Ethics report

A PROJECT REPORT

ON

BUSINESS ETHICS AND CORPORATE GOVERNANCE

ON “GENERAL ELECTRIC COMPANY”

Submitted To:

Mrs.Bhavika Batra

Submitted By:

Archana Shahi B-42

Vandana Monani B-14

Shraddha Patel B-

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INTRODUCTION

Portland General Electric Company is an investor-owned utility engaged in the generation,

transmission and distribution of electricity to industrial, commercial and residential

customers.

Operating in 52 Oregon cities, Portland General Electric Company serves approximately

825,000 customers, including nearly 100,000 commercial customers.

PGE receives oversight from state and federal regulatory agencies, including the Oregon

Public Utility Commission and the Federal Energy Regulatory Commission.

As Oregon's largest utility, the PGE service territory attracts major employers in diverse

industries, such as high technology and health care. Economic growth in northwest Oregon

continues to fuel our customer growth rate.

PGE has a diverse mix of stable generating resources that includes hydropower, coal and gas

combustion, wind and solar, as well as key transmission resources. Our 13 power plants have

a total combined generating capacity of 2,766 megawatts.

By managing our own power plants in conjunction with the available power supplies on the

wholesale market, management believes our fully integrated power supply operations provide

the flexibility and efficiency necessary to effectively balance our power supply resources to

achieve the lowest possible cost for customers.

We began our business back in 1889, when a generator at Willamette Falls in Oregon City

produced power to light 55 street lamps 14 miles away in Portland - the first long-distance

transmission line in the nation.

Welcome to PGE’s Code of Business Ethics and Conduct (Code of Ethics). This Code of

Ethics, which has been approved by the PGE Board of Directors, expresses the principles,

policies and practices every board member, officer and employee of Portland General

Electric Comp any and its subsidiaries (PGE or the Company) are expected to use when

conducting the Company’s business. It is not intended as an exhaustive list of the activities or

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practices that guide the behavior of employees or that could affect the reputation and

goodwill of PGE’s business. All employees are expected to be aware of and follow the

Company’s Core Principles, Guiding Behaviors, Corporate Policy, and individual

departments’ policies and practices. Your good judgment and discretion are essential in

determining appropriate conduct for any situation.

Ethical concerns are rarely clear-cut. As an employee of PGE, it is your responsibility to

identify and work to resolve such concerns. It’s important to question any ethical situations

that are not addressed in this Code of Ethics or that are not clear. In any situation where you

are unsure of your actions, ask yourself if you would be comfortable with your actions being

featured as a major story in the next day’s news.

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PGE’S CORE PRINCIPLES AND GUIDING BEHAVIORS

Core Principles

PGE has six core principles that express what is important to our Company and what

our customers expect from us every day. They are:

Safety and Health – We must provide a safe and healthy work environment that minimizes

risk to ourselves and our customers.

Continuous Improvement – Electricity is one of the foundations of modern life. To meet

and exceed our customers’ expectations, we must excel at the fundamentals, aim for

excellence in everything we do, and continuously improve.

Ethical Business Practices – To be effective, we must act with the highest levels of honesty,

integrity and compliance to earn and retain trust.

Diversity – We value diversity. The more our organization reflects the communities we

serve, and promotes inclusion, the more our organization will thrive.

Community Investment – Making strategic investments in our communities strengthens

them and our business. We focus investments in education; customer safety and providing a

safety net for people in need; and promoting a sustainable economy and environment.

Environmental Stewardship – We sustainably manage our business in an environmentally

responsible manner, acknowledging that environmental protection, social responsibility and

sound business practices are one and the same.

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Guiding Behaviours

The Guiding Behaviours is a set of values and perspectives that employees use to approach

everyday decisions and guide their behaviour in the workplace. By consistently modelling

these values, we generate a companywide ethical culture. As a PGE employee, you should

integrate these Guiding Behaviours into your daily work, and in part, measure your decisions

and behaviour against these ideals.

Be Accountable – As employees, we have choices. We are held accountable for those

choices. Accepting accountability as individual performers and for the performance of our

work group can be a challenge. Being accountable in all aspects of our work, however, can

make a tremendous difference in the satisfaction we receive from our work and the results we

achieve.

Dignify People – If we fail to listen and really understand our PGE co-workers and

customers, how can we expect them to hear us? An environment in which diverse voices are

not being heard can result in stagnation, a void of new ideas, lack of innovation and an

inability to grow and change.

Make the Right Thing Happen – There is no better time to begin creating a more action-

oriented culture at PGE than now. Jumping in and helping to get a job done or initiating

change will make you more effective. You have the power to influence others by staying

positive and encouraging innovation, flexibility and creativity. Don’t wait for someone else

or some other time.

Positive Attitude – At PGE, one of the greatest strengths we have is our positive attitude –

an inner belief that success is achievable. It’s important we bring that attitude to our

individual work and to our work as a team.

Team Behaviour – Putting the needs of the broader group first is an attitude that, in the end,

benefits everyone.

Earn Trust – As employees we must keep our promises and commitments, be honest and

straightforward and deal with issues fairly and consistently. It is through these behaviours

that we will earn the trust of our co-workers and customers.

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FAIRNESS IN THE WORKPLACE

PGE is committed to providing a workplace free of unlawful discrimination, harassment and

violence. All forms of these behaviors in the workplace are strictly prohibited and will not be

tolerated. If you believe you have been subjected to any of these behaviors you should report

the incident promptly.

Discrimination

PGE is an equal employment opportunity employer. PGE makes hiring decisions based solely

on jobrelated criteria without regard to race, color, age, religion, national origin, medical

condition (including pregnancy), disability, genetics, marital status, gender, sexual

orientation, gender identity, veteran status or on any other basis prohibited by law. This

policy covers all aspects of the employment relationship.

Harassment

PGE will not tolerate any form of harassment. Harassment can take many forms and includes

any behavior that has the purpose or effect of creating an intimidating, hostile or offensive

work environment or interferes with an individual’s work performance. Harassing conduct

includes, but is not limited to: using derogatory nicknames or slurs; negative stereotyping;

behaving in a threatening or intimidating

way; and verbal or physical conduct that degrades or shows hostility or hatred toward an

individual.

Displaying or circulating written or graphic material that ridicules or shows hostility or

aversion to an individual or group is also considered harassment. Forms of sexual harassment

include, but are not limited to: verbal harassment, such as unwelcome comments, jokes or

slurs of a sexual nature; physical harassment, such as unnecessary or offensive touching or

impeding or blocking movement; and visual harassment, such as offensive posters, cards,

cartoons, graffiti, drawings or gestures.

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Violence

PGE prohibits any act or behavior against an employee, contractor, temporary worker, guest,

visitor, or anyone else engaged in PGE business, that intimidates, threatens or causes harm to

persons or property, or is violent in nature.

If PGE is made aware of a threat of harm to an employee or employees, where prudent or

required, PGE will attempt to notify those who are the intended recipient of the threat as well

as contact the appropriate authorities.

Possession of weapons (other than pocketknives with a blade of four inches or less) or

materials, substances or explosives that may be used to cause harm to persons or property is

prohibited in the workplace or when on PGE business. This also applies to employees with

concealed weapons permits. Security employees are exempt from this prohibition.

Nepotism

PGE does not allow nepotism. Nepotism is favoritism shown to a relative, domestic partner

or spouse based on the relationship. Relatives, domestic partners and spouses will not be

treated differently from other applicants for employment. However, the employment process

requires stricter scrutiny whenever an employee might be involved in a workplace decision

involving a relative, domestic partner or spouse. A person may not enter into or stay in a

position where that person exercises supervisory, appointment, promotional or grievance

authority over a relative, spouse or domestic partner or otherwise creates a conflict of interest

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CODE OF ETHICS

Code of Ethics for Chief Executive and Senior Financial Officers.

On March 14, 2006, the Board of Directors adopted the Code of Ethics for Chief Executive

and Senior Financial Officers, replacing in its entirety the PGE Accounting and Reporting

Code of Ethics.

Purpose

Portland General Electric Company (the "Company") is committed to conducting its business

in accordance with applicable laws, rules and regulations and the highest ethical standards of

business conduct, and to full and accurate financial disclosure in compliance with applicable

law. This Code of Ethics for Chief Executive and Senior Financial Officers ("Financial Code

of Ethics") is applicable to the Company's Chief Executive Officer, Chief Financial Officer

and Controller (or persons performing similar functions) (together, the "Senior Financial

Officers"). In addition to complying with this Financial Code of Ethics, Senior Financial

Officers also must abide by the Company's Code of Business Ethics and Conduct and other

Company policies and procedures that govern the conduct of its business (collectively, the

"Company Policies"). The Company Policies set forth the fundamental principles and key

policies and procedures that govern the conduct of all of the Company's directors, officers

and employees in connection with the Company's business.

Ethical standards

Senior Financial Officers are required to conduct themselves honestly, ethically and with

absolute integrity with respect to the Company's business, including accounting and financial

reporting for the Company and, when acting at the request of the Company on behalf of

another entity or enterprise to which the Senior Financial Officer owes a fiduciary obligation,

with respect to accounting and financial reporting for that entity or enterprise. In addition, the

leadership responsibilities of the Company's Senior Financial Officers include creating a

culture of ethical business conduct and commitment to compliance, maintaining a work

environment that encourages employees to raise concerns, and promptly addressing employee

compliance concerns.

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Compliance with laws, rules and regulations

Senior Financial Officers are required to comply, and to cause the Company to comply, with

the laws, rules and regulations that govern the conduct of the Company's business and to

report any suspected violations in accordance with the section below entitled "Reporting of

Violations."

Conflicts of interest

A conflict of interest occurs when the private interests of a Senior Financial Officer interfere

in any way, or even appear to interfere, with the interests of the Company. The obligation of

Senior Financial Officers to conduct the Company's business in an honest and ethical manner

includes the ethical handling of actual or apparent conflicts of interest between personal and

professional relationships. A conflict situation can arise when a Senior Financial Officer

takes actions or has interests that may make it difficult to perform his or her company work

objectively and effectively. Conflicts of interest also arise when a Senior Financial Officer, or

a member of his or her family, receives improper personal benefits as a result of the Senior

Financial Officer's position in the Company. Before accepting any position or benefits,

making any investment, participating in any transaction or business arrangement or otherwise

acting in a manner that creates or appears to create a conflict of interest with the Company, a

Senior Financial Officer must comply with his or her reporting obligations under the

Company's Code of Business Ethics and Conduct.

Disclosures

It is Company policy to make full, fair, accurate, timely and understandable disclosure in

compliance with all applicable laws and regulations in all reports and documents that the

Company files with, or submits to, the Securities and Exchange Commission and in all other

public communications made by the Company. Senior Financial Officers are required to

promote compliance by all employees with this policy and to abide by Company standards,

policies and procedures designed to promote compliance with this policy.

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Reporting of violations

If a Senior Financial Officer knows of or suspects a violation of applicable laws, rules or

regulations or this Financial Code of Ethics, he or she must immediately report that

information to the Company's Compliance Officer, General Counsel, any member of the

Audit Committee of the Board of Directors or any member of the Board of Directors. No one

will be subject to retaliation because of a good faith report of a suspected violation.

Compliance with Financial Code of Ethics

Senior Financial Officers must comply with this Financial Code of Ethics at all times. Senior

Financial Officers will be requested periodically to certify that they are in compliance with

this Financial Code of Ethics.

This Financial Code of Ethics is important and must be taken seriously by all Senior

Financial Officers. The Board of Directors shall determine, or designate appropriate persons

to determine, appropriate actions to be taken in the event of violations of this Financial Code

of Ethics. Disciplinary action, including, but not limited to, written notices or warnings,

reprimands, demotion or reassignment, suspension with or without pay or benefits, or

termination, may result for those Senior Financial Officers who fail to comply with this

Financial Code of Ethics. In determining what action is appropriate in a particular case, the

Audit Committee of the Board of Directors or its designee may, but will not be required to,

take into account all relevant information, including the nature and severity of the violation,

whether the violation was a single occurrence or repeated occurrences, whether the individual

in question had been advised prior to the violation as to the proper course of action and

whether or not the individual in question had committed other violations in the past.

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Waivers; Amendments

If any Senior Financial Officer would like to seek a waiver of this Financial Code of Ethics,

he or she must make full disclosure of his or her particular circumstances to either the

Company's Compliance Officer or General Counsel. Such officer is responsible for making a

determination as to whether the request will be submitted to the Audit Committee for its

consideration. Only the Audit Committee can approve a waiver of this Financial Code of

Ethics.

This Financial Code of Ethics may be amended from time to time by resolution of the Board

of Directors of the Company. Waivers of and amendments to this Financial Code of Ethics

will be publicly disclosed to the extent required by applicable law and regulations.

No rights created

This Financial Code of Ethics is a statement of certain fundamental principles, policies and

procedures that govern the Company's Senior Financial Officers in the conduct of the

Company's business. It is not intended to and does not create any rights in any employee,

customer, supplier, competitor, shareholder or any other person or entity.

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OREGON PUBLIC UTILITY COMMISSION

The Oregon Public Utility Commission (OPUC) regulates all aspects of PGE’s provision of

retail electricity services, including the rates, terms and conditions of service and access to

distribution services by electricity service suppliers. PGE may not charge any rates for retail

regulated services that are not approved by the OPUC and may not discriminate among

similarly situated customers.

Environmental Regulations

PGE maintains an environmental policy to ensure it complies with all applicable laws and

regulations while meeting the highest standards of environmental stewardship. All

employees, officers and board members must understand and fully comply with all applicable

environmental laws related to their part of the Company’s business and activities. PGE

facilities and operations are subject to a large variety of requirements that control air

emissions, discharges of effluent and water, handling of solid and hazardous waste and the

unintended or uncontrolled release of pollutants and hazardous substances to the air, water or

land. Such a release, even if accidental, must be reported to your supervisor or manager

immediately. PGE is often required to report such incidents to governmental authorities.

Antitrust Laws

Antitrust laws can be complex, and it is impossible to describe them fully in any code of

ethics. In general, antitrust laws prohibit agreements among competitors on matters such as

prices, terms of sale and allocations of markets or customers. Courts can — and do — infer

agreements based on “loose talk,” informal discussions or the mere exchange between

competitors of information from which pricing or other collusion could result. Should you

become aware of such situations, you should report them immediately.

Political Activities

Corporate political activities, including political contributions, are governed by federal, state

and local laws and regulations. Political contributions include monetary donations to political

parties or candidates, lobbying of legislators or public officials, use of employees.

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CONFIDENTIAL INFORMATION

Detailed and up-to-date information is increasingly important in how PGE conducts its

business. As with any other asset — a power line, a truck or a computer — you are

responsible for protecting confidential information.

Confidential Information and Trade Secrets

Some of the information you receive in the course of your work is confidential. You must

protect and prevent the disclosure of confidential information PGE entrusts to you, except

when disclosure is authorized or legally mandated. You must also protect confidential

information provided by any customer, supplier or would-be supplier, including prices, terms

and names of other sources of supply. Confidential information includes all proprietary or

non-public information that might be useful to others or harmful to the Company or its

customers, if disclosed. Examples can include business concepts, trade secrets, lists of leads

or prospects, business and product plans, information about PGE’s business methods,

computer programs, customer and employee information and more. You may not use any

confidential information for your own benefit or the benefit of persons inside or outside PGE.

Your obligation to protect from disclosure any confidential business information acquired

during your service with PGE continues even after you leave the Company. You must not

disclose any confidential PGE information to a new employer or others after you leave the

Company. You also may not disclose your previous employers’ confidential information to

PGE board members, officers or employees.

Gathering Information About Other Businesses

It is entirely proper to gather information about other businesses, including those we serve

and those with whom we compete in various ways. You must never attempt, however, to

acquire trade secrets or other proprietary information through unlawful or unethical means,

such as theft, spying, bribery or breach of a non-disclosure agreement. You should be able to

identify the source of any information you acquire about another business.

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Trademarks, Copyrights and Other Intellectual Property

PGE recognizes and respects the individual property rights of others. When using the name,

trademarks, logos or printed materials of another company, you must do so properly and in

accordance with applicable law.

Trademarks: PGE’s logos and the name Portland General Electric Company are examples

of Company trademarks. You must always use our trademarks properly and advise your

supervisor or the Legal department of infringements by others.

Copyright Compliance

Books, articles, drawings, computer software and other such materials may be covered by

copyright laws. It is a violation of those laws to make unauthorized copies of copyrighted

materials. Availability on an Internet website or the absence of a copyright notice does not

necessarily mean that materials are not copyrighted. The Company licenses the use of much

of its computer software from outside companies. In most instances, this computer software

is protected by copyright. You may not make, acquire or use unauthorized copies of computer

software.

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CORPORATE GOVERNANCE

CATEGORICAL STANDARDS FOR DETERMINATION OF DIRECTOR INDEPENDENCE

Purpose

The Board of Directors has adopted the following categorical standards to assist it in

evaluating the independence of each member of the Board. The standards describe various

types of relationships that could potentially exist between a Director and Portland General

Electric Company ("Company" or "PGE") and sets thresholds at which such relationships

could be material. The standards are intended to comply with the listing standards of the New

York Stock Exchange (the "NYSE Standards"). In applying the standards, "Company" or

"PGE" refers to PGE and its direct and indirect subsidiaries.

Categorical standards

Relationships to Company: A director is not independent if during the three fiscal years

preceding the determination:

1. The director is employed by the Company;

2. An immediate family member of the director is an executive officer of the Company;

3. The director receives more than $100,000 per year in direct compensation from the

Company, other than director and committee fees (including fees in the form of shares,

options to purchase Company shares or similar compensation) and pension or other forms

of deferred compensation for prior service that is not contingent on any continued service;

or

4. An immediate family member of the director receives more than $100,000 per year in

direct compensation from the Company, other than director and committee fees

(including fees in the form of shares, options to purchase Company shares or similar

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compensation) and pension or other forms of deferred compensation for prior service that

is not contingent on any continued service.

Relationships to Auditor. A director is not independent if:

1. The director is a partner or employee of, or is otherwise affiliated with, the Company's

independent auditor;

2. An immediate family member of the director is a partner of, or is employed or otherwise

affiliated in a professional capacity with, the Company's independent auditor; or

3. During the three fiscal years preceding the determination, the director or an immediate

family member of the director was (but no longer is) a partner or employee of the Company's

independent auditor and personally worked on the Company's audit within that time.

Interlocking Relationships: A director is not independent if, during the three fiscal years

preceding the determination, an executive officer of PGE is on the compensation committee

of the board of directors of a company which employs the director or an immediate family

member of the director as an executive officer.

Relationships to Customers: A director is not independent if during the three fiscal years

preceding the determination:

1. The director is an executive officer or employee of a company that does business with PGE

and the sales by that company to PGE or the purchases by that company from PGE

(excluding sales of electricity under PGE's filed tariffs), in any single fiscal year during the

determination period, are more than the greater of two percent of the annual consolidated

gross revenues of that company or $1 million; or

2. An immediate family member of the director is an executive officer of a company that

does business with PGE and the sales by that company to PGE or the purchases by that

company from PGE (excluding sales of electricity under PGE's filed tariffs), in any single

fiscal year during the determination period, are more than the greater of two percent of the

annual consolidated gross revenues of that company or $1 million.

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Indebtedness: A director is not independent if at the time of the determination:

1. The director is an executive officer or employee of another company which is indebted to

PGE or to which PGE is indebted, and the total amount of either company's indebtedness to

the other at the end of the last fiscal year is more than one percent of the other company's

total consolidated assets; or

2. An immediate family member of the director is an executive officer of another company

which is indebted to PGE or to which PGE is indebted, and the total amount of either

company's indebtedness to the other at the end of the last fiscal year is more than one percent

of the other company's total consolidated assets.

Relationships to Charities. A director is not independent if at the time of the determination

the director serves as an executive officer or director of a charitable organization and the

Company's discretionary charitable contributions to the organization exceed the greater of $1

million or two percent of that organization's total annual charitable receipts during its last

competed fiscal year. Neither the Company's automatic matching of employee charitable

contributions nor contributions from the PGE Foundation will be included in the amount of

the Company's contributions for this purpose.

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The following Corporate Governance Guidelines have been adopted by the Board of Directors (the

"Board") of Portland General Electric Company (the "Company") to assist the Board in the exercise

of its responsibilities. These Corporate Governance Guidelines are not intended to change or interpret

any Federal or state law or regulation, including the laws of the State of Oregon, or the Articles of

Incorporation or Bylaws of the Company. These Corporate Governance Guidelines are subject to

modification from time to time by the Board.

THE BOARD

1) Role Of Directors:

The business and affairs of the Company shall be managed under the direction of the Board.

A director is expected to spend the time and effort necessary to properly discharge his or her

responsibilities. Accordingly, a director is expected to regularly attend meetings of the Board

and committees on which the director sits, and to review prior to meetings material

distributed in advance for the meetings. A director who is unable to attend a meeting (which

it is understood will occur on occasion) is expected to notify the Chairman of the Board or

the chairperson of the appropriate committee in advance of the meeting.

2)The Board's Goals:

The Board's goal is to build long-term value for the Company's shareholders and to assure the

vitality of the Company for its customers, employees and the other individuals and

organizations who depend on the Company.

To achieve these goals the Board will monitor both the performance of the Company (in

relation to its goals, strategy and competitors) and the performance of the Chief Executive

Officer, and offer him or her constructive advice and feedback. When it is appropriate or

necessary, it is the Board's responsibility to remove the Chief Executive Officer and to select

his or her successor.

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3).Selection of the Chairman of the Board:

To the extent provided in the Company's Bylaws, the Board shall be free to choose its

Chairman of the Board in any way that it deems best for the Company at any given point in

time.

4) Size of the Board:

The Board believes that it should generally have no fewer than 5 and no more than 11

directors. This range permits diversity of experience without hindering effective discussion or

diminishing individual accountability. The size of the Board could, however, be increased or

decreased by resolution of the Board, if determined to be appropriate by the Board. For

example, it may be desirable to increase the size of the Board in order to accommodate the

availability of an outstanding candidate for director.

a. Board Orientation and Continuing Education.

The Company will provide new directors with a director orientation program to familiarize

such directors with, among other things, the Company's business, strategic plans, significant

financial, accounting and risk management issues, compliance programs, conflicts policies,

the Code of Business Ethics and Conduct, these Corporate Governance Guidelines, principal

officers, internal auditors and independent auditors.

The Company also encourages directors to attend outside director education programs and

shall reimburse each director for the cost of attending one such program per year, including

the cost of the program and reasonable related travel and lodging expenses. If the director

serves on the board of one or more other public companies, the director will seek to have

such other companies share equally in the cost of attending such programs.

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DIRECTORS

A) Selection of New Directors:

The Board shall be responsible for nominating members for election to the Board and, in

accordance with the Company's Bylaws, for filling vacancies on the Board that may occur

between annual meetings of shareholders. The Nominating and Corporate Governance

Committee is responsible for identifying, screening and recommending candidates to the

Board for Board membership. When formulating its Board membership recommendations,

the Nominating and Corporate Governance Committee shall also consider advice and

recommendations from others as it deems appropriate.

The Nominating and Corporate Governance Committee will consider candidates

recommended by shareholders. In considering candidates submitted by shareholders, the

Nominating and Corporate Governance Committee will take into consideration the needs of

the Board and the qualifications of the candidate. The Nominating and Corporate Governance

Committee may establish procedures, from time to time, regarding shareholder submission of

candidates.

B) Board Membership Criteria:

The Nominating and Corporate Governance Committee shall be responsible for developing

and recommending a set of criteria for selecting candidates to serve as directors of the

Company, and for periodically reviewing and suggesting changes to the criteria.

The Nominating and Corporate Governance Committee may apply several criteria in

selecting nominees. At a minimum, the Committee shall consider (i) whether the nominee has

demonstrated by significant accomplishment in his or her field an ability to make a

meaningful contribution to the Board's oversight of the business and affairs of the Company

and (ii) the nominee's reputation for honesty and ethical conduct in his or her personal and

professional activities. Additional factors which the Committee may consider include a

nominee's specific experiences and skills, relevant industry background and knowledge,

business judgment, time availability in light of other commitments, diversity, age, potential

conflicts of interest, material relationships with the Company and independence from

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management and the Company. The Committee also may seek to have the Board represent a

diversity of backgrounds, experience, gender and race and may consider such other relevant

factors that the Committee regards as appropriate in the context of the needs of the Board.

Each director shall be expected, within a reasonable period of time following his or her

election to the Board, to own shares in the Company in an amount that is appropriate for such

director's financial circumstances.

C) Other Public Company Directorships:

In general, the Company does not have a policy limiting the number of other public company

boards of directors upon which a director may sit. However, the Nominating and Corporate

Governance Committee shall consider the number of other public company boards and other

boards (or comparable governing bodies) on which a prospective nominee is a member.

Although the Company does not impose a limit on outside directorships, it does recognize the

substantial time commitments attendant to Board membership and expects that the members

of its Board be fully committed to devoting all such time as is necessary to fulfill their Board

responsibilities, both in terms of preparation for, and attendance and participation at

meetings. Each member of the Board will inform the Secretary of the Company and the

Chairman of the Nominating and Corporate Governance Committee before becoming a

member of another board of directors or an officer of another company. Sufficient time will

be allowed before accepting such a position for the Company to determine whether any

interlocking director or officer restrictions may apply, and for the Chairman of the Committee

to evaluate any impact on fulfilment of Board responsibilities.

D) Directors Who Change Their Present Job Responsibility:

The Board does not believe that directors who retire from, or change, the principal occupation

they held when they became a member of the Board should necessarily leave the Board.

Promptly following such event, the director must notify the Nominating and Corporate

Governance Committee, which shall review the continued appropriateness of the affected

director remaining on the Board under the circumstances. The affected director is expected to

act in accordance with the Nominating and Corporate Governance Committee's

recommendation following such review.

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E) Retirement Age:

It is the general policy of the Company that no director having attained the age of 75 years

shall be nominated for re-election or reappointment to the Board. However, the Board may

determine to waive this policy in individual cases.

F) Director Tenure:

In connection with each director nomination recommendation, the Nominating and Corporate

Governance Committee shall consider the issue of continuing director tenure and take steps

as may be appropriate to ensure that the Board maintains an openness to new ideas and a

willingness to critically re-examine the status quo. An individual director's re-nomination is

dependent upon such director's performance evaluation, as well as a suitability review, each

to be conducted by the Nominating and Corporate Governance Committee in connection with

each director nomination recommendation.

G) Retirement of Chief Executive Officer:

The board of directors believes that, as a matter of general policy, when a Chief Executive

Officer retires from the company, the Chief Executive Officer should also resign from the

board of directors. Therefore, as part of the Chief Executive Officer's notification to the board

of directors of his or her retirement, the Chief Executive Officer shall also submit an offer of

resignation from the board of directors effective upon his or her retirement date.

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INDEPENDENCE

A) Independence of the Board:

The Board shall be comprised of a majority of directors who qualify as independent directors

("Independent Directors") under the listing standards of the New York Stock Exchange (the

"NYSE Standards"). No more than two management executives may serve on the Board at

the same time.

The Board shall review annually the relationships that each director has with the Company

(directly or as a partner, shareholder or officer of an organization that has a relationship with

the Company). Following such annual review, only those directors who the Board

affirmatively determines have no material relationship with the Company (either directly or

as a partner, shareholder or officer of an organization that has a relationship with the

Company) will be considered Independent Directors, subject to additional qualifications

prescribed under the NYSE Standards or applicable law. The Board has adopted the

categorical standards attached hereto as an Addendum to assist it in determining director

independence. In the event that a director becomes aware of any change in circumstances that

may result in the director no longer being considered independent under the NYSE Standards,

the categorical standards or under applicable law, the director shall promptly inform the

Chairperson of the Nominating and Corporate Governance Committee.

B) Lead Independent Director:

If the Chairman of the Board is not an Independent Director, the Company's Independent

Directors will designate one of the Independent Directors on the Board to serve as a lead

Independent Director (the "Lead Independent Director"). If the Chairman of the Board is an

Independent Director, then he or she shall be deemed the Lead Independent Director and

shall perform the duties of the Lead Independent Director as set forth herein. The Lead

Independent Director's duties will include coordinating the activities of the Independent

Directors, coordinating the agenda for and moderating sessions of the Board's Independent

Directors and other non-management directors, and facilitating communications among the

other members of the Board.

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In performing the duties described above, the Lead Independent Director is expected to

consult with the chairpersons of the appropriate Board committees and solicit their

participation in order to avoid diluting the authority or responsibilities of the committee

chairpersons.

C) Separate Sessions of Non-Management Directors:

The non-management directors of the Company shall meet in executive session without

management on a regularly scheduled basis, but not less frequently than quarterly. The

Chairman or, if the Chairman is not an Independent Director, the Lead Independent Director

shall preside at such executive sessions, or in such director's absence, another Independent

Director designated by the Chairman or Lead Independent Director shall preside at such

executive sessions.

In the event that the non-management directors include directors who are not independent

under the NYSE Standards, the Board will, at least once a year, schedule an executive session

including only Independent Directors.

Communications with Non-management Directors:

Any interested parties desiring to communicate with the Lead Independent Director, the

Chairperson of the Audit Committee or the other non-management directors regarding the

Company may directly contact such directors.

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BOARD COMPENSATION

A director who is also an officer of the Company shall not receive additional compensation

for service as a director.

The Company believes that compensation for non-employee directors should be competitive

and should encourage increased ownership of the Company's shares through the payment of a

portion of director compensation in Company shares, options to purchase Company shares or

similar compensation. The Compensation and Human Resources Committee will periodically

review the level and form of the Company's director compensation, including how such

compensation relates to director compensation of companies of comparable size, industry and

complexity. Such review will also include a review of both direct and indirect forms of

compensation to the Company's directors, including any consulting or other similar

arrangements between the Company and a director. Changes to director compensation will be

proposed to the full Board for consideration.

A member of the Audit Committee may not receive any consulting, advisory, or other

compensatory fees from the Company or any subsidiary except director's fees (including fees

in the form of shares, options to purchase Company shares or similar compensation and any

additional amounts paid to chairpersons and members of committees of the Board); provided,

however, that a member of the Audit Committee may also receive fixed amounts of

compensation under a retirement plan (including deferred compensation) from the Company

for prior service with the Company so long as such compensation is not contingent in any

way on continued service.

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DIRECTOR AND EXECUTIVE OFFICER STOCK

OWNERSHIP REQUIREMENTS

A) General:

The Board believes that it is in the best interest of the Company, and its shareholders and

customers, to require directors and executive officers to retain ownership of a substantial

amount of Company common stock in order to:

Create financial incentives that align the interests of directors and executive officers with

strong operating and financial performance of the Company;

Enhance the commitment of directors and executive officers to the long-term future of the

Company and encourage executive officers to operate the business of the Company with a

long-term perspective when appropriate; and

Align the Company's governance practices with current best practices.

In this regard, the Board has adopted minimum stock ownership requirements.

B) Non-Employee Directors:

Each non-employee director shall be required to own Company common stock with a market

value of at least three times the annual equity retainer fee. Each non-employee director shall

meet such requirement by the later of (i) March 31, 2015 or (ii) five years from the first

annual meeting at which such director is elected.

Once a non-employee director reaches the stock ownership requirement under this provision

(based on the then current stock price and share holdings), such director will remain in

compliance despite future changes in stock price, as long as such director continues to own

the minimum number of shares that brought the director into compliance with the stock

ownership requirement.

In the event of an increase in the annual equity retainer fee for non-employee directors, non-

employee directors who have already met the stock ownership requirement will only need to

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increase their common stock ownership to reflect the amount of the increase in the annual

equity retainer fee. In the event of such an increase, the Nominating and Corporate

Governance Committee will determine the appropriate date by which non-employee directors

must reach the new common stock ownership amount required by such increase.

Until non-employee directors meet the stock ownership requirement described above, they

must retain an amount of shares equal to at least 50% of the net after-tax shares from the

vesting or exercise of equity awards granted by the Company in payment of the director's

annual equity retainer fee. This retention requirement only applies to equity awards granted

after October 26, 2011.

C) Executive Officers:

Minimum Ownership Amounts. The Chief Executive Officer is expected to retain 3x his

annual base salary in Company common stock. All other executive officers are expected to

retain 1x their annual base salary in Company common stock. For purposes of this

requirement, the executive officers of the Company shall include the Chief Executive Officer

and all vice presidents.

1. Transition Rules – Chief Executive Officer. If the Chief Executive Officer as of February

16, 2011 (the effective date of this provision) has not reached the applicable share ownership

target, he is not required to acquire additional shares to meet such target, but is required to

retain an amount of shares equal to 50% of the net after-tax shares (based on the statutory

withholding rate) acquired from vests of equity awards under the Company's long term

incentive program, after February 16, 2011, until the share ownership target is reached. In

addition, he is required to retain 100% of his shares that were vested as of February 16, 2011,

until the share ownership target is reached. Once he has exceeded the share ownership target,

he may dispose of shares, provided that he continues to meet the share ownership target.

2. Transition Rules – Other Executive Officers. All other executive officers shall not be

subject to any retention requirements with respect to shares vested as of February 16, 2011.

This stock ownership requirement shall not restrict the ability of such executive officers to

sell or otherwise dispose of such shares. If such an executive officer has not reached the

applicable share ownership target, he or she is not required to acquire additional shares to

meet such target, but is required to retain an amount of shares equal to 50% of the net after-

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tax shares (based on the statutory withholding rate), acquired after February 16, 2011,

pursuant to vests of equity awards under the Company's long term incentive program. This

requirement shall continue until such 50% of net after-tax shares is sufficient to meet the

share ownership target. Thereafter, the executive officer must retain an amount of shares

sufficient to meet the share ownership target.

3. Executive Officers Appointed after February 16, 2011. Executive officers appointed after

February 16, 2011 shall not be subject to any retention requirements with respect to shares

vested as of the date of appointment as an executive officer, and this stock ownership

requirement shall not restrict the ability of such executive officers to sell or otherwise dispose

of such shares. If such an executive officer has not reached the applicable share ownership

target, he or she is not required to acquire additional shares to meet such target, but is

required to retain an amount of shares equal to 50% of the net after-tax shares (based on the

statutory withholding rate) acquired, after the date of such person's appointment as an

executive officer, from vests of equity awards under the Company's long term incentive

program. This requirement shall continue until such 50% of net after-tax shares equals or

exceeds the share ownership target. Thereafter, the executive officer must retain an amount of

shares sufficient to meet the share ownership target.

4. Reports Each executive officer shall annually report to the Corporate Secretary, as of

December 31 of each year, the number of shares of Company common stock held by such

executive officer.

5. Changes in Stock Price or Base Salary Once an executive officer reaches the stock

ownership requirement under this provision (based on the then current stock price and share

holdings), such executive officer will remain in compliance despite future changes in stock

price, as long as such executive officer continues to own the minimum number of shares that

brought him or her into compliance with the stock ownership requirement.

In the event of an increase in the annual base salary of an executive officer who has already

met the stock ownership requirement, such executive officer will only need to increase his or

her common stock ownership to reflect the amount of the increase in annual base salary. In

the event of such an increase, the executive officer shall be required to retain an amount of

shares equal to 50% of the net after-tax shares (based on the statutory withholding rate)

acquired, after the relevant measurement date, from vests of equity awards under the

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Company's long term incentive program, until such time as the executive officer meets the

stock ownership requirement.

D) Amendments:

The Nominating and Corporate Governance Committee and the Compensation and Human

Resources Committee shall annually review the stock ownership requirements set forth

above, and the ownership of each non-employee director and each executive officer relative

to these requirements, and may recommend changes, as it deems appropriate, for approval by

the Board of Directors.

E) Waivers:

The Nominating and Corporate Governance Committee may grant waivers of this

requirement in circumstances where a non-employee director or an executive officer wishes

to sell shares of Company common stock because of financial hardship or other special

circumstances, or as other otherwise deemed appropriate by the Nominating and Corporate

Governance Committee.

Self-Evaluation by the Board

The Nominating and Corporate Governance Committee will sponsor an annual self-

assessment of the Board's performance as well as coordinate the self-evaluation of each

standing committee of the Board. The results of the evaluations of the Board and the standing

committees will be discussed with the full Board. The assessment should include a review of

any areas in which the Board or management believes the Board can make a better

contribution to the Company. The Nominating and Corporate Governance Committee will

utilize the results of this self-evaluation process in assessing and determining the

characteristics and critical skills required of prospective candidates for election to the Board

and making recommendations to the Board with respect to assignments of Board members to

various committees. The purpose of the evaluations is to assess the Board's and each

committee's functioning as a whole, not to focus on the performance of individual Board

members.

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Strategic Direction of the Company

Normally it is management's job to formalize, propose and implement strategic choices and

the Board's role to approve strategic direction and evaluate strategic results. However, as a

practical matter, the Board and management will be better able to carry out their respective

strategic responsibilities if there is an ongoing dialogue among the Chief Executive Officer,

other members of top management and the Board. To facilitate such discussions, members of

senior management who are not directors may be invited to participate in Board meetings

when appropriate.

Board Access to Management

Board members shall have access to the Company's management and, as appropriate, to the

Company's outside advisors. Board members shall coordinate such access through the Chief

Executive Officer and Board members will use judgment to assure that this access is not

distracting to the business operation of the Company.

Board Interaction with Institutional Investors, Analysts, Press and Customers

The Board believes that management generally should speak for the Company. It is suggested

that each director shall refer all inquiries from institutional investors, analysts, the press or

customers to the Chief Executive Officer or his or her designee.

Director Attendance at Annual Meetings of Shareholders.Directors are expected to attend the

Company's annual meeting of shareholders. A director who is unable to attend the Company's

annual meeting of shareholders (which it is understood will occur on occasion) is expected to

notify the Chairman of the Board.

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BOARD MEETINGS

A) Frequency of Meetings:

There shall be not less than four regularly scheduled meetings of the Board each year. At

least one regularly scheduled meeting of the Board shall be held quarterly.

B) Selection of Agenda Items for Board Meetings:

The Chairman of the Board, in consultation with the Lead Independent Director if separate

from the Chairman of the Board, and the Chief Executive Officer shall annually prepare a

Board of Directors "Master Agenda." This Master Agenda shall set forth a general agenda of

items to be considered by the Board at each of its specified meetings during the year.

Thereafter, the Chairman of the Board, in consultation with the Lead Independent Director if

separate from the Chairman of the Board, and the Chief Executive Officer may adjust the

Master Agenda to include special items not contemplated during the initial preparation of the

annual Master Agenda.

Upon completion, a copy of the Master Agenda shall be provided to the entire Board. Each

Board member shall be free to suggest inclusion of items on the Master Agenda as well as

raise at any Board meeting subjects that are not specifically on the Master Agenda for that

meeting.

Matters management desires to submit to the Board shall be submitted through the Corporate

Secretary who shall coordinate with the Chairman of the Board regarding the inclusion of

such matters on the agenda for a particular meeting.

C) Attendance of Management Personnel at Board Meetings:

The Board encourages the Chief Executive Officer to bring officers and other members of

management from time to time into Board meetings to (i) provide management insight into

items being discussed by the Board; (ii) make presentations to the Board on matters within

the manager's areas of responsibility; and (iii) bring officers and managers with significant

career potential at the Company into contact with the Board. Attendance of such officers and

managers at Board meetings is at the discretion of the Board. Should the Chief Executive

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Officer desire to add officers and managers as attendees on a regular basis, this should be

suggested to the Board for its concurrence.

D) Board Materials Distributed in Advance:

Information and materials that are important to the Board's understanding of the agenda items

and other topics to be considered at a Board meeting should, to the extent practicable, be

distributed sufficiently in advance of the meeting to permit prior review by the directors. In

the event of a pressing need for the Board to meet on short notice or if such materials would

otherwise contain highly confidential or sensitive information, it is recognized that written

materials may not be available in advance of the meeting.

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COMMITTEE MATTERS

A) Number and Names of Board Committees:

The Company shall have the following standing committees: Audit Committee, Nominating

and Corporate Governance Committee, and Compensation and Human Resources

Committee. The purpose and responsibilities for each of these committees shall be outlined in

committee charters adopted by the Board. The Board may, from time to time, form new

standing or special committees and determine the composition and areas of competence of

such committees, or disband a current committee depending on circumstances.

B) Independence of Board Committees:

Each of the Audit Committee, the Nominating and Corporate Governance Committee and the

Compensation and Human Resources Committee shall be composed entirely of Independent

Directors satisfying NYSE Standards and any other applicable legal and regulatory

requirements necessary for an assignment to any such committee. All other standing Board

committees shall be chaired by Independent Directors, unless the Board determines otherwise

with respect to a specific committee.

C) Assignment and Rotation of Committee Members:

The Nominating and Corporate Governance Committee shall be responsible, after

consultation with the Chairman of the Board, and if separate from the Chairman of the Board

the Lead Independent Director, for making recommendations to the Board with respect to the

assignment of Board members to various committees. After reviewing the Nominating and

Corporate Governance Committee's recommendations, the Board shall be responsible for

appointing the chairpersons and members to the committees on an annual basis.

The Nominating and Corporate Governance Committee shall annually review the committee

assignments and shall consider the rotation of the chairpersons and members with a view

toward balancing the benefits derived from continuity against the benefits derived from the

diversity of experience and viewpoints of the various directors. With regard to the

chairperson of the Nominating and Corporate Governance Committee, such position shall

rotate at least once every five years.

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LEADERSHIP DEVELOPMENT

A) Selection of the Chief Executive Officer:

The Board shall be responsible for identifying potential candidates for, and selecting, the

Company's Chief Executive Officer. In identifying potential candidates for, and selecting, the

Company's Chief Executive Officer, the Board shall consider, among other things, a

candidate's experience, understanding of the Company's business environment, leadership

qualities, knowledge, skills, expertise, integrity, and reputation in the business community.

B) Evaluation of Chief Executive Officer:

The Nominating and Corporate Governance Committee will have responsibility for

overseeing the design of the process for the annual performance review of the Chief

Executive Officer. The review should be timed to coincide with the annual evaluation of the

Chief Executive Officer's performance and the determination and approval of compensation

for the Chief Executive Officer. The following steps will be utilized to carry out this review:

The Chief Executive Officer will develop a self-evaluation at the end of each fiscal year

and coordinate with the Nominating and Corporate Governance Committee to present this

to the non-management members of the Board within one month of the end of the fiscal

year. The Chief Executive Officer's presentation may be delivered either orally or in

writing.

The non-management directors will meet with and without the Chief Executive Officer

and provide their assessment of the Chief Executive Officer's performance to the

Compensation and Human Resources Committee. These assessments should include the

directors' appraisal of:

1) The Company's performance and the Chief Executive Officer's contribution to it, both

compared to competitors and the Company's own strategic goals;

2) Achievement of personal goals set by the Chief Executive Officer for the year, as part of

his or her self-evaluation; and

3) Other aspects of the Chief Executive Officer's performance which the non-management

director deems relevant.

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The Independent Directors will complete the evaluation of the Chief Executive Officer's

performance following the Chief Executive Officer's presentation to the Board. Following

such evaluation, the Compensation and Human Resources Committee will determine and

approve, either as a committee or together with the other Independent Directors (if directed

by the Board), the Chief Executive Officer's compensation level based on such evaluation.

C) Succession Planning:

The Board shall plan for the succession to the position of the Chief Executive Officer. The

Nominating and Corporate Governance Committee, either as a committee or together with

the full Board, shall annually review the Chief Executive Officer and senior management

succession plans. If the Nominating and Corporate Governance Committee conducts this

review as a committee, it shall annually report to the Board on the results of its review.

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