Ralph LaRossa
PUBLIC SERVICE ENTERPRISE GROUPAbout Ralph LaRossa
Ralph A. LaRossa is Chair of the Board, President and CEO of Public Service Enterprise Group (PSEG) since September 2022, and Chair since January 2023; age 61; BE in Engineering from Stevens Institute of Technology . Under his tenure, PSEG emphasized regulated investment-led growth and sustainability; 2024 operating revenues were $10.29B vs $11.24B in 2023, Operating EPS (non-GAAP) rose to $3.68 from $3.48, and TSR outperformed the Dow Jones Utilities peer index over recent years (value of a fixed $100 investment reached $169.91 by year-end 2024 vs peer $133.53) .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| PSEG (parent) | Chair of the Board; President & CEO | Chair: Jan 2023–present; CEO: Sep 2022–present | Combined Chair/CEO structure with strong Lead Independent Director; focus on regulated investments and clean energy transition |
| PSEG (parent) | Chief Operating Officer | Jan 2020–Aug 2022 | Enterprise-wide operational leadership across segments |
| PSEG Power | President & COO | Oct 2017–Aug 2022 | Led generation business; operational reliability and safety |
| PSE&G (utility) | President & COO | Oct 2006–Oct 2017 | Led regulated utility operations; modernization, reliability |
| PSE&G | Associate Engineer | Joined 1985 | Long-tenured operator with deep domain expertise |
External Roles
| Organization | Role | Years | Notes |
|---|---|---|---|
| — | Current public company directorships | — | None disclosed |
Fixed Compensation
| Metric | 2022 | 2023 | 2024 |
|---|---|---|---|
| Base Salary ($) | 971,950 | 1,293,800 | 1,345,600 |
| Target Annual Bonus (% of Salary) | — | — | 135% target (MICP) |
| Actual Annual Bonus Paid (MICP) ($) | 1,143,800 | 1,833,300 | 2,470,500 |
| Perquisites & Other ($) | 44,692 | 40,666 | 51,825 |
| 401(k) Company Match ($) | — | 13,800 | 13,800 |
| Total Compensation ($) | 9,510,542 | 11,778,863 | 12,367,961 |
Notes:
- 2024 CEO base salary increased 4%; MICP target raised to 135%; LTI target increased 6.3% .
- No tax gross-ups for excise taxes; perquisites modest and transparent .
Performance Compensation
Annual incentive (MICP): Emphasizes Operating EPS (non-GAAP), business unit scorecards (People & Safety, Reliability, Customer, Sustainability), and strategic initiatives; payout range 0–200% of target .
Long-term incentive (LTIP) mix and grants:
- 2024 grant (Feb 13, 2024): PSUs 91,412 target units ($5,950,007 fair value), RSUs 43,553 units ($2,550,028 fair value)
- 2024–2026 PSU metrics: 50% relative TSR; 25% EPS growth (aligned to 5–7% CAGR, midpoint target); 25% ESG index (methane reduction, carbon-free generation, EE electric/gas)
- All NEOs, including LaRossa, are retirement-eligible: RSUs vest graded over one year; PSUs vest 1/36 monthly over performance period; distributions per plan rules
2022 PSU payout (three-year period ended Dec 31, 2024):
| Metric | Weighting | Target definition | Actual/Payout |
|---|---|---|---|
| Relative TSR | 40% | Peer-percentile schedule (25th/50th/75th) | Top quartile; 200% |
| EPS Growth | 20% | Yr 3 Op EPS and 2025 guidance supporting 5–7% CAGR | Exceeded 2024 target; low end of 5–7% in 2025; 69% |
| ESG Index | 20% | EE electric/gas, methane, carbon-free generation, Sustainalytics | High-end performance across sub-metrics; 148% |
| Relative ROIC | 20% | Peer-percentile schedule | Top quartile; 200% |
| Total PSU Payout | — | — | 163% of target |
| Shares/Value to LaRossa | — | — | 147,441 PSUs; $11,948,648 (avg high/low $81.04 on 2/28/2025) |
Equity Ownership & Alignment
| Ownership Item | Amount |
|---|---|
| Direct shares owned | 35,711 |
| Stock units/RSUs (vested+unvested) | 104,202 |
| Deferred equity shares | 171,018 |
| Total beneficial ownership | 310,931 shares (<1% of class) |
| Outstanding unvested RSUs (market value) | 7,487 units; $632,563 (at $84.49) |
| Outstanding PSUs at target (market value) | 92,260 units; $7,795,086 (at $84.49) |
| Executive stock ownership guideline | CEO: 8x salary; all NEOs met |
| Hedging/pledging | Prohibited for all employees and Directors |
| Trading pre-clearance | Required for Directors/officers; window or 10b5-1 plan |
Insider selling pattern (indicative of ongoing 10b5-1 plan; small monthly disposals):
| Date | Shares Sold | Notes |
|---|---|---|
| Oct 1, 2024 | 1,378 | Weighted avg price ~$90.20 |
| Nov 1, 2024 | 1,378 | Reported sale |
| Dec 2, 2024 | 1,378 | Reported sale |
| Jan 2, 2025 | 1,378 | Reported sale |
| Feb 3, 2025 | 1,378 | SEC Form 4 |
| Mar 3, 2025 | 1,378 | Reported sale |
| Apr 1, 2025 | 1,378 | Reported sale |
Employment Terms
| Provision | Key Terms |
|---|---|
| Severance (termination without cause) | CEO: 2.0x base + target bonus; pro-rata MICP; benefits, outplacement; unvested equity per award terms |
| Change-in-control (double-trigger) | CEO: 3.0x salary+target bonus; pro-rata bonus; accelerated equity (PSUs pro-rata based on actual performance); enhanced retirement; welfare benefits; outplacement; subject to excise tax cap (no gross-up) |
| Illustrative CIC payments (12/31/2024 scenario) | Aggregate $6.39M after parachute cap forfeiture; details: severance $9.49M; pro-rata bonus $1.82M; RSUs $0.63M; enhanced retirement $0.13M; benefits/outplacement/education; parachute payments forfeited ($5.78M) |
| Clawback | Three-year lookback for restatement/misconduct/Standards of Conduct violation; separate compliance with SEC recovery rule; applies to MICP and LTIP |
| Non-compete/non-solicit | Required covenants under Key Executive Severance Plan (duration not specified in proxy) |
Board Governance
- Director since 2022; currently Chair of the Board and Chair of the Executive Committee; not independent (all other directors are independent) .
- Board leadership combines Chair/CEO; mitigated by a strong Lead Independent Director (Susan Tomasky) with defined duties (executive sessions, agenda-setting, information quality) .
- Committees are entirely independent (except Executive Committee); O&CC oversees pay, succession, clawbacks, and uses independent consultant CAP .
- 2024 board activity: seven meetings; each incumbent director attended at least 75% of board/committee meetings .
Director compensation (for outside directors; CEO receives no director fees):
| Element | Amount |
|---|---|
| Annual cash retainer | $120,000 |
| Annual equity grant (stock units) | $180,000 |
| Lead Independent Director fee | $40,000 |
| Committee Chair fees | $25,000–$30,000 depending on committee |
| Director stock ownership guideline | 6x annual retainer ($720,000) |
| CEO director pay | Not applicable; compensated only as employee |
Compensation Structure Analysis
- Pay mix heavily at-risk: CEO target TDC $11.66M for 2024 with PSUs 70% of LTI and RSUs 30%; at-risk portion ~89% for CEO .
- Shift to graded vesting for RSUs starting 2024 improves retention while reducing cliff risk; PSUs continue multi-year performance focus .
- Targets are rigorously set and reviewed; metrics include sustainability (ESG) embedded in both MICP and LTIP, with disclosed forward-looking PSU targets .
- No options, repricing, hedging, or pledging; strong clawbacks and ownership requirements reinforce alignment .
Say-On-Pay & Peer Benchmarking
- 94.1% say-on-pay approval in 2024; active shareholder engagement program .
- Peer group (unchanged for 2025) includes Ameren, AEP, ConEd, Dominion, Duke, Edison Intl, Entergy, Eversource, Exelon, PPL, Sempra, Southern, WEC, Xcel, CMS, DTE, FirstEnergy .
- Target compensation positioned around peer median, with ability to exceed for top-quartile performance/scope .
Performance & Track Record
| Metric | 2023 | 2024 |
|---|---|---|
| Operating Revenues ($MM) | 11,237 | 10,290 |
| Net Income ($MM) | 2,563 | 1,772 |
| Operating Earnings (non-GAAP) ($MM) | 1,742 | 1,839 |
| Operating EPS (non-GAAP) ($) | 3.48 | 3.68 |
| Year-end market price ($) | 61.15 | 84.49 |
Highlights in his leadership period include completion of ~2.2M smart meters (AMI), BPU approval for ~$2.9B Energy Efficiency II through 2027, extension of GSMP phase two to 2025, and sustained inclusion in top ESG indices (MSCI AAA rating) .
Equity Ownership & Pledging Policy Compliance
- Ownership guidelines met; no hedging or pledging permitted; pre-clearance and approved windows for trades reduce governance risk .
Related Party Transactions
- Brother, Christopher LaRossa, is a PSE&G employee; compensation aligned to role; CEO has no involvement; Governance Committee reviewed and deemed it in stockholders’ best interests .
Employment Terms (Severance/CIC Economics — detail)
| Scenario (12/31/2024) | Severance ($) | Pro-rata Bonus ($) | Unvested RSUs ($) | Enhanced Retirement ($) | Benefits/Other ($) | Parachute Forfeiture ($) | Aggregate ($) |
|---|---|---|---|---|---|---|---|
| Termination without cause | 6,324,320 | 1,816,560 | 632,563 | — | 49,015 | — | 8,822,458 |
| CIC termination (double-trigger) | 9,486,480 | 1,816,560 | 632,563 | 127,000 | 102,323 | (5,775,707) | 6,389,219 |
Investment Implications
- Pay-for-performance appears robust: high at-risk mix, multi-year PSU structure with disclosed targets, strong clawback and ownership policies, and sustainability-linked metrics; 2022 PSU payout at 163% reflects outperformance on TSR/ROIC and ESG execution .
- Retention risk looks contained: retirement eligibility is offset by graded vesting and meaningful unearned PSU exposure; severance/CIC protections are standard, double-trigger, and capped for excise tax .
- Insider sales are small, consistent, and likely plan-based; monitor for acceleration or size changes that could signal pressure, but current pattern is not a red flag given pre-clearance and policy constraints .
- Governance: combined Chair/CEO is mitigated by a strong Lead Independent Director and fully independent committees; say-on-pay support is high, and shareholder-friendly actions (eliminating supermajority provisions) are pursued, indicating constructive board-shareholder alignment .