Progress Energy 2008 Annual Report Download - page 150

PROXY STATEMENT
14
Organization and Compensation Committee
The Organization and Compensation Committee (the “Compensation Committee”) is presently
composed of the following six nonmanagement directors: Ms. E. Marie McKee—Chair, Messrs.
David L. Burner, Harris E. DeLoach, Jr., Robert W. Jones, W. Steven Jones, and John H. Mullin, III.
All members of the Compensation Committee are independent as that term is defined under the general
independence standards contained in the NYSE listing standards. The Compensation Committee verifies that
personnel policies and procedures are in keeping with all governmental rules and regulations and are designed
to attract and retain competent, talented employees and develop the potential of these employees. The
Compensation Committee reviews all executive development plans, makes executive compensation decisions,
evaluates the performance of the Chief Executive Officer and oversees plans for management succession.
The Compensation Committee may hire outside consultants, and the Compensation Committee
has no limitations on its ability to select and retain consultants as it deems necessary or appropriate.
Annually, the Compensation Committee evaluates the performance of its compensation consultant to
assess its effectiveness. For 2008, the Compensation Committee retained Hewitt Associates as its executive
compensation and benefits consultant to assist the Compensation Committee in meeting its compensation
objectives for our Company.
The Compensation Committee relies on its compensation consultant to advise it on various matters
relating to our executive compensation and benefits program. These services include:
• AdvisingtheCompensationCommitteeongeneraltrendsinexecutivecompensationandbenefits;
• Performingbenchmarkingandcompetitiveassessments;
• Designingincentiveplans;
• Performingfinancialanalysisofanddeterminingshareholdervaluedrivers;and
• Recommendingappropriateperformancemetricsandfinancialtargets.
The Compensation Committee has adopted a policy for Pre-Approval of Compensation Consultant
Services (the “Policy”). Pursuant to the Policy, the compensation consultant may not provide any services
or products to the Company without the express prior approval of the Compensation Committee.
The Compensation Committee’s chair or the chairman of our Board of Directors may call
meetings, other than previously scheduled meetings, as needed. The Compensation Committee may form
subcommittees for any purpose that the Compensation Committee deems appropriate and may delegate
to such subcommittees such power and authority as the Compensation Committee deems appropriate.
Appropriate officers of the Company shall provide staff support to the Compensation Committee.
John R. McArthur, our Executive Vice President and Corporate Secretary, serves as management’s liaison
to the Compensation Committee. William D. Johnson, our Chief Executive Officer, is responsible for
conducting annual performance evaluations of the other executive officers and making recommendations to
the Compensation Committee regarding those executives’ compensation.
The Compensation Committee held five meetings in 2008.
Compensation Committee Interlocks and Insider Participation
None of the directors who served as members of the Compensation Committee during 2008
was our employee or former employee and none of them had any relationship requiring disclosure under
Item 404 of Regulation S-K. During 2008, none of our executive officers served on the compensation
committee (or equivalent), or the board of directors of another entity whose executive officer(s) served on
our Compensation Committee or Board of Directors.