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Corporate governance

Sustainability begins at the highest levels in Black Hills Energy, with oversight from our board of directors and full support from our CEO and ESG Steering Committee. Our commitment to sustainability is integrated throughout the company with guidance from a cross-functional sustainability strategy team.

We believe that strong governance lays the groundwork for sustainable success and provides the foundation for constructive management and strategic oversight. It also supports a rigorous culture of compliance and accountability.


Business conduct

Our corporate compliance and ethics programs provide the foundation for our business conduct, essential for earning the trust of our customers and communities, our regulators and shareholders, and our employees. We hold ourselves accountable for complying with all company policies, state and federal laws, and the rules and regulations that govern our industry. To facilitate this compliance, employees at all levels of our company, along with contract workers and vendors, are expected to complete annual training on — and adhere to — our Code of Business Conduct.


Human rights

Our respect for human rights is reflected in our corporate values. We support the principles outlined in the United Nations Universal Declaration of Human Rights. Our Human Rights Policy outlines support for standards including ethical and lawful practices concerning human rights, diversity, nondiscrimination and harassment, labor standards, collective bargaining and supplier relationships.


Ethics Helpline

We strive to provide a workplace environment where employees feel comfortable asking questions or voicing concerns without fear of retaliation. To support this culture, we provide a dedicated and confidential Ethics Helpline that is available 24 hours a day, seven days a week. This service is available to all employees, as well as to anyone outside the company, to report actual or suspected ethical or illegal misconduct. The Ethics Helpline is managed by an independent, third-party operator and all reports are promptly investigated. Our ethics program is reviewed both internally and externally on a regular basis and employee understanding of the program is periodically assessed.

 

Leadership and company oversight


The members of our board of directors have a fiduciary responsibility to act in the best interests of Black Hills Corp. and its shareholders. The board operates according to best practice principles outlined in the “Corporate Governance Guidelines of the Board of Directors.” These principles lay the foundation for the board’s oversight responsibilities.

Our corporate governance structure promotes a strong, independent board of directors composed of diverse individuals whose backgrounds, abilities, commitment and expertise combine to provide strong oversight for the company.


BOARD OF DIRECTORS

 


Risk management and compliance

 

Risk management

Our enterprise risk management program is designed to identify, report and manage all forms of relevant risk and opportunity. Managing all areas of risk, including ESG, cybersecurity, compliance, human resources, operational, regulatory, financial and reputational risks, are embedded into business processes and key decision making at all levels of the company. Our enterprise risk management program includes regular reporting to our Senior Leadership Team and quarterly reporting to our board of directors.


Cybersecurity

Black Hills Energy applies industry-standard security frameworks in our Corporate and Industrial Control System (ICS) environments as part of our commitment to the delivery of safe and reliable energy to our customers. We apply a standard of continuous improvement to cybersecurity, with ongoing employee training, education, and system enhancements. Security assessments are regularly conducted through internal threat hunting as well as external penetration testing. The company is subject to regular compliance audits which are conducted by outside audit firms (for SOX) and regulatory bodies, including North American Electric Reliability Corporation (NERC) and Transportation Security Administration (TSA). We incorporate government and industry-related security intelligence sources and actively participate in industry peer groups such as Edison Electric Institute (EEI), American Gas Association (AGA) and Cybersecurity and Infrastructure Security Agency (CISA). Our Chief Information Officer provides quarterly reports to the board of directors.

Black Hills Energy is also a member of the Cybersecurity Risk Information Sharing Program (CRISP), a partnership with energy providers and the U.S. Department of Energy. As a voluntary participant in the CRISP program, we share threat information which could potentially detect and prevent cyber threats directed at Black Hills Energy and other utilities. Black Hills Energy also participates in several public-private information sharing agreements with the DOE, CISA and FBI as well as other private sources.

At Black Hills Energy, each employee plays a role in security and our overall culture of security and security awareness is embedded in our safety culture. Internal phishing drills are conducted monthly, and results show Black Hills Energy scores significantly better than industry benchmarks.


Reliability and operational continuity

Reliability and operational continuity are critical to us and those we serve. We evaluate our systems to identify opportunities to support a safe culture. We also routinely test our systems and conduct table-top drills and large event mock exercises to identify gaps in our response plans and enhance operating procedures.

 

Environmental policy

Our environmental policy outlines our commitment to protecting our natural resources and applies to our suppliers, vendors and contractors, as well as our company. Our comprehensive environmental management system (EMS) is used to track performance and compliance with all applicable state and federal regulations.