Regulation - LGIC
Hydro One Annual Compensation Disclosure
Regulation Number(s):
N/A
Instrument Type:
Regulation - LGIC
Bill or Act:
Hydro One Accountability Act, 2018
Summary of Proposal:
Subsection 7(1) of the Act requires Hydro One Limited to publish on its public website a record of the total annual compensation paid in the previous year by Hydro One Limited to or in respect of executives provided for in the regulations by no later than March 31 of each year.
The proposed regulation, in reference to subsection 7(1), would:
1. Prescribe the following executives for the purposes of the Act:
• Executive vice presidents, vice presidents, chief administrative officer, chief operating officer, chief financial officer, chief information officer, chief legal officer, chief human resources officer or chief corporate development officer, or a person who holds any other executive position or office, regardless of the title of the position or office.
• This would be consistent with the definition of "Executive" currently under the Hydro One Accountability Act, 2018.
• Currently, this definition would cover 31 Executives at Hydro One.
2. Prescribe the elements of compensation that Hydro One would be required to make public as part of their disclosure for all prescribed executives. Subject to subsection 7(1) of the Act and associated regulations, it is proposed that the compensation disclosures would be calculated in accordance with the standards set forth for information circulars by the Ontario Securities Commission. This would ensure consistency between the compensation disclosed in Hydro One's Management Information Circular, and the disclosure under the Hydro One Accountability Act, 2018.
• The elements of compensation that would be disclosed would include:
- Cash Compensation: Including base salary, which is fixed compensation reflecting capability, experience, and performance, as well as short-term incentive payments, which are cash incentives tied to achieving specific annual objectives.
- Long-term incentives Vested in the Reported Year: Total value of share-based awards and option-based awards vested in the reported year.
- Pension and Other Compensation: Pension value accrued in the reported year and any other compensation paid, if applicable.
- Long-term incentives granted in the year: Value of target stock-based incentives tied to the creation of shareholder value over a period of time greater than a year.
- The aggregate amount for each of the above mentioned categories would be proposed to be disclosed.
• The position title of each individual would be disclosed.
• See Appendix A for the Disclosure Format that would be used.
3. Prescribe that the compensation disclosure requirements under the Act apply to all executives of Hydro One Limited and all of its Canadian subsidiaries.
• The regulation would ensure all intended executives, regardless of Hydro One's corporate structure, are captured and included in the annual disclosure.
The proposed regulation, in reference to subsection 7(1), would:
1. Prescribe the following executives for the purposes of the Act:
• Executive vice presidents, vice presidents, chief administrative officer, chief operating officer, chief financial officer, chief information officer, chief legal officer, chief human resources officer or chief corporate development officer, or a person who holds any other executive position or office, regardless of the title of the position or office.
• This would be consistent with the definition of "Executive" currently under the Hydro One Accountability Act, 2018.
• Currently, this definition would cover 31 Executives at Hydro One.
2. Prescribe the elements of compensation that Hydro One would be required to make public as part of their disclosure for all prescribed executives. Subject to subsection 7(1) of the Act and associated regulations, it is proposed that the compensation disclosures would be calculated in accordance with the standards set forth for information circulars by the Ontario Securities Commission. This would ensure consistency between the compensation disclosed in Hydro One's Management Information Circular, and the disclosure under the Hydro One Accountability Act, 2018.
• The elements of compensation that would be disclosed would include:
- Cash Compensation: Including base salary, which is fixed compensation reflecting capability, experience, and performance, as well as short-term incentive payments, which are cash incentives tied to achieving specific annual objectives.
- Long-term incentives Vested in the Reported Year: Total value of share-based awards and option-based awards vested in the reported year.
- Pension and Other Compensation: Pension value accrued in the reported year and any other compensation paid, if applicable.
- Long-term incentives granted in the year: Value of target stock-based incentives tied to the creation of shareholder value over a period of time greater than a year.
- The aggregate amount for each of the above mentioned categories would be proposed to be disclosed.
• The position title of each individual would be disclosed.
• See Appendix A for the Disclosure Format that would be used.
3. Prescribe that the compensation disclosure requirements under the Act apply to all executives of Hydro One Limited and all of its Canadian subsidiaries.
• The regulation would ensure all intended executives, regardless of Hydro One's corporate structure, are captured and included in the annual disclosure.
Analysis of Regulatory Impact:
The regulation would apply to Hydro One and all of its Canadian subsidiaries. The Province expects minimal administrative costs associated with the implementation of this regulation.
Further Information:
Appendix A – Disclosure Format
Hydro One Accountability Act, 2018
Proposal Number:
19-ENDM002
Posting Date:
February 21, 2019
Comments Due Date:
March 23, 2019
Contact Address:
Investment and Governance Branch
Strategic, Network and Agency Policy Division
Ministry of Energy, Northern Development and Mines
77 Grenville Street, 7th Floor
Toronto, ON M7A 2C1
Strategic, Network and Agency Policy Division
Ministry of Energy, Northern Development and Mines
77 Grenville Street, 7th Floor
Toronto, ON M7A 2C1