Heightened demand for transparency and expectations of leadership to adopt a holistic, long-term approach to managing environment, social and governance (ESG) performance are the norms today. Companies are judged on performance and how well they link tangibles (such as financial capital and physical assets) with intangibles (such as reputation, brand, customer loyalty, risk management, trust and credibility) and show bottom line benefits.
There is no one-size-fits-all approach to sustainability governance, but AEP believes it is fundamental to building and strengthening sustained business value. Good governance ensures transparency, fairness and accountability and gives us a structured way to manage the challenges of a changing society.
Through AEP’s Enterprise Sustainability Council and with oversight from executive management and the Committee on Directors and Corporate Governance of the Board of Directors, we have clear guidance on our ESG responsibilities for sustainable business development. The Council is made up of some of AEP’s top leaders and decision-makers, representing functional units from across the company.
Nick Akins, chairman, president and CEO; David Feinberg, executive vice president, general counsel and corporate secretary; Lana Hillebrand, executive vice president and chief administrative officer; and Charles Patton, executive vice president and chief external officer, serve as executive sponsors.
The Council’s goals and objectives are to:
- Ensure activities and decisions, including performance reporting, align with our strategic plan and initiatives.
- Serve as champions of AEP’s sustainability efforts, seeking opportunities to link sustainability with culture, values, business performance and priority issues.
- Share work, best practices and ideas to identify potential risks/opportunities and emerging issues/trends and collaborate in developing solutions and sustainability goals/objectives.
- Manage disclosure to achieve the right balance compatible with AEP’s commitment to transparency, materiality and alignment with establishing reporting guidelines.
- Be accountable for the accuracy of the information disclosed.
The Council provides a forum for key decision-makers to come together, and reflects the maturity of sustainability and the reporting process at AEP. It is embedded in AEP’s business strategy, supporting our culture and our values.
In 2017, the Council will oversee the development of new sustainability goals for AEP. Our intent is to develop the new goals in 2017 and launch them in 2018. We have seven teams of employees engaged in this effort. Read our updated strategy for sustainable development.
In addition to the Council, the Committee on Directors and Corporate Governance of the Board of Directors reviews the Corporate Accountability Report annually. The Committee provides feedback and develops the Board statement supporting AEP’s commitment to sustainable business development and performance accountability; the statement is published in this report each year. While these issues are discussed throughout the year, we formally report to the Committee on our sustainability-related activities twice per year.
The governance structure we have in place supports AEP’s commitment to transparency and addressing stakeholder concerns by telling our balanced, accurate and complete story.
Functional Areas Represented on AEP’s Enterprise Sustainability Council
|Chief Customer Officer||Enterprise Security|
|Information Technology||Regulatory Services|
|Corporate Communications||AEP Energy|
|Supply Chain & Procurement||Human Resources|
|Ethics & Compliance||Environmental Services|
|Economic & Business Development||Customer & Distribution Services|
|Corporate Planning & Budgeting||Resource Planning |
|Technology Business Development||Transmission|
|Safety & Health||Public Policy|
|NERC Compliance ||Investor Relations|
|Continuous Improvement||Audit Services|
Learn more about AEP's Corporate Governance