2018 Guide to Effective Proxies

6 TH EDITION | GUIDE TO EFFECTIVE PROXIES 232 W. R. BERKLEY CORPORATEGOVERNANCEANDBOARDMATTERS BoardRoleinRiskOversight. Managingriskisacriticalelementofanypropertycasualtyinsurance business.TheBoardofDirectorsbelievesthatriskoversightisakeyresponsibilityoftheentireBoardof Directors.RiskmanagementisoneofthecoreresponsibilitiesoftheExecutiveChairmanandthe PresidentandChiefExecutiveOfficerandisacriticalresponsibilityofeveryotherseniorofficerofthe Companyanditsoperatingunits. Thestrategicmanagementofriskinaninsurancebusinessisamulti-levelproposition.TheBoardof Directorshasanactiverole,bothasawholeandalsoatthecommitteelevel,inriskoversight.The BoardofDirectorsanditscommitteesreceiveperiodicupdatesfrommembersofseniormanagement, includingtheSeniorVicePresident—EnterpriseRiskManagement,onareasofmaterialrisktothe Company,suchasoperational(includingrisksrelatedtoclimatechange,cybersecurityandtechnology), financial,strategic,competitive,investment,reputational,legalandregulatoryrisks.Amongother things,theBoardofDirectorsasawholeoverseesmanagement’sassessmentofbusinessrisksrelating totheCompany’sinsuranceoperationsandinvestmentportfolio. Atthecommitteelevel: ➣ OurAuditCommitteeregularlyreviewsourfinancialstatements,financialandotherinternalcontrols, andremediationofmaterialweaknessesandsignificantdeficienciesininternalcontrols,ifany. ➣ OurCompensationCommitteeregularlyreviewsourexecutivecompensationpoliciesandpractices andtherisksassociatedwitheach.See“DiscussionofRiskandCompensationPlans”onpage76. ➣ OurNominatingandCorporateGovernanceCommitteeconsidersissuesassociatedwiththe independenceofourBoardofDirectors,corporategovernanceandpotentialconflictsofinterest. Whileeachcommitteeisresponsibleforevaluatingcertainrisksandriskoversight,theentireBoardof DirectorsisregularlyinformedofrisksrelevanttotheCompany’sbusiness,asdescribedabove. RiskmanagementisacoretenetoftheCompany,withtheconceptofachievingappropriaterisk- adjustedreturnsinourbusinessadrivingprinciplesincetheCompanywasfounded.Asakeyelementof theirduties,ourseniorexecutiveofficersareresponsibleforrisksandpotentialrisksastheyarisefrom daytodayintheirvariousoperationalareas.TheCompany’sSeniorVicePresident—EnterpriseRisk Management,whoisresponsibleforenterpriseriskmanagement,reportsdirectlytothePresidentand ChiefExecutiveOfficerandalsoreportstotheBoardofDirectorsregardingtheCompany’srisk management.TheCompany’sEnterpriseRiskManagementCommittee,whichiscomposedofthe PresidentandChiefExecutiveOfficer,SeniorVicePresident—EnterpriseRiskManagement,Executive VicePresident—InvestmentsandExecutiveVicePresidentandSecretary,meetsquarterly,andmore frequentlyasnecessary,toreviewandmonitorlevelsofriskofvarioustypes.Inaddition,ourinternal auditfunctionreportstoourAuditCommitteeonaquarterlybasis,andmorefrequentlytotheextent necessary. OurindependentoutsideauditorsregularlyidentifyanddiscusswithourAuditCommitteerisksand relatedmitigationmeasuresthatmayariseduringtheirregularreviewsoftheCompany’sfinancial statements,auditworkandaccountingmattersassociatedwithexecutivecompensation. 2018ProxyStatement 45 WELLS FARGO Proxy Summary ENHANCEMENTS TO BOARD RISK OVERSIGHT ApriorityoftheBoardhasbeenandcontinuestobeenhancingitsoversightofrisk,includingthroughchanges totheBoard’scorporategovernanceframeworkandcommitteeoversightresponsibilities. • TheBoardhasreviewedcommitteeresponsibilities andamendedcommitteecharterstosharpenfocusand reduceduplicationintheBoard’sriskoversight,includingrelatingtoconductrisk,compliancerisk, operationalrisk,informationsecurity/cyberrisk,andtechnologyrisk. • TheChairandBoardcommitteechairsareworkingcloselywithmanagementtosetandapprovemeeting agendasandimproveinformationflowandmanagement’sreportingandanalysistotheBoard. Board Oversight • Strategicplans,risktolerance,riskmanagementframework,andfinancialperformance • CEOandotherseniormanagementperformance,accountability,andsuccessionplanning • Boardcomposition,governancestructure,andpractices • BoardandcommitteemeetingagendasandschedulesandtheinformationflowtotheBoard • StatureandindependenceoftheCompany’sindependentriskmanagement(includingcompliance),legal,andinternal auditfunctions • Companycultureofethics,compliance,andriskmanagement Committee KeyChangestoOversightResponsibilities Risk • ConsolidatedoversightofCorporateRiskandenterprise-wideriskmanagementactivitiesunder theRiskCommittee • Established2subcommitteesoftheRiskCommitteetoprovidemorefocusedoversightof: 1. Compliancerisk,and 2. Technology,informationsecurity,andcyberriskaswellasdatagovernanceand management • OverseestheactivitiesoftheCompany’sConductManagementOffice(includescomplaints, internalinvestigations,ethics,allegations,andsalespracticesoversight) Governance and Nominating • ContinuestooverseeBoard-levelgovernancematters,includingBoardandcommittee composition • Overseesourbusinessstandardsreviewandreportasdiscussedinthisproxystatement Human Resources • Enhancedoversightresponsibilitiesincludehumancapitalmanagement,culture,andethics • Continuestooverseeourincentivecompensationriskmanagementprogramwhichwasexpanded toincludeabroaderpopulationofteammembersandincentiveplans Auditand Examination • Focusedoversightonfinancialperformanceandreporting,theCompany’sindependentregistered publicaccountingfirm,ourinternalauditfunction,andregulatoryactivities Corporate Responsibility • Focusedoversightonsignificantsocialandpublicresponsibilitymattersofinteresttothe CompanyanditsstakeholdersandtheCompany’srelationshipswithitsstakeholders Finance • ConsolidatedoversightofresolutionandrecoveryplanningundertheFinanceCommittee Credit • Continuestooverseecreditriskandrelatedmatters WellsFargo&Company 2018ProxyStatement v XCEL ENERGY CorporateGovernance Risk Oversight AkeyaccountabilityoftheBoardistheoversightofmaterialrisk,andourBoardemploysastrongprocessfordoingso.Asoutlined below,managementandeachBoardcommitteehasresponsibilityforoverseeingtheidentificationandmitigationofkeyrisksand reportingtheirassessmentsandactivitiestothefullBoard. Managementidentifiesandanalyzesriskstodeterminematerialityandotherattributessuchastiming,probabilityandcontrollability. Managementbroadlyconsidersourbusiness,theutilityindustry,thedomesticandglobaleconomies,andtheenvironment,and employsarobustcomplianceprogramwhenidentifying,assessing,managingandmitigatingrisk. KeyComponentsofManagement’sOversightandMitigationofRisk Identifyandanalyze materialityofrisks through: • Formalkeyriskassessment • Financialdisclosureprocess • Hazardriskmanagementprocess • Internalauditingandcompliancewithfinancialandoperationalcontrols • Businessplanningprocess • Developmentofstrategicgoalsandkeyperformanceindicators Provideregular presentationstothe Boardregardingrisk assessmentand mitigation,including: • Comprehensiveriskoverview • Legalandregulatoryrisks • Operatingrisks • Financialrisks • Compliancerisks Manageandmitigate risksthroughuseof management structuresandgroups, including: • Managementcouncils • Managementriskcommittees • Advicefrominternalcorporateareas Employarobust complianceprogram forthemitigationof risk,including: • AdherencetoourCodeofConductandothercompliancepolicies • Operationofformalriskmanagementstructuresandgroups • Focusedmanagementtomitigatetherisksinherentintheimplementationofourstrategy TheBoardapproachesriskoversightandmitigationasanintegralandcontinuouspartofitsgovernanceoftheCompany.First,the Boardasawholeregularlyreviewsmanagement’skeyriskassessmentandanalyzesareasofexistingandfuturerisksand opportunities.Next,theBoardassignsoversightofcertaincriticalriskstoeachofitsfourstandingcommitteestoensuretheserisksare bothwellunderstoodandprovidedfocusedoversightbythecommitteewiththemostapplicableexpertise.Newrisksidentifiedduring theriskassessmentprocessareconsideredandassignedasappropriate,typicallyduringtheannualBoardandcommitteeevaluation process,withcommitteechartersandannualworkplansupdatedaccordingly.Committeesregularlyreportontheiroversightactivities, andcertainrisktopicsmaybebroughttothefullBoardforconsiderationwheredeemedappropriatetoensurebroadBoard understandingofthenatureoftherisk.Finally,theBoardconductsanannualstrategysessionwheretheCompany’sfutureplansand initiativesarereviewedandconfirmedinlightofthecurrentandprojectedlandscape. TheAuditCommitteeisresponsibleforreviewingtheadequacyofriskoversightandaffirmingthatappropriateoversightoccurs. Currentriskassignmentsareasfollows: ResponsibleParty AreaofRiskOversight BoardofDirectors Overallidentification,managementandmitigationofrisk,withafocusonstrategicrisks AuditCommittee Financialreportingandinternalcontrolrisks Adequacyofriskoversight Complianceriskassessmentandmitigation FinanceCommittee Financialrisks,includingliquidity,credit,capitalmarketandinsurancerisks GCNCommittee Executivecompensation-relatedrisks Politicalactivityrisks Boardandmanagementsuccessionrisks Operations,Nuclear, EnvironmentalandSafety (“ONES”)Committee Operatingrisks,includingnuclear,environmental,physicalandcybersecurityrisks 10 | 2018 XcelEnergyProxyStatement