INTEGRYS ENERGY GROUP, INC.
OF THE BOARD OF DIRECTORS
Statement of Purposes
The Compensation Committee (the quot;Committeequot;) of Integrys Energy Group, Inc.’s Board of Directors (the
“Board”) will discharge the responsibilities of the Board relating to compensation of the executive officers of
Integrys Energy Group, Inc. (the “Company”) and act in an advisory and consulting capacity to
management regarding the Company’s compensation policies, programs and plans. The Committee will
provide assistance to the Board in approving employee compensation and benefit programs and prepare
annually a Compensation Committee Report and review the Compensation Discussion and Analysis of
executive compensation for inclusion in the Company’s proxy statement. The Committee will act in an
advisory and consulting capacity to management regarding the Company's management development
plans and succession plans. The Committee will evaluate the performance of the Chief Executive Officer
and report to the Board its results.
The Committee will consist of at least three members of the Board, each of whom will meet the
independence requirements of the New York Stock Exchange, Inc. (the “NYSE”). Additionally, no director
may serve on the Committee unless he or she (i) is a “Non-Employee Director” as defined in Rule 16b-3
promulgated under the Securities Exchange Act of 1934, as amended, and (ii) satisfies the requirements of
an “outside director” for purposes of Section 162(m)(4)(C) of the Internal Revenue Code.
Appointment and Removal of Committee Members
The Board in its sole discretion will appoint, remove and replace the members of the Committee, in
accordance with the applicable provisions of the Company’s by-laws. Each member will serve until his or
her successor is duly elected and qualified or until such member’s earlier resignation or removal.
The Board will appoint the Chairperson of the Committee.
Reporting Procedures and Records
The Committee will report regularly to the Board (i) following meetings of the Committee, (ii) with respect to
such matters as are relevant to the Committee’s discharge of its responsibilities, (iii) to obtain necessary
ratification of actions taken by the Committee, and (iv) with respect to such recommendations as the
Committee may deem appropriate. The report to the Board may take the form of an oral report by the
Committee’s Chairperson or any other member of the Committee designated by the Committee to make
The Committee will maintain minutes or other records of meetings and activities of the Committee.
Meetings and Delegation
The Committee will meet at least annually and more often as may be deemed necessary or appropriate.
The Chairperson of the Committee, in consultation with the other Committee members, will determine the
frequency and length of the Committee meetings and will set meeting agendas consistent with this Charter.
Pursuant to the by-laws of the Company, a majority of the number of directors appointed to serve on the
Committee will constitute a quorum for the transaction of business at any meeting of the Committee. At the
discretion of the Committee, the Secretary of the Company will act as Secretary for the Committee.
The Committee may invite to its meetings any officer, employee or director of the Company and any other
person that it deems appropriate in order to carry out its responsibilities. However, an officer or director
shall not be present at any discussion, review or evaluation where his or her performance and/or
compensation is finally determined.
Annual Performance Evaluation
The Committee shall perform a review and evaluation, at least annually, of the performance of the
Committee, including reviewing the compliance of the Committee with this Charter. In addition, the
Committee shall review and reassess, at least annually, the adequacy of this Charter and recommend to
the Board any improvements to this Charter that the Committee considers necessary or valuable. The
Committee shall conduct such evaluations and reviews in such manner as it deems appropriate consistent
with the governance requirements of the Board.
Compensation Responsibilities and Duties
In furtherance of its purposes, the Committee shall have the following responsibilities and duties:
1. The Committee shall review the overall compensation philosophy of the Company, at least annually,
and shall take such action as the Committee deems necessary or appropriate.
2. The Committee shall review and recommend to the Board corporate goals and objectives relevant to
Chief Executive Officer and other executive officer compensation for all officers that are determined to
be executive officers under the rules of the Securities Exchange Commission and for any other officers
that the Committee determines from time to time (“Executive Officers”).
3. The Committee shall have the sole authority to hire and terminate any compensation consultants to be
used to assist in the evaluation of Chief Executive Officer and other Executive Officer compensation,
including sole authority to approve the compensation consultant’s fees and other retention terms.
4. The Committee shall evaluate, at least annually, the performance of the Chief Executive Officer of the
Company in light of corporate goals and objectives reviewed and approved by the Committee. Based
on such evaluation, the Committee will review and recommend to the independent directors of the
Board the base pay, incentive and bonus award plans (including all stock bonus plans and stock option
plans), and other benefits, direct and indirect, of the Chief Executive Officer.
5. The Committee shall evaluate, at least annually, and ensure that the Chief Executive Officer evaluates
and reviews with the Committee the performance of Executive Officers other than the Chief Executive
Officer, as appropriate and in light of corporate goals and objectives reviewed and approved by the
Committee. Based on such evaluations, the Committee will review and recommend to the Board, or if
delegated by the Board, shall have and shall exercise all the authority of the Board with respect to
approval of, the base pay, incentive and bonus award plans (including all stock bonus plans and stock
option plans), and other benefits, direct and indirect, of such Executive Officers.
6. In determining the long-term incentive component of compensation of the Chief Executive Officer and
the Executive Officers, the Committee will consider various evaluation criteria, including the Company’s
performance (or, if applicable, the subsidiary’s performance), the value of similar incentive awards to
chief executive officers and other executive officers at comparable companies, and the awards given to
the Company’s Chief Executive Officer and the Executive Officers in past years.
7. The Committee shall review and recommend to the Board any contracts or other transactions with the
Chief Executive Officer, including consulting arrangements, employment contracts and severance or
8. The Committee shall review and recommend to the Board incentive-compensation and benefit plans
for the Executive Officers and all equity-based plans. The Committee shall have and shall exercise all
the authority of the Board with respect to the administration of such plans.
9. The Committee shall prepare annually a Compensation Committee Report and review the
Compensation Discussion and Analysis of executive compensation for inclusion in the Company’s
proxy statement, in accordance with applicable rules and regulations of the Securities and Exchange
10. The Committee shall review and evaluate the succession plan relating to the Chief Executive Officer
and the Executive Officers and shall make recommendations to the Board with respect thereto.
11. The Committee shall recommend to the Board persons to be appointed as officers of the Company or, if
not an officer of the Company, an officer of a subsidiary who is determined to be an Executive Officer.