Corporate Governance

We believe that effective governance is a major contributor to long-term performance and investor confidence.

Board of Directors

In keeping with contemporary practices of good corporate governance, Capital Power has a board of eight directors, seven of whom are independent for the purposes of National Instrument 58-101.

 

Board Roles and Responsibilities

The Board of Directors (the board) is responsible for the stewardship of Capital Power by providing independent, effective leadership to supervise the management of Capital Power’s business and affairs and to grow value responsibly, in a profitable and sustainable manner. The board is responsible for:

  • Management selection, retention, succession, and remuneration;

  • Overseeing the development of the company’s business strategy and monitoring its progress;

  • Approving significant company policies and procedures;

  • Overseeing timely and accurate reporting to shareholders and public filing of documents; and

  • Approving major company decisions, such as: budgets; acquisitions; major capital expenditures; and documents, including such things as audited financial statements, declarations of dividends, offering circulars, and initiation of bylaw amendments.  

Capital Power also has terms of reference for individual directors that outline the personal and professional characteristics required for all directors, and which is used as the basis for performance evaluation and recruitment.

  
  
Board Terms of Reference.pdfBoard Terms of Reference
Individual Director Terms of Reference.pdfIndividual Director Terms of Reference
 

Corporate Governance Practices

 

The board has approved a Corporate Governance Policy outlining the Corporation’s governance practices. The board has also approved a Diversity Policy recognizing the benefits of having a diverse Board of Directors.

  
  
Board Diversity Policy.pdfBoard Diversity Policy
Corporate Governance Policy.pdfCorporate Governance Policy

Our corporate governance practices are intended to meet or exceed the rules and guidelines of Canadian securities regulators, which include the following:

Board Composition and Independence  

The Board of Directors is required to have a minimum of three and a maximum of 12 directors. As of September 6, 2016, the board consists of eight directors, all of whom were elected by common shareholders at Capital Power's annual meeting. The board comprises six men and two women. Of the eight directors, seven are independent for the purposes of National Instrument 58-101

Mr. Lowry is Chair of the Board and is independent. The board has adopted terms of reference for the Chair that sets out the Chair’s responsibilities and principal duties. The Chair functions in a leadership capacity and has the statutory authority to preside over meetings of the Board. As part of performing this function, the Chair has the duty to support and assist the CEO and work with the CEO to develop and maintain productive relationships with all stakeholders and ensure the board represents and protects the interest of shareholders.

The board has determined that all of the directors, except Mr. Vaasjo, are independent within the meaning of applicable Canadian securities laws, on the basis that they do not have any direct or indirect relationship with the company that could, in the view of the board, be reasonably expected to interfere with the exercise of their independent judgment.

  
  
Chair Terms of Reference.pdfChair Terms of Reference
President and CEO Terms of Reference.pdfPresident and CEO Terms of Reference

Board Structure

The three standing committees of the board include the following:
 
  1. Audit committee
  2. Corporate Governance, Compensation and Nominating committee
  3. Health, Safety and Environment committee
 

All of the members of the committees are independent.

In accordance with its terms of reference, each committee is responsible for overseeing certain corporate governance matters and making appropriate recommendations to the board. Each committee is committed to meeting or exceeding governance standards set out by various regulatory authorities and governance policy-makers, including the Canadian Securities Administrators’ instruments relating to corporate governance.

  
  
Audit Committee Terms of Reference.pdfAudit Committee Terms of Reference
Corporate Governance Compensation Nominating Committee Terms of Reference.pdfCorporate Governance Compensation Nominating Committee Terms of Reference
Health Safety Environment Committee Terms of Reference.pdfHealth Safety Environment Committee Terms of Reference
 

Link between Compensation and Corporate Performance

To ensure alignment with the interests of shareholders, board directors and named executive officers are subject to share ownership guidelines, disclosed in the most recent Management Proxy Circular.

The company’s practices regarding compensation for directors are designed to attract and retain the most qualified individuals to serve on the board, to reflect the size and complexity of the industry, and to reinforce the emphasis the company places on aligning directors’ compensation with the interests of shareholders.

The company provides its directors with a compensation package consisting of an annual retainer, committee and meeting fees, and equity-based compensation in the form of deferred share units (DSUs).

Non-employee directors can elect to receive a portion of their annual retainer in the form of DSUs and are also subject to share ownership guidelines that require ownership of Common Shares and/or DSUs with an acquisition or market value equivalent to not less than three times the aggregate value of their annual cash and equity retainer.

Directors have five years from their respective dates of appointment to accumulate the required number of Common Shares and/or DSUs.

 
 

 Last Reviewed: September 2016