ROLE OF THE BOARD OF DIRECTORS
The Board of Directors (“the Board”) is elected by the shareholders and is charged with the responsibilty of overseeing SCANA’s business which is conducted by the officers, managers and employees, under the direction of the Chief Executive Officer (“CEO”). The Board selects the CEO and acts as advisor and counselor to the CEO in monitoring the performance of the management team to enhance the long-term value of SCANA Corporation for its shareholders.
RESPONSIBILITIES OF THE BOARD OF DIRECTORS
The Board performs the following functions in addition to its general oversight role described above:
- reviews, oversees and approves fundamental financial and business strategies and major corporate actions;
- reviews and assesses identified major risks facing SCANA and the alternatives for their mitigation;
- approves and maintains a succession plan for the CEO, senior executives, and other senior leaders;
- reviews the CEO’s performance toward accomplishing the objectives of the strategic and business plans; and
- reviews with the CEO his annual assessment of senior management and other senior leaders.
FUNCTIONING OF THE BOARD
The Board has a minimum of four scheduled meetings each year at which it reviews and discusses materials provided to Directors prior to the meetings, including materials regarding the performance of SCANA in implementing its long-range strategic plan, goals and objectives and any immediate issues before SCANA. In addition to the regularly scheduled board meetings, the Board generally meets in one or more strategy sessions during each calendar year. Directors are expected to attend all scheduled board and committee meetings and to review in advance of the meeting all provided materials. Directors are also expected to attend all annual meetings of shareholders.
- It is the policy of SCANA that the positions of Chairman of the Board and Chief Executive Officer be held by the same person. SCANA has operated in this manner very successfully over many years.
- The Chairman of the Board and Chief Executive Officer ("Chairman and CEO") sets the agenda for Board meetings with the understanding that certain items pertinent to the advisory and monitoring functions of the Board should be brought to it periodically for review and/or decision. Agenda items that fall within the scope of responsibilities of a Board committee are discussed by the Chair of that committee. Any member of the Board may request that an item be included on the agenda.
- Board materials related to agenda items are provided to Board members sufficiently in advance of Board meetings to allow the Directors to prepare for discussion of these items at the meeting.
- At the invitation of the Board, members of senior management recommended by the Chairman and CEO attend Board meetings or portions thereof for the purpose of participating in discussions. Generally, presentations of matters to be considered by the Board are made by the manager responsible for that area of SCANA’s operations. In addition, the Board has free access to all other members of management and employees of SCANA, and, as necessary and appropriate, the Board may consult with independent legal, financial and accounting advisors to assist with respect to its duties to SCANA and its shareholders.
- Meetings of independent Directors without management present are held regularly (at least four times a year) and additionally to review the report of the independent registered public accounting firm, the criteria upon which the performance of the Chairman and CEO and other senior managers are based, the performance of the Chairman and CEO against such criteria, the compensation of the Chairman and CEO and other senior managers, and other relevant matters.
- The Board, with guidance from the Nominating and Governance Committee, conducts an annual performance self-evaluation.
FUNCTIONING OF COMMITTEES
- The Audit and Compensation Committees consist only of independent Directors. The Nominating and Governance Committee consists only of independent Directors who are not eligible for election at the next annual meeting and the Lead Director.
- The frequency, length and agenda of meetings of each of the committees are determined by the Chair of the committee. Sufficient time to consider the agenda items is provided. Materials related to agenda items are provided to the committee members sufficiently in advance of the meeting to allow the members to prepare for discussion of these items at the meeting.
- The responsibilities of each of the committees are determined by the Board from time to time with guidance from the Nominating and Governance Committee and are set forth in the committees' charters.
- Each committee is responsible for conducting an annual performance self-evaluation.
DIRECTORS AND INDEPENDENCE OF DIRECTORS
- SCANA’s Bylaws provide for a minimum of nine and a maximum of twenty directors as may be determined from time to time by the Board of Directors. The Board believes that the preferable size of the Board is in the range of nine to fifteen members.
- It is SCANA's policy that a majority of the Directors be independent as determined under the New York Stock Exchange ("NYSE") rules and under any Director Qualifications Standards recommended by the Board. In making determinations of independence, the Board considers all relevant facts and circumstances.
- In addition to the foregoing, Audit Committee members may not accept, directly or indirectly, any consulting, advisory or other compensatory fee from SCANA, or have any other direct or indirect financial relationship with SCANA other than ownership of SCANA securities and compensation for service as Directors. Audit Committee members may receive Directors’ fees in the same form as other Directors and may receive the same regular benefits that other Directors receive.
DIRECTOR QUALIFICATION STANDARDS
- Directors must possess and have demonstrated the highest personal and professional ethics, integrity and values consistent with those of SCANA.
- Directors must be unencumbered and unbiased and able to make business judgments in the long term interests of SCANA and its shareholders as a whole.
- Directors are required to deal at arm’s length with SCANA and its subsidiaries and to disclose all circumstances material to the Director that might be perceived as a conflict of interest.
- Directors must be committed to the enhancement of the long-term interests of SCANA's shareholders.
- Directors must be willing to challenge the strategic direction of management, exercising mature judgment and business acumen.
- Directors must be willing to devote sufficient time and care to the exercise of their duties and responsibilities.
- Directors must possess significant experience in management positions of successful business organizations.
- Directors who serve as chief executive officers or equivalent positions should not serve on more than two boards of public companies in addition to the SCANA Board. Other Directors should not serve on more than four boards of public companies in addition to the SCANA Board.
- The term of office of any Director who is not a salaried employee of the corporation shall expire at the Annual Meeting of Shareholders next preceding the date on which such director attains age 70. There are no other limitations on the length of Board service. The Board does not believe that rigid term limits for Directors would serve SCANA's best interests.
- Pursuant to SCANA’s Bylaws, all independent Directors are required to own a minimum number of shares of the Corporation’s common stock equal to the aggregate number of shares granted in the five most recent annual retainers for Directors. Persons serving as Directors as of February 19, 2009 shall be required to meet the minimum share ownership requirement by the last day of February 2014, and persons who are subsequently elected as directors shall be required to meet such requirement within six years following the date of their election. The Nominating and Governance Committee has the discretion to grant a temporary waiver of such minimum share ownership requirements upon demonstration by a director that, due to a financial hardship or other good reason, he or she cannot meet the minimum share ownership requirements. The Nominating and Governance Committee will evaluate on an annual basis each director’s share ownership to determine compliance with the minimum ownership requirements.
- One hundred percent of the annual retainer paid to independent Directors is paid in SCANA stock. The Board reviews Director compensation annually with guidance from the Nominating and Governance Committee. In making recommendations to the Board, the Committee shall consider the following: compensation should fairly pay Directors for work required in a company of SCANA’s size and scope; compensation should align Directors' interests with the long-term interests of shareholders; and the structure of the compensation should be simple, transparent and easy for shareholders to understand. Directors may also participate in the SCANA Corporation Director Compensation and Deferral Plan. Under this Plan, a Director may elect to defer up to 100% of retainer and meeting fees with distribution from the Plan to be ultimately payable in either shares of SCANA common stock or cash.
MAJORITY VOTING FOR DIRECTORS
In an uncontested election of directors, any nominee who receives a greater number of votes “withheld” from his or her election than votes “for” his or her election will, within five days following the certification of the shareholder vote, tender his or her written resignation to the Chairman of the Board for consideration by the Nominating and Governance Committee. As used herein, an “uncontested election of directors” is an election in which the number of nominees is not greater than the number of Board seats open for election. Nominees for election to our Board agree that their nomination is contingent upon adherence to this majority voting policy.
The Nominating and Governance Committee will consider such tendered resignation and, promptly following the date of the shareholders’ meeting at which the election occurred, will make a recommendation to the Board concerning the acceptance or rejection of such resignation. In determining its recommendation to the Board, the Nominating and Governance Committee will consider all factors deemed relevant by the members of the Nominating and Governance Committee including, without limitation, the stated reason or reasons why shareholders who cast “withhold” votes for the director did so, the qualifications of the director (including, for example, the impact the director’s resignation would have on the Company’s compliance with the requirements of the Securities and Exchange Commission, the New York Stock Exchange and these Corporate Governance Principles), and whether the director’s resignation from the Board would be in the best interests of the Company and its shareholders.
The Nominating and Governance Committee also will consider a range of possible alternatives concerning the director’s tendered resignation as members of the Committee deem appropriate including, without limitation, acceptance of the resignation, rejection of the resignation, or rejection of the resignation coupled with a commitment to seek to address and cure the underlying reasons reasonably believed by the Nominating and Governance Committee to have substantially resulted in the “withheld” votes.
The Board will take formal action on the Nominating and Governance Committee’s recommendation no later than 90 days following the date of the shareholders’ meeting at which the election occurred. Following the Board’s decision on the Nominating and Governance Committee’s recommendation, the Company will promptly disclose, in a Form 8-K filed with the Securities and Exchange Commission, the Board’s decision, together with a full explanation of the process by which the decision was made and, if applicable, the Board’s reason or reasons for rejecting the tendered resignation.
No director who, in accordance with this policy, is required to tender his or her resignation, shall participate in the Nominating and Governance Committee’s deliberations or recommendation, or in the Board’s deliberations or determination, with respect to accepting or rejecting his or her resignation as a director.
DIRECTOR ORIENTATION AND CONTINUING EDUCATION
The Nominating and Governance Committee is responsible for monitoring the orientation and education needs of the Directors as well as for making recommendations about orientation and education to the Board, individual directors and management where appropriate. Directors are expected to annually attend a director training program that is approved or endorsed by a nationally recognized firm. Such annual training shall be in a subject matter related to corporate governance or another subject specifically related to service on our Board. The Corporate Secretary shall be responsible for coordinating an orientation for new directors, and for periodically providing materials or briefing sessions for all directors on subjects that would assist them in discharging their duties. Each new director shall, within six months of election to the Board, spend a day at corporate headquarters for personal briefing by senior management on SCANA’s strategic plan, its financial statements, and its key policies and practices.
SCANA POLICIES ON BUSINESS ETHICS AND CONDUCT
- All SCANA employees, including the Chairman and CEO, the Chief Financial Officer, the Principal Accounting Officer and Directors, are required to abide by SCANA’s longstanding Code of Conduct to ensure that SCANA’s business is conducted in a consistently legal and ethical manner. These standards form the foundation of a comprehensive process that includes compliance with corporate policies and procedures, an open relationship among colleagues that contributes to good business conduct, and an abiding belief in the integrity of SCANA’s employees. SCANA’s policies and procedures cover all areas of professional conduct, including employment policies, conflicts of interest, intellectual property and the protection of confidential information, and require adherence to laws and regulations applicable to the conduct of SCANA’s businesses.
- Employees are required to report any conduct that they believe in good faith to be an actual or apparent violation of SCANA’s Code of Conduct.
These governance principles are reviewed periodically by the Board.
The Board shall annually elect the Company’s Lead Director. The Lead Director presides at all Board meetings at which the Chairman is not present, including executive sessions of the independent directors held at each regularly scheduled Board meeting, and is also authorized to call meetings of the Independent Directors when necessary or appropriate. The Lead Director will maintain an active, ongoing, positive and collaborative relationship with the Chairman and the CEO and keep an open line of communication providing for the dissemination of information to the Board. The Lead Director also collaborates with the Chairman regarding schedules and agendas for the board meetings and provides feedback from the Board to the Chairman following each executive session of the Independent Directors.
COMMUNICATIONS WITH DIRECTORS
You may communicate with the Chairs of the Audit, Compensation and Nominating and Governance committees by sending an e-mail to firstname.lastname@example.org, email@example.com, or firstname.lastname@example.org or with the independent Directors as a group by sending an e-mail to email@example.com.
SCANA will not make any personal loans or extensions of credit to Directors or executive officers. Amounts owed for the provision of utility services by the Company or its subsidiaries and billed to the Director or officer and paid in the ordinary course of business shall not be deemed to be a loan.
BOARD INTERACTION WITH INSTITUTIONAL INVESTORS, THE MEDIA AND CUSTOMERS
The Board believes that communications and relationships on behalf of SCANA with institutional investors, the media and customers should be conducted primarily by members of management. However, Directors may participate occasionally in such interaction at the request and with the knowledge of the CEO.