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First Energy CEO Issues Letter to Clarify Conference Call Comments

On Friday morning, July 24, 2020, FirstEnergy Corp. (FirstEnergy) hosted a conference call and live webcast to discuss our second quarter financial results with investors and analysts. Following the call, there were some

Benzinga · -

On Friday morning, July 24, 2020, FirstEnergy Corp. (FirstEnergy) hosted a conference call and live webcast to discuss our second quarter financial results with investors and analysts. Following the call, there were some additional questions that led me to believe it might be beneficial to clarify several points that I made.
The first relates to details of the separation of FirstEnergy and FirstEnergy Solutions (FES), which began when FirstEnergy announced a strategic review of competitive generation in November of 2016. Also, in November, the FES board was replaced with two independent board members and three new board members from the competitive generation business. FirstEnergy and FES independently engaged legal and financial advisors to help guide each of us through the complicated strategic review. At that point, I and other members of FirstEnergy leadership no longer had any decision-making power regarding the strategic direction of FES. This fell under the purview of the FES board. Leaders at FirstEnergy, me included, had frequent discussions with FES leadership and its board about the strategic review and, as it progressed, numerous matters related to FES, including employee impacts and shared services. As events unfolded, FES' focus turned increasingly to bankruptcy as the sole alternative, culminating with the bankruptcy filing in March 2018. Immediately after, FES was deconsolidated from FirstEnergy's financial statements.
The second clarification I'd like to make is regarding FirstEnergy making decisions under the shared services agreement with respect to external affairs. During the call, a question was asked as to whether we were "running external affairs" for FES following our separation. As I responded at the time, this was not the case. While FES received support from FirstEnergy's External Affairs team to varying degrees, that support decreased over time, particularly, as the FES bankruptcy approached. FES made its own decisions after its new board was in place with respect to its external affairs strategy.
This third clarification, while perhaps unnecessary, is related to my statement that in every interaction with political leaders, I talked about FirstEnergy's obligations to conduct its business transparently, ethically, and professionally. While those responsibilities are central to my actions, I did not mean to suggest that I express that responsibility literally in every single communication.
As I have said many times, conducting our business ethically and acting with integrity and honesty are foundational principles for the entire FirstEnergy family as well as me personally. These high standards have fostered the trust of our employees, customers, and the financial community.