Brief governance history

Prior to 1996

Wisconsin Energy Corporation embraces corporate governance as a process to fulfill its responsibility to oversee the corporation's business. The process is designed to ensure stockholder interests are considered, to help achieve and maintain corporate competitiveness and to contribute to the successful perpetuation of the corporation. This was accomplished through resolutions adopted at monthly Board meetings, as well as informal Board discussions. Formal written charters and governance guidelines are essentially undeveloped as is the case in most other companies.

1996 study

• In 1996, the WEC Board directed its Nominating and Board Affairs Committee (now known as the Corporate Governance Committee) to critically evaluate governance issues that could serve as the foundation for its governing documents, policies and procedures.
• The study started from a review of "best practices":
  • Reviewed companies that had appeared on the list of Best Boards.
  • Met with the corporate secretaries of these companies.
  • Determined what was important to Board effectiveness and what works and what doesn't.
• The study was conducted at the direction of the committee chair (Geneva Johnson) by the corporate secretary and her staff, and with the assistance of an outside consultant.
• The study also included a survey of individual directors, and asked:
  • What is working well?
  • What should we improve?
• The study resulted in the creation and adoption of a set of core governing documents and related processes:
  • WEC Corporate Governance Guidelines
  • Revisions and/or adoption of committee charters
  • Criteria for director selection
  • Annual Board self-evaluation process
  • Annual CEO evaluation process
  • Director Orientation Policy
  • Institution of more executive sessions
  • Increased payments to directors in stock without establishing ownership targets
  • Discussions on lead director concept vs. strong committee chairs
  • Discussions on term limits, mandatory retirement and policy regarding resignations due to change in employment status
• WEC guidelines have been extensively published.
  • Through external publications:
    • "How to Prepare Individualized Corporate Governance Guidelines for Your Company" (May 1997) Directorship ;
    • "Opening the Door to the New Age of Corporate Governance" (Mar/Apr 1997), The Corporate Board .
  • Through the Society of Corporate Secretaries & Governance Professionals, where the WEC guidelines have served as one of the models for such guidelines.
  • In the Company's proxy statement.

1996-present — evolving guidelines

Since 1996, the Corporate Governance Guidelines and Committee charters have been reviewed annually and have been modified based on evolving Board needs, results of the Board and Committee self evaluation process, increased shareholder activism, new regulations and best practices in the governance landscape.