Progress Energy 2008 Annual Report Download - page 155

Progress Energy Proxy Statement
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• alignmanagementinterestswithinvestorexpectationsbyrewardingexecutivesfor
delivering long-term total shareholder return;
• attractandretainexecutivesbymaintainingcompensationthatiscompetitivewith
our peer group;
• fostereffectiveteamworkandcollaborationbetweenexecutivesworkingindifferent
areas to support our core values, strategy and interests;
• balancetheperceivedvalueofcompensationelementstoourexecutiveswithour
actual cost;
• complyinallmaterialrespectswithapplicablelawsandregulations;and
• canbereadilyunderstoodbyus,theCommittee,ourexecutivesandour
shareholders, and provide ease of administration.
PROGRAM ADMINISTRATION
Our executive compensation program is administered by the Committee, which is composed of six
independent directors (as defined under the NYSE corporate governance rules). Members of the Committee
currently do not receive compensation under any compensation program in which our executive officers
participate. For a discussion of director compensation, see the “Director Compensation” section on page 68
of this Proxy Statement.
The Committee’s charter authorizes the Committee to hire outside consultants, and the Committee
has no limitations on its ability to select and retain consultants as it deems necessary or appropriate. The
Committee evaluates the performance of its compensation consultant annually to assess the consultant’s
effectiveness in assisting the Committee with implementing the Company’s compensation program and
principles. In November 2007, the Committee retained Hewitt Associates (“Hewitt”) as its independent
executive compensation and benefits consultant to assist the Committee in meeting its compensation
objectives for our Company. Under the terms of its engagement, Hewitt reports directly to the Committee.
Throughout the remainder of this CD&A, the term “compensation consultant” refers to Hewitt unless
otherwise noted.
The 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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.
Hewitt has not in 2009, and did not in 2008, provide any services or products to the Company other than
those that are related to the Company’s executive compensation and benefits program.