8-KLeadership ChangesOther EventsExhibits & Filings

CONSOLIDATED EDISON INC 8-K Report, Executive Changes (Nov 20, 2020)

Filed November 20, 2020For Securities:ED

Summary

Consolidated Edison Inc. (ED) filed an 8-K on November 20, 2020, announcing several key developments. Most notably, the company appointed two new independent directors, Ms. Karol Mason and Dr. Dwight McBride, to its Boards, effective January 1, 2021. These appointments bring new expertise in higher education and public service to the board. Additionally, the filing formally announced the succession plan for its leadership. Timothy Cawley was appointed President and Chief Executive Officer of Con Edison, effective December 29, 2020, succeeding John McAvoy, who will remain as Chairman. Mr. Cawley's employment agreement outlines his base salary, incentive opportunities, and benefits. The company also disclosed significant regulatory proceedings initiated by the New York State Public Service Commission (NYSPSC) concerning the company's response to Tropical Storm Isaias and previous power outages in Manhattan and Brooklyn, with potential for substantial penalties and prudence reviews.

Key Highlights

  • 1Appointment of two new independent directors, Ms. Karol Mason and Dr. Dwight McBride, to the Boards, effective January 1, 2021.
  • 2Timothy Cawley appointed President and CEO of Con Edison and its subsidiary Con Edison of New York, effective December 29, 2020.
  • 3John McAvoy will continue to serve as Chairman of the Boards.
  • 4Timothy Cawley's employment agreement includes an initial base salary of $1,250,000, with defined annual and long-term incentive opportunities.
  • 5NYSPSC has initiated investigations into Con Edison's response to Tropical Storm Isaias and July 2019 power outages.
  • 6Potential civil penalties of up to $102.3 million for Con Edison of New York (CECONY) related to Tropical Storm Isaias, and up to $24.8 million for past non-compliance related to July 2019 outages.
  • 7NYSPSC is considering prudence reviews for expenditures related to both storm events and potential revocation/modification of utility certificates.

Frequently Asked Questions

Effective January 1, 2021, Ms. Karol Mason and Dr. Dwight McBride have been elected as members of the Boards. Ms. Mason will serve on the Corporate Governance and Nominating Committees and the Safety, Environment, Operations and Sustainability Committees. Dr. McBride will serve on the Management, Development and Compensation Committees and the Safety, Environment, Operations and Sustainability Committees.

Timothy Cawley will succeed John McAvoy as President and Chief Executive Officer of Con Edison and its subsidiary Con Edison of New York, effective December 29, 2020. Mr. McAvoy will continue in his role as Chairman of the Boards. Mr. Cawley will also join the Boards effective December 29, 2020.

Timothy Cawley's employment offer includes an initial base salary of $1,250,000. He will continue to participate in the company's annual incentive plan with a target bonus of 125% of base salary and a maximum of 200%. He will also continue in the long-term incentive plan and other benefit programs available to senior executives.

The NYSPSC has issued orders to show cause regarding Con Edison's response to Tropical Storm Isaias and the July 2019 power outages. This includes potential civil penalties of significant amounts for alleged violations and reviews into the prudence of expenditures related to these events. The NYSPSC also reserves the right to commence proceedings to revoke or modify the company's service certificates if repeated violations are confirmed.