Exelon Corp

## 7. OVERSIGHT

7.1. The Exelon Corporate Governance Committee shall be responsible for:

a) overseeing the Company's compliance with policies and procedures related to corporate

political spending, and

b) at least annually, reviewing a report outlining strategic priorities for Political Contributions

and the Company's procedures for making Political Contributions.

7.2. Prior to disclosure on the website, the Exelon Corporate Governance Committee shall review
each semi-annual Political Contributions Report prepared in accordance with Section 5.

7.3. Senior members of Exelon's Government, Regulatory Affairs and Public Policy team shall
overseen a process for considering whether the positions of candidates and organizations to
which the Company contributes, taken in their entirety, conflict significantly with the
Company's business objectives, corporate policies, public policy priorities, and values, in a
manner that calls into question the appropriateness of the Company's continued support. This
process shall be reviewed at least annually with the Exelon Corporate Governance
Committee.

# Interactive Sustainability Report

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Exelon cooperated fully with the government's investigation and prior to its resolution implemented four new companywide ethics policies that substantially increased oversight of our interactions with public officials, implemented a series of new controls and enhanced guidance and training. Among other things, the policies [(accessible here) require tracking and review of](https://www.exeloncorp.com/leadership-and-governance/governance-overview) requests, referrals and recommendations from public officials; strengthen due diligence and supervision of lobbyists and political consultants; and require regular reporting to the Audit and Risk Committee of Exelon's Board of Directors and to utility boards of directors regarding interactions with public officials. Employees whose roles regularly involve interactions with public officials annually receive additional training to support compliance with these policies. [...] In addition, in 2020 Exelon created the new role of Executive Vice President (EVP) for Compliance and Audit to oversee both the Compliance & Ethics and internal audit programs. In 2022, Exelon added Enterprise Risk Management to that reporting structure. This role reports to Exelon's Chief Executive Officer and to the Chair of Exelon Board's Audit and Risk Committee and serves as a member of Exelon's Executive Committee. The EVP for Compliance, Audit, and Risk also provides regular reports to the Audit and Risk Committee of Exelon's Board of Directors. This structure increases independence, ensures central oversight of compliance activities and facilitates sharing of insights regarding compliance, ethics, audit and enterprise risk matters across operating companies.

**Exelon is committed to the highest standards of integrity and ethical behavior. We took action to strengthen our** compliance governance under the leadership of a new executive vice president of Compliance, Audit and Risk. We have substantially increased oversight of our interactions with public officials, implemented a series of new controls and enhanced our guidance and training. [...] We have significantly increased the number and diversity of officials who must review and approve sensitive interactions, including by requiring: - All requests, referrals and recommendations from public officials for anything of value, or relating to hiring or the use of vendors, be logged and routed to Compliance and senior business leadership for review and approval. The only exceptions are routine requests for constituent assistance or information. - Prompt reporting and tracking of anything of value provided to public officials, including, but not limited to, cash or other monetary payments, entertainment, meals, benefits to public officials' family members, employment and directed charitable contributions. - Detailed tracking of all gifts, entertainment and other things of value provided by public officials. - Detailed twice-yearly reviews of the activity of each lobbyist and political consultant, with reporting to Compliance, senior business leadership and Exelon and operating company Boards. - Approval and annual review of engagement with lobbyists and political consultants by Compliance and senior leadership. - Disposition of requests be tracked and reported to Exelon and operating company Boards. - Activity relating to public officials, including disposition of public official requests, be regularly reported to Exelon and operating company Boards [...] We have added multiple controls to reduce the risk of inappropriate conduct, including: - Requiring new and existing lobbyists and political consultants to undergo a thorough due diligence process, which must be reviewed and approved by Compliance and senior business leadership, and refreshed annually. - Establishing a process to identify and provide special scrutiny of vendors affiliated with public officials. - Prohibiting the subcontracting of lobbying and political consulting work. - Requiring detailed written contracts for lobbyists and political consultants, which specify the scope of work and require compliance with all applicable legal and ethics obligations. - Requiring that lobbyists and political consultants provide detailed invoices describing their work, which must be reviewed and certified as appropriate before payment may be issued. [...] We have implemented four new mandatory policies governing interactions with public officials that spell out detailed rules and procedures and provide a basis for accountability: ### 1. Interactions with Federal, State and Local Public Officials - Establishes rules for providing anything of value to public officials and a framework for the reporting, review and tracking of requests, referrals and recommendations from public officials. - Prohibits providing anything of value to, or at the direction of a public official to improperly influence that official's decision-making. ### 2. Due Diligence and Monitoring Procedure for Third Parties Engaged in Political Consulting and Lobbying Activities - Establishes requirements for engaging and overseeing lobbyists and political consultants, including rigorous due diligence, regular monitoring and transparent reporting to Compliance, senior business leadership and Exelon and operating company Boards. ### 3. Referrals, Recommendations and Requests from Public Officials Regarding Employment Decisions - Establishes procedures to ensure that requests and recommendations from public officials regarding employment decisions don't undermine Exelon's commitment to hire and promote the best-qualified, available candidates from a diverse and well-qualified applicant pool. - Prohibits hiring or promoting candidates for the purpose of improperly influencing public officials. ### 4. Vendors and Suppliers Affiliated with or Referred, Recommended or Requested by Public Officials - Establishes procedures to ensure that public official requests, recommendations and referrals don't inappropriately influence procurement decisions. - Prohibits engaging a vendor for the purpose of improperly influencing an official's decision-making. - Automatically disqualifies candidates if their hiring is requested or recommended by a public official. ### The policies, which apply across all Exelon subsidiaries in Illinois and all other jurisdictions where Exelon operates, are available on the Company's website here.

2.1. This Policy sets forth the overarching standards and requirements that govern our interactions with public officials. This Policy applies to all officers, employees, directors of Exelon and its subsidiaries. This Policy: [...] - Requires compliance by Internal Lobbyists with applicable registration and reporting requirements; and [...] - Establishes general requirements for engaging and monitoring the work of External Lobbyists and political consultants who act on the Company's behalf with public officials. (These requirements are set out in more detail in Exelon's Due Diligence and Monitoring Process for Third Parties Engaged in Political Consulting and Lobbying Activities, LE-AC-PCD8-001). [...] 4.2.5. Each quarter, by the last day of the month following the end of the prior quarter, business unit level Government Affairs shall provide a written report to Compliance & Ethics, with a copy to the business unit CEO and General Counsel, of Anything of Value provided to Public Officials under Section 3.2.2. [...] 4.2.5.1. Business unit Government Affairs will provide governance and oversight of the reporting requirements identified in Section 3.2.4 and 3.2.5. [...] 4.3.1.4.1. The Chief Compliance & Ethics Officer is responsible for the system that documents and tracks Public Official requests, recommendations, and referrals and the Company's disposition of them consistent with this Policy. [...] 4.3.1.4.2. The business unit officer responsible for Government Affairs shall promptly review the request and determine the appropriate response, consulting with the business unit General Counsel's office and other stakeholders as necessary. The business unit officer responsible for Government Affairs shall communicate the proposed response to the request to the Chief Compliance & Ethics Officer, who is responsible for making the final determination that the proposed response is consistent with this Policy. [...] 4.3.1.4.3. The Chief Compliance & Ethics Officer shall provide quarterly reports to the Audit and Risk Committee of the Board of Exelon Corporation and to the Board of Directors of each business unit of all requests from public officials reported under this section and how the Company responded. [...] 4.3.2.2.1. Employees must obtain approval from the business unit officer responsible for Government Affairs prior to registering as a lobbyist on behalf of the Company and prior to engaging in any Lobbying Activities. [...] 4.3.2.2.2. All persons acting as Internal Lobbyists shall report to Government Affairs in connection with all Lobbying Activities in which they engage. [...] 4.3.3.1.1. The Company engages External Lobbyists and Political Consultants and has established detailed pre-approval, contractual, due diligence, and monitoring requirements governing the Company's relationship with all External Lobbyists and Political Consultants. Those requirements are set forth in: Due Diligence and Monitoring Process for Third Parties Engaged in Political Consulting and Lobbying Activities, LE-AC-PCD8-001. [...] 4.3.4.1. Exelon publicly discloses on an annual basis through the Company's website(s) the identities of and other legally required disclosures about external lobbyists and political consultants acting on its behalf, as well as additional information whose disclosure may be legally required.

Exelon's Compliance & Ethics Office is the primary resource for ethics advice and interpretation of the Code of Business Conduct and Supplier Code of Conduct. Our Compliance & Ethics Office provides governance and oversight of Exelon's compliance and regulatory obligations. The Compliance & Ethics Office conducts an annual risk assessment to identify compliance risks across the organization, while assessing controls for those risks. It works with business teams to promote the appropriate design, implementation and testing of controls concerning compliance obligations. [...] In 2020, before entering the DPA, Exelon implemented four new companywide ethics policies that substantially increased oversight of interactions with public officials, deployed a series of new controls and enhanced guidance and training. These policies require tracking and review of requests, referrals and recommendations from public officials, strengthen due diligence and supervision of lobbyists and political consultants and provide for regular reporting to the Audit and Risk Committee of Exelon's Board of Directors and to utility boards of directors regarding interactions with public officials. Employees who regularly interact with public officials receive annual training to support compliance with these policies.

Describe the process(es) your organization has in place to ensure that your engagement activities are consistent with your overall climate change strategy[…]Exelon maintains a Federal Government and Regulatory Affairs and Public Policy and External Affairs teams to ensure that we stay up to date and involved in national regulatory and policy activities relating to clean energy and other climate change issues. Similarly, we have Operating Company Government and Regulatory specialists on the state and local levels, to do the same at the utility jurisdiction level. Exelon's Senior Vice President of Government and Regulatory Affairs and Public is responsible for the development and coordination of the Corporation's overall position on various policies that may affect our businesses. Her counterparts in Exelon's utilities work with executives across all operating companies to maintain alignment with more local issues.

Exelon's Federal Government and Regulatory Affairs and Public Policy Department also works closely with the Corporate Strategy, Innovation and Sustainability Department with regards to developments in industry trends and ongoing climate change analysis that may influence our public position or engagement efforts. Our Senior Vice President and Chief Strategy and Sustainability Officer is responsible for coordinating the Sustainability Council, where Government and Regulatory Affairs is represented, and whose function is to ensure that these issues are brought together with our broader business strategy in context with our Sustainability priorities including climate change. Policy coordination is also part of Exelon's strategic planning process, with our strategy periodically reviewed by the Exelon Executive Committee. Every year with the production of our Corporate Sustainability report, a review board is established with representation across the company to capture and share all related activities. This structured process also helps to ensure that our direct and indirect activities that influence policy are consistent with our overall clean energy and climate change strategy, and well communicated to our stakeholders.

Does your organization have a public commitment or position statement to conduct your engagement activities in line with the goals of the Paris Agreement?[…]Yes

Describe the process(es) your organization has in place to ensure that your external engagement activities are consistent with your climate commitments and/or climate transition plan?[…]Exelon maintains a Federal Government, Regulatory, and External Affairs team to ensure that we stay up to date and involved in national policy activities relating to clean energy and other climate change issues. Similarly, we have Operating Company Government and Regulatory specialists on the state and local levels to do the same at the utility jurisdiction level. Exelon's Senior Vice President of Government, Regulatory and External Affairs is responsible for the development and coordination of the Corporation's overall position on various policies that may affect our businesses. Her counterparts in Exelon's utilities work with executives across all operating companies to maintain alignment at the state and local levels.