Edgar Filing: CANADIAN NATIONAL RAILWAY CO

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 6-K

REPORT OF FOREIGN ISSUER PURSUANT TO RULE 13a-16 OR 15d-16

OF THE SECURITIES EXCHANGE ACT OF 1934

For the month of March 2015

Commission File Number: 001-02413

Canadian National Railway Company

(Translation of registrant’s name into English)

935 de la Gauchetiere Street West

Montreal, Quebec

Canada H3B 2M9

(Address of principal executive offices)

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F:

Form 20-F

Form 40-F

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1):

Yes

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7):

Yes

Indicate by check mark whether by furnishing the information contained in this Form, the Registrant is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934:

Yes

If “Yes” is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b): N/A

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

		Canadian National Railway Company
Date:	March 24, 2015	By:	/s/ Sean Finn
			Name:	Sean Finn
			Title:	Executive Vice-President Corporate Services and Chief Legal Officer

CANADIAN NATIONAL RAILWAY COMPANY

Table of Contents

Items	Description

1	Notice of Annual Meeting of Shareholders

2	Management Proxy Circular

3	Form of Proxy

4	Annual Report

Item 1

NOTICE OF ANNUAL

MEETING OF SHAREHOLDERS

Our annual meeting of holders of common shares will be held at

The Peabody Memphis

Venetian Room

149 Union Avenue

Memphis, Tennessee, U.S.

on Tuesday, ApriI 21, 2015, at 8:30 a.m.

(CentraI DayIight Time) for the purposes of:

1.	receiving the consolidated financial statements for the year ended December 31, 2014, and the auditors' reports thereon;

2.	electing the directors;

3.	appointing the auditors;

considering and approving, in an advisory, non-binding capacity, a resolution (the full text of which is set out on page 9 of the accompanying management information circular) accepting the Company's approach to executive compensation as disclosed in the Statement of Executive Compensation section of the accompanying management information circular; and

5.	transacting such other business as may properly be brought before the meeting or any adjournment or postponement thereof.

The directors have fixed March 5, 2015, as the Record Date for the determination of the holders of common shares entitled to receive notice of the meeting and vote at the meeting.

By order of the Board of Directors

(Signed) Sean Finn

Sean Finn

Executive Vice-President

Corporate Services and Chief Legal Officer

and Corporate Secretary

March 10, 2015

Montréal, Quebec

Item 2




	MANAGEMENT INFORMATION CIRCULAR
	AND NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
	APRIL 21, 2015

NOTICE OF ANNUAL

MEETING OF SHAREHOLDERS

Our annual meeting of holders of common shares will be held at

The Peabody Memphis

Venetian Room

149 Union Avenue

Memphis, Tennessee, U.S.

on Tuesday, April 21, 2015, at 8:30 a.m.

(Central Daylight Time) for the purposes of:

1.	receiving the consolidated financial statements for the year ended December 31, 2014, and the auditors’ reports thereon;

2.	electing the directors;

3.	appointing the auditors;

considering and approving, in an advisory, non-binding capacity, a resolution (the full text of which is set out on page 9 of the accompanying management information circular) accepting the Company’s approach to executive compensation as disclosed in the Statement of Executive Compensation section of the accompanying management information circular; and

5.	transacting such other business as may properly be brought before the meeting or any adjournment or postponement thereof.

The directors have fixed March 5, 2015, as the Record Date for the determination of the holders of common shares entitled to receive notice of the meeting and vote at the meeting.

By order of the Board of Directors

(Signed) Sean Finn

Sean Finn

Executive Vice-President

Corporate Services and Chief Legal Officer

and Corporate Secretary

March 10, 2015

Montréal, Quebec

March 10, 2015

Dear Shareholder:

On behalf of the Board of Directors and management of Canadian National Railway Company (the “Company”), we cordially invite you to attend the annual meeting of shareholders that will be held this year at The Peabody Memphis hotel, Venetian Room, 149 Union Avenue, Memphis, Tennessee (United States) on Tuesday, April 21, 2015, at 8:30 a.m. (Central Daylight Time).

This management information circular (the “Information Circular”) describes the business to be conducted at the meeting and provides information on executive compensation and CN’s governance practices. In addition to these items, we will discuss at the meeting highlights of our 2014 performance and our plans for the future. You will have the opportunity to meet and interact with your directors and the senior officers of the Company.

Your participation in the affairs of the Company is important to us. If you are unable to attend in person, we encourage you to complete and return the enclosed proxy form or voting instruction form in the envelope provided for this purpose so that your views can be represented. Also, it is possible for you to vote over the internet by following the instructions on the enclosed forms. Even if you plan to attend the meeting, you may find it convenient to express your views in advance by completing and returning the proxy form or voting instruction form or by voting over the internet.

If your shares are not registered in your name but are held in the name of a nominee, you may wish to consult the information on page 6 of the Information Circular with respect to how to vote your shares.

In addition, we would like to recognize Messrs. Charles Baillie and Edward Lumley, who are not standing for re-election and will retire from the Board of Directors at our annual meeting on April 21, 2015. We want to thank them for their dedication, wisdom and leadership throughout their outstanding tenure on the CN Board of Directors.

A live webcast of the meeting will be available on the Company’s website at www.cn.ca.

We look forward to seeing you at the meeting.

Sincerely,

(Signed) Robert Pace	(Signed) Claude Mongeau
Robert Pace Chair of the Board	Claude Mongeau President and Chief Executive Officer

CN MANAGEMENT INFORMATION CIRCULAR 2015

PROXY SUMMARY

The following summary highlights some of the important information you will find in this Information Circular. We recommend you to read the entire Information Circular before voting.

SHAREHOLDER VOTING MATTERS

	BOARD VOTE	FOR MORE INFORMATION
VOTING MATTERS	RECOMMENDATION	SEE PAGES
Election of 11 Directors	FOR each nominee	8, 10
Appointment of KPMG LLP as Auditors	FOR	8
Advisory Resolution on Executive Compensation	FOR	9, 34

OUR DIRECTOR NOMINEES

NAME	AGE	DIRECTOR SINCE	POSITION	INDEPENDENT	COMMITTEE MEMBERSHIP	ATTENDANCE IN 2014	OTHER PUBLIC BOARDS
D.J. Carty	68	2011	Corporate Director	Yes	Audit (Chair) – Governance – Environment – Compensation – Strategic	100%	3
G.D. Giffin	65	2001	Senior Partner, McKenna Long & Aldridge	Yes	Audit – Donations – Compensation (Chair) – Investment – Strategic	100%	5
E.E. Holiday	63	2001	Corporate Director and Trustee	Yes	Governance – Finance – Compensation – Investment – Strategic	100%	4
V.M. Kempston Darkes	66	1995	Corporate Director	Yes	Governance – Environment (Chair) – Finance – Compensation – Strategic	100%	4
D. Losier	62	1994	Corporate Director	Yes	Audit – Governance (Chair) – Compensation – Investment – Strategic	100%	2
K.G. Lynch	64	2014	Vice-Chair, BMO Financial Group	Yes	Governance – Environment – Finance – Compensation – Strategic	100%	2
C. Mongeau	53	2009	President and CEO, CN	No	Donations (Chair) – Strategic	100%	1
J.E. O’Connor	65	2011	Corporate Director	Yes	Audit – Environment – Finance – Compensation – Strategic (Chair)	100%	1
R. Pace	60	1994	Chair of the Board, CN President and CEO, The Pace Group	Yes	Governance – Donations – Environment – Compensation – Strategic	100%	1
R.L. Phillips	64	2014	President, R.L. Phillips Investments Inc.	Yes	Audit – Governance – Environment – Compensation – Strategic	100%	4
L. Stein	53	2014	Executive Vice-President – General Counsel, The Clorox Company	Yes	Audit – Environment – Finance – Compensation – Strategic	100%	1

2	CN MANAGEMENT INFORMATION CIRCULAR 2015

EXECUTIVE COMPENSATION

Disciplined Approach to Compensation

CN’s approach to executive compensation is driven by a commitment to deliver sustainable and solid returns to shareholders. CN exercises a disciplined approach to executive compensation by ensuring that target compensation, while reasonable, supports attraction and retention of executive talent. In addition, compensation programs are structured to provide leverage within its short and long-term incentive plans, with strong ties between realized pay and shareholder returns. Compensation programs are designed to encourage appropriate behaviours and include appropriate risk mitigation mechanisms. The executive compensation policy aims to position total direct compensation between the median and the 60th percentile of the executives’ respective comparator group. On a constant currency and Long-Term Incentive valuation basis, the year-over-year total compensation decreased by 2.8% for the President and CEO and 4.8% on average for the other Named Executive Officers in 2014.

BEST PRACTICES ADOPTED BY CN

•	~ 80% of Named Executive Officers’ target total direct compensation is variable and linked to CN’s performance

•	Incentive payout capped and no guaranteed minimum payout

•	Inclusion of a relative total shareholder return condition in 2015

•	Stringent stock ownership requirements

•	CEO post-retirement shareholding requirement

•	Overlap of performance measures for short and long-term incentives to mitigate risk

•	Double trigger change of control policy

•	Anti-hedging policy on CN securities

•	Executive clawback policy

•	No employment contracts for NEOs

•	Independent executive compensation consultant retained by the Compensation Committee

•	Annual “Say on Pay” vote

HIGHLIGHTS OF CORPORATE GOVERNANCE BEST PRACTICES

CN is committed to adhering to the highest standards of corporate governance and our corporate governance practices were designed in a manner consistent with this objective. Some of our best practices are highlighted in the following table.

Size of Board	11
Number of Independent Director Nominees	10
Annual Election of Directors (no staggered term)	Yes
Directors Elected Individually (no slate voting)	Yes
Majority Voting for Directors	Yes
Separate CEO & Chair Positions	Yes
Common Directorships Guidelines (Board Interlocks)	Yes
Board Tenure and Term Limit Guidelines for Board Chair and Committee Chairs	Yes
Stock Ownership Guidelines for Directors and Executives	Yes
Ownership Requirement for Directors and CEO Beyond Board Tenure	Yes
Director Orientation and Continuing Education	Yes
Diversity Policy for Directors	Yes
Code of Business Conduct and Ethics Program	Yes
Annual Advisory Vote on Executive Compensation	Yes
Formal Board Performance Assessment	Yes

VOTE YOUR SHARES

Voting by proxy is the easiest way to vote your shares. Please refer to your proxy form or voting instruction form included in this package or to the “Questions & Answers” section on page 5 of this Information Circular for more information on the voting methods available to you.

CN MANAGEMENT INFORMATION CIRCULAR 2015

INFORMATION CIRCULAR

This Information Circular is provided in connection with the solicitation of proxies by management of Canadian National Railway Company for use at the annual meeting of its shareholders or at any adjournment or postponement thereof (the “Meeting”). In this document “you” and “your” refer to the shareholders of, and “CN”, the “Company”, “we”, “us”, or “our” refer to Canadian National Railway Company. The Meeting will be held on Tuesday, April 21, 2015, at 8:30 a.m. (Central Daylight Time) for the purposes set forth in the foregoing Notice of Meeting. The information contained herein is given as at February 27, 2015, except as indicated otherwise.

IMPORTANT — If you are not able to attend the Meeting, please exercise your right to vote by signing the enclosed form of proxy or voting instruction form and, in the case of registered shareholders by returning it to Computershare Trust Company of Canada in the enclosed envelope, or by voting over the internet no later than 5:00 p.m. (Eastern Daylight Time) on April 20, 2015, or, if the Meeting is adjourned or postponed, by no later than 5:00 p.m. (Eastern Daylight Time) on the business day prior to the day fixed for the adjourned or postponed meeting. If you are a non-registered shareholder, reference is made to the section entitled “How do I vote if I am a non-registered shareholder?” on page 6 of this Information Circular. If you are a holder of Employee Shares (as such term is defined in this Information Circular), reference is made to the section entitled ”How do I vote if I own Employee Shares” on page 7 of this Information Circular.

WHAT’S INSIDE

	NOTICE OF ANNUAL MEETING OF SHAREHOLDERS

1	LETTER TO SHAREHOLDERS	34	STATEMENT OF EXECUTIVE COMPENSATION
		34	Letter to Shareholders
2	PROXY SUMMARY	36	Human Resources and Compensation Committee

5	QUESTIONS AND ANSWERS	39	COMPENSATION DISCUSSION AND ANALYSIS
		39	Executive Summary
8	BUSINESS OF THE MEETING	56	2014 Highlights
8	Financial Statements	56	Summary Compensation Table
8	Election of Directors	60	Incentive Plan Awards
8	Appointment of Auditors	64	Employment Arrangements
9	Advisory Vote on Executive Compensation	65	Pension Plan Benefits

10	NOMINEES FOR ELECTION TO THE BOARD	67	Termination and Change of Control Benefits
10	Description of Nominees	68	Currency Exchange Information
15	Additional Disclosure Relating to Directors
		69	OTHER INFORMATION
16	BOARD OF DIRECTORS COMPENSATION
16	Comparator Groups	69	Securities Authorized For Issuance Under Equity Compensation Plans
16	Changes to Compensation	69	Indebtedness of Directors and Executive Officers
17	Compensation Levels	69	Interest of Informed Persons and Others in Material Transactions
17	Compensation Table	69	Shareholder Proposals
18	Share Ownership	69	Availability of Documents
19	Share Ownership Table
19	Directors’ Deferred Share Unit Plan	70	SCHEDULE “A” – MANDATE OF THE BOARD

20	STATEMENT OF CORPORATE GOVERNANCE PRACTICES	72	SCHEDULE “B” – REPORTS OF THE COMMITTEES
20	General	72	Report of the Audit Committee
20	Code of Business Conduct	73	Report of the Finance Committee
21	Independence of Directors	74	Report of the Corporate Governance and Nominating Committee
21	Independent Chair of the Board	75	Report of the Human Resources and Compensation Committee
21	Position Descriptions	76	Report of the Environment, Safety and Security Committee
21	Committees of the Board	76	Report of the Strategic Planning Committee
23	Risk Management Oversight	77	Report of the Investment Committee of CN’s Pension Trust Funds
23	Board and Committee Meetings	77	Report of the Donations and Sponsorships Committee
24	Board and Committee Attendance
25	Director Selection
29	Board Performance Assessment
29	Director Orientation and Continuing Education
31	Stakeholder Engagement
32	Audit Committee Disclosure

4	CN MANAGEMENT INFORMATION CIRCULAR 2015

QUESTIONS AND ANSWERS

VOTING AND PROXIES

The following questions and answers provide guidance on how to vote your shares.

Who can vote?

Shareholders who are registered as at the close of business on March 5, 2015 (the “Record Date”), will be entitled to vote at the Meeting or at any adjournment or postponement thereof, either in person or by proxy.

As of the close of business on February 27, 2015, the Company had 807,040,436 common shares without par value outstanding. Subject to the voting restrictions described below, each common share carries the right to one vote.

To the knowledge of the directors and senior officers of the Company, based on the most recent publicly available information, the only person who beneficially owns, or directly or indirectly, exercises control or direction over, shares carrying 10% or more of the voting rights attached to any class of shares of the Company is Mr. William H. Gates, III. Mr. Gates is the sole member of Cascade Investment, L.L.C. (“Cascade”). Cascade held 86,324,874 common shares of the Company as of February 27, 2015, representing 10.7% of the outstanding common shares of the Company. In addition, Mr. Gates is a co-trustee of the Bill & Melinda Gates Foundation Trust, which held 17,126,874 common shares of the Company as of February 27, 2015, representing 2.1% of the outstanding common shares of the Company. Hence, as of February 27, 2015, Mr. Gates is deemed to have control or direction over 103,451,748 common shares, representing 12.8% of the outstanding common shares of the Company.

What will I be voting on?

Shareholders will be voting (i) to elect directors of the Company, (ii) to appoint KPMG LLP as auditors of the Company, and (iii) in an advisory, non-binding capacity, on the approach to executive compensation disclosed in the “Statement of Executive Compensation” section of this Information Circular. Our Board of Directors and our management are recommending that shareholders vote FOR items (i), (ii) and (iii).

How will these matters be decided at the Meeting?

A simple majority of the votes cast, in person or by proxy, will constitute approval of these matters.

Who is soliciting my proxy?

Management of the Company is soliciting your proxy. The solicitation is being made primarily by mail, but our directors, officers or employees may also solicit proxies at a nominal cost to the Company. The Company has retained and will pay for the services of D.F. King Canada, a division of CST Investor Services Inc. (“D.F. King”), for the solicitation of proxies in Canada and the United States, at an aggregate cost estimated to be approximately C$30,000 plus additional costs relating to out-of-pocket expenses.

Who can I call with questions?

If you have questions about the information contained in this Information Circular or require assistance in completing your form of proxy, please call D.F. King, the Company’s proxy solicitation agent, toll-free in North America at 1-800-239-6813 or at 1-201-806-7301 outside of North America; or by e-mail at inquiries@dfking.com.

How can I contact the transfer agent?

You can contact the transfer agent either by mail at Computershare Trust Company of Canada, 100 University Ave., 8th Floor, Toronto (Ontario) M5J 2Y1, by telephone at 1-800-564-6253, by fax at 1-888-453-0330 or by internet at www.investorcentre.com/service, or in French: www.centredesinvestisseurs.com/service.

How do I vote?

If you are eligible to vote and your common shares are registered in your name, you can vote your common shares in person at the Meeting or by proxy, as explained below. If your common shares are held in the name of a nominee, please see the instructions below under “How do I vote if I am a non-registered shareholder?”

What are the voting restrictions?

Our articles of incorporation, as amended, provide that no person, together with his or her associates, shall hold, beneficially own or control, directly or indirectly, voting shares to which are attached more than 15% in the aggregate of the votes attached to all our voting shares that may ordinarily be cast to elect directors of the Company. In addition, where the total number of voting shares held, beneficially owned or controlled, directly or indirectly, by any one person together with his or her associates exceeds such 15% maximum, no person shall, in person or by proxy, exercise the voting rights attached to the voting shares held, beneficially owned or controlled, directly or indirectly, by such person or his or her associates.

How do I vote if I am a registered shareholder?

1.	VOTING BY PROXY

You are a registered shareholder if your name appears on your share certificate or Direct Registration System (DRS). If this is the case, you may appoint someone else to vote for you as your proxy holder by using the enclosed form of proxy. The persons currently named as proxies in such form of proxy are the Board Chair and the President and Chief Executive Officer of the Company. However, you have the right to appoint any other person or company (who need not be a shareholder) to attend and act on your behalf at the Meeting. That right may be exercised by writing the name of such person or company in the blank space provided in the form of proxy or by completing another proper form of proxy. Make sure that the person you appoint is aware that he or she is appointed and that this person attends the Meeting.

•

How can I send my form of proxy?

You can either return a duly completed and executed form of proxy to the transfer agent and registrar for the Company’s common shares, Computershare Trust Company of Canada, in the envelope provided, or you can vote by phone or over the internet by following the instructions on the form of proxy.

CN MANAGEMENT INFORMATION CIRCULAR 2015

•	What is the deadline for receiving the form of proxy?

The deadline for receiving duly completed forms of proxy or a vote over the internet is 5:00 p.m. (Eastern Daylight Time) on April 20, 2015, or if the Meeting is adjourned or postponed, by no later than 5:00 p.m. (Eastern Daylight Time) on the business day prior to the day fixed for the adjourned or postponed meeting.

•	How will my common shares be voted if I give my proxy?

Your common shares will be voted or withheld from voting in accordance with your instructions indicated on the proxy. If no instructions are indicated, your common shares represented by proxies in favour of the Board Chair or the President and Chief Executive Officer will be voted as follows:

FOR the election of management’s nominees as directors,

FOR the appointment of KPMG LLP as auditors,

FOR, in an advisory, non-binding capacity, the approach to executive compensation disclosed in the Statement of Executive Compensation section of this Information Circular,

and at the discretion of the proxy holder in respect of amendments to any of the foregoing matters or on such other business as may properly be brought before the Meeting. Should any nominee named herein for election as a director become unable to accept nomination for election, it is intended that the person acting under proxy in favour of management will vote for the election in his or her stead of such other person as management of the Company may recommend. Management has no reason to believe that any of the nominees for election as directors will be unable to serve if elected to office and management is not aware of any amendment or other business likely to be brought before the Meeting.

•	If I change my mind, how can I revoke my proxy?

You may revoke your proxy at any time by an instrument in writing (which includes another form of proxy with a later date) executed by you, or by your attorney (duly authorized in writing), and (i) deposited with the Corporate Secretary of the Company at the registered office of the Company (935 de La Gauchetière Street West, Montréal, Quebec, Canada, H3B 2M9) at any time up to and including 5:00 p.m. (Eastern Daylight Time) on the last business day preceding the day of the Meeting or any adjournment or postponement thereof, or (ii) filed with the chair of the Meeting on the day of the Meeting or any adjournment or postponement thereof, or in any other manner permitted by law or in the case of a vote over the internet, by way of a subsequent internet vote.

2.	VOTING IN PERSON

If you wish to vote in person, you may present yourself to a representative of Computershare Trust Company of Canada at the registration table, the day of the Meeting. Your vote will be taken and counted at the Meeting. If you wish to vote in person at the Meeting, do not complete or return the form of proxy.

How do I vote if I am a non-registered shareholder?

If your common shares are not registered in your name and are held in the name of a nominee such as a trustee, financial institution or securities broker, you are a “non-registered shareholder”. If your common shares are listed in an account statement provided to you by your broker, those common shares will, in all likelihood, not be registered in your name. Such common shares will more likely be registered under the name of your broker or an agent of that broker. Without specific instructions, brokers and their agents or nominees are prohibited from voting shares for the broker’s client. If you are a non-registered shareholder, there are two ways you can vote your common shares, as listed below:

1.	GIVING YOUR VOTING INSTRUCTIONS

Applicable securities laws require your nominee to seek voting instructions from you in advance of the Meeting. Accordingly, you will receive or have already received from your nominee a voting instruction form for the number of common shares you hold. Every nominee has its own mailing procedures and provides its own signature and return instructions, which should be carefully followed by non-registered shareholders to ensure that their common shares are voted at the Meeting.

2.	VOTING IN PERSON

However, if you wish to vote in person at the Meeting, insert your own name in the space provided on the voting instruction form provided by your nominee to appoint yourself as proxy holder and follow the signature and return instructions of your nominee. Computershare Trust Company of Canada must receive your appointment no later than 5:00 p.m. (Eastern Daylight Time) on April 20, 2015. Non-registered shareholders who appoint themselves as proxy holders should present themselves at the Meeting to a representative of Computershare Trust Company of Canada. Do not otherwise complete the voting instruction form sent to you as you will be voting at the Meeting.

Non-registered shareholders are either “objecting beneficial owners” or “OBOs” who object that intermediaries disclose information about their ownership in the Company, or “non-objecting beneficial owners” or “NOBOs”, who do not object to such disclosure. The Company pays intermediaries to send proxy-related materials to OBOs and NOBOs.

6	CN MANAGEMENT INFORMATION CIRCULAR 2015

How do I vote if I own Employee Shares?

Common shares purchased by employees of the Company under its Canadian and U.S. Employee Share Investment Plans and its Union and Management Savings Plans for U.S. Operations (the “Plans”), are known as “Employee Shares”. Employee Shares remain registered in the name of the Plans’ Custodian (the “Custodian”), unless the employees have withdrawn their common shares from the Plans in accordance with their provisions.

Voting rights attached to the Employee Shares that are registered in the name of the Custodian can be exercised by employees, or their attorneys authorized in writing, by indicating on the enclosed voting instruction form the necessary directions to the Custodian or any other person or company (who need not be a shareholder) as to how they wish their Employee Shares to be voted at the Meeting. Beneficial owners of Employee Shares may also give such voting instructions by telephone or over the internet. The Employee Shares will be voted pursuant to the directions of the beneficial owner. If no choice is specified for an item, the Employee Shares will be voted in accordance with management’s recommendations mentioned above and at the discretion of the Custodian or such other person indicated, in respect of amendments to the items mentioned on the enclosed voting instruction form or on such other business as may properly be brought before the Meeting. Only Employee Shares in respect of which a voting instruction form has been signed and returned (or in respect of which the employee has given voting instructions by telephone or over the internet) will be voted. If you wish to vote Employee Shares in person at the Meeting, refer to paragraph 2 of the section entitled “How do I vote if I am a non-registered shareholder?”

A holder of Employee Shares may revoke his or her directions, as indicated on a voting instruction form, at any time by an instrument in writing executed by the holder of Employee Shares, or by the holder’s attorney duly authorized in writing, provided such written instrument indicating the holder’s intention to revoke is (i) deposited with the Corporate Secretary of CN at the registered office of CN at any time up to and including 5:00 p.m. (Eastern Daylight Time) on the last business day preceding the day of the Meeting or any adjournment or postponement thereof, or (ii) filed with the chair of the Meeting on the day of the Meeting or any adjournment or postponement thereof, or in any other manner permitted by law, or in the case of directions given by telephone or over the internet, by way of subsequent telephone or internet directions.

The voting instruction form must be used only with respect to Employee Shares. In the event that an employee holds common shares outside the Plans, he or she must also complete the enclosed form of proxy with respect to such additional common shares. No form of proxy is to be completed with respect to Employee Shares.

CN MANAGEMENT INFORMATION CIRCULAR 2015

BUSINESS OF THE MEETING

FINANCIAL STATEMENTS

Our consolidated financial statements for the year ended December 31, 2014, together with the auditors’ reports thereon, are included in the 2014 Annual Report of the Company, available on our website at www.cn.ca, on SEDAR at www.sedar.com, in the Company’s annual report on Form 40-F available on EDGAR at www.sec.gov, and in print, free of charge, to any shareholder who requests copies by contacting our Corporate Secretary at (514) 399-7091 or Investor Relations at (514) 399-0052.

ELECTION OF DIRECTORS

Our articles of incorporation, as amended, provide that our Board of Directors shall consist of a minimum of seven and a maximum of 21 directors (hereinafter the “Board” or “Board of Directors”). Pursuant to a resolution of the Board of Directors, 11 persons are to be elected as directors for the current year, each to hold office until the next annual meeting of shareholders or until such person’s successor is elected or appointed.

The term of office of each of the present directors expires at the close of the Meeting. The persons named in the section entitled “Nominees for Election to the Board — Description of Nominees” will be presented for election at the Meeting as management’s nominees. All of the nominees proposed for election as directors are currently directors of the Company. Mr. A. Charles Baillie and the Hon. Edward C. Lumley are not standing for re-election at the Meeting. All persons nominated were recommended to the Board of Directors by the Corporate Governance and Nominating Committee. Information relating to Messrs. Baillie and Lumley does not appear along with the information regarding the 11 proposed nominees for election as directors of the Company. Nevertheless, because Messrs. Baillie and Lumley acted as directors up to the Meeting, information concerning them appears in the other sections of this Information Circular that pertain to the members of the Board.

Unless authority is withheld, the persons designated in the accompanying form of proxy or voting instruction form intend to vote FOR the election of the persons named in the section entitled “Nominees for Election to the Board — Description of Nominees”. These nominees are, in the opinion of the Board of Directors and management, well qualified to act as directors of the Company for the ensuing year and have confirmed their willingness to serve as directors. The Board of Directors and management do not contemplate that any of these nominees will be unable to serve as a director, but should that occur for any reason before the Meeting, the persons designated in the accompanying form of proxy or voting instruction form reserve the right to vote for another nominee at their discretion unless the shareholder who has given such proxy or voting instruction form has directed that the common shares be withheld from voting on the election of any of the directors.

MAJORITY VOTING POLICY

The Board of Directors has adopted a policy which is part of our Corporate Governance Manual, to the effect that a nominee for election as a director of the Company who receives a greater number of votes “withheld” than votes “for”, with respect to the election of directors by shareholders, will be expected to offer to tender his or her resignation to the Board Chair promptly following the meeting of shareholders at which the director is elected. The Corporate Governance and Nominating Committee will consider such offer and make a recommendation to the Board of Directors whether to accept it or not. The Board of Directors will make its decision and announce it in a press release within 90 days following the meeting of shareholders. The director who offered to tender his or her resignation should not be part of any committee or Board of Directors deliberations pertaining to the resignation offer. This policy only applies in circumstances involving an uncontested election of directors. An “uncontested election of directors” means that the number of director nominees is the same as the number of directors to be elected to the Board and that no proxy material is circulated in support of one or more nominees who are not part of the candidates supported by the Board of Directors.

APPOINTMENT OF AUDITORS

The Board of Directors and the Audit Committee recommend that KPMG LLP be appointed to serve as our auditors until the next annual meeting of shareholders.

KPMG LLP has served as the Company’s auditors since 1992. For the years ended December 31, 2014 and 2013, the fees for audit, audit-related, tax and all other services provided to the Company by KPMG LLP were the following:

	2014		2013
FEES (IN THOUSANDS)		($C)		($C)
Audit		2,728		2,608
Audit-related		1,162		1,249
Tax		746		834
All other		92		131
TOTAL FEES		4,728		4,822

Pursuant to the terms of its charter, the Audit Committee approves all audit and audit-related services, audit engagement fees and terms and all non-audit engagements provided by the external auditors. The Audit Committee pre-approved all the services performed by our external auditors for audit-related and non-audit related services for the years ended December 31, 2014 and 2013.

8	CN MANAGEMENT INFORMATION CIRCULAR 2015

The nature of the services under each category is described below.

AUDIT FEES

Consist of fees incurred for professional services rendered by the auditors in relation to the audit of the Company’s consolidated annual financial statements and those of its subsidiaries, and the audit relating to the Company’s internal control over financial reporting.

AUDIT-RELATED FEES

Audit-related fees were incurred for professional services rendered by the auditors in relation to the audit of the financial statements for the Company’s pension plans, and for attestation services in connection with reports required by statute or regulation and due diligence and other services, including comfort letters, in connection with the issuance of securities.

TAX FEES

Consist of fees incurred for consultations on cross-border tax implications for employees and tax compliance.

ALL OTHER FEES

Consist primarily of fees incurred for services related to a foreign subsidiary (2014) and Information Technology (2013).

Unless authority is withheld, the persons designated in the accompanying form of proxy or voting instruction form intend to vote FOR the appointment of KPMG LLP as auditors of the Company to hold office until the next annual meeting of shareholders.

ADVISORY VOTE ON EXECUTIVE COMPENSATION

The Company is again providing its shareholders with an opportunity to cast at the Meeting an advisory vote on the Company’s approach to executive compensation, as disclosed in the “Statement of Executive Compensation” section of this Information Circular. Such section describes the role of the Human Resources and Compensation Committee in overseeing compensation of executives and ensuring that it is linked to the Company’s three-year business plan. The section also describes the Company’s executive compensation principles, the structure of the compensation plans for executives, and the alignment of such plans with the interests of our shareholders.

The Board of Directors recommends that shareholders vote FOR the resolution set out below and, unless otherwise instructed, the persons designated in the form of proxy intend to vote FOR the following resolution:

“RESOLVED that, on an advisory basis and not to diminish the role and responsibilities of the Board of Directors, the shareholders accept the approach to executive compensation disclosed in the section entitled “Statement of Executive Compensation” of the Information Circular of the Company dated March 10, 2015.”

The Board of Directors has adopted a policy to the effect that, if a majority of the shares represented in person or by proxy at the meeting are voted against the above non-binding advisory resolution, the Board Chair or the Chair of the Human Resources and Compensation Committee will oversee a process to engage with shareholders with a view to giving them the opportunity to express their specific concerns. The Board of Directors and the Human Resources and Compensation Committee will consider the results of this process and, if appropriate, review the Company’s approach to executive compensation in the context of shareholders’ specific concerns.

CN MANAGEMENT INFORMATION CIRCULAR 2015

NOMINEES FOR ELECTION TO THE BOARD

DESCRIPTION OF NOMINEES

The following tables set out information as of February 27, 2015, unless otherwise indicated, and include a profile of each nominated director with an explanation of his or her experience, qualifications, top three competencies, participation on the Board and its committees, ownership of securities of CN, as well as participation on the boards of other public companies during the past five years. A more detailed description of our directors’ competencies can be found under the heading “Competency Matrix” in the section entitled “Statement of Corporate Governance Practices”. All nominees are current directors of the Company.

	Donald J. Carty,	Mr. Carty retired as Vice-Chairman and Chief Financial Officer of Dell, Inc. (computer manufacturer) a position he assumed from January 2007 until June 2008 and as Chairman and CEO of AMR Corporation and American Airlines in 2003, after 30 years in the airline business, where he previously served as President and Executive Vice-President of Finance & Planning of AMR Airline Group and American Airlines. He was President and CEO of CP Air from 1985 to 1987. In the voluntary sector, Mr. Carty is on the Executive Board of the SMU Cox School of Business. He is a former Chairman of Big Brothers Big Sisters of America. In 1999, Board Alert named Mr. Carty one of the year’s Outstanding Directors. He was named an Officer of the Order of Canada in 2003. In addition to serving on the public boards mentioned in the following table, Mr. Carty serves as Chairman of the boards of Porter Airlines, Inc. and Research Now Group, Inc. Mr. Carty holds a B.A. and an Honorary Doctor of Laws from Queen’s University and a MBA from Harvard Business School.
	O.C., LL.D.
	Corporate Director
	Age: 68 (1)
	Texas, U.S.A.
	Director Since:
	January 1, 2011
	Independent



Principal Competencies
• Strategy
• Finance/Accounting
• Human Resources

MEMBER OF (6)	ATTENDANCE 2014	OTHER PUBLIC BOARDS DURING PAST 5 YEARS
Board	100%	EMC Corporation	(2015-present)
Audit Committee (Chair)	100%	Talisman Energy Inc.	(2009-present)
Corporate Governance and Nominating Committee	100%	Virgin America Inc. (Chairman)	(2006-present)
Environment, Safety and Security Committee	100%	Gluskin, Sheff & Associates Inc.	(2006-2013)
Finance Committee	100%	Barrick Gold Corporation	(2006-2013)
Human Resources and Compensation Committee	100%	Dell, Inc.	(1992-2013)
Investment Committee of CN’s Pension Trust Funds (5)	100%	Hawaiian Holdings, Inc.	(2004-2011)
Strategic Planning Committee	100%
		SECURITIES HELD
2014 VOTES IN FAVOUR	99.49%	VALUE AT RISK	C$4,898,621(3)

COMMON SHARES OWNED OR CONTROLLED (2)
February 2015	56,667
February 2014	38,785

	Ambassador	Mr. Giffin is Senior Partner and the Chair of the Public Policy and International department at McKenna Long & Aldridge LLP, where he maintains offices in Washington, D.C. and Atlanta. He has been engaged in the practice of law or government service for more than thirty-five years. Mr. Giffin was United States Ambassador to Canada from 1997 to 2001. Mr. Giffin is a member of the Board of Trustees of the Jimmy Carter Presidential Center and is a member of the Council on Foreign Relations and the Tri-Lateral Commission. In addition to serving on the public boards mentioned in the following table, Mr. Giffin serves on the Board of Counsellors of McLarty Global. Mr. Giffin holds a B.A. from Duke University and a J.D. from Emory University School of Law.
	Gordon D. Giffin
	Senior Partner,
	McKenna Long
	& Aldridge
	Age: 65 (1)
	Georgia, U.S.A.
	Director Since:
	May 1, 2001
	Independent

Principal Competencies
• Public Policy
• Legal
• Human Resources

MEMBER OF (6)	ATTENDANCE 2014	OTHER PUBLIC BOARDS DURING PAST 5 YEARS
Board	100%	Element Financial Corporation	(2013-present)
Human Resources and Compensation Committee (Chair)	100%	Just Energy Group Inc.	(2006-present)
Audit Committee	100%	Canadian Natural Resources Limited	(2002-present)
Donations and Sponsorships Committee (5)	100%	TransAlta Corporation (Chair)	(2002-present)
Environment, Safety and Security Committee	100%	Canadian Imperial Bank of Commerce	(2001-present)
Finance Committee	100%
Investment Committee of CN’s Pension Trust Funds (5)	100%
Strategic Planning Committee	100%
		SECURITIES HELD
2014 VOTES IN FAVOUR	97.16%	VALUE AT RISK	C$7,543,688 (3)

Common Shares Owned or Controlled (2)
February 2015	87,265
February 2014	83,682

10	CN MANAGEMENT INFORMATION CIRCULAR 2015

	Edith E. Holiday	Ms. Holiday is a Corporate Director and Trustee and a former General Counsel, United States Treasury Department and former Secretary of the Cabinet, The White House. Ms. Holiday serves on the public boards mentioned in the following table. She was also the recipient of the Direct Women’s 2009 Sandra Day O’Connor Board Excellence Award, which honours women who have served with distinction on the board of a public company and advanced the value of diversity in the workplace. She is also the recipient of the Secretary of the Treasury’s highest award, the Alexander Hamilton Award. Ms. Holiday holds a B.S. and a J.D. from the University of Florida, and she was admitted to the bars of the states of Florida, Georgia and the District of Columbia.
	Corporate Director
	& Trustee
	Age: 63 (1)
	Florida, U.S.A.
	Director Since:
	June 1, 2001
	Independent



Principal Competencies
• Legal
• Public Policy
• Strategy

MEMBER OF (6)	ATTENDANCE 2014	OTHER PUBLIC BOARDS DURING PAST 5 YEARS
Board	100%	White Mountains Insurance Group, Ltd.	(2004-present)
Corporate Governance and Nominating Committee	100%	RTI International Metals, Inc.	(1999-present)
Finance Committee	100%	Franklin Templeton Group of Funds (various companies)	(1996-present)
Human Resources and Compensation Committee	100%	Hess Corporation	(1993-present)
Investment Committee of CN’s Pension Trust Funds (5)	100%	H.J. Heinz Company	(1994-2013)
Strategic Planning Committee	100%
		SECURITIES HELD
2014 VOTES IN FAVOUR	99.35%	VALUE AT RISK	C$8,794,730 (3)

Common Shares Owned or Controlled (2)
February 2015	101,737
February 2014	98,390

	V. Maureen	Ms. Kempston Darkes is the retired Group Vice-President and President Latin America, Africa and Middle East, General Motors Corporation. In 2009 she ended a 35-year career at GM during which she attained the highest operating post ever held by a woman at GM. From 1994 to 2001, she was President and General Manager of General Motors of Canada Limited and Vice-President of General Motors Corporation. She is an Officer of the Order of Canada, a member of the Order of Ontario and was ranked by Fortune magazine in 2009 as the 12th Most Powerful Woman in International Business and amongst the top 100 most powerful women in Canada in 2012. In 2006, she was the recipient of the Governor General of Canada’s Awards in Commemoration of the Persons Case and was inducted as a fellow of the Institute of Corporate Directors in 2011. She has also been appointed by the Government of Canada to the Science, Technology and Innovation Council and the Advisory Council for Promoting Women on Boards. In addition to serving on the public boards mentioned in the following table, Ms. Kempston Darkes is also a director of Irving Oil Company Ltd. Ms. Kempston Darkes has received Honorary Doctor of Law Degrees from the University of Toronto and the University of Victoria, including an Honorary Doctor of Commerce from Saint Mary’s University. She holds a B.A. in history and political science from Victoria University and the University of Toronto and an LL.B. from the University of Toronto Faculty of Law.
	Kempston Darkes,
	O.C., D. COMM., LL.D.
	Corporate Director
	Age: 66 (1)
	Ontario, Canada
	Florida, U.S.A.
	Director Since:
	March 29, 1995
	Independent

Principal Competencies
• Transport Industry/Safety
• Sales/Marketing
• Human Resources

MEMBER OF (6)	ATTENDANCE 2014	OTHER PUBLIC BOARDS DURING PAST 5 YEARS
Board	100%	Schlumberger Limited	(2014-present)
Environment, Safety and Security Committee (Chair)	100%	Balfour Beatty Plc.	(2012-present)
Audit Committee	100%	Enbridge Inc.	(2010-present)
Corporate Governance and Nominating Committee	100%	Brookfield Asset Management Inc.	(2008-present)
Finance Committee	100%
Human Resources and Compensation Committee	100%
Investment Committee of CN’s Pension Trust Funds (5)	100%
Strategic Planning Committee	100%
		SECURITIES HELD
2014 VOTES IN FAVOUR	97.30%	VALUE AT RISK	C$15,496,717 (3)

Common Shares Owned or Controlled (2)
February 2015	179,464
February 2014	175,969

CN MANAGEMENT INFORMATION CIRCULAR 2015

	The Hon.	Mr. Losier is the retired President and Chief Executive Officer of Assumption Life (life insurance company). Between 1989 and 1994, Mr. Losier held various cabinet level positions with the government of the Province of New Brunswick, including Minister of Fisheries and Aquaculture and Minister of Economic Development and Tourism. Mr. Losier was co-chair of the University of Moncton’s Excellence Campaign. In 2008, he was named a member of the Security Intelligence Review Committee of Canada, and, as such, became a member of the Privy Council. In addition to serving on the public boards mentioned in the following table, Mr. Losier is a director of Enbridge Gas New Brunswick and chairs the board of directors of Invest N.B. and is a past member and director of the New Brunswick Business Council and Canadian Blood Services, respectively. Mr. Losier was appointed a Member of the Order of Canada in 2011. Mr. Losier holds a Bachelor of Economics from the University of Moncton and a Masters of Economics from the University of Western Ontario. Mr. Losier was awarded an Honorary Doctorate Degree in Business Administration from the University of Moncton.
	Denis Losier,
	P.C., LL.D., C.M.
	Corporate Director
	Age: 62 (1)
	New Brunswick,
	Canada
	Director Since:
	October 25, 1994
	Independent

Principal Competencies
• Finance/Accounting
• Human Resources
• Sales/Marketing

MEMBER OF (6)	ATTENDANCE 2014	OTHER PUBLIC BOARDS DURING PAST 5 YEARS
Board	100%	Capital DGMC Inc. (Chairman)	(2013-present)
Corporate Governance and Nominating Committee (Chair)	100%	Plazacorp Retail Properties Ltd.	(2007-present)
Audit Committee	100%	XL-ID Solutions Inc. (formerly, Excellium Inc.)	(2013)
Donations and Sponsorships Committee (5)	100%	NAV CANADA	(2004-2013)
Environment, Safety and Security Committee	100%
Human Resources and Compensation Committee	100%
Investment Committee of CN’s Pension Trust Funds (5)	100%
Strategic Planning Committee	100%
		SECURITIES HELD
2014 VOTES IN FAVOUR	97.25%	VALUE AT RISK	C$24,914,738 (3)

Common Shares Owned or Controlled (2)
February 2015	288,532
February 2014	284,137

	The Hon.	The Honorable Kevin G. Lynch is Vice-Chair, BMO Financial Group. In this role, Dr. Lynch is a key strategic advisor to senior management. He represents BMO in domestic and international markets. Prior to joining BMO, Dr. Lynch built a distinguished career in the Government of Canada. Before his retirement in 2009, he served as Clerk of the Privy Council, Secretary to the Cabinet, and Head of the Public Service of Canada. Dr. Lynch began his public service career at the Bank of Canada in 1976 and has held a number of senior positions in the Government of Canada. These included the post of Deputy Minister of Industry, from 1995 to 2000, and Deputy Minister of Finance, from 2000 to 2004. From 2004 to 2006, he served as Executive Director (for the Canadian, Irish and Caribbean constituency) at the International Monetary Fund in Washington, D.C. In addition to serving on the public boards mentioned in the following table, Dr. Lynch is the Chair of the Board of Governors of the University of Waterloo, the Chancellor of King’s University and serves on several other boards, including those of the Asia Pacific Foundation and the Gairdner Foundation. Dr. Lynch is also a member of the World Economic Forum’s Global Policy Councils. Dr. Lynch has received honorary degrees from seven Canadian universities and was made a Member of the Queen’s Privy Council for Canada in 2009, and an Officer of the Order of Canada in 2011. He has been awarded the Distinguished Alumni Award from McMaster University and the Queen’s Golden Jubilee Medal. The Honorable Kevin G. Lynch earned his master’s in Economics from the University of Manchester and a doctorate in Economics from McMaster University.
	Kevin G. Lynch,
	P.C., O.C., PH.D., LL.D.
	Vice-Chair, BMO
	Financial Group
	Age: 64 (1)
	Ontario, Canada
	Director Since:
	April 23, 2014
	Independent

Principal Competencies
• Public Policy
• Finance/Accounting
• Strategy

MEMBER OF (6)	ATTENDANCE 2014	OTHER PUBLIC BOARDS DURING PAST 5 YEARS
Board	100%	CNOOC Limited	(2014-present)
Corporate Governance and Nominating Committee	100%	Empire Company Limited (Sobey’s)	(2013-present)
Environment, Safety and Security Committee	100%
Finance Committee	100%
Human Resources and Compensation Committee	100%
Strategic Planning Committee	100%
		SECURITIES HELD
2014 VOTES IN FAVOUR	99.78%	VALUE AT RISK	C$583,035 (3)

Common Shares Owned or Controlled (2)
February 2015	6,752
February 2014	NIL

12	CN MANAGEMENT INFORMATION CIRCULAR 2015

	Claude Mongeau	Mr. Mongeau became President and Chief Executive Officer of the Company on January 1, 2010. In 2000, he was appointed Executive Vice-President and Chief Financial Officer of the Company and held such position until June 1, 2009. Prior to this, he held the positions of Vice-President, Strategic and Financial Planning and Assistant Vice-President, Corporate Development upon joining the Company in 1994. In 2005, he was selected Canada’s CFO of the Year by an independent committee of prominent Canadian business leaders. Prior to joining CN, Mr. Mongeau was a partner with Secor Group, a Montréal-based management consulting firm. He also worked in the business development unit of Imasco Inc. and as a consultant at Bain & Company. Mr. Mongeau is a nominee for election as director of the board of The Toronto-Dominion Bank, at its March 26, 2015 annual shareholder meeting. Mr. Mongeau also serves as Chairman of the Board of the Railway Association of Canada. Mr. Mongeau holds an MBA from McGill University.
	President & CEO, CN
	Age: 53 (1)
	Quebec, Canada
	Director Since:
	October 20, 2009
	NOT Independent




Principal Competencies
• Strategy
• Transport Industry/Safety
• Finance/Accounting

MEMBER OF (6)	ATTENDANCE 2014	OTHER PUBLIC BOARDS DURING PAST 5 YEARS
Board	100%	TD Bank	(2015 nominee)
Donations and Sponsorships Committee (Chair) (5)	100%	SNC-Lavalin Group Inc.	(2003-present)
Investment Committee of CN’s Pension Trust Funds (5)	100%
Strategic Planning Committee	100%
		SECURITIES HELD
2014 VOTES IN FAVOUR	99.84%	VALUE AT RISK	C$41,245,337 (3)

Common Shares Owned or Controlled (2)		Stock Options Held (4)
February 2015	477,653	February 2015	1,738,000
February 2014	469,982	February 2014	1,738,000

	James E. O’Connor	Mr. O’Connor is the retired chair of the board of directors of Republic Services, Inc., a leading provider of non-hazardous solid waste collection, recycling and disposal services in the United States. From 1998 to 2011, Mr. O’Connor was chair and Chief Executive Officer of Republic Services, Inc. Prior to 1998, he had held various management positions at Waste Management, Inc. In 2001, Mr. O’Connor was the recipient of the Ellis Island Medal of Honor from the National Ethnic Coalition of Organizations (NECO) which rewards Americans who exemplify outstanding qualities in both their personal and professional lives, while continuing to preserve the richness of their particular heritage. He was named to the list of America’s Best CEOs each year, between 2005 and 2010. In 2011, Mr. O’Connor was named to the Institutional Investors’ All American Executive Team. He is also active in many community causes, especially those that benefit children. Mr. O’Connor has served on the board of directors of the SOS Children’s Village. In addition to serving on the Board of Clean Energy Fuels Corp., Mr. O’Connor also serves on the board of directors of the South Florida P.G.A. of America Foundation. Mr. O’Connor holds a Bachelor of Science in Commerce (concentration in accounting) from DePaul University.
	Corporate Director
	Age: 65 (1)
	Florida, U.S.A.
	Director Since:
	April 27, 2011
	Independent




Principal Competencies
• Strategy
• Engineering/Environment
• Human Resources

MEMBER OF (6)	ATTENDANCE 2014	OTHER PUBLIC BOARDS DURING PAST 5 YEARS
Board	100%	Clean Energy Fuels Corp.	(2011-present)
Audit Committee	100%	Republic Services, Inc.	(1998-2011)
Environment, Safety & Security Committee	100%
Finance Committee	100%
Human Resources and Compensation Committee	100%
Investment Committee of CN’s Pension Trust Funds (5)	100%
Strategic Planning Committee (Chair)	100%
		SECURITIES HELD
2014 VOTES IN FAVOUR	97.14%	VALUE AT RISK	C$1,873,971(3)

Common Shares Owned or Controlled (2)
February 2015	21,678
February 2014	18,668

CN MANAGEMENT INFORMATION CIRCULAR 2015

	Robert Pace, D. COMM.	Mr. Pace is President and Chief Executive Officer, The Pace Group (radio broadcasting, real estate development and environmental services). He began his professional career as a lawyer in Halifax with the firm Chandler Moore. In 1981, he accepted an appointment to act as the Atlantic Advisor to the Prime Minister of Canada, the Right Honourable Pierre Elliott Trudeau. In addition to serving on the public boards mentioned in the following table, Mr. Pace is also Chairman of the Walter Gordon Foundation, a director of the Atlantic Salmon Federation and former director of the Asia Pacific Foundation. Mr. Pace holds an MBA and an LL.B from Dalhousie University and holds an Honourary Doctor of Commerce Degree from Saint Mary’s University. Mr. Pace has also completed Corporate Director education programs at both Harvard and Chicago Business Schools.
	Chair of the Board, CN
	President & CEO,
	The Pace Group
	Age: 60 (1)
	Nova Scotia, Canada
	Director Since:
	October 25, 1994
	Independent


Principal Competencies
• Human Resources
• Transport Industry/Safety
• Strategy

MEMBER OF (6)	ATTENDANCE 2014	OTHER PUBLIC BOARDS DURING PAST 5 YEARS
Board (Chair)	100%	High Liner Foods Incorporated	(1998-present)
Audit Committee	100%	Hydro One Inc.	(2007-2014)
Corporate Governance and Nominating Committee	100%	Overland Realty Limited	(2006-2010)
Donations and Sponsorships Committee (5)	100%
Environment, Safety & Security Committee	100%
Human Resources and Compensation Committee	100%
Investment Committee of CN’s Pension Trust Funds (5)	100%
Strategic Planning Committee	100%
		SECURITIES HELD
2014 VOTES IN FAVOUR	99.05%	VALUE AT RISK	C$25,829,357 (3)

Common Shares Owned or Controlled (2)
February 2015	299,124
February 2014	288,926

	Robert L. Phillips	Mr. Phillips is the President of R.L. Phillips Investments Inc. and was previously President and Chief Executive Officer and director of British Columbia Railway Company Limited from 2001 to 2004. Mr. Phillips was Executive Vice-President, Business Development and Strategy for MacMillan Bloedel Ltd. and, before that, held the position of Chief Executive Officer at PTI Group and Dreco Energy Services Limited. He also enjoyed a prestigious career as a corporate lawyer and was appointed to the Queen’s Counsel in Alberta in 1991. Mr. Phillips serves on the public boards mentioned in the following table. He has also served as a director of the Canadian Chamber of Commerce, as a member of the Alberta Economic Development Authority (AEDA) and as a director of the Export and Trade Committee of the AEDA. Mr. Phillips received his Bachelor of Laws (Gold Medalist), and Bachelor of Science, Chemical Engineering (Hons) from the University of Alberta.
	President,
	R.L. Phillips
	Investments Inc.
	Age: 64 (1)
	British Columbia,
	Canada
	Director Since:
	April 23, 2014
	Independent

Principal Competencies
• Transport Industry/Safety
• Strategy
• Sales/Marketing

MEMBER OF (6)	ATTENDANCE 2014	OTHER PUBLIC BOARDS DURING PAST 5 YEARS
Board	100%	West Fraser Timber Co. Ltd (Lead Director)	(2005-present)
Audit Committee	100%	Precision Drilling Corporation (Chairman)	(2004-present)
Corporate Governance and Nominating Committee	100%	MacDonald Dettwiler & Associates Ltd. (Chairman)	(2003-present)
Environment, Safety & Security Committee	100%	Canadian Western Bank	(2001-present)
Human Resources and Compensation Committee	100%	Axia NetMedia Corporation	(2000-2014)
Strategic Planning Committee	100%	Epcor Utilities Inc.	(2005-2014)
		Capital Power Corporation	(2009-2013)
2014 VOTES IN FAVOUR	99.79%	Terra Vest Income Fund	(2004-2012)

				SECURITIES HELD
				VALUE AT RISK	C$1,068,754 (3)

Common Shares Owned or Controlled (2)
February 2015	12,377
February 2014	4,125

14	CN MANAGEMENT INFORMATION CIRCULAR 2015

	Laura Stein	Ms. Stein is the Executive Vice-President – General Counsel of The Clorox Company (marketer and manufacturer of consumer products) where she serves on the executive committee. From 2000 to 2005, Ms. Stein was Senior Vice-President, General Counsel of the H.J. Heinz Company. She was also previously a corporate lawyer with Morrison & Foerster in San Francisco and Hong Kong. Ms. Stein is a director of Franklin Resources, Inc. and a former director of Nash Finch Company and serves on the boards of several not-for-profit organizations, including Corporate Pro Bono, Equal Justice Works, the Leadership Council on Legal Diversity and the Association of General Counsel. Previously, Ms. Stein was chair of the Association of Corporate Counsel, co-chair of the General Counsel Committee of the ABA Business Law Section and a director of the Pittsburgh Ballet Theater. Ms. Stein has received the Margaret Brent Award, the American Bar Association’s highest award for women lawyers; the Sandra Day O’Connor Board Excellence Award; and the Corporate Board Member America’s Top General Counsel Recognition Award. Ms. Stein received her J.D. from Harvard Law School, and is a graduate of Dartmouth College where she earned an undergraduate and master’s degrees.
	Executive
	Vice-President –
	General Counsel
	The Clorox Company
	Age: 53 (1)
	California, U.S.A.
	Director Since:
	April 23, 2014
	Independent

Principal Competencies
• Legal
• Engineering/Environment
• Finance/Accounting

MEMBER OF (6)	ATTENDANCE 2014	OTHER PUBLIC BOARDS DURING PAST 5 YEARS
Board	100%	Franklin Resources Inc.	(2005-present)
Audit Committee	100%
Environment, Safety & Security Committee	100%
Finance Committee	100%
Human Resources and Compensation Committee	100%
Strategic Planning Committee	100%
		SECURITIES HELD
2014 VOTES IN FAVOUR	99.79%	VALUE AT RISK	C$571,406 (3)

Common Shares Owned or Controlled (2)
February 2015	6,610
February 2014	NIL

(1)	The age of the directors is provided as at April 21, 2015, the date of the Meeting.

(2)

The information regarding common shares beneficially owned, controlled or directed has been furnished by the respective nominees individually and includes Deferred Share Units (“DSUs”) under the Deferred Share Unit Plan for Directors (“DSU Plan”) in the case of non-executive directors. In the case of Claude Mongeau it includes DSUs under the Company’s Voluntary Incentive Deferral Plan (“VIDP”) but does not include common shares under stock options. For further details on the VIDP, please see the Deferred Compensation Plans section and for further information on the DSU Plan, please see the “Board of Directors Compensation” section of this Information Circular.

(3)

The Value at Risk represents the total value of common shares and DSUs which total value is based on the February 27, 2015 closing price of the common shares on the Toronto Stock Exchange (C$86.35) or, for Donald J. Carty, Ambassador Gordon D. Giffin, Edith E. Holiday, James E. O’Connor and Laura Stein, the New York Stock Exchange (U.S.$69.14) using the closing exchange rate (U.S.$1.00 = C$1.2503) on the same date.

(4)	The information regarding stock options comprises the stock options granted to Claude Mongeau under the Management Long-Term Incentive Plan. For further details on the plan, please see the “Statement of Executive Compensation” section of this Information Circular.

(5)	The Donations and Sponsorships Committee and the Investment Committee of CN’s Pension Trust Funds are mixed committees composed of both members of the Board of Directors as well as officers of the Company.

(6)	For a detailed review of the Board and committee attendance by director nominees, please refer to the Attendance Table found in the Statement of Governance Practices of this Information Circular.

ADDITIONAL DISCLOSURE RELATING TO DIRECTORS

As of the date hereof, to the knowledge of the Company and based upon information provided to it by the nominees for election to the Board of Directors, no such nominee is or has been, in the last 10 years, a director or executive officer of any company that, while such person was acting in that capacity or within a year of that person ceasing to act in that capacity, became bankrupt, made a proposal under any legislation relating to bankruptcy or insolvency or was subject to or instituted any proceedings, arrangement or compromise with creditors or had a receiver, receiver manager or trustee appointed to hold its assets, except for the following:

(i)

Mr. Mongeau, a director and the President and Chief Executive Officer of the Company, became a director of Nortel Networks Corporation (“NNC”) and Nortel Networks Limited (“NNL”) on June 29, 2006. On January 14, 2009, NNC, NNL and certain other Canadian subsidiaries initiated creditor protection proceedings under the CCAA in Canada. Certain U.S. subsidiaries filed voluntary petitions in the United States under Chapter 11 of the U.S. Bankruptcy Code, and certain Europe, Middle East and Africa subsidiaries made consequential filings in Europe and the Middle East. Mr. Mongeau resigned as a director of NNC and NNL effective August 10, 2009;

(ii)

Ms. Kempston Darkes, a director of the Company, was an officer of General Motors Corporation (“GM”) when GM filed for bankruptcy protection under Chapter 11 of the U.S. Bankruptcy Code on June 1, 2009. None of the operations for which she was directly responsible in Latin America, Africa and the Middle East were included in the bankruptcy filing. GM emerged from bankruptcy protection on July 10, 2009 in a reorganization in which a new entity acquired GM’s most valuable assets. Ms. Kempston Darkes retired as a GM officer on December 1, 2009;

(iii)

Mr. Giffin, a director of the Company, was a director of AbitibiBowater Inc. until January 22, 2009. AbitibiBowater Inc. and certain of its U.S. and Canadian subsidiaries filed voluntary petitions in the United States under Chapter 11 of the U.S. Bankruptcy Code on April 16, 2009. AbitibiBowater Inc. and certain of its Canadian subsidiaries filed for creditor protection under the CCAA in Canada on April 17, 2009. Mr. Giffin is no longer a director of AbitibiBowater Inc.; and

(iv)

Mr. Losier, a director of the Company, was a director of XL-ID Solutions Inc. (formerly, Excellium Inc.) (“XL-ID”) from July 23, 2013 to August 29, 2013. On January 3, 2014, XL-ID announced that it had submitted a proposal to its creditors under the Bankruptcy and Insolvency Act (Canada). On February 13, 2014, XL-ID announced that it had received a final order from the Superior Court of Quebec approving the proposal approved by its creditors.

CN MANAGEMENT INFORMATION CIRCULAR 2015

15 directors’ compensation moves to a “flatfee” structure eliminating meeting and travel attendance fees in line with market best practices.

BOARD OF DIRECTORS COMPENSATION

CN’s compensation program is designed to attract and retain the most qualified people to serve on CN’s Board and its committees and takes into account the risks and responsibilities of being an effective director. To reflect the Company’s extensive operations in the United States and the Company’s need to attract and retain directors with experience in doing business in the U.S., the compensation of the non-executive directors of the Company is designed to be comparable to that of large U.S.-based companies.

The Board sets the compensation of non-executive directors based on the Corporate Governance and Nominating Committee’s recommendations. This Committee regularly reviews the compensation of non-executive directors and recommends to the Board such adjustments as it considers appropriate and necessary to recognize the workload, time commitment and responsibility of the Board and committee members and to remain competitive with director compensation trends in Canada and the U.S. Any director who is also an employee of the Corporation or any affiliates does not receive any compensation as a director.

The Corporate Governance and Nominating Committee undertook in 2014 a review of compensation arrangements for non-executive directors, which had last been reviewed in 2011. In October 2014, the Corporate Governance and Nominating Committee retained the services of Towers Watson to provide expertise and advice on a compensation market review for the non-executive directors. For this study, the Corporate Governance and Nominating Committee asked Towers Watson to assist in the determination of the appropriate comparator groups for CN non-executive directors, review the level and form of directors’ compensation for the comparator groups, and review the trends in level and form of director compensation in Canada and the U.S.

COMPARATOR GROUPS

Towers Watson compared CN’s non-executive directors compensation against three separate comparator groups: (i) selected Class I Railroads (see following table) composed of the same companies used for benchmarking the Named Executive Officers’ compensation, given CN is one of the Class I Railroads; (ii) a Canadian peer group of companies (see following table) selected by screening for companies with comparable size to CN in terms of revenues and market capitalization, given CN is a Canadian company competing to attract and retain Canadian directors; and (iii) the U.S. companies comprised of the Standard and Poor’s 500 Index, given CN’s extensive operations in the U.S. and because CN needs to attract and retain several U.S.-based directors. When compared to these comparator groups, Towers Watson indicated that CN’s compensation for non-executive directors is well-aligned with the upper end of each of these comparator groups.

Selected Class I Railroads

COMPANY NAME
Union Pacific Corporation (U.S.)	Norfolk Southern Corporation (U.S.)
Canadian Pacific Railway Ltd. (Cdn.)	CSX Corporation (U.S.)

Canadian Peer Group of Companies

COMPANY NAME	PRIMARY INDUSTRY	COMPANY NAME	PRIMARY INDUSTRY
Agrium Inc.	Chemicals	CGI Group Inc.	IT services
Air Canada	Airlines	Manulife Financial Corporation	Insurance
Bank of Montreal	Banks	Potash Corporation of Saskatchewan	Chemicals
Barrick Gold Corporation	Metals & Mining	Rogers Communications Inc.	Diversified Telecommunication
BCE Inc.	Diversified Telecommunication	Sun Life Financial Inc.	Insurance
Bombardier Inc.	Aerospace & Defense	Suncor Energy Inc.	Oil, Gas and Consumable Fuels
Canadian Imperial Bank of Commerce	Banks	Teck Resources Ltd.	Metals & Mining
Canadian Natural Resources Ltd.	Oil, Gas and Consumable Fuels	Telus Corporation	Diversified Telecommunication
Canadian Pacific Railway Ltd.	Road & Rail	Thomson Reuters Corporation	Media
Canadian Tire Corporation	Multiline Retail	TransCanada Corporation	Oil, Gas and Consumable Fuels
Cenovus Energy Inc.	Oil, Gas and Consumable Fuels

CHANGES TO COMPENSATION

Following the compensation review, the Board, upon the advice of the Corporate Governance and Nominating Committee, approved revisions to non-executive directors’ compensation, effective as of January 1, 2015, which consists of the adoption of an all-inclusive annual retainers structure. Board and committee meeting attendance fees as well as travel attendance fees are eliminated and such variable compensation is now included in the existing Board and committee retainers which have been increased slightly given that they now apply regardless of the number of meetings attended by directors and that this new flat fee compensation structure has been set for the next two years. This approach is consistent with compensation trend of the comparator groups, adds predictability of compensation to non-executive directors, and is simpler to administer.

In 2015 directors’ compensation moves to a “flat-fee” structure eliminating meeting and travel attendance fees in line with market best practices.

16	CN MANAGEMENT INFORMATION CIRCULAR 2015

COMPENSATION LEVELS

The following table shows the compensation levels for CN’s non-executive directors during 2014, together with the new compensation levels as discussed above, effective as of January 1, 2015 (such new levels to remain the same for two years):

	FEES (U.S.$)	FEES (U.S.$)	(1) The Board Chair receives no additional director retainer nor committee chair or committee member retainer. (2) Directors (including Board Chair) may choose to receive all or part of their cash retainer in common shares or DSUs (see compensation table below for details) and their common share grant retainer can also be received in DSUs. The common shares are purchased on the open market. (3) Committee chairs receive no additional committee chair or committee member retainer in 2014. (4) The committee member retainer in 2014 was paid on a per-committee basis. (5) Directors are reimbursed for expenses incurred in attending Board and committee meetings.
TYPE OF FEE	2014	2015
Board Chair Cash Retainer (1) (2)	120,000	175,000
Board Chair Share Grant Retainer (1) (2)	350,000	375,000
Director Cash Retainer (2)	15,000	35,000
Director Share Grant Retainer (2)	175,000	200,000
Committee Chair Cash Retainers (2)
Audit and HRC Committees Chairs	25,000(3)	75,000
Other Committees Chairs	15,000(3)	65,000
Committee Member Cash Retainer (2)	3,500(4)	55,000
Board Meeting Attendance Fee	1,500	N/A
Committee Meeting Attendance Fee	1,500	N/A
Travel Attendance Fee (5)	1,500	N/A

COMPENSATION TABLE

The table below reflects in detail the compensation earned by non-executive directors in the 12-month period ended December 31, 2014.

	FEES EARNED								PERCENT-
	DIRECTOR								AGE OF
	BOARD			BOARD AND					TOTAL FEES
	VICE-CHAIR			COMMITTEE					RECEIVED
	AND	COMMITTEE	COMMITTEE	ATTENDANCE	SHARE-	ALL OTHER			IN COMMON
	BOARD CHAIR	CHAIR	MEMBER	AND TRAVEL	BASED	COMPEN-			SHARES
	RETAINER	RETAINER	RETAINER	FEES	AWARDS	SATION		TOTAL	AND/OR
NAME OF DIRECTOR	(C$)(1)	(C$)(1)	(C$)(1)	(C$)(1)(2)	(C$)(3)	(C$)(4)		(C$)	DSUs(6)
Current Directors
A. Charles Baillie	16,646	16,646	15,536	61,300	194,198	–		304,326	80%
Donald J. Carty	16,646	18,409	19,420	66,270	194,198	4,970		319,913	72%
Ambassador Gordon D. Giffin	16,568	27,613	14,174	69,584	194,198	1,657		323,794	60%
Edith E. Holiday	16,568	–	19,329	66,270	194,198	–		296,365	66%
V. Maureen Kempston Darkes	16,568	16,568	15,463	67,927	194,198	–		310,724	62%
The Hon. Denis Losier	16,568	20,249	16,752	71,240	194,198	3,314		322,321	60%
The Hon. Edward C. Lumley	16,568	16,568	12,886	62,957	194,198	–		303,177	64%
The Hon. Kevin G. Lynch	11,025	–	12,863	49,703	128,625	–		202,216	75%
James E. O’Connor	16,568	11,045	16,752	69,584	194,198	1,657		309,804	63%
Robert Pace (8)	92,803	9,204	6,445	67,927	321,481	3,609		501,469	82%
Robert L. Phillips	10,952	–	12,778	48,046	127,774	4,970		204,520	74%
Laura Stein	10,894	–	12,710	49,703	127,097	–		200,404	71%
Retired Directors
Michael R. Armellino (7)	5,523	5,523	6,443	26,508	64,732	–		108,729	60%
Hugh J. Bolton (7)	5,523	5,523	5,155	23,195	64,732	–		104,128	62%
David G.A. McLean (7)	44,180	–	–	23,195	129,465	570	(5)	197,410	66%
TOTAL	313,600	147,348	186,706	823,409	2,517,490	20,747		4,009,300	69%

(1)

All directors earned compensation in U.S. currency. Compensation received in cash was converted to Canadian dollars using the average rate of exchange of the Bank of Canada for 2014 (U.S.$1.00 = C$1.1045). Compensation elected to be received in common shares or DSUs was converted to Canadian dollars using the closing rate of exchange of the Bank of Canada (U.S.$1.00 = C$1.1097), on the purchase day (February 3, 2014). Robert Pace’s election for such compensation as Chair of the Board was converted to Canadian dollars using the closing rate of exchange of the Bank of Canada on May 13, 2014 (U.S.$1.00 = C$1.0910). The Hon. Kevin G. Lynch, Robert L. Phillips and Laura Stein election for such compensation was converted to Canadian dollars using the closing rate of exchange of the Bank of Canada respectively on April 28, 2014 (U.S.$1.00 = C$1.1025), on May 5, 2014 (U.S.$1.00 = C$1.0952) and on May 7, 2014 (U.S.$1.00 = C$1.0894). In addition to the common shares or DSUs received by the directors, the Board Vice-Chair, and the Board Chair, as described in note (3) below, the directors, the Board Vice-Chair and the Board Chair may choose to receive all or part of their cash retainers in common shares or DSUs. The following directors made such election with respect to the amounts set forth beside their names: A. Charles Baillie (C$48,828), Donald J. Carty (C$36,066), the Hon. Kevin G. Lynch (C$23,888), Robert Pace (C$87,280), Robert L. Phillips (C$23,730) and Laura Stein (C$15,861). The amount of cash retainers elected to be received in common shares or DSUs is included in these columns.

(2)	Includes travel fees which amounted to a total of C$165,675, in aggregate, for all directors.

(3)

Represents a common share grant valued at U.S.$175,000 received by each non-executive director as part of the Director Retainer, U.S.$175,000 for the Board Vice-Chair as part of the Board Vice-Chair Retainer, and U.S.$350,000 for the Board Chair as part of the Board Chair Retainer. Such values were converted to Canadian dollars using the closing rate of exchange of the Bank of Canada (U.S.$1.00 = C$1.1097) on February 3, 2014. The Hon. Kevin G. Lynch, Robert L. Phillips and Laura Stein election for such compensation was converted to Canadian dollars using the closing rate of exchange of the Bank of Canada respectively on April 28, 2014 (U.S.$1.00 = C$1.1025), on May 5, 2014 (U.S.$1.00 = C$1.0952) and on May 7, 2014 (U.S.$1.00 = C$1.0894).

CN MANAGEMENT INFORMATION CIRCULAR 2015

(4)	Such values represent committee attendance fees received in cash for attendance to meetings of board committees of which they were not members. Such values were converted to Canadian dollars using the average rate of exchange of the Bank of Canada for 2014 (U.S.$1.00 = C$1.1045).

(5)

Includes the value of insurance premiums for 2014. For Robert Pace: for North American emergency protection outside his province of residence, the annual cost to the Company for such benefits was C$295 (based on an annual premium of C$1,792). For David G.A. McLean: for insurance premiums for medical and dental coverage in Canada and the U.S., the total cost to the Company was C$570 (based on total annual premiums of C$1,841).

(6)	This percentage is calculated by dividing the aggregate of the cash retainer elected by non-executive directors to be received in common shares or DSUs described in note (1) above and the value provided under the share-based awards column, by the value provided under the total column.

(7)	Michael R. Armellino, Hugh J. Bolton and David G.A. McLean retired from the Board on April 23, 2014.

(8)	Robert Pace became Chair of the Board on April 23, 2014. Prior to this date, he had been Board Vice-Chair since April 23, 2013.

SHARE OWNERSHIP

The directors of the Company play a central role in enhancing shareholder value and each has a substantial investment in the Company. The Board has adopted a guideline to the effect that each non-executive director should own, within five years of joining the Board, common shares, Deferred Share Units (“DSUs”) or similar share equivalents of CN, if any, (“CN Securities”) with a value of at least the higher of: (i) C$500,000, or (ii) three times the aggregate of the annual director retainer (which includes cash and the value of any grant of CN Securities and in the case of the Board Chair, the aggregate of the annual Board Chair retainer in cash and the value of any grant of CN Securities) (the “Minimum Shareholding Requirement”). Each non-executive director is required to continue to hold such value throughout his or her tenure as a director and the CN Securities held to comply with the Minimum Shareholding Requirement shall not be, during the director tenure, the object of specific monetization procedures or other hedging procedures to reduce the exposure related to his or her holding.

Each non-executive director is required to receive at least 50% of his or her annual director, committee, Board Chair and committee chair cash retainers in CN Securities and may elect to receive up to 100% of such retainers in CN Securities until his or her Minimum Shareholding Requirement is met. Once the Minimum Shareholding Requirement is met, directors may elect to receive up to 100% of such retainers in CN Securities.

Directors are required to be paid at least 50% in the form of equity until they attain their share ownership requirements.

Changes to Share Ownership

In connection with the changes made to the compensation structure, effective with this year’s Meeting, the share ownership requirements for non-executive directors include a new feature to the effect that each director is required to continue to hold CN Securities with a value of at least the higher of: (i) C$250,000 or (ii) 50% of the Minimum Shareholding Requirement, for a period of 2 years after the director leaves the Board.

Approximately 69% of the total annual compensation of the non-executive directors for 2014 was in the form of CN Securities. As of the date hereof, the average value of CN Securities owned by non-executive directors is approximately C$11.5 million (based on the February 27, 2015, closing price of the common shares of the Company on the Toronto Stock Exchange (C$86.35), or the New York Stock Exchange (U.S.$69.14) for U.S. directors).

Directors’ ownership requirement for two years beyond board tenure aligns with longer term stewardship.

18	CN MANAGEMENT INFORMATION CIRCULAR 2015

SHARE OWNERSHIP TABLE

The following table provides information on the number and the value of common shares and DSUs owned by the Company’s current directors as at February 27, 2015, and the amount needed to meet the Minimum Shareholding Requirement.

DIRECTOR	YEAR (1)	NUMBER OF COMMON SHARES OWNED, CONTROLLED OR DIRECTED	2015 TOTAL VALUE OF COMMON SHARES (VALUE AT RISK)(3) (C$)	NUMBER OF DSUs HELD	2015 TOTAL VALUE OF DSUs (VALUE AT RISK)(3) (C$)	TOTAL NUMBER OF COMMON SHARES OWNED, CONTROLLED OR DIRECTED AND DSUs (2)	2015 TOTAL VALUE OF COMMON SHARES AND DSUs (VALUE AT RISK) (3) (C$)	GUIDELINE MET OR INVESTMENT REQUIRED TO MEET GUIDELINE (C$)	VALUE AT RISK AS MULTIPLE OF SHAREHOLDING REQUIREMENT
A. Charles Baillie	2015	207,400		122,330		329,730
	2014	207,400	17,908,990	119,166	10,563,196	326,566	28,472,186	✓	32
	Variation	–		3,164		3,164
Donald J. Carty	2015	37,620		19,047		56,667
	2014	20,000	3,252,089	18,785	1,646,532	38,785	4,898,621	✓	6
	Variation	17,620		262		17,882
Ambassador	2015	42,493		44,772		87,265
Gordon D. Giffin	2014	40,118	3,673,339	43,564	3,870,349	83,682	7,543,688	✓	9
	Variation	2,375		1,208		3,583
Edith E. Holiday	2015	73,341		28,396		101,737
	2014	73,341	6,340,017	25,049	2,454,713	98,390	8,794,730	✓	10
	Variation	–		3,347		3,347
V. Maureen	2015	127,368		52,096		179,464
Kempston Darkes	2014	124,590	10,998,227	51,379	4,498,490	175,969	15,496,717	✓	18
	Variation	2,778		717		3,495
The Hon. Denis Losier	2015	184,254		104,278		288,532
	2014	184,254	15,910,333	99,883	9,004,405	284,137	24,914,738	✓	28
	Variation	–		4,395		4,395
The Hon.	2015	121,370		89,387		210,757
Edward C. Lumley	2014	123,370	10,480,300	87,170	7,718,567	210,540	18,198,867	✓	21
	Variation	(2,000)		2,217		217
The Hon.	2015	–		6,752		6,752
Kevin G. Lynch	2014	–	–	–	583,035	–	583,035	298,427	0.7
	Variation	–		6,752		6,752
Claude Mongeau	2015	66,503		411,150		477,653
	2014	64,496	5,742,534	405,486	35,502,803	469,982	41,245,337	✓	see note 4
	Variation	2,007		5,664		7,671
James E. O’Connor	2015	21,678		–		21,678
	2014	18,668	1,873,971	–	–	18,668	1,873,971	✓	2
	Variation	3,010		–		3,010
Robert Pace	2015	200,557		98,567		299,124
	2014	191,715	17,318,097	97,211	8,511,260	288,926	25,829,357	✓	13
	Variation	8,842		1,356		10,198
Robert L. Phillips	2015	5,625		6,752		12,377
	2014	4,125	485,719	–	583,035	4,125	1,068,754	✓	1
	Variation	1,500		6,752		8,252
Laura Stein	2015	–		6,610		6,610
	2014	–	–	–	571,406	–	571,406	310,056	0.6
	Variation	–		6,610		6,610

(1)	The number of common shares and DSUs held by each director for 2015 is set out as at February 27, 2015, and for 2014 is set out as at February 28, 2014.

(2)	Includes DSUs elected as part of directors compensation and DSUs under the Company’s VIDP held by Claude Mongeau.

(3)

The total value is based on the February 27, 2015 closing price of the common shares on the Toronto Stock Exchange (C$86.35) or, for Donald J. Carty, Ambassador Gordon D. Giffin, Edith E. Holiday, James E. O’Connor and Laura Stein, the New York Stock Exchange (U.S.$69.14) using the closing exchange rate (U.S.$1.00 = C$1.2503) on the same date.

(4)	For a discussion on Claude Mongeau’s shareholding requirements, please see the section “Stock Ownership Status” on p. 49 of this Information Circular.

DIRECTORS’ DEFERRED SHARE UNIT PLAN

Subject to the Minimum Shareholding Requirement, directors may elect to receive all or part of their director, committee member, Board Chair, and committee chair cash retainers either in cash, common shares of the Company purchased on the open market or DSUs. They may also elect to receive their common share grant retainer in DSUs. Each DSU entitles the beneficiary thereof to receive upon resignation, retirement or death, one common share of the Company purchased on the open market, plus additional DSUs reflecting dividend equivalents.

Each director has an account where notional DSUs are credited and held until the director leaves the Board. The number of DSUs credited to each director’s account is calculated by dividing the elected amount of the director, committee member, Board Chair, and committee chair cash and common share retainers by the common share price on the day the credit is made.

Participants in the DSU Plan are credited additional DSUs that are equivalent to the dividends declared on the Company’s common shares. Such additional DSUs are credited to each non-executive director’s account on each dividend payment date. The number of DSUs is calculated using the same rate as for the dividends paid on the common shares.

When a director leaves the Board, the Company buys the same number of common shares on the open market as the number of DSUs the director holds in the DSU Plan, after deducting appropriate taxes. These shares are then delivered to the former director. All administration costs as well as any brokerage fees associated with the purchase and registration of common shares are paid by CN.

CN MANAGEMENT INFORMATION CIRCULAR 2015

STATEMENT OF CORPORATE GOVERNANCE PRACTICES

GENERAL

We are committed to adhering to the highest standards of corporate governance and our corporate governance practices were designed in a manner consistent with this objective. The role, specific mandate and functioning rules of the Board of Directors and of each of its committees are set forth in our Corporate Governance Manual which was formally approved by the Board of Directors on January 21, 2003, and last amended on March 10, 2015. Our Corporate Governance Manual is available on our website at www.cn.ca, under Delivering Responsibly/Governance. It is revised regularly with a view of continually improving our practices by assessing their effectiveness and comparing them with evolving practices, changing circumstances and our needs. Our Corporate Governance Manual forms part of the documentation given to all persons elected or appointed to the Board of Directors.

As a Canadian reporting issuer with securities listed on the Toronto Stock Exchange (“TSX”) and the New York Stock Exchange (“NYSE”), our corporate governance practices comply with applicable rules adopted by the Canadian Securities Administrators (the “CSA”), applicable provisions of the U.S. Sarbanes-Oxley Act of 2002 (the “Sarbanes-Oxley Act”) and related rules of the U.S. Securities and Exchange Commission (“SEC”). We are exempted from complying with many of the NYSE corporate governance rules, provided that we comply with Canadian governance requirements. Except as summarized on our website at www.cn.ca, under Delivering Responsibly/Governance, our governance practices comply with the NYSE corporate governance rules in all significant respects.

The CSA adopted, in June 2005, National Instrument 58-101— Disclosure of Corporate Governance Practices (as amended from time to time, the “Disclosure Instrument”) and National Policy 58-201— Corporate Governance Guidelines (as amended from time to time, the “Governance Policy”). The Governance Policy provides guidance on governance practices to Canadian issuers, while the Disclosure Instrument requires issuers to make the prescribed disclosure regarding their own governance practices. The Company believes that its corporate governance practices meet and exceed the requirements of the Disclosure Instrument and the Governance Policy. The text set forth hereunder refers to the items of the Disclosure Instrument as well as to the guidelines of the Governance Policy, where applicable. The Company also refers, where appropriate, to the NYSE Corporate Governance Standards (the “NYSE Standards”).

The Board of Directors is of the opinion that the Company’s corporate governance practices are well designed to assist the Company in achieving its principal corporate objective, which is the enhancement of shareholder value. The mandate of the Board is set out in Schedule “A” to this Information Circular. The Board of Directors has approved the disclosure of the Company’s governance practices described below, on the recommendation of the Corporate Governance and Nominating Committee.

The role, mandate and rules of the Board of Directors and of its committees are set forth in our corporate governance manual, a detailed document available on our website. CN is one of the few issuers in Canada with such a comprehensive governance manual publicly available.

CODE OF BUSINESS CONDUCT

The Board of Directors reviews and updates our Code of Business Conduct to ensure that it is consistent with current industry trends and standards; clearly communicates CN’s organizational mission, values, and principles; and, most importantly, serves as a reference guide for employees to support everyday decision making. The Code is applicable to directors, officers and employees of CN. It addresses many important matters, including conflicts of interest, protection and proper use of corporate assets and opportunities, confidentiality of corporate information, fair dealing, compliance with laws and reporting of any illegal or unethical behaviour. No waiver has ever been granted to a director or executive officer in connection therewith. The Code of Business Conduct is available on our website at www.cn.ca, under Delivering Responsibly/Governance and in print to any shareholder who requests a copy by contacting our Corporate Secretary. The Code has also been filed with the Canadian and U.S. securities regulatory authorities.

The Board, through its Corporate Governance and Nominating Committee, reviews, monitors and oversees the disclosure relating to the Company’s Code of Business Conduct. Each year, management reports to such committee on the implementation of the Code of Business Conduct within the organization and on any material contravention of the Code of Business Conduct by employees of the Company.

The Board requests that every director disclose any direct or indirect interest he or she has in any organization, business or association, which could place the director in a conflict of interest. Every year, a questionnaire is sent to each director to ensure that the director is in no such conflict that has not been disclosed. Should there be a discussion or decision relating to an organization, business or association in which a director has an interest, the Board will request that such director not participate or vote in any such discussion or decision.

The Company believes that ethical business conduct is an important part of its success. Hence, the mandate of the Board attached as Schedule “A” to this Information Circular states that the Board has the responsibility for overseeing management in the competent and ethical operation of the Company. As part of the Company’s Code of Business Conduct, employees are also required to avoid outside interests that may impair or appear to impair the effective performance of their responsibilities to the Company, and be fair and impartial in all dealings with customers, suppliers and partners. A key person in the implementation of the Company’s Code of Business Conduct is CN’s Ombudsman, who presents reports to the Corporate Governance and Nominating Committee. The office of the Ombudsman offers a confidential, neutral and informal avenue which facilitates fair and equitable resolutions to concerns arising within the Company.

The Board of Directors has adopted procedures allowing interested parties to communicate directly with the Board Chair.

20	CN MANAGEMENT INFORMATION CIRCULAR 2015

The Board of Directors also adopted procedures allowing interested parties (i) to submit accounting and auditing complaints or concerns to us and (ii) to communicate directly with the Board Chair, who presides over all non-executive director sessions. These procedures are described on our website at www.cn.ca, under Delivering Responsibly/Governance. The Code of Business Conduct provides that concerns of employees regarding any potential or real wrongdoing in terms of accounting or auditing matters may be submitted confidentially through CN’s Hotline.

INDEPENDENCE OF DIRECTORS

To better align the interests of the Board of Directors with those of our shareholders, all of the nominees for election to the Board of Directors, except our President and Chief Executive Officer, are independent. In determining whether a director is an independent director, the Board of Directors applies the standards developed by the Canadian securities regulatory authorities, the NYSE and the additional standards adopted by the Board. These standards are set out in CN’s Corporate Governance Manual which is available on our website at www.cn.ca, under Delivering Responsibly/Governance.

As shown in the following table, 10 of the 11 nominees for election to the Board of Directors are independent:

	INDEPENDENCE STATUS
NAME	INDEPENDENT	NOT INDEPENDENT	REASON FOR NON-INDEPENDENCE STATUS
Donald J. Carty	✓
Ambassador Gordon D. Giffin	✓
Edith E. Holiday	✓
V. Maureen Kempston Darkes	✓
The Hon. Denis Losier	✓
The Hon. Kevin G. Lynch	✓
Claude Mongeau			President and Chief
		✓	Executive Officer
			of the Company
James E. O’Connor	✓
Robert Pace	✓
Robert L. Phillips	✓
Laura Stein	✓

INDEPENDENT CHAIR OF THE BOARD

The Company’s Board has been led by a non-executive Chair since it became public in 1995 and we believe that the separation of the positions of President and Chief Executive Officer and Chair of the Board contributes to allowing the Board to function independently of management. Hence, our Corporate Governance Manual provides that the Board Chair must be an independent director who is designated by the Board. Mr. Robert Pace is the independent Board Chair. The Corporate Governance Manual describes the responsibilities of the Chair of the Board. The key role of the Board Chair is to take all reasonable measures to ensure that the Board (i) has structures and procedures in place to enable it to function independently of management; (ii) carries out its responsibilities effectively; and (iii) clearly understands and respects the boundaries between the responsibilities of the Board and those of management. Mr. Pace became Chair of the Board on April 23, 2014.

10 of the 11 nominees for election to the Board of Directors are independent.

POSITION DESCRIPTIONS

Our Corporate Governance Manual includes position descriptions for the Board Chair and the Committee Chairs, as well as a position description for the President and Chief Executive Officer of the Company.

COMMITTEES OF THE BOARD

Given our size, the nature and geographical scope of our activities and the great number of laws and regulations to which we are subject, the Board of Directors has subdivided its supervision mandate into six areas and has established committees that have certain responsibilities for such areas. These committees are the Audit Committee, the Finance Committee, the Corporate Governance and Nominating Committee, the Human Resources and Compensation Committee, the Environment, Safety and Security Committee and the Strategic Planning Committee and their charters are available as part of CN’s Corporate Governance Manual. The Board of Directors also established the Investment Committee of CN’s Pension Trust Funds and the Donations and Sponsorships Committee, which are mixed committees composed of members of the Board of Directors as well as officers of the Company. All committees report to the Board of Directors and, subject to certain limited exceptions, there are no standing delegations of the Board of Directors’ decision-making authority to committees.

The following is a brief summary of the mandate of each committee of the Board of Directors.

Schedule “B” to this Information Circular provides reports on the activities of each Board Committee.

Audit Committee

The Audit Committee has the responsibility of overseeing the Company’s financial reporting, monitoring risk management, internal controls and internal and external auditors. The mandate of the Audit Committee is further described in the section entitled “Statement of Corporate Governance Practices — Audit Committee Disclosure” on page 32 of this Information Circular and in the charter of such committee which is included in our Corporate Governance Manual. The charter of the Audit Committee provides that such Committee must be composed solely of independent directors. As at February 27, 2015, all members of the Audit Committee are independent.

Finance Committee

The Finance Committee has the responsibility of overseeing the Company’s financial policies, and authorizing, approving and recommending financial activities. As part of these responsibilities, the Finance Committee provides oversight with respect to our capital structure, dividend policy, share repurchase program, cash flows and key financial ratios, reviews the opportunities and parameters for debt or equity financing, reviews financing documents and, within the scope of its authority levels established by the Board, may authorize the borrowing of money, the issuing of debt securities or other forms of financing, and makes recommendations to the Board thereon. The responsibilities, powers and operation of the Finance Committee are further described in the charter of such Committee which is included in our Corporate Governance Manual.

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Corporate Governance and Nominating Committee

The Corporate Governance and Nominating Committee has the responsibility of monitoring the composition of the Board of Directors and its committees and overseeing corporate governance matters. As part of its responsibilities, the Corporate Governance and Nominating Committee develops, reviews and monitors criteria for selecting directors, including required or desired competencies and skills to improve the Board of Directors and, in consultation with the Board Chair, identifies candidates qualified to become Board members.

This Committee reviews the corporate governance guidelines applicable to the Company, recommends any change that should be made thereto and monitors the disclosure of its practices. The responsibilities, powers and operation of the Corporate Governance and Nominating Committee are further described in the charter of such Committee which is included in our Corporate Governance Manual.

The charter of the Corporate Governance and Nominating Committee provides that such Committee must be composed solely of independent directors. As at February 27, 2015, all members of the Corporate Governance and Nominating Committee are independent.

Human Resources and Compensation Committee

The Human Resources and Compensation Committee has the responsibility of monitoring executive management’s performance assessment and succession planning. This Committee also has the mandate to review human resources practices by ensuring, amongst other things, that appropriate human resources systems are in place so that the Company can attract, motivate and retain the quality of personnel required to meet its business objectives. The mandate of the Human Resources and Compensation Committee is further described in the section entitled “Statement of Executive Compensation — Human Resources and Compensation Committee” on page 36 of this Information Circular and in the charter of such Committee which is included in our Corporate Governance Manual. The charter of the Human Resources and Compensation Committee provides that such Committee must be composed solely of independent directors. As at February 27, 2015, all members of the Human Resources and Compensation Committee are independent.

The Board has adopted a policy, which is included in our Corporate Governance Manual, that no more than one in three members of the Human Resources and Compensation Committee shall be a sitting CEO of another company, at least one member shall be experienced in executive compensation, and the President and CEO of the Company shall be excluded from the Committee member selection process.

Reference is also made to the subsection entitled “Statement of Executive Compensation — Human Resources and Compensation Committee — Executive and Board Compensation Consultants” on page 38 of this Information Circular for disclosure in respect of executive compensation consultants.

Environment, Safety and Security Committee

The Environment, Safety and Security Committee has the responsibility, amongst other things, of overseeing the development and implementation of environmental, safety and security policies, assessing environmental, safety and security practices, and reviewing the Company’s business plan to ascertain whether environmental, safety and security issues are adequately taken into consideration. The responsibilities, powers and operation of the Environment, Safety and Security Committee are further described in the charter of such Committee which is included in our Corporate Governance Manual.

Strategic Planning Committee

The Strategic Planning Committee, which is composed of all of the Company’s Board Members, focuses on financial and strategic issues, including the review of the key assumptions, as well as the economic, business, regulatory and competitive conditions underlying the Company’s business plan. It also reviews, with the President and Chief Executive Officer and other appropriate executive officers, the Company’s business plan and capital budget prior to their formal approval by the Board of Directors. The responsibilities, powers and operation of the Strategic Planning Committee are further described in the charter of such Committee which is included in our Corporate Governance Manual.

Investment Committee of CN’s Pension Trust Funds

The Investment Committee of CN’s Pension Trust Funds, which is a mixed committee composed of directors and officers, has the responsibility, amongst other things, of reviewing the activities of the CN Investment Division, reviewing and approving the CN Investment Incentive Plan and award payouts thereunder, advising the CN Investment Division on investment of assets of CN’s Pension Trust Funds and approving certain of the investments made by CN’s Pension Trust Funds. The responsibilities, powers and operation of the Investment Committee of CN’s Pension Trust Funds are further described in the charter of such Committee which is included in our Corporate Governance Manual.

Donations and Sponsorships Committee

The Donations and Sponsorships Committee, which is a mixed committee composed of directors and officers, has the responsibility, amongst other things, of developing a donations and sponsorships strategy and for reviewing and approving donation and sponsorship requests. The responsibilities, powers and operation of the Donations and Sponsorships Committee are further described in the charter of such Committee which is included in our Corporate Governance Manual.

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RISK MANAGEMENT OVERSIGHT

At CN, the Board is entrusted with the responsibility for identifying and overseeing the significant risks to which CN’s business is exposed and ensuring there are processes in place to effectively identify, monitor and manage them. These processes seek to mitigate risk. A significant risk is generally defined as an exposure that has the potential to materially impact CN’s ability to meet or support its business objectives. The Board delegates responsibility for the execution of certain elements of the risk oversight program to committees of the Board in order to ensure appropriate expertise, attention and diligence, and reports to the Board in the ordinary course.

The Board has strong processes in place to identify and monitor the significant risks to which CN is exposed.

Management undertakes an enterprise-wide process to identify, classify, assess and report on CN’s significant risks and mitigation strategies. For a detailed explanation of the material risks applicable to CN and its affiliates, see the section entitled “Business risks” in CN’s Management’s Discussion and Analysis dated February 2, 2015 included in CN’s 2014 Annual Report, available on SEDAR at www.sedar.com, on EDGAR at www.sec.gov and on CN’s website at www.cn.ca.

Risk information is reviewed by committees of the Board and/or the Board throughout the year and Company Officers present updates on the execution of business strategies, risks and mitigation activities. The Audit Committee is responsible for ensuring that appropriate risk management processes are in place across the organization and it considers the effectiveness of the operation of CN’s internal control procedures and reviews reports from CN’s internal and external auditors. As part of its risk management process activities, the Audit Committee ensures that significant risks identified are referred to a Board committee or the Board for oversight, as appropriate. Specifically, the Audit Committee reviews the Company’s risk assessment and risk management policies including information technology risk management, business interruption management, and assists the Board with the oversight of the Company’s compliance with applicable legal and regulatory requirements. From a financial perspective, the Company is exposed to various risks such as customer credit risk, commodity price risk, interest rate risk, foreign currency risk, and liquidity risk. To manage these risks, CN follows a financial risk management framework, which is monitored and approved by the Finance Committee, with a goal of maintaining a strong balance sheet, optimizing earnings per share and free cash flow, financing CN’s operations at an optimal cost of capital and preserving the Company’s liquidity. The Finance Committee, as part of its responsibility to review CN’s liquidity position, also oversees pension funding risks. The Human Resources and Compensation Committee considers risks relating to compensation, succession planning and CN’s employee benefit obligations while the Environment, Safety and Security Committee considers risks related to environment, health and safety, and security.

BOARD AND COMMITTEE MEETINGS

Process

The Board Chair, in collaboration with the Corporate Secretary, has the responsibility of establishing a schedule for the meetings of the Board of Directors and its committees. During this process, the Corporate Secretary, in collaboration with the Board and committee chairs and the appropriate executive officers, establishes Board and committee working plans for the year. We believe that proceeding in this manner helps in the preparation of in-depth presentations conducive to meaningful information sessions and discussions while allowing management to plan ahead. If, during the course of the year, events or circumstances require Board or committee action or consideration, additional meetings are called. The total number of meetings and the attendance record for each director for all board and committee meetings held during the course of 2014 are set out in the section entitled “Nominees for Election to the Board — Board and Committee Attendance” of this Information Circular.

Board and Committee working plans are established for the year.

Communication regularly takes place between the Board Chair and the President and Chief Executive Officer and, through the Office of the Corporate Secretary, between executive officers having responsibilities for matters placed under the supervision of particular committees and the Chairs of such committees. This open communication ensures that all meaningful information concerning the affairs and progress of the Company are transmitted to those members of the Board of Directors or committees having special supervisory responsibilities.

In Camera Meetings

The independent Board members meet before or after every regular in-person meeting of the Board of Directors in in camera sessions, without the presence of management and under the chairmanship of the Board Chair. During the financial year ended December 31, 2014, there were 9 in camera sessions that were attended exclusively by non-executive directors.

In camera sessions are held by independent board members at every regular in-person meeting of the board of directors.

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BOARD AND COMMITTEE ATTENDANCE

Attendance Table

The following tables show the record of attendance by director at meetings of the Board and its committees, as well as the number of Board and Board committee meetings held during the 12-month period ended December 31, 2014.

	NUMBER AND % OF MEETINGS ATTENDED
DIRECTOR (1)	BOARD	AUDIT COMMITTEE	CORPORATE GOVERNANCE AND NOMINATING COMMITTEE	DONATIONS AND SPONSORSHIPS COMMITTEE	ENVIRONMENT, SAFETY AND SECURITY COMMITTEE	FINANCE COMMITTEE	HUMAN RESOURCES AND COMPENSATION COMMITTEE	INVESTMENT COMMITTEE OF CN’S PENSION TRUST FUNDS	STRATEGIC PLANNING COMMITTEE	COMMITTEES (TOTAL )	OVERALL ATTENDANCE
A. Charles Baillie(2)	9/9 (100%)	–	2/2	–	–	7/7 (Chair)	5/5	4/4	3/3	21/21 (100%)	30/30 (100%)
Donald J. Carty(3)	9/9 (100%)	5/5 (Chair)	5/5	–	3/3	3/3	3/3	1/1	3/3	23/23 (100%)	32/32 (100%)
Ambassador Gordon D. Giffin(4)	9/9 (100%)	5/5	–	3/3	2/2	3/3	5/5 (Chair)	4/4	3/3	25/25 (100%)	34/34 (100%)
Edith E. Holiday	9/9 (100%)	–	5/5	–	–	7/7	5/5	4/4	3/3	24/24 (100%)	33/33 (100%)
V. Maureen Kempston Darkes(5)	9/9 (100%)	3/3	3/3	–	5/5 (Chair)	4/4	5/5	1/1	3/3	24/24 (100%)	33/33 (100%)
The Hon. Denis Losier(6)	9/9 (100%)	5/5	5/5 (Chair)	1/1	2/2	–	5/5	4/4	3/3	25/25 (100%)	34/34 (100%)
The Hon. Edward C. Lumley(7)	9/9 (100%)	–	2/2	–	–	7/7	5/5<