Ex­elon pledges to change cul­ture, help fed­eral probe

Chicago Sun-Times - - TOP NEWS - BY DAVID ROEDER, BUSI­NESS & LA­BOR REPORTER droeder@sun­times.com | @Roed­erDavid Con­tribut­ing: Jon Sei­del

De­spite an ex­tra­or­di­nary ad­mis­sion of cor­rupt prac­tices by its ComEd sub­sidiary, top ex­ec­u­tives of Chicago-based Ex­elon said Fri­day they have rooted out those re­spon­si­ble and are busy re­form­ing the com­pany’s cul­ture.

In agree­ing to pay $200 mil­lion to set­tle a fed­eral probe into its lob­by­ing prac­tices, ComEd con­fessed that, from 2011 through 2019, it pro­vided $1.3 mil­lion in pay­ments to as­so­ciates of Illi­nois House Speaker Michael Madi­gan. It said the pay­ments were to curry fa­vor with Madi­gan over mat­ters im­por­tant to the util­ity.

Dur­ing an in­ter­view, Ex­elon CEO Christo­pher Crane said the time pe­riod in ques­tion in­volved much im­por­tant leg­is­la­tion. But he said Ex­elon, upon dis­cov­er­ing pay­ments to Madi­gan al­lies directed by for­mer ex­ec­u­tives, worked quickly on re­forms.

Crane de­clined to dis­cuss if the com­pany is pro­vid­ing di­rect ev­i­dence against Madi­gan, who is not ac­cused of wrong­do­ing. But the CEO noted the set­tle­ment re­quires ComEd and Ex­elon to fully co­op­er­ate with pros­e­cu­tors.

ComEd agreed not to ask cus­tomers to cover the $200 mil­lion. It also agreed to pay the money in two stages over 90 days and not seek re­im­burse­ment from any or­ga­ni­za­tion other than Ex­elon.

While it pro­vides power to 70% of Illi­nois cus­tomers, ComEd is just one of six pub­licly reg­u­lated util­i­ties un­der the Ex­elon um­brella. Last year, Ex­elon re­ported $3 bil­lion in net in­come on more than $34.4 bil­lion in rev­enue. In its re­port for the first quar­ter of this year, the com­pany said it had $1.45 bil­lion in cash.

Its stock closed Fri­day at $39.40 a share, up 3.5% de­spite news of the fed­eral charge.

From 2011 to 2019, “mul­ti­ple bills were passed that re­ally have been good pol­icy for con­sumers,” Crane said. “It has al­lowed ComEd to in­vest sig­nif­i­cantly in re­li­a­bil­ity and al­lowed ComEd to re­duce rates four of the nine years.”

At the same time, he said the com­pany will not con­done prac­tices such as rout­ing money to po­lit­i­cally fa­vored re­cip­i­ents, of­ten hid­den on the pay­rolls of sub­con­trac­tors. “We have taken all the cor­rec­tive ac­tions that we can against any­body that was or­ches­trat­ing this. They are no longer with ComEd,” he said.

Crane said Ex­elon is im­ple­ment­ing rules and track­ing mech­a­nisms for in­ter­ac­tions with pub­lic of­fi­cials, vet­ting and mon­i­tor­ing lob­by­ists and po­lit­i­cal con­sul­tants, and em­ploy­ment and ven­dor re­fer­rals from pub­lic of­fi­cials. He said the poli­cies will cover all com­pany sub­sidiaries, not just ComEd.

If ComEd com­plies with all terms, pros­e­cu­tors have agreed to drop the bribery charge af­ter three years, al­though it still must co­op­er­ate if the fed­eral probe con­tin­ues be­yond that time.

Crane said de­spite the tighter scru­tiny, ComEd will spend heav­ily on lob­by­ing when leg­isla­tive is­sues war­rant.

Crane de­clined to dis­cuss for­mer ComEd of­fi­cials im­pli­cated in the fed­eral com­plaint, such as Anne Pra­m­ag­giore, who last Oc­to­ber re­tired as se­nior ex­ec­u­tive vice pres­i­dent at Ex­elon. From 2012 to 2018, she was CEO of ComEd. While not iden­ti­fied in the com­plaint, her iden­tity is clear from the con­text.

A spokesman for Pra­m­ag­giore said she “has done noth­ing wrong and any in­fer­ence to the con­trary is mis­guided and false.” His state­ment con­tin­ued: “Dur­ing her ten­ure, she and other cur­rent and for­mer ComEd and Ex­elon ex­ec­u­tives re­ceived, eval­u­ated and granted many re­quests to pro­vide ap­pro­pri­ate and valu­able ser­vices to the com­pa­nies, none of which con­sti­tute un­law­ful ac­tiv­ity.”

PRO­VIDED

Ex­elon CEO Christo­pher Crane said the com­pany is work­ing on re­forms af­ter ComEd, a sub­sidiary, agreed to pay $200 mil­lion to set­tle a fed­eral probe into its lob­by­ing prac­tices.

Newspapers in English

Newspapers from USA

© PressReader. All rights reserved.