determined by the committee chair or its members and would normally include the chief financial officer of the corporation, representatives of the external auditor, the internal auditor, and such other officers or support staff as may be deemed appropriate.

D. Financial | Statements and Disclosures

| 1. | Review, and recommend to the board for approval, the annual audited financial statements and management discussion and analysis.

| 2. | Review, and recommend to the board for approval, the following public disclosure documents:

(a) The annual management information circular and proxy materials

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| (b) | The annual information form, including any regulatory requirements for audit and risk committee reporting obligations

| (c) | The year-end news release on the earnings of the corporation

| (d) | Other regulatory filings of a financial nature

| 3. | Review and, if appropriate, approve and authorize the release of the quarterly unaudited financial statements including management’s discussion and analysis, the quarterly interim report to shareholders, and the quarterly press release on the earnings of the corporation. However, in the event that there is a significant or extraordinary matter that, in the opinion of the committee, should be reviewed by the board before the release of such information, the matter shall be referred to the board for review.

| 4. | Receive quarterly report from the disclosure committee on the adequacy of disclosure with respect to material events in the corporation’s financial statements, management’s discussion and analysis, and earnings press releases.

| 5. | Receive annually an evaluation from the internal auditor of the procedures that exist for the review of financial information (extracted or derived from financial statements) that is publicly disclosed by the corporation.

| 6. | Review, and recommend to the board for approval, all annual financial statements, reports of a financial nature (other than quarterly unaudited financial statements), and the financial content of prospectuses or any other reports that require approval by the board prior to submission thereof to any regulatory authority.

| 7. | Review the Audit and Risk Committee information required as part of the annual information form.

| 8. | Review with management on an annual basis, the corporation’s obligations pursuant to guarantees (including those granted under the Surety Credit Facility) that have been issued and material obligations that have been entered into and the manner in which these guarantees and obligations have been, or should be, disclosed in the financial statements.

| 9. | Review and assess, in conjunction with management and the external auditor, at least annually or on a quarterly basis where appropriate or required:

| (a) | The appropriateness of accounting policies and financial reporting practices used by the corporation, including alternative treatments that are available for consideration

| (b) | Any significant proposed changes in financial reporting and accounting policies and practices to be adopted by the corporation

| (c) | Any new or pending developments in accounting and reporting standards that may affect or impact on the corporation

| (d) | Any off-balance sheet structures

| (e) | The key estimates and judgments of management that may be material to the financial reporting of the corporation

| 10. | At least annually, request the external auditor to provide their views on the quality (not just the acceptability) of the corporation’s annual and interim financial reporting. Such quality assessment should encompass judgments about the appropriateness, aggressiveness, or conservatism of estimates and elective accounting principles or methods and judgments about the clarity of disclosures.

| 11. | Review any litigation, claim, or other contingency, including tax assessments, that could have a material effect upon the financial position or operating results of the corporation and the manner in which these matters have been disclosed in the financial statements.

| 12. | Review with management on a quarterly basis, the indicators of impairment to the corporation’s goodwill.

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E. | External Auditor

| 13. | Assess the performance and consider the annual appointment of an external auditor for recommendation to the board for ultimate recommendation for appointment by the shareholders.

| 14. | Review, approve, and execute the annual engagement letter with the external auditor and ensure that there is a clear understanding between the board, the committee, the external auditor, and management that the external auditor reports directly to the shareholders and the board through the committee. The terms of the engagement letter or the annual audit plan should include, but not be limited to, the following:

| (a) | Staffing

| (b) | Objectives and scope of the external audit work

| (c) | Materiality limits

| (d) | Audit reports required

| (e) | Areas of audit risk

| (f) | Timetable

| (g) | The proposed fees

| 15. | Obtain and review a report from the external auditor at least annually regarding the auditor’s independence and the profession’s or audit firm’s requirements regarding audit partner rotation.

| 16. | Approve, before the fact, the engagement of the external auditor for all nonaudit services and the fees for such services and consider the impact on the independence of the external audit work of fees for such nonaudit services.

| 17. | Review all fees paid to the external auditor for audit services and, if appropriate, recommend their approval to the board. Receive confirmation from management that the corporation has provided for adequate funding for the payment of compensation to the external auditor.

| 18. | Receive an annual certification from the external auditor that they participate in the public oversight program established by the Canadian Public Accountability Board (CPAB) and the standards of the United States Public Company Accounting Board (PCAOB) and that they are in good standing with the CPAB and the PCAOB.

| 19. | Review a report from the external auditors describing (a) the firm’s internal quality control procedures and (b) any material issues raised by the most recent internal quality control review or peer review of the firm or by any inquiry or investigation by governmental or professional authorities within the preceding five years regarding the audits carried out by the external auditor together with any steps taken to deal with any such issues.

| 20. | Receive and resolve any disagreements between management and the external auditor regarding all aspects of the corporation’s financial reporting.

| 21. | Review with the external auditor the results of the annual audit examination including, but not limited to, the following:

| (a) | Any difficulties encountered, or restrictions imposed by management, during the annual audit

| (b) | Any significant accounting or financial reporting issues

| (c) | The auditor’s evaluation of the corporation’s internal controls over financial reporting and management’s evaluation thereon, including internal control deficiencies identified by the auditor that have not been previously reported to the committee

| (d) | The auditor’s evaluation of the selection and application of accounting principles and estimates and the presentation of disclosures

| (e) | The postaudit or management letter or other material written communications containing any findings or recommendations of the external auditor including management’s response thereto and the subsequent follow-up to any identified internal accounting control weaknesses

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| (f) | Any other matters which the external auditor should bring to the attention of the committee

| 22. | Meet with the external auditor at every meeting of the committee or as requested by the auditor, without management representatives present, and meet with management, at least annually or as requested by management, without the external auditor present.

| 23. | When there is to be a change in the external auditor, review all issues related to the change, including the information to be included in the notice of change of auditor called for under National Instrument 51-102 and the planned steps for an orderly transition.

| 24. | Review and approve the corporation’s hiring policies regarding employees and former employees of the present and former external auditors of the corporation.

| 25. | Receive comments from the external auditor on their assessment of the effectiveness of the committee’s oversight of internal control over financial reporting.

F. | Internal Audit

| 26. | Review the appointment or termination of the internal auditor.

| 27. | Review and approve the internal audit charter periodically (at least every three years).

| 28. | Review and approve the annual audit plan of the internal auditor (where applicable) and ensure that there is a clear understanding between the board, the committee, the internal auditor, and management that the internal auditor reports directly to the board through the committee. Receive confirmation from management that the corporation has provided for adequate funding for the internal auditor. The terms of the audit plan should include, but not be limited to, the following:

| (a) | Staffing

| (b) | Objectives and scope of the internal audit work

| (c) | Materiality limits

| (d) | Audit reports required

| (e) | Areas of audit risk

| (f) | Timetable

| (g) | The proposed budget

| 29. | Review with the internal auditor the results of their audit examination, including, but not be limited to, the following:

| (a) | Any difficulties encountered, or restrictions imposed by management, during the audit

| (b) | Any significant accounting or financial reporting issues

| (c) | The auditor’s evaluation of the corporation’s system of internal accounting controls, procedures, and documentation

| (d) | The internal audit reports or other material written communications containing any findings or recommendations of the internal auditor, including management’s response thereto and the subsequent follow-up to any identified internal accounting control weaknesses

| (e) | Any other matters which the internal auditor should bring to the attention of the committee

| 30. | Meet with the internal auditor at every meeting of the committee or as requested by the internal auditor, without management representatives present.

G. | Internal Controls

| 31. | Obtain reasonable assurance, through discussions with and reports from management, the external auditor, and the internal auditors, that the accounting systems are reliable, the system for preparation of financial data reported to the market is adequate and effective, and the system of internal controls is effectively designed and implemented.

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| 32. | Review management’s annual report on the effectiveness of internal controls and procedures, as well as quarterly and annual chief executive officer and chief financial officer certificates filed pursuant to securities regulations.

| 33. | Receive reports from management and/or the internal auditor on all significant deficiencies and material weaknesses identified.

| 34. | Review annually, or as required, the appropriateness of the system of internal controls and approval policies and practices concerning the expenses of the officers of the Corporation, including the use of its assets.

| 35. | Review and approve, on a quarterly after-the-fact basis, the expense accounts of the board chair and of the chief executive officer of the corporation.

H. | Risk

General

| 36. | Review at least annually with Management:

| (a) | the Corporation’s method of identifying, evaluating, mitigating and reporting on the principal risks inherent in the Corporation’s businesses and strategic directions;

| (b) | the systems, policies and practices applicable to the Corporation’s assessment, management, prevention and mitigation of risks (including strategic, operating, compliance, reputation as well as financial risks including but not limited to the foreign currency, liquidity and interest rate risk, the use of derivative instruments, counterparty credit exposure, litigation and adequacy of tax provisions); and

| (c) | the Corporation’s risk appetite, risk tolerance and risk retention philosophy, including the Corporation’s loss prevention policies and insurance programs and corporate liability protection programs for Directors and officers, as well as disaster response and business continuity plans.

| 37. | Receive quarterly reports from and review with Management, the status of the Corporation’s principal and emerging risks, and the related mitigation programs.

| 38. | Review with Management the disclosures of the Corporation’s risks and risk factors in the Corporation’s annual information form, the MD&A and other regulatory filings.

| 39. | Report to the Board quarterly on its activities in connection with the risk oversight role referenced herein so that the Board as a whole can fulfill its responsibilities for risk oversight.

| 40. | Receive a risk assessment report from management following due diligence on acquisitions within North America with an enterprise value of $40 million (Canadian or US dollars) or greater and all acquisitions outside North America, make such further inquiries as considered necessary, and report thereon to the board. The content of the risk assessment report will be initially developed by the committee in conjunction with management and will be reviewed annually by the committee.

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Finance

| 41. | Review and assess, in conjunction with management and the external auditor, at least annually or on a quarterly basis where appropriate or required, the impact of the corporation’s capital structure on current and future profitability.

| 42. | Review and recommend to the board of directors proposals requesting a grant of a guarantee issued by Stantec for an amount in excess of $5 million, prior to issuance.

| 43. | Review and recommend to the board of directors proposals requesting a grant of a surety bond issued by Stantec or its subsidiaries for: (a) an amount in excess of $5 million individually or (b) where by virtue of the grant of such surety bond would put the aggregate value of all surety bonds issued and outstanding in excess of $50 million, prior to issuance.

I. Compliance/Fraud

| 44. | Receive quarterly reports on the corporation’s fraud risk assessment activities.

| 45. | In accordance with the corporation’s integrity practices, review and determine the disposition of any complaints or correspondence received under the policy.

| 46. | Consider annually whether the Corporation should make use of an external integrity hotline.

| 47. | Discuss with management the corporation’s policies and procedures designed to ensure an effective compliance and ethics program, including the corporation’s code of ethics.

| 48. | Discuss with management and the corporation’s in-house legal counsel any legal matters that may have a material impact on the financial statements or the corporation’s compliance requirements.

| 49. | Review quarterly, the compliance certificate of the chief financial officer.

J. Other

| 50. | Review, as required, any claims of indemnification pursuant to the bylaws of the corporation.

| 51. | Receive a quarterly report from the chief financial officer regarding private aircraft use, including itinerary and passenger manifest.

| 52. | Review and determine the disposition of any complaints received from shareholders or any regulatory body.

| 53. | Conduct an annual assessment of the effectiveness of the committee and provide a report thereon to the board.

| 54. | Review annually the terms of reference for the committee and recommend any required changes to the board.

K. Meetings

| 55. | Regular meetings of the committee are held at least four times each year.

| 56. | Meetings may be called by the committee chair or by a majority of the committee members, usually in consultation with management of the corporation.

| 57. | Meetings are chaired by the committee chair or, in the chair’s absence, by a member chosen from among the committee.

| 58. | A quorum for the transaction of business at any meeting of the committee is a majority of the appointed members.

| 59. | The secretary of the corporation shall provide for the delivery of notices, agendas, and supporting materials to the committee members at least five (5) days prior to the meeting except in unusual circumstances.

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| 60. | Meetings may be conducted with members present or by telephone or other communications facilities that permit all persons participating in the meeting to hear or communicate with each other.

| 61. | A written resolution signed by all committee members entitled to vote on that resolution at a meeting of the committee is as valid as one passed at a committee meeting.

| 62. | The secretary of the corporation, or his designate, shall be the secretary for the committee and shall keep a record of minutes of all meetings of the committee.

| 63. | Minutes of the meetings of the committee shall be distributed by the secretary of the corporation to all members of the committee within seven (7) working days of each meeting and shall be submitted for approval at the next regular meeting of the committee.

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