2020-21 SaskEnergy Corporate Governance

Corporate Governance

Robust Succession Process The SaskEnergy Executive team uses a semi-annual review process to: address strategic positions; keep the succession plan current through an evergreen process; respond to human resource developments; focus on continuous employee development; and mitigate succession and knowledge transfer risks. The Executive considers various strategic options to address short-term needs (emergency or unforeseen personal circumstances) and long-term needs (business structural changes and planned retirements). The Human Resources and Safety Committee of the Board of Directors receives a succession plan update semi-annually and reports to the Board on the succession management process. The Board of Directors and CEO directly oversee the succession plans for the CEO and the Executive. Communications (with the Shareholder and Stakeholders) SaskEnergy is committed to the principles of transparency, openness and timeliness in communication with its Owner, CIC, employees, stakeholders and the public. SaskEnergy regularly surveys employees and external stakeholders for feedback on its corporate activities and more information on these communications can be found in the MD&A section. The Corporation complies with the communication requirements set by the Shareholder and by statute, in accordance with the Board approved external communications policy. Through the Board Chair, the Board is accountable to the Minister Responsible for SaskEnergy. The Minister functions as a communication liaison among the Corporation, CIC, Cabinet, the Provincial Legislature and the public. As an entity subject to The Freedom of Information and Protection of Privacy Act, SaskEnergy strives to strike a balance between transparency and maintaining customer confidentiality in matters of communication and disclosure. The Corporation is subject to annual disclosure requirements of the Legislative Committee regarding Crown Payee Disclosure on all payments greater than $50,000 to employees and suppliers, and for all grants, donations, and sponsorships greater than $5,000. All major public disclosures of corporate performance of the Corporation are subject to prior approval of the Board. Senior Executive members of SaskEnergy also appear before Legislative Committees to answer questions relating to the business of the Corporation in preceding years. To facilitate feedback to and from the Owner, the Board Chair communicates with CIC, and also participates in a

In order to manage cyber security risk, SaskEnergy has developed a cyber security strategy whereby the Corporation tests its systems, builds controls and conducts investigations. This strategy is partly enshrined in the Enterprise Security Policy and the Acceptable Use of Technology Policy. In addition, the Corporation has added incremental resources to manage and evaluate cyber risks and privacy processes related to the growing adoption of cloud migration, data analytics and mobile technology. SaskEnergy proactively and continuously monitors its systems to identify and address malicious activity, as well as potential or emerging threats. Business continuity exercises are also conducted. Further, although business systems are secure and unauthorized access resulting in serious harm is unlikely, SaskEnergy deemed it prudent to obtain cyber insurance coverage to address costs associated with responding to and mitigating the outcomes of a cyber-attack, if one were to occur.

Integrity of Internal Controls and Management Systems

The Board and the Audit and Finance Committee receive reports from, and work closely with, internal and external auditors to promote financial transparency and ensure the integrity, effectiveness and adequacy of SaskEnergy’s internal controls and management systems. As part of SaskEnergy’s commitment to accountability, the Audit and Finance Committee reviews the financial performance of the Corporation quarterly. Natural gas purchase transactions and credit risk are reported by management and actively monitored by the Committee. Pursuant to the directive of CIC, SaskEnergy has a process in place regarding internal controls certification by the CEO and CFO. This process is designed to provide reasonable assurance regarding the effectiveness of SaskEnergy’s internal controls over financial reporting. SaskEnergy’s financial statements are prepared in accordance with International Financial Reporting Standards (IFRS). As part of the March 31 year- end audit, the external auditors have provided an opinion that the Corporation’s financial statements have been prepared in accordance with IFRS. The Board oversees the annual external audit plan of the appointed external auditor for the audit of the Corporation’s annual financial statements, and the annual internal audit plan carried out by SaskEnergy’s internal audit group. To preserve the independence of the role of the external auditors, the Audit and Finance Committee must pre-approve all non-audit services undertaken by the external auditor in accordance with the Corporation’s Non-Audit Services Policy.


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