Ken Toole’s recent commentary on NorthWestern Energy executive salaries and in particular the compensation of CEO Bob Rowe has given me an enormous sinking-of-heart. Ken has been a Public Service Commission regulator and legislator, and knows how the system of investor-owned utilities works. More important, he knows Bob Rowe. I feel certain he knows, as I do, that there is not a more visionary, informed, and gracious leader in the state of Montana. Ken’s editorial is a grim reminder to what depths our civic conversation has sunk.
I retired this past month as a member of NorthWestern’s Board of Directors. This was an astonishing chapter for an old Montana Democratic representative. Since my election by the shareholders, I have witnessed the revival of NorthWestern Energy. It has been astonishing, including (to my greatest pride) the acquisition of our hydro generation system, along with lots of other renewable generation and sustainable pilot projects, to the point that the electricity delivered to your home and businesses is nearly 60 percent renewable. Also important to me is that in this same period we have seen NorthWestern receive very honorable national recognition – for corporate transparency, trustworthiness, and customer satisfaction, just to mention a few.
The credit for these achievements belongs with NorthWestern’s employees and executives, led by Bob Rowe. Bob came to Montana many years ago as a lawyer for legal services with VISTA, representing low-income people on utility matters.
For just a few specifics, if you want to wade into the weeds: (1) NorthWestern’s proxy statement has voluntarily published a CEO-to-employee salary ratio for a number of years, even though it is not required by the Securities and Exchange Commission (SEC) because of Bob and the board’s support of transparency. The CEO-to-employee pay ratio at NorthWestern is 22-to-1, a far cry from the 204-to-1 average ratio Ken cites; (2) much of Bob’s compensation is based on performance and not base salary – that is to say, it is contingent on the performance of NorthWestern and not a guarantee; (3) Bob’s stock-based compensation is paid by shareholders, not customers; (4) shareholders vote annually – more often than what is required by the SEC -- on all executive salaries, and those votes have been highly supportive; (5) to lure an outstanding CEO to NorthWestern, the board has to offer a competitive salary, and the board worries about retention because Bob’s base pay is at the low end compared to peer utilities; (6) an outstanding CEO has to understand new technology, new policy, new trends, new customer needs, new risks, new workplace needs, and new cyber challenges, just to mention a few news. Bob is a perfect fit.
NorthWestern Energy is an extraordinary company with billions of dollars of infrastructure and hundreds of good-hearted employees dedicated to serve Montana, charging rates well below the national average. Our modern infrastructure, critical to Montana’s comfort and progress, doesn’t even have deferred maintenance, unlike most of our government-run infrastructure which is perilously close to serious problems.
I look to the day when we start working together in good faith for the well-being of our Montana communities and our future. This mean-spirited quarreling is getting us nowhere. The challenges of our future are extraordinarily serious. I am ever more certain that our survival is dependent on better trust, partnership and cooperation. Honestly, Ken – you, Bob and I have known each other for so many years. Please, let’s start moving forward together.
Dorothy Bradley lives near Clyde Park and served as a NorthWestern Energy board member before stepping down in late April.