Bethany M. Owen
ALLETEAbout Bethany M. Owen
Bethany M. Owen is Chair, President, and CEO of ALLETE; Board Chair since May 2021, CEO since February 2020, President from January 2019 to February 2020, and Director since 2019. She is 59, with deep experience in strategy, regulatory policy, renewable energy, ERM, cybersecurity, IT strategy, compliance, governance, and business transformation, having served in increasing responsibility over two decades since first joining ALLETE as an attorney . Performance context: 2024 AIP paid 153.2% of target driven by above-target net income, superior cash from operations, and above-target strategic results; operational and safety were below target . Long-term metrics show mixed results: 2021–2023 TSR ranked 53rd percentile with 107.5% payout; EPS CAGR 8% with 200% payout . For the three-year period ended 2024, TSR ranked 46th percentile with an 89.9% payout, while EPS CAGR was 3% and resulted in no payout .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| ALLETE | Chair, President, and CEO | Since May 2021 (Chair); Feb 2020–May 2021 (CEO); Jan 2019–Feb 2020 (President) | Led strategy, governance, and transformation across utility and clean energy portfolio |
| ALLETE | SVP, Chief Legal & Administrative Officer, and Secretary | 2016–Jan 2019 | Oversaw legal, governance, ERM, compliance, cybersecurity, and IT strategy |
| ALLETE/Minnesota Power; Superior Water, Light & Power (SWL&P) | Vice President roles and President of SWL&P | 2012–2016 (VP roles); 2010–2012 (SWL&P President) | Drove operational execution and regulatory policy; led subsidiary operations |
External Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| University of Minnesota Foundation | Board of Trustees | Since 2021 | Oversight of fundraising and endowment investment for UMN |
| Minnesota Governor's Advisory Council on Climate Change | Member | Since Nov 2023 | Advises on GHG reduction and climate resilience policy |
| Public Company Boards | None | — | No other public company directorships reported |
Fixed Compensation
| Metric | FY 2022 | FY 2023 | FY 2024 |
|---|---|---|---|
| Salary | $696,116 | $753,893 | $871,175 |
| Stock Awards (grant date fair value) | $797,313 | $963,802 | $1,378,138 |
| Non-Equity Incentive Plan Compensation (AIP paid) | $656,482 | $1,409,720 | $1,329,692 |
| Change in Pension Value | — | $75,329 | $2,322 |
| All Other Compensation | $188,511 | $371,998 | $138,736 |
| Total Compensation | $2,338,422 | $3,574,742 | $3,720,063 |
Additional base salary reference points: base salary as of 12/31 increased from $824,856 (2023) to $882,596 (2024) .
Performance Compensation
Annual Incentive Plan (AIP)
| Component | 2023 Target | 2024 Target | 2024 Actual Payout |
|---|---|---|---|
| AIP Target Opportunity (% of base salary at 12/31) | 95% | 100% (prorated avg 98.3%) | 153.2% of target |
| Key Metrics | Financial (net income), cash from ops, strategic, operational, safety | Financial (net income), cash from ops, strategic, operational, safety | Above-target net income; superior cash from ops; above-target strategic; below-target operational and safety |
Grant detail for 2024 AIP (target dollars):
| Grant Date | Threshold ($) | Target ($) | Maximum ($) |
|---|---|---|---|
| 01/25/2024 | $368,925 | $838,466 | $1,676,932 |
| 05/01/2024 (proration adjustment) | $12,932 | $29,390 | $58,781 |
Long-Term Incentive Plan (LTIP) — PSAs and RSUs
Target LTIP opportunity:
| Year | Target LTIP Opportunity ($) |
|---|---|
| 2023 | $1,000,000 |
| 2024 | $1,400,000 |
2024 grants detail:
| Award Type | Grant Date | Target (#) | Max (#) | Grant Date Fair Value ($) | Vesting |
|---|---|---|---|---|---|
| PSAs (Relative TSR) | 01/25/2024 | 7,268 | 14,536 | $527,729 | 3-year period; payout by TSR vs EEI peer group |
| PSAs (EPS CAGR) | 01/25/2024 | 8,584 | 17,168 | $510,233 | 3-year EPS CAGR vs long-term targets |
| RSUs | 01/25/2024 | 5,723 | — | $340,175 | Time-based vest at 12/31/2026 |
Grant date fair value by award type (2024):
| RSUs | PSAs Target | PSAs Maximum |
|---|---|---|
| $340,175 | $1,037,962 | $2,075,925 |
2023 grants (for trend):
| Award Type | Grant Date | Target (#) | Max (#) | Grant Date Fair Value ($) |
|---|---|---|---|---|
| PSAs (Relative TSR) | 02/02/2023 | 4,943 | 9,886 | $350,261 |
| PSAs (EPS CAGR) | 02/02/2023 | 5,813 | 11,626 | $368,137 |
| RSUs | 02/02/2023 | 3,875 | — | $245,404 |
LTIP vesting outcomes:
- 2021–2023: TSR 53rd percentile → 107.5% payout; EPS CAGR 8% → 200% payout .
- 2022–2024: EPS CAGR 3% → no payout; TSR 46th percentile → 89.9% payout .
Options: ALLETE does not currently grant stock options and has no outstanding options; repricing/cash buyouts without shareholder approval prohibited .
Equity Ownership & Alignment
| Measure | Value |
|---|---|
| Shares Beneficially Owned (3/14/2025) | 33,470 |
| RSUs (counted for guideline purposes) | 17,179 |
| Total Shares Counted for Guideline Purposes | 50,649 |
| Common Stock Ownership Guideline | 5x annual base salary for CEO |
| Shares Needed to Meet Guideline (based on $65.64 price) | 67,230 |
| Ownership as % of shares outstanding | Each director/NEO individually owns only a fraction of one percent |
| Stock Vested in 2024 | 3,208 shares; $186,719 value realized |
| Pledging/Hedging/Short Sales | Prohibited by policy |
| Guideline Compliance Status | Board has determined Ms. Owen is making satisfactory progress toward meeting the guideline |
| Retention Requirement | Must retain 100% of LTIP shares (net of taxes) until guideline met; RSUs counted, PSAs unvested not counted |
Employment Terms
| Provision | Terms |
|---|---|
| Employment Agreements | None for NEOs |
| CIC Severance Plan Trigger | Double-trigger: termination within 6 months before to 2 years after change in control (for cause/good reason definitions) |
| Severance Multiples | 2.5x annual compensation (salary + target bonus) for Ms. Owen; 2x for certain other NEOs |
| 280G Treatment | Modified cap to safe harbor if yields greater after-tax benefit; no excise tax gross-ups |
| Non-Compete/Non-Solicit | Non-compete 1.5 years for Ms. Owen; non-solicit 2 years (no recruiting employees/directors); nondisparagement obligations |
| Clawback Policies | Mandatory recovery for accounting restatements (effective 12/1/2023); discretionary recovery for misconduct/fiduciary breaches/fraud/covenant breaches |
| CIC Equity Treatment | RSUs vest/accelerate unless assumed; if assumed, vest on termination within 18 months; PSAs pay greater of target or actual, prorated; options/SARs immediately exercisable |
| CIC Estimated Payments (as of 12/31/2024) | Severance $4,412,980; PSAs $1,635,307; Unvested RSUs $312,942; Benefits $44,310; Outplacement $25,000; Total $6,430,539 |
| Retirement/Disability/Death (12/31/2024) | PSAs $1,103,515; Unvested RSUs $312,942; Total $1,416,457 (AIP no acceleration) |
Pension and deferred benefits:
| Plan | Credited Service (yrs) | Present Value |
|---|---|---|
| Nonunion Pension Plan | 4.42 | $110,858 |
| SERP II | 16.50 | $715,726 |
All Other Compensation components include company RSOP and SERP II contributions: $53,475 and $77,317, respectively (2024) .
Board Governance (Bethany M. Owen as Director)
- Board Service: Director since 2019; Board Chair since May 2021 .
- Independence: Chair is not independent; Board annually appoints an independent Lead Director who is ex officio on all committees, presides executive sessions, and leads CEO evaluation; committees are comprised of independent directors .
- Committee Structure: Audit, Executive Compensation and Human Capital (ECHC), and Corporate Governance & Nominating (CG); all members independent; Audit Committee meeting count five in 2024 .
- Meeting Attendance: Board held 16 meetings in 2024; each Director attended every Board and committee meeting .
- Director Compensation: Employee Directors receive no additional pay; Ms. Owen received no Board compensation in 2024 beyond NEO compensation .
- Director Ownership Guideline: Non-employee Directors must own 500 shares before election and within five years hold shares worth at least 5x cash retainer .
Say-on-Pay & Shareholder Feedback
- 2024 say-on-pay approval for 2023 NEO compensation: 94.5% .
- Say-on-pay frequency: 96% supported annual votes at 2023 meeting; Board will hold annual votes .
Compensation Structure Analysis
- 2024 increases raised Ms. Owen’s AIP target to 100% (prorated to 98.3%) and LTIP target to $1.4M, aiming to move total target compensation closer to market median while maintaining pay-for-performance weighting .
- AIP outcomes reflect strong financial execution (net income, cash from ops) balanced by operational and safety shortfalls, producing 153.2% payout for Ms. Owen .
- LTIP mix emphasizes PSAs (TSR and EPS CAGR at 75%) and RSUs (25%); 2024 3-year EPS underperformed (0–1% CAGR) yielding no EPS PSA payout for the 2022–2024 period; TSR payout slightly below target (89.9%) .
Investment Implications
- Alignment and retention: High variable pay with rigorous clawbacks and strict no-pledge/hedge policy supports shareholder alignment; however, Ms. Owen has not yet met the elevated 5x salary ownership guideline, with 67,230 shares needed at $65.64, suggesting continued net-share retention could persist and potentially reduce post-vesting sell pressure .
- Near-term vesting and trading dynamics: RSUs granted in 2023 and 2024 vest on 12/31/2025 and 12/31/2026, respectively, and PSAs for 2023–2025 and 2024–2026 are in flight; 2024 vesting delivered 3,208 shares, indicating manageable delivery size for the CEO relative to float and policy constraints on hedging/pledging .
- Performance signals: Robust AIP payout (153.2%) versus a weaker EPS CAGR outcome (0–3% in recent three-year windows) underlines execution strength in cash generation/net income but highlights earnings growth headwinds—important for gauging future PSA payouts and long-term comp realization .
- Governance checks: Combined Chair/CEO mitigated by strong Lead Director model, fully independent committees, and perfect attendance, reducing dual-role independence risk; say-on-pay support remains strong (94.5%), easing near-term governance overhangs .