POR » Topics » Compensation Discussion and Analysis

This excerpt taken from the POR DEF 14A filed Apr 3, 2009.
Compensation Discussion and Analysis
This section is intended to inform our shareholders about our 2008 executive compensation program, particularly as it relates to the following individuals, who were our “named executive officers” in 2008:
Position(s) Held in 2008
Peggy Y. Fowler
  Chief Executive Officer and President*
James J. Piro
  Executive Vice President Finance, Chief Financial Officer and Treasurer*
Stephen M. Quennoz
  Vice President, Nuclear and Power Supply/Generation
Stephen R. Hawke
  Senior Vice President, Customer Service and Delivery
Arleen N. Barnett
  Vice President, Administration
* Ms. Fowler resigned as President of the company effective January 1, 2009 and as Chief Executive Officer effective March 1, 2009, but continues to serve on our Board of Directors. Mr. Piro served as President and Co-Chief Executive Officer from January 1 through February 28, 2009 and has served as President and Chief Executive Officer since March 1, 2009.
I.   Roles and Responsibilities
The Compensation and Human Resources Committee (“Compensation Committee”) oversees the compensation of our executive officers. Each year the Compensation Committee reviews the performance of the executive officers and establishes base salaries and incentive awards. The committee also regularly reviews the company’s executive compensation programs and makes changes or recommends changes to the full Board of Directors. The report of the Compensation Committee relating to this Compensation Discussion and Analysis can be found on page 25 under the heading “Compensation and Human Resources Committee Report.” Additional information concerning the Compensation Committee is on page 15 under the subheading “Compensation and Human Resources Committee” and on page 17 under the subheading “Compensation Committee Interlocks and Insider Participation.”
The company’s executive officers do not set executive pay. On many compensation matters, however, our management provides information and recommendations to the Compensation Committee, particularly in areas requiring detailed knowledge of company operations and the utility industry. In 2008, several members of our management team assisted the committee with the development of performance goals for incentive awards. Ms. Fowler and Mr. Piro provided input on financial and operating results and the individual performance of the other executive officers. Our CEO does not make recommendations to the committee regarding his or her own compensation.
The Compensation Committee selected and retained an outside compensation consultant, Watson Wyatt Worldwide (“Watson Wyatt”), to assist with the development of the company’s executive compensation program. The committee has adopted a policy that executive compensation consultants may not be retained to perform other services for the company without the express permission of the committee. In 2008, Watson Wyatt provided input to the committee on compensation trends, appropriate comparison companies and market survey data. Watson Wyatt also assisted management in preparing recommendations to the committee regarding salaries, performance goals for the incentive award programs and other aspects of executive compensation.
II.   Goals and Guiding Principles
The goals of the company’s executive compensation program are to attract and retain highly qualified and motivated executives and to provide them with incentives to advance the interests of the company’s key


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constituents: our shareholders, our customers and the communities we serve. In attempting to accomplish these goals, the Compensation Committee is guided by the following principles:
  •  Incentive Pay
  •  Increasing degrees of responsibility should be accompanied by an increasing share of the risks and rewards of company performance.
  •  A significant portion of incentive awards should be equity-based and should vest over a period of several years. This further aligns our executives’ interests with the long-term interests of our shareholders.
  •  Targets for incentive awards should provide incentives for improvement in key areas, but should not promote rapid improvements at the expense of safety and reliability.
  •  Competitive Pay
  •  Executive pay packages should be competitive within the utility industry and organizations with which we compete for employees.
  •  To achieve competitiveness in executive pay, targeted direct compensation (base salary and incentive awards) should generally be close to the median of the market. Targeted pay should deviate from the median, however, based on a variety of factors, including company performance and individual qualifications and performance.
  •  Team-Based Pay
  •  Relative internal pay equity should be maintained, in keeping with the company’s commitment to a work environment that promotes respect and teamwork.
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