Windstream 2009 Annual Report Download - page 39

Risks Presented by Windstream’s Compensation Programs
As required by SEC rules, Windstream has assessed the risks that could arise from its compensation policies
for all employees, including employees who are not officers, and has concluded that such policies are not
reasonably likely to have a material adverse effect on Windstream. To the extent that Windstream’s
compensation programs create a potential misalignment of risk incentives, Windstream believes that it has more
than adequate compensating controls to mitigate against the potential impact of any such misalignment. These
compensating controls include strong internal controls over financial reporting, robust stock ownership
guidelines, a clawback policy for senior executives, and a three year vesting cycle for equity-based
compensation. The result is a strong alignment between the interests of management and shareholders.
Windstream also engages in an annual risk assessment process that is conducted by Windstream’s Internal Audit
Department. The results of this risk assessment are reported annually to Windstream’s Audit Committee and full
Board of Directors, and this assessment is designed in part to identify any activities that create improper risks to
Windstream.
Compensation Committee Interlocks and Insider Participation
During 2009, the Compensation Committee consisted of Messrs. Montgomery (Chairman), Beall and
Foster. All members of the Compensation Committee during 2009 were independent directors, and no member
was an officer or employee of the Windstream or a former officer of Windstream. No member of the
Compensation Committee serving during 2009 had any relationship requiring disclosure under the section titled
“Certain Transactions” in this Proxy Statement. During 2009, none of our executive officers served on the
compensation committee (or its equivalent) or board of directors of another entity whose executive officer served
on our Compensation Committee.
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